Archive for February, 2013

Facebook lags as domain names and Twitter dominate Super Bowl 2013 ads

Friday, February 8th, 2013

By Adrian Kinderis

Adrian KinderisAdrian Kinderis, CEO of ARI Registry Services, says Super Bowl 2013 showed a brand’s domain name and Twitter handles were the dominant call to actions for the world’s leading advertisers – a fact that bodes well for the introduction of .brand Top-Level Domains in traditional advertising mediums

There is no surprise that marketers, advertisers and consumers pay close attention to Super Bowl ads. A Super Bowl campaign provides a brand with the opportunity to shine like no other event in the world, entertaining millions through the discipline of insightful, creative advertising.

Last year one trend in particular caught my attention – the common call to action used by advertisers to drive a response from consumers. My brilliant team of data crunchers found 49% of Super Bowl 2012 ads directed viewers to a corporate website address – above all other social media channels such as Facebook (11%) and Twitter (9%).

So when Super Bowl Sunday came around this year, I was intrigued to see what my team’s analysis would yield. Would domain names still remain dominant despite the growing popularity of social media?

Interestingly, out of the 73 ads that aired this year, domain names prevailed again as the preferred call to action used by advertisers, with 40% of ads containing a traditional web address. On the social media front, it was Twitter that dominated the playing field with 34% of ads featuring a Twitter handle or hashtag – a monumental jump of more than 300% from last year. In contrast, Facebook remained ‘on the bench’ with only 11% of mentions in Super Bowl commercials and Google+ was clearly stuck in the locker room with not a single mention.

With 108.4 million viewers, Super Bowl 2013 was one of the highest rating programs in the US, making the advertising slots some of the most valuable in the world. Reports suggest advertisers spent up to a record $3.8 million for each 30-second slot, with GoDaddy, Samsung, Audi, Century 21, Hyundai and Fiat amongst the many regular players.

For $3.8 million I’m guessing advertisers were hoping for a strong return on investment – and with so much riding on the success of each ad, the call to action driving the advertising message is clearly vitally important. The fact that domain names were the most popular call to action for two years running proves that advertisers prefer to drive an audience to a website for a purer, controlled brand experience.

The reality is that social media does not present the same level of certainty as a website. Despite –the impressive growth this year of Twitter mentions, this was normally in conjunction with another call to action such as a domain name. For example, Disney and Fiat featured both website addresses and Twitter handles (one to drive a brand experience, the other to create a conversation). Super Bowl ad veteran GoDaddy advertised with just their domain name last year, but added Twitter as an additional call to action this year. This is an interesting move from an organization whose business is the sale of domain names. I’d suggest this addresses a requirement to create brand engagement at times when a domain name purchase isn’t on the cards.

Intriguingly, only 19% of ads featured a Twitter handle or hashtag as the only call to action – compared to 25% for domain names. Hyundai and Century 21 were the biggest domain name fanatics, advertising with their website addresses only in both Super Bowl 2012 and 2013, while we found a Twitter devotee in Audi, who used Twitter as their sole call to action for both years.  The case was even bleaker for Facebook, with only 4% of ads featuring Facebook as the sole call to action (Pepsi was a lone ranger here). In fact, Samsung went so far as to drop their Facebook call to action from their 2012 ads in favour of Twitter this year – perhaps a recognition of the channel’s ability to attract online conversations around the world’s biggest events, be it sport, politics or a natural disaster.

For now, it’s clear that brands still see websites as their core digital asset – the quarterbacks of a brand’s digital strategy you might say. 

What trends will we see in future ads?

Despite the increasing trend for brands integrating their content through social media channels, my prediction is that websites, driven by intuitive and easy to recall website addresses will continue to remain the primary point of brand engagement for many of the world’s leading brands. Websites provide a level of control, interaction and measurability that social media just cannot match when considering brand experience, product immersion or direct response.

