online.sxchu_
March 8, 2014

The Problem with Internet Advertising

The online ad industry has done the advertising world a massive disservice, and there is no easy way of fixing the problem. Before the days of the Internet, the media owner had the responsibility to create high quality content for their consumer base. They had the task of not only creating engaging and interesting editorial pieces, but of placing high quality memorable advertising in the optimum positions. Brands paid a premium for access to this audience, and had to comply by creating high quality advertising material. The concept was the same across media – be it print, TV or radio. Print, radio and TV ads are still the epitome of advertising creativity – so what went wrong when we went digital?

Along came the Internet, surging in popularity in the 90s. Promising global reach beyond traditional media, accurate tracking and measurements, personalized targeting unavailable to mass media all at a fraction of the cost. Advertisers and brands flocked to it in droves. Indeed, advertising revenue is what keeps the Internet going today – it is the lifeblood of search engines, social networks and publishers around the world.

But, there’s a problem. Advertising that looks like this in print:

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Now has a tendency of looking like this online:

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Not that one ad is “worse” than the other – the latter might indeed be getting superior performance in terms of overall lead generation, while the former is probably geared towards memorable brand awareness. One of the problems with internet advertising is that the landscape has become fractured and segmented. Even the most astute agencies have a tough time traversing through this mess – with data management platforms, demand and supply side platforms, ad exchanges, real time bidding platforms, and thousands of different ways of targeting audiences each with different metrics and reports, how can one not become confused? If you want to see how segmented it really is, simply have a look at the ad technology lumascape. And remember – each one of these platforms takes a cut from the overall ad pie.

Another issue with Internet advertising is that media owners have in many ways lost control of their own ad inventory. In the past, advertising had to be vetted and carefully placed among content. These days, ad networks run algorithms that target advertising to individual users. In principle this works pretty well, but if you look at South African ad inventory across the major publishers, you get low budget Forex and insurance ads with very little variation. The digital battle for the lowest CPMs, low barriers to entry for new players, proprietary algorithms controlling ad displays and lack of sufficient quality control across the exchanges has led to this. The results are a commoditization and cheapening of advertising that brings the entire industry into disrepute, and makes many brands wary of significantly investing digital.

This isn’t a complete rant. I love the fact that digital is more measurable, targetable and personalized than any other media format. I love that social media has added a two way conversational dynamic to brand communications. But we need to bring the quality back into cyberspace, and this will take a concerted effort from all parties. Media owners need to stop cheapening their digital properties with low quality inventory, ad networks need to put better quality control measures in place and advertisers need to get more creative and be willing to place larger budgets into digital.

The IAB is trying to fix it in some ways by introducing rich media formats that allow for animations, video and larger ad formats. Publishers are also trying by rendering high quality “pre-roll” ads before viewing an article. The ad networks are also getting better – you have new exchanges that are focused around quality content (like Outbrain) that have an active vetting process before each media item is loaded. We are headed in the right direction, and the digital advertising future looks very bright. As we see more consolidation and standardization in the industry, we will see progress. Lower quality inventory will eventually be phased out, especially on premium publishers. Advertisers are also investing into more than just ads – they are creating mobile and social apps and minisites that create unique and interesting experiences for their customers. For the time being though, we have to remain creative with the options available to us while understanding that digital is a crucial component of the greater marketing pie.

idea concept
January 27, 2014

9 Business Books that Changed my Life

Many of those close to me will know that when I started my first company over 4 years ago, I started with very little. A tiny network, virtually no work experience and only a few month’s worth of money saved up. A potential recipe for disaster in retrospect, but what I did have was a burning desire in my heart to make a dent in the world. 4 years later, I find myself heading up SA’s foremost social media technology company, with ambitious plans to scale things up an order of magnitude in 2014.

