Kris Chronister's

May 2009

Marketing is Dead. Long live Marketing.

I'll start with a controversial statement: Marketing as we know it is dying.

I was speaking with a colleague. A serious, seasoned, experienced, highly successful marketer - veteran of C-level roles in large companies with names that are familiar to all. Someone I flatter myself to even call a "peer." She threw out a statement that "I think this 'marketing' bit is over, it's gone, done for." I found myself agreeing with her.

You start with the long-standing issue of companies that run a "sales and marketing" department in their organization which, frankly, means "sales with a grandiose name." It's a decades long truism in the discipline that "Sales and Marketing" isn't.

But more and more, you see companies that are one way and another demoting or effectively eliminating "Marketing." They still do marketing, they just subsume it as a subsidiary sub-group beneath product management or sales or some other "major" discipline. I would also suggest that Marketing as an officer level role - the CMO - may have reached its apogee. The majority of companies, I would say, never did adopt a CMO even as the role gained some credibility, and many of those that did seem to be eliminating it (along with many other C_O titles beyond the entrenched CEO, COO, CFO triumvirate).

Concurrently, I found myself participating in an online discussion that asked folks to define marketing in one sentence. The definitions were highly varied, and I defined it as: "Marketing is the discipline of locating or creating convergences between customer/market needs/wants and a company's existing or deliverable solutions; then, communicating to that customer/market the availability and unique applicability of that solution to their need/want."

Shortly thereafter it hit me: Marketing - at least per my definition - isn't dying. Rather, marketers aren't doing marketing so much any more. I look at my colleagues, the groups I belong to, topics of conversation among marketers, presentations, white papers, etc. And it seems to me that "marketers" are focusing on the latter half of that definition to the detriment of the former. I see immense focus on the communications side in myriad variations. Hot topics include Social Network Marketing, Online Marketing, the viability (or not) of Traditional Media Marketing such as newspapers, TV and direct mail. Buzz Marketing, Affinity Marketing, yada.

The problem is this: Not only could you seamlessly replace the word "Marketing" in that list with "Advertising," it would in fact be MORE accurate after you did so. So despite the fact that calling a marketing professional "just" an advertiser is generally fightin' words, what I'm seeing is that the accusation sticks: it walks like a duck and talks like a duck...

So to my view, it's bad enough that Sales, Product Management, Research and the other disciplines have frequently taken over coordinating that market need/want versus company offering nexus. But it's worse that they have often not somehow usurped it: Rather, they've stepped into a vacuum.

What's it all mean? Heck, I dunno. But I will say that I agree with my colleague this far: IF "Marketing" allows itself to devolve into a mere glorified outbound communications "Advertising" mode and walks away from that need/fulfillment nexus where the real revenue driver lies, we will probably, one day, see the "Chief Product Officer" or the "Chief Sales Officer" become far more mainstream and common than the "Chief Marketing Officer."

April 2009

The Emperor Has No Clicks (and his clothes are looking pretty shabby too)

Okay, I'm calling it: Google is over the hump. It's in decline. It has jumped the shark, my friends.

Why do I say that? One clear reason: I realized today it has been weeks - possibly months - since I really found any good results from Google's search.

Is it the slavish preference for wikipedia, followed by .edu, .gov and .org links? Is it the dominance of inbound link "popularity" in site rankings? Is it simply that Google can no longer tweak its ranking algorithm fast enough to stay ahead of the site 'tuners'? I dunno.

What I know is that in search after search after search, I'm just not finding what I need from Google. I find lots of link farms, lots of not-quite-what-I-wanted .org and .edu sites, and invariably in the top spot, a link to Wikipedia. Guys, I'm aware of wikipedia - and aware of its weaknesses. I don't need a Google search result to remind me it's there (FWIW, which isn't usually that much IMHO).

What I'm looking for is there, all right. Eventually I can usually find what I need, but just not (any longer) through Google. Whether I'm trying to find a hardware store in my vicinity, a 20x25x5 furnace filter, or a good site to book cruises, Google just ain't delivering. Sometimes I find what I need through the sponsored links (more often than the organic!), but I know that's only a subset, so I don't 'trust' that it's a true result.

