WebProNews

Category: PublicRelationsPro

PublicRelationsPro

  • Woods With Vonn In Public For The First Time

    Tiger Woods and Lindsey Vonn made their couple debut last night at the Costume Institute Gala at the Met, grabbing headlines as they walked the red carpet together for the first time.

    Of course, the two made it official in March when they posted photos of themselves on Facebook to tell the world that they are, in fact, dating. But seeing them out together is a whole different media ballgame.

    Woods released a statement about the pairing on the social media site, saying, “This season has been great so far and I’m happy with my wins at Torrey and Doral. Something nice that’s happened off the course was meeting Lindsey Vonn,” the star athlete captioned the album—which features four perfectly posed pics of the happy couple—on his social media page. “Lindsey and I have been friends for some time, but over the last few months we have become very close and are now dating. We thank you for your support and for respecting our privacy. We want to continue our relationship, privately, as an ordinary couple and continue to compete as athletes.”

    The couple glowed on the red carpet last night, with Vonn wearing a cream-colored floor-length gown with sheer panels and Woods going for the traditional black-tie look.

    Image: Facebook

  • Facebook & GM Revive Advertising Relationship After Last Year’s Pre-IPO Breakup

    After a highly publicized split nearly a year ago, it looks like Facebook and General Motors are getting back together.

    GM has confirmed to Ad Age that they have decided to once again throw some advertising dollars into Facebook.

    “Chevrolet is testing a number of mobile-advertising solutions, including Facebook, as part of its ‘Find New Roads’ campaign,” said Chris Perry, VP Chevrolet marketing in the U.S. “Today, Chevrolet is launching an industry-first, ‘mobile-only’ pilot campaign for the Chevrolet Sonic that utilizes newly available targeting and measurement capabilities on Facebook.”

    Big news for GM, sure. But why is this big news for Facebook? Let’s take a brief walk through Facebook and GM’a relationship over the past year.

    In May of 2012, just days before Facebook’s IPO, GM announced that they would be pulling all of their Facebook ads. They stated that they simply weren’t convinced that Facebook ads were truly effective, and furthermore were unsure how they fit into their future marketing strategies. It was a high-profile move, at a time when Facebook’s ability to monetize was on everyone’s mind.

    Immediately, it felt like a pretty big slap to the face. A public vote of no confidence. A few days later, GM noted that they were making many big advertising decisions at the time. Basically, hey – no hard feelings. It’s all just part of a comprehensive retooling of the strategy. Of course, this did little to neutralize the sting, especially right around the IPO. Facebook’s stock price tanked, people started talking monetization issues, which led to talks about advertising strategies, which of course led to GM as the big example of a company who pulled the plug.

    A couple of months later, GM’s marketing head Joel Ewanick resigned – although it wasn’t really tied to the Facebook, specifically.

    Since then, multiple reports have suggested that Facebook and GM had reestablished talks. The most recent indicating that the two companies were “actively talking” about a return to a paid advertising partnership.

    “We’re still actively talking to them and looking at opportunities that come our way…I wouldn’t tell you that there’s a Mexican standoff here. We just didn’t see the value [in the ads],” said GM’s interim marketing head Alan Batey back in January.

    Ad Age says that part of the reason GM pulled out of Facebook in the first place involved the inability for the company to run bigger, “higher-impact” ads. Although that’s still not really possible, Facebook advertising has changed quite a bit in the last year – mainly with the launch of the real-time, cookie-based Facebook Exchange retargeting system.

    “We’ve had an ongoing dialogue with GM over the last 12 months and are pleased to have them back as an advertiser on Facebook. We look forward to working even more closely with GM in the coming weeks and months,” said a Facebook spokesperson.

    Any way you look at it, it’s a good thing for Facebook that GM has decided to try it again. There’s a chance that it could signify to other companies that it’s safe to open up their Facebook ad budgets a little bit. In the end, we’re not talking about a huge ad budget here that’s going to make or break either Facebook or GM. Before GM yanked their ads last May, it was reported that they had only been spending around $10 million on Facebook ads – hardly a game changer.

    [Image via Chevrolet.com]

  • Demand Media To Split Into Two Public Companies, Earnings Released

    Demand Media announced today that its board of directors has authorized a plan for the company to explore separating into two separate public companies – one for its media business and one for its domain business.

    CEO Richard Rosenblatt said, “Both businesses have grown to become leaders in their respective markets, and we now want to provide additional operational and strategic flexibility to drive sustainable growth. We believe a separation will position each business to better pursue its specific strategic priorities and vision, as well as improve transparency for investors and enable the capital markets to better assess each company’s value, performance and potential.”

    “We intend to appropriately capitalize both companies to pursue their distinct growth opportunities, such as the upcoming launch of new generic Top Level Domains that is a transformative event for our domain services business, as well as further diversifying our content offerings in our media business,” he added.

    Demand Media expects a potential transaction to come within the next nine to twelve months. In the meantime, the company will work with outside advisers to develop plans for the the board’s further consideration and approval.

    The company also just released its Q4 and Fiscal 2012 financial results.

    On the earnings call, Rosenblatt said the company intends to increase its investment in its people, its content production, and its gTLD initiative. On the content side of things, it will evolve its content production arm (Demand Studios), and expects to double its investment in content this year, further develop its algorithm, add additional quality improvements (like those that helped it achieve recovery from the Panda update), and expand production capabilities.

    The company will also increase distribution by expanding its partner network, which doubled revenues in 2012. Rosenblatt says he expects its revenues to double again this year.

    They’re also planning on launching eHow in two more countries this year (after launching in Germany in Q4).

    Rosenblatt says they’ll diversify into new content models, and will expand beyond their core ad-driven model with new paid opportunities including subscription video and elearning content.

    On the gTLD front, he noted that Amazon and Google were the biggest players, and that their participation will lead to a bigger market for everyone.

    Demand Media ranked as a top 20 US web property throughout last year, and was ranked at number 13 in January, according to comScore. The company reached over 125 million unique visitors worldwide in January, and eHow (which was once famously hit by Google’s Panda update) was ranked number 12 in the U.S. with 62 million unique visitors in January.

    “We finished the year on a high note, posting record fourth quarter results and completing our fifth consecutive year of record revenue and Adjusted EBITDA,” said Rosenblatt. “We improved content quality and diversified our distribution channels by successfully revamping our content platform in 2012, and are now prepared to significantly increase our content investments in 2013. In addition, we became a leader in the generic Top Level Domain opportunity, due to substantial investments we made in 2012. We plan to increase this investment ahead of the expected launch later this year.”

    “As a result of these two different growth opportunities, we also announced today that our Board of Directors has authorized a plan to explore the separation of our business into two independent publicly-traded companies via a tax-free spin-off,” he added. “If approved, the separation will facilitate better operational and strategic flexibility, enabling each business to focus on its distinct priorities and growth opportunities.”

    Here’s the earnings release in its entirety:

    SANTA MONICA, Calif.–(BUSINESS WIRE)–Feb. 19, 2013– Demand Media, Inc. (NYSE: DMD), a leading digital media and domain services company, today reported financial results for the fourth quarter and fiscal year ended December 31, 2012.

    “We finished the year on a high note, posting record fourth quarter results and completing our fifth consecutive year of record revenue and Adjusted EBITDA,” saidRichard Rosenblatt, Chairman and CEO of Demand Media. “We improved content quality and diversified our distribution channels by successfully revamping our content platform in 2012, and are now prepared to significantly increase our content investments in 2013. In addition, we became a leader in the generic Top Level Domain opportunity, due to substantial investments we made in 2012. We plan to increase this investment ahead of the expected launch later this year.”

    Rosenblatt added: “As a result of these two different growth opportunities, we also announced today that our Board of Directors has authorized a plan to explore the separation of our business into two independent publicly-traded companies via a tax-free spin-off. If approved, the separation will facilitate better operational and strategic flexibility, enabling each business to focus on its distinct priorities and growth opportunities.”

    Financial Summary
    In millions, except per share amounts
    Three months ended Year ended
    December 31, December 31,
    2011 2012 Change 2011 2012 Change
    Total Revenue $ 84.4 $ 103.1 22% $ 324.9 $ 380.6 17%
    Content & Media Revenue ex-TAC(1) $ 49.9 $ 62.3 25% $ 193.0 $ 227.0 18%
    Registrar Revenue 31.4 34.5 10% 119.4 134.2 12%
    Total Revenue ex-TAC(1) $ 81.3 $ 96.8 19% $ 312.4 $ 361.1 16%
    Income (loss) from Operations $ (4.8 ) $ 6.1 NA $ (13.1 ) $ 8.7 NA
    Adjusted EBITDA(1) $ 23.7 $ 29.4 24% $ 86.0 $ 103.4 20%
    Net income (loss) $ (6.4 ) $ 4.7 NA $ (18.5 ) $ 6.2 NA
    Adjusted net income(1) $ 6.8 $ 10.8 60% $ 21.9 $ 34.3 57%
    EPS – diluted $ (0.08 ) $ 0.05 NA $ (0.27 ) $ 0.07 NA
    Adjusted EPS(1) $ 0.08 $ 0.12 50% $ 0.25 $ 0.39 56%
    Cash Flow from Operations $ 27.2 $ 26.0 (4)% $ 85.3 $ 91.0 7%
    Free Cash Flow(1)(2) $ 18.3 $ 17.1 (7)% $ 19.5 $ 62.3 219%
     
    (1) These non-GAAP financial measures are described below and reconciled to their comparable GAAP measures in the accompanying tables. Effective Q1 2012, the Company began reporting Adjusted EBITDA instead of Adjusted OIBDA.
    Reconciliations for both measures are available on the investor relations section of the Company’s website.
    (2) In 2012, the Company invested $18.2 million in generic Top Level Domain (“gTLD”) applications, which did not impact its recurring Free Cash Flow metric.

    Q4 2012 Financial Summary:

    • Content & Media revenue ex-TAC grew 25% year-over-year, driven by 24% page view growth on the Company’s owned & operated properties as well as 37% growth in network RPMs ex-TAC, reflecting higher revenue from network content partners.
    • Registrar revenue grew 10% year-over-year, driven by an increase in the number of domains on our platform, due primarily to growth from new partners.
    • Adjusted EBITDA increased 24% year-over-year, resulting in 110 basis points of margin expansion to 30.3% of Revenue ex-TAC. This improvement was driven by the growth in higher margin Content & Media revenue and operating leverage.

    “In 2012 we generated over $60 million of free cash flow, which more than funded our acquisition of Name.com and the repurchase of nearly $9 million of our common stock,” said Demand Media’s CFO Mel Tang. “We plan to continue reinvesting our strong cash flows into long-term growth opportunities, such as our gTLD initiative as well as growing and diversifying our content offerings.”

    Business Highlights:

    • Demand Media ranked as a top 20 US web property throughout 2012, and ranked #13 in January 2013.(1)
    • Demand Media reached more than 125 million unique visitors worldwide in January 2013.(1)
    • eHow.com ranked as the #12 website in the US, with 62.0 million unique users inJanuary 2013.(1)
    • LIVESTRONG.COM/eHow Health ranked as the #3 Health property in the US inJanuary 2013.(1)
    • Cracked ranked as the #1 Humor property in the US in January 2013.(1)
    • On December 31, 2012, Demand Media acquired retail registrar Name.com, expanding its registrar platform as it prepares for the historic release of new gTLDs.
    • During the fourth quarter of 2012, Demand Media repurchased approximately 572,000 shares of common stock for $4.9 million under its Board-authorized $50.0 million share repurchase program. To date, the Company has repurchased approximately 4.0 million shares of common stock for $30.8 million.
    • On February 19, 2013, the Company announced that its Board of Directors has authorized a plan to explore the separation of its business into two distinct publicly traded companies.

    (1) Source: comScore.

