Online Marketing

“Fanning out” when it comes to brands and social media engagement.

Phillip Nones Uncategorized , , , , , , , , , , ,

Social media may well be taking the famous 90-9-1 principle of online engagement … and bringing it to new lows.

It’s hard not to come to this conclusion when reviewing the results of research conducted by the Ehrenberg-Bass Institute for Marketing Science. This Australian-based University think-tank studied the actual engagement levels of people who have “liked” the top 200 brands on Facebook by considering the degree to which fans actually shared posts or commented on the brand.

Over a six-week period of study, Ehrenberg-Bass found that fewer than one half of one percent of the brand fans actually “engaged” in any way at all.

The conclusion? It turns out that social media fan bases and actual engagement are two very different things.

Categories that do somewhat better in “engagement” are ones like alcohol, cars and electronics. But interestingly enough, the study also found that the so-called “passion” brands – such as Harley-Davidson, Porsche or Nike – don’t perform much better than “regular” brands: 0.66% engagement versus 0.35%.

In its report conclusions, Ehrenburg-Bass questions whether the Herculean efforts being made by some brands to “bribe” their way to thousands of “fans” and “likes” is really worth the cost in terms of the added product discounts, coupons and other goodies that are being proffered to entice consumers to become brand fans.

When you boil it down, the Ehrenburg-Bass research confirms yet again a basic truism about branding: Much as we would love to think otherwise, the marketplace isn’t nearly as enamored with our brands and products as we think they should be.

To us, the branding so important. To them … it’s just one big shrug of the shoulders.

Online coupon deals: Take those “whopping” discounts with a grain of salt.

Phillip Nones Uncategorized , , , , , , , , ,

Online daily deals save you less than you might think.
That "big discount" you think you're getting? Chances are, it's based on inflating the regular price.
In the world of retail, while the way people buy goods and services may be evolving at a rapid clip, it turns out that some aspects have changed nary a bit.

Take online couponing. Groupon and LivingSocial are the two big players in this segment, which enables consumers to take advantage of deep discounts on products or services providing enough people sign up for the offer. They’ve been proliferating in retail markets all over the country.

But think back to the “bad old days” of brick-and-mortar retail. Often, you might encounter a “deep discount” at a grocery store or big box store, only to realize later that the discount was calculated off of an unrealistically high list price for the item.

While not illegal, such practices are certainly deceptive, in that the product was rarely if ever sold at the “standard” price.

Well, guess what? When looking at online coupon deals, we’re now finding the very same practices at work.

Recently, local local services online directory Thumbtack contacted vendors offering daily deals from Groupon or LivingSocial. Vendors were “shopped” in metro markets all across the country that included a variety of services ranging from home cleaning and maid services to interior painting, handyman services and studio photography.

In eight out of ten cases, Thumbtack found that it was quoted a price over the phone that was lower than the advertised “regular” price cited in the supposedly “great” deals being offered.

Two examples:

 On September 19, 2011, Groupon offered two hours of home cleaning services in Phoenix, AZ for $49 … an amount it claimed was 67% off of the “regular” price of $150. When contacted by phone, the non-discounted price for the exact same cleaning services was $80. So the consumer was still getting a discount … but hardly the 67% as breathlessly claimed.

 On August 24, 2011, Groupon offered carpet cleaning services for a 200 sq. ft. area in San Francisco, CA for $45 — purportedly a 78% discount from the regular price of $200. The price quoted over the phone for similar square footage? Just $106. No doubt, Groupon, LivingSocial and their participating vendors realize that one way to make an offer more attractive is to make sure the percentage discount is huge – and thus unlikely to be offered again.

It’s really no different from practices we’ve seen used in retail over many years. But as more consumers become more savvy to the ways of online deals, it’s quite likely that we’ll find fewer people choosing to participate in them based on the “whopping” discounts claimed.

ICANN’s Brand-Named Internet Domain Scheme Encounters Strong Resistance

Phillip Nones Uncategorized , , , , , , , , , ,

The ANA and others are trying to stop ICANN from implementing its new brand-named Internet domain plan.In late June, I blogged about the proposed new initiative by the Internet Corporation for Assigned Names and Numbers (ICANN) to broaden top-level domain names to include the use of company- or brand-name suffixes.

The idea is that famous brands could begin using their well-known monikers to further distinguish their activities on the Internet. ICANN’s spokespeople are on record claiming that the new guidelines will “usher in a new Internet age.”