Oddly enough it's old, staid, counted-out Yahoo that I find delivering what I need most often. For a long time my.yahoo.com was my home page of choice. Even when igoogle.com debuted, I saw no real reason to switch. And while Yahoo embedding obnoxious unstoppable video ads in its "my" page was what spurred me to switch, in reality it was the search results that made the case.

So I'm taking a risk and predicting the 'outage' of Google in the next year or two. They're too big and too dominant to not remain a key player, but like Microsoft, I see a long slow slide away from the commanding lead they've enjoyed.

I remain eager to see who steps up to the plate. Will it be one of the second-tier players like Yahoo or AltaVista? Or some new upstart that finds the next great way to bring contextual relevance to search results? Personally, I'd bet on the latter. 'twill be fun to see in any case.

April 2009

The Dea(r)th of Customer Service

If you still think we're in a serious recession, just try to get your air conditioner fixed! The HVAC biz is apparently so awash in business that they don't want mine.

On Sunday our A/C was turned on for the first time with bad results - no cold air. So I called SECCO, the dominant local player and the folks that installed and serviced the equipment for the prior homeowner. They have a reputation for being "not cheap," but prompt and responsive. They said they could get out on Wednesday. So we sweated and slept badly for a few days, then I had to stick close to home on Wednesday, waiting... waiting... waiting... Nothing. At 2pm I called to see how we were doing and was told "well, you're on the list"... At 5pm, they called me and said "We'll have to reschedule you for next week." Next week? You gotta be kidding me.

So I called three other local HVAC outfits, all suggested by neighbors. Being after hours, I left messages. It's now 10am the next morning and only one of them has called back, and can't come until... Next week. I'm not going to hold my breath for the others to call at all... Mind you, in each case I've said that I not only want the system fixed, but want a service contract. You know... ongoing revenue for them?

Regardless - enough whining. The point is that I am regularly stunned at just how bad customer service is in our culture - in general. Having traveled the world extensively, it's just not like this in most other places. If you have money to spend and willingness to spend it, folks will bend over backward. Poor service is simply not tolerated. But somehow here we've learned to just grin and bear it.

So it serves as a regular reminder to me as to why I run Jackson GI the way I do. We respond to all customer inquiries quickly (24/7). We have a no-nonsense return policy. We bend over backward for customers and approach our customers from a "do the right thing" stance. And it does pay off... Our customers are happy and our absolutely stellar reorder rate proves it.

So thanks, SECCO. You'll never see one dime of business from me (I have a zero tolerance policy on wasting my time...), and I'll make sure to tell everyone I can to avoid you. But you did remind me, again, why I think of customer service as a core competitive advantage, not as a "call center" where we focus on minimizing costs.

March 2009

Flexing My Techie Muscles

My wife's recent entry into the real estate game gave me a chance to play techie in a way I haven't done in years.

I'm dating myself here, but the last time I dealt with domain issues beyond telling someone "get the MX changed on this domain" was so long ago... Netsol was the only game in town.

Flash forward and a challenge from Mrs. C: "I bought myself a passel of domain names. Can you make 'em all point to my website and incidentally, not have them show up as the "mugwump6247.terribledomainname.com" URL I've got assigned? And while you're at it, post 'em on your blog to get some initial Google coverage."

I withered in fear. I remembered the agonies of dealing with Network Solutions. Direct online change capabilities virtually nil. I anticipated days (weeks even) of waiting to see if messages sent off into the ether yielded results, nothing, or demands for notarized documents.

What a pleasure to play techie again it turned out to be. In the era of godaddy... well dang, this stuff is easy now! Sure, if I had a personal flunky to assign it to, I would have, but a couple hours effort and it's all done.

So check out how all the URLs now go to the site, nicely 'masked' to show the nice URL and everything. I suppose I take pleasure in the simple things sometimes. Maybe I should even break the old java & asp chops out from the back of my brain and try a little coding again. Could sure dress this site up a little, huh?

Anyhow, the fruits of my efforts and fulfillment of my wife's wish for her first inbound links...

Central PA Real Estate
Central Pennsylvania Real Estate
Camp Hill Real Estate
Harrisburg Real Estate
Cumberland County Real Estate
Andrea Chronister Sells Real Estate
Mechanicsburg Real Estate.

Yee haw! The old dude still has a few tricks. Now to go hire that personal flunky so I never have to do it again!

