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Archive for August, 2011

Is Your Brand “C Colon Backslash…”? Godin, Typography, and Optimism

Wednesday, August 31st, 2011

In today’s post, Seth Godin argues that we can be lulled into settling for blah layouts and fonts because (after all) companies like Google, eBay, and Craigslist have treated them as an afterthought, and they’ve been wildly successful.

There’s no question he’s right. Trying to strip every element of marketing down to the bone is a kind of purists’ mentality. And in a world of profit margins, finite consumer mindshare, (or selling B2B “connections and comfort”), there is little room for purists. Apple has proven this in spades.

What’s a purist? There are many kinds. A purist is someone who insists that the world should have stopped in 1982 (remember, the year the disco-had-lost-all-its-charm-for-you). When no recreational cross-country skiers existed who did not have a working knowledge of how to apply the correct wax to a ski. When no race was held using anything other than “classic” technique, since “skating” hadn’t been invented yet. Today, most recreational Nordic skiers (especially those renting them) use waxless skis (as crappy as they may be). Most racers (and not a few novices) prefer to speed along on “skating” skis as opposed to fussing with classic technique. I’m perfectly happy with the 1982 world of cross-country skiing. I like wax. I like classic style. But if I were running a chalet or a retail store, as a purist, I’d be out of business.

But I digress.

“Advertising” may be the cost of creating unremarkable products, as some have said. Then again, it’s a cost many are willing to incur. And do we count basic communications and imagery (storytelling and positioning) as “wasteful” and superfluous or as part of the deal?

If you can ignore the “soft edges” elements of communication and still succeed, chances are you’re doing something very, very well. Or had great timing. But it’s not good advice to ignore them. Think of all the startups who have had meetings where they say “Craigslist was fine with this design, so let’s not think about it.” Where are they now?

Probably the best read on this subject is – yes – by Godin: All Marketers Are Liars (rebranded, ultimately, to the more apt All Marketers Tell Stories). It helped me understand that Starbucks had subtly and steadily painted its own little universe. Something for your mind to wrap around, not unlike a Disneyland of caffeine, while you decided whether to part with $4 for that mocchacino.

Starbucks isn’t just a building you go to to get some brown liquid, served up dutifully by adequate help. It’s a story.

Technology companies create “operating systems”. An operating system can be formally defined in a few ways, roughly as an environment that allows us to complete work and tasks using apps. What an operating system doesn’t have to be is compelling. But if it isn’t compelling, then it must at least become a standard (lest it become too easy to switch). In other words, if you ignore “compelling,” your business must be or become so strong that it becomes a de facto standard! Turns out even the mighty Craigslist never got to that point.

Remember DOS? Remember the Apple TV spots of long ago that made fun of the poor users who had received PC’s as Christmas presents, and were now trying to set it up? “C. Colon. Backslash…,” said the hapless Dad, in a flat voice. No one’s enjoying themselves.

Sure, your products may work. But insofar as you can take them into the realm of a pleasant, social, or forward-looking environment — you create a compelling “place” for your customers to be. Getting out of “C-Colon-Backslash” and into something slightly warmer, something slightly larger. That’s a marketing challenge worth pursuing.

Is there some truth in the opposite insight, too? Certainly there is. Consumers are exposed to more information today, and many stories won’t stand up to scrutiny. They’re more likely to discount brands and try to see through to the raw material behind it. If the quest for some authentic story can’t be pursued right through, that’s lip gloss, not marketing something authentic. That might work in some industries, but not all. Don’t try to sell me ibuprofen with commercials and fancy images — it’s just ibuprofen and I want to get it as cheaply as I can. As Godin has said in speeches: “I solved my pain reliever problem 25 years ago. I use the one in the yellow bottle. The generic!” He’s never wrong.

Related reading: Harry Beckwith, Selling the Invisible

AdWords Custom Polygon Targeting Sunset

Wednesday, August 24th, 2011

According to recent information, the option to use the polygon tool should already have been removed from AdWords for new campaigns.

