The advertising industry post (prompted by WPP’s 2017 financial results)

Sometimes the most straightforward posts take the longest to write. When I started on this one last week the big question in the minds of people who watch the big advertising conglomerates is are WPP numbers a company problem or an industry problem?

Fortune Global Forum 2013

WPP is looking to simplify its structure with a view to becoming a more agile and transparent business from a client perspective.

Or as it was put in the New York Times

WPP plans to accelerate a programme to simplify the business by aligning digital systems, platforms and capabilities to provide bespoke teams for its clients as opposed to the different agencies that currently compete with each other to win contracts.

Other conglomerates, notably Publicis had already started on this path when it started realigning the group under the ‘Power of One’ vision. WPP is bigger with a fuller offering and wider range of specialisms than many of its peers, no one can be under the illusion about the size of this undertaking.

Let’s talk about the tectonic plates shifting around beneath the feet of ALL  the large advertising and marketing combines:

  • Interpublic Group (IPG)
  • Omnicom
  • Havas
  • Publicis
  • WPP
  • Dentsu

The tectonic plates are:

  • The Four
  • Amazon
  • The decline of brand marketing
  • The new competition
The Four

The Four is a label that Professor Scott Galloway put on Apple, Amazon, Google and Facebook. All of whom he considered to be monopolists that created value for their shareholders by putting the ‘real world economy through a shredder.

In this case I would swap out Amazon and Apple for Alibaba and Tencent, but the allusion to a quartet of horsemen portending a digital apocalypse is a useful allegory for the advertising and marketing sector.  Amazon deserves a section of its own later.

Galloway’s predictions of their destructive power led to an accurate prediction of WPP’s share price tumble this week. (see the video below)

Correlation does not prove causality however — it doesn’t mean that he got the right numbers for the right reasons.

Depending whom you believe Facebook and Google are responsible for 90 percent of online advertising growth outside of China. This represents a massive concentration of media power. It has implications for the creative and planning functions of an agency. Google and Facebook also run much of the advertising technology that purchase are made on. This has decimated much of the advertising technology sector and made it harder to differentiate media planning and buying based on the technology stack.

1707 - ad industry

L2 came up with this research last year based on Google and Facebook revenue targets. If they hit their numbers they would be treating around 14,193 jobs. But it would mean that the corresponding projected number of jobs lost in the advertising industry would be roughly the equivalent of every man and woman around the world employed at vehicle maker Nissan. And that’s just 2017.

L2’s calculations don’t take into account China where the advertising industry has been digitising at a much faster rate than in the west with the bulk of growth going to companies controlled by Tencent or Alibaba.

Given that most of the agencies within WPP and its peers operate on a billable hour model; this represents a considerable potential loss of value. Since the number of people directly equates to revenue.

The consolidation of online media also means that many clients will look to take back control of their media planning and buying process. The argument goes something along the lines of ‘a consolidated media landscape allows for consolidated buying by a global media trading desk due to the inherent simplicity in suppliers. The data comes from the inhouse data management platform and the media vendor (Facebook, Google, Tencent or Alibaba)‘.

The always on creative needed to fuel this process is also being increasing done in inhouse studios, in partnership with their creative agencies as a kind of hybrid model.

This is what Marc Pritchard meant when he talked about taking back control of Procter & Gamble’s marketing as part of a process to save $1.2bn by 2021.  In the latest financial results, WPP claimed that their media buying margins had not suffered – only creative had.


At the time of written Jeff Bezos is worth about 112 billion dollars, or just under double the annual defence budget of the UK for 2018. Amazon impacts the advertising and marketing industry in multiple ways.

It is starting to become a big player in online advertising in its own right. I think it would be fair to say that this competition to Google is welcome for the marketing conglomerates judging by Sir Martin Sorrell’s commentary on the likes of CNBC.

Amazon has decimated the high street. Toys R Us, Borders Group, Tower Records, Radio Shack, Maplins are just some of the names which have disappeared. It took a good number of years for people to realise that retailers are locked in a zero sum game when Amazon competes against them. Amazon has unique access to exceptionally cheap capital via its shareholders. There have been companies who have beaten it back like Alibaba’s Taobao and TMall in China. But the company has built up a huge amount of retail power and decimated brands that would have been advertising agency clients.

Amazon has become the default search engine for buying things. This has already displaced up to 20 percent of Google searches depending on whom you believe. It also means that they can place imitation goods and private label goods against branded products.

