An Age-Old Problem

Most of us are familiar with the incredible success story of our 2004 Model of Excellence winner, the Internet Movie Database (IMDB). IMDB began life as a Usenet group list, morphing into arguably the first example of a database built with user-generated content. In 1998, the non-profit hobbyist venture was acquired by Amazon.

In those frothy dot com days, it would have been reasonable to expect a huge backlash from all those who had voluntarily contributed to IMDB and watched their effort absorbed by a for-profit entity. But Amazon handled things perfectly. It lavished paid editorial resources on IMDB to quickly prove to users that it was going to make IMDB even deeper and more comprehensive. As importantly, it kept IMDB free. It worked. There was no backlash and usage of the site kept growing. Amazon then linked its DVD catalog to IMDB to increase sales of movies, and that worked as well. More recently, Amazon launched IMDBPro, a paid subscription version of IMDB with even more content for movie industry professionals. It has integrated local movie show times. It added ratings and rankings. Usage has soared along with advertising revenue. It's been a great ride for IMBD.

But now IMDB is embroiled in a truly odd and very public dispute with an actress who doesn't want her real age published in IMDB. The actress, who prefers her age to be listed as age 26-33, was incensed that IMDB listed her as -- gasp -- age 40. She promptly sued Amazon for $1 million.

The basis for the lawsuit? Older actresses get fewer movie roles. How do we know this? Because a study was done of the earnings of older actresses. Of course, if actresses regularly lie about their ages, one probably shouldn't place too much weight on such research.

IMDB hit back hard, with its lawyers calling the lawsuit frivolous and trying to get the actress to publicly identify herself, something they might have thought would force the actress to drop the lawsuit.

But an interesting detail that has got less attention is that IMDB apparently determined the true age of the actress by accessing credit report data when she ordered an IMDB subscription and paid by credit card. If true, this takes editorial research to a new level.

There may be additional facts to this case I don't know, but while I give conceptual brownie points to IMDB for being so committed to data quality, my view is IMDB went beyond the call of duty. Data publishers have a long and proud history of not removing information when requested or threatened, but crossing the line into private detective work is rare. IMDB is also playing in a dangerous gray area when the information being obtained is on an individual and not an organization.

On a more practical level, my guess is that IMDB wasn't doing the same intense research on every actor in its database, and intensely checking only a few actors doesn't help IMDB or its customers. And even if IMDB had made a commitment to getting true ages for all actors in its database, would its customers really care that much? The industry has managed to thrive for many decades despite dubious age data. Do movie producers really want to automatically screen actors in or out based solely on age? If so, perhaps IMDB shouldn't be working so hard to enable such discriminatory behavior. Overall, it seems like a lot of effort for very little benefit ... to anyone.

On the most practical level of all, my recommendation to the actress in this case, as well as to all those who want to take control of their identities: if you are going to lie about your age, don't do it with an age range, just pick a number. IMDB editors probably couldn't enter an age range in their database, and that's probably what prompted the research in the first place!

Call Tracking: The Next Generation

Buying guides and call tracking have a long history together. For over 30 years, buying guide publishers have used various types of call tracking to help document response to advertisers. This is particularly important to these publishers, because buying guide advertising is sold primarily on its ability to generate direct response for advertisers.

In the really good old days when most business was done by postal mail, tracking response was easy. The publisher simply added a suffix to the advertiser's address, so that 123 Main Street might become 123-B Main Street. Advertisers could simply scan their incoming mail for proof of advertising efficacy, and there are legendary stories about buying guide salespeople dragging company CEO's down to their mailrooms to prove that their publications did indeed generate business.

As phone usage became the dominant means of doing business, resourceful buying guide publishers discovered Remote Call Forwarding. With this service, the advertiser would have a unique phone number that appeared only in the buying guide, and all calls to that number would be seamlessly forwarded to the advertiser's regular main telephone number. Best of all, the publisher (not the advertiser) would receive a monthly phone bill that showed the number of calls that had been forwarded that month. It wasn't a lot of detail, but it was hard concrete proof to counter that age-old advertiser renewal objection, namely "I didn't get any calls." Remote Call Forwarding didn't provide much data, was expensive and was a logistical nightmare for publishers, but it worked.

