Marketers should pay attention and learn from the history of user-generated content in order to avoid making the same mistakes.

For those of you who read this column, you know the focus is on media operations. Ad inventory, video, behavioral targeting, staffing issues, ad servers, contract management, site analytics-- you name it, we've covered it. But a couple of recent news stories really gave me the urge to step up to a different, though somewhat related soapbox that indeed has implications for the operations groups.

In short, its my contention that with over 20 years of online/internet experience under our collective belts as an industry, there is enough history of what works and what doesn't work to furnish adequate guidance for marketers, operations executives and major media companies. Nevertheless, I predict that as more brick and mortar companies migrate to the web-- much of that history will go unnoticed and we'll make the same mistakes over and over again. (Although, maybe I shouldn't complain. If politicians in the White House can make the same mistakes over and over again, why should we be exempt!?)

A couple of cases in point:

The New York Times recently (April 4, 2006) ran an article called "Chevy Tries a Write-Your-Own Ad Approach and the Pot Shots Fly." The article described the innovative efforts of one of Chevy's ad agencies who decided they should give internet users the tools to create their own Chevy Tahoe video ads and post them on the web. The results as related by the Times were revealing. Here are just some of the titles to the user-created videos: 

• "Our Planet's Oil is Almost Gone. You Don't Need GPS to See Where This Road Leads"
• "Like This Snowy Wilderness? Better Get Your Fill of It Now, Then Say Hello to Global Warming"
• "$70 to Fill Up the Tank, Which Will Last Less than 400 Miles. Chevy Tahoe"

Now, in the accompanying article the ad agency and various pundits positioned this as a "good thing" because user generated content is all the rage and this type of feedback is expected. Wait a minute. You mean that GM thought that in the face of layoffs and rising stockpiles of unsold vehicles that this was a good thing? They thought that with the decline of SUV's popularity that the message would be "on point?" They actually knew this was going to happen and that the resulting coverage in the NY Times would be a benefit? That it was okay? Did their local dealers feel the same way?

My guess is that there was less attention paid to the history of user generated content and the negative environment that can be created when advertisers try to control it. As far back as 1988 online services created message broads that presented challenges to publishers in managing user generated content. Automotive companies provided forums for owners to discuss the merits -- or drawbacks -- of their vehicles. However, in the case of one very prominent Asian manufacturer, the boards were shut down shortly after they were created. Not only did they provide a forum for bragging about who had the most miles on their SUV, they also provided a forum for customers to band together and complain about vehicle problems, not to mention attracting ambitious attorneys.

Next up, MySpace
Why, in recent articles in The Wall Street Journal and The New York Times, has everyone expressed surprise that the site is challenging for advertisers? They don't seem to be flocking to MySpace and paying premium dollars. Does anyone remember GeoCities? How about AngelFire and Tripod? These properties, featuring user-based content, as well as other "communities" have been the bane of online ad executives for well over 15 years. Ask anyone who's been saddled with a quota based on that content. They monetize at an effective CPM of way, way, way under $1.00. They present challenges to ad operations who tries to figure out what to do with the unsold inventory. The reasons have been well documented time and time again. Mainstream advertisers are not comfortable placing their brands adjacent to content that is not of a consistent, controlled quality.

The implications for ad operations are many. There is added pressure to fill this inventory with advertisers, but many of them have a "not in my backyard" mentality. In other words, they want run of site rotation, but need to be kept out of user generated content. So there is additional blocking and tackling that ad operations needs to facilitate to keep campaigns running on schedule, while dodging the areas of a site or network that generate the highest volume of impressions.

Is there any value to user generated content? Of course-- to the users! It's one of the few remaining aspects to the internet that follow through on the promise of free speech, youthful exuberance, self-expression and the creation of micro-communities that bring people to together. It attracts million upon millions of users-- and that makes them a tempting target for marketers and companies looking for instant ratings success in MediaMetrix.

But any company prospectus discussing this type of content should read "While the audience is massive, their views and activity are impossible to control. They may be attractive to a handful of fringe advertisers, but will present challenges to blue chip companies who are looking to reach a quality audience. We may not be successful at monetizing this audience through CPM based advertising, although we can expect a halo effect achieved through the turnkey access to a large audience"

While there is much innovation to come on the internet, there is enough history to know that the fundamental things still apply. We are not in "beta" mode anymore, folks. I am hopeful, although not necessarily optimistic, that executives, marketers and media operations managers will take a moment to look back in the past to avoid repeating the same mistakes in the future.