Blending paid and earned media in the stream

Facebook COO Sheryl Sandberg is sensibly stepping forward as the public face of the company when it comes to advertising. For all its might and potential, Facebook has suffered from a peculiarity of Silicon Valley: an inability to have someone who talks marketers' language. Maybe Sanberg that's person. In an interview with Businessweek, she made absolutely clear Facebook is an ad business, only a different kind of one than the mass-impression plays on portals and even MySpace. Instead, she talks about the real challenge for advertisers in social media: become part of the stream.

We believe advertising needs to blend into the experience. So yes, when you're reading BusinessWeek, you see an ad. It's something you expect to see, and it's part of your experience. It's part of the experience of reading magazines. On Facebook, what you see are ads that are very similar and integrated into the experience we have. So we don't have big banners across the site, nor do we have text-based ads that are really part of the search experience. What we have are ads that act like our site.

This brings up the (not new) concept of earned media Fred Wilson touted this week. Earned media is an old PR term. It's typically the stuff a company does that gets people talking about it. in the past, that's been through the mainstream media. Nowadays, we're all media. What's interesting is, despite what many of the social media gurus will say, companies need to do more than just be awesome to get part of the stream. Yes, that's important, but advertisers will still need to buy their way in through paid media. The problem is media is created, bought and measured not based on engagement but impressions. That means the type of ads that will work in the stream are different. Take the example Sandberg used: a Honda virtual gift campaign. Honda bought its way into the stream with a virtual gift option on Facebook. About 750,000 Facebook users chose to interact with that and created an additional 2 million impressions for the brand. Is that earned media or paid media? Maybe both.

This is the new game. What's interesting to me is that Facebook seems to want it both ways. It's talking about advertising that's different from traditional placements in that they're optimized for engagement rather than impressions. Yet when I asked them about moving to a pure engagement ad model, it assured me, a NYT story to the contrary, it is not testing engagement pricing. Some say it doesn't matter how the media is priced, but I think moving to a pure engagement model, and developing a system that shows ads based on their liklihood of sharing, sends a message to the market about what type of ad business you have: a blend of paid and earned media.

Comments

[Matt Hames]

It must be the week to write about this. I think paid and earned need to work together. In the 5th anniversary of BK's Subservient Chicken, it's worth remembering that.

[Max Kalehoff]

I disagree that the game is new. Hasn't one of the key objectives of most advertising, since the beginning of time, been to get people talking (earned media)? Most advertising strategists, especially creatives, have told me that forever. Facebook hasn't introduced the hybrid concept, though perhaps Facebook is approaching it from more of the earned side versus the paid side.

[Simon Edhouse]

Let's be clear about this... "earned media" is about an attempt at co-option of genuine W.O.M. and its so irresistable to marketers that they have to say they 'earned it'... Common! The article above says: [getting into the stream of social media is] "...important, but advertisers will still need to buy their way in through paid media."

However, as David Armano [VP of Experience Design with Critical Mass] describes it over at 'Logic+Emotion': "...instead of paying directly for a placement or making arrangements with a partner—you are paying for the time and resources of people, who will investigate what's being said about your brand and engage on your behalf." http://bit.ly/xVO5e

i.e. Its not about 'earning' it... its about 'buying' it... even though its dressed up in the clothes of web 2.0 type participatory mass interaction.

[Doug Schumacher]

Nice briefing of the paid/earned buzz.

I don't know what Facebook's sales pitch is, but measuring paid media on it's engagement seems misdirected, when the ultimate goal of the campaign is to drive to a deeper experience. If that experience is in the banner, then fine, although I'd question that's generally the most effective experience possible.

Paid and earned should be evaluated the same way, because they don't work the same way.

We currently integrate display and search, understanding that each has a different role and position in the funnel. Paid and earned work in a similar way. One tends to flag people, the other then tries to get them into a deeper relationship or experience.

Facebook's competitive advantage will be providing ads and an environment that's better at getting people from the paid ad to the earned experience. Maybe there's an engagement component to that ad, but I don't think that's the way to evaluate it.

[Charles Day]

I picked up on Fred's post about paid vs earned media. Jerry Solomon of Epoch films who also happens to be Fred's brother-in-law) blogged about this concept last week http://bit.ly/14je0 and Fred took it further.

I have a different take on my blog http://bit.ly/DUGCu which is that it is not the media that is earned, but the audience.

Facebook's problem is that as the medium,they have to offer something that we're willing to pay for.

For years, Broadcast tv gave us 'free' entertainment and news.We 'paid' by watching the ads. But that was the contract from the day broadcast tv began.

When your business model begins by putting no value on the service you are providing, it's more than difficult to re-define that contract with your customers later on.

[Mark Cridge]

Absolutely agree that we need to be thinking about how bought, earned (and owned) media all work together. The key is to not confuse bought media as being exclusively traditional offline media, and also not to assume that all work tagged as social media is the same as earned.

I wrote on this recently here http://is.gd/lowI

Rather smart agencies will figure out the right way to communicate on behalf of their clients brands across the full range of bought, owned and earned. The desired result will usually be to create a deep and meaningful connection with consumers regardless of what media is used, however the methods or 'etiquette' that you will employ to achieve that end result will need to be different within each media.

You'll still have to shout and sell in bought media from traditional broadcast channels to placements on social networks, at the same time as listening responding and cultivating earned media through social interactions, as well as using bought and owned placements to actively encourage PR and publicity.

The smart money should be on finding ways to make it all work together.

[Ben Kunz]

Paid, earned, such silly distinctions.

The reality is most advertising of any sort does not work, which is why the impression-based model is so prevalent. Are you expecting an ad for *car tires* right now? Of course not. But if a marketer spends $20 to reach 1,000 people about car tires, and 999 ignore it but one does respond, as long as that response generates at least $21 in profits the ad investment was worthwhile.

The idea that social media can break with the reality that most people don't care to hear your ad message right now is hogwash. Yes, a few things go viral, and it's nice that several thousand people forwarded the Honda virtual gift to each other (I don't recall if Sandberg accounted for duplication in her BW quote). I'd love to know how many bought cars, or even inquired about cars, and if the return on that campaign was any different than traditional advertising impressions. More likely a few thousand people made a quite impulsive click to forward a gimmick to a friend, which is much less successful than getting someone to click through to a web site to learn more about a product.

All advertising is interruptive; it's all highly wasteful; and yet it works when a small portion of the touches yield profitable response. It's basic human psychology that most people don't like interruptions they are not expecting. I highly doubt tossing pillows or kisses at each other on Facebook is going to change that math, whatever label is put on the ad format.

[Michael Maurillo]

@benkunz... are you expecting an ad for *car tires*, of course not, but what I am believe Sandberg is saying is that people expect *ads* when using most forms of media, but that is not the case on FB. At least not ads that interrupt. That's the first step that FB needs to achieve - readjust their user's expectation such that advertising will be expected as part of their stream (earned, paid, otherwise).

Once they find the right experience in which to do that, then they need to work on finding the way to deliver the car tire ad to people in need (or at least own cars). Ideally the how and the what are not mutually exclusive so you end up with a vehicle that is just as contextual as the message.

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[Forsocnet.wordpress.com]

The idea that social media can break with the reality that most people don't care to hear your ad message right now is hogwash