Amazon has got great data. Amazon has data at the centre of its business what consumers like, what they don’t like, what sells well on marketplace resellers. This has driven a number of the product decisions:

  • Increasing customer basket sizes
  • Expanding into new areas by screwing over marketplace resellers
  • Focusing their efforts on private label products which directly impacts branded products across categories. Amazon Basics is the most obvious private label to consumers, but there are many more where the link isn’t so obvious

Depending on your brand category the answer may be:

  • Owning your own retail chain like Apple or LVMH’s DFS Group
  • Direct sales and subscription services have piqued the interest of FMCG brands like Dollar Shave Club

All of this impacts the advertising sector. For more information on the power of Amazon, I can recommend Scott Galloway’s The Four.

The decline of brand marketing

The relative decline of brand marketing has been driven by a number of factors, some of these factors are good and some aren’t.

Let’s talk about the good reasons first of all.

  • ‘Performance marketing’ driving customers directly to a sale has been transformed by the rise of modern online advertising techniques including search advertising and retargeting. Retailers can zero in on intent to a much greater degree than shopping television or direct response print adverts ever could. Google and social media have turned into reputation platforms which then displayed below-the-line spend from the likes of public relations agencies. This was happening at a time when journalist employed by publications have declined; implying a natural progression
  • At least some consumers can’t be reached through traditional media channels with sufficient frequency for brand advertising. Social media, online video and banner ads make sense as part of an omnichannel approach

The bad reasons:

  • The focus on ROI rather than profits has meant that a balance longer term brand building and shorter term sales has fallen out of kilter. Marketing then becomes a reductive process. To use a farming analogy; its like moving from arable farming with crop rotation to slash and burn. This is particularly noticeable in the way private equity management has affected fast moving consumer brands under its control. Zero-based budgeting is seen as a source of cost cutting rather than ensuring the efficient and effective use of marketing resources
  • Digital first strategies – for many marketers this has meant a move from media-neutral, let the communications problem define the channels used to a digital dogma. I make my living with digital media, but I recognise the flexibility required in thinking to deliver an effective strategy

It isn’t about one approach over another but finding balance that works for sales now and in the future.

The new competition

The rise of digital advertising has seen business services expand ways that we couldn’t predict. Advertising agencies like Ogilvy understood the potential for digital early on. Consultancies were focused on systems integration and the use of technologies to change business functions. As they became interconnected internally and externally; the progression into marketing made sense.

A reduction in creative budgets caused marketing agencies to move into areas like service design. Consultancies have looked to inject creativity into their values and skills set by mirroring the kind of acquisition strategy that built the marketing conglomerates.

In the meantime technology companies, notably Adobe have treated marketing like any other business function with a sale conducted at the c-suite level just like Oracle or similar. In many respects this move is understandable as companies use a data management platform (DMP) to derive audience insights and improve their digital marketing. This isn’t vastly different from historic data warehousing and data mining applications.

The enterprise software companies allow large companies to do internally what they have previously asked media agencies to do.

More information

WPP raises spectre of adland stagnation – Breakingviews (paywall)
WPP Vows to Do Better After Weak Results, Nervous Outlook Send Shares Plunging – The New York Times (paywall)
I Cannes – L2 Research
P&G brand chief vows to ‘take back control’ from agencies | FT (paywall)
Sorrell admits creative is hurting more than media as WPP shares plunge | CampaignLive (paywall)
Amazon is threatening Google’s ad space monopoly, Martin Sorrell says | CNBC

Black flag operation Facebook advertising?

In the wake of Brexit and the election of Donald Trump there is an increased focus on Facebook advertising. I would have thought that the one I was served the other day would have been the equivalent of a three-alarm fire for the advertising team?

Black flag advertising

I didn’t have the presence of mind to look at why I was targeted, my priority was to take a screen shot.

Oprah time: The Four: The Hidden DNA of Amazon, Apple, Facebook and Google by Scott Galloway

Galloway is known as the founder of L2 and as a perceptive commentator on the digital economy (well as perceptive as anyone is with a bank of researchers behind them). He admits freely in his book that his fame was due to years of effort, advertising spend, researchers, script writers, video editors and studio time.

The Four

The Four is Scott Galloway channelling Malcolm Gladwell; explaining for the average man:

  • How Google, Facebook, Amazon and Apple make their money?
  • How the digital economy is affecting the overall economy?
  • What are the negative aspects of their effect on the digital economy?

