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Testing and Statistical Confidence: The Three Bears

Posted August 26th, 2013 by Andrew Goodman

The primary danger in taking actions in response to data (or even structured tests) in our industry appears to be overconfidence in overt data points and a lack of grasp of randomness and statistical confidence levels, leading to a flurry of actions and tweaks that get us more lost in the woods, not less. (I pointed this out here, last week.)

According to cognitive scientists like Daniel Kahneman and Amos Tversky, humans — even professional statisticians — are “poor intuitive statisticians.” (Predictably, some up-and-coming scholars in the same field have argued just the opposite.)

Translated into terms we see in our daily work in performance-based ad testing (etc.), it’s very common for novices — or even good workers who feel under the gun from bosses/clients who push us to “test more, do more,” — to respond frequently to random bits of data. For example, ads will be paused in favor of the ad or two that are “winning,” despite the statistical confidence levels on the win being (if you took the trouble to run them through a calculator) below 70%, despite the fact that a suboptimal attribution model is used such that sometimes segments get “last click credit” for “converting,” but other times do not (and again, often that is for no rhyme nor reason other than pure randomness). “What’s working better” in a combination of ads, keywords, queries, landing pages, inter-family buying dynamics, and medium to long consideration cycles — is never as easy as it looks. Tweaking to random data is, arguably, tantamount to concluding tests before they’re finished. In other words, you set up a whole bunch of experiments, and then shut them down prematurely. Wasted resources and insufficient learning/takeaways.

Too much random tweaking, we might say, is the action of the Impetuous Bear.

At the other end of the spectrum is the Inertia Bear. That bear once saw an A/B test that was rigged to be exactly the same ad competing with itself. 9 conversions accrued to the “winning version,” and only one to the “losing” (yet identical) version. Consulting the math experts, that outcome (in the case of a truly fair coin flip) happens only ten times out of 1024, so it’s less than 1% likely to happen. And yet it happened! From this, the Inertia Bear decides to insert a lot of these “placebo tests” into testing as a way to guard against acting on purely random results. Over time, though, the paranoia about some results necessary being random or impossible to explain (or correlate with the triggers being tested) begins to creep into a general mistrust of testing. That leads to a broader trend away from building anything new. That works fine, until it doesn’t.

So is the answer to simply be “Moderate Bear” and chart a path in between the two? Well, certainly you want to avoid either of these two extremes.

But in addition to that, you probably should be Curious Bear or Creative Bear, the kind of bear that fashions new things to see what might come of them, regardless of what the data say. If you’re purely driven by spreadsheets, provable outcomes, and “what’s best for the shareholders,” your output is bound to be less interesting. (See If Steve Ballmer Ran Apple.) And the end result of that, we see all around us. It’s why — despite not being an Apple guy either — while I have been somewhat intrigued by the Microsoft Surface tablet, I never bothered to actually buy one. If someone didn’t demonstrably pour some passion into the conception and development of the product, then why would I line up to buy it? Probably, I eventually will. Maybe. (Is that level consumer intent even worth testing around?)

The Relentlessly-Widening Performance Gap

Posted August 14th, 2013 by Andrew Goodman

Recently, I had a chance to review a deck produced by one agency handing back over a PPC account to its client owners (or potentially, a future agency).

Bullet point after bullet point referred to emphatic actions taken in the account. No doubt this only scratched the surface of the great number of actions taken.

I’ve always worked in the AdWords auction with a tacit ideal of “the perfect account.” Of course, there is no such thing. But insofar as every action has a chance to move either towards or away from perfection (much like a bronze sculpture, except that PPC is 90% science, 10% art), the end result of a vast many changes can vary greatly from manager to manager, account to account.

Analogy #43,589: you can think you’re going in a straight line in the forest, when what you’re really doing is making so many wrong turns you get impossibly lost. Getting out of the forest is actually easy, though, if all goes reasonably well. You find a river and follow it. Not counting the potential hypothermia and bears, “lost in the forest” is a picnic compared with “made 5,000 wrong moves in AdWords.”

What if the majority of changes in the account are pure guesswork, such that no change — the status quo — would have been superior to the change? As performance challenges toughen, are those errors compounded by further changes and desperation borne of declining performance? That sense of urgency — ironically, created by an urgent sense that bold, decisive action needs to be taken (often in the absence of insight into how much of that action is based on inexperience or guesswork) — parallels the “Death Spiral” concept that Jim Collins outlines in books like Good to Great. (That’s the opposite of focusing on the Hedgehog Concept and Turning the Flywheel.)