Well … not so fast. The more people have been looking into this scheme, the less they like it. One of the biggest issues is the “pay to play” aspect. Unlike the days when people could purchase a domain name for just a few dollars … then squat on it until someone was willing to pay hundreds of thousands to use it, the cost to secure a new domain suffix like .pepsi or .hyundai will start at ~$185,000 … and go up from there.

That’s not chump change. But here’s the thing: For securing a famous brand name as a top-level domain name, it still represents a dandy opportunity for someone with funding (or a group of investors) to nab the “best brands” early on … then hold out to resell then name for a smart sum far greater than what they paid.

Which puts the onus back on the large companies who will feel compelled to pay the $185,000+ right off the bat – even if they have no intention of using the top-level domain name now or ever.

So it’s a very nice revenue stream to ICANN, ponied up by major international companies who don’t want the risk of having their names “hijacked” by someone bent on extortion – or worse, nefarious brand doings.

The concern is so great that the Association of National Advertisers, an organization made up of large national/international brand marketers, has issued an official communication to ICANN, warning that its scheme could have “potentially disastrous consequences” for marketers if the plan is implemented as proposed.

The letter also states that the ICANN scheme is likely to cause “irreparable harm and damage” to marketers, even as it “contravenes the legal rights of brand owners” and “jeopardizes the safety of consumers.”

Bob Liodice, president of ANA, has gone further in criticism of the ICANN proposal. “The decision to go forward with the program also violates sound public policy and contravenes ICANN’s Code of Conduct and its undertaking with the United States Department of Commerce,” he emphasizes.

Liodice contends that if the ICANN plan moves forward, it would create an ugly free-for-all environment in which many brand marketers would need to divert legal, financial and technical resources to applying for, managing and protecting their top-level domains … or risk the consequences.

“They are essentially being forced to buy their own brands from ICANN at an initial price of $185,000,” Liodice points out.

The sharp criticism of the plan ensures that these issues aren’t anywhere close to being resolved – and it probably puts ICANN’s anticipated January program launch date in question.

Stay tuned … ’cause it’s going to be a wild ride over the next few months!

Big Branding News on the Internet Domain Name Front

Phillip Nones Uncategorized , , , , , , , , , , , , , , , , , , , , , , , ,

ICANN logoIt was only a matter of time. Internet domain names are now poised to move to a new level of branding sophistication.

This past week, the Internet Corporation for Assigned Names and Numbers (ICANN) decided to broaden domain name suffixes to encompass pretty much anything. Instead of being restricted to suffixes like .com and .net that we’re so used to seeing, beginning in January 2012, companies will be able to apply for the use of any suffix.

At one level, there’s a practical reason for the change in policy. As happened with telephone lines in an earlier era when a host of new FAX numbers and cellphones came onstream, the inventory of available web addresses under the original system of .com, .edu, .gov and .org has been drying up. Recent moves to authorize the use of .biz, .us and .xxx have been merely stopgap measures that have done little to alleviate the pending inventory crunch.

But the latest ICANN move will likely have ripple effects that go well beyond the practical issue of available web addresses. Industry observers anticipate that the new policies will unleash a flurry of branding activity as leading companies apply for the right to use their own brand names as suffixes.

In fact, Peter Dengate Thrush, chairman of ICANN’s board of directors, believes the move will “usher in a new Internet age.”

It’s expected that major consumer brands like Coca Cola and Toyota will be among the first to nab new domain suffixes like .coke or .toyota.

It’s a natural tactic for companies to employ as a defensive step against unscrupulous use of their brand names by other parties. But it’s also an effective way to gain more control over their overall online web presence via the ability to send visitors more directly to various portions of their world in cyberspace.

Of course, we can’t expect these new suffixes to be acquired on the cheap. Gone are the days when someone could purchase an address like “weather.com” for a just few dollars … and then sell it later on for hundreds of thousands.

In fact, it’s being reported by the Los Angeles Times that the cost to secure a new domain will be in the neighborhood of $185,000 – hardly chump change. At that price tag, only well-established organizations will be in a position to apply – and those applications must also be able to show that they have the technical capabilities to keep the domain running. So no cyber-squatters need apply.

Bloomberg Businessweek predicts that leading companies may invest upwards of $500,000 each to secure their brand identities online and to prevent them from being “hijacked” by others. It certainly gives a fresh new meaning to the term “eminent domain”!