Galloway does a really good job of surfing the media and policy wonk groundswell against Google, Facebook, Amazon and Apple.

As a digital marketer the book won’t tell you won’t know already know.  I found it a bit disappointing given the role that Galloway and L2 play in the industry.  Secondly, Galloway has already covered all the territory repeatedly in his media appearances and opinion editorials over the past year. He has left little unsaid that would be considered an exclusive for the book

As a digital marketer, if you want your family and loved ones to understand what you do for the living and the major issues that are shaping your job Galloway’s book is a good option.

Mercedes’ China Syndrome

China Syndrome definition: a hypothetical sequence of events following the meltdown of a nuclear reactor, in which the core melts through its containment structure and deep into the earth. A term the American’s used to imply an accident so bad that hot nuclear material burnt through the centre of the earth and out the other side (to China). It seemed an appropriate metaphor of Mercedes recent marketing debacle.

A seemingly shallow innocuous social media post by Mercedes Benz managed to stir the passions of Chinese netizens. Many of whom broke Chinese law to jump the great firewall to complain on Instagram. A corporate meltdown ensued.

mercedes benz

When one looks at it from a brand marketing point-of-view two questions immediately pop up?

  1. Why were Mercedes doing filler motivational quotes in the first place?
  2. What does Chinese exceptionalism mean for brand marketers around the world?

Motivational quotes

Motivational quotes a tried and trusted tactic for social media marketers. But that doesn’t mean that they are any good. It really depends on what job the post is supposed to fill.

I can’t imagine that it would have driven a lot of sharing (controversy nonwithstanding) or greatly expanded the reach of the Mercedes Instagram account.

Motivational posts can performs really well if you are measured on engagement particularly in markets like the Philippines,Myanmar and Thailand. In the case of Myanmar, brand content serves as entertainment due to an under-developed media industry. Again I don’t know why the team would have been focusing on markets like this?

Where they looking to tap a wider audience and position Mercedes as a brand that one would aspire to own? In developing markets where the urban middle class drive Toyota its a possibility if they were focusing on Mercedes as a luxury brand (S-class, SL-class, GT, GLS and G-class models certainly are).

However those posts would be less likely to appeal to serious car buyers or petrol heads. Mercedes has a rich heritage in car-making and motorsport that it could have drawn upon instead.

I imagine the problem comes down to the way goals were set for the Instagram account. They may have been lacking a clear view of who they wanted their audience to be. I don’t have any insider insight so that’s about the best that I offer.

The Dalai Lama is a divisive figure. The Chinese view him as a ‘separatist’; whilst in the west he is respected as a religious leader and he comes across as an affable old man in media interviews. They view Tibet as an indivisible part of China.

The quote was published within a day of American motor manufacturer Dodge being criticised for using the words of Martin Luther King in an advert. A curious social media operative should have looked at the Dodge debacle and thought ‘what does this mean for my brand’? It doesn’t seem to have occurred and that is on the social media team involved.

Some times it is worthwhile going back to basics:

  • Treat others like you would like to be treated yourself
  • Don’t discuss politics or religion in polite conversation
  • Put three times as much effort into listening, as you do speaking

Chinese exceptionalism

China is an ascendancy, in the same way that a post war-era US saw the rise of US influence around the world. President Xi  echoes Chairman Mao’s China has stood up quote. His power hinges on two things:

  • The legitimacy of the party which is deeply linked to its ability lift Chinese people out of poverty.  From the Deng era onwards China has lifted over 650 million people out of poverty. It’s essentially the Chinese Dream. The ongoing crackdown on corruption in the party is linked to the legitimacy of the Chinese Dream: do what we ask and things will continue to get better in a step-wise manner. You maybe poor at the moment, but your life will continue to improve
  • Chinese nationalism: China going back out and taking its place on the world stage. Prior to the mass production of the industrial revolution; China accounted for roughly one third of the world’s total economic output. It slipped back as the industrial revolution took place in the west. Its current economic growth is seen by the party as China’s journey to regain its place

This means that a constituency of the Chinese population and the party is extremely sensitive to perceived slights, whether they were intentional or not. Chinese sensitivity to the world accelerated since 1999 when the US air force managed to bomb the Chinese embassy in Belgrade by accident.

I don’t think anyone believes that the Mercedes social media team thought about ways that they could offend the Chinese people – on a platform that is unavailable in China. It was negligence rather than malicious in nature.