When you see a list of initiatives being taken in account management, it’s worth asking: how much of it is pure guesswork? Guesswork is nothing like testing. A testing orientation will greatly reduce guesswork. A typical “guesswork” bullet point would say something like “paused all ads with CTR below 1%.” Testing isn’t like that. Try instead: “Chose the winning ad, based on a thorough understanding of performance criteria, not necessarily reduced to one variable in all cases, and insofar as feasible, with statistically significant data (to a 95% or 99% confidence level).”

Other guesswork gimmicks include adding 1,000 new exact match keywords to an account from a keyword dump, because you have a theory about exact match. Despite 30% of those phrases being poor fits in the account. One step forward… two steps back… endless busywork… not data-driven.

When accounts are managed based on pure guesswork, they get farther and farther from perfect, rather than the other way around. Approaching perfection isn’t easy. Even the best account managers using the smartest rules will make many so-so decisions. But they need to be vastly outweighed by a strong overall sense of how moving parts in an account strategy fit together. And most of all, the actions taken should be accurate (not guesswork) most of the time.

Not as easy as it looks. It’s especially daunting to decide (many times over) that “no action” is safer than “wrong action.” How can you improve anything unless you’re constantly doing stuff, right? (Unless it’s the wrong stuff!)

If you hand a high quality account over to a relative novice, it’s predictable what will happen: performance will begin gradually deteriorating from Day One. As things worsen, the scattershot “panic tweaking” begins. It then takes a steady hand and a high quality rebuild to bring everything back into line.

Give an account to a guesswork-driven manager to build from the start, and there’s a good chance it won’t reach anywhere close to its potential.

As one of my colleagues said to a client, once: “It’s like chess.” (Unfortunately, turned out the client was a Chess Grandmaster, and far smarter than 99.99% of the population at chess. But that’s a story for another day.)

Manufacturing Purple Cows When Others Can’t

Posted August 12th, 2013 by Andrew Goodman

“All they care about is price.” Seth Godin reminds us that pure commodity thinking is deadly. If that’s all your customers can think about, they don’t care about anything to do with your product.

As PPC marketers wading into competitive (sometimes expensive) keyword auctions, we’re dead before we begin if we can’t suss out some so-called Unique Selling Propositions. Call it an identity. Call it differentiation. Call it a “story” (All Marketers Are Liars). Or just call it a Purple Cow.

Looking back over the long haul of efforts to win through sheer tactics, I can’t find too many businesses that have been unbendingly commodified to the point where we just throw up our hands, helpless. There have been a few. Web hosting is so bad it will make your eyes bleed if you’re a PPC marketer. Obviously, stuff like credit card deals and comparison sites will get pretty ridiculous as well. And even if you’re really good at working hard on the details — endlessly tweaking landing pages for conversion, even — you’re up against other companies that have Tim Ash or Conversion Rate Experts working on the same thing, up against obsessed PPC optimization and testing from the likes of yours truly (Page Zero Media), etc. It’s no picnic.

We were pretty impressed when one of our former clients, 50% of whose revenues came from various takes on web hosting, threw up their hands and divested all of their web hosting businesses in order focus on areas that were working, areas that weren’t so ludicrously commoditized.

Even at that, their other line of business — domain names (in various guises and areas of that industry) — is supposedly dangerously commoditized due to the well-known “GoDaddy effect.” The GoDaddy Effect has reached way beyond GoDaddy of course. Behemoths like Yahoo, various utility companies, web developers and yes hosting companies by the thousands — are all in on the act.

We certainly found that turning a profit on an $8 or $15 domain name registration wasn’t going to be a walk in the park via PPC. Over the years, we had our successes and failures in that endeavor. But the client, fortunately, kept building their unique take on their services, and an extremely loyal following. Plain and simple, what they offered was better and more tailored to the discerning customer’s needs. The sometimes-higher price point was simply a signal of that better neighborhood. And indeed, nearly 100% of the customers are buying from our client as a conscious protest against the GoDaddy’s of the world.

After years of staying the course, building great products, and telling their story in a supposed “commodity” business, this client has experienced a nice little breakout. (Their stock price is, in fact, up 82% in the past year, and business has never been better.)

Drawing out your unique qualities is almost always vitally important unless your competitors (and their agencies or in house professionals) are just stumblebums when it comes to logistics and campaign optimization. And it is almost always possible.

Like Seth says, it’s pretty rare that you can purely out-execute your industry peers by managing strictly to numbers. That is tablestakes, to be sure. But your big breakthroughs come from figuring out how people are going to react emotionally to your offering. Yes, emotionally.

PPC: Fast and Slow

Posted July 11th, 2013 by Andrew Goodman

At our house, “Canada’s Worst Driver” is a huge hit. The show is so popular nationwide that it’s into its eighth season. Not too shabby.

