Month: May 2018

Amazon Challenges Google and Facebook For Ads Dominance

Posted on by Rob Burdett

Reports that Amazon.com Inc has doubled its ad profits, is growing its ad business fast, and may be outselling ads on Twitter Inc and Snapchat, may soon see it in serious contention for ad dominance with its bigger rivals : Google and Facebook.

Multi-Billion Dollar Program

Reports that Amazon has achieved around $2 billion advertising revenue and with predictions by eMarketer last October that Amazon would hit $3.19 billion in net U.S. digital ad revenues by 2019 (which is 3.0 percent of digital ad spending), show that Amazon clearly has a multi-billion dollar program underway that is growing fast.

How?

Some commentators put the rapid and impressive rise in ad revenues down to the fact that Amazon has two non-retail businesses that are experiencing fast growth, and are profitable.

Firstly, Amazon’s fastest-growing business segment, which hit $2.0 billion in the first quarter, and showed a 72 % increase from a year earlier, and 100% growth in the last quarter is its “other” section. This segment is mainly Amazon’s growing advertising business which is experiencing strong demand from advertisers that spend money to highlight their products over competitors’ in Amazon’s catalogue. The ad business now generates multiple billions in revenue. For example, the world’s largest advertising company, WPP, directed $200 million of its clients’ ad budgets to Amazon in 2017, and has also predicted that this number could rise to $300 million this year.

Secondly, Amazon’s other key profit driving non-retail business is Amazon Web Services (AWS). This leases computing power and data storage to companies large and small, and has just experienced a 40% growth. The fact that AWS has earned $17.5 billion in 2017 compared to its $9.2 CapEx spending means that it is even making a profit from a business that typically requires a huge amount of investment. For example, Amazon Web Services (AWS), Microsoft, and Google collectively spent $35 billion on data centres to power their cloud businesses in 2017.

One key thing that both of these important business segments have in common is that they deliver big profit margins. For example, AWS’s operating profit margin is consistently over 20% and Amazon’s ad business also contributes big profits to the company’s main bottom line.

Some commentators have said that Amazon’s strong position in the Cloud market, search and advertising, and the voice assistant market with Alexa are boosting the competitive position of the company as well as its profits.

In Competition With Google and Facebook?

This huge surge in advertising profits is still not quite in the same ballpark as Google and Facebook’s Internet duopoly, with Google and Facebook accounting for more than 60% of global online ad revenues, although Amazon is now on the right trajectory to start taking more of their business.

What Does This Mean For Your Business?

Amazon has expanded and diversified in recent years and the big advantages of its advertising that are attracting more business customers are its reach, the fact that Amazon has users’ purchase data and knows what shoppers need, and the fact that advertising on Amazon is delivering results for customers in terms of driving brand awareness, discovery or/and purchases.

These recent ad revenue figures show that although Amazon isn’t seriously challenging Facebook and Google just yet, it is generating significant profits from non-retail parts of its business, and is certainly going in the right direction to challenge the current duopoly. For businesses, this gives them more choice, and another potentially effective advertising platform that could drive more potential buyers their way.

Fake Online Reviews Investigation

Posted on by Rob Burdett

A recent investigation as part of a BBC 5 Live programme has led to the underground trade in fake online reviews coming under the spotlight.

What Reviews and Why Does It Matter?

The kinds of reviews of products and services that can allegedly be purchased and displayed online in order to influence purchasing decisions are reported to be those on sites such as Trustpilot and Amazon.

Three quarters of UK adults use online review websites, and the government’s Competition and Markets Authority estimates that such reviews potentially influence £23 billion of UK customer spending every year.

Younger consumers are thought to be particularly influenced by the reviews of others / their peers when it comes to purchasing decisions.

The key motivator for businesses buying fake reviews is, orf course, to rank top for your product because this can lead to a lot of extra sales.

How Bad Is The Problem?