February 5: Mercedes posts a filler motivational post on Instagram with a quote from the Dalai Lama.

Despite Instagram being blocked in China, Chinese netizens became enraged about the post.

February 6: Mercedes apologises on its Weibo account. Chinese netizens are still angry and want the apology to also run on Instagram. Mercedes is between a rock-and-a-hard place. Pissed off Chinese netizens, or pissed off netizens from the rest of the world

February 7:  A Chinese government spokesperson comments on the apology, with a statement that said in diplomatic language that it was prepared to get medieval on Mercedes Benz if necessary

February 7: Senior management in Germany send a letter of apology to the Chinese ambassador in Germany.

February 8: Second apology is reported on Xinhua. Xinhua is the Chinese government’s wire service think AFP or Reuters.

February 9: People’s Daily – a government newspaper often considered a herald for the Party describes Mercedes as an ‘enemy of the Chinese people’

February 13: Mercedes-Benz (China) Automotive Sales Co. will recall 1,886 imported S-class, C-class and GLC sport utility vehicles (SUVs) manufactured between July 2016 and December 2016, according to the statement. Its joint venture company Beijing Benz Automotive Co. will recall 18,893 C-class and GLC SUVs manufactured between October 2016 and February 2017. These recalls don’t seem to be mirrored in other countries, which is unusual for the 1,886 imported models – it might be a coincidence…

The constituency

The main critics of Mercedes seem to be particular faction of it young people with extreme nationalist tendencies called 愤青 fenqing (said fen-ching).

They are a diverse group in terms of beliefs, but a simple view would be to think of the nationalism of Britain First supporters, but with Chinese sensibilities. They tend to come from lower tier cities and will have been less exposed to world beyond China.

Their antics are curbed through censorship and further actions when it suits the Chinese government. It is rarely desirable to allow the fenqing enough space to run unchecked.

When China was unhappy with South Korea; it chose not to curb protests and damage against Korean business Lotte by fenqing. Lotte owns the golf course on which the THAAD anti-ballastic missile system was placed to stop a North Korean nuclear attack on the South.  Chinese demonstrators closed Lotte stores throughout China, cause a huge amount of damage and forced Lotte to withdraw completely from the Chinese market. Those stores that weren’t picketed by protesters were closed down by Chinese local government department for (non-existent) fire code violations and fined over breached in advertising regulations. Chinese tourists boycotted Korea and Korean stores.

They will have been supplemented by students living outside China whilst attending foreign universities.


One has to consider Mercedes faux pas in context. It came on the back of apologies by Delta Airlines, Zara and Marriott Hotels when netizens realised that Taiwan and Hong Kong were treated as different countries on these websites.

In Marriott’s case it was an loyalty programme research survey that caused the controversy.

Posts like this one on Instagram have the comments section stuffed full of protests from overseas Chinese and their mainland brethren who have jumped the great firewall.

The government forced Marriott to close its site and app in China. In addition Marriott’s social channel went dark AND the company made an apology aimed at a global audience.

Their western social channels went dark for four days to a week depending on the channel. The implication in an article in China Daily the Chinese government ordered a shutdown GLOBALLY on Marriott’s social channels as part of the punishment.

“To regain confidence and trust, the first thing is to admit the mistake, then fix it, and it would come back slowly as we prove we really mean what we say,” Smith told China Daily in Shanghai on Wednesday, one day before the company’s digital platforms are scheduled to be back online.

What is conveniently forgotten is that the international websites of Chinese state-owned companies like Air China made similar mistakes.

Why did Mercedes apologise?

Chinese netizens weren’t going anywhere. They are angry and persistent.

Implicit government pressure, here is a quote from a Chinese government press conference about it

Q: According to reports, on Monday, Mercedes-Benz quoted the Dalai Lama in an English language post on Instagram. Yesterday, the company apologized and deleted the post. Was this at the behest of the Chinese authorities?

A: I have seen relevant reports. To acknowledge your wrong and fix it is the simplest truth, universally accepted both in China and in other countries.

I want to stress that over the forty-year course of reform and opening-up, the all-around cooperation between China and foreign enterprises has not only boosted China’s development, but also benefited the latter. As the 19th CPC Congress ushered in a new era for China’s endeavors in various causes, a China in the new era will be more open and more confident. We will continue to pursue cooperation with foreign companies, and we are also ready to share China’s development opportunities with them. However, it is needless to say that they must observe some basic rules.

