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The latest Technology Review has an interesting article about social network business and how social networks still have a lot of challenges to monetize their communities. New models, but also new solutions, are needed. And a key issue is to get advertising work properly in the social media.

Technology Review summarizes the new technologies to get advertising work in social media: “Startups that help advertisers and marketers better target the users of social-networking sites are fashionable investments for venture capitalists in North America and Europe. Such startups hope to sell advertisers detailed information about individual social networkers. They include the brand-new 33Across (which we profile in our list of 10 notable startups, which begins on page 50) and the more established Finnish company Xtract, which counts Vodafone, T-Mobile, and Blyk among its customers and has begun selling its software to advertising agencies and online marketers and publishers. ”

Jason Pontin, Editor in Chief and Publisher of Technology Review, commented in the Millenium Prize event that our solution is the most complete solution he has seen for solving “the multi-billion dollar problem.” It is nice to see that we have really found a way to build solutions to monetize digital communities.

Yesterday we had the privilege to listen to Dr. Andrew J. Viterbi give an interesting presentation on the Science, Technology and Business of Digital Communications. He has been working in the middle of the mobile communications revolution and has left his mark in the field in many ways. Does the Viterbi algorithm sound familiar?

Dr. Viterbi is one of the Millennium Technology Prize Laureates for 2008. His lecture was a part of the Finalist Symposium that was held at the Helsinki University of Technology in Espoo, Finland. This year, the main Millennium Technology Prize, the largest technology prize in the world, was presented to Robert Langer from MIT for developing innovative biomaterials for controlled drug release.

The organizers of the symposium had also invited three promising Finnish companies to introduce themselves. All three companies combine science and technology with communication and are making solid business that aims “to someday repeat the success of Qualcomm”, as the organizers put it. One of these companies was Xtract and Jouko Ahvenainen gave the presentation that you can see below.

The presentation was about how to monetize digital communications and to deliver more relevant advertisements to end users at the same time guaranteeing more returns for the advertisers. In the audience was also Jason Pontin, Editor in Chief and Publisher of MIT Technology Review. He commented that our solution is the most complete solution he has seen for solving “the multi-billion dollar problem.” Afterwards we had some good conversations around the subject over some coffee and other refreshments.

Xtract was the runner up of a public voting to select Finland’s Most Promising Growth Company. View a 2 minutes elevator pitch for the jury by founders Kimmo Kiviluoto and Jouko Ahvenainen at the Helsingin Sanomat event yesterday. In Finnish only.

New Business Week (December 3, 2007) has an interesting article about big changes in the advertising business. The article focuses especially on Saatchi & Saatchi’s challenges to keep their revenue and find a new growth. They have won new customers (like J. C. Penney) and marketing professionals love many of their campaigns. But their clients have not got concrete commercial results from the campaigns. As Business Week says: “Yes, most clients still believe in creating an emotional bond with consumers. But Roberts had come to the conclusion that many companies are desperate for an über-consultant-a ‘brand navigator’-who, in a fragmented media universe, can help them to make that connection across multiple media.”

Business Week continues: (more…)

I was with the engagement marketing guru Alan Moore in Library House’s Media Tech event in London this week. Alan presented Xtract and Social Marketing Intelligence to the audience, which included many people from the leading media and investment companies. Advertising and social networks were the main topics in most of presentations this year. Antti Örling from Blyk (Xtract’s customer) especially emphasized the value of targeting and relevance in mobile advertising. He mentioned that Blyk achieved 12% to 43% response rate in their mobile campaigns, compared to the norm of 3% to 6% in mobile and 0.2% in the internet.

People still have a lot of questions, e.g. “how will social network, mobile advertising and business models be like in the future?”. But people see the value of targeting and relevance in digital advertising, and understand the “hot media” needs social marketing intelligence.

You can also read more from Alan’s blog.