Back in 2001 when Themestream, the Internet content company I was running, hit the wall, the board was talking through different alternatives.
One idea was to engineer an aqui-hire — we had good technology and a great engineering team. ”A good engineer is worth $1 million in the Valley,” someone said.
Inflation has hit in a big way since then — Yahoo’s price for Tumblr puts the value of each of the nascent company’s 175 employees at better than $6 million.
Admist all of the speculation, theorizing, punditizing and otherwise all-out -izing that has accompanied the news of the deal, there’s a stark truth about the Tumblr deal.
Yahoo has spent 20% of its cash hoard for a group of employees that will make up 1.5% of its total employee base. (Not to mention that Tumblr’s $13 million of revenue would have made up 0.2% of Yahoo!’s total 2012 revenue.)
Consumer-generated content, platform technology, younger demos, hot company, Silicon Alley vs. Silicon Valley are all interesting but ultimately irrelevant.
The real question is how a team of 175 people focused singularly on user experience will survive against the gravitational force of more than 11,000 colleagues.
Big companies exert a unique pressure on smaller companies.
Big companies have mid-level employees who spend their whole day working on administrative issues — HR, finance, infrastructure, resourcing, communications, culture — that grease the operating wheels. They are essential to the smooth functioning of the big organization. Their jobs have purpose.
Small companies don’t many people who derive their purpose that way.
Yahoo!’s entire bet on Tumblr is built around changing the smaller company’s core business model by leveraging Yahoo!’s existing ad resources….tech, people and relationships.
That is going to mean a change to the culture.
No matter what the press release says.
“Per the agreement and our promise not to screw it up, Tumblr will be independently operated as a separate business,” Yahoo said in a statement.
A force of 175, no matter how valiant, is powerless against a cohort 10,000+ strong.
Makes you think of the Battle of Thermopylae….
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For quite a while there’s been a puzzling gap between the advertising value of a user on the web, on a smartphone and on a tablet.
This value disjunction seems counter-intuitive. Adoption and usage of mobile devices has exploded and personalization allows for shrewd targeting of messages to place and time.
Some recent data shows us that the gap between the three formats is narrowing. Mobile devices are increasing as a percentage of overall click-thru and the value of those clicks is increasing.
According to a recent analysis by The Search Agency, tablets have increased to a 9.8% share of the click-thrus on paid search ads in the fourth quarter of 2012, up from 4.2% the year prior. The combined share for smartphones and tablets increased to 22.4%, up from 12.4% the year before.
As clicks have grow, so has the value of the audience.
Ad clicks via tablet devices are projected to account for 20% of Google’s paid-search revenues in the US by December 2013, up from 10.7% a year earlier. according to the report.
The Search Agency data suggests that marketers are still enjoying a discount in the cost per click on mobile devices that is disproportionate to the relative conversion rates of the devices: tablet cost per click was 78% of computer cost per click in the fourth quarter, while smartphones less than 50%.
Personal mobile devices — smartphones and tablets — are going to provide a second life for companies that provide compelling content to consumers. The form factor is a skeuomorphic replacement for the magazine; that shift provides a combination of consumer engagement and advertising scarcity that will help to drive up rates to levels that can support content.
According to eMarketer, the US mobile search market will top $3.54 billion in 2013, up more than 80% from 2012. That’s a sign of what is to come.
Through the epochal shift in media over the past decade, the uncertainty around the behavior of marketers and end-users created a lot of volatility in company valuations.
Today there is more predictability in how current behavior patterns are likely to influence business results.
At the opening of the DeSilva+Phillips Dealmakers Summit earlier this month, I shared some of the consequences of this predictability:
- Everything that go can digital will go digital.
- Undifferentiated information and advertising inventory will continue to expand and decline in value.
- Data and analytics integrated in every aspect of the media and information supply chain will increase value.
As consensus has developed around these trends, and business models have been demonstrated that can be projected into the long-term, there has been an intriguing impact on company values.
In an analysis of more than 70 representative transactions over the past two years, a distinct pattern emerges. Generally, digital media and traditional media transaction multiples have been at a discount to public trading multiples. This discount reflects an acknowledgement of the relative maturity of the traditional advertising-supported media business model. Acquisitions in the media space are generally additive rather than transformative.
