ILM East 2012 took place last week in Boston and is now one for the history books. It was definitely a fun show that really showcased the fast moving local innovations that BIA/Kelsey focuses on.

There are many learnings we can focus on as takeaways, but in the interest of good reading, how about a top 10 list?

1- The new currencies are time, attention and clickstreams. Payments can be in pixels, Facebook mentions or points and rewards (Ted Leonsis, vice chair, Groupon).

2- Email is for e-commerce push; phones are for texting (Ted Leonsis, vice chair, Groupon).

3- Local is all about scale. And the only way to achieve scale in local is by aggregation (Jay Herratti, outgoing CEO, CityGrid Media).

4- Creating a closed loop is the path to a seamless user experience. American Express is … the acquirer, the issuer and the network (Leslie Berland, SVP, American Express).

5- Daily deals are fun, but Big Data that combines different databases is critical for targeting users and winning loyalty (various).

6- Focus on engagement, not new customer acquisition. Loyal customers are worth 24 times more than new customers (Charlie Kim, CEO, NextJump).

7- Email fatigue is probably out there, but social media complements email, rather than kills it. They are both forms of permission marketing (Mark Schmulen, GM, Constant Contact).

8- Video is a great local medium, but offers limited inventory opportunities, and really can’t compete as a standalone with a major metro newspaper for advertising (Lisa DeSisto, VP, advertising, The Boston Globe).

9- National brands can’t go local without a platform. Otherwise, you can’t get engagement and you’ll see high churn (Pete Gombert, founder and CEO, Ballihoo).

10- You can’t herd 6,000 cats and come up with a digital strategy (Adam Epstein, president, Ad Marketplace).

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Ted Leonsis, Groupon vice chair, American Express board member and Internet pioneer, emphasized the importance of scaling for local in a global economy during a keynote at ILM East yesterday. “Indiana really matters. India matters more,” said Leonsis, pointing out that for larger companies, most growth will come from outside the U.S.

The way that growth is measured, however, is rapidly changing. “I try to follow the new currencies: time, attention and clickstreams,” he noted. “Now you see payments in pixels, Facebook newsfeeds, or points and rewards. AmEx has trillions of points.

While growth for “the biggest companies” comes from serving the entire international marketplaces, local needs are universal.

“I love local; we built Internet on businesses created about ‘you,’ ” said Leonsis. “There is no bigger business imaginable.” He noted special opportunities in “MoSoLo….the convergence of mobile, social, video.” Mobile will make up 88 percent of digital advertising, he suggested, citing analyst projections. “One thousand cities are ready for MoSoLo.”

Leonsis believes that the largest companies will soon be making spending sprees in the local arena. Local entrepreneurs should realistically shoot for selling their companies because only a couple of companies end up IPOing in the public market, added Leonsis, who is, of course, a major investor.

Leonsis noted that the largest companies such as Google, Microsoft and Cisco are sitting on almost a trillion dollars of retained earnings. “That’s pent-up cash. They will want to fill in their value chains.”

Channels are also changing, and quickly. Email usage is way down and has “become a deliverer for e-commerce push. Email is for manicure or pedicure deals,” said Leonsis, noting that Groupon and Facebook are really poised to leverage this with their massive email lists. Phones, meanwhile, are for texting. The average teen sends 70 texts a day and barely use any minutes to talk.

But Leonsis predicts that video will emerge as the new killer app as it becomes the core medium for self expression and sharing. “The YouTube phenomenon is truly amazing. We’re all becoming cable MSOs.”

Video also will be key to the future of retail and education. Retail site visitors who view video are likely to stay on site two minutes longer on average and are 64 percent more likely to purchase than other site visitors, said Leonsis. Video is a foundation for “next generation commerce.”

The pursuit of closed loop network is the really big game here, Leonsis noted. Amazon has made everyone an affiliate and a reseller. Similarly, PayPal made made everyone a small business with 100 million-plus accounts for money transfers and payments. EBay has made everyone an entrepreneur.

Moreover, Google has 8 million advertisers on file, and invoices 20,000 advertisers. AmEx has developed a closed loop system of its own, and Groupon has created “curated local commerce.”

But Leonsis is skeptical that the world of interactive local commerce is something that start-ups can gain traction in. “No one will give an eight-person start-up their social security number. Payments are not for the faint-hearted. Start-ups are better off looking for margin opportunities.

“I don’t want to see any business plan saying ‘I’ll be the next Groupon.’ Verticalization happens.”

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The website and related digital properties still drive much of their identity from the core brand, but are native supplements, not merely extensions, of print. NY Magazine has expanded deeply into verticals, with fashion galleries (an early “anchor ad category”), Vulture celebrity site, various niche blogs (its highest traffic driver) and a shopping section built on original editorial content.

