Timeline looks like nothing else on Facebook – a gigantic mural pushes everything halfway down your page; stories and widgets crisscross what used to be your Wall – even the ads look different.  Like it or Unlike it, Timeline isn’t going anywhere, and there’s a good reason: it will be remembered as the first in a series of master strokes, which allows Facebook to turn rival advertising platforms into MySpace.

For those users who can trace their roots on Facebook back to the beginning, Timeline recalls the tectonic shift achieved with the introduction of the News Feed, back in September of 2006.  A full 20% of all time spent on social networking sites is framed by Facebook’s News Feed…and no product feature deserves more credit for the company’s unanswered growth over the course of the last 5 years.  It smartly offered an alternative to the tedious profile-to-profile commute, required to keep up with your circle of friends on other social networking platforms.

MySpace leapt ahead of Friendster with customizable CSS (Cascading Style Sheets).  Facebook lapped both of them with personalized RSS (Really Simple Syndication).

Timeline allows the sharing of an entire life story…all on 1 page.  The delightful irony is that its true value — and brilliance — is bound up in stuff that’s not new at all. By providing easy access to a lifetime’s worth of content, Facebook has found a way to monetize its entire “back catalog”.

The News Feed, as well as its scrappy nephew, Ticker, profit from delivering the most up-to-date content.  Whereas, Timeline thrives on nostalgia and selling you back your crusty Spring Break photos which you were certain you had deleted.

Facebook is not-so-secretly engineering their own Google killer…in plain sight!  Check back soon to see what happens in Part II.

By Jonathan Wood, Director of Operations at XA.net

What’s more, this stuff is complicated, especially for delicate creative minds at agencies and marketers. “I don’t think brands have their heads around how to use it and it needs scale to succeed,” says Toland. “Going from one verb (like) to an infinite number is complicated for a marketing person to understand. And a lack of simplicity leads to a lack of scale, which leads to a lack of advertising opportunity.”

As a result, it will be up to the app developers to provide what marketers need, says Rob Leathern, founder and CEO of XA.net, an ad technology platform. “The developer ecosystem will be essential to helping brands understand what it’s useful for and how best to use it,” he says. “I suspect it will be buggy to use as a partner initially, and you won’t see serious ad action against it for a couple of months, apart from some early adopters.”

The Fruit Pie and Twinkie are certainly not gone, but the financial health of the company is in serious question having filed for Chapter 11 today according to the Wall Street Journal.

So one might guess that perhaps not enough people love them. Social media provides some clues. Only 176,000 or so people in the United States “like” Twinkies or Hostess Brands according to Facebook. Here’s things that people who like Hostess Brands and/or Twinkies also tend to like (the Penguins no doubt a home-town shout out for many of the Twinkies lovers):

I thought that, like the kid that I was reading the comic book, many of the people professing their fandom for Twinkies would similarly be kids. But in fact that isn’t the case as the age data shows. Here’s what the average age index (compared to Facebook from an overall perspective) for these snack lovers look like. 20-40 year old women seem to predominate. So perhaps, there is a tinge of nostalgia among these folks about a once-loved snack food?

What is different about the targeting data that’s available through Facebook versus anywhere else?

There are two things that are important. One is that it’s the most robust and largest source of self‑reported demographic data available anywhere in the world. No one else is even half the size of Facebook in terms of the amount of data. You can do demographic targeting on a variety of other large portals, or use data from third‑party vendors, but the quality of the data is low and you’re never going to get more than about 40 percent of the online audience. Whereas with Facebook, they reach 165 million people in the US monthly, and they have age and gender information on 95 percent of them.

The second thing is for brands. Facebook has this ability to target people by affinity: brand affinity, affinity of products, affinity to causes and more. The more that companies are spending time creating and driving customers to “like” them, the more targeting data is becoming available on this platform.

Hopefully, in the future, this data will be, targeted by marketers outside of the walls of Facebook in a privacy‑sensitive way since the walls between Facebook and websites have continued getting lower.

Why is it that advertising works on Facebook without first‑party cookies?