Online Display Ad Effectiveness: Skepticism Persists

Phillip Nones Uncategorized , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Online Display AdvertisingAs the variety of options for online advertising have steadily increased over the years, the reputation of display advertising effectiveness has suffered. Part of this is in the statistics: abysmal clickthrough rates on many online display ads with percentages that trend toward the microscopic.

But another part is just plain intuition. People understand that when folks go online, they’re usually on a mission – whether it’s information-seeking, looking for products to purchase, or avocational pursuits.

Simply put, the “dynamic” is different than magazines, television or radio — although any advertiser will tell you that those media options also have their share of challenges in getting people to take notice and then to take action.

The perception that online display advertising is a “bad” investment when compared to search engine marketing is what’s given Google its stratospheric revenue growth and profits in recent years. And that makes sense; what better time to pop up on the screen than when someone has punched in a search term that relates to your product or service?

In the B-to-B field, the knock against display advertising is even stronger than in the consumer realm. In the business world, people have even less time or inclination to be distracted by advertising that could take them away from their mission at hand.

It doesn’t take a swath of eye-tracking studies to prove that most B-to-B practitioners have their blinders on to filter out extraneous “noise” when they’re in information-seeking mode.

This isn’t to say that B-to-B online display advertising isn’t occurring. In fact, in a new study titled Making Online Display Marketing Work for B2B, marketing research and consulting firm Forrester Research, Inc. reports that about seven in ten B-to-B interactive marketers employ online display advertising to some degree in their promotional programs.

And they do so for the same reasons that compelled these comparnies to advertise in print trade magazines in the past. According to the Forrester report, the primary objectives for online display advertising include:

 Increase brand awareness: ~49% of respondents
 Lead generation: ~46%
 Reaching key target audiences: ~46%
 Driving direct sales: ~41%

But here’s a major rub: Attitudes toward B-to-B online display advertising are pretty negative — and that definitely extends to the ad exchanges and ad networks serving the ads. Moreover, most don’t foresee any increased effectiveness in the coming years.

That may explain why Forrester found that fewer than 15% of the participants in its study reported that they have increased their online display advertising budgets in 2011 compared to 2010 – even as advertising budgets have trended upward overall.

When you look closer at display, there’s actually some interesting movement. Google has committed to a ~$390 million acquisition of display ad company Admeld. And regardless of the negative perceptions that may be out there, Google’s Ad Exchange and Yahoo’s Right Media platforms have created the ability for advertisers to bid on ad inventories based on their value to them.

Moreover, new capabilities make it easier to measure and attribute the impact of various media touchpoints — online display as well as others — that ultimately lead to conversion or sales.

But the negative perceptions about online display advertising continue, proving again that attitudes are hard to change — even in the quickly evolving world of digital advertising.

Click Wars Opening Round: Plaintiffs 1; Facebook 0

Phillip Nones Uncategorized , , , , , , , , , , , , , , , , , , , , , , , , , ,

I’ve blogged before about the issue of click fraud, which has many companies wondering what portion of their pay-per-click campaigns are simply wasted effort.

Until now, Google has been the biggest target of blame … but now we’re seeing Facebook in the thick of it also.

It’s only been in the past year that Facebook has made a real run for the money when it comes to paid search advertising. There are some very positive aspects to Facebook’s advertising program, which can target where ads are served based on behavioral and psychographic factors from the Facebook profiles of members and their friend networks. This is something Google has had a difficult time emulating. (Not that they haven’t been trying … which is what the new Google +1 beta offering is all about.)

But now, Facebook is the target of a lawsuit from a number of advertisers who contend that there are major discrepancies between Facebook’s click volume and the companies’ own analytics programs which suggest that the purported clickthrough activity is significantly inflated.

As an example of one company that is a party to the lawsuit, sports fan site RootZoo alleges that on a single day in June 2010, its software programs reported ~300 clicks generated by Facebook … but Facebook charged RootZoo for ~800 clicks instead.

While contesting the allegations vigorously, Facebook’s attorneys have also argued against the company having to disclose the source code or other details of how it calculates clickthrough activity, citing fears that the proprietary information could be leaked to outside parties (competitors) as well.

But that argument fell on deaf ears this past week. Instead, Facebook has been ordered by the U.S. District Court in San Jose, CA to disclose a wide range of data, including its source code for systems to identify and filter out invalid clicks.