In addition to the rich editorial, restaurant listings feature menus from MenuPages (which the company bought in 2008 and sold to SeamlessWeb last fall), online ordering through Seamless and reservations through OpenTable. NY Magazine is now expanding categories beyond just dining. Silberman said that deep listings content adds balance to the site by helping readers “solve problems.”

NY Magazine also runs an aggregated, curated weekly deals product (“the best of NY”) that’s integrated into its robust email newsletter business, but is now considering sourcing its own through a partner.

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Juan Delgado, Managing Director, Americas, Perform

John McIntyre, CEO, Backyard

Randa Minkarah, Senior VP of Revenue and Business Development, Fisher Communications

David Simon, VP, Advertising Solutions, Local Corp.

Video is everywhere you look, from your smartphone to the back of a cab, and at your gas station. National advertisers understand the power of video as a compelling tool for brand recall. “As usual the big kids get to go first,” said David Simon of Local Corp., referring to national brands being ahead of the curve in video advertising. Local Corp. created a platform where anyone can create rich media, which includes video and any one of the following: animation, page interaction, data and dynamic feeds. But if you look at the marketing efforts of a local SMB, you may not find video at all, or if it’s there, it’s under-utilized. Video Local Media Program Director Rick Ducey moderated today’s panel that suggested ways to integrate more video into local marketing campaigns.

“The broadcast business is completely local,” said Fisher Communications Senior VP Randa Minkarah. Minkarah presented a KOMO News Network case study to demonstrate how one local television station changed its approach to business by pushing video from television to online via the station website, radio and smartphones. This method provides unduplicated reach, as there are different audiences on each platform. Fisher plans to implement a similar approach to enhance multi-platform sales efforts.

But what works for local media may not be as easy for SMBs. Backyard CEO John McIntyre identified two key problems in getting video out to consumers. “Local video advertising is not keeping the pace with consumer changes,” McIntyre said, citing the fact that the number of YouTube users outweighs the number of local advertisers on the video sharing site. Innovative technology from video providers is one way McIntyre believes will break down the barrier to increased video adoption. A second issue is building trust between the SMB and video provider. “Innovation must clearly deliver results,” McIntyre said. Backyard launched a free trial of its product to demonstrate its efficacy to customers. “Within eight weeks, it from zero to almost 150,000 in recurring revenue,” McIntyre said. In addition, Backyard saw more than 60 percent of free trials convert to paid customers.

Perform’s managing director, Juan Delgado, seems to have found the sweet spot. His company combines sports video highlights and YouTube’s audience reach. Perform syndicates national sports content across 250 publishers nationwide. “We have the ability to access ad budgets that traditionally went to ESPN, and we’re channeling some of that to online video,” Delgado said. By getting professional sports leagues to license their sports highlights, Perform is able to syndicate the content at no cost to the publisher while it retains ad sales rights.

In addition to the suggestions of our panelists, we’ll be reporting on additional technological innovations and case studies that advance the power of video for SMBs.

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The biggest boom in local is actually national. With geotargeting options, better metrics and better creative national brands and agencies are increasingly going the local route. GroupM research shows that 83 percent of brand advertisers expect their local online spending to be more than their overall projected online growth (25 percent) over the next three years. The session “National Advertisers, Targeted Locally” looked at the ins and outs of working national angles and local targeting.

Steve Sherfy, Local and Mobile Search Manager, GroupM Search

Adam Epstein, President and CEO, adMarketplace

Pete Gombert, Founder and CEO, Balihoo

Karl Siebrecht, President and CEO, AdReady

The panelists represented ad networks and agencies involved with helping national brands purchase local online advertising, including display and pay per click. One of the challenges they face is balancing the national brand’s need for control over strategy and messaging with the affiliate’s unique local knowledge.

AdMarketplaces’ Adam Epstein used the upcoming presidential election to illustrated this challenge. A national campaign headquarters might not understand all the local keywords they should be buying to tap into what motivates voters. In New Jersey, the keyword “deleveling” (it involves a local schools issue) is critical, but only a local campaign operative would know that. The same could be said for a local branch of a national restaurant chain.

Ultimately, the panelists agreed that national to local only works in a top-down model, but the national brands need to find a way to leverage local knowledge.

Pete Gombert, founder and CEO of Ballihoo, learned the hard way that trying to go around the national brand to sell directly to local affiliates didn’t work. “We found that selling to local SMBs is really expensive, it’s hard to get them to engage, and you see high churn,” he said. “We discovered that if we focused on how to create a platform to allow national brands to set up rules for how programs are enabled at the local level, then just let the program run, that works well.”

Epstein described it this way, speaking specifically about the automotive sector, which he says does national to local particularly well: “Local has to buy in to what you are doing. Internet is about scale. There has to be decisionmakers looking at a lot of data. You can’t herd 6,000 cats and come up with a digital strategy.”

