IZEA Archive

Last week paid blog post network Izea went public with a stock on the OTC board. Jason Calacanis has his explanation of the transaction on the Launch blog calling the transaction a, “back door IPO”. Izea CEO Ted Murphy created a video to demonstrate why Izea is a good investment.

Today Izea has announced the acquisition of Berlin-based Magpie. The press release notes the transaction was a cash and stock transaction but no acquisition amount was noted. The release explains that the reason for the acquisition was to help Izea grow their base in Europe.

I haven’t heard from Magpie in what feels like years. I think Magpie was the first paid ad network to pay Twitter users to post content into their streams. Since their launch, a number of other paid tweet ad networks have launched. Customers of Magpie will be transitioned into the Izea SponsoredTweets product. It should be interesting to see what happens to paid tweets once Twitter launches their own paid in-stream advertising product later this year.

I don’t know about you but my first fear when I read that Twitter will no longer allow ads in content streams was what will happen to all the celebrities who earn their bank rolls using a variety of sponsored ad programs. The first person who came to mind was Kim Kardashian. If you don’t know who Kim is, she is the spokesperson for some diet pill company.

If you haven’t read the news about the new changes regarding the Twitter API, check out Zee’s post at NextWeb and a FAQ by Danny Sullivan.

The simple explanation is – if you use an application that posts content to your Twitter account, that application can’t post ads to your Twitter account.

But I am glad, for Kim’s sake, that there is an easy way to get around this! All she (and all other paid Twitter members) is to just post the ads directly. Apparently this isn’t an illegal usage of Twitter so long as you (or your paid representative, PR firm, intern, etc.) posts the advertisement and clicks the “Tweet” button with a human hand.

The CEO of SponsoredTweets parent company, Izea, Ted Murphy has posted an update with the details of how his SponsoredTweets service will work going forward. Ted notes that his members will need to post updates themselves instead of using his automated service. They will also be doing more investigation on their members to make sure they are of the highest quality.

In other Twitter news, Alex Wilhelm suggests that Twitter is now a real company because they have a business plan. I suggest that you need customer service to be a real company. With everyone “mad” at Twitter’s changes, I continue to point to all of my posts related to not building solely on another company – leveraging is fine.

Yesterday we took a look at two paid posts from British Airways run through the Izea SocialSpark program. One of the comments I made was around how the paid disclosure is referenced. Izea required that the paid post badge be added to the bottom of the post. My suggestion for clarity was to add a clear notice that the post is paid/sponsored at the top of the post.

Last night I received an email from Izea founder Ted Murphy that basically addressed my suggestion. It was perfect timing as Izea launched their updated disclosure requirements earlier in the day. You can read their disclosure update announcement on the Izea blog. They are calling the update a “sandwich disclosure”. You can see their sandwich image below. Basically they now require their network of paid bloggers to disclose at the top and bottom of each post that the content is sponsored/paid. I am glad to see this change – let’s hope they can enforce it.

My only suggestion is around how they handle the disclosure technically. The required content is a block of HTML. Why not switch it to a simple Javascript include so that it can be changed/adapted at a global level going forward. If a change needs to be made, it can be handled in one Javascript include rather than on each individual post. I can’t wait to see this change rolled out on the paid blogger’s blogs.

Izea notes that their system checks for the disclosure messages and rejects any posts that don’t include the required notations.

– I wonder which part of the sandwich is the real opinion part :)

I’ve flown on British Airways three times and all three flights went well. The last time on British Airways was in 2006 and was a short hop from Venice to London and I remember the crew making the trip smooth for someone who really doesn’t enjoy flying. So it was a shock to learn that an airline that has a good reputation is buying reviews and paid posts. I decided to take a look at two posts, one from former tech blogger Meghan Asha and the other from her NonSociety partner Jordan Reid.

You can read the posting on SocialSpark (that’s Izea’s posting service) where British Airlines outlines what they require to be included in the post. The paid post provides for $15 in earnings although I believe some Izea posters make more than what is listed.

It’s interesting that the posts from Jordan and Meghan basically follow the required script from British Airways exactly. Is that where the “real opinion” comes from? One requirement is that the post is more than 200 words; Meghan’s comes in below that at 186 words. Both bloggers provide a small button to note that the post is paid although it is at the bottom of the post. I know Izea founder Ted Murphy talks about the importance of disclosure is his network’s paid posts which is a good thing. One change I’d like to see is that the button is moved to the top and clear language is added to the top of every post noting that the post is paid. You may never even see the button on the two blogs because of the non-traditional layout that the NonSociety site employs.