To support this, many global brands have invested in their their own branded slice of the Internet to allow for greater levels of engagement between their online content and their target audiences. And they are only just around the corner…

The new Top-Level Domain program

The global regulator of domain names, the Internet Corporation for Assigned Names and Numbers (ICANN), is getting ready to roll out its new Top-Level Domain program later this year. The program will see those that applied move beyond the traditional .com to .brand in a dramatic shift that will introduce a new platform for innovation, increased simplicity and recall for the domain name landscape.

Moving from samsung.com to .samsung for example, this unique slice of Internet real estate will change the way consumers around the world navigate to find online content, as well as reducing the reliance upon unwieldy forward slashes (/) to create an online call to action.

A .brand Top-Level Domain will allow trust, leadership, customer engagement and improved message recall to shine through by providing a direct connection between the customer and the brand experience – creating your very own branded ‘walled garden’. This will deliver the same control and measurability seen in traditional domain names, but it will provide new avenues for creativity, freedom and simplicity.

What impact will this have on Super Bowl ads in the future?

For those brands who have applied, a new Top-Level Domain will have a unique differentiator within the online space at their disposal – an asset that creates memorable, succinct domain name structures that will increase customer response and engagement from traditional advertising activity.

I suspect next year’s Super Bowl advertisers will be closely watching the new Top-Level Domain program and investigating the possibility of including a .brand Top-Level Domain when it’s their time to shine on the global scale. Dell, Toyota, and Samsung all advertised this year and all applied for a new Top-Level Domain. Their chance to innovate is just around the corner.

Just imagine seeing ads driving viewers to visit rav4.toyota, achieve.dell or galaxy.samsung in next year’s Super Bowl? Seems just little bit more compelling than “follow us on Twitter”.

By Adrian Kinderis
CEO, ARI Registry Services

The favoured new TLD registrar payment model

Wednesday, February 6th, 2013

By Chris Wright

This week, Thomas Barrett – the President of US based registrar EnCirca – published a timely article about how the registrar cash flow model could collapse with the imminent release of hundreds of new Top-Level Domains (TLD).

I would like to thank Thomas for raising this important issue and for encouraging all new TLD applicants to discuss this topic with their back-end registry provider.

Thomas is correct; the process new TLD registries choose to interact with registrars will have a major impact on the success of their businesses.

Building upon what Thomas has written, I would like to take this opportunity to provide insights from a back-end registry operator’s view and offer an explanation for why I think the post bill pay model is favoured amongst registrars and should be supported by registries.

While Thomas briefly touched on this point, I would like to expand upon it and clarify a few issues.

The post bill pay model

ARI Registry Services has spent considerable time developing effective payment processes between registries and registrars. Following considerable consultation, the post bill pay model was constructed in conjunction with some of the largest registrars around the world.

We support the post bill pay model because it is actually significantly simpler and most registrars like it. In summary, this model essentially means registrars receive an invoice from the registry operator for all billable transactions following the end of a billing period. There are no accounts and no need for funds to be transferred outside of these invoices, which significantly helps to reduce the financial risk and strain on registrars.

It’s worth noting that it can be important to make a distinction between transactions that can be reversed and transaction’s that cannot. To make it simple for everyone, ARI Registry Services does not bill registry operators for transactions that are still reversible. We will wait until these transactions become non-reversible before we issue any invoices to registry operators. We offer similar functionality to our registry operators with respect to registrar billing so that they also have the choice to do this.

Benefits of the post bill pay model

As Thomas outlined in his article, there are a number of questions new TLD applicants should be asking their back-end registry provider. I completely agree with Thomas and offer the following responses to provide clarity on the benefits of the post bill pay model:

1) Is there an “accreditation” fee charged by the Registry?

As a back-end registry provider, we don’t charge any accreditation fee.

In fact, we take this one step further. All established registrars that can demonstrate experience in integrating with registries of a similar structure to us do not need to perform technical accreditation processes with us. Furthermore, we strongly advise our registry clients against charging accreditation fees as this is an unnecessary barrier to entry for registrars and ultimately impacts the commercial success of the TLD.