One of the quietest Google announcements in history, it seems that a widely used targeting tool (often touted as a major advantage over competitors) is simply going to be taken down (arrrgh!).

Existing polygons will be served until the end of 2011.

Seeing this, I assumed Google’s replacement for this would be ever more adoption of Google Places, location extensions, and other elements of Google’s current local strategy. But the polygon has its own uses. So that was a complete arrrrgh!

But … it seems that the radius capability will still be available, which was what we all used originally before the polygons rolled out. So phhheww!

The question is why? Why remove polygons, and why keep the radii?

Our real concern should be that the other shoe will drop in 2012, and it will be bye-bye, radii.

Search Marketing’s Worst-Dressed Best Brains – Where Are They Now?

Tuesday, August 16th, 2011

Disclaimer: no brain cells were used in the creation of this post.

*** INSIDE BASEBALL ALERT — IF NAME-DROPPING OFFENDS YOU, LEAVE NOW!

As our industry matures, I sometimes find myself asking: “Where has the fun gone?”

Another question I ask, when I look back on something that happened to us “a couple of years ago,” is “what!! how did seven years go by that fast!?”

In this case I’m referring, of course, to Meredith A. Roth’s infamous “worst dressed list” for the “best brains” in search marketing, which came out at SES San Jose just over seven years ago. As a hook, it wasn’t bad: a geek-focused Mr. Blackwell on heels. Had skins been thicker and the tone less catty, this thing could have had legs.

Getting on the list could have been seen as a form of flattery, but at the time, few if any of those making the list reported being flattered. That despite a somewhat flattering intro:

Wanna hook up with the smartest people in the Search Engine Marketing biz? Look for the worst dressed. It’s SEO Tip number one: The brains of Search Engine Marketing and Search Engine Optimization are sartorially challenged.

As Ms. Roth so dismissively chose to focus on list members’ external appearance, I figured it might be worthwhile to check in on how those making the list of fared in their attempts to piece a career together… and, how are they dressing these days?

One inescapable conclusion seems to be that there was something to the notion that eventually, no matter who you are, you gotta clean up. And… could Ms. Roth have had an actual influence on these folks’ wardrobe strategies?

Here goes, with a recap of the unlucky winners, in reverse order.

10. Chris Sherman. Chris was tagged as a devotee of “business-too-casual.” This jab didn’t make much of a dent in Chris’s way of life. All he’s done since is continue to lead the industry as a partner in Third Door Media, Executive Editor of Search Engine Land, and author. What people don’t realize is Chris isn’t dressing for the conferences; he’s a true traveler who has been everywhere and needs to be ready with comfortable shoes and indestructible clothing to explore every corner of a city or the top of a mountain. Chris’s fast getaways are legendary and I’m lucky to count him as a great friend who will often take me along on the expedition.

9. Greg Jarboe, the “bearded guy you’d vote least likely to be in public relations.” OK, but answer me this: have you heard of him? I thought so. Greg has been the backbone of many SES’s since, and has evolved his firm and himself, including expertise on YouTube strategies and a book to match. This despite the views of Ms. Roth and one senior executive from across the pond who (it can now be revealed) opined that “we’ve got to get Jarboe out of those horrible jumpers.”

8. Bryan Eisenberg. Have a good look at Bryan’s photo on his website. That’s the Bryan Eisenberg you see today. It’s undoubtedly true that the best revenge is living well. Some time after making the infamous list, Bryan embarked on a personal journey that included a weight loss in excess of 95 lbs. Formerly, he packed as much as 290 lbs. on his 6’2″ frame. There is less of him to love now, but all of us who count him as a friend are happy that he’ll be around much longer to spellbind us with deep-seated understanding of the online user experience. And yes, as a result of all that, he has new clothes.

6. Shari Thurow, Karen Breen Vogel, and Stacy Williams were singled out for looking like a “PTA panel.” Not only did they maintain their high visibility in the industry, but I’m pretty sure I’ve witnessed several rounds of shopping in the two of these three I know well. I guess we were all just too busy to dress ourselves in the old days. Not that we aren’t still busy. Shari, for one, has published a couple of books since her original groundbreaking work.

