1) We’ve discontinued our unpopular outsourced telephone answering service. Too many people told me that they didn’t like talking to nimrods reading scripts who knew nothing about the actual TalkShoe service. So now when you call support at 724-935-8265, you may have to leave a message if you don’t reach us live, but you’ll know that if nobody else picks it up, I will be notified within minutes.

Keep in mind that if it’s not a system-down issue, you should use our People-Powered Customer Support at www.talkshoe.com/support (or click the “Help” link from any webpage).

2) We’ve equipped our support staff with a new audio streaming restoration capability to fix streaming issues on the fly. We plan to put this capability directly into hosts’ hands in an upcoming release. Separately, we’re working to improve our audio streaming system so that it will be much more reliable.

3) We’ve fixed a server deadlock problem that’s caused two significant outages in the last month. Unfortunately, we’ve subsequently discovered a new one, which has already caused one outage (Wednesday afternoon, 6/25/08). That one will be fixed in the next week.

4) By popular demand, we’ve restored the monthly reports that were disabled when we paused the TalkCash revenue sharing program. This allows you to view your stats on a monthly basis, even though earnings are zero.

5) Even though it’s a new feature from last release, don’t forget to tell your callers to use *8 (*T) to request to talk.

TalkShoe Community Calling is up from May to June to new record levels. Against a backdrop of a few hosts being unhappy with the pausing of our TalkCash program, this is very encouraging. I personally thank you.

- Number of Participants; this count is displayed just above the show image on the home page, and just below the “Join In” button on the Live Now page. Frankly, we should have added this feature a year ago.

- Request to Talk via phone only; this is by far the more important new feature. Tell your callers that when muted they can now press *8 (as in *T for Talk) on their phones to request to talk. Very handy! When you notice phone-only users requesting this, please acknowledge it verbally as our system does not provide any other audio feedback.

By the way, both of these features were the result of your suggestions and requests. Please keep the great ideas coming.

The original concept behind TalkCash was to share ad revenues with audio content creators (aka podcasters), creating an economic incentive to use TalkShoe. It turns out that most people engage in Community Calling for two other non-economic reasons: 1) to more deeply connect with people having like interests [as humans, it’s in our DNA], and 2) to share their voice [essentially the same force that drives blogging]. We estimate that on TalkShoe less that 10% of people are in it primarily for the money.

Two supporting data points: In the past 12 months, the percentage of unpaid host listens on TalkShoe has risen from 3% to 61%. And during the same period, the average time a caller remained on the phone has gone from 31 minutes to 51 minutes. Yes, this is my baby, but even I am amazed at this level of engagement with an “Internet” application.

One other relevant detail: TalkShoe has been paying a subsidized ad-share rate of $10 CPM (1 cent per episode-listen) to hosts. While we sell ads at $20 CPM and higher, we’ve actually been paying out far more than we’re generating due to limited ad inventory. At this time, there are more important things to spend our investors’ money on.

If you’re a casual reader not involved in driving Web2.0 and new advertising models, stop reading here.

For those of you actually interested in the guts of this stuff, read on. I’ll share insights gained through almost two years of testing and tweaking our online audio ad program (aka podcast advertising). I’ll cover Micro-Segmentation, Podcast Advertising Effectiveness, CPM Rates, Host Read Endorsement vs. Non-Host Recorded Ad Insertion and more. And I’ll tell you about a campaign worth $2,747 CPM.

Micro-Segmentation

TalkShoe has demonstrated that audio advertising can be very valuable when properly targeted to narrowly-segmented audiences. An example of this is my Cellar Dwellers Home Winemaking show. Brad Ring, the editor of WineMaker Magazine, emailed me after discovering the show on iTunes. He wrote something to the effect of “Dave, every one of your listeners is a perfect candidate subscriber for my magazine; let’s do a deal.” And even though I average just 500 to 800 unique episode-plays per week, we did. Anecdotally, it appears that a very high proportion of my listeners now subscribe to Brad’s magazine, although neither of us knows the exact numbers.

Now that I’ve seen it in action, the power of micro-segment targeted advertising is undeniable.

Podcast Advertising vs. Internet Advertising Effectiveness

I don’t know about you, but I’m getting pretty good at ignoring most Internet text and banner ads. I suspect that I’m not alone, as I’ve heard that Google’s click rates are dropping.