The journey has been pretty exciting so far, and I feel it is just the beginning of something much greater. One of the values I hold dear to me and ensure my staff adopt is perpetual education – constant learning in their fields of interest and expertise. This gives my organization and my people an edge, as we sharpen our minds continually to ensure we’re on top of changes in the market and industry as they happen.  I’d like to share the 9 business books I’ve read in the last 4 years that have catapulted my businesses forward and in many ways replaced a more traditional MBA with a practical body of knowledge. Education, of course, is but one component of the business success puzzle, but it is a crucial building block upon which all others stand. If your educational foundation is flawed, you will make costly mistakes through strategic errors as you traverse the path of business.

Losing my Virginity – Richard Branson

losing my virginity
Richard is a great storyteller. He inspired me to believe in my dreams and made me realize my ambitions are actually not all that crazy. This book is an account of his life, and shows what is possible if you give your heart and soul to what you love.

The E-Myth Revisited – Michael Gerber

e mythThis book showed me some solid foundations for developing a business as an income generating asset, developing business systems that are scalable and repeatable and essentially building businesses that do not rely on you to run effectively. If you see business as an extension of your passion, then it may be acceptable to be irreplaceable and permanently vested within it. My goals incorporate developing business systems that work with or without me, leveraging and growing off of each other.

The Black Swan – Nassim Taleb

black swanThis book helped me understand how the human brain considers risk and calculates probability (hint: it’s pretty damn inaccurate at the best of times!). It provides a good framework for assessing and dealing with risk in business as well as life in general. Its a highly intellectual read so you need to stay focused when going through it, but the knowledge and critical thinking you gain is indispensable.

The Four Hour Workweek – Timothy Ferriss

4hour work weekLove this book or hate it, it’s become an international best-seller for a reason. Its filled with practical tips and advice for growing passive income streams with relatively low input cost. Although not the best book in the world if you want to build a global enterprise, it was a great start for me a few years ago to better understand the many ways the Internet can be leveraged to maximize sales.

Think and Grow Rich – Napoleon Hill

think and grow richThe timeless classic – this business book focuses on the mental aspect of business. A strong mind makes for a strong leader, and is absolutely critical to business success. I’ve come to realize that our minds construct our entire reality, and through our thoughts we can change our minds, thus changing how reality is perceived by us. The thoughts we think play a profound part in the quality of life we live, and this book shows you how to condition your mind for success.

Good to Great – Jim Collins

good to greatAnother classic read, this book deciphers the differences between average companies, and companies that have found the “secret” to skyrocket their businesses. Focusing on the success of larger multinational corporates, Jim distils insight into what made these companies special. I learnt a lot about leadership, company culture and creating a balanced environment of fun and discipline at work.

The Lean Startup – Eric Ries

lean startupThis book really helped me understand how a cutting edge technology company like the one I am building can remain cutting edge despite fast market changes. Coming from a software background, I understand agile/lean methodologies pretty well already. However, this book applies the process of agile iterations in software development to business processes. Emphasis is placed on data-driven business decisions based on real product usage, fast prototyping, accurate measurement and tracking of business metrics and creating a culture of speed and agility. Its a must read for any entrepreneur working in a fast changing industry.

Rich Dad Poor Dad – Robert Kiyosaki

rich dad poor dadIts not like this book needs any introduction, but it is the indispensable guide to understanding the mindset of the entrepreneur. It probably took over two years to fully recondition myself from the JOB mindset (also known as “Just Over Broke”), to the entrepreneur mindset. The more work experience you have in the 9-5 game, the harder it is to change gears. This book contrasts the two mindsets through the stories of Robert’s two dads, and shows how they both thought very differently about success and growth.

The Undefeated Mind – Alex Lickerman

Undefeated mindA business is only as strong as its leader, and its leader must have a mind that is undeterred when conditions get hard. The business game is extremely difficult and never really gets easier, but you do learn to react with less emotion and become more strategically precise as the years progress. The Undefeated Mind is not a business book – it is a framework for living successfully. I’ve adapted its principles into my life and my businesses with great success, and think its a must-read for any entrepreneur wanting to find balance in their life.

