Twitter's Super Bowl Goal: More Ad Credibility

Super Bowl sponsor PepsiCo said Twitter employees helped with a hashtag strategy around #halftime. Parker Eshelman/The Wall Street Journal

On Super Bowl Sunday, TwitterTWTR +1.62%will again serve as a grand stage for advertisers to promote brands to millions of people captivated by gameplay, half-time shows and slick commercials.

Super Bowl Sunday will be a litmus test for Twitter as to whether it can convince marketers to hand over more of their ad budgets instead of simply sending viral tweets stamped with hashtags. YoreeKoh reports on digits.

But Sunday's game also will be a litmus test for whether Twitter Inc. can persuade marketers to spend more money to have a presence on the service instead of simply sending out free tweets, hoping their hashtag-stamped witticisms go viral.
In preparation, Twitter has been offering consulting services, grounded in analytics, which it says can lead to smarter tweeting.
On game day, Twitter will feed data to brands like UnileverULVR.LN -0.81%PLC's Axe deodorant to gauge reaction to ads and to predict the next Internet meme before it happens. It will also suggest targeted keywords for ads based on conversation topics, such as blasting tweets to Bruno Mars's fans when he sings at halftime.

Super Bowl Spending Driven by Automotive Ads

A history of advertising spending by company, provided by Kantar Media, shows some trends.

For the past few months, Twitter's staffers have huddled with Unilever and other large advertisers including PepsiCo Inc. PEP -0.89%and Bank of America Corp. BAC -1.06%to share more detailed analysis of user data, and to help with Super Bowl ad campaigns earlier than in previous years.
Twitter isn't charging the marketers for its consulting. The hope is that these advertisers will feel more comfortable with Twitter as a bona fide ad platform and eventually steer more of their marketing budgets that way.

A new study by marketing research firm Communicus finds that 80% of Super Bowl adds fail to lead to actual purchases, or build brand awareness. The firm's president Jeri Smith joins the News Hub to discuss why the study says these ads fails to register with viewers.

