A VC - Latest Comments in The "Feedization" Of The Web (continued)

Re: The "Feedization" Of The Web (continued)

Steffan Antonas — Fri, 19 Sep 2008 15:48:45 -0000

Fred,

I'd be interested to know what you think of iGoogle's new dashboard - it allows users to aggregate RSS with feeds from Facebook, widgets from GoogleTalk, Gmail and others - all as a "homepage". Here's a link to see what I mean - http://tinyurl.com/3qdbfd

Re: The "Feedization" Of The Web (continued)

gregorylent — Tue, 09 Sep 2008 11:42:46 -0000

notice that we have to tell the "machine" what we want and how we want it. which means we already know. we are "preaching to the choir" of ourselves, a kind of endless doubting of what we already know.

sorry to be philosophical, it is a disease i have.

take fred's advice, and start a business!

Re: The "Feedization" Of The Web (continued)

BillSeitz — Tue, 09 Sep 2008 09:01:20 -0000

feed/stream aggregators like FriendFeed seem like they're in the best position to do this.

As a first step, they don't have to "push" things into buckets for new readers, as much as prioritize what you see at the top of your feed.

Re: The "Feedization" Of The Web (continued)

fredwilson — Tue, 09 Sep 2008 08:14:09 -0000

This is so right on

Start a company Joe!

Re: The "Feedization" Of The Web (continued)

fredwilson — Tue, 09 Sep 2008 08:10:15 -0000

I think it would work for both but the execution would have to be different

Re: The "Feedization" Of The Web (continued)

Andy Freeman — Mon, 08 Sep 2008 17:56:12 -0000

I was and am.

You claimed that advertisers wouldn't buy in-feed ads.

I asked why not and have now provided one reasons why. I also suggested one reason why feeds might be a more effective advertising vehicle than sites.

You suggested that the conversion rates (which are per ad) would be different. I pointed out that CPM doesn't matter, the only metric for advertisers is ROI, and that the cost of serving an add is low enough that we can adjust the number of ads to maximize the number of conversions.

Re: The "Feedization" Of The Web (continued)

WayneMulligan — Mon, 08 Sep 2008 16:02:29 -0000

Maybe I misunderstood but I guess I thought you were talking about my original post regarding search advertising. In no way was my discussion related to regular site ads vs. feed ads. So I'm a little confused by the site ads vs. feed ads discussion -- but if that's what we're talking about then I don't think I could make a compelling argument one way or the other.

Re: The "Feedization" Of The Web (continued)

Andy Freeman — Mon, 08 Sep 2008 15:54:35 -0000

[In keeping with the history of this discussion, I'm going to continue to ignore brand advertising.]

It's unclear how we can ignore costs when discussing profitability.

I think that the ad serving cost is low enough that we should be talking in terms of the number (and value) of conversions per user, not per ad. The number of ads can be set to maximize revenue.

Feeds aren't sites. Many feeds come from sites, but the ads in the feeds may, or may not, come from those sites.

I think that feed ads will have slightly better conversion totals (per user) than ads on the site. The base is the same because feeds are merely a different way to read a site. (Instead of converting from an on-site ad, a feed-user converts from an in-feed ad.)

I think that feeds will do better than sited ads because a feed lends itself to "I saw something interesting a while back in my feeds" searches, replacing other information sources. I think that web search advertising will take a small hit but the big hit will be to off-line advertising.

If feed ads from a site have lower per-user conversion totals than ads on the site, said site, and Google (at least as far as that site is concerned), will get lower total revenue. However, if that's the case, where are the missing conversions happening?

Note that users may well move to feeds even if the per-user conversions goes down. Some sites will drop feeds, but they'll still lose users and some revenue to sites that go for volume via feeds.

anamax at earthlink.net

Re: The "Feedization" Of The Web (continued)

WayneMulligan — Mon, 08 Sep 2008 14:32:40 -0000

I wasn't making assumptions about Google's costs, I'm talking more about inventory.

It's the inability to effectively monetize that has left Yahoo!'s revenue growth far behind Google's when it comes to search ads. Google's more effective at conversions and ad monetization.

Cost structure aside, if Google can make $100 serving ad 100 impressions, and we take your example of a site that is 100x less effective at converting, than that would mean that site would only make $1 per 100 impressions. What do you think that would do the company's overall revenue and profitability (assuming identical traffic across both sites)?

This is a great discussion by the way, feel free to email me direct if you'd like to talk about it further: wayne at tickerhound dot com.

Re: The "Feedization" Of The Web (continued)

Andy Freeman — Mon, 08 Sep 2008 14:18:27 -0000

I think that you're assuming something about Google's costs that isn't true.

I'm pretty sure that google's costs to serve an ad are dominated by NREs and account servicing, that the cost to process an insertion are in the noise.