The signal that exists in Facebook is strong if you’re smart enough to know how to target users. The reality is that you’re not going to always target every single user you want. Nobody has built a targeting system that is very powerful, and/or generates a lot of money with the one exception of Google.

Google is the only company that has taken user‑supplied data, and has turned it into a meaningfully-sized business. Facebook hasn’t yet either, but everyone believes that they have the potential to do so.

For marketers, Facebook’s quality of data and the value of their data for targeting purposes are continuously increasing. Every dollar that is spent by a brand to drive fans towards their brand is also continuing to grow the power of this platform from a targeting perspective. It’s what you might call the ultimate network business.

Can you talk a little about the evolution of your business? I used to think of XA.net as a self‑service DSP. It feels like you’ve pivoted into the social space.

I don’t think we’ve pivoted at all. Our goal starting the company was always to be in a place where we could have the biggest impact helping marketers run advertising campaigns – systematically, profitably and with less pain. Any platform where many users are likely to pay attention to an advertising message is somewhere we want to be integrated. Facebook has fit that criteria, LinkedIn is one that we’re participating in right. At some point, perhaps Twitter will be in that category. But we’re interested in scale and the ability to tap into a platform systematically.

What I think has changed for us is that we have recognized the social data component. The understanding of that data is going to be an important part of creating value for marketers going forward. We have devoted additional resources in order to get much deeper on the social side than anyone who superficially puts out a press release announcing, “Oh, we’re a DSP and now you can buy social through us.”

We’ve focused our technology development efforts on the social side, not just as a workflow product to help you buy ads more efficiently, but also to understand the audiences that you have and the audiences that you could have. I wouldn’t say it was a pivot. It’s more of a continued concentration of focus in an area that we think is going to be key to unlocking value for marketers.

Speaking about those marketers, who is the ideal client for XA.net today?

We’re working with marketers directly and through their agencies. In some cases, agencies and the marketers themselves are both involved. In other cases, it’s just through the agencies as a service provider to them.

A good example of a very sophisticated company that we’re working with is One Kings Lane. They don’t necessarily have a deep agency relationship so we’re working with them directly.

Also, we’re not in the business of working with small businesses. We have some channel partners that we work with but most of our customers are large or mid‑size enterprises or agencies. Our minimums for display and/or for Facebook are $10,000 a month.

Any thoughts about how commerce is going to change because of social media?

Companies are going to find it useful to tie user purchasing behavior or recommendation behavior more closely into the existing social networks that exist out there. We work with a lot of companies who are trying to understand things like influential customers. Are the influential customers the same ones who are spending the most with them? It’s usually not the case. You may have an influential customer who can spread the word about your product or service that isn’t necessarily the biggest spender on your product or service.

The big trends are going to be tapping into influence and creating viral offers that are spreadable.

The other trend will be companies tapping into existing databases of their most valuable customers and getting them to advocate on their behalf within these social networks. Companies are going to get these users to encourage other users to become fans, to make purchases or to learn more about new products.

There’s this new opportunity for existing, valuable customers to be the voice of the brand which will increase with more social media opportunities and integration.

With XA.net, the overall idea is to provide a media‑buying platform that spans both the social‑‑when I say, social, I mean Facebook, Twitter and LinkedIn ‑‑and also the Google world, the search world, right? It would seem, from a marketer’s perspective, that they really need one platform to control both. Do you agree with that?

Yes. I think where we come down on it is that the search business is one that’s been around for a while and there are a lot of solutions out there already. We think that a targeting optimization problem is a much more difficult one and a much more diffused one. Our goal is to have a platform that helps marketers across that spectrum which includes what people traditionally today think of as display or social display.. We see ourselves as having a role to play when there is an existing relationship between the company and the customer.

In the past, with search for the most part, there was no pre-existing relationship available when someone goes to a search engine and searches for a company. We’re going to be in the business of both acquisition as well as retention, and helping companies understand the value and tradeoffs between how they communicate with customers through these various online channels. But search is not currently a part of what we think our customers are typically looking for.