Many advertisers still view social media, particularly Twitter, as largely a free vehicle to promote their brands. Marketers have seized on the hyperactive, conversational nature of the 140-character public messaging service as a means to talk directly to consumers.
Twitter, which touts itself as the world's "town square," faces pressure from investors to show it can sell more ads and do it for the long haul. Twitter issues its first quarterly report as a public company next Wednesday. In the three month period through September, its ad revenue doubled to $153.4 million. (By comparison, Facebook Inc. FB +2.44%on Wednesday said its quarterly ad revenue totaled $2.34 billion.)
When the Superdome in New Orleans went dark during last year's Super Bowl, the Oreo cookie brand posted a tweet that said: "Power Out? No Problem." The tweet included a picture of a cookie with the line, "You can still dunk in the dark." The tweet—shared on Twitter and Facebook more than 20,000 times—became a marketing sensation and the standard-bearer of what advertisers could do on Twitter. But it didn't translate into much revenue for Twitter.
In that Oreo vein, brands including Dannon and Toyota have tweeted up a storm in the lead up to the game and plan to tweet plenty more on Sunday, while putting most of their ad dollars elsewhere.
Other advertisers show more promise for Twitter.
Unilever says by working more closely with Twitter it is now more confident that Twitter ads work. The consumer product giant is spending more than $500,000 on its Twitter Super Bowl push, according to a person familiar with the matter.
Twitter's alliance with Axe includes buying a wide range of ads that the social-media company offers and represents a significant increase in how much the Axe brand spent on Twitter during last year's Super Bowl, according Gail Tifford, Unilever's senior director of media for North America. Ms. Tifford says it isn't enough to simply send out tweets organically.
"When you look at reach of organic tweets, you are not reaching the scale you need," she said.
Adam Bain, Twitter's president of revenue, said some advertisers like to experiment with different kinds of organic content, testing out different voices and messages on Twitter. Then, once "they feel confident that a piece of content is strong" they may start paying for ad products.
Josh Nafman, senior manager of digital brand engagement for PepsiCo, which is sponsoring the Super Bowl halftime show, said Twitter employees provided guidance on what kind of content is more shareable on the platform, and helped come up with one hashtag: #halftime.
"I would love to say it seems like a very obvious thing but the coordination of not only hashtag strategy but also when to leverage paid media throughout that" is a difficult trick, Mr. Nafman said.
"A lot of us feel more comfortable with spending money behind" products that are "based in data and science and insights into our consumers and sports and music, said Mr. Nafman.
Twitter has developed or acquired many of its measurement and tracking tools in the past year.
"Our goal is to be as strategic as we can to the marketers and their respective agencies and that means even pre-running ad campaigns before they run ad campaigns," said Twitter's Mr. Bain. "Often times, we're now in the room when they are working on the concept for the creative that is going to run on TV or on digital."
Mr. Bain declined to disclose how much revenue Twitter earns from the Super Bowl.
Bank of America, which will run a Super Bowl commercial featuring U2 performing a new single, has increased its ad spend on Twitter in general this year and said the consulting service could compel it to spend more down the road.
Creative executives' strategist and data analysts from Facebook and Twitter have been helping Anheuser-Busch InBev, BUD -0.72%the biggest advertiser during Super Bowl Sunday, monitor what people are saying in social media for the past few weeks and then helping the respond in real time, the company said.
For example, after Peyton Manning won an NFL playoff game, he said during a press briefing that "what's weighing on my mind is how soon I can get a Bud Light in my mouth after this win."
The brewer, with the help of Twitter, responded quickly to take advantage of the buzz and paid for a tweet that included the video of Mr. Manning talking about his desire for a Bud Light that read: "Proud to be Peyton's refreshment coordinator." The tweet eventually was retweeted 6,200 times with the potential reach of 3.5 million, according to Anheuser-Busch.
Still, it's hard to beat the return on investment for something that is free, namely a regular tweet.
Toyota Motor Corp. 7203.TO -1.27%is paying for only a "handful" of promoted tweets. It will air a 60-second commercial during Super Bowl XLVIII, and use Twitter, Facebook, Instagram and Vine videos to generate buzz. Russ Koble, Toyota's advertising director in the U.S., said he believes Toyota's ad, which features the Muppets, is creative enough that it will be able to sustain buzz in social media without having to pay much for social ads.
GroupeDanone SA BN.FR -0.87%'s Dannon, which will advertise its Oikos yogurt during the game, is spending less than $250,000 on its social-media ads for Super Bowl, including both Twitter and Facebook. Dannon says the actors in its Super Bowl commercial—those from the sitcom "Full House," including John Stamos —have lots of Twitter followers and will be active on the site.

Facebook to buy WhatsApp for 19 bln dollars in deal shocker.

SAN FRANCISCO:  Facebook Inc will buy fast-growing mobile-messaging startup WhatsApp for $19 billion in cash and stock in a landmark deal that places the world's largest social network closer to the heart of mobile communications and may bring younger users into the fold.

The transaction involves $4 billion in cash, $12 billion in stock and $3 billion in restricted stock that vests over several years. The WhatsApp deal is worth more than Facebook raised in its own IPO and underscores the social network's determination to win the market for messaging.

Founded by a Ukrainian immigrant who dropped out of college, Jan Koum, and a Stanford alumnus, Brian Acton, WhatsApp is a Silicon Valley startup fairy tale, rocketing to 450 million users in five years and adding another million daily.

"No one in the history of the world has ever done something like this," Facebook Chief Executive Mark Zuckerberg said on a conference call on Wednesday.

Zuckerberg, who famously closed a $1 billion deal to buy photo-sharing service Instagram over a weekend in mid-2012, revealed on Wednesday that he proposed the tie-up over dinner with CEO Koum just 10 days earlier, on the night of February 9.

WhatsApp was the leader among a wave of smartphone-based messaging apps that are now sweeping across North America, Asia and Europe. Although WhatsApp has adhered strictly to its core functionality of mimicking texting, other apps, such as Line in Japan or Tencent Holdings Ltd's WeChat, offer games or even e-commerce on top of their popular messaging features.

