My desk smells like strawberry ice cream. It’s fabulous. I can’t remember getting a bit of direct mail that excited me since, well, ever. Appropriate then, I guess, because it’s an ad for direct mail. And it came in the post.  Wonderful stuff, and lovely proof that until we get smellyvision or scenternet, sometimes you just can’t beat a bit of paperto get the ol’ factory system going. Maybe GM and Chrysler need more scratch and sniff ads. Kudos to the Open Mind Research Group.

I’ve been a little quiet on the blogging/Twitter front lately because there’s been a lot going on behind the scenes at work. De Pasquale, the creative agency which is linked arm-in-arm to DP Dialogue, has merged with Gallery to create Gallery De Pasquale (or GDP as I guess it will be known colloquially). DP Dialogue isn’t really affected by the merger, we’re still technically independent of it all and are still Queensland’s premier social media marketing agency, but we do gain a couple of staff members and do get to move offices. I think GDP is now Brisbane’s largest independent agency, in fact it’s probably one of Australia’s largest independent agencies, so that’s a little bit newsworthy.

Anyway, we’re working on some big, cool social media projects at the moment which are about ready to launch so I’d better get back to it. Was nice to see the Gruen Transfer give a hat-tip to social media last night too.

BBS.

Take the time, if you will, to meet Vincent Ferrari. I’ll let him introduce himself in his own words:

My name is Vincent Ferrari and I’m a proud half-Italian half-German NYC guy. I’m married with two wonderful cats, Pandora and Patches, and I live in a nice part of the Bronx (yep, they do exist!).

Vincent writes a blog called “insignificant thoughts“. It deals with technology stuff, religion and politics. I don’t read it. I tried to read it, but, I didn’t like it. Perhaps it’s because I’m a pompous know-it-all-jerk, perhaps it’s because it doesn’t talk about marketing or music or the sort of pop culture I like, either way, the title rings true for me. I have no reason to read Vincent’s blog and by not reading Vincent’s blog I’m fairly certain my life won’t be any worse off.

AOL, the giant American Internet company, didn’t read Vincent’s blog either. Nor did they pay attention to his YouTube rants. The company did, however, according to Wikipedia, have an elaborate scheme for rewarding employees who purported to retain or “save” subscribers who had called to cancel their Internet service. In many instances, such retention was done against subscribers’ wishes, or without their consent. Under the scheme, consumer service personnel received bonuses worth tens of thousands of dollars if they could successfully dissuade or “save” half of the people who called to cancel service. For several years, AOL had instituted minimum retention or “save” percentages, which consumer representatives were expected to meet. These bonuses, and the minimum “save” rates accompanying them, had the effect of employees not honoring cancellations, or otherwise making cancellation unduly difficult for consumers. Many customers complained that AOL personnel ignored their demands to cancel service and stop billing. Vincent was one of them.

If AOL had read Vincent’s blog or watched hius YouTube channel, they probably could have saved themselves $1.25 million.

There are about 400 million Vincent Ferraris out there in blogland. How many aren’t you listening to?

Better setup a few more Google alerts huh.

I was writing some content for e-CBD, the web design agency I co-own when I’m not working on DP Dialogue. This article on ‘Questions to Ask Your Digital Agency Before you Sign a Contract’ came out quite nicely so I thought I’d pop it in here… Enjoy!

• What qualifications and experience do the business owners have?

Web design companies often change hands and if you’re not careful, you’re likely to find that the person who runs the business knows very little about designing websites or best-practice online marketing principles. If you want to know you’re in good hands, choose a web design company with an experienced, qualified management team who have been running the business for at least a few years.

• Do your designers work in-house, or do you contract them out?

A lot of companies contract their designers out and they rarely, if ever, set foot in the same office as the person who answers the phone. That’s not necessarily a problem, but you’ll find designers who work as part of a motivated team tend to do better work than those working from their bedroom, in Eastern Europe. Quality control is also much easier when everyone is sitting within shouting distance from each other, and if you can pop in and talk to the designer at their desk on their computer, it’s much easier to communicate what you want and get your ideas across.

• What qualifications does your team have?

University degrees and TAFE courses are no substitute for talent, but they definitely help make it shine. You don’t need a PhD in Information Technology to build a website, but it’s good to know that at least a few people on the team have taken the time to get a tertiary education and learn best-practice principles from those in the know. Any high school student can knock together a basic web page these days, but if you want a site that helps you make money, you need someone who has studied the theory behind making that happen.

• Who does your programming?

You’ll invariably need a feedback form, shopping cart, funky map or some other little gadget on your website at some stage. Make sure the person who does the programming knows their stuff and get a reliable, set-in-stone estimate of the timeframe for completion. Many web design firms out-source the tricky bits to interstate or overseas contractors and communication errors and long, unexpected delays are common.

• Are you certified by Google?

Google offers certification courses to people and companies who can demonstrate that they know how best to promote a site in their search results. It’s certainly not mandatory to have a site built by a Google-certified company, but it does show a high level of commitment and professionalism, not to mention recognized expertise.

• I want a website, but I also want help marketing it, do you do that?

Online marketing is more than just getting your site into Google, although that’s arguably the most important start. A good web design firm should be able to help you work out exactly how the Internet fits in your overall marketing plan and point out strengths, weaknesses and opportunities for you. They should be able to provide you with a detailed search engine optimisation plan that embodies Google’s guidelines, create and manage a paid search campaign, advise on banner ad placement and suggest other ideas like affiliate marketing, social media and viral. If they don’t do that, they should at least be aware of the issues and able to put you in touch with a reputable firm who can help. The last thing you want is a website designer who builds the site without even considering any marketing opportunities - or worse, one who doesn’t know enough about what they’re doing and ends up getting you in trouble. If they’re claiming to be an expert, ask for solid proof of their claims and evidence of their knowledge in peer-review journals and mainstream publications.

