(by Preethi J & Nikhil Pahwa)
In final part of our three part interview with Orkut (read Part 1 and Part 2), we spoke to Google India’s Rahul Kulkarni (Product Manager) and Parminder Singh (Business Head) about the monetization of Orkut and its communities, branded communities, Adsense and click-throughs. While they were hesitant about share numbers (apart from ComScore, which we don’t endorse), or gaze into the future, we did get some interesting qualitative inputs in the interview series.
What are Orkuts plans for monetization?
Singh: Orkut has fairly strong momentum in terms of usage, in terms of people finding the product interesting, informative, and a useful medium of interaction, which is also reflected in the fact that advertisers are also understanding Social Media as a category, and particularly Orkut, since it is the largest website in India in terms of pageviews.
There are 3-4 ways that advertisers use Orkut: communities continue to be strong. There are unmoderated communities for a lot of brands, but now we see advertisers setting up their own communities. What we offer is to be able to communicate your message to people, using four criteria: the age profile, interest, gender or the city that they are in. There could be 3 things here: you could either give the user a message that is so relevant here through the profiling and targeting options that we have, that the user doesn’t mind coming out of that experience. Or you could give him an app on Orkut, or take him to a community.
We’ve seen all three working well, but it’s important to be a part of the context. Interestingly enough, financial services advertisers are able to establish their brand but also see conversions. A money remittance site is able to use Orkut’s presence in the US and Australia. A company in India has been successful in terms of converting loans on Orkut.
How are brands & communities doing on Orkut?
Kulkarni: Brands no longer just slap a bunch of ads and measure eyeballs but are looking for loyal users and doing something specific on Orkut. MTV has a community and an open social app. The level of brand engagement with this is 100x-1000x of what you’d get with a display ad. Cadbury’s app on Orkut on ‘meetha-bombs’ resonated with its TV ad. On a social network, you want to interact with your friends, not guided to a third party website or a lead generation form for a washing machine.
The amount of effort and cost taken to conceptualize and build a community and an application is significantly higher than a display ad. Are we in a situation where Social Media is a part of a media planners plan?
Singh: You’re right – it needs a separate kind of thinking. It’s more of an intellectual investment than monetary investment. We give advertisers a five pillar framework: IFPFB. First is information – features of a digital camera, pro and cons of a loan. Others are Fun, Pride, Feedback and Bonding. As long as brands are tugging using all or some of them in combination, you’ll have the makings of a successful community.
How much of a hardsell is it to get Media Planners to put in the money?
Kulkarni: I’ve seen a decent number of brands realize the importance and invest in it. The good news is that the initial startup is the hard part – the bootstrapping. Once you lay this process together, it is an easy thing to manage beyond that. You need a strong insight on the social network to start with. Then you put an end point, with the right moderator, the right analytics, and the right kind of things that you as a person share on Orkut. There’s a guy who is writing the sequel of his novel on Orkut. How does a single person leverage this? He doesn’t have the power and money to spend on a brand marketing campaign, but he creates a community asking people to help him write the sequel to my novel…
Kulkarni: That’s there…as long as there is interaction, that’s what we care about. If users are engaging in a useful way, power to them. But we do see that brands get a lot more by engaging with ads in addition because with a community you get interested people to converge but how do you get the word out to others? We have seen successful campaigns where more new users are exposed to it. Returns are in the number of users that used the app daily – a concrete metric for brands that can redefine the way we look at display ads today – from eyeballs to clicks and actual interactions with brands that advertisers can bet on and then spend more online.
Singh: This is the Internet – look at the Google search page. There are brands on natural search, where we don’t charge for it, and then there’s advertising on the right. Most mature advertisers know it is important to be on top of both.
Users don’t come to social networks with the same intent, as in case of search…
Singh: The users are looking for an experience, and you have to be a part of the experience. As long as you are a part of the context.
Kulkarni: You’ve nailed it right. Marketing on social networks isn’t just about putting up apps. It needs a little more holistic thought. The fallout of that if you do it right, the returns are phenomenal. Just give a search for any brand on Orkut. The other day we were giving a search for Cafe Coffee Day, and every Cafe Coffee in every part of India has a community, with 500-3000-5000 member communities. Some communities like the one for Koramangala here that I often go to, has membership restricted to only the regulars at that CCD. The discussions there are an extension of what they are discussing offline: Do you like this new flavor…That’s a powerful thing that the brand needs to take care of, whether reality show, products, meeting places.
Which would be the top 5 categories of advertisers on Orkut?
Singh: I cant give segments specifically, but we see good traction across financial services, technology, automotive, travel, local.
How was the experience of integration of Adwords into Orkut?
Singh: Absolutely fantastic: it allows a single Adwords interface for advertisers, and they are able to use Orkut as an option – the same budgets, media planner that they are comfortable with. The financial services cases that I spoke about came in because they were strong and mature Adwords advertisers, and it was fairly easy for them to integrate the entire Orkut experience into the Adwords interface.
How are the CTRs on Orkut as compared to search?
Singh: I wouldn’t be able to compare them, but I can give you some instances of CTRs. For a financial services client, we saw a conversion rate of 13.5% on Orkut, which is what we are encouraged by.
But Adwords isn’t a part of the Orkut experience. It’s intrusive…
Singh: It isn’t. There is a single ad on a user page or a community page on Orkut, which is fairly prominent. With the targeting features that we provide, it’s fairly simple to make the ad relevant to the user – geography, age, gender and interest category. I think that’s why people are responding well to ads on Orkut.
Part 1: Orkut Zeitgeist, ID Theft, Indic Languages, Partnerships, Trends & More
Part 2: On Orkut Applications, Integration Of Google Properties, Mobile, Orkut Promote
Part 3: Branding & Monetization; AdWords, CTRs