February 2009

Google: Dudes... Drop the self-righteous mission statement.

This one will be shorter than the norm, I think. But I've had enough of the self-righteous poseur-ship of Google. "Don't be Evil." Hah!

Here's the deal. Take a keyword on Google. One with NO ADS showing. Create an ad campaign focused on that keyword. Bid low for each click... $0.25, even $0.50.

Guess what... You'll get various messages in your adwords account: "ads not showing due to low quality score:" (not true, my landing page is HIGHLY relevant). Or best yet "Bid is below first-page estimate of $___" where ___ is always higher than my bid. What you won't get is your ad showing up.

C'mon guys. If you're going to have a minimum effective bid of $1 per click - which in my pretty extensive experience buying adwords is the realistic minimum - just say so and have done with it. Don't play all the games and nonsense. If NOBODY else is bidding on the keyword, $0.01 should be the position #1 ad, right? Don't tell me my ad is irrelevant when I buy "hot dog toppings" and have an entire site dedicated to a detailed review of hot dog toppings... Just flat out tell me - "It's $1 per click to play in our sandbox."

So gimme a break already. I can respect the profit motive - I have it myself! But at least be up-front about it and/or drop the whole "don't be evil" routine...

February 2009

Check out my New Blog

No, the marketing blog here is not going away, but with a new role at Jackson GI Medical on tap, I've started a new one focused on general business, particularly the healthcare industry, probiotics and prebiotics, and startup/small business in general at http://krischronister.blogspot.com. Check it out! More Marketing Meanderings coming here soon.

January 2009

Online marketing with the use of social network sites - Corporate genius or advertising spam?

Answer:

Jonathan: The conventional wisdom (at least currently) is that marketing on social networking sites is an unwelcome intrusion, and ineffective if not counterproductive. In my own blog, I've suggested that social networking sites have not proved fruitful in my own professional marketing endeavors (see link below for more on that).

And yet, I find my viewpoint shifting as these sort of sites mature and I observe what's being done.

To me, the key to any highly effective online marketing is a combination of traditional demographics - reaching the right person(s) - but with the added element of context: reaching the right person at the right time.

As an "oldster" in the realm of interactive marketing (ripe old age of 39, been "in the web biz" ~20 years since it was just a gleam of a SLIP connection in Al Gore's eye) I can suggest that this debate is part of a far larger discussion. That discussion started with whether advertising online was legitimate AT ALL. So let's bring perspective: In the earliest days of the web, advertising online in general was subject to the same critique. The web was much more the realm of academics and hobbyists then. Many folks payed per-kb or per-minute for access. Ads were seen as intrusive and unwelcome. Yahoo was still hosted on a Stanford web server, and sites like it and DEC's AltaVista (Google wasn't even around yet!) struggled with interrupting the "purity" of their searches with ads.

Ultimately, I think that Google's real secret sauce - what let them beat the pants off Yahoo and Altavista - was not just a simple interface and superior search algorithm, but the inspiration to add advertising contextually. The same user who lost his/her mind when receiving an irrelevant blast email about immigration lawyers or a blinking, obnoxious online ad for X10 cameras was not put out when typing in "cheap car insurance" on Google and having discreet Geico ads appearing.

I judge that social networks are in about that same 'adolescent' point in their development right now (and yes, I'm not sure the "google" of social networking has even appeared yet - s/he who monetizes will probably be the winner). And the debate is the same.

As a marketer more interested in results than a philosophical debate, I believe the trick to effective marketing on social networks is to get context. As someone else has pointed out here networking takes time... So does good marketing, generally.

I'm not sure if the facebook, linkedin or other sites' ad models support sufficient contextual or behavioral targeting at the moment. Facebook's claims to do so, but details are needed (and they haven't been real forthcoming with that "proprietary" information to this point...)

Moving outside the advertising world to "participating" in the sites on a corporate basis is much the same. If you add a profile or develop a facebook application, for instance, what value are you adding in what context? Are you investing the time to be a "responsible" participant or just trying to blast your name/product out there?

So Corporate Genius or Marketing Spam?

What's there is both. There's far too much of the latter, but some of the former. I know a local advertising agency that has launched some social network "profiles" for itself, along with some well-placed ads, and it's been a great source of leads for them - both business and personnel. But they respect the medium and work in a mode of adding contextual value and not overstepping their bounds.