A Chartered Institute of Marketing (CIM) Study shows that almost half of UK adults believe they have seen fake reviews, and according to US analysts, as many as half of the reviews for some products posted on international websites like Amazon may be potentially unreliable

What’s Been Happening?

According to the recent BBC investigation of the problem, buyers are offered full refunds on products bought on Amazon in exchange for positive reviews. This practice is believed to be something that was driven underground back in 2016 after Amazon introduced measures designed to prohibit ‘incentivised reviews’ i.e. businesses offering customers free goods in exchange for positive reviews.

The BBC 5 Live team investigators have reported that they were offered deals for Amazon reviews, and were able to use eBay to purchase a false 5-star review on Trustpilot.
Denied

In response to the findings of the BBC investigation, Amazon has stated that it does not permit reviews in exchange for compensation of any kind and that customers and Marketplace sellers who don’t follow review guidelines are subject to action including potential termination of their account.

Trustpilot has said that it uses specialist software to screens reviews against 100’s of data points around the clock in order to automatically identify and remove fakes, and that it has a zero-tolerance policy towards any misuse.

E-bay has also stated that the sale of fake reviews is banned from its platform, and that any listings will be removed.

What Does This Mean For Your Business?

The potential rewards of more sales an profits, getting a competitive edge, and boosting brand awareness are powerful motivators for some businesses who may feel that when weighed up against the lack of any serious penalties, buying fake reviews may appear to be worth the risk. For the vast majority of review-reading customers, however, this is a deceptive practice that may cause them to purchase products that do not meet their needs or expectations.

The proliferation of fake reviews also undermines public trust in reviews, and this can be particularly unfair for those companies who have worked hard to get genuine positive reviews through simply providing superior products and service levels.

There is an argument that more preventative action needs to be taken by these platforms to stop fake reviews being published in the first place, and that stronger penalties are needed for those caught selling fake reviews.

Sadly, many commentators believe that we are currently in a ‘post-truth era’ where many people get their news from social media and where we are becoming conditioned to put less emphasis on the need for objective facts. It is with this backdrop that the trade in fake reviews has been allowed to grow.

There is still a strong argument, however, that there is no substitute for striving to provide quality products and great customer service as these strengthen a business anyway, ensure that reviews are positive, and should ultimately win over short-term deceptive practices.

Online Dating Via Facebook

Posted on by Rob Burdett

Facebook CEO, Mark Zuckerberg, has announced that Facebook, the world’s largest online social network, will soon be providing an online dating service, thereby putting it in competition with the likes of Match Group Inc.

On The Cards

Bearing in mind Facebook’s origin as a college dating website and Mark Zuckerberg’s early ‘Facemash’ program, and the fact that Facebook is known to have been wanting to move into online dating for at least 10 years, this move has been on the cards.

Why Now?

There are several key reasons why Facebook has chosen to actually make the move into the online dating world. These include:

  • The need to make people spend longer on the Facebook platform (and not on other platforms). For example, time spent by Facebook users on the platform fell by 50 million hours a day in 2017.
  • The need to attract more young people to the platform.
  • The commercial attractiveness of the booming and growing dating market.
  • The fact that there are 200 million people on Facebook that list themselves as single.
  • The fact that Facebook already holds many facets of information about users that could be used for matching and dating purposes e.g. interests, local events they could attend.

How Will It Work?

The proposed platform is an optional feature that users will be able to use by clicking on a heart shape at the top-right corner of the Facebook app, and setting up a dating profile. The profile will be based on a first name, won’t be visible to friends and users who aren’t on the dating feature, and won’t show up in the News Feed.

Once set up, users can browse events in their local and groups that match their interests, select ‘unlock’ for dating, and then be able to see the profiles of other potential dates who have unlocked that surface. These profiles will show a few photos plus some basic information about potential dates.

The system will not work using the “swipe” left or right on potential matches like Tinder, but there will be two buttons for “pass” and “interested.”