    Operating Metrics:
    Three months ended Year ended
    December 31, December 31,
    % %
    2011 2012 Change 2011 2012 Change
    Content & Media Metrics:
    Owned and operated
    Page views(1) (in millions) 2,696 3,354 24 % 10,378 13,192 27 %
    RPM(2) $ 14.53 $ 14.55 — $ 15.14 $ 13.53 (11 )%
    Network of customer websites
    Page views(1)(in millions) 4,935 4,530 (8 )% 17,436 18,989 9 %
    RPM(2) $ 2.81 $ 4.38 56 % $ 2.77 $ 3.58 29 %
    RPM ex-TAC(3) $ 2.18 $ 2.98 37 % $ 2.06 $ 2.55 24 %
    Registrar Metrics:
    End of Period # of Domains(4) (in millions) 12.7 13.7 8 % 12.7 13.7 8 %
    Average Revenue per Domain(5) $ 10.08 $ 10.09 — $ 10.08 $ 10.19 1 %
    ____________________
    (1) Page views represent the total number of web pages viewed across (a) our owned and operated websites and/or (b) our network of customer websites, to the extent that the viewed customer web pages host the Company’s monetization, social media and/or content services.
    (2) RPM is defined as Content & Media revenue per one thousand page views.
    (3) RPM ex-TAC is defined as Content & Media Revenue ex-TAC per one thousand page views.
    (4) Domain is defined as an individual domain name paid for by a third-party customer where the domain name is managed through our Registrar service offering.
    (5) Average revenue per domain is calculated by dividing Registrar revenue for a period by the average number of domains registered in that period. Average revenue per domain for partial year periods is annualized.
    Beginning July 1, 2011, the number of net new domains has been adjusted to include only new registered domains added to our platform for which the Company has recognized revenue. Excluding the impact of this change, average revenue per domain during the three months and year ended December 31, 2012 would have increased 1% and decreased 4%, respectively, compared to the corresponding prior-year periods.

    Q4 2012 Operating Metrics:

    • Owned & Operated page views increased 24% year-over-year, driven primarily by strong traffic growth on eHow.com and LIVESTRONG.COM. Owned & Operated RPMs were relatively flat year-over-year.
    • Network page views decreased 8% year-over-year to 4.5 billion, due primarily to lower traffic from our social media partners. Network RPM ex-TAC increased 37% year-over-year, reflecting higher revenue from our growing network of content partners, primarily YouTube.
    • End of period domains increased 8% year-over-year to 13.7 million, driven primarily by the addition of higher volume customers and continued growth from existing resellers, with average revenue per domain flat year-over-year.

    Business Outlook

    The following forward-looking information includes certain projections made by management as of the date of this press release. The Company does not intend to revise or update this information, except as required by law, and may not provide this type of information in the future. Due to a variety of factors, actual results may differ significantly from those projected. The factors that may affect results include, without limitation, the factors referenced later in this announcement under the caption “Cautionary Information Regarding Forward-Looking Statements.” These and other factors are discussed in more detail in the Company’s filings with the Securities and Exchange Commission.

    Excluding $5 to $10 million of estimated expenses in 2013 associated with the formation of the Company’s gTLD initiative, the Company’s guidance for the first quarter endingMarch 31, 2013 and fiscal year ending December 31, 2013 is as follows:

    First Quarter 2013

    • Revenue in the range of $100.0 – $102.0 million
    • Revenue ex-TAC in the range of $94.0 – $96.0 million
    • Adjusted EBITDA in the range of $23.5 – $25.5 million
    • Adjusted EPS in the range of $0.07 – $0.08 per share
    • Weighted average diluted shares 89.0 – 90.0 million

    Full Year 2013

    • Revenue in the range of $435.0 – $443.0 million
    • Revenue ex-TAC in the range of $410.0 – $418.0 million
    • Adjusted EBITDA in the range of $110.0 – $115.0 million
    • Adjusted EPS in the range of $0.39 – $0.43 per share
    • Weighted average diluted shares 89.0 – 91.0 million

    Conference Call and Webcast Information

    Demand Media will host a corresponding conference call and live webcast at 5:00 p.m. Eastern time today. To access the conference call, dial 877.565.1268 (for domestic participants) or 937.999.3108 (for international participants). The conference ID is 90583374. To participate on the live call, analysts should dial-in at least 10 minutes prior to the commencement of the call. A live webcast also will be available on the Investor Relations section of the Company’s corporate website at http://ir.demandmedia.com and via replay beginning approximately two hours after the completion of the call.

    About Non-GAAP Financial Measures

    To supplement our consolidated financial statements, which are prepared and presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”), we use certain non-GAAP financial measures described below. The presentation of this additional financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures, please see the tables captioned “Reconciliation of Non-GAAP Measures to Unaudited Consolidated Statements of Operations” included at the end of this release.

    Effective Q1 2012, the Company began reporting Adjusted EBITDA instead of Adjusted OIBDA. While the dollar value of each measure is the same, a comparison of the historical reconciliation of both measures is provided in our supplemental financial schedules posted on the investor relations section of our corporate website athttp://ir.demandmedia.com. The non-GAAP financial measures presented in this release are the primary measures used by the Company’s management and board of directors to understand and evaluate its financial performance and operating trends, including period to period comparisons, to prepare and approve its annual budget and to develop short and long term operational plans. Additionally, Adjusted EBITDA is the primary measure used by the compensation committee of the Company’s board of directors to establish the funding targets for and fund its annual bonus pool for the Company’s employees and executives. We believe our presented non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) management frequently uses them in its discussions with investors, commercial bankers, securities analysts and other users of its financial statements.

    Revenue ex-TAC is defined by the Company as GAAP revenue less traffic acquisition costs (TAC). TAC comprises the portion of Content & Media GAAP revenue shared with the Company’s network customers. Management believes that Revenue ex-TAC is a meaningful measure of operating performance because it is frequently used for internal managerial purposes and helps facilitate a more complete period-to-period understanding of factors and trends affecting the Company’s underlying revenue performance of its Content & Media service offering.

    Adjusted earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA) is defined by the Company as net income (loss) before income tax expense, other income (expense), interest expense (income), depreciation, amortization, stock-based compensation, as well as the financial impact of acquisition and realignment costs, the formation expenses directly related to its gTLD initiative, expenditures related to the separation of Demand Media into two distinct publicly traded companies, and any gains or losses on certain asset sales or dispositions. Acquisition and realignment costs include such items, when applicable, as (1) non-cash GAAP purchase accounting adjustments for certain deferred revenue and costs, (2) legal, accounting and other professional fees directly attributable to acquisition activity, and (3) employee severance payments attributable to acquisition or corporate realignment activities. Management does not consider these expenses to be indicative of the Company’s ongoing operating results or future outlook.

    Management believes that these non-GAAP financial measures reflect the Company’s business in a manner that allows for meaningful period to period comparisons and analysis of trends. In particular, the exclusion of certain expenses in calculating Adjusted EBITDA can provide a useful measure for period to period comparisons of the Company’s underlying recurring revenue and operating costs, which is focused more closely on the current costs necessary to utilize previously acquired long-lived assets. In addition, management believes that it can be useful to exclude certain non-cash charges because the amount of such expenses is the result of long-term investment decisions in previous periods rather than day-to-day operating decisions. For example, due to the long-lived nature of a majority of its media content, the revenue generated by the Company’s media content assets in a given period bears little relationship to the amount of its investment in media content in that same period. Accordingly, management believes that content acquisition costs represent a discretionary long-term capital investment decision undertaken at a point in time. This investment decision is clearly distinguishable from other ongoing business activities, and its discretionary nature and long-term impact differentiate it from specific period transactions, decisions regarding day-to-day operations, and activities that would have an immediate impact on operating or financial performance if materially changed, deferred or terminated.

    Adjusted Earnings Per Share is defined by the Company as Adjusted Net Income divided by the weighted average number of shares outstanding. Adjusted Net Income is defined by the Company as net income (loss) before the effect of stock-based compensation, amortization of intangible assets acquired via business combinations, accelerated amortization of intangible assets removed from service, acquisition and realignment costs, the formation expenses directly related to its gTLD initiative, expenditures related to the separation of Demand Media into two distinct publicly traded companies, and any gains or losses on certain asset sales or dispositions, and is calculated using the application of a normalized effective tax rate. Acquisition and realignment costs include such items, when applicable, as (1) non-cash GAAP purchase accounting adjustments for certain deferred revenue and costs, (2) legal, accounting and other professional fees directly attributable to acquisition activity, and (3) employee severance payments attributable to acquisition or corporate realignment activities. Management does not consider these expenses to be indicative of the Company’s ongoing operating results or future outlook.

    Management believes that Adjusted Net Income and Adjusted Earnings Per Share provide investors with additional useful information to measure the Company’s underlying financial performance, particularly from period to period, because these measures are exclusive of certain non-cash expenses not directly related to the operation of its ongoing business (such as amortization of intangible assets acquired via business combinations, as well as certain other non-cash expenses such as purchase accounting adjustments and stock-based compensation) and include a normalized effective tax rate based on the Company’s statutory tax rate.

    Discretionary Free Cash Flow is defined by the Company as net cash provided by operating activities excluding cash outflows from acquisition and realignment activities, the formation expenses directly related to its gTLD initiative, and expenditures related to the separation of Demand Media into two distinct publicly traded companies, less capital expenditures to acquire property and equipment. Free Cash Flow is defined by the Company as Discretionary Free Cash Flow less investments in intangible assets and is not impacted by gTLD application payments, which were $18.2 million in 2012. Management believes that Discretionary Free Cash Flow and Free Cash Flow provide investors with additional useful information to measure operating liquidity because they reflect the Company’s underlying cash flows from recurring operating activities after investing in capital assets and intangible assets. These measures are used by management, and may also be useful for investors, to assess the Company’s ability to generate cash flow for a variety of strategic opportunities, including reinvestment in the business, pursuing new business opportunities, potential acquisitions, payment of dividends and share repurchases.

    The use of these non-GAAP financial measures has certain limitations because they do not reflect all items of income and expense, or cash flows that affect the Company’s operations. An additional limitation of these non-GAAP financial measures is that they do not have standardized meanings, and therefore other companies may use the same or similarly named measures but exclude different items or use different computations. Management compensates for these limitations by reconciling these non-GAAP financial measures to their most comparable GAAP financial measures within its financial press releases. Non-GAAP financial measures should be considered in addition to, not as a substitute for, financial measures prepared in accordance with GAAP. Further, these non-GAAP financial measures may differ from the non-GAAP financial information used by other companies, including peer companies, and therefore comparability may be limited. We encourage investors and others to review our financial information in its entirety and not rely on a single financial measure. The accompanying tables have more details on the GAAP financial measures and the related reconciliations.

    About Demand Media

    Demand Media, Inc. (NYSE: DMD) is a leading digital media and domain services company that informs and entertains one of the internet’s largest audiences, helps advertisers find innovative ways to engage with their customers and enables publishers, individuals and businesses to expand their online presence. Headquartered in Santa Monica, CA, Demand Media has offices in North America, South America and Europe. For more information about Demand Media, please visit www.demandmedia.com.

