Celebrities with a large number of Instagram followers have taken a substantial hit this week devaluing their accounts as Instagram announced that they have “completed a fix to remove spammy accounts.”     Stars like Kim Kardashian and Katy Perry both saw their followers fall by over a million each.

There’s a huge advertising opportunity that lies at the intersection of celebrity and social media.  Mega stars on social media boast audiences of millions of people, with a quantifiable percentage of interaction/ engagement, and brands will cozy up to these celebs paying big bucks to get them to broadcast a message that will help to either sell a product or generate some brand recognition.

Networks and studios spend billions per year pooling together talent, developing and creating content and then marketing it all, but they still can’t garner the kind of followage of the stars they create.  For example Kim Kardashian has 26.7 Million followers as of writing this, but the network that made her a household name, E!, only has 7.07 million.  It’s a bit like a genie that grants a person’s wish to be all powerful.

But a lot of those friends/fans/followers are in fact fake profiles created to give the outward appearance of being more popular among social media users.  There’s also the issue that many stars attract fake spam accounts that are created to piggyback on their fame.  This is nothing new, and social media networks have done their best over the years to stem the tide against fake accounts, although it appears nothing as effective or sudden as the recent move by Instagram.

The fact is that a high number of followers, either fake or real, does have the effect of attracting a percentage of real followers, so buying fake followers wasn’t or still isn’t necessarily a bad investment, when you consider the amount of money stars get paid to broadcast a message from other brands.

 Twitter Experiment:

Someone who works for me told me about an experiment he did for his last job, where he paid $250 for the promise of 10,000 real targeted followers.  Over the course of a few months he saw his followers increase by about 12,000.  But were they real?  He put all his new twitter followers onto an excel spread sheet, assigned a random number next to each one.  After sorting the spread sheet numerically by that row, he took the top 100 and analyzed how often they tweeted, how many followers they had, and who else they followed to determine if they were real and targeted.  What he determined was that exactly half of his new followers were real and exactly half of those followers were targeted correctly.  Though it wasn’t exactly what he paid for, he was impressed by the breakdown.    Was it worth it?  He said in the end that it wasn’t for him.

But at the price of $250 for 10,000 (which is actually pretty expensive in the fake friend market) one million fake friends is like $25,000. Depending on their star power, celebrities can make big money over time from brands looking to broadcast on their accounts.

What do celebrities get paid to advertise for brands on social media?

According to a report from the Huffington post from 2013, Frankie Muniz got $252 per tweet at the low end with only 175,323 followers (he has 214k followers today).   And at the high end there’s Jared Leto (1M followers) and Khloe Kardashian (8M Followers) fetching $13,000 per tweet.  The more famous Kardashian apparently gets a maddening $20,000 per tweet.

Should brands stop paying so much if a celeb’s number deflates though?  Absolutely!    Celebrity in and of itself is a brand, and what stars are experiencing with this ‘culling of the herd’ by Instagram, is a lot like what brands and companies experience on a regular basis from the likes of Google, and it’s the reason SEO or Search Engine Optimization has dominated digital marketing for over a decade.   This is just the cost of doing business.

In defense of Instagram, while this purge of fake friends definitely hurts celebs, there’s a lot of stiff competition among social media networks – and their only real value is in the number of actual people using them.   These networks have to adapt to the way people use them or else some other network will surely come along and blow them away.

Celebs shouldn’t be mad, what is happening through competition and new technologies is just a process of democratization whereby networks and search engines are giving the public more of what they want – actual valuable content.   Should stars stop buying fake friends?  – Stars themselves can only wait and see how often social networks do a purge like this in order to make that call.

Brick and Mortar establishments, small ones included, are getting wise to the mobile revolution. Folks used to talk about ecommerce winning the war over brick and mortar due to its convenience, but companies are beginning to understand the dynamics between that ultra-convenience of mobile ecommerce, and the human need to get out of the house every then and again.