That’s diplomatic language for expect a beasting from the Chinese government and Chinese people for any perceived slights.

Mercedes-Benz probably looked around at what its peers with major exposure to the Chinese market have done. Marriott being the most obvious analogue. Marriott’s capitulation to the Chinese government was complete and global – even at the risk of provoking the ire of Donald Trump supporting Americans. They were one Donald Trump tweet away from American First outrage over their capitulation to China, but it was a risk that they were prepared to take.

It is worthwhile remembering that Boeing had a billion dollars wiped off its market value thanks to Donald Trump complaining on Twitter about the price of a new Air Force One plane. He has also shown an ability to mobilise his political base via social media.


The takeaway for many brand marketers in multinational firms, regardless of where in the world that they work is that they are the Chinese government’s pawn and they best get used to it. Chinese buying power has given the Chinese government the kind of exceptionalism that was previously only available to the US; then mostly because that was were many multinational companies were headquartered.

One has to wonder how long western brands will survive by bending to the will of the Chinese government when it wants its homegrown brands to expand globally?

Contrast Marriott and Mercedes’ behaviour with the rage-filled tone Huawei takes, particularly  in the US in the face of government criticism or negative partner actions.

More information
Use of Martin Luther King Jr. speech in advertisement causes controversy at Super Bowl | The Independent
China inflicted a world of pain on South Korea in 2017 | Quartz
China asked Marriott to shut down its website. The company complied | Washington Post
Statement from Arne Sorenson, President and CEO, Marriott International, Inc.
Marriott announces ‘rectification plan’ to regain trust | China Daily
Doing business in China: Politics is still in command | HKEJ Insight
Foreign Ministry Spokesperson Geng Shuang’s Regular Press Conference on February 7, 2018 – Chinese Ministry of Foreign Affairs
Daimler apologizes to China for quoting Dalai Lama | Xinhua News
Mercedes-Benz to recall 20,779 cars in China | Xinhua
Donald Trump just took a shot at Boeing in Trump Tower | CNBC
Huawei fed up, tells US critics ‘shut up’ | ZDNet
The CEO of Huawei Totally Went Off Script at CES and Ripped U.S. Carriers After an AT&T Deal Fell Apart | Entrepreneur

Social networks 10 years ago | 社交网络服务10年前 | 소셜 네트워크 서비스 10 년 전

Ten years ago, I was busy helping get a communications agency’s digital offering up and running. Social media was a thing. There was a mix of curiosity and fear in clients. A bit like the web before it, they felt that they needed to do something but often didn’t have sufficient momentum to turn this into action.

Now social media means Facebook/Instagram/Twitter/Snapchat and maybe LinkedIn depending on the client objectives. Back then it was much more diverse. Blogging was still powerful and I spent a lot of 2005 – 2007 helping Yahoo! and then agency clients develop social media and blogging guidelines.

The first panel that I ever spoke at was an event called Blogging4Business held at  the Marriott in Grosvenor Square in April 2007.

It was a time of tremendous growth. Facebook had gone from 28 million users in July 2007 (less than half the size of MySpace) to 200 million users by November 2008. MySpace doubled its user base in the same time but was still left in the dust by Facebook.

Here’s the top social platforms by unique worldwide visitors in November 2008 according to comScore.


Blogger – remember I said that blogging was big? Pyra Labs had launched one of the first dedicated blog publishing tools in 1999. By February 2003, it was acquired by Google. The second iteration of this blog was started on Blogger in March 2004. Blogger’s killer app was that it was much more flexible and scalable than DIY sites like Geocities and Tripod that came before it.  It developed a number of great features added around this time including allowing me to post via email. You’ve got to remember, network access was pretty poor outside the home.

Email was one of the few things that worked well on mobile devices. I started using Flickr as my image hosting which allowed me to send image attachments as well as my copy to my blog. An email could be written on the go, without internet connectivity. The next time that you connect to the internet, the email would sail into the ether and trigger a blog post, which was much more practical than the nascent app economy on PalmOS and Symbian at the time. I sent an email to publish this post using a Palm Treo 650, whilst waiting to fly back from San Francisco airport in August 2005. At the time I was going back and forth between Yahoo! Europe in London and global headquarters in Sunnyvale.

Blogger attracted 222 million unique users on a monthly basis.