    Cautionary Information Regarding Forward-Looking Statements

    This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. These forward-looking statements involve risks and uncertainties regarding the Company’s future financial performance, and are based on current expectations, estimates and projections about our industry, financial condition, operating performance and results of operations, including certain assumptions related thereto. Statements containing words such as guidance, may, believe, anticipate, expect, intend, plan, project, projections, business outlook, and estimate or similar expressions constitute forward-looking statements. Actual results may differ materially from the results predicted, and reported results should not be considered an indication of future performance. Potential risks and uncertainties include, among others: our ability to complete a separation of our business as announced herein and unanticipated developments that may delay or negatively impact such a transaction; the possibility that we may decide not to proceed with the separation of our business as announced herein if we determine that alternative opportunities are more favorable to our stockholders; the possibility that we decide to separate our business in a manner different from that disclosed herein; the impact and possible disruption to our operations from pursuing such a separation transaction announced herein; our ability to retain key personnel; the high costs we will likely incur in connection with such a transaction, which we would not be able to recoup if such a transaction is not consummated; the expectation that the transaction announced herein will be tax-free; revenue and growth expectations for the two independent companies following the separation of our business; the ability of each business to operate as an independent entity upon completion of such a transaction; changes in the methodologies of internet search engines, including ongoing algorithmic changes made by Google as well as possible future changes, and the impact such changes may have on page view growth and driving search related traffic to our owned and operated websites and the websites of our network customers; changes in our content creation and distribution platform, including the possible repurposing of content to alternate distribution channels, reduced investments in intangible assets or the sale or removal of content; our ability to successfully launch, produce and monetize new content formats; the inherent challenges of estimating the overall impact on page views and search driven traffic to our owned and operated websites based on the data available to us as internet search engines continue to make adjustments to their search algorithms; our ability to compete with new or existing competitors; our ability to maintain or increase our advertising revenue; our ability to continue to drive and grow traffic to our owned and operated websites and the websites of our network customers; our ability to effectively monetize our portfolio of content; our dependence on material agreements with a specific business partner for a significant portion of our revenue; future internal rates of return on content investment and our decision to invest in different types of content in the future, including premium video and other formats of text content; our ability to attract and retain freelance creative professionals; changes in our level of investment in media content intangibles; the effects of changes or shifts in internet marketing expenditures, including from text to video content as well as from desktop to mobile content; the effects of shifting consumption of media content from desktop to mobile; the effects of seasonality on traffic to our owned and operated websites and the websites of our network customers; our ability to continue to add partners to our registrar platform on competitive terms; our ability to successfully pursue and implement our gTLD initiative; changes in stock-based compensation; changes in amortization or depreciation expense due to a variety of factors; potential write downs, reserves against or impairment of assets including receivables, goodwill, intangibles (including media content) or other assets; changes in tax laws, our business or other factors that would impact anticipated tax benefits or expenses; our ability to successfully identify, consummate and integrate acquisitions; our ability to retain key customers and key personnel; risks associated with litigation; the impact of governmental regulation; and the effects of discontinuing or discontinued business operations. From time to time, we may consider acquisitions or divestitures that, if consummated, could be material. Any forward-looking statements regarding financial metrics are based upon the assumption that no such acquisition or divestiture is consummated during the relevant periods. If an acquisition or divestiture were consummated, actual results could differ materially from any forward-looking statements. More information about potential risk factors that could affect our operating and financial results are contained in our annual report on Form 10-K for the fiscal year endingDecember 31, 2011 filed with the Securities and Exchange Commission(http://www.sec.gov) on February 24, 2012, and as such risk factors may be updated in our quarterly reports on Form 10-Q filed with the Securities and Exchange Commission, including, without limitation, information under the captions Risk Factors and Management’s Discussion and Analysis of Financial Condition and Results of Operations.

    Furthermore, as discussed above, the Company does not intend to revise or update the information set forth in this press release, except as required by law, and may not provide this type of information in the future.

    Demand Media, Inc. and Subsidiaries
    Unaudited Condensed Consolidated Statements of Operations
    (In thousands, except per share amounts)
    Three months ended Year ended
    December 31, December 31,
    2011 2012 2011 2012
    Revenue $ 84,415 $ 103,142 $ 324,866 $ 380,578
    Operating expenses
    Service costs (exclusive of amortization of intangible assets shown separately below) (1) (2) 40,198 48,865 155,830 181,018
    Sales and marketing (1) (2) 9,325 12,823 37,394 46,501
    Product development (1) (2) 9,462 9,719 38,146 40,708
    General and administrative (1) (2) 13,803 16,171 59,451 63,025
    Amortization of intangible assets 16,393 9,460 47,174 40,676
    Total operating expenses 89,181 97,038 337,995 371,928
    Income (loss) from operations (4,766 ) 6,104 (13,129 ) 8,650
    Other income (expense)
    Interest income 4 8 56 42
    Interest expense (151 ) (157 ) (861 ) (622 )
    Other income (expense), net (75 ) (34 ) (413 ) (111 )
    Total other expense (222 ) (183 ) (1,218 ) (691 )
    Income (loss) before income taxes (4,988 ) 5,921 (14,347 ) 7,959
    Income tax expense (1,438 ) (1,172 ) (4,177 ) (1,783 )
    Net (loss) income $ (6,426 ) $ 4,749 $ (18,524 ) $ 6,176
     
    (1) Stock-based compensation expense included in the line items above:
    Service costs $ 711 $ 679 $ 2,052 $ 2,820
    Sales and marketing 1,416 1,597 4,857 6,118
    Product development 1,364 1,283 5,013 6,452
    General and administrative 3,263 3,823 16,934 15,978
    Total stock-based compensation expense $ 6,754 $ 7,382 $ 28,856 $ 31,368
    (2) Depreciation included in the line items above:
    Service costs $ 3,770 $ 3,663 $ 16,075 $ 14,452
    Sales and marketing 127 108 423 453
    Product development 308 238 1,466 1,025
    General and administrative 861 1,025 2,994 3,728
    Total depreciation $ 5,066 $ 5,034 $ 20,958 $ 19,658
    Income (loss) per common share:
    Net income (loss) $ (6,426 ) $ 4,749 $ (18,524 ) $ 6,176
    Cumulative preferred stock dividends (3) — — (2,477 ) —
    Net income (loss) attributable to common stockholders $ (6,426 ) $ 4,749 $ (21,001 ) $ 6,176
    Net income (loss) per share – basic (0.08 ) 0.06 (0.27 ) 0.07
    Net income (loss) per share – diluted (0.08 ) 0.05 (0.27 ) 0.07
    Weighted average number of shares – basic 83,592 86,140 78,646 84,553
    Weighted average number of shares – diluted 83,592 88,444 78,646 87,237
    ____________________
    (3) As a result of the Company’s initial public offering which was completed on January 31, 2011, all shares of the Company’s preferred stock were converted to common stock.
    Demand Media, Inc. and Subsidiaries
    Unaudited Condensed Consolidated Balance Sheets
    (In thousands)
    December 31, December 31,
    2011 2012
    Current assets
    Cash and cash equivalents $ 86,035 $ 102,933
    Accounts receivable, net 32,665 45,517
    Prepaid expenses and other current assets 8,656 6,041
    Deferred registration costs 50,636 57,718
    Total current assets 177,992 212,209
    Property and equipment, net 32,626 35,467
    Intangible assets, net 111,304 91,061
    Goodwill 256,060 267,034
    Deferred registration costs 9,555 11,320
    Other long-term assets 2,566 20,906
    Total assets $ 590,103 $ 637,997
    Liabilities, Convertible Preferred Stock and Stockholders’ Equity (Deficit)
    Current liabilities
    Accounts payable $ 10,046 $ 10,471
    Accrued expenses and other current liabilities 33,932 40,489
    Deferred tax liabilities 18,288 18,892
    Deferred revenue 71,109 75,142
    Total current liabilities 133,375 144,994
    Deferred revenue 14,802 15,965
    Other liabilities 1,660 4,847
    Total liabilities 149,837 165,806
    Stockholders’ equity (deficit)
    Common stock and additional paid-in capital 528,042 562,703
    Treasury stock (17,064 ) (25,932 )
    Accumulated other comprehensive income 59 15
    Accumulated deficit (70,771 ) (64,595 )
    Total stockholders’ equity (deficit) 440,266 472,191
    Total liabilities, convertible preferred stock and stockholders’ equity (deficit) $ 590,103 $ 637,997
    Demand Media, Inc. and Subsidiaries
    Unaudited Condensed Consolidated Statements of Cash Flows
    (In thousands)
    Three months ended Year ended
    December 31, December 31,
    2011 2012 2011 2012
    Cash flows from operating activities:
    Net income (loss) $ (6,426 ) $ 4,749 $ (18,524 ) $ 6,176
    Adjustments to reconcile net loss to net cash provided by operating activities:
    Depreciation and amortization 21,459 14,494 68,132 60,334
    Stock-based compensation 6,741 7,382 28,730 31,368
    Other 1,128 1,134 3,491 1,717
    Net change in operating assets and liabilities, net of effect of acquisitions 4,322 (1,722 ) 3,520 (8,612 )
    Net cash provided by operating activities 27,224 26,037 85,349 90,983
    Cash flows from investing activities:
    Purchases of property and equipment (4,222 ) (5,283 ) (18,246 ) (17,708 )
    Purchases of intangibles (5,294 ) (4,647 ) (49,283 ) (13,237 )
    Payments for gTLD applications — — — (18,202 )
    Cash paid for acquisitions (38 ) (16,200 ) (31,010 ) (17,480 )
    Other — — — (855 )
    Net cash used in investing activities (9,554 ) (26,130 ) (98,539 ) (67,482 )
    Cash flows from financing activities:
    Proceeds from issuance of common stock, net (145 ) — 78,480 —
    Repurchases of common stock (13,336 ) (4,913 ) (17,064 ) (8,869 )
    Proceeds from exercises of stock options and contributions to ESPP 3,242 1,451 7,599 12,467
    Net taxes paid on RSUs vesting and options exercised (364 ) (6,151 ) (725 ) (9,496 )
    Other (168 ) (258 ) (1,354 ) (668 )
    Net cash provided by (used in) financing activities (10,771 ) (9,871 ) 66,936 (6,566 )
    Effect of foreign currency on cash and cash equivalents (18 ) (19 ) (49 ) (37 )
    Change in cash and cash equivalents 6,881 (9,983 ) 53,697 16,898
    Cash and cash equivalents, beginning of period 79,154 112,916 32,338 86,035
    Cash and cash equivalents, end of period $ 86,035 $ 102,933 $ 86,035 $ 102,933
    Demand Media, Inc. and Subsidiaries
    Reconciliations of Non-GAAP Measures to Unaudited Consolidated Statements of Operations
    (In thousands, except per share amounts)
    Three months ended Year ended
    December 31, December 31,
    2011 2012 2011 2012
    Revenue ex-TAC:
    Content & Media revenue $ 53,032 $ 68,633 $ 205,450 $ 246,399
    Less: traffic acquisition costs (TAC) (3,111 ) (6,332 ) (12,495 ) (19,441 )
    Content & Media Revenue ex-TAC 49,921 62,301 192,955 226,958
    Registrar revenue 31,383 34,509 119,416 134,179
    Total Revenue ex-TAC $ 81,304 $ 96,810 $ 312,371 $ 361,137
    Adjusted EBITDA(1):
    Net income (loss) $ (6,426 ) $ 4,749 $ (18,524 ) $ 6,176
    Income tax expense 1,438 1,172 4,177 1,783
    Interest and other expense, net 222 183 1,218 691
    Depreciation and amortization(2) 21,459 14,494 68,132 60,334
    Stock-based compensation 6,754 7,382 28,856 31,368
    Acquisition and realignment costs(3) 271 314 2,099 446
    gTLD expense(4) — 1,061 — 2,650
    Adjusted EBITDA $ 23,718 $ 29,355 $ 85,958 $ 103,448
    Discretionary and Total Free Cash Flow:
    Net cash provided by operating activities $ 27,224 $ 26,037 $ 85,349 $ 90,983
    Purchases of property and equipment (4,222 ) (5,283 ) (18,246 ) (17,708 )
    Acquisition and realignment cash flows 602 25 1,670 25
    gTLD expense cash flows(4) — 974 — 2,198
    Discretionary Free Cash Flow 23,604 21,753 68,773 75,498
    Purchases of intangible assets (5,294 ) (4,647 ) (49,283 ) (13,237 )
    Free Cash Flow(4)(5) $ 18,310 $ 17,106 $ 19,490 $ 62,261
    Adjusted Net Income:
    GAAP net income (loss) $ (6,426 ) $ 4,749 $ (18,524 ) $ 6,176
    (a) Stock-based compensation 6,754 7,382 28,856 31,368
    (b) Amortization of intangible assets – M&A 2,974 2,572 12,773 10,904
    (c) Content intangible assets removed from service(2) 5,898 237 5,898 2,055
    (d) Acquisition and realignment costs(3) 271 314 2,099 446
    (e) gTLD expense(4) — 1,061 — 2,650
    (f) Income tax effect of items (a) – (e) & application of 38% statutory tax rate to pre-tax income (2,707 ) (5,473 ) (9,229 ) (19,262 )
    Adjusted Net Income $ 6,764 $ 10,842 $ 21,873 $ 34,337
    Non-GAAP Adjusted Net Income per share – diluted $ 0.08 $ 0.12 $ 0.25 $ 0.39
    Shares used to calculate non-GAAP Adjusted Net Income per share – diluted(6) 86,758 88,444 88,541 87,237
    ___________________
    (1) Effective Q1 2012, the Company began reporting Adjusted EBITDA instead of Adjusted OIBDA. While the dollar value of each measure does not differ, a comparison of the historical reconciliation of both measures is provided in our supplemental financial schedules available on the investor relations section of our corporate website.
    (2) In conjunction with its previously announced plans to improve its content creation and distribution platform, the Company elected to remove certain content assets from service, resulting in accelerated amortization expense of $5.9 million in the fourth quarter of 2011, and $1.8 million and $0.2 million in the first and fourth quarter of 2012, respectively.
    (3) Acquisition and realignment costs include such items, when applicable, as (1) non-cash GAAP purchase accounting adjustments for certain deferred revenue and costs, (2) legal, accounting and other professional fees directly attributable to acquisition activity, and (3) employee severance payments attributable to acquisition or corporate realignment activities. Management does not consider these costs to be indicative of the Company’s core operating results.
    (4) Comprises formation expenses directly related to the Company’s gTLD initiative that did not generate associated revenue in 2012.
    (5) In 2012, the Company invested $18.2 million in gTLD applications, which did not impact its recurring Free Cash Flow metric.
    (6) Shares used to calculate non-GAAP Adjusted Net Income per share – diluted include the weighted average common stock for the periods presented and all dilutive common stock equivalents at each period. Amounts have been adjusted in 2011 to reflect the revised capital structure following the Company’s initial public offering which was completed on January 31, 2011, whereby the Company issued 5,175 shares of common stock and converted certain warrants and all of its previously outstanding convertible preferred stock into 62,155 shares of common stock as if those transactions were consummated on January 1, 2011.
    Demand Media, Inc. and Subsidiaries
    Unaudited GAAP Revenue, by Revenue Source
    (In thousands)
    Three months ended Year ended
    December 31, December 31,
    2011 2012 2011 2012
    Content & Media:
    Owned and operated websites $ 39,172 $ 48,796 $ 157,089 $ 178,511
    Network of customer websites 13,860 19,837 48,361 67,888
    Total Revenue – Content & Media 53,032 68,633 205,450 246,399
    Registrar 31,383 34,509 119,416 134,179
    Total Revenue $ 84,415 $ 103,142 $ 324,866 $ 380,578
    Three months ended Year ended
    December 31, December 31,
    2011 2012 2011 2012
    Content & Media:
    Owned and operated websites 46 % 47 % 48 % 47 %
    Network of customer websites 16 % 19 % 15 % 18 %
    Total Revenue – Content & Media 63 % 67 % 63 % 65 %
    Registrar 37 % 33 % 37 % 35 %
    Total Revenue 100 % 100 % 100 % 100 %