If that's true, Google's costs to 10-100x as many ads would not be significantly higher than they are now.

Yes, feed ads might require additional NREs. And, there might be more advertiser accounts. Still, as long as the marginal cost of ad insertion is low, Google can profitablly handle very low conversion rate ads.

Note that the costs described above do not include the costs of running a search engine. Why? Because the search engine is "just" a way to attract eyeballs. A feedbased system would have analogous costs, independent of advertising. Maybe, like search, they can be paid by advertising, maybe they can't. (I suspect that running a feed system is cheaper than running a search engine. It certainly should have lower NREs.)

Re: The "Feedization" Of The Web (continued)

Melanie Baker — Mon, 08 Sep 2008 12:57:16 -0000

The combination of "feedization" with ever-growing info fire hose (exactly as @Joe Lazarus noted) is precisely our raison d'etre. (AideRSS started as a weekend project by our founder who got tired of being unable to ever get through all his RSS feeds.) Of course, as @Fred Wilson also commented, Google Reader, Bloglines, etc. is only one part of the picture. The list of what *can't* be fed into a feed grows ever smaller.

Good filtering is still a work in progress, for us and any anyone else tackling it, since there's still a lack of standardization out there. Blogs use different platforms for publishing and comments. Not all social media apps have public APIs... the list goes on. A lot of the evolution is still ad hoc, which can have questionable ROI sometimes, as any software/web service company can tell you.

What @stephanelee mentioned is a huge area of potential, too, I think -- relationship-based filtering -- and something I've talked a lot about with our developers. Word of mouth is powerful stuff, so it only makes sense to harness it for managing information, professionally as well as personally, same as we use it for meeting people, finding businesses to deal with, getting recommendations for anything and everything we buy/eat/visit.

I've been pondering the idea of being able to analyze/filter one's network on social sites, allowing you to see not only who's there, but how they engage with the site and others, and how relevant that person's presence in your network is over time.

Solving these issues is still certainly embryonic, but absolutely fascinating given the technological, social, and psychological levels the solutions exist on (I think).

Re: The "Feedization" Of The Web (continued)

Joe Lazarus — Mon, 08 Sep 2008 12:52:45 -0000

I'm picturing something more advanced than the filters provided by those
various services (Facebook, Twitter, Outside.in, etc). For example, I might
follow your feed on AVC or on Twitter because I like your taste in music and
technology, but I might want to filter out your posts on politics, NYC, and
your personal life. Another subscriber might just want your posts on
politics and music.

There's an audience for nearly any content that an individual or company
posts to any of these services, but each subscriber is interested in a
unique view of the feed. As a feed subscriber, I find myself removing feeds
from people where the signal to noise ratio is off, when really what I want
to do is opt-out of certain post types, not the feed in it's entirety. As a
feed publisher, I often find myself holding back on publishing certain
information since I'm worried that only a small percentage of my subscribers
will find that post interesting... and that the others may unsubscribe due
to the noise. The ideal system would encourage me to post information on
any topic that I'm willing to share and then route each post to subscribers
through some personalized "interestingness" filter.

Re: The "Feedization" Of The Web (continued)

WayneMulligan — Mon, 08 Sep 2008 12:09:25 -0000

Fred, in your opinion would a feed-based ad model be more for brand marketers or direct marketers?

Re: The "Feedization" Of The Web (continued)

fredwilson — Mon, 08 Sep 2008 11:32:16 -0000

For direct marketers its all about conversions

For brand marketers its all about impressions

Re: The "Feedization" Of The Web (continued)

WayneMulligan — Mon, 08 Sep 2008 10:59:30 -0000

Andy, I think the problem with our little back & forth is that we're ignoring the other end of this equation -- the publishers.

If Google's conversion rates were 100% less effective, would it matter to the advertiser if they were getting the same ROI? Obviously not.

But would it matter to Google? Of course it would.

That's why search is effective from a consumer, advertiser and publisher end. I can't see feeds doing the same.

Re: The "Feedization" Of The Web (continued)

fredwilson — Mon, 08 Sep 2008 10:56:32 -0000

Not sure I want a toolbar full of feeds. More likey a desktop and phone client

Re: The "Feedization" Of The Web (continued)

fredwilson — Mon, 08 Sep 2008 10:14:22 -0000

You are right to be looking at it this way. This is the challenge and the opportunity

Re: The "Feedization" Of The Web (continued)

Rich Ullman — Mon, 08 Sep 2008 10:06:53 -0000

Great post; great thread.
Feeds will become the critical element for everyone to discover information from the web, because they generally come from a source that's relevant or trusted... and they can filter out the 99.9% of the web that's irrelevant to me.
Marketers will become a part of people's feeds as a means to maintain continued relationships with their customers and to develop new ones. This is how social media will be monetized. Not through "ads" but through the exchange of relevant and useful information.
It's just that right now, most feeds operate at the same efficiency that search did in 1998 when you always had to "click here for the next 20 matches."
That will surely change.

