business zone

How Are Your Customers Behaving?

A new post for Business Zone.businesszoneHop into my Tardis, I want to take you back to those heady, glorious, recession-free days of 2007.Two of the largest deals that year were based around advertising. Google acquired online ad company Double Click for a $3bn. In the meantime, and keen not to be left out, Microsoft stumped up $250 million for a less than 2% share in FaceBook. Sure, these figures seem a little crazy today, but the truth is that online marketing really works.Last year, online marketing accounted for 25% of total UK advertising outlay. Back in 2007 when those deals were going through, the British business was spending £3bn a year in this space. Now, in the midst of a recession, companies look like they will shell out more than £5bn. In 2008 Google made nearly $20bn just from advertising. That’s $50 for each man, woman and child in the US!It is clear our appetite for online marketing is only getting bigger, but what are the current trends?The hot technique at the moment focuses around behavioural targeting. In layman’s terms, you make your advertising more effective by targeting only those that are most likely to buy. It’s nothing new. There is a reason adverts for feminine hygiene products appear during Judge Judy and you don’t see them on reruns of Top Gear on “Dave”.As a former website developer I used to spend hours dedicated to SEO. It is hard work and doesn’t always cut it. As a result, and especially in the world of ecommerce, PPC schemes continue to blow natural search out of the water.Within this market Google doesn’t just dominate, it obliterates. However, if Google is Goliath, FaceBook is certainly making an attempt to be David. If it’s not doing so already, I believe FaceBook advertising will put a serious dent in Google's finances. Looking at the HitWise reports for last month, one in every 20 UK web visitors ended up on Facebook. That’s staggering.So, how do FaceBook ads stack up against Google?I recently experimented with a five-day ad campaign on FaceBook as well as the more traditional PPC schemes of MSN and Google. This is my third attempt at advertising on FaceBook, and I am happy to report that it has significantly moved forward.The very first thing to notice is the ability to segment your advertising into demographics. Usefully, the merchant I was testing this for had spent a lot of time analysing product sales and speaking to customers, and knew his core market - UK males aged between 20 and 30.The budget for this experiment was low, but looking at the results, FaceBook managed to serve up ads a phenomenal number of times. In fact, I was frankly staggered that it was around one thousand times more than traditional PPC. The result is that both the average cost per click and the cost of visitor acquisition are significantly lower when compared with Google.Diving a little into the results, I was very keen to understand just what had happened. Analytics tells me the visitors spent about two minutes on the merchant site. However the key stat turns out to be the percentage of visitors that instantly left the site, the bounce rate. Bounces from FaceBook visitors were 50% less than Google and 60% less than MSN!The answer is simple; It’s all about behavioural targeting. FaceBook is delivering adverts to the most relevant people. No wonder Google wants to know more about all of its visitors!So, looking back at 2007 again, maybe that $250M was the more sensible investment.

Ring Ring goes the .Tel-ephone

businesszoneOriginally written for Business Zone.The internet is awash with hundreds of zany domain names. We all instantly recognise the Top Level Domain (TLD) extensions such as .com and .co.uk, but the spectrum goes all the way from .au (Australia) via .tv (the Pacific island nation of Tuvalu) to .name and .pro. Joining the party is the recently launched domain extension .tel from a company called Telnic. The question has to be asked whether we need another TLD, and what is it for?Firstly, is that this isn't your regular domain name. Unlike its traditional counterparts the .tel domain is not for hosting web sites, instead Telnic is trying to create a contact book for the web. The domain allows you to store and publish your contact information (including social networking details), along with relevant keywords, all under a single identity. This information is stored in the many DNS (Domain Name System) servers around the world. Telnic calls it the 'webless web'.This idea is pretty smart; DNS is a universally accepted protocol and the founding cornerstone of the web as we know it today. To put it simply, it's a format that can be read by any web-connected device on the planet.Looking at my email signature, I have four contact telephone numbers, an email address, business and personal web pages, Skype and Twitter IDs. The list seems to go on for ever. The problem is that I can never remember them all, and if anything changes it's a nightmare. The .tel domain brings all of this contact information together. All I have to remember is bdyer.tel.So, what is it going to be used for?Potentially the opportunities are endless, especially in the mobile and physical meeting space. Using .tel as an electronic ID for exchanging contact information might be the final straw that breaks the back of the business card, saving a lot of trees in the process.The domain also has a number of interesting side effects, an unexpected one being in connection with Search Engine Optimisation (SEO). Due to the very nature of the domain, you associate your contact details with keywords and all of this content is machine-readable. This up-to-date information is invaluable to search engines because it comes from a central trusted authority (Telnic) which search engines consider highly relevant.It's still early days to decide if the new domain will take off. However the hundreds of thousands already sold is a good indicator .tel is on the right track.