     

    Source: Demand Media, Inc.

  • Kristen Stewart Embarrasses Robert Pattinson With Public Apology

    It was the news heard ’round the world earlier this week when Kristen Stewart–of “Twilight” fame–released a public apology for her indiscretions with older, married director Rupert Sanders, effectively admitting the stories were true and causing the Hollywood rumor mill to come to a grinding, shuddering halt.

    Her longtime boyfriend, Robert Pattinson, is reportedly very embarrassed that she chose to go public with the apology rather than keep it between the parties involved; the couple has maintained the belief that it’s best to keep their relationship behind closed doors, considering their rabid “Twilight” fanbase and the fact that Hollywood romances are hard to keep going once the tabloids make them a sensation. It’s understandable that Pattinson should be blindsided by the admission, and by the way it was done. In the apology, Stewart said:

    “I’m deeply sorry for the hurt and embarrassment I’ve caused to those close to me and everyone this has affected. This momentary indiscretion has jeopardized the most important thing in my life, the person I love and respect the most, Rob. I love him, I love him, I’m so sorry.”

    A “source” close to Pattinson perhaps said it best:

    “As Rob told me, ‘She only had to call two people: me and Liberty.’”

    Liberty is the name of Sanders’ wife, and sadly hasn’t been focused on enough within this whole scandal. She has two children with Sanders, who directed Stewart in “Snow White And The Huntsman”. And while many of Stewart’s fans are urging Pattinson to forgive her, it’s hard to say whether or not Sanders’ wife will do the same.

  • Jenny McCarthy Excited About Relationship with Brian Urlacher

    Jenny McCarthy’s dating habits are always good for quick gossip. Over the weekend, I’m sure the most asked question amongst the young, hip, and connected was “Is Jenny McCarthy really dating Chicago Bears player Brian Urlacher?” Although rumors were circulating a few weeks ago that she had been dating the professional footballer, it would seem that the two are, in fact, a couple. For the time being, anyway.

    A close friend told the Chicago Sun Times that she “has really fallen for the guy. He’s such a man’s man, the most macho guy Jenny’s dated or been involved with for a long, long time.” Previously, McCarthy dated funnyman Jim Carrey, though that relationship ended famously in 2010. Since then, the former Playboy Playmate has been connected to sports agent Paul Krepelka, though that pairing appears to have come to a conclusion, as well.

    McCarthy is a fan of the strong, silent type? That’s news to me. If this is the case, why her relationship with Carrey lasted for so long is truly anybody’s guess.

    The couple was seen at a number of locations over the weekend, including RPM Italian, Studio Paris and Board Room. However, despite these public appearances, McCarthy isn’t ready to spill the beans just yet. However, she has told friends that she is extremely “giddy” about the prospects surrounding her new beau. When she’s ready to officially share her joy with the entire world, chances are you’re going to hear about it.

    Do people who spend a lot of time on Twitter care about McCarthy’s latest relationship? Of course they do! A selection of interesting responses to this throwaway story — both good and bad — have been included below.

    (image)@KevinPlantz
    Kevin Plantz    Why is the #1 trend on Yahoo about Jenny McCarthy dating a football player? People need to get a life. But seriously, she’s dating me.(image) 1 hour ago via web ·  Reply ·  Retweet ·  Favorite · powered by @socialditto

    (image)@ParisHiltonDagg
    Katelynn Bui    Brian Urlacher Had Dinner with Jenny McCarthy in LA: BR5+(image) 2 hours ago via web ·  Reply ·  Retweet ·  Favorite · powered by @socialditto

    (image)@kevinwmoore
    Kevin Moore    Saw Jenny McCarthy trending and thought, “Maybe she apologized for misleading people on vaccines.” Fat chance. Just stupid relationship BS.(image) 8 hours ago via web ·  Reply ·  Retweet ·  Favorite · powered by @socialditto

  • Hayden Panettiere is Big on Public Displays of Affection

    Hayden Panettiere embraced her Jets boyfriend Scotty McKnight while they were in Hawaii on Sunday.

    One activity that the couple enjoyed during their break was tennis. One source told US Weekly that she was driven to outplay her boy-toy, “She’s so competitive. She wanted to beat Scotty on every stroke. If she missed, she was upset with herself, but then would laugh. And Scotty would run over to the net and kiss her.”

    Her body is so fit that she played tennis in a bikini with no fear:

    (image)

    According to the following Tweet she had a great time with her hunky stud:

    Hayden is a big fan of the Jets and dated their quarterback Mark Sanchez. Her relationship with Mark helped her meet Scotty and they have gotten a lot closer over the past year.

    Panettiere’s most notable role to date is that of cheerleader Claire Bennet on the NBC series Heroes (2006–10), for which she won several awards.

    Do you have any vacation plans in the works?

  • Social Media’s Relationship with Politics

    Social Media’s Relationship with Politics

    If you are wondering if social media coverage effects voter turnout, public perception, and election results, than Nielsen has some great facts and figures for you. Analysts looked at online social media buzz for 50 days preceding four political races-two senate seats and two state governors. From September 2010 to November 2012, they measured how often candidates were mentioned and then compared it against who eventually won.

    The results are less than surprising, Candidates with the most buzz right before voting time won the election three out of four times. Pretty cool huh? Though the percentage of buzz for each candidate wasn’t equal to their share of votes, it was still a pretty good indicator of success.

    Overall, social media does seem to get people more engaged in the elections, and there’s some evidence that it has increased voter turnout. Perhaps candidates need to focus more on reaching voters via social media platforms. In the past we have always struggled to get voter turnout higher, perhaps sites like Facebook, LinkedIn, Twitter, and StumbleUpon could be more effective ways to do that.

    Anyway, here’s some charts on what they found with social media buzz vs. eventual election success rates:

  • Washington Post Masthead On A Chinese Government Publication

    Freedom of speech — and thus, consequently, freedom to advertise — are fundamental principles of a free democracy and a thriving capitalist democracy, right? That’s what we’re told in this country from a young age. Well it turns out those freedoms are also employed by the Chinese Communist Party. In America. Namely, in The Washington Post.

    This is the source of an ethical controversy that has sprung up recently in the arena of journalism. Each month, the Post runs a paid supplement called China Watch, along with a regularly-updated website of the same name. The “paid” part gets done by the Chinese government. In return, China gets to publish articles produced by China Daily, the house organ of the Chinese government, in the Post, and using its masthead. Articles in China Watch portray China and its government in the way you might expect–that is, positively, or else with a particular diplomatic glibness. Ad copy, some call it. Others call it propaganda.

    It’s a hard boundary to find, that line between advertising and propaganda. People who don’t like being sold to are quick to label all advertising as propaganda of a kind, while free market advocates might suggest that if you pay for it, and if you make it clear that you paid for it, then even a government can simply advertise. The Washington Post says that it makes no attempt to conceal the paid nature of China Watch. Both print editions of the publication and its corresponding website bear a small disclaimer box in their top right corners. But critics of the Post’s partnership with China Daily argue that the disclaimer is not nearly as prominent on the page as the Post’s masthead at the top of the insert. While readers have technically been informed that China Watch has been paid for, critics argue that the prominence of the Post’s masthead makes a bigger statement, confusing readers who might think the Post at least officially endorses China Watch content. The web-edition of the pro-China publication is hosted under the Washington Post domain name. Moreover, the Post neglects to disclose who pays for the ads.

    (image)

    Of course, there’s no law generally requiring companies to disclose details about their advertising partners to the general public. However, things are a bit different when you’re dealing with a representative from a foreign government. The Post’s dealings with China Daily could run afoul of the Foreign Agents Registration Act, which requires that foreign agents and their activities be properly identified to the American public. Such disclosure involves more than a box in the upper-right-hand corner.

    Nor is this the only instance of dealings where The Post has been accused of serving as a mouthpiece for the Chinese government. In an editorial last month, Patrick Pexton, The Post’s own Ombudsman, lambasted the newsroom for at the very best, lazy journalism, and at the worst, kowtowing to the Chinese PR machine. Particularly at issue in the editiorial was the February 13 publication in The Post of an “interview” with Chinese Vice President Xi Jinping. It was later revealed that the “interview” was hardly an interview at all — Post reporters submitted written questions to Jinping, and in return they received a response to questions that had been modified, deleted, and added. Pexton disagreed with the newsroom’s decision to print the reponse:

      So, The Post submits written questions — already a far cry from a live face-to-face unscripted interview with journalists — and the Chinese say, thanks, but we don’t like your questions, so we’ll provide our own questions and answers. Take it or leave it.