There are a bunch of search marketing companies that have created display platforms or social platforms. What we hear almost universally from customers that we talk to is how, in many cases, the only reasons they use those add‑ons is because they’re paying next to nothing for them. The problem is they’re missing a lot of opportunities because they’re getting very little actual value out of those platforms. We think most marketers are smart enough to go to the best‑of‑breed. We have no interest in being a search provider, but we believe that, on the social and display side, we are a best‑of‑breed provider and can help them out.

What do you think is the biggest gap right now in terms of skill set in digital? Sales? Marketing? Engineers?

First, people with the best and most transformative technology, and the people with the loudest and most effective sales voices are not usually in the same company. I think the inefficiency is in a lot of good salespeople who sell inferior products, and a lot of good technology companies do not yet have the similar salespeople to sell their products. That’s one of the things out there; it’s just a reality. It’s hard to find great talent right now even though there are a lot of people in the market.

On the sales side, there’s an acute need for expanding the base of salespeople who can help translate some of the amazing innovation that’s happening week‑by‑week into the hands of customers. Part of the problem is that it’s hard for customers to understand, because things are changing so quickly. I see that as the biggest area that the industry needs to work on: we need to align the messaging, capabilities and the customers’ understanding of all of the above into a single package.

You have a product called optim.al which focuses on the development of ad creative. A lot of creative people out there are concerned that automation has taken money out of their pockets. What are you seeing about that creative role and how it’s evolving in social?

If it appears like some doors are closing on the creative side, it’s out-weighed by others opening. In certain systematic systems we are working with, companies that have their creative partners login to our own optim.al tool and submit the creative. Some of the creative thinking may be different in that now they think about adding and creating a group of elements that work together. These new tools help creative people figure out new ways of interaction with the consumer. The best thing in our system is the real-time aspect. Within 10 seconds of an ad being turned on, they can receive feedback – it’s potentially a different world than creating a magazine ad, and having it run a month later without actually knowing what the reaction was among consumers. For creatives, there’s this opportunity to engage very meaningfully, and then get almost instant feedback from those creative ideas.

We’re never going to be in a situation where we don’t need creative minds to come up with things that are going to grab people’s attention. The targeting and the matching of the creative to the targeting – all of that stuff can be made more systematic through systems like ours. But the inputs are always going to need to be creative, and you’re always going to need people to think “outside the box” to come up with those components.

Looking into XA.net’s future, what are some milestones that you want your company to achieve?

We want to be seen as the go‑to authority for social and data‑driven media buying.

The other thing I would say is that so far we have been a company focused on building technology. We’ve done pretty well in terms of, given our size, getting into the marketplace and having top‑notch customers. The next two years for us is about building a sales and marketing presence, and getting our name out there. That will be our focus for a while. You’ll start to see more announcements around that.

- John Ebbert, AdExchanger

http://www.adexchanger.com/the-state-of/xa-net/

• Newbies: no Facebook presence… unlikely. Or unlikely you’ll have the brand gig much longer. Even if it’s not much to look at, someone in your org already dipped the collective toe in the water and threw something up! Executive buy-in? Your CEO probably still has their emails printed out and read to them.
• Organics: You set it up but didn’t do very much at all; people who love your brand, naturally banded together. You post some news and stuff on the page from time-to-time, no big deal. Your CEO just got onto LinkedIn and thinks it’s pretty cool.
• Cheapies: you spent a little dough, bought some fans, and have a sneaking suspicion they’re not really that valuable for your brand…but, how can you really tell? The CEO keeps asking “what are we doing in social?” and tells you how awesome it is that he can “tag” people in FB photos.
• Diggers: you spent A LOT of dough, bought a boatload of fans, and your app/page has 5-10 different apps, tabs, offers and stuff you don’t even recognize anymore. The CEO emails the board weekly that “we’re catching up to our competitors’ fan numbers” and still finds you daily to tell you his “like” count.
• Nirvanas: you’ve got this whole social ecosystem sorted out. Your fans are monetizing. You’re tracking ROI in 6 dimensions, you’re running all three/six/nine “Sponsored Story” types and your always-on, real-time page management (and ad management) modules are optimizing every 10 seconds, based on a proprietary social graph analysis. The CEO is hanging out in your cube.