Which one you as a marketer fall into is largely determined by how you approach it.

December 2008

Issues in Marketing to College Students

I was recently asked if I could identify some key issues in marketing to college students, based on my time as head of marketing for a student lending company, as well as various campaigns I did during my agency days which targeted the 17-24 on-campus crowd.

While the issues are multitudinous, a few items do stand out as particularly critical for education marketing. And as with most things marketing, we can gain a lot by looking at three critical factors: Audience, Message and Medium.

Audience

I know I said we’re talking about marketing to college students, but are you sure you’re marketing to the students? In many cases, you should be marketing to the parents instead of (or in addition to) the student.

Market analysis of today’s college-age audience identifies several characteristics. One particularly vital item to consider is a family characterized by “Heli-parents” or “SMothers” – highly involved, highly interested parents: perhaps even overly-so. The parents of today’s college student are the tail-end of the baby boom… “Generation Jones” born between 1955 and 1965. There are 69 Million of them, and they often have an overt desire to be “closer” with their kids and more “friends” with them than their parents were with them.

The students themselves? Well, take today’s date minus about 18 and you get right into it. The current "college crop" was born between the early 1980’s and 1990. They are the “MyPod Nation.” They are not “tech-savvy,” they are “Tech-Native.” They’re media-immersed, but they don’t define “media” as TV, radio and newspaper the way prior generations do. Media to them is content. It's medium-neutral. It can come online, on-demand, mobile, DVR’d, downloaded, posted on a blog, etc.

This creates quite a challenge. Do you divide and conquer – marketing to both sides, but thus dividing your marketing spend and focus and having to manage two audience groups and messages? Or, do you focus on parents or students as the initiator for a given product or service, and market to the other side in a supporting/close the deal way, if at all?

I believe there is no clear-cut answer, and it’s a case-by-case situation. Sure, you can make some judgment calls, guessing that MP3 player purchases are more likely to be student-driven, for example. But what if you’re wrong? What if a huge chunk of MP3 player purchases for students are primarily as gifts from parents? What if the student said “iPod” but the parents get talked into another type by the 19 year old sales geek (and a college student) at Best Buy who makes more commission on that one? Now you’ve got the student as initiator, but parent as key influencer who has to go along with it… A better tactic may be to ensure you address this issue precisely in your audience research for your product or service.

Message: The cool factor.

I think this is too-often overblown. Marketing to the college-age audience is seen as requiring so-hip-it-hurts trendy creative and messaging. And yet, I believe going for that is taking a big chance. My research repeatedly revealed that in trying to be edgy, the chances are great that you’ll be perceived as trying too hard, even laughable. “Looks like it was done by a 30-something trying to act cool” was a memorable comment from one round of focus groups I ran on a new interactive site for the college audience.

I have far too often seen “cool” as an excuse to violate basic marketing tenets. I remember a “viral video” campaign proposed by an agency that had absolutely nothing to do with the service we offered, absolutely no call to action, and no tracking embedded. It was strictly “show this cool video and then end with our logo on the screen.” Yeah, it was a fun video. Actually it was one of the funniest things I’ve ever seen… and I bet we could have got some serious viral play off it. But it made Microsoft’s extraordinarily short-lived Jerry Seinfeld ads look relevant and hard-hitting. Imagine a funny video about penguins “smoking” halibut and getting crazy at the south pole, followed by the OfficeMax logo… It was literally that disconnected - and the example is still off since, unlike Office Max, the brand involved had almost no recognition. I’m all for building brand recognition, but I like to do it in a way that has some relevance to what the brand offers.

The point is don’t forget your point. In the quest for new, different, hip, cool, funky – or whatever other synonym your creative director tosses out – don’t forget the basics: offer, value proposition, call to action, etc.

The medium is the message...?

Where you may want to pay attention to the “current trend” factor more is in your placement. You’ve heard of Facebook? MySpace? YouTube?... How quaint. In fact, here’s a recent story about how YouTube is losing market share. Remember Second Life and how many millions of marketing dollars went into building storefronts there? Me either.