      The Post took it. I think it should have left it.

    Of course, Pexton pointed out, this is a complicated issue. While both the printing of the interview propaganda and the lack of transparency regarding China Watch suggest the Post is soft, even misleading, in its coverage of China, The Post also does its fair share of reporting that embarrasses the Chinese government and others. It’s a difficult world to navigate, especially when dealing with China, which often withholds press visas, or grows mum around reporters asking too many uncomfortable questions.

    It’s not just The Post that faces this difficultly. China is sitting on a billion citizens, nuclear weapons, the world’s fastest-growing economy, and $1.2 trillion of U.S. debt. So it has a lot of weight to throw around with governments and major corporations, let alone media outlets. But is it right for The Post to lend its masthead and domain name to China Watch? Pexton observes:

      That’s the thing about China, whether you are The Washington Post, the U.S. government or Apple computers. There is interdependence in the relationship, and constant negotiation and compromise. The Chinese know it, and they take advantage of it.

    Right might not always come into play these days.

    Hat Tip: The Washington Free Beacon

  • SWTOR: The Old Republic Same-Sex Relationship Exclusive Conan Coverage

    MMORPG’s are unique games which allow people to develop relationships within the system, which is built upon people working together and forming guilds. In doing so, real relationships can form, with many of them being same gender. Couple this with the fact BioWare has always allowed relationships within their games, more recently allowing homosexual relationships; now, gamers are wanting to see these same-sex relationship options in SWTOR.

    The game didn’t release with these same-sex options, but BioWare has announced that the feature will be coming in a recent update. The topic has been blowing up on the official SWTOR forums, with the thread climbing to 62 pages.

    When dealing with the topic of same-sex relationships, controversy always seems to be closely behind. You’ve no need to look further than the Family Research Council, which released this statement…

    In a new Star Wars game, the biggest threat to the empire may be homosexual activists! Hello, I’m Tony Perkins of the Family Research Council in Washington, D.C. In a galaxy not so far far away, Star Wars gamers have already gone to the dark side. The new video game, Star Wars: The Old Republic, has added a special feature: gay relationships. Bioware, the company that developed the game, said it’s launching a same-sex romance component to satisfy some complaints. That surprised a lot of gamers, since Bioware had made it clear in 2009 that “gay” and “lesbian” don’t exist in the Star Wars universe. Since the announcement, homosexuals have been celebrating the news, but parents sure aren’t. On the game’s website, there are more than 300 pages of comments–a lot of them expressing anger that their kids will be exposed to this Star Warped way of thinking. You can join them by logging on and speaking up. It’s time to show companies who the Force is really with!

    — sigh —

    The hub bub has lead to the story picking up a bit on the national scene, with Conan O’Brien really digging deeper into the story. Providing exclusive coverage of these same sex relationships (by “exclusive”, I mean hilarious and having nothing to do with the game)…

  • Is A Lack Of Communication Hurting Facebook’s Relationship With Developers?

    Is A Lack Of Communication Hurting Facebook’s Relationship With Developers?

    It would seem that Facebook has been pissing off developers again (though I’m not sure this ever truly stopped).

    A couple of fairly publicized complaints (at least within the developer community, courtesy of Hacker News) have drawn some response from Facebook. One, called “The Facebook Platform is a Trainwreck, Example #871” talks about how “there are few APIs more painful to work with than the Facebook API”.

    “The problem is not that the API is buggy and inconsistent. The problem is that Facebook doesn’t care if the API is buggy and inconsistent,” the author charges. It talks specifically about the Javascript SDK.

    The other post was “Facebook deleted their python-sdk repository without warning”.

    “Facebook has some sort of policy that they give 90 days’ notice for breaking API changes,” the author of that post writes. “I guess this doesn’t count? There’s a developer response where they basically say “We don’t have this anymore” with no explanation.”

    Emil Protalinski, writing for ZDNet’s Friending Facebook blog, shares some response he got from Facebook’s director of developer relations. “In short, he offered his apologies, cleared up some confusion, and promised Facebook still cares about developers,” writes Protalinksi. “Is that true? You be the judge.”

    “We absolutely do care about our API,” FB director fo devloper relations Douglas Purdy is quoted as saying. “We are working as hard as we can to make our API less buggy and more stable.”

    Facebook put out its latest “Operation Developer Love” list of platform updates. Here are some changes that Facebook developers can expect to go into effect on January 1, from the list:

    • Deprecating the FB.Data.* JS SDK APIs. This will be no longer supported and will not be available to new apps.
    • Deprecating FB.Canvas.setAutoResize. We have renamed FB.Canvas.setAutoResize to FB.Canvas.setAutoGrow so that the method more accurately represents its function. Fb.Canvas.setAutoResize will be removed.
    • Deprecating FBML FBML will no longer be supported as of January 1, 2012. Aside from security and privacy related bugs, we will not fix any bugs related to FBML after January 1, 2012. On June 1, 2012 FBML endpoints will be removed from Platform
    • All apps will be opted into “Upgrade to Requests 2.0” and “Requests 2.0 Efficient” Existing apps will be opted into “Requests 2.0 Efficient” and “Upgrade to Requests 2.0” migrations and all developers must ensure that they are using the correct request_id format and deleting requests appropriately. Details in this blog post
    • Enforcing Credits Policy We have added a new policy to the Facebook Credits Terms that prohibits routing Credits from one app to another app without our prior authorization.

    According to Facebook’s post, 197 bugs were reported in the last week-long period (12/21-12/27). 45 bugs were reproducible and accepted (after duplicates removed). 21 bugs were by design. 20 were fixed. 173 were duplicate, invalid, or need more information.

    Protalinski concludes that Facebook has a “serious communication problem” with developers. In Facebook’s report, it says there were 75 questions asked on facebook.stackoverflow.com over the weeek. Only 18 of them were answered, a 24% answer rate.

  • How Century 21 Utilizes Social Media to Connect with Consumers

    It’s always interesting to hear how brands, especially very traditional brands, utilize social media. Century 21 is one company that has embraced it extensively because, according to Matt Gentile, the Director of Public Relations and Social Media for the company, it is vital for businesses to embrace social and mobile platforms.

    For Century 21, a lot of first-time homebuyers are between the ages of 25-34, which is a group that is known for its social media activity. Gentile told us that Century 21 must follow these “digital natives” and reach them in the medium in which they spend most of their time – the social Web.

    “I think, for brands, it’s essential that you learn how to communicate effectively in those channels to reach the consumer,” he said.

    Gentile admits that, although social is significant in this day and age, it can be challenging for brands. He compared it to when brands first began to pull their advertising campaigns from print outlets and started advertising online. The challenging part for Century 21 is keeping the system members informed on the reasons for its decisions. However, Gentile believes that communication helps to overcome this challenge.

    Many brands also struggle with finding ROI in social media. Gentile told us that Century 21 has been able to turn many “likes into leads” by attaching a custom Bit.ly link to every piece of content it puts out in the social space. By doing this, it can track a lead from wherever it originated, be it Facebook, Twitter, YouTube, etc., and see what the pattern of the consumer is.

    Century 21 also recently released a new Facebook application that allows brokers to optimize their offices’ Facebook business page to better engage with consumers. Through the app, brokers can incorporate home listing info, Twitter feeds, blog posts, and more.

    Gentile told us that Century 21 would continue to embrace social media in order to improve connections with not only its more than 112,000 sales agents, but also consumers.

  • LinkedIn Reports First Earnings as Public Company

    LinkedIn released its first earnings report as a public company, and it wasn’t too shabby. They beat estimates and posted a 120% increase in revenue (YoY), and a new member increase of 61%.

    “In the second quarter, we saw record levels of members, unique visitors, and page views, while revenue growth further accelerated,” said CEO Jeff Weiner. “Going forward, we plan to continue to invest in our team, technology, and products in order to increase the value we deliver to members and realize the full potential of the LinkedIn platform.”

    Unique visitors were up 83% from the second quarter last year at 81.8 million per month.

    @LinkedIn
    LinkedIn    We saw growth across nearly all of our key metrics, including revenue, which grew 120% YOY to $121.0 million. $LNKD http://cmp.ly/F/LUDJtV 3 minutes ago via StockTwits Web · powered by @socialditto

    Here’s the release in its entirety:

    MOUNTAIN VIEW, Calif., Aug. 4, 2011 (GLOBE NEWSWIRE) — LinkedIn Corporation (NYSE:LNKD), the world’s largest professional network on the Internet, today reported its financial results for the second quarter ended June 30, 2011:

    • Members grew to 115.8 million, an increase of 61% from the second quarter of 2010
    • Unique visitors of 81.8 million per month, an increase of 83% from the second quarter of 2010
    • Page views of 7.1 billion, an increase of 80% from the second quarter of 2010
    • Revenue for the second quarter was $121.0 million, an increase of 120% compared to $54.9 million for the second quarter of 2010
    • Net income for the second quarter was $4.5 million, compared to $4.3 million for the second quarter of 2010; Non-GAAP net income for the second quarter was $10.8 million, compared to $6.4 million for the second quarter of 2010. Non-GAAP measures exclude tax-effected stock-based compensation expense and tax-effected amortization of acquired intangible assets
    • Adjusted EBITDA for the second quarter was $26.3 million, or 22% of revenue, compared to $11.5 million for the second quarter of 2010, or 21% of revenue
    • GAAP EPS for the second quarter was $0.04; Non-GAAP EPS for the second quarter was $0.10

    “In the second quarter, we saw record levels of members, unique visitors, and page views, while revenue growth further accelerated,” said Jeff Weiner, CEO of LinkedIn. “Going forward, we plan to continue to invest in our team, technology, and products in order to increase the value we deliver to members and realize the full potential of the LinkedIn platform.”

    Second Quarter Highlights and Strategic Announcements

    • In April 2011, LinkedIn opened up full access to the LinkedIn platform to developers, enabling them to build the professional Web. A number of new plug-ins were introduced, including the LinkedIn Share Button, which more than 100,000 publishers are now using to drive traffic to their sites. And later in the quarter, new Groups, Company, and Jobs APIs were introduced. LinkedIn now has more than 30,000 developers using its APIs.
    • LinkedIn extended its mobile presence with the April 2011 launch of LinkedIn for Android. In May, the flagship social news product, LinkedIn Today, came to the iPhone via LinkedIn for iPhone 3.6. In June, LinkedIn Today was added to Flipboard, giving professionals a new way to use the innovative iPad app to consume the news that matters to their professional lives. Mobile page views have increased approximately 400% year-over-year.
    • LinkedIn expanded its global footprint with the opening of an Asian regional headquarters in Singapore in May 2011 and a Northern European hub in Stockholm in June, bringing the total number of offices outside the U.S. to 12. Also in June, LinkedIn was made available to members in three new languages — Turkish, Russian, and Romanian, bringing the total to nine.

    Second Quarter Financial Details and Operating Summary

    LinkedIn reported revenue of $121.0 million for the quarter ended June 30, 2011, an increase of 120% compared to the second quarter of 2010.