5. I’m pretty sure Heather LLoyd-Martin didn’t need any outside prompting to be aware of her “skirts being up to here” in 2004.

4. Detlev Johnson? Oh, what am I getting  myself into. Well suffice to say this: no one’s going to accuse Disa Johnson of looking like she is on a “PTA panel”.

3. Kevin Lee‘s success is obvious proof of the “wear your boothwear” strategy so derided by Ms. Roth. We assume that Kevin did not, nor did he wish to, show Ms. Roth whether the “Did-it duds came in undies too.”

2. “Industry maverick” Mike Grehan was singled out for his look being “100% spinal tap,” but “catch his session and you’ll be thoroughly entertained, enthralled, and educated.” Mike, tied for my very best friend in the industry, has certainly put on a show since. Ms. Roth wouldn’t have been the only one to kid him for his “look” at the time. Since becoming an avidly-shopping New Yorker, Mike has updated that look at least once. Today at the SES San Francisco show, he wins my award for “best dressed at the conference”. On top of the perfect suit and tie, I just need to know where to get a pair of those perfectly-matching shades. Since taking over the job as VP of Global Content for Incisive Media three years ago, Mike’s career dial has gone to “11.” According to his bio, Mike is supposedly releasing a new book this summer.

1. Danny Sullivan. It seems such a long time ago that “vintage Danny” was “dressing British,” perhaps because he resided in a quaint village near Stonehenge and Madonna’s house and could only get to London occasionally for a quick dash into one of those stores that sold stuffy criss-cross ties meant to be worn with bespoke finery. Today, as we’re kept well aware by his frequent tweets and twitpics, Danny leads with California casual style from his rollerblading home base in Newport Beach, CA. In other words, the look that Rand Fishkin has unsuccessfully tried to copy. When you have a combined 200,000 in legit twitter followers, though, does it really look like anyone needs to copy anyone else?

This brings me to the subject matter of my next post: “facial hair of SEM top 10 list”. But this is for another time (and after I have six months to grow the beard).

The Rise and Fall of Remarketing (CPC’s, at least)

Monday, August 15th, 2011

When Google AdWords rolled out its remarketing feature, many of us felt we’d stumbled on an exciting — but modest — new high-ROI targeting segment. By combining contextual targeting (keywords denoting which sites in the network our ads would show up on) with audiences (people who had done something in relation to your website in the past x days, cookied and followed around), suddenly these ads that generated some user complaints about “feeling stalked” were feeling like a pretty neat bonus for marketers, without being unduly intrusive. Early case studies showed ROI off the charts. On some accounts, as a result, we did a lot of this — implementing it carefully one ad group at a time.

At some point Google sent the word out to its reps, and through them, to agencies, that broader-based remarketing (no context, just audience, using impression caps if you like) was more practical. It offered wider reach. And if it wasn’t wide enough, we were given case studies that encouraged significant bid increases just to make sure you were “using it correctly” (paraphrasing here). These more general campaigns would work differently, but would move the needle more, and would be easier to implement.

It was at that point I felt that the majority of advertisers were being encouraged to bid unrealistically, in multiple dollars per click, on inventory that — while valuable — couldn’t support those levels when market forces (CPC’s and bid levels based on performance, and easy comparisons with other traffic in your account) kicked in.

Even with ongoing optimization, we weren’t finding the CPA’s quite within our target range. I imagine other advertisers are gradually coming to this conclusion. (And yes, the ROI for the original, narrower context-meets-audience version of this remains very high, so that’s a separate issue.)

This softness in demand for more general remarketing is indeed beginning to manifest itself. After several modest bid reductions for one retail client we work with in this area, we’ve recently seen no slackening of click volumes, and indeed a gradual improvement in ad position.