By comparison, Internet audio ads (my generic name for podcast advertising) have one big positive and one big negative. On the plus-side, our evidence indicates that people actually listen to them. When you turn on your iPod, you’re not talking so you listen. How many times have I heard an Acura ad on an NPR podcast, and yet I still notice them? Heck, as a lifetime Toyota/Lexus driver, I might even consider an Acura next time.

On the minus-side, unlike with Internet ads, an iPod provides no mechanism for clicking on something. Attention: Steve Jobs, entrepreneurs, and/or any venture capitalist; solve this problem and make a billion or two. Cell phones may be the key — texting a code or pressing a button on an Internet-enabled phone could provide for that immediate response. We need it.

Audio Advertising Rates

In addition to advertising for WineMaker Magazine, TalkShoe has run campaigns for Ambrosia Software, Audible.com, Citrix Systems (GoToMyPC and GoToMeeting products), GoDaddy, PageFlakes, and a couple dozen individuals. Rates have ranged from:

• A low of 2 cents per impression to…
• A high of 5.5 cents per impression.

We also tried some “remnant” advertising at 0.3 cents per impression, just to prove to ourselves that it is a very bad idea and should not be repeated. Ads that aren’t relevant to a listener are simply clutter and diminish the value of the good stuff.

Even higher rates can be justified where there is a good match between advertiser and audience (don’t miss the Brehm Vineyards example at the end).

A side note: As with Google AdWords, TalkShoe allows individuals to run online audio ads on a small scale; as low as 1,000 impressions for just $20. You simply can’t do that on offline channels such as radio. But many of these people didn’t understand how to craft a relevant or compelling message, nor did they execute sufficient repetitions. Even though most of us are experts in watching ads, creating them is a lot harder than it looks. Seriously, don’t try this at home!

Host Read Endorsement vs. Non-Host, Recorded Ad Insertion

We’ve experimented with two different approaches to podcast advertising working with Blubrry, a leader in host read endorsement, and Kiptronic, the torchbearer for non-host recorded (dynamic) ad insertion.

Host read endorsement has been the preferred model in radio for years. Rush Limbaugh gets probably a 30% premium for his personally voiced ads flogging the Sleep Number Bed because if you like Rush (or even if not), his endorsement is more likely to influence you. However, while this proven approach works for individual podcasters with substantial audiences, it doesn’t scale down very well to the network-of-lots-of-hosts model. The costs of matching a specific advertiser with a specific host, developing and delivering the message, and then verifying effective delivery, just don’t make sense on a small scale for a network. How would an advertiser even choose the hosts to whom they’d hitch their reputation? They’d have to find 100 hosts to reach 100,000 listeners. It’ll never happen.

To me it’s obvious that non-host recorded (dynamic) ad insertion is the path for a network! Among other reasons, over 30% of TalkShoe’s episode-plays are for recordings more than a month old (the legendary “long tail”). Only by putting a fresh ad in an old recording can you monetize it. Believe me - the folks who made “Snakes on a Plane” won’t still pay you for running their ads today.

Matching is done based on category (e.g., sports) or topic (e.g., winemaking), and listener demographics (age, gender, etc.) and location (derived through IP address). It’s far better than radio and will get better still.

By the way, ad insertion technology still needs to be enhanced in two other ways: 1) interstitial insertion (in program, not just pre-roll and post-roll), which we know our friends at Kiptronic are all over, and 2) a comprehensive “Audio Ad Words” type marketplace for buying impressions. Come on Google; unleash your dMarc technology on the Internet for podcasting. We want it; we need it!

Critical Mass (Audience)

It may be obvious, but a certain scale and a certain level of automation are required in order for micro-segmented advertising to be meaningful and cost-effective. You can’t pay a salesperson to chase deals that generate $10 - $16 per week (that’s what it would cost WineMaker Magazine to advertise on my show at 2 cents per impression).

TalkShoe is now delivering more than 12 million unique episode-plays annually and we can see that our business will become more valuable per unit as we grow to 50 million or, better yet, 100 million unique episode-plays. There’s a definite knee-in-the-curve where growth drives “extra-linear” value (I’d say “exponentially”, but that connotes hype I am trying to avoid).

Inventory Utilization (Emergence of the Online Audio Ad Market)

As all of the airlines know, having a seat on a plane is one thing; filling it is another. The third quarter of 2007 was TalkShoe’s best yet, when 23% of episode-plays carried paid audio ads. However, fast growth in episode-listens makes this number hard to keep up with.

Advertisers generally targeted “categories” rather than individual shows. The Business, Computers, Education, Sports, and Technology categories were most popular. I expect us to average 20% utilization over time, but with less interest in advertising in Politics, Arts & Entertainment, Pets, or Government categories (poor demographics or too controversial). The Religion category is a wild card.