    • Hiring Solutions: Revenue from Hiring Solutions products totaled $58.6 million, an increase of 170% compared to the second quarter of 2010. Hiring Solutions revenue represented 48% of total revenue in the second quarter of 2011, compared to 49% in the first quarter of 2011 and 40% in the second quarter of 2010.
    • Marketing Solutions: Revenue from Marketing Solutions products totaled $38.6 million, an increase of 111% compared to the second quarter of 2010. Marketing Solutions revenue represented 32% of total revenue in the second quarter of 2011, compared to 30% in the first quarter of 2011 and 33% in the second quarter of 2010.
    • Premium Subscriptions: Revenue from Premium Subscriptions products totaled $23.9 million, an increase of 60% compared to the second quarter of 2010. Premium Subscriptions represented 20% of total revenue in the second quarter of 2011, compared to 21% in the first quarter of 2011 and 27% in the second quarter of 2010.

    Revenue from the U.S. totaled $82.7 million, and represented 68% of total revenue in the second quarter of 2011. Revenue from international totaled $38.3 million, and represented 32% of total revenue in the second quarter of 2011.

    Revenue from the field sales channel totaled $66.7 million, and represented 55% of total revenue in the second quarter of 2011. Revenue from the online, direct sales channel totaled $54.3 million, and represented 45% of total revenue in the second quarter of 2011.

    Net income for the second quarter was $4.5 million, compared to $4.3 million for the second quarter of 2010. Adjusted EBITDA was $26.3 million in the second quarter of 2011, or 22% of revenue, compared to $11.5 million in the second quarter of 2010, or 21% of revenue.

    GAAP EPS was $0.04 based on 103.1 million fully-diluted weighted shares outstanding compared to $0.02 for the second quarter of 2010 based on 45.6 million fully-diluted weighted shares outstanding; Non-GAAP EPS was $0.10 based on 103.1 million fully-diluted weighted shares outstanding compared to $0.07 for the second quarter of 2010 based on 91.3 million fully-diluted weighted shares outstanding.

    “Strength in our engagement metrics, outperformance in our leveraged online channels, and a growing backlog with key corporate clients drove record revenues and adjusted EBITDA during the quarter,” said Steve Sordello, CFO of LinkedIn.  “We will continue to take a long-term perspective and invest aggressively in the global LinkedIn platform.”

    For additional information, please see the “Selected Company Metrics and Financials” page, updated through the end of the second quarter of 2011, on LinkedIn’s Investor Relations site.

    Business Outlook

    As of today, LinkedIn is initiating guidance for its third quarter of 2011 and full year 2011 revenue and adjusted EBITDA guidance.

    • Q3 FY11 Guidance: Revenue for the third quarter of 2011 is projected to be in the range of approximately $121 million to approximately $125 million. For the third quarter of 2011, the company expects to report adjusted EBITDA of approximately $9 million to approximately $11 million.
    • Full Year FY11 Guidance: Revenue for the full year of 2011 is projected to be in the range of approximately $475 million to approximately $485 million. For the full year of 2011, the company expects to report adjusted EBITDA of approximately $65 million to approximately $70 million.

    Quarterly Conference Call

    LinkedIn plans to host a webcast/conference call to discuss its second quarter 2011 financial results and business outlook today at 2:00 p.m. Pacific Time. Jeff Weiner and Steve Sordello will host the webcast, which can be viewed on the investor relations section of the LinkedIn website at http://investors.linkedin.com/. This call may contain forward-looking statements and other material information regarding the Company’s financial and operating results. Following completion of the call, a recorded replay of the webcast will be available on the website. For those without access to the Internet, a replay of the call will be available beginning at 5:00 p.m. Pacific Time on August 4, 2011 through August 11, 2011 at 9:00 p.m. Pacific Time. To listen to the telephone replay, please call (706) 645-9291, access code 75477524.

    About LinkedIn

    Founded in 2003, LinkedIn connects the world’s professionals to make them more productive and successful. With more than 120 million members worldwide, including executives from every Fortune 500 company, LinkedIn is the world’s largest professional network on the Internet. The company has a diversified business model with revenue coming from member subscriptions, marketing solutions and hiring solutions. Headquartered in Silicon Valley, LinkedIn also has offices across North America, as well as throughout Europe, Asia and Australia.

    The LinkedIn logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=9679

    Non-GAAP Financial Measures

    To supplement its consolidated financial statements, which are prepared and presented in accordance with GAAP, the company uses the following non-GAAP financial measures: adjusted EBITDA, non-GAAP net income, and non-GAAP EPS (collectively the “non-GAAP financial measures”). The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. The company believes that they provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making.

    The company excludes the following items from one or more of its non-GAAP measures:

    Stock-based compensation. The company excludes stock-based compensation because it is non-cash in nature and because the company believes that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding operational performance and liquidity. The company further believes this measure is useful to investors in that it allows for greater transparency to certain line items in its financial statements and facilitates comparisons to competitors’ operating results.

    Amortization of acquired intangible assets. The company excludes amortization of acquired intangible assets because it is non-cash in nature and because the company believes that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding operational performance and liquidity. In addition, excluding this item from various non-GAAP measures facilitates internal comparisons to historical operating results and comparisons to competitors’ operating results.

    Income tax effect of non-GAAP adjustments. Excluding the income tax effect of non-GAAP adjustments from the provision for income taxes assists investors in understanding the tax provision related to those adjustments and the effective tax rate related to ongoing operations.

    Assumed preferred stock conversion. As a result of the company’s initial public offering, all outstanding shares of preferred stock were automatically converted into shares of Class B common stock. Consequently, non-GAAP diluted net income per share has been calculated assuming the conversion of all outstanding shares of preferred stock into shares of Class B common stock.

    For more information on the non-GAAP financial measures, please see the “Reconciliation of GAAP to non-GAAP Financial Measures” table in this press release. This accompanying table has more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures. Additionally, the company has not reconciled adjusted EBITDA guidance to net income guidance because it does not provide guidance for stock-based compensation, other income (expense), provision for income taxes, and depreciation and amortization, which are the reconciling items between net income and adjusted EBITDA. As items that impact net income are out of the company’s control and/or cannot be reasonably predicted, the company is unable to provide such guidance. Accordingly, a reconciliation to net income is not available without unreasonable effort.

    Safe Harbor Statement

    “Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995: This press release and the accompanying conference call contain forward-looking statements about expected financial metrics such as revenue, adjusted EBITDA, and EPS, as well as non-financial metrics, such as member growth, page views and unique visitors to the company’s site, for the third quarter of 2011 and the full fiscal year and beyond. The achievement or success of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, the company’s results could differ materially from the results expressed or implied by the forward-looking statements the company makes.

    The risks and uncertainties referred to above include – but are not limited to – risks associated with the company’s short operating history in a new and unproven market; engagement of its members; the price volatility of its Class B common stock; expectations regarding the company’s ability to timely and effectively scale and adapt existing technology and network infrastructure to ensure that its website is accessible at all times with short or no perceptible load times; security measures and the risk that the company’s website may be subject to attacks that degrade or deny the ability of members to access the company’s solutions; members and customers curtailing or ceasing to use the company’s solutions; the company’s core value of putting members first, which may conflict with the short-term interests of the business; privacy issues; increasing competition in the market for online professional networks; and the dual class structure of the company’s common stock.

    Further information on these and other factors that could affect the company’s financial results is included in filings it makes with the Securities and Exchange Commission from time to time, including the company’s Form 10-Q that will be filed for the quarter ended June 30, 2011. These documents are available on the SEC Filings section of the Investor Information section of the company’s website at http://investors.linkedin.com/. All information provided in this release and in the attachments is as of August 4, 2011, and LinkedIn undertakes no duty to update this information.

    LINKEDIN CORPORATION
    CONDENSED CONSOLIDATED BALANCE SHEETS
    (In thousands)
    (Unaudited)
    June 30, December 31,
    2011 2010
    ASSETS
    CURRENT ASSETS:
    Cash and cash equivalents $ 352,854 $ 92,951
    Short-term investments 19,260 —
    Accounts receivable (net of allowance for doubtful accounts of $3,712 and $2,672 at
    June 30, 2011 and December 31, 2010, respectively) 70,241 58,263
    Deferred commissions 7,952 8,684
    Prepaid expenses and other current assets 12,047 5,767
    Income tax receivable 3,586 3,090
    Deferred income taxes 3,451 3,451
    Total current assets 469,391 172,206
    Property and equipment, net 83,033 56,743
    Goodwill 1,564 —
    Intangible assets, net 4,577 5,232
    Other assets 3,925 4,007
    TOTAL ASSETS $ 562,490 $ 238,188
    LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND
    STOCKHOLDERS’ EQUITY
    CURRENT LIABILITIES:
    Accounts payable $ 3,767 $ 2,064
    Accrued liabilities 48,844 38,003
    Deferred revenue 99,444 64,985
    Income tax payable 258 420
    Total current liabilities 152,313 105,472
    LONG TERM LIABILITIES 2,021 1,861
    DEFERRED TAX LIABILITIES 11,655 6,625
    Total liabilities 165,989 113,958
    COMMITMENTS AND CONTINGENCIES
    REDEEMABLE CONVERTIBLE PREFERRED STOCK — 87,981
    STOCKHOLDERS’ EQUITY:
    Convertible preferred stock — 15,846
    Class A and Class B common stock 10 4
    Additional paid-in capital 394,565 25,074
    Accumulated other comprehensive income (loss) 7 (3)
    Accumulated earnings (deficit) 1,919 (4,672)
    Total stockholders’ equity 396,501 36,249
    TOTAL LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND
    STOCKHOLDERS’ EQUITY $ 562,490 $ 238,188
    LINKEDIN CORPORATION
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    (In thousands, except per share data)
    (Unaudited)
    Three Months Ended Six Months Ended
    June 30, June 30,
    2011 2010 2011 2010
    Net revenue $ 121,040 $ 54,895 $ 214,972 $ 99,611
    Costs and expenses:
    Cost of revenue (exclusive of depreciation and
    amortization shown separately below) 18,403 9,842 35,186 18,147
    Sales and marketing 36,019 13,055 65,380 23,509
    Product development 30,414 14,822 55,149 26,963
    General and administrative 16,673 7,667 30,287 14,339
    Depreciation and amortization 9,602 4,201 17,761 8,141
    Total costs and expenses 111,111 49,587 203,763 91,099
    Income from operations 9,929 5,308 11,209 8,512
    Other income (expense), net 11 (357) 460 (703)
    Income before income taxes 9,940 4,951 11,669 7,809
    Provision for income taxes 5,427 658 5,078 1,701
    Net income $ 4,513 $ 4,293 $ 6,591 $ 6,108
    Net income attributable to common stockholders $ 4,513 $ 938 $ 6,591 $ 938
    Net income per share attributable to common stockholders:
    Basic $ 0.07 $ 0.02 $ 0.12 $ 0.02
    Diluted $ 0.04 $ 0.02 $ 0.07 $ 0.02
    Weighted-average shares used to compute net income per
    share attributable to common stockholders:
    Basic 69,395 42,232 56,631 42,100
    Diluted 103,129 45,624 100,131 44,927
    LINKEDIN CORPORATION
    SUPPLEMENTAL REVENUE INFORMATION
    (In thousands)
    (Unaudited)
    Three Months Ended Six Months Ended
    June 30, June 30,
    2011 2010 2011 2010
    Revenue by product:
    Hiring Solutions $ 58,619 $ 21,723 $ 104,953 $ 38,652
    Marketing Solutions 38,571 18,308 66,253 32,534
    Premium Subscriptions 23,850 14,864 43,766 28,425
    Total $ 121,040 $ 54,895 $ 214,972 $ 99,611
    Revenue by geography:
    United States $ 82,739 $ 40,299 $ 147,859 $ 72,834
    International 38,301 14,596 67,113 26,777
    Total $ 121,040 $ 54,895 $ 214,972 $ 99,611
    Revenue by channel:
    Field sales $ 66,699 $ 30,202 $ 117,327 $ 53,886
    Online sales 54,341 24,693 97,645 45,725
    Total $ 121,040 $ 54,895 $ 214,972 $ 99,611
    LINKEDIN CORPORATION
    RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
    (In thousands, except per share data)
    (Unaudited)
    Three Months Ended Six Months Ended
    June 30, June 30,
    2011 2010 2011 2010
    Non-GAAP net income and net income per share:
    GAAP net income $ 4,513 $ 4,293 $ 6,591 $ 6,108
    Add back: stock-based compensation 6,815 1,955 10,658 3,889
    Add back: amortization of intangible assets 862 53 1,671 107
    Income tax effect of non-GAAP adjustments (1,414) 134 (2,392) 535
    NON-GAAP NET INCOME $ 10,776 $ 6,435 $ 16,528 $ 10,639
    GAAP diluted shares 103,129 45,624 100,131 44,927
    Add back: assumed preferred stock conversion — 45,647 — 45,647
    NON-GAAP DILUTED SHARES 103,129 91,271 100,131 90,574
    NON-GAAP DILUTED NET INCOME PER SHARE $ 0.10 $ 0.07 $ 0.17 $ 0.12
    Adjusted EBITDA:
    Net income $ 4,513 $ 4,293 $ 6,591 $ 6,108
    Provision for income taxes 5,427 658 5,078 1,701
    Other (income) expense, net (11) 357 (460) 703
    Depreciation and amortization 9,602 4,201 17,761 8,141
    Stock-based compensation 6,815 1,955 10,658 3,889
    ADJUSTED EBITDA $ 26,346 $ 11,464 $ 39,628 $ 20,542 
    CONTACT: Press contact