Just assume that any interactive site you’ve heard of is last year’s news. Non-guided research is the answer here. Ask the students where they go and what they do there. For example, I’d be taking a long, hard look at Twitter right now, but figuring it’s only got 6-12 months before it becomes too mainstream.

Thinking of E-mail marketing? That’s “old people” stuff to college students. They might get e-mails from their professors or their “untechie” parents, but it’s not an “influence” channel. Direct Mail? You gotta be kidding me. Signage at the big college football stadium? Puuuhleaze. It goes back to audience. If you want to reach parents and/or alumni, those are some good venues.

Mobile applications. Texting. Videograms. All those things you’re not real comfy with. All those things you don’t quite get and aren’t sure how to leverage with marketing. All those things where you’re just not sure you quite get it… go there.

There is some good basic marketing to be had if you can get in the student mindset and get attached to what they want and use: Advertise on pizza boxes, offer a free latte at the local (non-chain) java joint, hand out laundry bags with your contact info, have cans of ‘energy drink’ custom printed with your info and distribute them. Basically: get embedded in the “Dorm Daze”. Your message and offer have to be relevant to your audience, but your medium and placement increasingly has to be relevant to their life too.

And don’t forget on-campus. Have you ever passed a student bulletin board where the various ride-share and room for rent flyers didn’t have a few ‘contact tabs’ pulled off? Where the black-and-white flyers with “interesting” artwork touting a local band’s gig at a local bar weren’t well worn (and frequently taken). Look, if a student whose ad budget consists of a “loaded” library copier-card is using it, it probably works.

Just respect the medium: Don’t hang up glossy 4-color posters with a URL and an 800 number. Put up 2-color stuff with tear-off tabs at the bottom, put a gum-bound pad of tear-off contact cards on it. This is where you can be edgy, funny or clever. Don’t say “highest rated student loan provider” or “The assistance you need to pay for your educational expenses”. And for goodness sake, drop the platitudes – I’ve seen enough posters showing ‘beautiful people’ with perfect white teeth wearing mortar boards under a headline with some variation of “We make your college dreams come true…” to last a lifetime – and I bet most college kids have too.

November 2008

My sales force is addicted to printed materials - to the tune of millions per year... What can I do?

Jim, I know exactly how you feel.. Been there, done that. There are many issues to confront in deciding on your own path forward:

Is it your sales force or your customers who prefer print? In many cases, the sales force will assure you the customer is demanding print. Easy enough to resolve: customer survey, ask them what they want, guess what... you'll likely find that for certain items, they really do want print. For catalogs in particular, customers just aren't quite ready to swap any kind of searchable database or e-catalog for a good old thumbable paper book with pictures and such. But for most other things... they'd love electronic: provided it's a good, usable solution.
What's the history? In many cases, "electronic" documents have a bad rep. Why? Because "electronic documents" too often means "Slap a PDF on a CD". Not exactly user-friendly or highly effective.
What kind of print? Are you talking about multi-hundred page catalogs, small brochures featuring targeted solutions, data sheets, promo sheets, info sheets, flyers, brochures, slicks, etc.? Your solution may depend on the format (see below)
Last but not least... What do you mean by millions? The conventional wisdom (supported by a few real studies) is that you spend $7-8 in additional costs for every $1 you spend actually printing. That's for wastage, warehousing, postage, carrying & handling, etc. And don't forget the opportunity cost of bad/outdated information conveyed through legacy print materials. That's probably not even included in that 1/7 ratio...

So the solution I've seen?

First and foremost, getting rid of print doesn't have to mean getting rid of print. For items where the customer really does want paper - especially smaller publications with a good potential for customization - consider using a smarter solution: Digital, on-demand printing through a global network. That means:

You only print what you need,
You avoid creating piles of legacy catalogs because you have to order huge quantities to offset rotary press setup costs,
You don't have to warehouse, stock or inventory anything,
As you update information, you can almost instantly update your materials printed from that moment forward,
You can absolutely track usage by rep (and customer) since you can make them order through an online interface.

This basically means you can now equate customer performance to materials/cost and get at something approaching a robust ROI.

You can even use a "points" system so that each sales rep gets a quarterly "budget."

Generally what you'll see is that - shockingly - all of a sudden each rep needs about 1/3 as much material. The other 2/3 of what we shipped out under the old system is probably still sitting gathering dust in sales reps' closets, garages and trunks... I've literally seen with my own eyes a sales rep's entire two-car garage converted into a library with multiple copies of every print item we've produced since he started ~25 years ago.