This smells every bid to me like the “reverse bidding wars” that we relish in this industry, that come along every so often until the bids reach a more realistic equilibrium.

rmkt

From time to time in this auction, market forces do work in our favor. And not even clever “best practices” Powerpoints from Google can keep us all overbidding forever.

Here are some stats in connection with this case study:

  • In recent weeks, the ROAS on the generalized remarketing effort is 2.08 – below where we’d like to see it. The conversion rate is 5.3%. Healthy, but the low ROAS indicates we’re still paying a premium for this valuable inventory.
  • By contrast, display network clicks across the account have had an ROAS of 2.52 over the same period, despite a weaker 2.57% conversion rate — indicating more economical click prices.
  • The search inventory produces much better numbers than either of these.
  • View-through conversions are worth considering — all versions of display, including remarketing, do indirectly drive recall and sales. Hard to value precisely, though.
  • The original remarketing effort — the hybrid of context and audience (ad group by ad group remarketing, with keywords) — performs far better, with conversion rates 8-15% depending on the ad group, thus meriting high CPC’s.

The simple takeaway is that the inventory is valuable and the technique offers much promise, but as with everything else, there is a market value for the clicks, and you can’t talk it up (or down) indefinitely. It will gravitate in the direction of its real worth.

As with other forms of interruption-based advertising (however targeted), the novelty effect wears off and the entry of more participants in a cluttered, finite sphere of user attention may also lead to gradual, or even sharp, declines in response rates and thus prices. That depends to a certain extent on how you use it, but it might also be a collective action problem. The Tragedy of the Commons applies to almost any ridiculously appealing, high-response form of advertising. What’s good for you is good for others, so the user can be bombarded with messages and begin to rebel.

Google Plus: An Evolution in Social, a Revolution in Permission

Friday, August 5th, 2011

In terms of sheer user adoption, Google+ may be the most successful online service launch. Recent estimates place the user base at 25 million. Now that’s a fast start. Any other company would have struggled mightily with capacity issues by now.

The service seems well received, even though (similar to Gmail) it only lightly innovates on top of an existing category. Why is it a game-changer? Because of its scale and not because of any revolution in user behavior.

How Google+ Will Advance Display Advertising

Google+ solves a real problem. It helps to advance online display ad targeting, which has had limited the company, and most advertisers, to date. Essentially, Google will now have full, opt-in access to your demographics, tastes, and behavior. Prior to this, Google, as well as other firms and advertisers, were almost there. Now, the more people that embrace Google+, the more fully this loop will be closed.

The analogy of the last-mile problem comes to mind. The last mile referred to the inadequate Internet connection from a person’s home to the larger, more sophisticated global network. As demand increased for faster home connections, innovation and investment followed despite a lack of elegant, efficient solutions. This is analogous to Google building an incredibly expensive social network just so it can close the attribution loop and create more fertile audiences for its existing advertising base. It’s a huge bet, but with a quantifiable payoff.

Why Google+ Is Not Another Facebook

Analysts and practitioners are already trying to guess at how Google will target advertising in this platform. Most are looking at Google+ as a copy of Facebook, but that’s not a good comparison. It’s not primarily about the ads that will show up inside Google+, though they will. It isn’t primarily about being able to take social targeting and target searchers, or searches, to target within social.

Google’s biggest advance is the creation and maintenance of richer, more granular, and more predictable audiences for advertisers, allowing for better targeting of display advertising all over the digital universe. In many cases, of course, Google will split the proceeds with publishers, networks, and exchanges. But increasingly, advertisers will enjoy the benefit of doing more through a single platform – or at least fewer platforms.

How can Google accomplish all of this with a social network? With a single checkbox. The signup process for new users says it all: when signing up for Google+, you give Google permission to use your personal information “to personalise content and ads on non-Google websites.” It started out as a consequence of signing up for and using the +1 button. Now, signing up for Google+ accomplishes the same thing.

Is providing richer personal data through Google+ similar to Facebook’s “interest categories”? Potentially, it’s a lot more than that. You could deny Google this right by simply unchecking the box on sign-up. I’d love to see what percentage of Google+’s 25,000,000 users to date did so.