         Hani Durzy

         hdurzy@linkedin.com

         650-605-0829

         Investor contact

         Marilyn Lattin

         mlattin@linkedin.com

         650-605-0711

  • Public Engagement Takes More Than One Media Platform

    Public Engagement Takes More Than One Media Platform

    There was a full house at the The Kenneth Owler-Smith Symposium at the Annenberg School for Communication and Journalism at USC last night.  Steve Rubel of Edelman spoke about how PR and journalism are changing and the need for companies and organizations to expand their view of media and media relations.

    The Internet has created more than one new way to reach your and engage your audience:

    • companies can now publish their own content
    • consumers have a voice
    • influential digital news properties, like The Huffington Post, Mashable and Tech Crunch, have emerged

    Which is a good thing, since research now shows that to effect behavioral change, people have to see or hear something at least 3 -5 times.  In developed countries, where there is so much more information overload, that figure jumps to 9 times!

    To reach your audience in multiple ways Rubel advises that you work your content across four inter-related media platforms:

    1. The first is Traditional Media, which still has influence.
    2. The next is the Digital News Media –  make sure that your content appears in the relevant digital news outlets that have sprung up.
    3. Owned Media – Every company can, and should, be a media company – in addition to their core business. Create blogs and curate industry news.  Set up  a social media online newsroom that invites people in and creates spaces for them to find and share content that interests them.  Connect them to one another.
    4. Social Media – Spread the right content to the right people using social platforms and feeds.

    All of which creates a trans-media storytelling strategy that will connect with your audience in multiple places and create those 5 – 9 touch points needed to get their attention and move them to action.

    Originally published at the proactive report

  • In PR, There’s No Such Thing As A One-Day Story

    In PR, There’s No Such Thing As A One-Day Story

    Yesterday, I wrote about how NBC has handled Keith Olbermann’s departure from his show on MSNBC. Writing that story put me in mind of one of the hoary chestnuts of public relations strategy, which is to let sleeping dogs lie for some situations. Veteran PR folks are fond of refering to a minor flap as a "one-day story," meaning that you read about it in the newspaper today, but it disappears tomorrow. Unfortunately, the Internet has forever ended the technique of letting the storm blow over.

    First, it was Google.

    Stories that broke years ago are still easily found by searchers, whether they are looking for them or not. I have clients (they’d love not to be named here) where you can search on their company name and find (as search result #4 or #5, perhaps) a negative story about them. In some cases the story isn’t even true—the classic situation where PR people counsel the on-day story approach.

    The reasoning always went that some stories are so unfair that it is best "not to dignify them with a comment," the idea being that responding to the spurious charges just "kept the story alive" in the press. If the charges hit on Monday, then your response becomes the story on Tuesday, with even more people hearing about those falsehoods. Not responding, the reasoning goes, ended the negative publicity on day one. People would have to stop by the local library to go back and read about that story after Monday.

    This clearly the thought process of a bygone era, now that we are in the age of Google, but I still sometimes hear well-meaning people provide this advice. I no longer hear this from too many PR professionals—most have figured out what we need to do differently—but I often hear business people parrot this advice because years ago they heard some smart person say it. We all need to accept that this world has changed.

    Google can turn up any story on you, even years later. As they used to tell you in school, "It’s part of your permanent record." Your only safe strategy is to respond so that when people find the story, they also find your response.

    But Google isn’t the only factor in this changed world. Social media has also made a huge difference, because blogs, Facebook, Twitter, and YouTube keep stories alive day after day. (I did this yesterday with the Keith Olbermann story.) As each pundit chips in with their opinion, more and more people hear about the original story. And when they do, they Google it even more to learn more details. If all that is out there is the negative charge, then people will make up their minds without your side of the story.

    I know that responding is scary. It feels safer to let the story run its course without your comment. It feels like your comment can only "add fuel to the fire," and the truth is that you do run that risk. If you provide a ham-handed lame answer, expect to be pilloried. But the right answer can nip a crisis in the bud. The right answer can change people’s minds. The right answer can protect your brand image. The right answer can rally your supporters to your defense.

    No answer can’t do any of those things, and leaves your reputation in the hands of your critics. You wouldn’t do that with any other corporate asset, so it’s time to stop talking about the "one-day" story.

    Originally published at Biznology

  • Why Social Media Practices Are Like Football

    Co-authored by Jay Baer and Amber Naslund

    One of the continuous discussions and questions surfacing in the social media chatterbox is that of “who owns social media?” Is it marketing? Public relations (PR)? Customer service?

    The answer is . . . yes. For the long-term, anyway.

    You’re not likely at the point yet where you have social media wired into everything. Right now, you may just be trying to figure out where to get started and deciding who is responsible for managing it and accountable for the results that grow from it. That’s perfectly okay, and it’s where a lot of organizations begin.

    As social media adoption expands in an organization, however, you need a model that’s scalable and provides some autonomy within other functions and units but that maintains some central coordination for the purposes of consistency and clear communication. For that, let’s look to the football field for inspiration.

    3 Key Roles to Make Your Social Team Scalable 3 Key Roles to Make Your Social Team Scalable

    See all graphics from the book at http://nowrevolutionbook.com

    The Coaching Staff

    The coaches are an organized, recognized group that acts as the hub for all things social media within a company. It can be small, with just a few people, or larger, with broad representation from a number of areas. If there’s already a dedicated social media team in your company, they often form the core of this group and are deeply active participants and advisors.

    Coaches are responsible for making things happen in their own areas of the business, such as customer service, marketing, or product management. Each department might have one or two coaches who are represented as part of the larger group. Coaches take knowledge and consensus from the group regarding overall social media strategy and apply this information to the day-to-day functions of their team. They also bring back challenges, information, and successes to share with the other members of the coaching staff so that everyone can learn from one another.

    They might work on:

    Leadership: Championing social media strategies to management and throughout the organization to encourage participation

    Intent: Laying out the underlying tenets and purposes for social media participation as an organization

    Guidance: Developing social media participation guidelines – not just rules and regulations – that everyone can adopt and get behind

    Best Practices: Be the center for subject matter expertise around the world of social media

    Coordination: Keeping of the messy bits of internal communication and coordination around social media implementation

    The Players

    The players are the social media in action throughout the organization. Although the coaching staff is the center for overall social media approach, each coach works with his players to develop goals, strategy, and success metrics for their area of the business. The players are made up of the front line listening and response teams that actively mine social media for information, and they are the ones who act on what they find.

    Information gatherers form your centralized listening centers, monitoring the social web and mining it for relevant information, and they make sure that information gets to the people that need it. They might interact on behalf of the company as well, but their chief responsibility is to locate information for others to act. These players are early warning systems, researchers, and the information filters of corporate social media.

    Frontline responders will be the faces of your company. They are the ones who work in a public light to either react to the needs and demands of your online community or provide a public-facing persona and presence for your brand. They conduct the proactive engagement and participation online to connect with customers, prospects, and the community as a whole. Social media and community management professionals are frontline responders, as are your communication teams and your customer service teams.

    The Booth

    Everyone in your company is affected by the speed and scale of social media, even if some corners are affected in a nonpublic way. These are the members of the booth—social media stakeholders whose participation may not be daily but is no less important.

    Your writers and creative types might be part of the booth and build communication strategy. Human resources can focus social media efforts externally for employee recruitment or internally for talent retention. Research and development and product management capture insights from customers or the competition. Legal and compliance can focus on managing risk while adapting to an environment with less control. Analysts can derive actionable insights from data and feed those back to teams, and even IT can evolve their operations to support more fluid internal communication networks.

    What ties all of these people together is the unifying work of the coaching staff. Departments take the strategic cues from the coaches and apply them downstream to their teams. They build independent, autonomous strategies that integrate with the larger whole, providing a networked but nimble approach to social coordination that can work for any company of any size.

    The increasing speed of business calls for a distribution of decision making and authority throughout an organization to make us quicker, more nimble, and more responsive to the demands of immediacy. We need teams that communicate faster, with more fluidity and less friction. And to do that, we simply have to shatter the bottlenecks of process and control that have historically created a sense of security and consistency.

    It’s time to organize our people and communications in a way that allows the elephant to dance much lighter on its feet.

    Originally published at convinceandconvert.com

  • Reputation Management Should Be Proactive, Not Reactive

    Fionn Downhill, CEO of reputation management firm Elixer Interactive and Attorney Geoffrey Wozman spoke in a session at SES Chicago called "Brand, Trademark & Reputation Management." Downhill says online reputation management combines marketing and public relations. 

    The web can be great place for a brand to thrive and pick up steam, but it can also go the opposite way. A single blogger can take down a brand. "That’s the reality of the web," says Downhill. It can go the way of Dell or it can go the way of Tiger Woods (or somewhere in between). 

    Downhill’s advice is to be proactive, rather than reactive, when it comes to brand reputation. I take this to mean that you should be putting yourself out there with as much positivity as possible to begin with, as opposed to waiting for someone to trash your brand, then defending yourself. Even if such trashing is unjustified, like Downhill says, it only takes one blogger to hurt your brand, and there’s a chance some potential customers will only see that side of the story. The more positivity you put out, the more likely they are to find something good to latch onto. If someone sees a lot of good things, then one bad blog post won’t carry as much weight. 

    Downhill Talks Reputation ManagementIn fact, Downhill suggests never engaging brand attackers at all. If they’re attacking you on blogs, forums, and social media, you might be better off simply addressing such complaints on your own blog and defending yourself from there, than using SEO to work on the visibility of your side of the story. Taking legal action, can be an expensive "black hole", she says. As far as as responding to attackers on blogs, social networks, etc. I would say it’s a judgment call. If I’m getting trashed on a well-trafficked forum that attracts a lot of interest within my niche, for example, I’m probably going to want to respond accordingly. 

    Wozman adds that free speech is protected online by the Constitution (at least in the U.S.) and that only false accusations are considered defamatory – not opinions. You can call someone a jerk, but not a criminal. Commenters cannot be held liable because of the Communications Decency Act, and ISP providers cannot be held liable for commenters. 

    Downhill recommends buying domains like "yourbrand sucks.com" and any other version of your brand’s domain that is defamatory, that you can think of. Not a bad idea, but it could get expensive depending on how creatively your mind works. Either way, those out to ruin you can probably get pretty creative in that department. 

    At BlogWorld last week, I attended a session about brand monitoring. This was not so much about reputation management only, but simply being able to spot the conversations that are happening in relation to your brand, and getting involved in conversations (including positive ones regarding your brand). Ann Peavey, Becky McCray, and Sheila Scarborough gave some good tips. More on that here.