To repeat the subject of this post and not to be forgotten is that the online audio advertising market is still in its infancy. A lot of work needs to be done to establish credible case studies and compelling ROI data. But it’s not all bad news. TalkShoe is using its unsold inventory to drive its own growth and it’s working! Last quarter, volume was up 70% over the previous quarter.

The Most Effective Advertising Ever

So here’s the story of what may be one of the most effective “ads” in the history of the world, on TalkShoe or anywhere else (a claim that I realize can’t be fully proven, but hang with me). In early 2007, a listener sent me a bottle of wine he made from Peter Brehm frozen grapes. It was fabulous, comparable to the best wines I’ve ever tasted. If you’re not familiar with them, Brehm Vineyards grows fantastic grapes and freezes them when they ripen each fall. That way, a winemaker can buy them and get started any time of year.

On January 16th, my wineaux partner “The Other Guy” and I bought Brehm grapes and broadcast the first of six episodes about “Frozen Grapes”. We involved listeners and participants-by-phone in vicarious winemaking with our own Brehm grapes. By the time of episode six on February 20th, at least a dozen listeners had written to say that they too purchased grapes from Brehm. With only 1,547 episode plays during that period, we generated at least $4,250 in sales for Brehm Vineyards. On a CPM basis, that’s $2,747. That’s the power of micro-segmented advertising.

The Bottom Line

So I’ve seen the future of audio advertising. It’s still lacking an instant click; dynamic interstitial insertion is not yet widely used; and no automated marketplace has achieved either full functionality or critical mass. But the ads are relevant to me and they work! As TalkShoe grows and the market develops, we’ll unpause our TalkCash program for the 10% of you who want to “broadcast yourself” and get paid! Until then, just enjoy actually talking with your online friends and groups.

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Jesse’s depth of knowledge on a range of eclectic issues is impressive, and he always holds his own. If you haven’t done so already, check him out on TalkShoe.

This past weekend, during a special Saturday edition of Jesse’s Talkshoe broadcast, Jesse’s father – rock legend Dee Snider of Twisted Sister – phoned in for a candid give-and-take with his son.

A MTV camera crew was there as well, recording Jesse as he chatted live with his father and his fans on TalkShoe.

Tune into MTV’s “Rock The Cradle” this Thursday, April 24, at 10 p.m. ET. And keep tuning into Jesse’s show on TalkShoe!

Jesse’s MySpace page
CLICK HERE to Vote for Jesse on Rock the Cradle

TalkShoe today announced the launch of their Facebook application. As someone who is fairly familiar and a semi-frequent user of the TalkShoe system, I can attest that this is a welcome improvement to the system. This isn’t to say that dealing with the website is in any way unpleasant, as they’ve made a number of usability and aesthetic improvements to the main website lately. On the other hand, TalkShoe, despite extensive partnerships with whitelabel social network Ning, hasn’t seen viral and exponential growth of the service despite employing many viral marketing tactics.

That could change, though, with the deployment of the Facebook application, as it’s very robust in it’s functionality. You just about everything through the Facebook application that you can do through the site. On the user side of things, you can browse, search, and join conference calls and live podcasts. On the host side of things, you can create new episodes and conference call sessions as well as perform episode management tasks.

“The TalkShoe Facebook application lets me add a whole new dimension to my social networks because I can easily and instantly invite both Facebook and non-Facebook users to join my community calls,” said well known lifecaster and avid TalkShoe host iJustine.

Today’s Facebook Review is about the new Application called TalkShoe. What is TalkShoe ?? …you may ask, to what I would reply…. this Application is all you need to communicate in Facebook with all your Friends either through VoIP as well as through your phone or chat. Even more, with this Facebook Application you can create your own podcast and save it to send to your mother, friends, girlfriends, etc….. so let’s get it on with This Facebook Application Review, because that’s the reason you are reading this Facebook Blog.!!!

READ THE REVIEW
READ THE REVIEW

He will also be announcing a new product that is sure to put the voice in social networking.

EVENT DETAILS:

WHEN: Tuesday, March 11, 2008 from 6:00 PM - 9:00 PM
WHERE: Varnish Fine Art, 77 Natoma St., San Francisco, California 94107
REGISTRATION: http://upcoming.yahoo.com/event/444328/?ps=5
DETAILS: The event will include a bar and appetizers to enjoy.

Best regards,
Dave Nelsen - TalkShoe Founder