Seth Goldstein is the co-founder and CEO of SocialMedia, a social advertising platform.
AdExchanger.com: AdKnowledge acquired SocialMedia.com’s ad network last week as noted here by TechCrunch. Where does this leave SocialMedia.com?
We are excited about the transition of our ad network to Adknowledge. This move will allow SocialMedia.com to focus solely on its core business of developing the first social advertising platform. We’ve been a pioneer in social advertising since 2007, by building a Facebook ad platform that allowed app developers to manage, market, and monetize their inventory. Now moving forward, the company is going to bring this level of holistic publisher service beyond Facebook app developers, allowing web publishers to socially enable their inventory across the web
Can you break down SocialMedia.com’s business model? Where does display advertising fit in?
We are 100% focused on developing the first social advertising platform that allows publishers and advertisers to turn any online display advertisement into a social ad, anywhere on the web. We are confident this platform will power the next generation of social ads across the web.
How are you defining a “social ad?”
We focus on three different types of social ads, defined by social relationships. The first type is a friend-to-friend social ad, which enables the sharing of brand opinions between friends by tapping social connections on social networks. Next are ads that elevate brand awareness by broadcasting positive comments by individual influencers (on platforms such as Twitter). Finally, we power ads that amplify brand messages by aggregating community voices and sending the aggregate social message to groups with a common interest. The reason that each type of social ad is successful is because they all provide consumers with more relevant message by relaying the message through a real person – whether a friend, an influencer, or a shared community.
Who are your clients? Are holding company agencies buying from SocialMedia.com or is it primarily direct response advertisers?
SocialMedia.com is no longer an ad network. We are a platform provider that allows publishers to offer social ads to customers. These publishers work with agencies, brands, and sometimes direct response advertisers. We offer the first advertising platform that enables these publishers to make their ads social. Anyone who wants to create social online ads is a potential client — publishers, advertisers, or agencies.
What’s your view on the recent tumult surrounding companies such as Offerpal, SuperRewards, Zynga and the concerns raised by TechCrunch’s Mike Arrington?
I think it’s great to see the evolution of social media monetization towards a more sustainable ad model. Inevitably incentive offers work for a small subset of advertisers — and work quite well — but there are many other ways to be advertising socially and that is what SocialMedia.com is all about.
What’s your view on data exchanges such as BlueKai and eXelate? Will SocialMedia.com participate or does it already?
We think that the world of retargeting and data exchanges is very exciting given the promulgation of open exchanges in advertising market places. We imagine a future where you can reach any consumer you want, at any moment, anywhere in the funnel. But you still have to give consumers a message that resonates, and this is what SocialMedia.com is doing by providing an increasingly social experience in ads.
How do you see the agency model evolving in the next 2-3 years? If you were running an agency, what strategies would you be putting into place?
The agency model is evolving dramatically. The adverting agency industry is going to change as much, if not more, than the financial industry has in last couple years, in terms of the need for transparency and efficiency. Agencies are emerging as trading platforms, as buying platforms, and as investable pools of audience liquidity.
If I were running an agency I would:
- Hire smart quants and traders from former hedge funds and Wall Street firms.
- Set aside a budget for $10-100 million to buy access to proprietary data, join all available exchanges such as Right Media, DoubleClick, etc., and utilize all of the data targeting technology available like you mentioned with BlueKai and eXelate.
- Leverage all the dynamic creative units coming onto marketplace including ours – SocialMedia.com.
- Work with ad clients on a hedge-fund-like model, i.e. collect a management fee but keep any upside from an increase in performance.
What’s SocialMedia.com’s pitch to brand marketers? How do you overcome concerns about brand safety in social media?
Brands don’t have a choice about participating in social: they have to otherwise they will not be brands for very long. Given that they must participate, they must also be careful of their actions. Brand must engage in social in way that preserves and protects, as well as enables and amplifies their core brand qualities at scale.
Brands must think about how to use all the different social channels — Facebook, Twitter, YouTube, MySpace, Foursquare, you name it. In order to reach millions of people at scale brands have to establish their brand qualities, and site-specifically shape those qualities into different environments (e.g. fan page on Facebook, account on Twitter, badge on Foursquare). Brands must make the move from one-off sponsors and applications to establishing a comprehensive and pervasive presence on social media networks. Companies like SocialMedia.com can help them with that.
Follow Seth Goldstein (@Seth) and AdExchanger.com (@adexchanger) on Twitter.
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