Second, a smart e-publishing solution. In my case, various customer research efforts have convinced me that this means something with three key features:

1) an on-screen presentation in a comfortable "double-page spread" format that visually looks like a book, including "page flip" navigation. Can't beat the power of familiarity.

2) a clean and clear keyword search capability.

3) Multi-platform distributability - able to be burned on CD, saved on thumb drive, e-mails, FTP'd, posted online, etc.

This is where format comes into it. You may want to use e-publishing for catalogs and large documents with digital-print-on-demand filling your need for brochures, flyers and other smaller-scale endeavors.

That's the solution... Implementation, education, acceptance and effective usage are the hurdles you should certainly not underestimage, though. But that'll have to wait for another blog entry, I think.

August-September 2008

CPM Again? "What's an acceptable click through rate?"

Answer: I'm going to take the contrarian viewpoint here and say it matters almost not at all. I say that for several reasons:

1) I would strongly prefer CPC or CPA based programs. I have found CPM to be wholly useless in most cases. Only in CPM does your clickthrough rate really matter much.

2) On a CPC basis (e.g. Google Adwords) clickthrough rate is often your enemy. While Google (and others) often build in clickthrough to your overall placement, I consider that basically insidious. The more you "juice" your copy to incent clickthrough, the more you (often) get junk clicks. In many ways, reducing your clickthrough rate will yield a better ROI (which is the metric I would say really matters in the end).

3) In a word (okay, an acronym, and one I just used) it's all about ROI. Who's better off? The campaign with 20% clickthrough and minimal ROI, or the campaign with 0.3% clickthrough and 2000% ROI? So many factors come into play here: What is your "win" for each completed transaction? How are you tracking ROI? etc. Measuring clickthrough as a success metric for online ads is rather like measuring hours worked as your metric of success for your career... It is often simply wrong, often irrelevant, and sometimes even an adverse indicator.

In the end, I most often find clickthrough rates touted by vendors/agencies who are not delivering ROI... Harsh? Perhaps. But also nearly invariably true in my experience.

January 2008

What's the most powerful response modifier you have tested (and measured!) on email marketing campaigns which has uplifted conversion? And why do you think it had an effect?

Answer:

For all the differences (which are critical to understand), at its core all direct individual-target marketing is driven by personalization/customization. If you're not leveraging the fact that you're communicating to an identifiable individual, you're losing much of the value of the mechanism. And I believe this applies equally to e-mail, direct mail, telemarketing or any other direct-to-one-individual medium.

So since you ask for "the" most powerful response, I'm not going to offer a laundry list here, but simply say "the" most powerful response modifier is personalization. As it applies to e-mail? Personalization in the subject line is a huge open-rate driver. Not just the basic "FIRSTNAME's Email Newsletter" routine, but whatever you can offer to create connection: E.g. "FIRSTNAME's Student Loan Information" is great. But if you have more detail, use it. Know where FIRSTNAME is going to college? Now you've got this: "FIRSTNAME's Student Loan at COLLEGE NAME for up to COLLEGE'S TUITION AMOUNT." Far better... Multiple hits on familiarity elements.

You could fairly say - and I'd agree - that personalization/customization of the subject line is the single most powerful response modifier. But if you choose to look at it more broadly, the same idea applies inside your e-mail too, once you've achieved the open.

And don't limit it to personalization to the individual. Every lever you can pull that ties to the individual is great, but more macro-level personalization works too. If you don't know details about the individual, what about the list parameters? For instance, If you're emailing a list in a given area or state, make sure you mention the area or state. "Bob, we're contacting homeowners about their mortgage options" is not nearly as good as "Bob, we're contacting Pennsylvania homeowners about their mortgage options" which is not as good as "Bob, as a select Camp Hill homeowner with an excellent credit history, COMPANY can offer you some compelling mortgage options."

I've tested many, many variants of this concept over many years in areas ranging from consumer finance to cars to jewelry, and it leads me to conclude that there is no such thing as too much personalization/customization. I've invariably seen that adding more will improve open, response and throughput rates.

December 2007

Is SEM Dying?