So, by a show of hands, who’s a 5?

Naturally, Nirvana remains elusive for most companies and brands who are somewhere in the middle, but a small set of general principles can be applied to Organics, Cheapies and Diggers, which help move the organization toward a more user-centric and meaningful social position.

Here are three (3) keys to success that we’ve seen with brands in the space that are doing Social well:

1. Analyze Your Existing Fan Base. Seems logical, right? You’d be surprised how many brands don’t take the time to do this critical 1st step. Figure out where you are; who are these fans and how do they map to the consumers you traditionally sell your product to? It’s important to not only understand their demographic profiles, but also the “interest clusters” which can help you drill-down to those people who have a genuine affinity for your brand. If you’re like most, you’ll want to go beyond the standard set of metrics Facebook provides – there are companies (yes, like ours) which help with this, but even a little exploration on your own can yield good insights.
2. Leverage Organic Fan Segments. Even if you’re a “Digger” and bought your fan base that now bears little resemblance to the people who actually buy your product in the real world; there are likely quite a few brand advocates for whom relevant messages possess real resonance. They may currently be drowned out in the wash, but if you can capitalize on your analysis and use things like Sponsored Stories (which also use targeting), you can more easily locate those real brand fans.

We worked with a luxury car brand who determined that most of their 3MM+ fans were half the age of their average buyer and were therefore unlikely to buy. That said, within their group we isolated at least 200,000 core users which the brand could start to build some productive programs around…and get these core folks to start sharing brand-related content with their amenable peers. This is essential, since every “degree of separation” provides a weaker signal; brands must logically start with their strongest fans, and branch out in concentric circles.

3. An Always-On Testing Mentality. Most brands we’ve talked to are primarily accustomed to thinking in terms of big campaigns and short-term “burst” initiatives; but, the always-on, dynamic nature of social media compels an everyday learning approach. Every test you can do – when the stakes are low – equates to a greater chance of success when volume is needed and the stakes are much higher. Rapid deployment and consistency are important as you test. The smart use of Facebook ads (including Sponsored Stories) targeted to segments of your user base and their connections (“friends of fans”) allows you to try out messaging, discover attention-grabbing images and figure out what resonates…to whom…when…and eventually, why.

Your fan page posts may only be seen by 3 – 7.5% of your fans, according to recent numbers compiled by All Facebook, but when reinforced by this new form of social retargeting, you can ratchet up your engagement stats.

And while the CEO may not be hanging out in your cubicle, perhaps they’ll at least start talking to you in the break room.

SAN FRANCISCO, CA – September 14, 2011 – XA.net, the leading provider of data-driven social advertising optimization, today announces a strategic partnership with Getty Images.  Under the terms of the agreement, XA.net will gain access to an extensive breadth of Getty Images’ imagery, for use in its proprietary Facebook Advertising Platform, optim.al.   Users of optim.al can now incorporate over 1 million premium quality images directly into their multivariate ad campaigns running across Facebook.

“The world-class content of Getty Images provides our clients with a distinct advantage on Facebook, where Getty Images’ vast library and metadata can be used to create ads our system optimizes in real-time,” said Rob Leathern, Founder and CEO, XA.net. “This long-term licensing partnership with Getty Images adds yet another compelling feature into our optim.al advertising platform.”

As the first, real-time, multivariate ad creation and optimization platform, optim.al is configured to deliver against any goal a partner may have on Facebook: installs, conversions, likes, or clicks.   Users create robust advertising experiments in optim.al to seamlessly determine the exact combinations of copy, images and targeting to return real results and data-driven insights.

“XA.net helps advertisers reach millions of Facebook users,” said Craig Peters, SVP of Business Development at Getty Images. “We look forward to seeing the ways in which XA.net’s clients utilize our quality digital content to improve their communication across the vast social media ecosystem.”

About XA.net

XA.net is the first advertising technology company to be both an approved Facebook Ads API Tools vendor and have built its own robust real-time bidding and audience infrastructure, integrated with all major ad inventory sources.  Based in San Francisco and backed by a proven team of social media and audience experts, the XA.net team created optim.al , the leading multivariate ad platform for Facebook.  Visit optim.al to learn more about the company’s media and data products.

