Facebook and Instagram's Effect on Brands

Facebook's recent $1 billion acquisition of Instagram presents new challenges to and opportunities for marketers. For brands, this acquisition is an opportunity to strengthen their digital ecosystems by leveraging both platforms consistently and encouraging deeper engagement with consumers.

While Instagram doesn't currently have an ad program, companies like Instagrid Network want to connect brands with Instagram users. Their idea is to set up programs that pay top Instagrammers to share photos of a brand's products.

Because Instagram is all about sharing pictures, some companies are realizing that an artsy tilt-shift photo of the bag of chips you're eating could actually be worth something.

These paid endorsements will be unobtrusive, and will look exactly the same as every other photo populating your feed. Kevin Systrom, the CEO of Instagram, says, "It doesn't feel like advertising when you open Instagram - it feels like entertainment."

While the partnership between Facebook and Instagram will attract many new users to join the Instagram community, brands need to keep in mind which channel is more relevant to the brand and its consumers in order to reach their target market effectively.

Newspapers are Becoming Old News as Social Media Takes Over

This week, Mashable posted an article about the influence of social media on the news industry. It is no question that websites such as Facebook and Twitter have become more and more important in the world of current events. However, there are pros and cons to social media news. On a positive note, the Internet allows immediacy, everyone can report the news, stories disseminate quickly, and cell phones can go everywhere. On the other hand, there is less room to tell the story (140 characters on Twitter), inaccurate facts sometimes, journalistic integrity could be compromised, and amateur reporters put themselves or others in harm's way to get the scoop.

These are some interesting statistics I found regarding social media news:

• Over 50% of people have learned about breaking news via social media rather than official news sources
• Hudson River plane crash - Twitter
• Whitney Houston's death - Twitter
• Announcement of the royal wedding - Twitter
• Egyptian uprising - Facebook
• 46% of people get their news online at least three times a week
• As of 2012, online news revenue has surpassed print newspaper revenue
• Facebook is the strongest online news source, with 59.5% of users
• 49.1% of people have heard breaking news via social media that turned out to be false

While social media news has its advantages and disadvantages, one thing is undeniable: it is here to stay. Getting the news online is becoming the norm for most households. In a few decades when the new generation takes over, I believe that newspapers will become a thing of the past.

Smartwatch Makes Life Easier for iPhone Users

While several smart watches have been introduced in the past year, they were all powered by Android, or connected to Android smartphones only. iPhone users were out of luck, until yesterday.

Eric Migicovsky, of InPulse, created the first smart watch that can sync with any iOS device, as well as Android. This watch, called The Pebble, makes life easier for smartphone users so that they don't have to take their device out of their pocket just to check the time, change the tune, check an email or see who's calling. It features an e-paper display for improved visibility in direct sunlight, has a built-in motor for vibration alerts, and an accelerometer.

The Kickstarter campaign asked for $100,000 in funding, and reached that in the first two hours. Not only that, but currently the project has managed to amass over $1 million so far, and it's only been one day. Around 8,500 people have invested money toward the project.

This has been such a promising investment for many people because most devices that work with smartphones have proved to be very successful in the past. There are expected to be one billion smartphone users by 2014, creating a large target audience for products such as The Pebble.

Facebook Acquires Competitor Instagram

On Monday, Facebook announced its largest ever investment. The social network bought Instagram, a photo sharing app, for $1 billion in cash and stock.

Mark Zuckerberg says on his Facebook page that the acquisition is "an important milestone" for the company because it is the first time it has acquired a product and company with so many users. Instagram currently has more than 30 million users who upload more than 5 million pictures every day.

The introduction of Instagram on Android devices last week was a potential threat to Facebook, attracting thousands of new users signing up at a rate of more than 2,000 people per minute.

"Facebook will never make that $1 billion back, but it's still smart," says Patrick Moorhead, principal analyst at Moor Insights & Strategy, who called Zuckerberg's move defensive. "Instagram was the only thing challenging [Facebook's] dominance in photo sharing."

Photos have been a key part of Facebook's growth and popularity. On average, 250 million photos are uploaded on the social media website per day. By acquiring Instagram, Facebook knocked out one of its main competitors.

The move is also likely to give Facebook a greater ability to profit from its mobile applications, a part of the company that has yet to generate "any meaningful revenue" from, according to the social network's IPO filing.