• What are the payment terms?

Most companies will ask for a deposit up-front before they start working on your project. This helps with their cash-flow and it’s a sign from you that you’re serious about getting something done. A normal amount is anywhere between 10% and 50%, anything more than that and it’s starting to look risky. A website is a big investment, so ask if you can pay the remainder of the fees off over a period of a few months. Make sure you get a detailed quote that outlines every component of the project and ask if there are any fees over and above what they originally say. You don’t want to find yourself paying for endless ‘updates’ after you thought the site was finished.

• Can I update the website myself?

Ask what sort of content management system they recommend and if they offer a variety of choices. This will save you big bucks.

• Do you provide a money-back guarantee?

Ask what will happen if you’re just not happy with the end result, or if they fail to complete something they said they would.

• Can I ask some of your clients about your service?

Find out what work they’ve done and call their clients to see what they thought of the service. Any half-decent agency will have a bunch of testimonials, but every agency in the world has done work for their brothers, sisters and cousins at some stage. Ask for a few examples, and call them. If they were happy with the service they shouldn’t mind a quick chat about your potential new designer.

This article is a collaboration between myself and Nathan Bush (A.K.A. Another Advertising Wanker, A.K.A. AnotherAdWanker). We’re both strategists at Brisbane advertising agency De Pasquale and had our ire raised a notch when we found out The Starlight Foundation had spent $14 million on its own social network. The fact that we’d been working on a similar project for The Children’s Hospital Foundations had a little to do with it, but mostly, we just couldn’t figure out how they could drop that much dough.

You may have heard about the new social networking site for sick children produced by the Starlight Foundation called Livewire. It is similar to a Facebook or MySpace application but only available for children in hospitals or with serious illness. As Daniel Oyston points out in the Marketing Today podcast, it is an incredibly valuable service for the kids and will no doubt help them feel connected, positive and strong in their recovery process.

However (and I think you knew that was coming), if we put to the back of our minds that this is a children’s charity, there are a few questions that have to be answered in regards to the cost of the project and the allocation of tax payers money. Cameron Reilly addresses this in his podcast with the Livewire creators here.

The crux of the issue is that the cost to develop the social media project over 18 months was $14.7m. The Government supplied $7.2m through Senator Stephen Conroy’s Clever Networks program. The remaining 30% was supplied by Starlight and 20% from other suppliers (keep-in mind that this is not necessarily all cash and includes some in-kind donations).

Nevertheless, $14.4m is a lot of money for a social media project so we will list all of the elements we could find which are included in this budget:

Online platform including social networking tools, chat, mobile platform

Let’s presume you’ve downloaded Ning, analysed it, and then made your own version of it. Let’s say you then get a team of one designer, one project manager and two programmers working exclusively on this for two months. That’s four people times $150 an hour times two months. If you played a lot of ping pong in between meetings, and got your agency’s agency to mark it up a few times you could probably get to $250,000.

Competition Engine

Let’s call it $25,000. That’s one junior programmer working for six months. If you can’t do that for $25,000 you’re doing something very terribly wrong.

Hosting

WebCentral are about the most expensive hosting provider in Australia. Two of their dedicated servers will cost you about $20,000 a month. That’s $160,000 over a year.

Content Management

You could use a free open source CMS like MODx, but your agency won’t make any money out of that, so they’ll convince you to spend $60,000 on some proprietary piece of shit that does the same thing.

Content

Hire a pretty blonde with a PR degree and she can punch out content for 12 months for $60,000.

Customised manual sign-up to increase data security

Call it $5000.

90 computers and tables in hospitals for children to access from bedside

Dell will sell you 90 computers for $108,000. Presuming the kids are happy with IKEA and don’t need rich mahogany, you should be able to get 90 tables for $9,000

Wireless networks and wiring in some hospitals

Five business plans and a few modems - call it $10,000

Parents and siblings site to come by the end of the year

Surely you’d build this in the initial stages as part of the whole thing?

Two therapeutic studies on the benefit of social networks to recovery

Two w@nkers telling you shit you already know like “kids who can interact with other kids have faster recoveries than those stuck in solitary confinement in a Romanian orphanage”. $100,000.

15 full time employees in total - chat room hosts, editorial, security and an outreach person in each state to work with partering organisations to demonstrate how to use the site

$60K a year each, so that’s $1 million, tops.

Training program for chat hosts with the Australian Federal Police

Let’s say they had two police officers training staff for two days. That couldn’t possibly come to more than $10K. Cops don’t earn that much.

TOTAL

$1.79 million

As you can see there is a lot more to this project than just being a social media site - especially in regards to security and support. However, we still can’t see how all of $14.4m will be completely spent by the end of this year. We can get to around the $1.4m mark with some generous estimates. This leaves $13m unaccounted for. This leaves us with some questions:

1. As Cameron Reilly points put, is there any reason to reinvent the wheel? Surely a free network creator such as Ning and embedded content would have significantly brought the cost down with no major impact on functionality?

2. Will the publicity around social media projects such as this and the budget being used scare other charities off playing in the social space? We know that charities can do sites such as this for next to nothing - but will they ever bother to explore now?

3. Livewire is aiming for 20,000 members by the end of the year. Given the funding of the program (which ends this year) - this equates to $735 per member. Is this a responsible allocation of funds when our hospitals have a long wish list of other resources required?

Don’t get us wrong, it is a great project and will do wonders for the kids. But surely we need more accountability here?