Facebook – we all know it now as a dominant ever watchful social leviathan. Culturally Facebook represented a changing of the guard. Up until 2007, web 2.0 ethos had been about data portability. It meant I could easily move my photos from Flickr or my bookmarks from Part of this came from the hippy ethos that was baked into the Silicon Valley world view. Here’s what I was saying about Facebook back in 2008:

I don’t work with Facebook, I can only go on the way that the company presents itself and judge it on its actions. But from this I can make some deductions. Its terms and conditions particularly the ownership of any user data is much more onerous than the likes of Google and Yahoo!. With Yahoo! you grant them a non-exclusive license to your content; you can choose to remove the material when you want. With Facebook, they own your data period. This isn’t about putting their business on a legal footing but serving the audience up with a price on their head, and showing a lack of respect for their audience. And I haven’t even talked about Facebook’s privacy infringing marketing practices, of which Beacon was the latest high-profile example. As the saying goes ‘A fool knows the price of everything and the value of nothing’.

The company takes a Hotel California approach to APIs (your data can enter, but it can never leave). Add to this the control that Facebook is going to put on developers in 2008 – not exactly right neighbourly now is it? Even Apple bows to their influence and had to give developers an SDK (software development kit) for the iPhone. Also remember that developers are the kind of web influencers who can make and break a service: they lead people on and they can lead people elsewhere.

By 2008, Facebook was getting its ducks in a row to become an online advertising powerhouse. What we couldn’t see at the time was the way that Facebook missed the boat on mobile and had to consciously work to not fall off the wagon. Back in November 2008, Facebook had 200 million followers.

Facebook was defined in many respects by its rival MySpace. by 2008 they had been rivals over three years. 2008 marked the turning point when Facebook gained the upper hand and surged away. The roots of MySpace was in a digital marketing company eUniverse who had employees with accounts on the Friendster social network.

They decided that they could do a better social network. Friendster had struggled to scale and many times you couldn’t log in. So the bar was set pretty low. Being based in Los Angeles, MySpace used entertainment connections to have bands and celebrities as ‘tent pole’ users on the platform. Digital promotion was really taking off in the music industry so their timing was fortuitous. MySpace was also instrumental in the rise of freemium casual gaming. This drove one of the first booms on the Facebook platform: remember Farmville? And opened the door to freemium mobile game apps like Angry Birds and Candy Crush. A sale to News Corporation saw MySpace take your eye off the ball. In November 2008 MySpace had 126 million unique users, by 2015 MySpace had almost 1 billion active (and inactive) accounts.

WordPress – sprang out of Matt Mullenweg’s open source blogging platform project. offered a half way house between Blogger and having a self-hosted website. It has an annual subscription to contribute towards hosting and a better experience than Blogger. In November 2008 attracted 114 million unique users, claims that this number has now grown to 409 million unique users per month.

Windows Live Spaces was a weird chimera of a blogging platform, photo gallery, a Geocities style guest book and a social platform. You have a pretty good idea from just reading this how much of a mess it was in terms of its user experience. Facebook was pretty awful; Live Spaces made it look reasonably good. It didn’t help that it was originally launched as MSN Spaces back in 2004 and got caught up in the wider online rebrand that Microsoft did in 2006. In November 2008 it was attracting 87 million users per month (presumably due to integration between the Microsoft browser and Windows Live services). Microsoft shut it down in 2011.

Yahoo! Geocities was a pensioner in web service terms by 2008. Geocities was originally launched in 1994, it offered people like you and me the opportunity to create our own web pages with no technical skill. If you became a paid user you could increase the size of your website and get telephone technical support. People would build pages to share holiday or baby pictures in low resolution.


When I was in college, Geocities was useful as other students would publish essays and book reports online, that I could then reference. This was back when you could surf the web or discover content by following a webring. A webring was a pre-Google way of discovering quality subject content once you had landed on a relevant site. As the name implied a webring is a collection of (amateur) websites (usually around a common subject area) linked together in a circular structure. By 2008, Geocities was on its last legs but still drew in 69 million unique users. It was shut down in the US the following year. Geocities still lives on in Japan.

Flickr – I started using Flickr at the end of 2004, it allowed you to have a visual diary a la Instagram. In addition, it provides flexible image hosting. It still does the image hosting for this blog today and allows great searching through the use of labels and tags. Flickr drove access to creative commons visual content. There is a whole novels worth of material about how Yahoo! mismanaged the business and missed opportunities.