In making this decision, Magistrate Judge Howard Lloyd stated, “The source code in this case implemented Facebook’s desired filtering, and whether that filtering [has] lived up to Facebook’s claims and contractual obligations is the issue here.”

This ruling appears to call into question the sweeping terms and conditions that Facebook advertisers are required to sign before beginning a media program. The relevant language states: “I understand that third parties may generate impressions, clicks or other actions affecting the cost of the advertising for fraudulent or improper purposes, and I accept the risk of any such impressions, clicks or other actions.”

[This isn’t the only incidence of Facebook’s broad and restrictive stipulations; another particularly obnoxious one deals with “ownership” of content posted on Facebook pages – basically, the content creator gives up all rights of control — even if the content came to Facebook through a third-party source.]

But in this particular case, evidently the terms and conditions language isn’t sweeping enough, as Judge Lloyd ruled that the plaintiffs can sue on the basis of “invalid” clicks, if not “fraudulent” ones.

Touché! Score one for the judges against the lawyers!

Of course, it’s way too soon to know how this particular case is going to play out – or whether it’ll even get to court. It’s far more likely that Facebook will settle with the plaintiffs so as not to have to disclose its source code and other “trade secrets” — the very things that cause so many marketers to see paid search advertising as a gigantic black hole of mystery that is rigged against the advertisers no matter what.

But one thing is easy to predict: This won’t be the last time the issue of pay-per-click advertising is brought before the courts. Whether the target is Facebook, Google or Bing, these skirmishes are bound to be part of the business landscape for months and years to come.

E-mail early birds? The worm may be turning differently.

Phillip Nones Uncategorized , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Best time to deploy marketing e-mail messages.One of the great benefits of the “online everything” world in which we now live is the ability to evaluate nearly anything about marketing not with hunches or speculation, but with hard data.

A perennial question is what time of day is best to deploy marketing e-mails to customers and prospects. The higher the propensity to open and read these messages, you’re closer to the goal of converting eyeballs to clickthroughs … and to sales.

ReachMail, a Chicago-based e-mail service provider, recently studied a large sampling (~650,000) of the millions of consumer and business marketing e-mail messages it sends out for clients daily in order to determine open rate differences based on the time of day. It normalized the data to account for different time zones.

What ReachMail found was that there are differing peak open rate times on weekends versus on weekdays:

 Weekdays: Peak e-mail open rates are between ~11:30 am and ~2:00 pm.

 Weekends: E-mail open rates begin trending upward at ~11:30 am, but don’t peak until ~4:00 pm.

John Murphy, ReachMail’s president, had this to say about people’s weekday e-mail open rate behaviors: “You would think it would spike in the morning, but they’re looking at work e-mails in the morning. Once they’ve cleared out their inbox, they’re looking at marketing e-mails in the afternoon.”

ReachMail’s conclusion: It’s best to deploy weekday e-mails between 10:00 am and Noon. For weekend e-mails, deploy them between Noon and 3:00 pm.

And this additional tidbit also: Don’t assume e-mails sent during the week will perform better than those deployed over the weekend. “People’s engagement rates are up there on the weekend,” Murphy maintains. “It’s our habit of checking e-mail all the time.”

He’s sure right about that.

Online Display Ad Clickthrough Rates Finally Bottom Out … Near the Bottom

Phillip Nones Uncategorized , , , , , , , , , , , , , , , , , , , , , , , ,

Online Display Ad Clickthrough Rates Bottoming Out
Online display ad clickthrough rates have stopped declining ... bottoming out at 0.09%.
The latest news in online display advertising is that ad clickthrough rates have now leveled off after an extended period of decline – one that was exacerbated by the economic downturn.

So reports digital media marketing firm MediaMind (Eyeblaster). According to a report released this past week, one key reason for the decline being arrested is the greater sophistication of advertisers in targeting online advertising to audiences and groups that are more likely to be interested in them.

That being said, the overall clickthrough rate has leveled off at an abysmal 0.09%.

That is correct: less than one tenth of one percent. In any other business, this would be a rounding error.

If that statistic seems difficult to believe, consider this factoid: The average Internet user in America is delivered more than 2,000 display ads over the course of a single month. We might think that users would be inclined to click on more than just two or three of these ads during a month’s time.