Google Continues to Innovate and Amaze

Google is onto something, once again. Last week, I posted about their innovative driverless car. This week, they introduced yet another product that will change the world of technology as we know it: Project Glass.

Project Glass is part of the "Google X" special products division, which is the same division that has been working on self-driving cars. These new glasses take all the functionality of a smartphone and place it into a wearable device.

A person wearing these glasses can control music, get directions, take pictures, give voice commands, and conduct video chats. The lenses will also display everything from text messages to maps to reminders.

"We think technology should work for you -- to be there when you need it and to get out of your way when you don't," the company said on its Google+ page.

The glasses are expected to go on sale later this year for about the same price as a smartphone. Here comes the future!

YouTube Broadens Market with Video Rentals

A newly signed agreement struck a movie-rental deal between Google's YouTube and Paramount Pictures. Paramount added 500 films to YouTube's online video store, bringing their total rental catalog to 9,000.

Including Paramount Pictures, five of the six major film studios, along with ten independent studios, have now agreed to rent films through YouTube and Google Play. While 20th Century Fox is now the only major studio holdout, many have found it surprising that Paramount joined Youtube's venture, given the fact that their parent companies are in a feud over a $1 billion lawsuit.

This new deal with Paramount reflects YouTube's recent strategy to expand its services beyond its trademark user-created videos. They want to provide their millions of online viewers with a range of entertainment options.

"Paramount Pictures is one of the biggest movies studios on the planet," said Malik Ducard, director of content partnerships at YouTube. "We're thrilled to bring nearly 500 of their films to movie fans in the U.S. and Canada on YouTube and Google Play."

The Paramount films will be available on YouTube Rentals and Google Play for $2 to $4 per viewing. Online movies and pay-per-view options have created even more competition between Google, iTunes, Amazon, and Netflix.

YouTube's breakthrough into the movie rental industry is just another example of a company continuing to innovate itself in order to stay relevant with consumers. While YouTube never lost popularity among its users, the company recognized another opportunity to broaden their brand and gain more profits.

Google's Self-Driving Car is Tested by Blind Man

In 2010, Google announced it's self-driving car project. The company has been working on building cars that rely on laser range finders, radar sensors, and video cameras to navigate the road ahead in order to make driving safe, more efficient, and more accessible.  While Google hasn't said yet what they plan on doing with the cars, it should be a good business for them because the cars rely heavily on Google's data centers.

The steering wheel turns automatically, and the vehicle stops for red lights and stop signs. Radar and lasers check for cross-traffic and prevent the vehicle from collisions.

Steve Mahan, a man who only has 95 percent of his vision, recently took the car for a test drive. A Google employee sat next to him with a computer, programming the route to each destination.

"Where this would change my life is to give me the independence and the flexibility to go the places I both want to go and need to go," Mahan said.

Mahan isn't the only person who's life would be drastically affected by the introduction of this self-driving car. Many people who have medical conditions that have kept them off the road in the past will be able to use cars as a means of transportation again.

"There are a lot of hoops that are going to need to be jumped through in the years to come: Things like driver's licenses and regulatory stuff to allow these vehicles to traverse roadways. But the technology is absolutely intriguing," said Eric Bridges, government affairs director for the American Council of the Blind.

I look forward to seeing what this invention will bring in the future. Many other companies, including Lexus and BMW, are working toward building a robotic car as well.

Some Employers Cross the Line During Recruitment

A recent debate was brought up when a New York statistician was asked by a job interviewer for his Facebook username and password. Although he withdrew his application on the grounds that he didn't want to work for a company that would ask such information, this was not an isolated incident. It is becoming more and more common for companies to ask potential employees for their private Facebook information.

While the use of social media is not new to the recruitment process, asking for Facebook passwords is taking it a step too far in many people's opinions.

"I have heard about recruiters and hiring managers performing searchers on social media channels when vetting out candidates, but directly asking for a password is akin to asking for the password to an employee's email account or other password-protected material," said Jake Wengroff, global director, social media strategy and research, Frost & Sullivan. "It is a clear invasion of privacy."

A recent poll conducted by CBC asked readers if they would hand over their Facebook login information to a potential employer. More than 82 percent of the respondents said "No, it's an invasion of my privacy."

I agree with the opinion that employees deserve a certain amount of privacy, and asking for a password to a person's personal life is crossing an obvious line. However, in this economy, many people cannot afford to stand up for their rights and give up the opportunity for a job. I think that in the near future, enough cases will be filed, and asking for a Facebook password as part of a job interview will be deemed illegal.