Continue reading “Just What Did British Airways Buy?” »

Last week paid review service Izea launched a "social media" campaign for K-Mart which offered several high profile bloggers a $500 gift card to go on a free shopping spree as long as they wrote a review of their experience. The campaign also included a nice nugget of traffic for the bloggers because they were also to give away a $500 gift card to one of their readers. To enter the contest, you needed to spam Twitter with a message such as, "RT @eMom is giving away a $500 Kmart Gift Card on her blog – simply comment or tweet to enter: (url)". Immediately when I saw these posts, both on the participating blogs and the spam on Twitter, I asked to speak with Izea CEO Ted Murphy about the campaign.

I’ve always been interested in watching how Ted moves. Ted pushes the envelope as far as possible which can have positive and negative consequences. I enjoy discussions about moving the conversation forward. Ted has also been willing to go right after the valley elite bloggers (something most others will do in private but never in public). The conversation with Ted around the campaign was good and he was open to my feedback and thoughts. Understand that I’ve managed the online spend for some of the largest consumer brands in the world and to me this campaign came off as nothing more than paying for a few positive reviews. It also seems that more than one of the bloggers who received the $500 are on the Izea board of bloggers. My net take is that the money was given to the complete wrong set of bloggers for the campaign to have any real effectiveness for Kmart’s target market.

If the Kmart paid campaign had the bloggers go into the store and select items for disadvantaged kids, military families overseas, kids with diseases, kids with no parents, etc., I would have felt somewhat better about the campaign. Checking the amazingly positive reviews from the paid bloggers, I did notice that Chris Brogan purchased a few items for a charity and Shoemoney purchased a pack of underwear for a military family. It’s actually interesting that none of the paid bloggers thought of this.

Very Positive Store Reviews

Here’s an example of how overly positive the reviews were. Shoemoney said, "Amazing prices on media" – I went to Kmart and priced the media and their prices can’t even come close to most online retailers or even BestBuy. Chris Brogan notes that he saved over $200 on his purchases and that the huge savings were a shock to him. I guess Chris doesn’t do a lot of offline shopping because if he did, he’d know that all stores use this as a way to get you to believe you saved something when you really didn’t. I’d be happy to scan my grocery receipts to show you plenty of examples.

Pretty funny, Julia Roy went to one of the stores in NYC. I’d love to go back to the store with Julia to do a real video review. She says the store isn’t visually appealing. Frankly that’s the least of the issues in both NYC stores. You will note that unlike many of the other paid bloggers, she tightly crops her photos, has no photos inside the store and basically ignores the store itself, instead just pimps all the free goods she got! I’d love to know if one, just one, of her readers actually went to Kmart after reading her review.

The real question here is what did Kmart get out of the positive paid reviews? In my opinion they got nothing out of it. What I’d like to see are receipts from each of the paid bloggers for their Kmart purchases in January, March and August of 2009. Clearly they loved Kmart so much they will certainly go back, right? I am also really interested to see the presentation that Ted and his team will show Kmart. If we look back to 1995, "hits" were the big metric which was amazingly gamed. I am guessing that Ted will shoe a chart pointing to just how many mentions of "Kmart" were said on Twitter during the promotion period. Those numbers are absolutely meaningless. There were two options to enter: one was to go to Kmart.com and find the item you want to win and post it on one of the paid blogger posts. The other way was to post a message on Twitter pointing to the paid blogger posts. Chris even tells his readers basically not visit the Kmart site and just do the "simple" option of a Twitter message! I have asked Ted for his Kmart contact – would love to have a conversation with him/her about their takeaways.

If anyone won with this campaign, it certainly wasn’t Kmart.

Sears Paid Post Campaign

Let’s move ahead to the current campaign Izea is running with Kmart’s parent company Sears. It looks like Ted took my suggestion of having the bloggers shop for charities. This at least moves the campaign a bit further along the stick of reasonableness. Unfortunately, it does appear that some of the paid bloggers for Sears bought items for themselves. I guess the traffic boost wasn’t enough to satisfy. Here are a couple of examples: Techipedia and Chris Heuer. You’d think that Sears would want to push their brand new mobile ordering site to these early adopters and social media users.