Re: The "Feedization" Of The Web (continued)

Andy Freeman — Mon, 08 Sep 2008 10:03:08 -0000

Do you really think that an advertiser will pay more for a thousand impressions that produce ten purchases than said advertiser would pay for a million impressions that produce a hundred purchases?

That's 100x lower conversion rates but 10x more sales - which is worth more to an advertiser?

If the million impressions cost the same as the thousand, the highest ROI has lower conversion rates....

So, which is it - ROI or conversion rates? They're different....

Re: The "Feedization" Of The Web (continued)

Richard Edwards — Mon, 08 Sep 2008 08:18:42 -0000

What I am interested in is how do I, as a user, discover and consume content as easily as possible.

Search was Discovery 1.0, Feeds are Discovery 2.0

Re: The "Feedization" Of The Web (continued)

100kjob — Mon, 08 Sep 2008 02:35:58 -0000

"So feeds are a powerful way for users to navigate the web and get to the information they need. I expect them to get more powerful over time as more users adopt them."

Can't agree more. What about a toolbar full of feeds?

Re: The "Feedization" Of The Web (continued)

Chris Phenner — Sun, 07 Sep 2008 22:55:05 -0000

I move as many sites' rivers as possible into my Netvibes page, and love FB's feed via BBerry. For those seeking a less-than-obvious, solid RSS reader on the Blackberry, I recommend Viigo (http://viigo.com/download), and would welcome any suggestions or views that there are better (local app) ways to view RSS. All of which is to say "I'm there" and am a huge feed fan -- but I take issue with two allusions of Fred's post.

Issue 1: Feeds "are a powerful way for users to navigate..."
Issue 2: Feeds "will be more powerful than search..."

Pew released 80 pages on news consumption habits (online & offline), and they go back 10 years with some of their poll's Q&A -- rare perspective for the interweb -- and I'm gonna lean on that data to make two points:

#1: "Feeds are Powerful" : Among U.S. consumers, 57% 18-24 "feel overloaded with the amount of news," and that number is 65% for those 25-49. This is data from the current calendar quarter. Feeds are not "powerful." Feeds offer near-unlimited choice and flexibility, but overload is the near-supermajority consensus.

#2: Among those who "read news daily," 82% use search engines for news story discovery (odd to me), while only 12% use RSS -- so that is a big, big gap to close.

The other implicit assumption as Fred mentions his kids' feed-based focus is that his kids will continue to care about the same topics and/or consume in the same manner over the longer-term. This is inconsistent with Pew's results, where 18-24 year-olds care way more about "getting news on topics of interest," but as we age interests shift increasingly to "getting an overview" of the news -- likely as life gets busier. That said, those over age 25 didn't really "grow up" with the social web, so it's hard to say if anything "changed" over time.

I see RSS (like WIFI) has a half-done standard that needs quality-of-service wrapped around it, and I see all of Fred's top site referral sources (two of which I use) as requiring the equivalent of a pilot license to use unless you're all up in the industry. News is the #3 activity after email and search, there is solid gold in those hills.

Re: The "Feedization" Of The Web (continued)

WayneMulligan — Sun, 07 Sep 2008 22:33:15 -0000

Advertisers will pay to be wherever they can get the highest return on their investment. I'd argue that they'd get higher returns on their advertising dollars by going to mediums that best capture a customer's intent. It's all about conversion rates.

Re: The "Feedization" Of The Web (continued)

gregorylent — Sun, 07 Sep 2008 22:08:49 -0000

ads have to be as close to invisible as possible or else you will make enemies, not money. they cannot steal attention or cause interruption. they have to be indistinguishable from content. which means they have to be purely relevant, of great service, valuable, germane.

the best way to accomplish that is to change motivation. instead of trying to get something from people, try to give something. and i don't mean freebies. literally try to improve people's lives exactly as good content is trying to do.

the golden rule is not religious morality, ..... it is a kick-ass business plan.

Re: The "Feedization" Of The Web (continued)

IsaacF — Sun, 07 Sep 2008 22:08:10 -0000

Is anyone doing anything like this already?

I would definitely make use of a live feed of my Analytics, AdSense and AdWords data:

- site x beat its weekly pageview high
- site y cracked $100 today
- site z has a CTR of 5% on 3,000 views for $70
- site y's incoming traffic from Google is down 25% from last week

Right now, I have to log in to three different Google sub-sites and review data from 25-50 domains and, on top of that, try to pick up some of those less obvious items (such as traffic from a particular source having changed dramatically).

Anyone else think there is a market there worth exploring?