Tell me if this scenario sounds familiar:

You think of something to purchase, and subsequently two other things: 1. where you can get that item, and 2. if getting it fits into your schedule. You then decide to take a shopping trip and some-time later while in the store, you realize that you’re not quite sure where the item is. After having trouble getting an associate’s attention, you find where the item would be, but you realize the selection is meager compared to what you had in your head. After a little internal debate you decide to settle on a product only to then have to stand behind a line of other customers. After the cashier takes 10 minutes to resolve an issue with a customer 6 or 7 people ahead of you, it hits you: “Why am I doing this, why would anybody do this?” You take the item back to its former location (or not) and go home to get the item you really want online.

This scenario is why e-tailers have picked up so much steam over the past decade. When you think of how you can avoid all the pitfalls of on-location shopping with just a few clicks in amazon from the comfort of your home, it’s hard to imagine precisely how the online e-commerce scenario could be improved upon exactly. But it’s also hard to deny that for all its convenience, we sometimes miss going out and getting that item in person. Hence brick and mortar stores are starting to utilize mobile technology to attract new customers and come up with solutions to the problems that were previously frustrating their customers.

So how are they doing it?

Using ads based on Geo location is one example of how a company might use mobile to attract more foot traffic. This is when ads are pushed out within a given radius of a business. Sound complicated? Well Facebook made this exceedingly easy with an ad product dubbed, “Local Awareness Ads.” Businesses can craft their own ad and then choose a radius around their business, e.g., 1 mile – 10 miles, around their address that will reach people within that radius through their Facebook News Feed.

Imagine you were shopping online for say a ceiling fan. You’re online, so of course you go back and forth between your task and your Facebook newsfeed. When all of the sudden you see it, right there in your newsfeed – the exact fan you were looking for, and it’s on sale just a 10 minute drive from your house. You could take care of this task right now. You could even purchase the item online with a few short clicks, then go and pick it up and have it installed in-time for the company you were going to have over this weekend. Why not?

Or…

Imagine you were looking at t-shirts online. You saw one in particular you liked, but decided not to buy it. Later in the week you are walking through the mall, you sit down on a bench for a minute to look at your phone. You look at your Facebook newsfeed when you see an ad for the very same shirt you were looking at earlier, and it’s on sale at a store just 50 short feet from the bench you’re sitting on. Why not?

Target is getting in on the act as well with a couple new features that they are rolling out on their mobile app, just in time for the holiday shopping blitz. One feature is the in-store inventory option, where not only can you browse the items that Target typically has, but you can also see if the Target near you actually has that item. Target is also implementing in-store maps that will direct you to the very isle where that product is located. Gone are the days of wandering around the store looking for an associate wondering if what you are looking for is even in stock.

From the delivery side of things, brick and mortar stores have something that strictly e-tailers do not, and that is locations and inventory nearer to where people live. We’re seeing brick and mortar stores becoming more ingrained into the delivery game, and that is making for some interesting competition.

UBER seems to be throwing its hat in the ring to compete with the likes of Amazon and Google, both also have growing same day delivery services. The difference is that UBER has a fleet of cars and the infrastructure in house that could prove to be quite nimble and efficient – positioning them to forge ahead and grow into industries that they don’t currently reside in.

Another service called Deliv is making people’s lives easier in a number of ways. Using Deliv, customers can check out either on site at a physical location or online, the customer can then choose same day delivery and also a time window for which they want the packages delivered to their doorstep.

In Northern New Jersey, malls and shopping centers are offering same day delivery with Deliv free of charge through the holiday season. People can shop the mall without having to carry around heavy bags through stores and parking lots, rather they can just tell customer service what time they will be home and the merchandise will come straight to them – hands free.

While mobile technology and ecommerce has had a huge effect on the way today’s businesses operate, it doesn’t mean the end for brick and mortar, rather we are seeing a shift of brick and mortar stores using mobile technology to offer more concierge type services. There are so many angles to how mobile technology can make our lives easier that it can be difficult to predict just how businesses may innovate in the future. Industries are adapting to create new opportunities that are making our everyday experience smarter, better, more efficient and more fun.

To say that the way people consume media, or content is changing would have to be the understatement of the decade. While bandwidth and computing speed has continually increased since the 90’s, people have been discovering new digital avenues to interact with news, entertainment, games and even each other.

Some food for thought:

Today, people spend almost a full hour more online than they do watching television, therefore it only make sense that popular Television Networks are beginning to leverage more online content and following models more similar to that of NetFlix.