The deal provides Facebook entree to new users, including teens who eschew the mainstream social networks but prefer WhatsApp and rivals, which have exploded in size as private messaging takes off.

"People are calling them 'Facebook Nevers,'" said Jeremy Liew, a partner at Lightspeed and an early investor in Snapchat.

How the service will pay for itself is not yet clear.

Zuckerberg and Koum on the conference call did not say how the company would make money beyond a $1 annual fee, which is not charged for the first year. "The right strategy is to continue to focus on growth and product," Zuckerberg said.

Zuckerberg and Koum said that WhatsApp will continue to operate independently, and promised to continue its policy of no advertising.

"Communication is the one thing that you have to use daily, and it has a strong network effect," said Jonathan Teo, an early investor in Snapchat, another red-hot messaging company that flirted year ago with a multibillion dollar acquisition offer from Facebook.

"Facebook is more about content and has not yet fully figured out communication."

PRICE TAG

Even so, many balked at the price tag.

Facebook is paying $42 per user with the deal, dwarfing its own $33 per user cost of acquiring Instagram. By comparison, Japanese e-commerce giant Rakuten just bought messaging service Viber for $3 per user, in a $900 million deal.

Rick Summer, an analyst with Morningstar, warned that while investors may welcome the addition of such a high-growth asset, it may point to an inherent weakness in the social networking company that has seen growth slow in recent quarters.

"This is a tacit admission that Facebook can't do things that other networks are doing," he said, pointing to the fact that Facebook had photo-sharing and messaging before it bought Instagram and WhatsApp.

"They can't replicate what other companies are doing so they go out and buy them. That's not all together encouraging necessarily and I think deals like these won't be the last one and that is something for investors to consider."

Venture capitalist Sequoia Capital, which invested in WhatsApp in February 2011 and led three rounds of financing altogether, holds a stake worth roughly $3 billion of the $19 billion valuation, according to people familiar with the matter.

"Goodness gracious, it's a good deal for WhatsApp," said Teo, the early investor in Snapchat.

Facebook pledged a break-up fee of $1 billion in cash and $1 billion in stock if the deal falls through.

Facebook was advised by Allen & Co, while WhatsApp has enlisted Morgan Stanley for the deal.

Shares in Facebook slid 2.5 percent to $66.36 after hours, from a close of $68.06 on the Nasdaq.

"No matter how you look at it this is an expensive deal and a very big bet and very big bets either work out or they perform quite poorly," Summer said. "Given the relative size, the enterprise valuations this is a very significant deal and it may not be the last one." – Reuters

Google meets earnings estimates, high costs drag down profits.

Google today announced financial results for the quarter and fiscal year that ended in December. The search engine leader reported consolidated revenues of $16.86 billion for the quarter, an increase of 17 percent compared to the fourth quarter of 2012. Acquisition costs totaled $3.31 billion, or 24 percent of advertising revenues.

Net income in the fourth quarter of 2013 was $3.38 billion, compared to $2.89 billion in the fourth quarter of 2012. Earnings per share in the fourth quarter of 2013 were $9.90 on 341 million diluted shares outstanding, compared to $8.62 in the fourth quarter of 2012 on 335 million diluted shares outstanding. The company holds $58.72 billion in cash and equivalents.

The now-sold Motorola Mobility division continued to see decreasing revenue. The segment contributed $1.24 billion, or seven percent of consolidated revenues, in the fourth quarter of 2013 -- compared to $1.51 billion, or 11 percent of consolidated revenues in the fourth quarter of 2012.

Google segment revenues from outside of the United States totaled $8.77 billion, representing 56 percent of total Google segment revenues in the fourth quarter of 2013, compared to 56 percent in the third quarter of 2013 and 54 percent in the fourth quarter of 2012. Revenues from the UK alone totaled $1.5 billion, 10 percent of Google segment revenues, unchanged from 2012.