    WPN’s Mike Sachoff contributed to this piece. 

  • NewsBasis Aims to Be Basis for News-Maker, News-Breaker Relationships

    In a nutshell, NewsBasis is a site where journalists and bloggers can find sources, while experts and companies can find journalists and bloggers to write about them in their articles.

    WebProNews had a conversation with NewsBasis Founder and CEO Darryl Siry (who also happens to be a contributor to Wired, and was formerly CMO of Tesla Motors) about how the site has performed since launching at the beginning of the month.

    "Initial participation was well beyond what I had been planning for, which is a good thing, but keep in mind I am not fully satisfied until we are used by all folks in the media industry on both sides of the table," Siry tells us.

    We asked about participation from both journalists and experts. "The participation on the company rep side is a good mix of companies, PR agencies, independent professionals, academic institutions and non-profits," he says. "On the journalist side you also see a broad range of participation, from bloggers to regional newspapers to major news organizations."

    Perusing article topic requests on NewsBasis, one can find various familiar names and publications. That’s got to be encouraging for the company.

    Darry Siry, CEO and Founder of NewsBasis"Of course, there are more experts/companies using the service than journalists, but that’s what I would expect as that reflects the industry," he continues. "There are many more people seeking attention of reporters than there are reporters, and it is important to have deep inventory of experts and sources."

    I don’t think he’ll get many arguments from reporters there.

    Siry certainly knows how the game is played, as he has written not only for Wired, but for other publications like VentureBeat and Business Insider. Combine that with marketing gigs he has held in the past. He’s clearly played on both sides of the ball.

    As user experience plays greatly into the success of any product, we also asked for plans about upcoming features.

    "We are balancing customer acquisition activities with our pace of product development," Siry tells us. "There are lots of great features and tweaks that we have been working through and as the product gets better I expect that we will see more users come on to the system. We have features already built in to the system that we haven’t really promoted because you can only say so much in a marketing message, so part of my challenge is to educate existing customers about how full featured we are."

    "For example, we have built in real time news alerts that work quite well and we also have a robust annotation and sharing system that can be used by journalists for online research," he explains.

    Of course, users can always keep abreast of the latest NewsBasis happenings on the company blog, which has provided numerous updates since the early August launch of NewsBasis.

    Journalists, bloggers, and brands all potentially have a lot to gain from a system like NewsBasis. At this point, it’s just a matter of attracting the users, and getting them to stick with it. This appears to be the main area of focus for the company at the moment. In fact, Siry emailed me personally to let me know that I hadn’t activated my account after initially signing up, weeks ago. It worked. I logged in that day. 

  • PR Firm Settles FTC Charges Over False Reviews On iTunes

    A public relations firm hired by video game developers will settle Federal Trade Commission charges it engaged in deceptive advertising by having its employees post favorable reviews on iTunes on behalf of the developers and not revealing the reviews came form paid employees.

    Mary-Engle-FTC “Companies, including public relations firms involved in online marketing need to abide by long-held principles of truth in advertising,” said Mary Engle, Director of the FTC’s Division of Advertising Practices.

    “Advertisers should not pass themselves off as ordinary consumers touting a product, and endorsers should make it clear when they have financial connections to sellers.”

    Under the proposed settlement order, Reverb Communications, Inc. and its owner, Tracie Snitker, are required to remove any previously posted endorsements that misrepresent the authors as independent users or ordinary consumers, and that fail to disclose a connection between Reverb and Snitker and the seller of a product or service. 

    The agreement also bars Reverb and Snitker from misrepresenting that the user or endorser is an independent, ordinary consumer, and from making endorsement or user claims about a product or service unless they disclose any relevant connections that they have with the seller of the product or service.

    Between November 2008 and May 2009, Reverb and Snitker posted reviews about their clients’ games at the iTunes store using account names that gave readers the impression the reviews were written by disinterested consumers, according to the FTC complaint.  Reverb and Snitker did not disclose that they were hired to promote the games and that they often received a percentage of the sales.
     

  • CIPR Looking For Suggestions Regarding Social Media Guidelines

    The Chartered Institute of Public Relations (CIPR) wants your help to develop a best-practice set of guidelines on using social media in PR practice.

    According to the CIPR’s Social Media Panel, the open consultation is designed to help ensure that the guidelines reflect best practice, capture expert thinking and reflect new technologies, tools and ways of working, as they develop.

    If you have a constructive point of view about social media in UK public relations practice, you can add your voice, whether or not you’re in PR or even a CIPR member.

    […] We welcome input from practitioners, industry bodies and any other groups keen to develop social media thinking and best practice. This is and should be a collaborative effort for the public relations profession.

    The existing CIPR social media guidelines – first developed in early 2007 and last updated in 2009 – have been posted to a CIPR wiki to enable collaborative reviewing and editing. You can find it here:

    http://ciprsm.wikispaces.com/guidelines-review

    A quick review of some of the content posted there shows just how fast things have changed in PR practice, what comprises social media these days and how it’s used from the PR perspective. Good timing to update this material.

    The open consultation period runs until the end of September and the CIPR’s goal is to publish updated guidelines in October.

    Comments

  • Top Public Figures That Influence Purchases

    Top 10 People Who Influence What Americans Buy

    As the effects of the global recession linger, consumers are changing the way they shop, becoming more budget-conscious, eco-aware and cause-oriented, while paying greater attention to what, why and from who they are buying. Arnold Worldwide has named the top ten public figures, across entertainment, business and politics, who are helping to promote the era of “mindful spending.”

    Andrew Benett, Global CEO of Arnold Worldwide and Global Chief Strategy Officer of Havas Worldwide, describes the downfall of hyperconsumption and the rise of “the new consumer” in his forthcoming book, Consumed: Rethinking Business in an Era of Mindful Spending (Palgrave Macmillan, July 2010), co-authored by Ann O’Reilly, Content Director of the Euro RSCG Worldwide Knowledge Exchange.

    Despite the fact that glitz and abundance are alive and well in mainstream media (think: Bravo’s The Real Housewives and E!’s Keeping Up with the Kardashians), there is a fast-growing set of Americans who reject excess and artificiality in favor of authenticity, substance and interconnectedness. In fact, according to a groundbreaking survey of 5,700 adults in seven countries conducted for Consumed, nearly 80 percent of Americans feel society is becoming too shallow and believe most of us would be better off if we lived more simply.

    “For the last two decades, Americans believed bigger was better—from the size of our houses to our cars to the amount of food on our dinner plates. But the economic recession, coupled with other factors like the green movement, is fundamentally changing American attitudes,” said Benett. “Instead of super-sizing, we’re ‘right-sizing’ and re-evaluating what’s important in life. We’re saving more, wasting less, and giving back.”

    Benett further states: “Mindful consumers are taking a closer look at what we truly need and adjusting our shopping behaviors accordingly. As part of that, we are embracing brands that uphold these new ideals, brands that provide quality and value in their services and products, but are also environmentally friendly and socially responsible.”

    In recognition of the new book Consumed, here is a list of ten public figures who embrace qualities of the mindful consumer, such as a commitment to sustainability efforts, a focus on giving, and a more thoughtful approach to consumption:


    Ludacris
    Rappers are not always known for their humility, generosity and environmentally conscious attitudes; Ludacris isn’t your average rapper. Through The Ludacris Foundation, he has donated $1.5 million to support youth-oriented, grassroots organizations and devoted more than 5,000 hours of service, all while paying special attention to his hometown of Atlanta. Did we mention that Ludacris owns a hybrid and is installing solar panels on his home?


    Suze Orman
    While the financial market collapsed, Orman’s stock rose as she convinced people what NOT to buy during the economic recession. She is viewed as a trusted financial expert, helping Americans become fiscally responsible through her television show, eight consecutive New York Times bestsellers, and frequent guest spots on a range of programs from Oprah to The Biggest Loser.


    Indra K. Nooyi
    As the CEO of PepsiCo, Nooyi wants those of us who indulge in sugary beverages to feel a little better about it. She’s championing “performance with a purpose” within the organization, which is focused on creating more wholesome products and increasing sustainability practices. As part of this effort, the company has launched The Pepsi Refresh Project. The socially driven campaign allows individuals and organizations to post their philanthropic ideas on refresheverything.com, where the general public votes for their favorite initiatives to be funded. To help support the project, which will give away more than $20 million this year, the company passed on airing a Super Bowl ad.


    Ellen DeGeneres
    Comedienne, actress, author, CoverGirl spokesmodel, American Idol judge, talk-show host, and wife. . . Ellen DeGeneres does it all. Using her large media presence, she exposes audience members to different charities including Feeding America and the American Red Cross. DeGeneres conceals her wealth with ordinary clothes and a gracious attitude, influencing a legion of supporters through her television shows and brand sponsorships.


    Taylor Swift
    Unlike her flashy counterparts, such as Miley Cyrus and Lady Gaga, there’s something genuine and down-to-earth about Swift that makes her stand out among the tween, teenage and young adult set. With her poised demeanor, saccharine pop-country crossover songs, humanitarian efforts for numerous charities, and penchant for affordable clothing—including her line of Walmart-sold sundresses that start at $14—this young superstar personifies the mindset of a new generation who want to feel good, look good and do good with (age-appropriate) style.


    Warren Buffett
    The world’s third-wealthiest person, Buffet is famously known for both his mindful spending and philanthropy. America’s foremost investor still owns the modest home bought in 1958, receives a salary of approximately $100,000 and rarely makes extravagant purchases. Most recently, Buffet auctioned off a lunch with himself that sold for $2.63 million, which will support Glide Foundation, a homeless organization based in San Francisco.


    Oprah Winfrey
    As proven time and again, the mere mention of a product by Oprah will make it a bestseller. Her personal integrity, philanthropic efforts and ability to connect with the masses will help her stay one of America’s favorite trendsetters long after her talk show ends in 2011. Up next: Oprah will start the Oprah Winfrey Network (OWN), further exploring issues surrounding empowerment, spirit, human relationships and giving back.


    Stephen F. Quinn
    More than three-quarters of Americans shop at Walmart every year, so whether you’re a fan or not, the retailer has influence. As Walmart’s CMO, Quinn’s leadership on sustainability efforts has a huge impact. He helped initiate strict environmental standards including high efficiency store designs, reusable bags, recycling programs and the installation of solar panels. In addition, Walmart is helping shoppers go green by introducing more energy-efficient products; locally grown produce; and the Sustainability Index, an initiative that, in the company’s own words, is “helping to create a more transparent supply chain, driving product innovation and ultimately providing our customers with information they need to assess products’ sustainability.”


    Mark Zuckerberg
    Zuckerberg makes the list not because he is particularly mindful, but because the platform he created is making savvier shoppers out of all of us. With more than 400 million active users worldwide, Facebook has become an interactive consumer haven. With the simple update of a status feed, users can get product recommendations from the most trusted source: friends and family. Plus, the platform provides a voice to grassroots organizations that want to galvanize people around the world quickly and efficiently. Brands like Coca-Cola, Starbucks and Disney are realizing the platform’s potential by generating huge fan followings, making it a marketer’s paradise. And with Zuckerberg’s influence over Internet privacy policies, he is literally changing the way we shop.


    Michelle Obama
    With the grace of Jackie and the aspirations of Eleanor, Michelle has captivated Americans. When the First Lady donned J.Crew fashions at public appearances such as The Jay Leno Show, it spiked the retailer’s clothing sales, website traffic and brand awareness. However, it is Obama’s efforts to end childhood obesity with initiatives like “Let’s Move” and the White House vegetable garden that are inspiring a nation. She is influencing (and, in some cases, incentivizing) politicians, business leaders, nonprofits, parents and the rest of us to think about what we consume.

    Comments