Because of the hassle and costs, publishers were quick to embrace the next generation of Call Tracking, which was based on 800 numbers. Besides lower costs, 800 numbers not only told you how many calls were made to the number, but the phone number of each caller. It was a huge step forward, but many smaller advertisers were reluctant to use 800 numbers in the belief that they wouldn't be viewed as local businesses if they sported a toll-free number. Call tracking stalled a bit for this reason.

The last ten years have seen something of a renaissance for call tracking. Local phone numbers began to become available with all the same data as toll-free numbers. The growth of pay-per-call created a demand for information such as call length (to judge engagement) and even digital recording of calls (to address concerns of advertisers who didn't want to pay for non sales-related calls). But with such heavy use of email to communicate, call tracking seemed destined never to regain its former prominence.

This may now be changing. A Toronto-based company called Telmetrics is a hotbed of innovation in call tracking. It's just introduced software that, when embedded in a mobile phone app, can track calls made from an advertisement with no need for a special phone number at all. And if that isn't intriguing enough, the company now also offers audio-to-text transcription of all calls, and can even scan the text to look for commonly used words and phrases that might inform keyword advertising purchases! It's remarkable stuff, and online buying guides need all the sales documentation tools they can get. 

Less Glitter on Twitter

It's shocking but true: Alec Baldwin has suspended his Twitter account. Apparently, a recent war of tweets with American Airlines didn't yield the support he expected from his fan base, so he's offline, at least for a while.

Interestingly, Alex Baldwin is not the first celebrity to flee Twitter after ill-considered, politically incorrect or just tone-deaf remarks (think John Mayer, Sinead O'Connor and James Franco). And that's just entertainment. Consider the number of politicians who discovered how much controversy could be generated from 140 characters or less (Anthony Weiner and Sam Brownback are just two examples).

When an actor like Alec Baldwin walks away from a medium that provides direct access to over 600,000 of his fans, that's significant. And it points out that social media comes with both power and pitfalls. Consider this from two perspectives. First, part of the appeal of following a celebrity on Twitter is feeling closer to the celebrity because it's the authentic voice of the celebrity, who is encouraged to tweet frequently by the short message nature of the medium. But too much candor and spontaneity can backfire easily. A case in point is Ashton Kutcher, who handed over control of his Twitter account to his publicists after some ill-advised remarks. Of course with that level of safety, authenticity is lost.

Second, there are no rules of the road with social media. What's personal and what is professional? What is public and what is private? Are rants about poor service authentic or inappropriate? Right now, the only way to know when you've gone too far is to go too far.

At a time where toilet paper brands have Facebook pages, where retailers offer gift cards to customers who "like" them on Facebook, where people are finding they can get their grievances with big companies addressed more quickly through a tweet than direct contact, we are all making it up as we go along. And if it's this hard in the B2C world, it's twice as hard for B2B companies trying to formulate a social media strategy. Social media is a mountain road with hairpin turns and no guardrails. And in such situations, there is only one correct response: go slow.  

Power to the People

What jumped out at me in the course of completing a number of recent client research projects is that market leaders in several different verticals were offering their subscription clients not just content, but analysis and sometimes consulting as well. What we may be seeing playing out is the "high tech/high touch" trend identified by futurist John Naisbitt. He predicted the rise of high touch as consumers sought more emotionally satisfying experiences in their business experiences. I think in the world of B2B, it's a lot more practical, but just as profound. Information providers that offer access to an analyst staff are really offering skilled hands to substitute for the reduced levels of support businesspeople have within their own organizations. Where in the past, a corporate staffer might turn to an assistant or the corporate information center to chase down a specific fact or statistic, now these businesspeople are turning to information providers. It's not so much that this is simply the influence of the new generation of workers who can't or won't think for themselves. Rather, what we are seeing is time-pressured people seeking knowledgeable help wherever they can get it. That this help is skilled, readily accessible and bundled into the price of an information product only makes it more compelling.