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December 17, 2013

Twitter Pays Tribute to Madiba

Twitter pays Tribute to Mandela

madiba
December 6, 2013

RIP Madiba

Last night we lost one of the world’s greatest icons – the father of our free and democratic society. May Mandela forever be remembered in history, he was a true legend that never stopped believing in a better future for all people.

He truly lived his life by the poem that got him through prison:


Out of the night that covers me,

Black as the pit from pole to pole,

I thank whatever gods may be

For my unconquerable soul.

In the fell clutch of circumstance

I have not winced nor cried aloud.

Under the bludgeonings of chance

My head is bloody, but unbowed.

Beyond this place of wrath and tears

Looms but the Horror of the shade,

And yet the menace of the years

Finds and shall find me unafraid.

It matters not how strait the gate,

How charged with punishments the scroll,

I am the master of my fate:

I am the captain of my soul.

“Invictus” – William Henley


When Mandela was imprisoned on Robben Island, someone snuck in a copy of “The Complete Works of Shakespeare” and had every inmate circle or underline their favourite passage. Mandela’s is hauntingly beautiful.

“Cowards die many times before their death; The Valiant never taste of death but one”

Mandela is one of those people with such a long and interesting life, first committed to solving South Africa’s problems with violence, he took a u-turn on this policy, and effectively changed the society around him. It is a far more difficult change to make, from violence to preaching non-violence and acceptance. Hence my great respect for the man, who learnt from his past mistakes. Compared to Gandhi for example (who I have great respect for), I feel his message is hence stronger due to this reason.

Because at the end of the day, forgiveness is a far more powerful tool than revenge. And I really hope that with the passing of Mandela, leaders around the world can remember that message.

Rest in Peace Madiba.

Madiba

Chrom Network
October 24, 2013

The Importance of Impartial Digital Measurement in Marketing

Most agency award ceremonies reward creativity above raw performance. Its a subjective showcase of who is the most cutting edge, most creative, most immersive. It has its place and is a great way to show that South Africa is brimming with digital talent across the board. It is not, however, meant to be an objective benchmark of digital performance. Simple proof of this exists – Fuseware’s analysis of the top brands on social media and top content by digital performance have none of the Loerie social media award winners present at all. This isn’t a criticism though, but one must realize that these awards don’t reward what the end result should actually be – how much value has been created for the customer.

In light of the recent Loerie scandal where Metro Republic was stripped of their Grand Prix prize, it got me thinking (more so than usual). As the world migrates to the digital space and everything becomes measurable, surely there is a better way to measure marketing effectiveness. Scandals like these will always be present since they are a result of human error, greed or both. They shed a dark light across the entire industry. Brands lose trust in their agency partners and marketing as a whole is seen as more of a necessary evil than a meaningful way of understanding and engaging with consumers. There must be a better way.

Nobody can deny that marketing has fundamentally changed in recent years. New technologies and mediums have emerged that have empowered consumers with an influential voice and have changed the brand-consumer relationship and way of communicating. These same technologies have empowered brands to understand their communities and influencers in a manner never before possible, but they have been slow to adopt many of these analytical techniques. By and large, the marketing world in South Africa still clings on to old paradigms. Justifiably so, since they cater to where brands allocate budget – print, broadcast and online ad networks receive a large majority of marketing budgets. They capture the largest audiences, but are incredibly expensive and miss the mark with the vast majority of the audience. I believe there is a better way, and that is the way of understanding the consumer on their level. New measurement techniques are needed that focus campaigns to the exact audiences that are interested. New engagement techniques are needed that go beyond the creative ad to memorable content that truly resonates with the consumer.

The undeniable aspect of digital is that you can measure practically everything, and many companies do. The trouble is that they end up sitting on a sea of data that they have no idea what to do with. This sea of data is a goldmine of consumer insight that can position and innovate the brand on a level that was never before possible. However, to truly unlock its value it needs to be integrated across the enterprise and it needs to be connected to the hearts and minds of consumers. Social media data is the single most untapped source of consumer insights on the planet. With over 11m South Africans on Facebook and no slowdown in growth, brands need to capitalize on the opportunity afforded to them to engage on a much more meaningful level. To paraphrase the words of Vincent Magwenya, CEO of Magna Carta, social media has a major influence on traditional media as well as how media coverage gets escalated on a completely different level. The trouble is – almost every major brand is already on social media, so what gives?