Starbucks' New Acquisition Looks Promising

Starbucks recently announced the opening of its first Evolution Fresh juice store in Bellevue, Washington. Evolution Fresh had been selling its juices in grocery stores, such as Whole Foods, before being purchased by Starbucks in November for $30 million.

The new store offers premium juices made from fresh, natural ingredients as well as other food items like wraps, salads, soups, and vegetarian and vegan options. Evolution Fresh is one of the few juice companies that still cracks, peels, presses and squeezes its own fruits and vegetables rather than using pureed or powdered ingredients.

Starbucks' acquisition of Evolution Fresh is part of an attempt to broaden its business as consumers' demand for healthier products increase. The company has introduced lower-calorie and lower-fat food options, sugar-free syrups, and switched from whole milk to 2 percent milk as the default in its drinks.

While the new store offers much healthier options, consumers will be paying for this service. An eight-ounce drink will cost $4.99 and a 16-ounce drink will cost $7.99. While eight dollars for a glass of juice sounds pricey, they hope to reach Starbucks' current clientele by offering high-quality beverages at a premium price.

Based on Starbucks' history of success, I think that their acquisition of Evolution Fresh was a smart decision from a business standpoint. They have already conquered the coffee industry, and by expanding their services into a similar industry that targets different consumers, they will experience even more success.

Facebook Gives Companies a New Way of Advertising

Last week, Facebook launched Timeline for Brands, which allows companies to make facebook pages with the same look and feel as regular users.

Every brand's Facebook page will automatically switch to Timeline by the end of the month. However, most brands are making the switch themselves, as they see this as becoming a successful new tool to reach consumers.

"It allows us to tell our brand history in a highly visual and organized timeline. Whether you're a fan since the brand's launch or a new fan who wants to learn about Lexus - you can see what we've been doing," said Kat Kirsch of Lexus. "We can showcase all major vehicle launches, redesigns and concept cars."

Timeline for individual profiles was designed so that users could easily tell their stories and create their identities online, and this concept carries over to Timeline for Brands.

The Timeline layout allows companies to expand or hide specific posts as well as respond directly to private messages. The layout is also more engaging and social for individual users, allowing them to see how many friends "like" the brand, as well as friends' public mentions of related topics.

The Facebook IPO filing put pressure on the social media website to find new ways to grab the attention of investors. Because websites like this tend to have a short life (look at MySpace, for example), the creators must constantly make updates to keep it relevant for users, advertisers, and investors. So far, Facebook has been successful in differentiating itself, and Timeline for Brands was just the next step. 

Project Phenix is the New Buzz in Hollywood

After Blockbuster was phased out by new technology, online companies such as Netflix and Hulu dominated the movie industry. However, two of Hollywood's biggest production companies have introduced a new way to enjoy movies.

Warner Bros. Home Entertainment and Twentieth Century Fox Home Entertainment recently teamed up with SanDisk and Western Digital to create "Project Phenix". This service allows consumers to back up movies onto portable storage devices, such as SD cards and hard drives, and then use them on laptops, tablets, and mobile phones.

The companies behind Phenix intend to make the system simple, easy to use, and stored in a local but portable format.

"[Project Phenix] will provide consumers with a digital solution for movies and TV shows that is as simple to use as DVD and Blu-ray discs," said Bert Hesselink, chief technical officer of Western Digital Branded Products, in a statement. "Digital library content can be easily viewed inside the home on a TV, PC or tablet, or when owners are on the move with a portable library copy, providing mobile viewing even when a reliable Internet connection is not available, such as a plane, car, train or remote location."

With the introduction of new technology, Hollywood has had to innovate the way consumers are able to watch movies. Companies such as Netflix and Hulu have utilized the popularity of the Internet in order to reach consumers, but there are still areas in which they can improve. Project Phenix hopes to simplify the system and make it easy for its users, which is the most important thing most consumers look for when they just want to watch a movie.

Is Text Messaging on the Verge of Extinction?

Recently, there has been buzz among social media websites and blogs regarding the status of text messaging. With new free social messaging apps, such as Blackberry Messenger and Facebook Mobile Messenger, simple text messaging could be completely eliminated in just three years.