In the marketing services, advertising agency and information sectors, however, transaction multiples have been higher than public trading multiples. This is also true in the merging ed-tech category.
This delta reflects the conviction on the part of strategic acquirers that fulfilling these strategic mandates will have a transformative effect on their value.
I’m encouraged by the trend. Not because of the high multiples, but because it creates the kind of deal climate that levels expectations between buyers and sellers, giving companies the opportunity to use their balance sheets to drive growth that can energize their workers, benefit their customers and reward their shareholders.
You can see all the slides from the presentation here: http://www.slideshare.net/danielrmccarthy/key-trends-driving-the-2013-deal-outlook-for-the-media-information-industries. I’ll be issuing a white paper in the next month on the topic.
There are 294 incidences of attempted or actual multiple killings in schools in a database compiled by The Academy of Critical Incident Analysis at John Jay College. These incidents occurred in 38 countries between 1764 and 2009. A total of 672 people, mostly children, were killed.
The database provides a set of facts that both defy and define speculation. As we try to process the unthinkable and engage in sometimes bitter debate about how to thwart future atrocities, I think it is useful to ground the discussion of the unknowable in the things that are known.
Quartz, the new digital pub from Atlantic Media, ran an analysis of the ACIA database that points out a chilling anomaly. The United States has 10% of the population of the 36 other countries in the analysis, but accounts for only one fewer incident.
That is not an abstraction. It is a fact. Such an imbalance requires that a democracy engage in a fair and open dialogue, based in fact, that determines what about our culture creates a disproportionate likelihood that multiple homicides will happen in our schools.
This dialogue would start with understanding what the perpetrator looks like.
There is not much confusion about what school killers look like.
- They most often act alone: 85% of the incidences in the database were perpetrated by one individual.
- They are young: the average age of the shooter was 23 and 50% of the shooters in single perpetrator incidents were between 13 and 20.
- They have been bullied. 85% of the perpetrators were deemed by the researchers to have been exposed to bullying.
- They target their peers or those weaker than them: 31% of the incidences occurred in an elementary or middle school. 45% occurred in a high school.
- They come armed to kill. The perpetrators used two or more weapons in 94.9% of the incidences.
- They kill themselves. 71% of the perpetrators turn their weapons on themselves at the conclusion of the incidence and commit suicide.
These data points make it clear that any discussion of Sandy Hook starts not with the question of “How could this happen?,” but with the specific and constructive question, “What can we do to diminish the likelihood that our schools will be vulnerable to homicidal attacks upon our children by their peers?”
The answer to that question requires balance and self-examination. It means restricting the access to the means of violence. It means increasing security at our schools. But above all it means working to understand how to keep children from experiencing the environmental stressors that drive them to the unthinkable. That requires an astounding amount of empathy, the single attribute that was never present, or had been extinguished, in these solitary and volatile killers.
If we want to contribute to a debate, these are the issues we have an obligation to discuss.
Here is a list of some of the incidents examined in the database. They should never be forgotten.
- Aarhus University Shooting
- Amish School Shooting
- Appalachian School of Law Shooting
- Arvada Missionary Shooting
- Bath School Massacre
- Bremen School Schooting
- Campbell County High School Shooting
- Centennial Secondary School Shooting
- Cleveland School Massacre
- Cokeville Elementary School Hostage Crisis
- Cologne School Massacre
- Concordia University Massacre
- Dawson College Shooting
- Delaware State University Shooting
- Dendemonde Nursery Attack
- Dunblane Massacre
- East Carter High School Shooting
- Ecole Polytechnique MassacreEmsdetten School Shooting
- Eppstein School Shooting
- Erfurt Massacre
- Frontier Middle School Shooting
- Heath High School Shooting
- Heritage High School Shooting
- John McDonogh High School Shooting
- Jokela High School Shooting
- Jonesboro School Shooting
- Kauhajoki School Shooting
- La Trobe University Shooting
- Lindhurst High School Shooting
- Mercaz HaRav Massacre
- Monash University Shooting
- Nic Diedrichs Technical High School Slashing
- Northern Illinois University Shooting
- Osaka School Massacre
- Parker Middle School Dance Shooting
- Pearl High School Shooting
- Pine Middle School Shooting
- Pinellas Park High School Shooting
- Platte Canyon High School Hostage Crisis
- Pontiac’s Rellion School Massacre
- Red Lake Massacre
- Richland High School Shooting
- Rocori High School Shooting
- St. Pius X High School Shooting
- Successtech Academy Shooting
- Thurston High School Shooting
- University of Central Arkansas Shootings
- University of Iowa Shooting
- University of Texas Clocktower Shootings
- Virginia Tech Massacre
- W.R. Myers High School Shooting
- Weston High School Shooting
- Winnenden School Shooting
From a distance we all look more similar than different.