Users will be able to start a conversation with a potential match by commenting on one of their photos, but the conversations will be text-only, thereby eliminating the risk of unsolicited nude photos being sent. Conversations will take place in a special inbox that’s separate from Messenger and WhatsApp.

Security

In the wake of the Facebook and Cambridge Analytica scandal, Facebook has been quick to stress that the service has been built and will operate with an emphasis on privacy.

Not Just Hook-Ups

Facebook has also said that the new dating service is intended to be a standalone feature that will focus on legitimate long-term relationships, rather than just hook-ups. There are already many stories of couples who have met via the normal Facebook platform.

Dating Service Competitors – Stock Value Falls

Shortly after Mark Zuckerberg announced the move into the dating arena, and even though Match Group CEO Mandy Ginsberg said that she was flattered by Facebook’s entrance into its space, Match’s stock traded down about 22%. Match is the owner of mobile dating apps Tinder and OkCupid and describes itself (on its website) as the “global leader” in online dating.

What Does This Mean For Your Business?

If it wasn’t for the recent scandal about data sharing with Cambridge Analytica and the lack of trust that it has created, Facebook would be almost perfectly position to seriously and quickly take on the current online dating giants such as Match. It remains to be seen, therefore, how quickly Facebook users forget or are willing to throw caution to the wind with the promise of powerful motivators and positive reinforcement in the form of dates and possibly, a love match.

Some competitors, such as Bumble, have seen Facebook’s move as an opportunity rather than just a threat, and Bumble has reportedly reached out to Facebook to explore ways to collaborate.

Google Chrome Leads Digital Certificate Clean Up

Posted on by Rob Burdett

The Google Chrome Browser is being equipped with transparency logs that are designed to prevent potentially costly digital certificate errors by Certificate Authorities (CAs) and to guard against cyber-criminals issuing their own certificates.

Stopping Misuse

The move has been designed to improve all-round transparency, and to better protect both users and companies from becoming victims of certificate misuse.

Triggers A Warning Message If Not Logged

The change means that all CAs must now log every digital certificate they issue in certificate transparency logs so that any website with a secure socket layer (SSL) or transport layer security (TLS) certificate that isn’t logged will trigger a browser warning. The warning will tell users the website’s certificate doesn’t comply with Google Chrome’s transparency policy, and therefore, may not be safe.

In fact, any part of a website that’s served over an https connection that doesn’t comply with Google’s policy will not load and will display an error in Chrome DevTools.

The change applies to all TLS server certificates issued after 30 April, 2018.

Driving Positive Change

With Google Chrome reportedly being used by 60% of web users, this move is being seen by some as Google using its market dominance to drive better practices. It is expected, therefore, that most other major browsers will follow Google’s example.

What Does This Mean For Your Business?

This is really just an industry change that primarily affects parties issuing the certificates e.g. a Certificate Authority. The change isn’t retroactive and so isn’t going to affect SSL certificates that were issued but not logged before April 30, 2018. This change will not (immediately) directly affect end users, although the clean-up effect that it may have on the whole business around certificates, and in thwarting some of the activities of cyber criminals could contribute towards a more secure internet generally. For example, cyber-criminals have been able to target internet users by finding ways to issue their own certificates.

The change should also give businesses a way to take action to protect themselves and their customers against any potential damage done to their business by mis-issuance of certificates.

This story should also be a reminder that from June, if your website doesn’t have a secure certificate i.e. if it doesn’t have https in the URL, Chrome will post a security warning to visitors which could mean that you lose enquiries and sales. Not having a secure certificate could also potentially mean that your website could suffer in the search engine rankings.

TSB Computer Meltdown – Problems Nearly 2 Weeks On

Posted on by Rob Burdett

Customers of TSB are reportedly still experiencing difficulties with internet and mobile banking services nearly 2 weeks after problems first began.

What Happened?

TSB, which was acquired by Spanish bank Sabadell in 2015, tried to fully migrate its computer systems from its old Lloyds Bank systems to its new core banking system, known as Proteo4UK. Proteo4UK is basically a version of Sabadell’s in-house core banking platform Proteo which has been designed for TSB.