Phone companies lost $13.9 billion last year because consumers chose to use SMS applications instead of traditional text messaging through their mobile phone plans. This makes sense considering the fact that a purchase of about $1 and a data connection is all you need to message all your friends for free. This is more appealing to consumers than paying for a text messaging plan that could be quite expensive, especially if you go over your data limit.

Although things aren't looking promising for big phone companies, traditional text messages are still used by 75 percent of the world's cellphone users. The appeal of simple text messaging is that it is connected to your phone number and it doesn't matter what sort of hardware or network you are using. For example, somebody on BBM can't speak to somebody on Kik, which causes separation among users.

While text messaging is still in the game for now, smart phones and their apps have opened up a whole range of new possibilities when it comes to communicating. Phone companies need to update text messaging as they update their phones. In order to keep their clients satisfied and compete with cheaper apps, the networks have to find innovative ways to make text messaging available to consumers.

MasterCard Turns Mobile Phones Into Payment Processors

I recently read an article that stated that about 85 percent of world retail transactions are still done with paper currency. This statistic shocked me because I thought that credit and debit cards had passed up cash as the number one form of payment.

MasterCard was aware of this statistic, and viewed it as an opportunity to research why digital payments weren't the norm, and to revolutionize a new way to reach the emerging target markets. They found that the main problem with digital payments is that most people do not have proper bank accounts. However, most people do have mobile phones. In fact, even the poorest countries have 50 to 60 percent penetration rates of mobile telephony.

"This means that most adults can have access to mobile phones," said Mung Ki Woo, group executive for mobile and emerging payments at MasterCard. "Out of this discrepancy was born mobile money services."

Today, MasterCard announced the MasterCard Mobile Money Partnership Program to turn mobile phones into payment processors. This program enables consumers to purchase goods and services through their mobile phones, as well as transfer funds and pay bills.

"By adding these services, we're providing mobile money users with greater flexibility for their payment decisions," said Woo. "Now a consumer in India can go to a general store that accepts MasterCard cards and can purchase goods without the use of physical currency, something that was never available to them before."

MasterCard made a smart move in the business world by identifying a neglected potential target market and finding a way to penetrate into this market by innovating a new program. I think that they will find this program to be successful and that several other companies will follow their lead. 

Pinterest's Popularity Does Not Waver

Last month, Facebook introduced social apps for the new "Timeline" layout. These apps aimed to enhance users' facebook pages with apps that help them tell more about themselves, like whether they enjoy cooking, eating, traveling, running, or reviewing movies. Facebook founder Mark Zuckerberg said, "We think that people are going to want to share all kinds of things with their lives and we think that apps are the way they want to show them."

As I mentioned in a previous blog, Pinterest has been quickly making a name for itself in the world of social media. Pinterest's integreation with Facebook has been no exception to this. In fact, in just one month, it has seen visits from Facebook users increase more than 60 percent.

Pinterest's growth on Facebook comes as no surprise, and further reiterates the fact that this is a social media revolution and it is here to stay. I'm eager to see what the future of Pinterest has in store for it's users. Like Facebook and other similar websites, the developers must constantly be updating the features to keep users entertained. We have all seen the different phases of Facebook, and I think Pinterest will keep things just as interesting.

California Takes a Step for Gay Rights

Courts in California made an important decision this week regarding the controversial Proposition 8. This constitutional amendment, passed in 2008, eliminated the right of same-sex couples to marry. Naturally, gay marriage became an even bigger issue with activists in California after this ballot passed.

However, a federal court ruling on Tuesday threw out the proposition. Although this is a victory in just one state for now, some activists are saying it could fuel the fight for same-sex marriages across the country. Statehouses in New Jersey, Maryland and Washington are already working on legislation that would allow same-sex couples to marry.

I think that this is a step in the right direction for our country. America bases itself on the premise of having equality for all, but taking rights away from a person based solely on their sexual preference contradicts that. Gay people don't ruin the sanctity of marriage, drunken Vegas weddings and Kim Kardashian's 72 day marriage do.

If we want to keep our country as the "land of the free", then we have to allow freedom and equality for every citizen, no matter what their skin color, religious beliefs, or sexual preference is. By striking down Proposition 8, California is heading in the right direction and I hope that other states follow in its lead.

Twitter Scores Touchdowns in the Social Media Game

This year, the Super Bowl was the most watched TV show in history, with 111.3 million viewers. However, the social network data makes you question how many of those viewers were actually watching for the football game.

