CYBERANK: The Advent of “Quality” Pricing Methodology for Internet Advertising, by William M. Keever

“New “Quality” Pricing Methodology for Internet Advertising Puts a Price on our Head, Enabling Others to Profit From Our Web Influence.”

 

For Immediate Release:

 

Nashville, TN, USA (Press Release) September 9, 2008 — Most of us weren’t surprised when we learned that Google was pursuing what is now known as the notorious Friend Ranking Patent.  Internet advertisers such as Google have long wanted to move beyond the traditional internet advertising pricing methodology, that of Quantity (priced on the number of impressions/insertions and/or click-throughs), and figure out a way to price advertising based upon the Quality (or value) of the person viewing the advertisement.

 

For this Google took a page from the fast growing social networking sites, most of which have been subtly (or not so subtly depending upon the site) “valuing” participants or profiles since they launched.  An example of the not so subtle is Naymz, a business networking site that makes no bones about “maximizing [ones] professional opportunities by promoting [ones] good name in [the Naymz] Reputation Community.” 

 

Unlike LinkedIn and other larger business oriented internet networking sites, Naymz goes the extra step of actually giving participants a Reputation Score or “RepScore” as it’s called.  This score is apparently determined by the reputations of those in one’s Reputation Network, and the number and quality of recommendations one receives.   

 

The largest internet business networking site is LinkedIn.  LinkedIn also incorporates a valuation system.  Each participant is impliedly valued based upon a profile owner’s number and quality of contacts, as well as the number and quality of recommendations received from others in one’s LinkedIn network.  The system infers that a person is more reputable, skilled and esteemed where they have recommendations from persons who are in turn highly recommended. 

 

Google has already been inserting advertisements on each person’s LinkedIn, Naymz, and other social networking profiles.  What the new patent pending technology does is evaluate one’s advertising value based upon one’s web influence, the quality of those persons linked to your profile.  The net result is that Google can now not only price advertisements based upon the number or quantity of impressions, but it can also price add impressions based upon the QUALITY of those persons that are more likely to view one’s profile (and therefore the advertisement).  

 

What all this means for you and I is that we now carry a price on our head – literally.  Our YouTube, Facebook, etc. profiles can now be priced based upon our carefully calculated value to Google and its advertisers.  This new pricing methodology would be more palatable if we actually got a cut of the advertising dollars generated off of our web power and influence – but we don’t.  If you’re really quiet, you can almost hear internet advertisers cheer every time we beef up our profiles, connect to more influential people, and invite a greater number of quality recommendations. Because, at the end of the day, it is Google and other internet advertisers that are benefiting from our good names.

 

For more information, visit www.cyberank.com, www.castleventure.com, or email info@castleventure.com.

 

TEN KEY FACTORS TO SUCCESS IN NEW VENTURES

As I have watched entrepreneurs over the years, first as a corporate lawyer, then as a manager of private equity funds, I’ve been able to discern a few fundamental ingredients necessary to the success of any new venture.  Certainly there are exceptions to every rule, but exceptions to the following rules seem to only make success that much harder to achieve, significantly increasing the time necessary (and capital necessary) to achieve profitability (the only real benchmark of entrepreneurial success).  Consequently, I now advise entrepreneurs and startup managers that the following ten factors are each equally crucial to the speedy success of any new venture: 

1.             Be Honest – Investors, employees, partners and customers can smell dishonesty – your lies will find you out.  Those people important to your success can distinguish . . .

a)      True Integrity vs. Appearances

b)      True Humility v. Façade (Pride)

2.             Do Your Homework – know everything about your idea, concept, business and industry (and never stop learning).  This begins with what was discussed above – humility.  Admit you don’t know everything (a true sign of wisdom), and crack the books.

3.             Count the Costs – be resolved to pay the price(s) for success.  Nothing of true value comes without a price.  You should know as you embark on any project that its success will come at a price.  The process of counting the costs is assessing what those costs will be, and then entering into an honest evaluation as to whether you are willing to assume those costs.

4.             Commit – Dedicate yourself to the project with unwavering resolve.  Every project eventually hits the proverbial wall.  The differentiating factor between those that succeed and those that fail is how they respond when they hit that wall.  Some have the resolve necessary to break through the wall, others decide to walk away.

5.             Sacrifice – Pay now or pay later, no such thing as something for nothing.

6.             Network – all the time, with everyone & with confidence.

7.             Get Help – Be willing to ask anyone for help, and always accept help from seasoned, wise, experienced people – Pride has no place in new business ventures.

a)             Accept criticism/critique from others – you want the cream to rise to the top.

b)            Surround yourself with smart people (smarter than yourself) – accept that you don’t know everything.

c)             Don’t hire “Yes” people – and if you already have, bite the bullet and let them go before it costs you dearly.