• Prime time ratings for the broadcast networks were down 5.1% in August, while cable ratings sank a “shocking” 9.8%.
• Even major networks like CBS and Disney reported a major slow-down in TV ad revenue over the Summer, while at the same time acknowledging that ad-revenue is growing on new media platforms.
• In a recent poll from Advertiser Perceptions, 34% of  over 300 advertiser’s and marketers who are planning to increase their mobile ad spending over the next year said that the money for that would come from their T.V. advertising budgets.
• Companies already spend more on digital advertising than either print or radio.

The Past:

Television has been a dominant force in entertainment and information for the past 6 decades.  Well, Television’s reign is ending as content moves online.  Analysts say advertisers will spend more on digital advertising than on T.V. advertising by 2016.  Ironically, the seed that started it all was planted by Cable itself with On-Demand programing.

Of course some might argue it was Digital Video Recorders like Tivo or the standard one in your cable box that started the demise of the Television age, but these services are more like the little brother of the VHS.  Realistically since the 80’s, you could watch your shows whenever you wanted as long as you had the foresight to program your VHS to record it onto a tape, but even then the show had to air before you could watch it.  Also, programing a VHS was hard and most of us were too lazy to learn how, subsequently I never missed Welcome Back Kotter….I was sure to clear my schedule.  Even with the vast interface improvements of the DVR, there was still a scheduling aspect.

The real sea change was on-demand.  On-Demand gave people back control of their schedules allowing them to forget entirely what time their show came on, and instead gave them the choice to watch a program whenever they wanted, also giving people access to a show’s entire back-catalog at once.  If we’re being totally honest, the way that this service works is more like the internet, with servers in a separate location streaming data.

The next iteration of this on-demand type programming comes from internet streaming services like NetFlix Hulu and Amazon Prime.  These essentially work the same way as the on-demand through your cable company does except the hardware is your actual computing devices, which I think we all can agree are infinitely easier to navigate than the clunky interface on our cable boxes.

Once streaming services started developing their own content the future of episodic entertainment started to become more in-focus.   Some of the best “T.V.” shows coming out, are not on T.V. at all, but are streaming from the internet, shows like:  House of Cards, Orange is the New Black, Transparent, Alpha House, The Wrong Mans  –  the list goes on… Net Flix even recently signed a deal to do four original movies with Adam Sandler.    HBO, which has one the most impressive lists of award winning series, will also be offering a streaming only service that is sure to give people one more reason to “cut the cord,” when it comes to cable television.

Cable companies are, at very least, clearly in a transition, and, at most, in a fight for survival.  Over time, the main focus of cable programming may be limited to “live” sporting events and news with some streaming programs mixed in for good measure.

In the next decade, there will be even more outlets like NetFlix and Amazon with their own programming, and all “T.V.s”  will likely be hooked to, or be,  a computer that is connected to the internet.  A world where people are turning primarily towards online for episodic programs is just on the horizon.  However, there is only so many programs we have the time to watch.

So “the Snappening” happened last month, and 90,000 private photos taken by Snapchat users (mostly of an explicit nature) were leaked over the internet.  But according to a new study by Sumpto, the majority of  college students still trust Snapchat and will continue to use it.  My thoughts are that Snapchat isn’t blameless, and  people should be more wary of what they use it for.

So how did it happen?

Someone hacked into a server in Denmark that stored Snapchat photos. If you’re wondering how the photos got on a server in Denmark in the first place when they were supposed to disappear, you’re not alone. In these cases where photos were leaked, the intended recipient (another Snapchat user) was also using a service called SnapSaved that had the ability to save the “snaps” for future viewing, bypassing the original Snapchat auto-destruct feature. SnapSaved wasn’t helping people to save these pictures on their phone necessarily, but rather it was saving them onto this server in Denmark where people would have continued access to those pictures, unfortunately a hacker found a way in also.
Snapchat put out a statement shortly after claiming that its servers are secure and places the blame elsewhere for the “leak.” And I suppose that’s true to a certain degree. If the server where people were storing the pictures was in Denmark, and Snapchat didn’t own it, why then should Snapchat take any responsibility for being insecure? It’s a good argument but I think it redefines terms in a way that is designed to get you to stop thinking about the fact that they cannot address the real problem.