2) How much does the Registry require as an initial deposit and for replenishments?

Deposits, account maintenance and funds for replenishments are abolished under the post pay billing model. We don’t see any need for these.

The benefit of the post pay billing model is that there is no need to have account balances in the registry and we can simply track the transactions and invoice the registrars.

3) How does the Registry communicate the existing balance to Registrars? 

When you move to the post pay model, all you need to do is provide a web interface that allows registry operators and registrars alike access to the billable transactions that have occurred in the current invoice cycle. Sending a daily summary of transaction totals is the preferred way to proactively inform registrars of what they have spent.

4) Is there an auto-renewal policy for non-renewed domains?

Thomas seems to suggest that registrars don’t like auto-renewal because they basically provide credits to registrants or credits to the TLD.

This is easily addressed by delaying raising a transaction for this renewal until the end of the auto-renew grace period. Alternatively we can use the post pay model and the principle of not charging for non-reversible transactions. These solutions effectively eliminate this issue so you can still support an auto-renew service without the registrar having to carry the financial risk.

5) What are the bank fees to fund your registry account?

This is eliminated under the post pay bill model because there are no bank accounts and deposits to be tracked.

6) What payment options does the Registry accept for funds?

In our post bill pay model (as a back-end registry operator), we don’t enforce any mandatory payment options. It’s relatively straightforward; we send the invoicing data to the registry operator, who in turn will load the information into their accounting systems and generate an invoice for registrars. Registry operators are free to accept payment via any of the standard commercial invoicing payment options, or indeed any other method they desire. 

7) Does the Registry have its own account for each Registrar or does the back-end provider provide a single account for each registrar for all of the TLDs the back-end provider manages?

This issue becomes a lot less of a problem under the post bill pay model because we do not require money to be deposited, and thus tied up.

Each registrar will get a separate invoice from each commercial entity (registry operator) they deal with (TLD or collection of TLDs).

8) Does the Registry provider emergency credit if funds run low?

Again, because there are no funds associated with the post bill pay model, this issue is eliminated.

Risk for registry operators

As can be seen in our responses above, the post bill pay model addresses all of the questions Thomas has raised. However, while reducing the financial burden to registrars, it does potentially expose the registry operator to more risk.

We argue that new TLD registry operators should be prepared to accept this risk given that it will make their TLD more appealing to registrars. Ultimately, if you don’t have any registrars, you won’t be able to sell your domain names.

Further, these risks are manageable and can be addressed. For example, you can conduct credit checks on registrars, ask potentially problematic or risky registrars to put money into escrow or offer a bond, track the amount of debt a registrar is accumulating, or ultimately completely cut off the registrar from the registry if bills are not paid.

There are a number of strategies available to reduce this risk to registry operators.

Promotions

A further benefit of the post bill pay model is that it offers the most flexible platform for registries and registrars to implement promotional offers, discounts, credits for marketing and other commercial pricing strategies.

Essentially, each registry operator can apply their own discounting or promotional strategy as credits towards invoices, without requiring back-end registry operators to manage these. This means registry operators do not have to rely on their registry services provider to custom build promotions into their registry system, or pay expensive development costs.

Impact on new TLD applicants

I strongly recommend all new TLD applicants to consider the post bill pay model for their registrar payment process.

As described above, this model reduces the cash flow burden for registrars, makes your TLD more appealing to them and allows each registry operator to negotiate their own terms with each registrar.

Remember, registrars will be a crucial element in the success of many new TLDs. The barriers to entry will be a key  parameter reviewed by registrars when making decisions about which TLDs to integrate with first and a post bill payment model will go a long way to reducing these barriers.

If your back-end registry provider does not offer a post bill payment model, it may not be too late to switch.

By Chris Wright
Chief Technology Officer
ARI Registry Services