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Geoff Cramer, CEO of SocialMadeSimple

Adam Japko, President of Digital Sherpa

Mark Schmulen, General Manager of Social Media for Constant Contact

Neil Kataria, President of newBrandAnalytics

Catherine Tucker, Associate Professor of Marketing for MIT Sloan School of Management

Social Local Media Program Director Jed Williams kicked off the SuperForum with BIA/Kelsey data that show 40 percent of SMBs have a Facebook page for brand awareness purposes. However, the industry is in the midst of a paradigm shift from SMB social management and presence to targeted, interesting content for users to read and share. Our first three panelists represent companies with three different approaches to social content curation for local merchants: outsourcing, automated and do-it-yourself (DIY).

When it comes to social content solutions for SMBs, Digital Sherpa’s Adam Japko said, “We are platform and strategy agnostic.” His rationale is that tools and platforms are constantly shifting in the evolving social media landscape. What Digital Sherpa focuses on is helping SMBs get better search engine optimization through content on blogs. “Blogging is powerful,” Japko said. “People find content on the Web and blogs are a great way to promote that content.” Japko sees social media as a tool to leverage blog content. “At the heart of social media marketing are the content creators,” he said.

SocialMadeSimple takes a different approach. Its white-label platform helps SMBs manage their social presence with industry specific analytic guidance and curated content. SocialMadeSimple’s content library offers industry-specific content selected by editors in the form of pre-formatted links, articles and news stories along with RSS feeds. Subscribers can click a button to broadcast to one or all of their social media networks and blog. Its media partners can also add their content to the library. “With our platform, we tell [SMBs] what they need to do,” said CEO Geoff Cramer. “We believe that curating and sharing interesting content is a part of an [SMBs] brand voice.”

“Social media is going to kill email.” Constant Contact General Manager Mark Schmulen didn’t believe that when he first heard it a few years ago and he doesn’t now. However, Constant Contact has evolved from a primarily email marketing focus to social campaigns. As a DIY marketing services company, Constant Contact is able to serve SMBs content needs and, according to Schmulen, keep costs low. Schmulen sees social media and email marketing as complementary. “Both are forms of permission marketing,” Schmulen said. But he doesn’t see social media as the holy grail of content curation. “Starting a conversation inside email is the best way to start social media engagement,” Schmulen said, citing an email open rate of more than 20 percent.

In what other ways are SMBs measuring the success of their marketing campaigns? SMBs need actionable results. Some SMBs just look at Facebook fan numbers to gauge their audience reach. But quality is more important than quantity. SMBs want reliable, consistent people to comment and share the content on their Facebook and Twitter pages. “At its core, social media marketing is about word of mouth,” Schmulen said.

MIT’s Catherine Tucker echoed a similar sentiment during her presentation on Facebook ads. Her data showed that 75 percent of increased effectiveness of ads on social networks came from social targeting rather than social endorsements. The current issue with Facebook ads is that it assumes all friends on a consumer’s Facebook page are equal, therefore any friend’s endorsement of a product is enough to create additional shares and conversion. But most users are predisposed to pay more attention to the brands that their close friends interact with.

Local merchants can benefit from segmented data about existing and potential customers. That’s what D.C.-based newBrandAnalytics believes. Its technology allows them to measure social media customer feedback on a store-by-store basis. We’ll continue to examine how social business intelligence can empower local merchants to improve their operations by helping them better understand their individual customers. Here’s a visual example from President Neil Kataria on how it works:

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Eight billion dollars. That’s the total estimate of political advertising spend this year given by Andy Slater, vice president of digital agency sales at Katz 360, during our morning session of day 2 at ILM East. Of $8 billion, Slater predicts that online ad spend will be between 3 percent and 5 percent. Slater has 18 years of experience in advertising sales, including 12 years in radio.

“We are a one-stop shop,” Slater said of Katz 360. The digital arm of Katz Media Group, Katz 360 aggregates its digital offerings. For example, it offered a Super Tuesday package for clients in relevant states with a combo of pre-roll video, display ads and email marketing they could send to Democrats, Republicans or Independents. Katz 360 clients include national television and radio broadcasters. “Most broadcasters today know they need a robust and mature digital offering not just for advertisers but for audiences as well,” Slater said. “Digital integration lets them drive traffic from on-air to the Web.”

Agencies and political action committees (PACs) are also more focused on audience targeting rather than site-specific targeting, Slater said. Audience targeting includes capturing a cookie of someone from his or her computer on a website and aligning that with offline data such as household income, place of residence, etc. PACs can further match that data with voting records and deliver a targeted message accordingly. “Online lets them have multiple strategies,” Slater said. He’s seen ad budgets break down spend with one-third in search and targeted display. The rest is used for email marketing, online video and audio.