Let me explain:

What is the point of the auto-destruct feature of Snapchat’s messaging about if it’s not a security or privacy feature? There is none. And what would you call the action of giving a third-party a security code that would allow them access to files that were supposed to self-destruct if not a hack? I think “hack” is as good a term as any. So let’s be clear – Snapchat was hacked every time someone used SnapSaved to log into Snapchat and save files, and that was the easy part.

If people were only storing these images on their phone, and people do just by taking screenshots, then victims could claim that their trust was only violated by the person that they intended to view the picture. But since the motherload of pictures were stolen all at once and shared with the entire world, we’re no longer addressing the initial violation of trust.

The problem with Snapchat’s rationale is, most people started using snap chat because of the disappearing nature of the messages. It made them feel more secure and willing to send and disclose more. It’s an interesting statement from Snapchat, where they blame any leaks on their own users, but it’s a bit of victim blaming if you ask me. While Snapchat asserts that their servers (or whatever) have always been totally secure, Snapchat’s service, what people actually care about, has never been and will probably never be. Other people were always the problem with any privacy violation – Snapchat aimed to take care of that with a disappearing message and that just didn’t work.

HubSpot  recently had a very successful IPO, but does it have what it takes to be successful long-term?

Recently it seems we are living in an era where some big tech company seems to launch, get bought, or has an IPO every other week.  The business models for some of them are something altogether untested and new, and their valuations can seem crazy.  The key to understanding the value of HubSpot is understanding what it provides to the consumer and in HubSpot’s case the consumer is business.

HubSpot is a company that designs and offers software as a subscription service to help businesses and marketing agencies market products online.  That means they design tools for social media marketing,  email marketing, content management, analytics, and search engine optimization (SEO)  among many others

My company has used Hubspot’s product for nearly 4 years on all of our contact forms as a lead management tool.   It is an outstanding product but my concern is that it can be difficult for an average user to effectively leverage.  It requires deeper assistance from a web developer and in many cases a marketing expert as well.  Implementing HubSpot’s tools is a major hurdle.

The notion that HubSpot  is entirely a “Software as a service” or SaaS product is also somewhat misleading. The need for manual assistance is required and in turn, makes it hard for marketers to get full value from it. With that said, Salesforce.com has some of the same problems and has become a major player and dominant in the lead management space.

HubSpot has operated at a loss over the last year, of $33 million to be exact, which may seem problematic for investors.  However, HubSpot’s revenue stream is that of a subscription based service and most all software subscription services tend to slump in the beginning.  HubSpot seems to be turning that corner now with revenues last year of $77.6 million on 50% year to year growth.   In February they were given a valuation of more than a billion dollars from The Wall Street Journal.  And that’s not to mention that HubSpot raised over a hundred and twenty million dollars in their recent IPO.

I don’t know if at this point it even needs to be said that inbound marketing and ecommerce are taking over their old counterparts, but that doesn’t mean that businesses understand it.  Digital is the focus of marketing going forward and businesses are in a mad rush to figure out how to get data on their customers and use it to increase their bottom line online, and that’s the niche that HubSpot is filling.

Like Facebook – the value is in knowing the customer, and companies are shelling out big bucks to Facebook because Facebook knows everything about their customers.  But getting someone to click on your link in Facebook really is only like getting them to walk through the door of your store.  What tools do you have to keep customers engaged with your brand and products?  What exactly should you be analyzing to get to know your customers better or at least as well as Facebook?   And how can you tell if your efforts are even working or if you need to change your approach?  These are the tools of the inbound marketer, and it’s where HubSpot excels.

Every company that wants to survive in the future will need to become experts at profiting using inbound marketing techniques.   HubSpot provides business’ marketing teams, and marketing agencies alike with tools and analytics to become online marketing powerhouses.  Hubspot’s IPO will help place more of an emphasis on the digital marketing industry and may cause other companies to follow suit.

I believe that, going public often gives companies the focus to begin to fine tune their product…Facebook is a great example of this.  In my opinion, HubSpot has the right stuff to do well in the publicly held arena and will be a winner.