This Sears campaign didn’t even ask readers of the paid bloggers to go to the Sears website, instead once again a comment or a twitter message was required to enter. I can’t believe someone at Sears corporate approved this. Seriously.

Risks to Brands

Move forward to this past weekend. I got a call from Forrester analyst Jeremiah Owyang at 7am on Saturday. He wanted to discuss my thoughts on the campaigns because apparently he advises his clients on whether they should be using this type of online media in their marketing budgets. It appeared that during the balance of Saturday and Sunday morning there was some bitchmeme between Jeremiah, Chris Brogan and Aaron Brazell. Aaron is one of the Sears paid bloggers and I guess wanted to defend himself before the campaign came out today. Frankly I don’t care about any of the fighting. The net result of the fighting were 3 main blog posts:

• Jeremiah Owyang
• Aaron Brazell
• Chris Brogan

I would say I know all three of these gentlemen about the same. Chris did help me get a small ad campaign last month and I’ve known Jeremiah the longest. So it pains me to say this but I basically disagree mostly with Jeremiah’s post and am disappointed with his "risks to brands" section. His post could read as the sales brochure for Izea. Jeremiah writes:

For brands, they should realize that this is not the only way to reach customers, many brands are reaching customers in social networks, building online communities, and using corporate blogs. Brands shouldn’t put all their resources into sponsored blog posts.

Think about all of the risks that a brand could be subject to, this was the best that a supposedly top ranking analyst could come up with? I know I am being harsh but his statement just came as a total shock to me from someone who I consider quite intelligent.

The real risk to brands is the damage they could face from having people spew amazingly positive comments about their products. The average mainstream blog reader doesn’t know the different between paid shill and unbiased, authentic reviews. Look at the damage that Walmart and Sony faced last year with their blogging efforts. I can provide many examples of brands being tarnished by making bad decisions. This is the real risk – what happens if it comes to light that one (or more) of the paid Kmart bloggers purposely wrote a very positive review in the hopes of getting more work and in fact their real review would have been much more critical? Or if that blogger accidentally mentions on Twitter that the post was fake? Sure that will probably be a negative for the blogger but it will be much more of a negative for the retailer. Kmart is already at the bottom of the food chain, can they afford a social media attack (see Motrin) on their brand? Brand damage is the biggest risk to a brand who gambles with paid blogging. There are other risks and at the end of the risk chain is the risk that Jeremiah mentions above.

Update: Jeremiah noted this evening about the balance that must be considered when running a paid review. "There are four stakeholders that must balance: Brands (buyers), Bloggers (inventory), community (ROI), and Izea (Broker)". I would generally agree with his statement.

Risks To Bloggers

The most popular risk I hear that bloggers face with regards to paid posts is that if they don’t tell the truth they will lose credibility and therefore their audience. Hogwash. To quote my buddy Gabe Rivera, "readers don’t care". In general readers stay no matter what happens if they like the writer, the content, or the community. The only thing that could affect the blogger is if they don’t note that the post is paid (i.e. transparency). This was apparently the issue with the "payperpost" company that predated Izea. As long as they provide disclosure, my comment above stands.

Final Thoughts on Paid Blogging

I am all for paid advertorials. This is where a company purchases a post on a blog – the company can do with it as they wish. ReviewMe runs these type of campaigns I believe. Here’s an example of this type of advertorial on VentureBeat.

I am not a fan of paid reviews because as you can see with the Kmart campaign, it pushes bloggers to write positive reviews. My concern has always been that paid reviewers who write negative reviews won’t get future work so the tendancy is to write more positively than would normally be exercised. As a former public auditor, it’s just not a pill I am willing to swallow. In fact, over the long-term, it will hurt blogging as a profession more than it will ever help. The short term wins for the mommy bloggers (they are the biggest group of paid reviewers) and other paid reviewers will be felt in the long term. Think of where we are now as the 2005 period for U.S. mortgages and you know what came next.

I’ve been offered so many campaigns on our sister site HTMLCenter over the past 12 years I can’t even count that high. I get offers daily to run all sorts of paid campaigns – most would never be visible to the average reader and would allow me to get ahead of my bills and get rid of my 20 year old tv that no longer shows the color blue. But I refuse every single time. And I won’t run paid reviews on my sites no matter how much a company offers. Everyone has to make their own decisions and by no means am I forcing my opinions onto other blogs.