When I left Yahoo! in 2006, one of the last things that I worked on was the default installation of flickr on the Nokia N73 camera phone four and a half years before Instagram was even launched. Instagram is basically a less flexible, less community minded Flickr with filters that allowed millennials to convince themselves that their poorly taken snaps was art – a digital version of Polaroid or Lomography. In November 2008, the strain of being inside Yahoo! was starting to show, the founders had resigned in June 2008; but flickr welcomed 64 million unique users. Flickr turned 14 years old on February 10.

The first photograph that I took and posted on flickr for the Pirate Communications Christmas party. This happened right after we’d lost a large part of the BT business, which was the agency’s anchor client at the time.

Pirate Christmas party part one

hi5 – back at the beginning of 2007 there was some data that suggested the user growth at social network hi5 would put it ahead of MySpace, I can remember marketers getting excited about it for about six weeks. By November 2008, it had lost a lot of steam and Facebook tore ahead. hi5 still had a respectable 58 million unique users. hi5 was one of a number of social networks that seemed to be adopted in loyal pockets in developing countries.  The network pivoted into social games to try and ride the casual gaming boom and did some interesting work around game software development kits for the platform.

Orkut – is a classic tale of opportunity squandered. Orkut was ‘inspired’ by extranet group software called InCircle. Back in 2004 it looked like a dead cert. A Google backed social network that had been developed during an engineers 20 per cent time. At this time:

  • Silicon Valley was seen as making a positive difference
  • The internet was still largely idealistic
  • Google could do no wrong. They didn’t need to ‘do’ PR, the positive stories wrote themselves such as ‘Google spots Jesus in Peruvian sand dune‘ and the general media would be absorbed with every Google Doodle

There was no apparent reason why their venture into the social networking space shouldn’t do well. It featured integration of (at the time) great services including GTalk instant messaging and both YouTube and Google Video.  Orkut became a a community of over 300 million registered users.  The problem was that Orkut only took off in very localised areas, if you weren’t a Google employee, Brazilian or Indian you likely won’t have been an active Orkut user for long and this stymied its growth. I suspect that the reason for this was that the initial community was grown on the back of Google’s engineering base. There were groups of users in the Persian gulf states and Saudi Arabia but access was blocked due to groups like ‘Dubai Sex’.

Orkut had numerous security issues in 2006 and 2007. Profiles became infected with the MW.Orc worm which stole users banking details, user names and passwords. A second less malicious worm automatically made a user join a virus related community and then replicated itself on the users profile to spread further. Finally there were session management and authentication issues that posed particular risks for those people using cyber cafes. They allowed access to a users Gmail account. After ten years Google finally pulled the plug on Orkut. In November 2008 Orkut had 46 million unique users.

Six Apart – had it all. Photogenic husband and wife founders, great technology and bold business moves. Six Apart created Moveable Type which at one time was the go to blogging platform. They also  founded TypePad which was a analogue. Vox launched in 2006 was a simpler blogging experience – Tumblr was a good analogue. They bought French platform Blog and Loic Le Meur became their head of EMEA. Around the same time they bought LiveJournal. Vox was eventually closed down, but LiveJournal was sold for a profit. At the time, the smart money would have been on Six Apart to win over, in the end it turned out rather differently. Back in November 2008, Six Apart websites enjoyed 46 million unique users.

Baidu Space – Baidu Space was a social network that grew out of the search engine company.  It launched in 2006 and over 18 months it managed to grow to getting 40 million unique users by November 2008. It was closed in 2015 and all the content was transferred to Baidu Cloud file storage service.

Friendster – prior to its sale in 2009 Friendster had managed to clock up 115 million registered users, which was a minor miracle given how unstable it was and was virtually impossible to log into over a two year period. On a good day it was like using a website though a sluggish Citrix window. Twitter used to have a reputation for poor infrastructure which made the ‘fail whale’ iconic, but that was nothing on Friendster’s instrastructure.  They knew what they had to do , but due to management issues and technology issues couldn’t make it happen. It seems like a miracle that in November 2008 the site had 31 million unique users. Mark Zuckerberg is obscenely rich because Friendster was very unlucky. – was owned by Chinese internet company Sohu at the time. It was one of the most popular video sharing sites. This was back before Tencent came to dominate the video market alongside Tudou | Youku. It lost a good deal of its traction when it was shut down for over a month in June 2008. By November 2008 it had 29 million unique users per month. was sold to youth orientated social network Renren at the end of 2014. – is now owned by Vista Print and is surprisingly still going. It was launched in 2001 and was a step up from Tripod, Geocities and Angelfire in terms of allowing you to build and host web pages.  In November 2008 it attracted 24 million unique users. This was on the back fo massive growth from 2003 to 2007. It has now been overshadowed by Squarespace and WordPress.

