The last one is really similar to my thoughts on social media advertising. Idea is to let system recommend you different products and services, based on your and your friends interactions with different products, so you don’t have to think (or search).

Descriptive quote from Dave:

I’m the lazy-ass little pig that just wants to find out what the next guy is doing, do the same damn thing, & get back to watching YouTube and knock back a cold one.

To make things more interesting, it turns out that Google has patented mechanism for product recommendation. Smart folks at Google have thought of this a few years back - patent was filled in 2005.

Patent claims don’t explicitly mention social networks, there’s no “friends” in patent. It’s based on collecting data from user interaction with web retailers and then finding similar users and finally do the cross recommendation. Anyway, this recommendation magic could be easily plugged into Facebook.

Patent: Product recommendations based on collaborative filtering of user data

Image by joanofarctan via Flickr

The first kind of advertising is the one we don’t mind to see. If you’re looking for a new bicycle, basically what you do is little research and then go and buy one. For bike sellers it’s smart to be in the middle of the buying process (when you’re researching). When we’re in buying mode we want additional possibilities available so we could buy better. When people know what to search and already have desire for something the SEM works great. This ads are aligned with user’s interests.

But people don’t know what they want or are at least not aware of all the possibilities most of the time, so we would like to make some very smart suggestions to them. Search box is just search box, someone has to type wish inside that it can come true. This is where the other kind of advertising, the one that makes desire for something, comes in.

Looking at front page of amazon.com is a fantastic case when I think about this. The core idea has been there for a long time, it’s nothing new, but it is still efficient. I admit it, I am a fan. Although we have the search box ready to find the specific product, we can easily browse our own personal product recommendations. Recommendations are based on our product buying history and our wish list. Advertising shouldn’t be done much differently. Search & Recommendations.

Facebook had a nice idea how to do recommendation based advertising, but beacon wasn’t done nor promoted right. I can see how this method could be effective for advertisers, but it’s a bit to pushy for the users. It would be a lot better, if facebook would just collect data about user buying habits and do further product recommendations based on that and other data it has. Privacy issues shouldn’t be such a problem, if users have basic understanding of what’s going on in the background and have possibilities to do something about it.

The thing is that people are not in social media for content, but for interaction with friends. This doesn’t mean social media cannot work as a platform for more than one thing. A place where people meet, chat, spend their time, but also have time to look around and maybe “buy” something. What would happen if amazon.com added social aspect to their online shop? would they lost their customers? I don’t think so and I don’t think that adding right “buying mode” to social media wouldn’t work.

Personal recommendations could be the big opportunity to extend SEM effectiveness in terms of conversion rate into social media. All that is needed for good recommendation engine is social map and buying data. In the end this will not generate so much buyers per amount of traffic as SEM does, but should do pretty well in absolute values based on the mass of views generated in social media…

I have to agree with what Esther said in this interview. Advertising will have to go into direction of becoming very subtle and unobtrusive and will have to find a way to enter the conversation. This is undoubtedly true, it’s evolution. Ads integrating with the community.

Search advertising, although very efficient, has its limits. Its use is limited to what people are entering in search box. The recommendation value is low because of this. Classifieds vs. Information.

Contextual advertising is going great and it has bright future in front of it. Getting context out of text works pretty well, image and voice recognition are improving. Nice idea for matching pictures with ads has been mentioned today on techcrunch.

Mixing social data with context. Facebook has some sort of contextual ads, where you can target by demographics and keywords. Keywords are somewhat limited, but this will improve. Google has demographic bidding available for some sites (list). This are experiments into the right direction.

I think the wining combination for ad targeting in more complex environments (e.g. social networks) hasn’t emerged yet, but we do live in fast times (R. Kurzweil would say exponential). When you see some new technology emerging you can bet that this same technology will improve very quickly and be a lot better in one years time. Of course if must solve some problems or be at least fun to use…

Google bought DoubleClick in May and quickly afterwards there was already some “secret” society using display advertising solution made by Google. They moved really fast on this one.

They have acquired Feedburner as a solution for RSS advertising. The percentage of RSS users is still relatively small, but none the less more and more internet people will be using RSS as their news reading solution. Just because it’s more practical.

They have released video advertising solution month or two ago. On FOOA konference in NYC Kim Malone mentioned a few times that we can expect something new from Google Video Advertising. Will it be contextually? Maybe they’ll use their tagged image database which was the outcome from their human computing project - Google Image Labeler.

Other quite popular and new types of internet advertising solution would be in-text advertising and sponsored blog posts. First famous by double underlined links, the other by lots of different arguments for and against. Both quite controversial and hated by many. It would look kinda strange if Google would step into this cloudy pond.

It’s pretty clear. Google wants to be and probably will be all-round solution for internet advertising. I don’t know what all the other big ones (M$, Y!, …) are doing. It sure looks like all the moves from Google all logical from the begining. Based on success of their success from AdWords and AdSense. Well, the big stream of revenue for google is coming from advertising and of course they want it all.

When they’ll have all major internet advertising in place they will have to move to internet users. Traffic. GMail is big, YouTube is bigger, Google Search is even bigger, but there is still lots of users traversing through other internet properties. Lucky guess would be they’ll be buying lots of nternet properties in the future just to secure advertising revenues. These leads to the big internet monopolist. But can Google do this unnoticed?

I just wonder how long it will take before big internet media companies find out they’re feeding the wrong cow and start thinking about adplaces reserved for AdSense.