The question: "We all know that SEM is a continuous process, however are they some things within SEM which are getting obsolete....." (sic)

Answer:

No, it offers a unique value that shows no signs of abating:

SEM is currently the best way to find a synchronization between content-driven segmentation and behavior-driven targeting. Not only do you have a very good idea someone is a relevant target for topic X (based on the keywords), but you also know they are in a search mode for that content.

That's the exact problem with the current efforts to monetize Facebook, MySpace and the like. You frequently don't have content-specificity, and you certainly don't have behavioral context: It's not a search-based site. Marketing based on sheer demographics and nothing else... now THAT is a dying breed!

SEM has plenty of room to grow, in my opinion. It still represents only a small portion of ad spending, and has many untapped areas. For example, a genuine way to really add demographics to the mix would further enhance results. If I can not only tap an audience interested in "designer bathroom fixtures" and have a good idea they are actively seeking "designer bathroom fixtures" that's great (and that's SEM today). But if I can also know that they are 50-65 year old empty nesters who are a better target for my super-high-end bathroom fixtures, that's some magic in the making!

Until something comes along which even better synchronizes audience segmentation with behavioral context, SEM will continue to grow.

PS - Anyone who knows what that "something" is, drop me a line. We'll make a LOT of money.

November 2007

Do Banner Ads Work?

(Asked by Karl Philip Lund, LinkedIn.com, Nov. 5 2007... Thanks, Karl)

The question: Do Banner Ads Work? Jakob Nielsen recently as study about banner blindness. If nobody sees banners, do they work? Can anybody point me to a banneradvertising success story? (sic)

Answer:

Banner ads are just no fun, they do not work well, Mr. Lund.
I do not like those banner ads, I do not like them - even scads
17 Years, Jag to ConAgra. Banner ads need some Viagra!
I have tried them 'cuz the agency said so, I tried them and the budget bled so.

I have tried them for my clients: Impact not measurable by science.
I have tested millions of bucks, I have tested – they just sucks!
I will not test them here or there, I will not test them anywhere.
I have tried some context buys, I have made behavioral tries.

Video embedding I have done, audio too – sales, not one!
I used them for teens on myspaces, I used them for seniors other places.
Young and old, all alike. Banner ads they just don’t like!
AOL did not work well, on Yahoo too they did not sell.

I will not make a banner run, I will not use them, Mr. Lund.
Careful placement or Run of Site. Didn’t get a single bite.
Integrated with TV, Good results I did not see.
Cross promotions, I have tried. Clicks and conversions...died.

Branding, Branding say the pros. Brand awareness at all-time lows.
"Strategy lacks” says agency, but CPA pricing they will not see!
“Creative weak” the websites say, but pay-for-results makes them run away.
Green Eggs and Ham or Banner run? I’ll take the breakfast, Mr. Lund.

October 2007

5 reasons why Yahoo WILL win more marketshare in 2008. Agree?

The Question: Yahoo!'s numbers this week have been given rather lukewarm response from analysts and investors alike; however I believe 2008 will see a rising Yahoo win back significant marketshare from Google.

5 reasons why Yahoo will boom in 2008 are -

(1) Yahoo!'s search algorithm is the best its been; and the rate its growing and quality its producing; it will match Google for quality by the end of 2008.
(2) Yahoo! Answers moves onto mobile with OneSearch; and continues its 50% year-on-year growth; Answers and becomes its own revenue stream.
(3) For the past month Yahoo! has focused on improving the click quality of its content network; this leads to increasing conversions and distribution; this leads to happier advertisers.
(4) The New Yahoo! PPC system tweaks make placing adverts on the network a lot easier.
(5) Yahoo will buy Facebook; (its been touting it for too long now) adding to Yahoo! Answers it now controls two major advert distribution networks.

Agree or am I talking nonsense and this is just another false dawn for Yahoo?

Thoughts please.

Answer:

UPDATE as of January 2009: The dismal year of 2008 is well and truly behind us. And with hindsight, we have our answer... Yahoo did not "Boom" in 2008. Quite the reverse: with a board conflict, ouster of founding CEO Jerry Yang, a final end to the talk of Microsoft investment or buyout (okay, okey...for now), and a new CEO pending, it wasn't a "growth" year for Yahoo. If anything, their position is more tenuous than ever. My Original Answer from Oct. 2007 follows:

Nope, won't matter.