Bebo was founded at the beginning of 2005. The founders(Michel and Xochi Birch) managed to built a user base amongst teens in the UK and Ireland before selling it on to Aol in March 2008 for $850 million. The Birch’s sold at the top of the market. Aol managed to sell on Bebo, but at a large loss. Eventually it went into bankruptcy administration. It is now a Windows programme that streams to Twitch. In November 2008 is had  24 million unique users.

Scribd – it is optimistic to call Scribed a social service but that’s the category that comScore listed it in. It was launched in 2007 and by November 2008 it had 23 million users. Over the years it has evolved into a subscription service for books, comics and audio books.

Lycos Tripod – Tripod was a rival of Geocities, that has evolved into a small business hosting business similar to Square Space. It was launched in 1995 focusing on college age students and was acquired by Lycos in early 1998. By November 2008 it enjoyed 23 million unique users. That didn’t start the European arm of Tripod being closed down in 2009.

Tagged – Tagged is the cockroach of social networks. It isn’t amazingly successful but is durable. In marketing circles they were known for their deceptive email marketing practices. Tagged users had email contacts taken from their address book and contacted. It resulted in a class action law suit that was settled in 2010. They seem to be still going as a social network site. In November 2008, Tagged had 22 million unique users.

imeem – was a hybrid of Spotify, Vevo and Launching in 2005, it allowed had an advertising supported free music model. You could share music, stream tracks and playlists. It also provide widgets that you could embed on a website, Facebook or MySpace profile showing your favourite tracks. They were notable for being able to get licences from all the major US music labels for free streaming on the web.  The economics of it didn’t work, whilst it had 22 million unique users in November 2008, it was sold a year later in a fire sale by MySpace Music.

imeem were smart enough to have good mobile apps on iOS and Android right from the beginning. They allowed the purchase of DRM-free MP3s, which was a pioneering concept at the time.

Netlog – was a Belgian based social network aimed at a youth market. It was founded in 1999, but didn’t really start to take off until 2002. In 2005, they started expand beyond Europe. There were a couple of things notable about it:

  • You could send invitations to friends via Facebook, though the user experience was a bit of a mess
  • They geo-targeted and age-targeted content to users so you would only see content from people in the same region and age group as you

Registered users peaked at 94 million in November 2008 it saw 21 million unique users.

Honorable mentions

Cyworld – Korea had a unique web eco-system. Part of the reason for this was that the Korean government mandated a couple of security standards. Cryptographic links using Microsoft Active-X – I know, I know but they were at least thinking about security for sign-in and banking details, which is more than be said for most governments. Secondly Koreans needed to provide their national identity number. Part of this was due to the fact that Korea was a relatively new democracy with weaker free speech laws. Lets talk about the name ‘cy’ means between people in Korean, rather than alluding to cyber space.

Cyworld started in 1999 by a bunch of students who built the social networking site as an offshoot to discussions they were having about a research project. Most of the members abandoned it after graduation, but one of them became CEO at the end of the year.  It wasn’t particularly successful until a ground up redesign dubbed Minihomepy was rolled out in 2002. This pioneered virtual goods that pre-dates the stickers available on Asian OTT messaging services such as Mixi, KakaoTalk, LINE and WeChat.

Cyworld was bought by SK Telecom – a Korean fixed line and mobile carrier. SK had a distribution footprint including app space on their handsets, a popular online portal Nate and Korea’s most popular instant messaging client NateOn. Over 2003, Cyworld tripled in size from 2 million to 7 million users.


Cyworld peaked out in 2011 at 25 million users. It’s decline due to the rise of the smartphone. Kakao Story and KakaoTalk provided a superior experience on mobile devices and became ubiquitous in Korea with 55 million registered users (just about every man, woman and child in Korea). Facebook entered Korea in 2009, its progress in the country was slow, though it was useful for those Koreans who had international connections. A hacking attack which compromised the Cyworld and Nate user base precipitated a mass exodus from the platform in 2011. There is no evidence that Facebook was involved in the hack; but they did benefit from the fallout.

In November 2008 had 19 million users.