Week 6 learnings

This course has taught me a lot about social media and new forms of marketing.  The "learning by doing" model was very effective -- as a result of the course, I am now a Twitter member and have published my first (and second, third... sixteenth) original blog post.  Exciting!  I have a new understanding about the art of maintaining a blog... the photo inclusion, original thinking, consistency, and attention-grabbing headlines is way more involved than I originally imagined.  And the formatting... wow!  The blogs I've followed over the past three years (many) have such a clean, graphic appearance, and I now have a much greater appreciation for the bloggers' efforts.

Here are my key learnings for week 6:

• Online auctions -- Advertising revenue, driven by online auctions, was worth $21 billion to Google last year.  The model saw a major boost when Hal Varian entered the picture.  Varian applied game theory to revolutionize the traditional advertising model (direct selling) and turn it into a two-sided matching system.  Though treated with some skepticism initially, the "Ad Words Select" auctioning system for all advertising spots on the site has transformed the online advertising model and turned traditional advertising technique into one based on algorithms and computer science.  (Secret of Googlenomics: Data Fueled Recipe Brews Profitability)

• Advertising revenue growing -- 86% of Facebook's revenue stream now from advertising, worth $1.09 billion in Q3 2012 and up +36% from the same time last year.  Ads are appearing in users Facebook "newsfeeds" in the form of sponsored posts and app recommendations.  Same method could be applied to Pinterest in its efforts to monetize its business model! (Facebook Q3: Advertising Revenues Up 36% To $1.09B, Now 87% Of The Total Mix)

Screenshot of my Pinterest @ pinterest.com/hannahaarsvold/pins

• Pinterest may be preparing for IPO -- Investors spending an additional $200 million, announced Feb. 2013, reportedly to continue development on technology and features, invest in infrastructure, recruit talent, and expand internationally among other things. (Pinterest Officially Pins Down $200M At $2.5B Valuation)

• Advertising models going through makeover to address the functionality of the web -- In his 2009 article, Eric Clemmons seems to predict the future.  He states, "Pushing a message at a potential customer when it has not been requested and when the consumer is in the midst of something else on the net, will fail as a major revenue source for most internet sites."  The prediction has come true.  2009 saw a decline in advertising revenue due to traditional methods being applied to a new channel.  Today, the model is evolving and advertising revenue is increasing again.  New methods of advertising to meet the online format include targeted ad placement (micro-segmentation), consumer engagement vs. 1-way communication, and use of social influencers to gain trust with consumers.