But it’s important to realize that when users are in the mood to shop and buy, they’re typically going straight to the sites they like … or they’re using Google, Bing or some other search engine to find their way.

And it turns out there’s really no such thing as an “average” Internet user, anyway. Research conducted by digital marketing auditing and intelligence firm comScore, Inc. has found that around two-thirds of people on the Internet never click on any display ads during the course of a month. Moreover, only 16% of Internet users are responsible for around 80% of all clicks on display ads.

All the more reason why search marketing continues to be the online advertising powerhouse that it is. And why not? It’s putting your business in front of the customer when s/he is in “search-and-buy” mode … not when s/he’s doing something else.

Search Goes Global

Phillip Nones Uncategorized , , , , , , , , , , , , , , , , , , , , , , , ,

SEO in Different LanguagesMost companies hitched their wagon to search engine optimization long ago. That’s not surprising, because high search rankings are one of the most effective ways to get in front of customers and prospects when they’re in the mood to research and buy.

But up until recently, SEO has generally existed in the world of English. By contrast, SEO campaigns in Spanish and other languages haven’t worked so well. Despite the fact that Spanish is among the most widely spoken of languages, many Spanish-language countries have been behind the curve in Internet connectivity. And you could say the same of other languages.

But that’s not the case today. As more people overseas have become connected, the amount of content in Spanish and other foreign languages has risen dramatically.

Looking back at a bit of history, in the early-1990s essentially all of the search engines were in English only; if you wanted to conduct a web search, you had no other choice. That started to change by the mid-1990s when ~75% of all Internet searches were being conducted in English.

Fast-forward to today. According to Internet World Stats, an information resource that chronicles web usage in more than 230 countries and world regions, searches in English now account for only ~25% of all searches conducted.

Time was … search spoke English only. But the dramatic growth of Hispanic and other non-English digital markets means that companies that take the time to invest in foreign-language content and SEO initiatives will find themselves in the strongest position going forward.

It’s yet another item for the marketing department’s to-do list. Fortunately, help is available … with companies like MSEO.com and SEO Matador providing turnkey programs for implementing SEO campaigns in multiple different languages.

Bing, Blekko, and more new developments in search.

Phillip Nones Uncategorized , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Facebook + BingWhen it comes to the evolution of online search, as one wag put it, “If you drop your pencil, you miss a week.”

It does seem that significant new developments in search crop up almost monthly – each one having the potential to up-end the tactics and techniques that harried companies attempt to put in place to keep up with the latest methods to target and influence customers. It’s simply not possible to bury your head in the sand, even if you wanted to.

Two of the newest developments in search include the introduction of a beta version of the new Blekko search engine with its built-in focus on SEO analytics — I’ll save that topic for a future blog post — along with a joint press conference held last week by Facebook and Microsoft where they announced new functionalities to the Bing search engine. More specifically, Bing will now be displaying search results based on the experiences and preferences of people’s Facebook friends.

What makes the Bing/Facebook development particularly intriguing is that it adds a dimension to search that is genuinely new and different. Up until now, every consumer had his or her “search engine of choice” based on any number of reasons or preferences. But generally speaking, that preference wouldn’t be based on the content of the search results. That’s because the ability for search engines to deliver truly unique search results has been very difficult because they’ve all been based on essentially the same search algorithms.

[To prove the point, run the same search term on Yahoo and Google, and you’ll likely see natural search results are pretty similar one to another. There might be a different mix of image and video results, but generally speaking, the results are based on the same “crawling” capabilities of search bots.]

The Bing/Facebook deal changes the paradigm in that new information heretofore residing behind Facebook’s wall will now be visible to selected searchers.

The implications of this are pretty interesting to contemplate. It’s one thing for people to read reviews or ratings written by total strangers about a restaurant or store on a site like Yelp. But now, if someone sees “likes,” ratings or comments from their Facebook friends, those will presumably carry more weight. With this new font of information, as time goes on the number of products, brands and services that people will be rating will surely rise.

The implications are potentially enormous. Brands like Zappos have grown in popularity, and in consumer loyalty, because of their “authenticity.” The new Bing/Facebook module will provide ways for smaller brands to engender similar fierce loyalty on a smaller scale … without having to make the same huge brand-building commitment.

Of course, there’s a flip side to this. A company’s product had better be good … or else all of those hoped-for positive ratings and reviews could turn out to be the exact opposite!