Facebook making $1bn

Marc Andreessen talks to Techcrunch about his new fund today and, as a board member of Facebook, say's Facebook is striving to find a new marketing model and platform, rather than take $$'s today through display and ppc. It seems that they are foregoing revenue to force themselves to innovate:

Marc Andreessen:
There’s a lot of confusion out there. Facebook is deliberately not taking a lot of the kind of normal brand advertising that a lot of Web sites will take. So you go to — a company like Yahoo which is another fantastic business and they’ve got these you know banner ads and brand ads all over the place, Facebook has made a strategic decision to not take a lot of that business in favor of building its own sort of more organic business model and it’s still in the process of doing that and if they crack the code on that which I think that we will, then I think it will be very successful and will be very large. The fallback position is to just take normal advertising. And if Facebook just turned on the spigot for normal advertising today, it’d be doing over a billion dollars in revenue. So it’s much more a matter of long term strategy.

Read the full interview and watch the video here.

Marketing: Rules of Digital Engagement

As I sit in a slightly air-conditioned office (it's hot today) in Ho Chi Minh City, I'm wondering, am I too British about marketing?

The developed economies have already got a kind of Queensbury Rules for marketing, it makes it a fair fight, that doesn't hurt or offend (most of the time) along the way. The rules of engagment goes a little something like:

- No spamming (email, sms, twitter...)
- No abuse of social networks
- No spyware
- No pop-ups / pop-unders
- No cyber-squatting
- No keyword bidding on each others brands
- No scraping
- No hacking, cracking...

We're preparing lots of fun marketing ideas for Buzz, our recent addition to Vietnam's internet space, and I'm thinking about Vietnam's rules of engagement. For example:

- I get SMS, email spam here regularly from big companies
- Facebook, for me, is personal friend network, but here the first movers are adopting it as a career network (pls see linked-in :-)
- Paid-to-print PR is widely used and accepted (for bloggers too!)
- etc, you get the idea.

I guess we all have developed a digital culture, based on our age, our nationality, how long we've been online and the way we use web-services...
(Facebook tripped all over the very same thing this week with their changes to Privacy Policy).

So we have to change our marketing approach to what is acceptable to the market. That doesn't mean spamming (!) but it does mean being less 'Queensbury' about it, a little more street-fighting may be necessary.

Are the rules of digital engagement different in your country?

We're all criminals..or Pirates

Do you know what a 'torrent' is? How about if I say 'Vuze' or 'Azureus' or Limewire?

We'll then you're probably also a criminal, so add your mugshot to http://filesharer.org/.

The big news of the week was The Pirate Bay founders, the last bastion of downloading, going to trial. Filesharer.org wants to create a site with all the self-confessed downloaders in the world, in support of PB.... but judging by the take-up rate, I think most criminals are too scared to confess. lol.

Time to be "Economic"

This quote is borrowed 'third-hand' via the excellent maoxian.com blog:

Given where we are today, there are only three ways to restore a balance between current private debt levels and our reduced, but much more realistic, asset values: we can bite the bullet and drastically write down debt; we can let the very long passage of time wear down debt levels as we save more and restore our consumer balance sheets; or we can inflate the heck out of our debt and reduce its real value.

So what's it going to be?

The economic impact of the end of credit is currently ripping through USA, UK and Europe. Asia, and Vietnam, is just beginning to feel this tidal wave. What can we expect; FDI dries up, exports plummet, currencies devalue and asset values either tumble further or gather dust un-traded.

In the internet space, VC's and funds like IDG and VinaCap JFJ are going to see the underlying value of their investments tumble too and, surely, will expect their intrapreneurs to make the already invested money last longer, rather than go for 2nd/3rd round funding. Fortunately, online revenue models are not yet established in this market, so not many businesses are going to be relying on income to stay afloat. Interesting times ahead.

Marketing: The Rise and Rise of ROI

Martin Sorrell is quietly taking out strategic 'digital' investments like a sniper in a tower. The latest for WPP group is an investment in Omniture, the web analytics firm whose tools are relied on by many of the largest media and brand websites in the world.

Having worked at both WPP (Mindshare London) and News Corp (Times/Sun) these investments, although small, look crystal clear in delivering greater power, influence and effectiveness for the WPP marketing stable. For many of the very media companies WPP is buying from use these analytics tools for their sprawling online empires. And many of WPP's clients or pitch-list (wishlist) also rely on Omniture for their in-house analysis and insight.

In lean times like these, advertisers will want more than "half the money they spend on advertising" to be effective (; John Wannamaker). Now more than ever every marketing $1 has to be accounted for, so it has to count. WPP can look to drive 'display' advertising yields lower by focusing clients on ROI, and drive it's own performance based commission's higher by improving ROI.

WPP strategy is doing a Marketing agency version of Google (information storage and retrieval), or News Corp (media delivery)...rather than just marketing, it's getting into owning the delivery platforms for "insight", "advertising" and "revenue". This cements it's place with media owners and clients. Smart.

But, the ROI space of digital marketing services is high-effort, high attention, high manpower, low-margin, so old media better still pay for the fancy offices for a few more years to come.