This trend is larger than just access to analysts. Increasingly, we hear information providers tell us that companies routinely buy not just their data, but additional help in using it and extracting value from it. Many data providers with strong brands in their vertical markets report that they are regularly asked to consult to their clients on big picture issues and industry trends. This move towards advice takes many forms, but it seems to be bubbling up everywhere. Admittedly, it is not a small decision to offer your subscribers access to your analyst staff, especially if you don't currently have one. But I will note that where we see it, such access is almost always a high-value differentiator. I know a number of data publishers who have turned down consulting projects because it is a very different and labor-intensive activity, but sometimes a smart partnership can yield most of the benefit with limited if any downside. My advice: think about offering advice. It's not the right decision for every market or publisher, but it is a clear path away from the "just the facts ma'am" historical positioning of the data publishing industry, and has the potential to deliver a durable boost to your overall value proposition.

Two IPOs That Merit Review

Angie's List and Yelp, both BTC review sites, are now making the leap to public ownership. Angie's List went public yesterday, ending its first day up 25% from its offering price. Yelp has filed papers for a public offering in the near future.  At a high level, these sites are remarkably similar, arguably even a bit competitive. Dive into the business models, however, and they couldn't be more different. Angie's List has a model that defies conventional wisdom: call it a B2C paid community review site. Get this model right and you build something with enormous power: a massive army of reviewers who have a vested interest in honestly and accurately reviewing local businesses because they are paying for the privilege of accessing that same base of reviews. You also get an engaged community, something that advertisers (at least well-reviewed advertisers) are anxious to tap. Indeed, Angie's List reported advertising revenue of $34 million last year, versus subscription revenue of $25 million. The most remarkable feat of all: avoiding real or perceived conflicts of interest while selling subscription access to objective reviews then selling advertising around those reviews. Spend just a few seconds on the Angie's List site and you will see the intense focus on transparency and objectivity. No effort has been spared to make both businesses and consumers feel they are getting good value, trusted information and fair treatment. It's a delicate business model, but Angie's List has been perfecting it for over a decade. Contrast Angie's List to Yelp, which has a free access model in which access to business reviews are free, and revenues are generated from advertising. Yelp has unquestionably impressive metrics: over 22 million reviews, and 61 million users for starters.

But beyond the differences in business models, Yelp is a distinctly different business. And while its free access model afforded fast growth, it has paid a price for being free. As Yelp became increasingly influential among consumers, it started attracting false and biased reviews from businesses seeking to improve their own ratings or damage the ratings of competitors. Yelp responded with a series of opaque algorithms designed to root out fake reviews, but that ended up doing real damage to Yelp's perceived integrity among both consumers and businesses. Even worse, Yelp showed little sympathy to businesses that claimed that demonstrably false reviews were ruining their businesses. That's an especially big issue because Yelp depends on such businesses for advertising revenue. This lack of transparency and perceived conflicts of interest came to a head when a number of businesses accused Yelp of offering improved ratings to those that advertised. It was a PR disaster, but one caused as much by the business model as specific business actions. And that's another place where you see huge contrasts: company leadership. Angie's List is run by Angie Hicks, who exudes Midwestern values and integrity, and is completely aware that while her mission is to inform and empower consumers, her business model can also recognize and reward good service providers, and that works to everyone's benefit. Contrast that persona with Josh Stoppleman, founder of Yelp, who fashions himself as something of a consumer advocate, with businesses of all kinds inherently the bad guys. When the New York Times asked him about a business trying to get Yelp to remove a bad review for a dish it didn't even serve, Stoppleman's nuanced reply was, "why believe the business owner?" After several such interviews, Yelp's PR team finally got Stoppleman locked in a closet for the good of the IPO. It's difficult to say with certainty which business model is stronger. The Angie's List approach has a lot going for it, but it's a hard road to build a business like this, making the company even more impressive. At the same time, Yelp is to date a success story in its own right, but like so many other large review sites, is fighting issues and complications on almost every front. The need for consumer reviews is clearly large and durable, but we are a long way from a firm conclusion as to how they should be collected and presented.