Aggregate paid clicks, which include clicks related to ads served on Google sites and the sites of network members, increased approximately 31 percent over the fourth quarter of 2012 and increased approximately 13 percent over the third quarter of 2013. Average cost-per-click across the same network decreased approximately 11 percent over the fourth quarter of 2012 and decreased approximately two percent over the third quarter.

Facebook Like button takes over Share button.

Mashable - Say goodbye to the Share button because the Like button is taking over.

After months of updates to its Like button, Facebook has released an update that fundamentally changes the button's functionality to that of a Share button. Now after hitting the Like button, a full story with a headline, blurb and thumbnail will be posted to your profile wall. You'll also be given an option to comment on the story link. Previously, only a link to the story would appear in the recent activity, often going unnoticed by users.

Though users may now think twice about hitting the button, given how prominently it will appear on their walls and in their networks' newsfeeds, it should ultimately increase traffic to publishers' websites.

Facebook has slowly been rolling out updates to its Like button and has stopped developing the Share Button. Facebook Spokeswoman Malorie Lucich told us that while the company will continue to support the Share button, Like is the "recommended solution moving forward."

However, Lucich today called it a test, saying "We're always testing new products that incorporate developer feedback as we work to improve the Platform experience, and have no details to share at this time." It's unlikely that the change is just a test, however. Typically such tests from Facebook only affect a small number of users, whereas this change affects all Like buttons.

Perhaps the change was necessary. Because it was never made clear to users that the Like button would function differently than the Share button, many never understood what it meant to click Like on a piece of content. Making the result the same as the Share button could build stronger user expectations, ultimately fashioning a better user experience.

Organizers call for second round of demonstrations across China.

Beijing; Nearly a week after calls for widespread pro-democracy protests fell flat in China, organizers are making another attempt at rallying support for the so-called "jasmine" demonstrations for this weekend.

Efforts to organize last Sunday were deemed largely unsuccessful after casual observers and police outnumbered the few protesters that showed up for the demonstrations.

On Friday, anonymous instructions on a site on Facebook, which is blocked in China, encouraged people to show up at central locations in about two-dozen major Chinese cities and "go for a walk" together this Sunday. Along with Facebook, Twitter and YouTube continue to be blocked, making calls for action available only to those outside mainland China or to Chinese who have access to virtual private networks with foreign IP addresses.

Meanwhile, LinkedIn, one of the last social networking sites allowed in the country, was blocked in China on Friday as the government ramped up internet censorship.
'Jasmine' protests fizzle in China

This time around, organizers are masking the events as "liang hui" -- a Mandarin term which commonly refers to meetings held each March by China's political leadership. The cleverly selected terminology is an attempt by protest organizers to circumvent censorship on popular microblogs in the lead-up to actual meetings held by the National People's Congress and Chinese People's Political Consultative Conference.

Words such as "jasmine" in Chinese and "Wangfujing" -- the famous Beijing shopping strip where Sunday's demonstrations are set to begin -- were not searchable on China's most popular microblog, Sina Weibo, on Friday. The Chinese name of U.S. Ambassador Jon Huntsman Jr. -- who showed up at last Sunday's "jasmine" protest in Beijing -- are also blocked.

When searching the terms, users see a message that states: "According to relevant laws and policies, search results cannot be shown."

Huntsman, wearing a black leather jacked with a patch of the American flag on his left shoulder, was captured at last week's protest in a widely viewed video posted on YouTube, in which he's called out by some in the crowd. One asks if he is "hoping China will become chaotic?" -- a reference to the unrest that has consumed several countries in Africa and the Middle East as protesters there demand democracy.

Speaking in Mandarin, Huntsman tells them that he "just came to have a look." The hecklers accuse him of pretending to not know about the protest and feigning ignorance.

The U.S. Embassy declined comment.

For Sunday, organizers have posted details on the Facebook page encouraging participants to be peaceful. In the event of "adverse treatment" the site advised individuals to be as tolerant as possible and show a "high level of Chinese character" in the "pursuit of democracy and freedom., "