According to a study done by Networked Insights, almost three-fourths of the conversations taking place on Twitter and Facebook on Sunday had nothing to do with the game itself. Forty-two percent of the tweets were about commercials, while 32 percent were about Madonna and the halftime show. Surprisingly, only two percent of the total tweets had to do with the Giants' victory.

Although the majority of the talk on Twitter and other similar websites was about celebrities, brands, and individual players, rather than the football game itself, the Super Bowl was still successful in attracting an incredible amount of publicity through social media.

Tweets including the hashtag #superbowl numbered around 1.6 million. This is the same amount of tweets as are normally posted in a single day. This drastic increase in Twitter activity led the social media outlet to experience two record-breaking moments during the game - once during the halftime performance and once at the end of the game. Furthermore, Twitter averaged an unbelievable 10,000 tweets per second during the game.

The amount of traffic Twitter received during the Super Bowl may directly relate to the way marketers reach out to consumers in the future. While Super Bowl commercials will always be influential in the advertising world, more companies may look to social media websites, such as Twitter, for a relatively cheap and effective way to reach their target markets. The statistics showing how huge the population of people using Twitter during the game sparked interest in a possible new way to advertise. It is predicted that five years from now, brands could spend up to $10 million on promoted tweets during the Super Bowl.

Komen's Decision to Stop Supporting Planned Parenthood

Susan G. Komen for the Cure, an important organization dedicated to breast cancer research, recently stopped its financial support of Planned Parenthood.

Planned Parenthood received $120,000 in annual grants from Komen, which made up half of its yearly budget for breast health care. Although the money received from the foundation was not used to fund abortions, many are speculating that Komen cut ties due to political pressure from pro-life activists.

Being pro-choice, I do not support Komen's decision to stop funding Planned Parenthood, and find it disappointing that an organization of such a high status would give into pressure and directly affect thousands of women nationwide as a result. I believe that it is worse for a woman to have a child that she doesn't want or cannot care for than to have an abortion. According to a report done by The Adoption and Foster Care Analysis and Reporting System, there are over 400,000 children in foster care today. If a woman has a baby for the sole reason that she has no other choice, that number will increase, as well as the number of children who are neglected, abused, and financially unstable.


Furthermore, the money Planned Parenthood received from the Komen Foundation was used strictly for breast health care, such as breast exams and mammogram referrals. Both organizations are dedicated to women's health, and it is disappointing that such a large and influential organization would put political pressure over what it truly stands for. As Sue Dunlap, chief executive of Planned Parenthood Los Angeles, said, "I think when women's health is more of a political conversation than a conversation about healthcare and taking care of people, then we've gone too far."

Pinterest's Effect on Consumer Spending

An article posted on ReadWriteWeb this week discussed Pinterest's influence on consumer purchases, especially compared to social media leader, Facebook.

Pinterest is a fairly new social media outlet that lets its users "organize all the beautiful things [they] find on the web", share it with their followers, and browse through other people's pinboards.

The direct effect this has on consumer spending is fairly obvious. By clicking on any picture that is "pinned", you are directed to the original website where you are able to purchase the product. Pinterest essentially enables its users to create a virtual wishlist of items and products they like.

Eighty percent of Pinterest's users are women ages 25-44. This demographic is becoming increasingly influential, especially in the economy. According to a statistic, women account for 85 percent of all consumer purchases. Because women are the main spending force in a household, websites like Pinterest enable their spending and make shopping from home even easier. 

Although Facebook has tried to break into the social commerce trend, they have not been nearly as successful as Pinterest. Facebook has already established itself as a solely social site, and that is all its users want and expect from the website. Anything else is considered clutter and is unappealing to users.

Consumers are not the only population who are directly affected by social commerce websites such as Pinterest. Retailers are finding that this is a cheap and effective way to reach their target market without putting in any effort. Nordstrom's social media manager Shauna Causey said, "We view [Pinterest] as another way to engage with customers rather than marketing. Images are a great way to share ideas and trends in the retail social media landscape." 

Although there is no way to tell yet if Pinterest is just a trend, I think the overall idea of social commerce through the Internet is here to stay. Technology has made everything easier and faster for the modern consumer. From sending a thank you letter to buying a car to browsing retail stores, consumers are turning to the Internet to make the errands in their life quicker and more efficient. By making these transactions easier on both the customer and the retailer, websites, such as Pinterest, are less of a trend and more of an online revolution.