The system had already been rolled out to staff in November 2017, and the full rollout to customers was also supposed to have happened in November but was put back until April to avoid potential confusion of the expected interest rate rise.

Why Migrate?

The expected benefits behind TSB’s decision to migrate were cost savings through not having to pay £160 million per year to Lloyds Bank for hosting, and the opportunity to be able to implement its own customer-facing systems offering digital banking services.

TSB had already launched a mobile app for Android and iOS devices to enable customers to use banking services via the new system in a convenient way, and was in the process of offering iPhone X users the opportunity to use their faces as identification.

Meltdown

Unfortunately for 1.9 million TSB customers, the bank staff, and TSB’s reputation, the migration did not go to plan and resulted in what some commentators have described as a ‘meltdown’ of its banking systems.

Some of the problems experienced by customers have included not being able to access their own money, no access to any mobile and online services, problems with direct debits, and amounts of money appearing and disappearing. It was even reported that one customer was mistakenly credited with £13,000. TSB has also been deluged, understandably, with complaints, with TSB staff facing hostility, and the reputation of the bank taking a battering in the media.

Response

Several apologies later, and even though TSB’s CEO Paul Pester announced in BBC Radio 4 interview that he would take direct control from the banks’ platform, and that he’d drafted in a team of global experts from IBM, and although the mobile app is now reportedly fixed, some customers are still reported to be experiencing problems. Some have appeared in tv news reports telling of their experiences and of their fears that important bills may not have been paid as a result of the system’s problems.

Treasury Committee Wants Answers

Executives from TSB and parent company Sabadell have been asked to appear before MPs to respond to questions and give evidence to the Treasury Select Committee on Wednesday 2nd May over the ongoing IT system outage.

What Does This Mean For Your Business?

It is well known that many banks run on old systems which have led to glitches in the past i.e. customers not being able to access their money, and have been the cause of worries about security. The case of TSB illustrates how the company had good commercial intentions as a challenger bank in migrating its systems to reduce costs and meet the modern customer’s digital expectations, but ended up creating a PR disaster for itself. It is thought that the problems could cost the bank millions in lost customers, compensation, and damage to the brand.

Some commentators have criticised the bank for mismanaging the migration and for focusing too much on creating fancy apps rather than focusing on just getting the migration to happen as smoothly as possible.

It has also been suggested that, if joining or switching to a new bank, customers could do worse than to ask their proposed new bank what their plans are in terms of core banking platforms, whether they have any major IT projects planned, and how up to date is the core banking system is.

The problems with TSB’s banking systems will undoubtedly have impacted many businesses as customers were unable to access funds or to spend as they normally would, or to pay existing agreements, and this all adds up to extra costs, reduced profits, and stress for business owners.

This story is also a reminder to businesses that unforeseen and potentially costly IT problems can happen, particularly with cyber-crime activity, and that having a good Business Continuity Plan and Disaster Recovery Plan is important.

Tech Tip – Checking Your Facebook Connected Apps

Posted on by Rob Burdett

In the light of the Facebook and Cambridge Analytica scandal where a quiz app was used to share personal details without the consent of users, you can take action boost your own security by checking what connected Facebook Apps you have. Here’s how:

– Log into Facebook.
– Pull down the toggle/arrow at the right top of the Facebook screen to reach the account details.
– Choose ‘Settings’ from the list.
– On the General Account Settings page, scroll down and select ‘Apps and Websites’ in the left-hand menu.
– The next page shows the Facebook applications that have been given account access, e.g. fun apps, and productivity apps (e.g. Hootsuite)
– If you’re not happy about a particular connected app having access, you can remove the app entirely by checking the box to the right and selecting ‘Remove’.
– If you select one or more apps and click remove, another dialog box will be shown with an additional checkbox option referring to previous activity e.g. prior posts made using the app.
– Once removed, an app or website will no longer have access to your information, yet they may still retain previously shared information.