About optim.al

Optim.al provides a cutting-edge platform to create, manage, track and optimize social media campaigns in one powerful, audience-driven system.  Companies can now efficiently achieve both direct response and branding objectives with socially-linked ad campaigns.  Approved by Facebook, this platform delivers rich audience analytics and data-driven results.  Visit optim.al/signup-gold and register for our free 7-day trial.

About Getty Images

Getty Images is one of the world’s leading creators and distributors of still imagery, video and multimedia products, as well as a recognized provider of other forms of premium digital content, including music.  Getty Images serves business customers in more than 100 countries and is the first place creative and media professionals turn to discover, purchase and manage images and other digital content.  Visit www.gettyimages.com to learn more about how the company is advancing the unique role of digital media in communications and business, and enabling creative ideas to come to life.

Marketers can use the knowledge available in one social domain to inform targeting decisions in another, letting the full richness of data in the social web bleed through an entire portfolio of digital campaigns.

For example, LinkedIn lets advertisers target its users according to more then 140 sector classifications.   We took LinkedIn’s sector taxonomy and applied it to the 70,000+ workplaces addressable to Facebook advertisers.  We then looked at how fans of presidential candidate and Ames Straw Poll victor Michele Bachmann index by sector, on Facebook.

So, for example, a Michele Bachmann fan on Facebook is 3.4 times more likely to work for a religious institution that an average Facebook user.  The results jive pretty closely with what you might expect from a Republican primary candidate like Bachmann.  She indexes very highly against  stalwart Republican sectors like energy, defense, and religious institutions, and she performs poorly against traditionally liberal sectors like entertainment, technology, and education.

So, what cities on Facebook have the highest proportion of college graduates?

Find out now on our optim.al blog!

Americans aged 42 and older are underrepresented in Facebook. Here is the data comparing recent US Census results with Facebook penetration by year (all indexed to 100). Note that Facebook bundles people 64 and older together. So did we for this graph for Census data, and that group was particularly underrepresented. Grandma and Grandpa may be on Facebook to a greater extent than ever before, but we’re still a long way from it being representative of the US audience.

“Unlike many tech companies whose systems only think in terms of ‘keywords,’ XA.net’s roots in audience-based advertising differentiate them within the media space,” said Robin Kent, Founder of The Fearless Group and former Chairman & CEO of Universal McCann. “As a new agency, we’ve found the XA team and technology to be very helpful to us in quickly scaling both our display and social spending globally.”

A pioneer in display advertising since 2008, XA.net has built its own real-time bidding integrations with ad exchanges including the DoubleClick Ad Exchange, AdMeld, the Rubicon Project, AdBrite, CONTEXTWEB, PubMatic, OpenX and the Yahoo! Right Media Exchange.

“Companies are approaching us as a leader in Facebook advertising optimization and quickly realizing the additional benefits of combining social media, retargeting and audience targeting via real-time bidding,” said Rob Leathern, Founder and CEO of XA.net. “It all starts with social though, with optim.al.”

Optim.al’s multivariate ad and targeting testing is the most effective way to determine winning combinations of image, copy and targeting elements on Facebook versus running every possible combination.

“Optim.al has been the ideal platform for us to execute conversion-oriented multivariate tests within Facebook,” said Keith Moore, CMO of AcademixDirect. “The coordinated learnings we are accumulating and time we are saving on a daily basis is driving real ROI for us.”

For a limited time, XA.net is offering a special advertising package for advertisers that sign-up for both its real-time bidding and social media tools at http://be.optim.al/offer

About XA.net
XA.net’s audience-based ad technologies have optimized over 65 billion impressions for advertisers and agencies since its founding in 2008. XA.net is based in San Francisco and has received funding from prominent advertising technology investors including Jonah Goodhart, Noah Goodhart, Jerry Neumann and Michael Walrath.

Press Contact:

Gita Vaysburg

415-329-7110 ext109