I do think Ted will do very well as there are plenty of people who will be willing to take his campaigns and run for the endzone with them. What little I do know about Ted, he’s an excellent salesman (he could sell ice to an eskimo). I sure hope he is considering if he will leave the blogging industry better than when he found it when he cashes out.

Again, big eyes in the short-term will hurt the industry as a whole in the long-term. And with that, I conclude this way-too-long post. Next time we will take a look at what is a "social media" campaign. Thanks for reading.

Other posts over the past few days include: Duncan Riley, Stowe Boyd, and Lucretia Pruitt.

Izea, the maker of PayPerPost and SocialSpark has announced the launch of their “blogger advisory board” today. Izea CEO Ted Murphy explains, “The Advisors will be working together with our management team to guide the company in product development, outreach and further enhancement of our code of ethics.”

The group is paid with options, not direct cash. The group includes: Chris Brogan, Michael Brito, Brian Clark, Jim Kukral, Neil Patel, Wendy Piersall, Jeremy Schoemaker and Missy Ward.

The bloggers are responsible for disclosing when they post about Izea. Seems like your typical advisory role trade: stock/options for insight along with some linking from time-to-time. The group will meet at Izea’s HQ in December. I look forward to reading the minutes from the meeting.

While I am not a fan of paid reviews, I am all for paid advertorials on blogs. We are starting to see more advertorials popping up and my hope is that we see more going forward.

It’s interesting to see Neil Patel’s name on the list given his arrangement with Techcrunch. As many of you know, Techcrunch doesn’t like Izea.

This afternoon comment reputation service SezWho announced three new partnerships. We covered the news along with several other sites.

On the Entrecard side, JoeTech put together 10 reasons why the SezWho/Entrecard partnership is important for bloggers. In the Entrecard community, the SezWho service seems to be well received so far.

Frederic at ReadWriteWeb has a different perspective on the announcements. His article title suggests that SezWho is in desperation mode and signed these deals to try to catchup with Disqus. Frederic notes, "Overall, this is an interesting, yet somewhat desperate, move by SezWho. In terms of publicity, it has been in the shadow of similar ventures like Disqus and Intense Debate." and concludes by noting that Izea is deceptive, Creative Blogging is spammy and Entrecard is niche. I’d like to share my thoughts on his post.

Never once when I read the news did I think that these were moves that signal desperation. Distribution is key for a service like SezWho and while many tech bloggers hate Izea and CEO Ted Murphy, he has access to a large number of bloggers. That’s a smart business move because if any of the Izea bloggers take the SezWho service and subsequently leave Izea, they keep SezWho. And note that I am not a big fan of what Izea is doing either, but having been on the corporate marketing side for nearly 10 years, I get what they are offering. Using Izea as a middleman to get to their set of bloggers for distribution makes sense.

Frederic also notes that "SezWho is under a lot of stress from Disqus and Intense Debate…" I’d love to see concrete proof of why SezWho is under a lot of stress from Disqus? Both Disqus and Intense Debate are building strong products but because SezWho isn’t a valley darling, does that mean they are facing pressure and stress? In fact, I guess Intense Debate must also be under a lot of stress from Disqus as well since they aren’t written about or discussed as often.

We see over and over where one company in an category is a valley darling and gets constant hype (no matter their results) while another company continues to build a product without the hype.

The hypothetical question for Frederic is, if Disqus made the exact same deals today, would you have said that Disqus was in a desperate situation against JS-Kit, Intense Debate and SezWho?

I’d also like to add that I think it was a mistake for SezWho and FutureWorks (the PR agency) to go out with all three releases at one time. I’ve written about the news flow topic before but knowing that many Web tech bloggers find Izea’s services to run on the other side of the fine line, splitting Izea out into a seperate release would have made sense. This would have allowed Entrecard and Creative Blogging to not lose the spotlight over the Izea discussion.

Even more importantly, by splitting up these releases by a few weeks, this would help to keep SezWho top of mind. By sending out three at once, now we may run into a "cold" period for SezWho news. I am sure Brian and his team at FutureWorks have a plan but I wanted to share my thoughts for other startups that don’t have a PR firm. Space out your news and keep your brand top of mind.