8.             Make Adjustments – be flexible, always be ready to respond to adversity.  I’ve never read a business plan or met an entrepreneur or start-up manager that can predict the future.  Plans must change in response to the market (e.g. cost of goods/services sold, competition, regulations, human resources, etc.).

9.             Don’t Try to Do It All – because you can’t!  Partner with other key people and companies – no person or company (even Gates or Microsoft) can do it all.  Don’t bite off more than you can chew (and finance).  For example, don’t try to be the manufacturer, distributor, retailer and after-market support, etc.  Instead, partner with existing companies, leverage their clout, credibility, success, business, customers, channels, pipeline, etc.

a)      Product/Services Partnerships – Manufacturer, Distributer, Retailer, etc.

b)      Strategic Partnerships – e.g. hardware/software

10.           Get Tough – starting your own project is hell.  The business world is “dog eat dog.”  You must be ready for anything and everything.  Take into account Murphy’s Law, what can go wrong will go wrong – and prepare for inevitable set-backs.  This translates into a number of important factors, some of which are:

a)             Money (the rule of 2) – every venture capitalist will tell you, if you think you need one million to execute a plan, you probably need 2 million.

b)            Management – you can’t wear every hat in the company. You need experienced intelligent managers to help you succeed.

c)             Mentor – everyone needs someone to use as a sounding board, a confidant that will give us honest advice and guidance, and support us along the road to success.  When the going gets tough, all great entrepreneurs retreat to their mentor, sage and/or support group for comfort and advice.  No one is exempt from this truth.

Certainly there are ways to cut corners and avoid some of the above factors for success, but such detours normally come at great costs (e.g. reputation, family, friends, and finances).  I believe the above defined principles are what separate the truly successful entrepreneur from the rest.  There may be additional elements of success, but adhering to the above rules will certainly ensure a proper foundation is laid for a rewarding venture.    

 

Castle Venture Group partners with Bay7 Studios

Castle Venture Group announced today that it had partnered with Bay7 Studios in Loas Angelos to begin deploying an innovative new approach to recording and distributing music.  William Keever, President and CEO of Castle, stated that Castle is very excited about working with Dave Rouze, President of Bay7.  Dave is an icon in the industry, having worked with the most popular artists over the last 20 years.”  Castle Venture Group is a private equity firm located in Nashville, TN.  See www.castleventure.com and www. bay7studios.com.

Venture Workshop Series

  Castle Venture Group’s President & CEO, William Keever, will be the keynote speaker at a venture capital workshop on June 26, 2008 at Castle Venture’s Nashville, TN offices. Topics will include private equity financing, venture capital negotiations and deal structures, and other business finance topics.  For more information contact the offices of Castle Venture Group at www.castleventure.com.