Building a successful online community

Originally written for Business Zone: Original LinkThis may not make me popular, but to me there are two constant truths regarding any online community. They seem to apply regardless of numbers of visitors, volume of postings, or even hours put into moderation and nurture.The first is simple, online communities are fundamentally flawed because they are driven by emotional humans like you and me! It's ironic, but people tend to show their feelings more readily in the online space than face-to-face. Managing the fallout while maintaining freedom of speech is a delicate balancing act.Moving on to my second point, we probably all remember the limelight-hogging natural performers from school days. Well they are still alive and well, and now living online. The power of any online forum comes from participation, which will come disproportionately from these guys. The challenge is both to encourage and protect the community.Within the eco system of an online community, members tend to fall into three distinct groups. These are newbies, casual users and hard-core fanatics. Each group tends to play a standard role. The newbies ask the questions, the fanatics answer them and the casuals move slowly up the scale or get bored and go elsewhere.This slow burn approach works, but it has a problem. It predominantly focuses on two groups; the "noobs" and the "ninjas", while ignoring the casuals. While there is no secret sauce to community building, there are a few tricks that can be applied to help to plug the gap.1. Understand the potential When you have a large group, there is always an immense amount of knowledge. You need to make your community members productive from the beginning. To do this, you need an environment where people feel comfortable and able to contribute.2. There is no such thing as a stupid questionNothing puts new visitors off quicker than a slap down after asking a basic question. This should be outlawed from the beginning. Adopting a zero tolerance policy and insisting that everyone is "friendly" may seem draconian, but you want to encourage everyone to stick around and participate further.3. There is no such thing as a stupid answerIf your "friendly" policy is working it also has a secondary benefit of allowing the newbies a chance to answer the easy questions. Extending the ethos to include "no stupid answers" is a natural second step.Your community should encourage everyone to have a go at answering questions. The key here is to carefully manage the fanatics. Ridiculing another's answer is simply against the rules.4. Motivate and informA great technique for encouraging participation is to feedback related user info and stats, then reward individuals and identify the top performers. The business networking site LinkedIn encourages healthy competition by allowing people to rate answers, and members can proudly display their ranking.Let's face facts, building a successful online community is hard work. Getting a bunch of emotional showoffs to work together for the greater good is never going to be easy. However, if you can pull it off the rewards are immense, and in the world of Web 2.0, your customers probably expect nothing less.

The psychology of selling

Written for Business Zone, you can view the original here.We are all creatures of compulsion. When we find something we like, we go back for more. Once we think we can get something we want, we perform the actions to get it. Slightly disturbingly, this pursuit of rewards isn't that different to our pets.There have been plenty of studies conducted by psychologists into our shopping habits, particularly based around this pursuit of rewards. Classic results encourage the careful placement of fresh flowers and baked bread in a store, and fresh coffee just brewing when a prospect views a house. We provide a pleasant experience (reward) for the buyer to associate with the product, making them more likely to return or buy. These principles can also be applied to the ecommerce marketplace, although the details are somewhat different.We all like treats. In ecommerce this might mean giving away a free gift with all orders for a short period. These gifts could vary from small low cost items to large valuable goods, depending on your own average order value.I have seen this work to great effect with several merchants who gave away prizes as wide ranging as free postage and packing to a holiday in the Maldives. Not only does this grab attention, it also creates excitement. A relevant treat can transform the casual browser into a buyer.However, as an etailer your best market is always your existing customers and selling to them is much easier than converting non-believers. Doing this is all about compulsion and association.Starting with compulsion, let's not be under any illusions; making an online store compulsive is difficult, so every possibility must be explored.For instance, when emailing customers, try to change the email subject line and body text based on who they are (if you know) or their buying habits, to make opening the communication more compulsive. A tennis coach may be attracted by a subject headlining cheap tennis balls, then go for a deal on fake tan once the email has been opened.Thinking about how products are marketed is another area. Maybe you could introduce limited product runs. So tell your existing customer base that the widget they bought in pink last month is now available in blue, but in limited numbers. The idea of shortage can create a gripping reason for customers to return.This leads us on to association. We all like our experience to be relevant to our own preferences. The retailer Amazon utilises this to great effect. As soon as you visit their site you are given recommendations based on previous shopping habits and browsing history. Creating that personalised one-to-one service helps turn a faceless shopping site into an extension of your life. The site knows about you, who you are and what you like. The potential for up selling is enormous.Like it or not, we respond to rewards. When running an online store, failing to recognise this fact is likely to lead to falling behind on the curve.