As Seth Godin wrote in Purple Cow, “What could you measure? What would that cost? How fast could you get the results? If you can afford it, try it. If you measure it, it will improve”. Companies need to invest in their digital measurement strategies in order to fully understand their customers, brands, competitors and broader market. This data, when viewed from a strategic perspective and integrated holistically from an executive level downwards, empowers the organization with the kind of insight that gives real world results. Results that give customers exactly what they want, and give the business a significant boost to their bottom line. “Spending money on clicks to get traffic” should be replaced with “spending time on engagements to get advocates”. It sounds less tangible and less defined, but with the right measurement techniques can be highly effective, far less expensive with better overall returns.

The challenge I’ve found is that each company measures differently on different levels, and interprets the data in a different way. This is important as each company is fundamentally different at its core, but consistency is needed in order to properly understand and benchmark brands, industries and market segments. Organizations like the MMA and DMMA definitely go a long way to establishing these benchmarks, but I believe more dialogue should be conducted among the industry heads on how to best tackle this beast. The marketing problem has become a technology problem, and technologists need to work with marketers to create the perfect brand of the future.

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October 15, 2013

Why I dropped the Linux stack in Favour of Microsoft

I’ve been a Linux enthusiast for a couple of years now and have run my business off of Linux as much as possible. I run a business specializing in digital research and analytics, which means I need to ensure that my business tech stack is always available, easy to scale, has low resource requirements, a shallow learning curve and ample local talent available. Until recently I’ve coped with Linux for my backend infrastructure and its performed fairly well, but I’ve realized that the pros with going the Microsoft route now far outweigh any cons. Microsoft no longer seems to be the monolithic corporate behemoth of years ago; they’ve adopted a much more agile approach that really benefits small businesses like mine.

I made a slight error in judgement a couple of years ago when I selected Ruby on Rails as Fuseware’s development language and framework of choice. I figured the local popularity would grow tremendously and give me access to a powerful development stack at a fraction of the normal cost. Although Ruby is without a doubt extremely powerful, it has become a burden on my business as alternative solutions have started looking much more attractive. Microsoft have really revamped the way they treat tech startups, and migrating my business to a Microsoft stack has become a must, mainly based on the following changes in the big M:

  • Microsoft sets up Bizspark to allow startup businesses such as mine free access to Office, Visual Studio, Project, Visio among others – including access to a large training and support network and even assisting with funding
  • Microsoft releases Azure and allows for streamlined integration of software on the cloud that connects with all their other products
  • Microsoft starts supporting the Open Source movement with numerous contributions to the community – including a big data framework called REEF
  • Microsoft releases Office 365, which allows small businesses to function completely on the cloud with minimal upfront costs, connected to partners and suppliers seamlessly anywhere in the world
  • Not to mention the fact that you are dealing with an extremely mature eco-system of development tools that are endorsed by the world’s biggest companies
  • The learning curve of Microsoft products have gone way down as they’ve enhanced their integration across toolchains, provide numerous online training resources and have invested in making their platforms’ user experience much simpler
  • Microsoft fully support integration with some non-MS products. I’m sticking with my NOSQL database of choice (MongoDB) for the time being, but Microsoft’s products now seamlessly integrate with it, minimizing my migration workload

From a South African perspective, there are other considerations:

  • Microsoft is aggressively investing in tech startups in South Africa, providing free access to Azure as well as access to their international partner network
  • The local development scene in Johannesburg is almost exclusively C#, Java and C++ based (excluding front-end development). Finding Ruby on Rails talent is both extremely difficult and highly expensive, creating an annoying barrier to entry for smaller businesses looking for talent
  • From a future acquisition and integration perspective, the local corporates seem to favour tech stacks that are consistent with what they already have to minimize integration costs. The Microsoft stack is almost exclusively used by SA’s largest tech companies, making it a no-brainer.
  • The local community of .NET enthusiasts far outnumbers the Ruby on Rails community, which also has developed a bit of a hacker culture.