Although we’ve seen early numbers from the presidential election primaries, the ad spend of local political candidates is less forthcoming. “We are waiting for it to kick in,” Slater said. “Everything else has to vet out until we get closer to the elections.”

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The New York Times and other news organizations have been hampered by the short cuts of HTML and hyperlinks, but are now reclassifying to provide more structured, fluid data in a major development with massive implications, noted New York Times VP of Research Operations Michael Zimbalist, who keynoted Day 2 at ILM East. The benefits are immediate in terms of SEO, but longer term, provider richer product for consumers, said Zimbalist.

“Information has become increasingly granular or structured,” he said. “Each unit of content has extensive machine readable metadata about itself.” Fluid information can move more easily among machines and people.

In the case of The New York Times, it can now process the 300 pieces of professional content it produces every day — a brick of compiled information — into multiple formats, including things such as personal editions and slide shows. “You are reaching underneath the databases the power the Web to do new things,” said Zimbalist.

The key is to move the surplus of names to strong identifiers that are linking to data cloud driven by meta data. The Times, for instance, is embarking on moving all its data to DBpedia, which drives Wikipedia, Freebase, which is owned by Google, and GeoNames. To date, 29,000 names have been recontextualized for a new semantic platform — a “super librarian” — which includes 39 percent of people (“Edgar Allen Poe”), 31 percent of organizations, 76 percent of locations (“Park Slope”) and 14 percent of descriptions. “The future is bright for librarians,” joked Zimbalist.

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Long before daily deals surged, and now after they’ve peaked and pivoted, loyalty and rewards programs stand as beachheads in the evolving online promotions/commerce ecosystem. At ILM East 2012, three leaders in loyalty discussed how advertising and commerce are quickly colliding, and how “big data” is shaping the new merchant/consumer relationship.

Next Jump CEO Charlie Kim suggested that advertising and commerce have been on a collision course for decades, with the paradigm shifting from acquiring new customers to acquiring new, loyal customers. Data he shared — loyal customers are worth 24 times more than new customers just acquired — supports his theory. Next Jump, which runs 90,000 B2B merchant-funded loyalty programs, is placing its bet on points systems that reinforce status and avoid privacy breaches.

Cartera Executive VP Jim Douglass is a believer in cultivating customer loyalty through hyper-relevant merchant offers that are card-linked to existing bank cards and tie into popular loyalty programs (airline miles, for instance) to motivate purchase. The company uses multiple sources of data to surface targeted deals that the merchant subsidizes only when consumers actually buy. Activity around the brand is then buttressed with deep analytics. “The payments and cards space is turning into an advertising business,” Douglass said.

Bundle is approaching the merchant loyalty space from a user perspective first, operating a consumer-facing site that analyzes credit card data to “rate merchants across several dimensions.” CEO Jaidev Shergill asserted that this enables unbiased views of restaurants that cut through the proverbial clutter of reviews sites such as Yelp. “You’re rating with your wallet.” Behavioral profiles are built, and lists created, that suggest other types of people who frequent specific restaurants, and where else they may go.

Whether it’s card-linked offers, purchase profiles, or points-driven perks, capturing, synthesizing and building actionable insights around data are the centerpieces of marrying loyalty and commerce, the next frontiers of both advertising and deals.

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Lisa DeSisto, chief advertising officer/GM of Boston.com, described how the Globe has divided is online product approach between the established Boston.com, one of the earliest successful city guides, and the new BostonGlobe.com, which is focused on premium (read paid) content. Unlimited digital access is $14.95 per month. For $14, you get digital plus the Sunday print edition. This provides some incentive to take the Sunday paper, which still carries a mother lode of ads. The new online edition was launched last fall and now has about 16,000 subscribers.

DeSisto said the decisions 16 years ago to avoid the Globe brand with Boston.com turned out to be a particularly good one, since it enabled it to come to market with two distinct online products.

Jeff Moriarty, VP, digital products, Boston Globe, described how the Globe’s Media Lab serves as an “ecosystem for innovation” for the newspaper. To bolster the spirit of innovation, the newspapers lends out space in the lab to start ups, roughly eight companies are operating there now. “The more smart people in the room, the better,” Moriarty says.

Twitter is key to how the Globe uses social media.

“Twitter has gone through the roof,” Moriarty said. “Our newsroom is truly real time. A story starts as a tweet, goes to a blog post and ends up in print.”

Some of the new social products that the Globe is experimenting with include a new service that Moriarty describes as a Twitter for events. Another service called Pulse does sentiment analysis around all the chatter what is flowing through Twitter or Facebook about everything Boston, included all of its rabidly followed sports teams.

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