CONVERGENCE OF VIDEO & INTERNET MARKETING

The Internet has become the world’s most powerful communication tool that, until recently, has relied solely upon text, pictures, and limited video (constrained in a box) to connect with internet users.  In 1992 the World Wide Web consisted of less than 1000 websites worldwide. Today it is estimated that there are over 2 billion websites worldwide.  According to recent statistics, there are over 30 million small businesses in the US alone vying for customers over the internet.  The install base for Broadband (high speed) Internet access also continues to increase, with the United States ranking ninth in the world in terms of overall broadband penetration. As a result, the advent of E-commerce and Internet Communication is rapidly increasing. A recent report by Forrester Research showed online spending in the U.S. is projected to grow to $329 billion by 2010. All of these key indicators highlight the importance of the internet and its increasing impact on business. ”Consequently, significant growth and profit opportunities exist in the internet and wireless communications based video marketing industry over both the short and long term, especially with regard to the growing demand for online video content,” says William Keever, President of NetGreeters Company.  A recent article by the Associated Press entitled “Demand for Video Reshaping Internet,” explained that the largest growth in internet traffic has been the growing popularity of video. A recent Market Intelligence Report released by Internet Research Firm Broadband Directions[ (the “Broadband Report”) stated that, “Broadband-delivered video represents a paradigm change for all of the players in today's video distribution value chain.  For the first time in history, video content providers have the technical ability to deliver high-quality video directly to their intended audiences, without a business relationship involving a third-party distributor.”  In fact, the most recent Alexa.com statistics show that three of the five most trafficked websites are those that feature video.  Broadband's open distribution capabilities are spurring content providers to launch direct-to-consumer broadband video initiatives.  These activities are having a huge impact on the video distribution value chain, and are raising significant demand for video distribution solutions in a broadband-enabled world. While the demand for online video is growing, so is the demand for online marketing tools by businesses.  BtoB’s 2008 Marketing Priorities & Plans Survey found that 80% of all respondent companies planned to dramatically increase their budgets for internet related marketing, with many respondents reporting up to a 33.8% increase in their online marketing budgets.  The majority of the internet marketing budgets will be directed towards email, SEO and web-site video.  The BtoB Survey stated that the online areas that will see the greatest increases in 2008 are email (70.1%), search engine optimization (64.3%) and web-site video (39.5%).  The primary reason for the increase in email, SEO and video related marketing is the fact that these methods have proven to have a much higher reported return on investment (ROI). In fact, in response to the growing demand for video content, companies intend to direct a significant portion of their online marketing budgets toward internet video related marketing.  The recent MarketingSherpa’s Search Marketing Benchmark Guide for 2008 reported that companies are targeting their online marketing dollars to address the growth in video marketing.  The MarketingSherpa’s survey also stated that much of this increased budget would be directed toward video email and search engine marketing.  In addition, much of the existing online marketing dollars are being redirected toward video, email and SEO and away from “pay-per-click,” banner advertising and traditional media.  The dramatic shift to video related marketing is motivated by the realization that the ROI is much greater when video is deployed with email and web-site directed SEO.  Industry leaders report that the increase in online spending will be focused on video because video related marketing achieves greater results where it matters most: higher rates of customer acquisition, conversion and retention.  Consequently, most internet marketing experts agree that the drive toward video marketing has exponentially increased the value of what is called Internet Video Toolmakers.  These “toolmakers” are companies which develop and/or sell online video management and distribution systems.  These systems enable companies to capture, manage and deploy video over the internet via multiple formats.  The most recent example of the recognized value of internet video toolmakers is Yahoo’s acquisition of Maven Networks, Inc.   The announcement of Yahoo’s acquisition of Maven clearly confirms how significantly the internet video industry is heating up.  Maven is considered an Internet Video Toolmaker, selling video publishing systems and toolsets that let companies play, distribute, syndicate, and monetize broadband video.  Its acquisition was hailed as a coming of age for the sector, which Forrester Research projects will experience significant growth over the next three years.  "Internet video, while it was pioneered by a bunch of start-ups, is on the cusp of becoming big business," said Hilmi Ozguc, the chief executive of Maven, which raised $30 million in venture capital prior to the Yahoo purchase.  The deal has raised the profile of internet video companies, and confirms what industry insiders already knew, that one of the defining technologies of the new Web 2.0 is and will be video.  Will Richmond, president and founder of Broadband Directions, an Internet video market intelligence firm, stated that "[Yahoo’s acquisition of Maven is] “a validation of the broadband video market as a whole.” Another Internet Video Toolmaker is NetGreeters.  NetGreeters has created a true video management and distribution system that rivals most larger more expensive systems.  The Broadband Report concluded that video distributors and aggregators are well-positioned for success in the new online video environment, being able to leverage pioneering new business models and video delivery strategies to acquire market share.  “We believe we [NetGreeters} are well-positioned to be a large player in the video delivery market,” says William M. Keever,. One particular avenue is what is known as Digital Asset Management Systems or DAM.  Enterprises are showing renewed interest in digital asset management due to increased creation and use of digital assets, especially video content, across multiple channels. Marketing managers have become aware of the inconsistent use of branded materials across multiple channels.  IT managers bemoan a lack of security for digital assets. And finally, web site and eBusiness managers, under pressure to deliver more interactive and engaging content such as video, need help with their multichannel production issues. These needs of marketing, IT, and eBusiness, plus the need for increased usability and desire for integration with other enterprise solutions, will drive innovation and business for video management systems that can address these needs. While there are digital asset and video management systems currently in the market, these systems are really no more than video library applications, and provide little to no video distribution capabilities. Too address the problem of distribution; NetGreeters has taken traditional video management from a specialized digital asset repository, to a workflow solution that helps enterprises actually deliver digital assets to help achieve sales and business goals.  The NetGreeter system emphasizes the delivery of video content across multiple marketing mediums, targeting specific populations, demographics and end-users.  With the industry is racing toward online video marketing, we believe NetGreeters is perfectly positioned to capture lucrative market share.  The Company has developed a dynamic video insertion system that directs marketing dollars to high conversion existing and prospective customers.  The NetGreeters technology provides intelligent and optimized insertion of video marketing via email, web-sites, mobile communications or within a video stream.  Patent-pending technology securely and automatically distributes video content in real-time based on publisher-defined rules that include variables such as IP addressing, user authentication, current and historical viewer session time, video clip length, and other web-based demographics. For more information, see www.castleventure.com.