Ruby and the related Linux stack is still fantastic for quick prototypes at minimal cost. Internationally, its being used in some of the Silicon Valley’s highest profile startups. However, in SA, it seems that the Microsoft route has become the cheapest, easiest and most productive route you can go if you’re an up-and-coming tech startup.

October 14, 2013

Radio 702 Adfeature 2013/10/08 – #ProudlybroughtbyANC

What started out as a fairly innocuous tweet from ANC’s national media liason Khusela Sangoni has turned into the most viral hashtag in recent SA political history. On the back of the DA’s eTolls billboard campaign, the ANC tried to use the hashtag to create a positive publicity spin on Twitter. However, after some ANC heavyweights like Jackson Mthembu and the official ANC Twitter account started tweeting it too, it started devolving on the back of highly negative responses to the positive tweets. Some high profile figures such as Sentletse and Pearl Thusi got behind the hashtag, the conversation reached a tipping point and the masses caught on and made it their own. The hashtag has been tweeted over 30,000 times.

To listen to the discussion I had with Jenny Crwys-Williams and Andy Rice on 702 last week, click below:

proudlybroughtbyanc
October 9, 2013

#ProudlyBroughtByANC PR Spins Out of Control

With over 25,000 mentions from South Africa, #ProudlyBroughtByANC is possibly the hottest hashtag that has hit South Africa in recent political history, bringing satire to everyone involved. On the back of the DA’s eTolls billboard campaign, the ANC tried to use the hashtag to create a positive publicity spin on Twitter.

This Wednesday, Mike Wronski, MD of Fuseware, will be talking to Jenny Cwrys Williams, on 702 at 3pm, about the trend that has taken South Africa by storm.

The hashtag, which has been trending in South Africa since Monday, was first mentioned by Khusela Sangoni, whose Twitter profile states that she is the ANC’s National Media Liaison, and former ANC Youth League Spokesperson. Since then, 6.7% of all people who have spoken about the hashtag have indicated they are affiliated with the ANC in their Twitter bios. The rest of South Africa’s mentions paint a different picture.

@KhuselaK (ANC National Media Liaison) was the first person that tweeted the hashtag with a tweet reading “2 new universities #ProudlyBroughtByANC” at 12:50 PM on 7 Oct.

@shakasisulu, with almost 35,000 followers, joined the conversation soon after, tweeting “@gautrain #ProudlyBroughtByANC”.

@_KushCarter tweeted over 80 times, starting at 1:39pm on 7 Oct, spurring on the voice of the masses, many of his tweets receiving over 15 retweets, despite having only 439 followers. Most of the responses to his tweets were already highly negative.

Starting at 1:46PM, @theafricanchild tweeted over 125 times – very much pro ANC, again the replies to his tweets were highly negative.

Initial thought-leader, Jackson Mthembu got on the proverbial Twitter train at 2:04pm on 7 Oct with tweets like “#ProudlyBroughtByANC Freedom for all South Africans”.

@MyANC_, with 74k followers only tweeted once by retweeting Jackson and receiving 44 retweets. Followers are extremely pro-ANC and had positive response.

After this, the avalanche started gaining momentum as key influencers had joined the conversation and several highly active connected tweeters had started tweeting.

Sentletse (33k followers) and PearlThusi (123k followers) also started tweeted the hashtag after 2pm, and the rest is history. Within 24 hours, many SA celebrities and opposition parties had caught on and joined the fray. It had become the most viral hashtag in recent SA political history.

Twice as many tweets were made from Johannesburg versus Cape Town, of which 75% were from male contributors. Most tweets were made after 5pm when the rest of South Africa could join the conversation on Twitter, including celebrities and influencers such as Gareth Cliff, Helen Zille, Khaya Dlanga, Roger Goode and F1 Sasha.