If Google can obtain this rich data about its users, it might continue to grow its top-line revenue and profit margin from display advertising; so display advertising wouldn’t look anemic compared to the cash cow, search. Compared with search, Google’s other advertising revenues (mainly, the display network) have limped along slowly, especially given the singular focus Google has put on widening its footprint over the past five years. Google’s very strong quarterly earnings report released in July shows that non-Google sites account for only 31% of Google’s revenues (years ago, this proportion was a fair bit higher), and that 31% is won at significant cost by sharing a high percentage of revenues with AdSense partners, etc. Given that relatively weak performance, it isn’t out of line to assume that Google’s investment in Google+ has more to do further buttressing their lagging push into display advertising, as it does with Google really matching other social networks step for step on “sociability” or “cool factor,” whatever those mean anyway.

Google doesn’t “get” social, say the critics. But they’re beginning to “work” social, and it’s not really clear that they care about “getting it.” That’s because they have some pretty focused business reasons for being there, and for Google, that’s good enough.

Google+: Right Time, Right Place?

Some suggest that pent-up demand for a Facebook alternative is driving Google+’s growth. Some prominent “socialites” have essentially left their Facebook presences dormant since the company’s high-profile privacy gaffes. Google is far from immune to criticism on the privacy front, but there is a collective feeling out there that veteran Googlers have taken their lumps, whereas Mark Zuckerberg is an untamed animal still on the loose with weaker adult supervision.

Privacy gaffes by Facebook as well as by Google (Buzz) seemed to change public expectations about privacy – or lack thereof. Interestingly, Google created something called a Hangout inside of Google+. No one is under the impression that he is going to “hang out” in these platforms in a genuine, unfettered way. Either your guard must be up permanently, or you must accept that people will know more about you as part of this new, more open way of life.

As if to make this point directly, on Google+, we see Googlers subtly training us to be “transparent.” A photo of Larry Page waterskiing received hundreds of comments.

A Formidable Facebook Foe?

Google eventually can benefit from operating the most functional, sophisticated advertising platform in the world. As a result, Facebook will face its first serious competition. Its advertiser platform is one-dimensional and behind schedule compared to Google’s multi-dimensional, highly evolved system.

Facebook’s likely initial public offering – and all of the distractions that accompany IPOs, including departures by vested employees – poses another challenge to Facebook. (Google went through this already.)

Google’s other advantages over Facebook?

  • Google’s slightly better reputation on privacy issues.
  • Its superior engineering talent that is helping to marry search with social with local with photos and videos with messaging and email.
  • Google’s expansion is funded through cash flow. Facebook has burned significant sums of cash to get to where it is now.
  • Its ability to innovate on issues involving speed and cost, and its massive scalability.

Google operates search, YouTube, Gmail, and now, Google+ with aplomb. By contrast, Facebook (a behemoth, to be sure) handles far less data; it will have difficulty scaling efficiently into new realms.

Facebook suddenly looks beatable. Facebook’s biggest asset? Aside from users and their behavior: the Googlers who now work there. But that could change. What hot start-up will bored ex-Facebookers be jumping to in a couple years?

From a cultural standpoint, Google+ still faces an uphill battle. A useful product isn’t the same as a place you feel proud to hang out in, or go to appear cool. Google will need to maintain a fun image. Strange to pose this as a challenge for a company with Doodles on its home page and exercise balls as furniture. But photos of Larry waterskiing don’t exactly scream “Facebook killer.”

But its first taste of serious competition will no doubt cramp Facebook’s style. And when the analysts start comparing the two companies directly on things like profit margins and the number of defensible, home-grown technologies, Facebook’s early swagger will be a thing of the past.

An earlier version of this column appeared at ClickZ on July 15, 2011. Reprinted by permission.

No Ordinary Recession: How Has the Great “Reset” Affected Us So Far?

Thursday, August 4th, 2011

Nearly three years ago, I wrote a two-parter for Search Engine Land addressing the “Wall Street Meltdown” and how it would affect digital marketers in the coming years.