Gains 1-4 you note above are HIGHLY incremental and will not 'move the needle' in terms of impacting the user experience (whether we mean a website user or an advertiser user). I'm all for step-by-step steady improvement. That is key to staying competitive, retaining market share, and building retention. But it's not a quantum growth driver. The only way Yahoo will gain significant market share is by shaking up the entire model and coming up with something that is a whole new take on search/portal conceptions. I don't see any of that here.

The exception to the 'incremental' argument is Facebook. Acquiring that would clearly be more than an incremental step. Yet it's still not going to help. I concur with many of the comments here that "content network" based advertising is marginal - and really, that's all Facebook is - a loosely organized and focused, largely user-driven content site. The advertising I have done on Facebook has been among the worst-performing I've ever seen in nearly 20 years doing online marketing.
Why? I think it's behavioral context. Facebook is about social networking. People are going there precisely for leisure/escapist reasons. You can show them advertising and messaging 100% dead-on to their needs, and they'll ignore it because they are focused on a totally different behavior path. The reason CPC works so well is the combination of targeting (you respond to the user-defined search) AND behavioral context (they are there precisely because they are in information-seeking mode). No content play can match that, and especially not one where the context is exactly antithetical to marketing.

Addendum: On October 25th, 2007 Microsoft announced a $240 M investment in Facebook. As a company primarily focused on software "infrastructure" this makes far more sense, I think, than an investment by Yahoo (or Google, for that matter).

September 2007

To what extent do offline conversions factor into your PPC management decisions?

1) Do you think the market for PPC ads has already discounted the value of offline conversions?

2) Do you presently monitor off line leads/sales and integrate that data back into your search engine cost data, ultimately revising upward your ROAS and reducing your CPA/CPO? What solution do you use? Do you go so far as adjusting for bad debts/returns?

3) If you're not presently adjusting for that, what % of sales need to occur offline to render managing CPA/CPO goals with only online success data an inherently flawed and potentially wasteful practice?

Answer:

1) Not at all. I think PPC rates, especially when we're talking bidding-based models, are very immediate-ROI driven. Fundamentally, I believe that is driven by the preponderance of PPC customers who simply lack the infrastructure, process, or resources in place to effectively track this.

2) Yes. Over the long term our metrics are driven by sales per click, with the key caveat that we continue to monitor and track this over time. Over time, we can infer a ratio of immediate conversion to "total" conversion and base bidding and budget on that. Bad debt/cancellation/return is included in this. Our solution ties a 'source' code to a user registration, preserving the origination of that lead to all their ultimate activities. For indirect/offline transaction, all customers must answer a how-did-you-hear-about-us query. Given the time and effort devoted to making that representative and effective, I actually consider the precise method used as highly proprietary! In fact, because the 'source of origin' is tagged onto a customer on a permanent basis, we even include repeat business by the given customer over the long term.

3) Can't answer this exactly as posed since we do track this, but would venture that 30-33% of the total value of a "click" happens offline and/or within subsequent business. Clearly that number is highly variable based on the individual business's ability to serialize. Some products are one-time, some are cradle-to-grave, and that impacts significantly.”

August 2007

If you knew the exact duplication rate of orders being attributed to Affiliates, Search and Media (double and triple counting primary influencer), how would you change your campaign strategy?

Answer:

“On a bottom-line, objective level, If I definitively knew the entire "clickstream" I would allocate the ROI to all the "involved" placements/media. I'm not entirely sure there's more to be done than that. One creates familiarity, inclusion in the decision set, and propensity to engage through a multi-touchpoint halo effect that creates a customer. However, I doubt there are any secret shortcuts or uber-drivers in that 'halo.' The aggregation of awareness, the sequence of media impressions to action and the interplay of multiple engagement points is so subjective and so personal to each prospect that I would only "mess with the works" very carefully and lightly, even if I did know the exact touchpoints and sequence.”

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Prior Postings

Apr. 2009

The Emperor Has No Clicks

Apr. 2009

The Dea(r)th of Customer Service

Mar. 2009

Flexing my Techie Muscles.

Feb. 2009

Check out my new blog.

Jan. 2009

Update with hindsight: Will Yahoo! win more market share in 2008?