Up close, we all are more different than similar.
If we want to stand out, we have to find ways to make people look at us more closely.
We all know the techniques: dress differently, be loud, be diffident, distance ourself from the norm.
We are sensitive to the risks as well. If we are too different, we run the risk of being ostracized from the group.
That’s a sure thing.
Brands have the same problems, and the sensitivity to risk is heightened by the current disorder in how brands interact with consumers.
As a brand, you want your distinctive qualities to be discernible in every instance. As a brand, you don’t want to lose control.
This means migrating the brand message from traditional controlled channels, like advertising and public relations and sales materials, into new interactive channels, like social media and content marketing, with the understanding that we don’t get to tell the brand story without being interrupted anymore.
I am involved in a lot of discussions these days about migrating a brand message into new media. These discussions are stressful and confusing for everyone involved. The stress stems partly from the confluence of uncertainties: How do we accomplish our communications goals while sustaining our business model?
The starting point for these discussions is usually a brand messaging framework. This is a document prepared by a branding specialist.
These are people who are very good at exploring the unique qualities of a brand, synthesizing the concepts, and laying out the language in a way that it can support multiple communications. They are very good at what they do.
They present the document. Words get discussed. Nuances are tweaked.
Then the meeting ends. The brand message lives on a slide as a series of statements.
That’s not going to work.
To truly create the toolkit for your entire organization and all of your marketing partners to present the things about your brand that are unique, essential and important, you have to turn the slide into a conversation.
Everyone around the table needs to talk to each other. Really, actually talk to each other. Tell each other stories about the brand, describe it, understand it.
When everyone in the room can have a conversation about the brand, using words that they are comfortable with but that have real meaning, then you are ready to begin building your migration strategy.
Not before.
The toll at the Hudson River Bridge in New York doesn’t take cash anymore. A camera takes a picture of your license plate. They send you a bill.
Hold that thought.
Millennials — there are 1.8 billion of them in the world today, so they matter a lot — are wired into their networks on every device you can imagine, all the time. Talk in person? Sure, to laugh about the comments they posted on each other’s profile.
Hold that thought.
Privacy is a voluntary concept for web marketers, the Wall Street Journal concludes. You can’t hide your personal information — dozens and dozens of sites have it. In fact, they have it in such detail that you’d be dismayed.
Another site sharing considerable information, the free dating service OKCupid, sent usernames to one company; gender, age and ZIP Code to seven companies; sexual orientation to two companies; and drug-use information—do you use drugs “never,” “sometimes” or “often”?—to six companies. It also sent an anonymized version of email addresses to a firm that says it uses them to help businesses get information about customers in their email lists.
All of these sites, sitting on megatons of personal data, and when asked the CEOs say, “Trust us, we won’t violate your privacy.”
Reassurances like that make commentators like Alan Patrick of Broadstuff apoplectic.
How do these three things go together?
For marketers and media companies, we’re in a brilliant and fragile moment, fraught with risk and opportunity.
The biggest consumers in the biggest generation of the millennium — the Millenials themselves — are willing to give us that trust in order to give them the tools and resources that create the experiences and connections they’ve come to value. As Pew Research shows, Millenials define themselves by technology and innovation. They don’t mind taking some risks. They embrace the power.
So what if the government is taking a photo of every car that goes in and out of Manhattan and running it against a database of registrations?
So what if a dating site knows who likes girls, who likes boys and who likes both?
Don’t cross the line though. The second we cross that line of trust, the trust that when a Millenial gives you a piece of their digital identity we will use it to their benefit, they will cut us off cold.
What did my Millenial son say?
“Don’t be weird.”
That’s the secret to Millenial marketing. Don’t be weird.