Although many people suspected things were going to be a bit rough, only a minority were concerned enough to believe that a major shift was taking place. You’re supposed to “bounce back” from recessions. It didn’t happen this time.

Since September 2008 when I wrote the piece, the stock indexes have remained about where they were. The precipitious fall continued into 2009, then a powerful rally got things back to where they had been, and as of this writing, stocks are falling steadily. The market is almost always a pretty good (18-month) leading indicator, so along with everything else, that indicator suggests we’re headed for more trouble and more slack demand.

What perhaps couldn’t have been predicted was the fact that the tech investment bubble kept bubbling – seemingly exponentially – in the midst of unprecedented calamities in housing prices, employment, etc., in the rest of the economy. Analogous to the process by which much of the loot at the top of the economic expansion went disproportionately to a few in the finance sector (either in bonuses from successful bets, or government transfers for bailouts), these high-tech windfalls don’t seem to do much to stimulate the broader sector, at least in the short term. The founders and investors in a small number of companies like Facebook, LinkedIn, Twitter, GroupOn, Pandora, etc., walk away with windfalls from IPO’s or pre-IPO financings, limiting the “good times” to a small number of winners. Companies in a rush to do the same thing suddenly look out of step with normal human decency when they grab a little too hard for it, openly, without taking care of things like basic safety, ethics, etc. — to wit, the recent Airbnb fiasco.

There have been a raft of successful tech IPO’s in the past couple of years, after a long drought. It’s entirely possible, though, that a decent number of those in the planning phases may need to be shelved as investor demand dries up. It will be interesting to watch whether investors continue to look the other way at ugly fundamentals and questionable founder ethics, or if such companies will soon be held to “normal” investment standards.

That aside, the continued success of this sector isn’t inconsistent with the economy, as this is not a normal “demand slackening,” general sort of slowdown, but rather an inchoate and yet-to-be-determined reorienting of how economic and social life are organized. Richard Florida calls these episodes “Great Resets,” and posits that this is only the third such reset since the 1870′s. During the Great Depression, for example, Prof. Florida cites a wide variety of innovations and huge leaps forward in productivity that rolled out in the wake of the Roaring Twenties, as the general population retrenched into caution and often grinding poverty. I’ll dig into this in a future post.

Essentially, there are a series of cataclysmic changes happening at once: broader fiscal and economic cycle issues; the ‘Chaos Scenario’ for old media, the Great Reset that will continue to produce steady declines in employment in many traditional working-class and middle-class professions, while creating massive growth for high-skill Creative Class professions on one hand, and dead-end but tolerable service-sector jobs on the other (and somehow to be afforded, the persistence of stable government jobs and a huge increase in health-care related employment). Are these trends all interrelated? No; it’s dangerous to try to divine some coherent logic from every trend. But with the pace of change, the insistence by analysts like Florida that some kind of Schumpeterian process of “creative destruction” is currently at its height is obvious, on one hand, and depending on where you sit, perhaps too sanguine, on the other.

Anyway, to touch back on a few highlights among the 11 predictions I made for our particular sector nearly three years ago, they were roughly as follows (paraphrasing at times):

  1. Paid search will remain relatively robust.
  2. Display ads are vulnerable in a slowdown
  3. Weak companies die. The strong get stronger.
  4. M&A and downsizing means frequent job changes for some
  5. Phony ‘performers’ and ‘rock stars’ get outed, and real expertise becomes easier to spot
  6. The tools of business and pleasure all get cheaper, for those who can afford them. The face-to-face conference business won’t dry up (in our sector) as fast as you might think or fear.
  7. More people will re-evaluate their priorities, values, and goals.
  8. Real-world financial problems will be achingly bad for many folks, something that should become hard to ignore even inside the most meticulously-constructed digital bubble.
  9. Traditional ad agencies and traditional media will continue to decline.

How do you think these predictions played out? Were some of them on the mark? Most? All? Let me know what you think.

I’ll be back in a bit, when time allows.

 


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