Speaking of “hit,” that’s what contestants do to the inanimate objects in the obstacle courses, on a regular basis. On “Canada’s Worst Driver,” the expert judges consist of a retired cop, a couple of advanced driving instructors, and – yes – a psychologist.

This last one is telling, because the show is like a lab demonstration of just how sound theories of attention are. Even if you’re a talented driver, distractions can be hazardous. Distractions can drain anyone’s ability to concentrate. The most dysfunctional drivers also happen, quite often, to be part of dysfunctional couples. When the hyper-critical spouse is riding shotgun, there is screaming, crying, and denting of fenders. When they kick the spouse out and let the “hopeless” driver go it alone, there is often marked improvement.

Many of us would rather rely on our “raw skill” than admit we need to step back and build in a consistent routine intended to manage our natural limitations.

In the highly acclaimed “Thinking: Fast and Slow,” Daniel Kahneman synthesizes decades of research that has uncovered two distinct thinking “systems” in our brains. System 1 (reactive) is essential for bundling together eons of evolution and a lifetime of experience into seamless performance. As amazing as this system is, its performance is easily degraded – for example, by fatigue and distractions. It won’t work effectively in the modern world without System 2, a deliberative form of thinking that is required to produce rational outcomes.

Back to the example of driving: assuming we’re reasonably skilled drivers, Kahneman notes that we’re amazing at letting our eyes and hands work to steer around a curve, with little consciousness of our skill in processing the information and reacting to it. But we need System 2 to tell us to set up a routine like drinking coffee, singing, and rolling the windows down on a long drive. Although unromantic, years of deliberations by engineers have taken our “skill” of slamming on the brakes in dangerous situations and created a much safer (machine-driven) stopping method: ABS. Neither our legs nor our brains can jam the brakes on and off fifteen times per second. We’re safer now on slick pavement because of System 2; i.e., what the engineers built and tested over a long period of time.

Too often, we hop into our PPC accounts with an excess dependence on an all-too-human System 1, like we’re some spreadsheet-enabled Tarzan swinging on a vine.

Neither being busy, nor being “really good at this stuff,” should be an excuse for completely ignoring the need to incorporate deliberative, “slow-thought” protocols into your campaign management methodology. The fact that it feels “right” to nervously tweak incremental details of accounts during the “fast season” doesn’t make that activity particularly effective. It doesn’t mean you’re off the hook in terms of System 2.

Now that we’re hitting the summer months, you may be relieved to have a little breathing room to work on more methodical, “important but not urgent” initiatives. Indeed, if you put in the time now, things might feel less frantic come fall. Not only that, but System 2 is great at building systems, protocols, and machines… not just operating them with a twitchy trigger finger. Systems, protocols, and machines are what will make you the real money. How are you going to build something new or better that scales, that relies less on your raw animal (or even advanced cognitive) abilities?

Here are some to-do’s to consider:

  • Set up new remarketing audiences and come up with new image ad creative. If you have a PPC account with little or no remarketing set up, you need to do this yesterday. The same goes for replacing outmoded remarketing code with “new” remarketing code, such as Google’s Universal Remarketing Tag. Remember that a remarketing audience must be cookied as such; your audience size starts at zero. Get that code installed on the website! Start now! If you’ve already started remarketing, work on thinking it throug more thoroughly, with custom combinations that include cart abandoners, a “don’t show any ads for the first three days” setting, etc., as seems appropriate to your custom needs. Or contact your Google rep for more information on Dynamic Remarketing, if you retail a large number of products. Finally, think through what story you want to tell, or what brand image you want to portray, with your image ads. You’ll be serving tens of millions of impressions, typically. What do you want people to see (over, and over, and over)?
  • Build simple or complex bid rules and figure out how often you’ll run them. Along with the more obvious account-wide sweeps you might do to look for anomalies or opportunities, you can also try less comprehensive, non-obvious ways of building filters and bid rules to create bespoke outcomes. For example, filter for match type and bid down on a match type you feel has been grabbing too much impression share away from better match types. Or run an account-wide match type performance report using a third-party tool like Optmyzr. That can be a nice way to inject your creativity and your “rock star powers” into the equation. But it is System 2 thinking because you’re slowing down and taking stock of how the account functions, instead of merely reacting to little pieces of data like Miguel Cabrera diving out of the way of a brushback pitch.

brushback pitch

  • Review long-running ad tests with insight into why they were set up that way in the first place. Don’t just stab the pause button at lower performers, and don’t end tests that are too close together in performance yet to be statistically distinct. Take some time to recall what principles went into the tests, and if you draw any conclusions, take time to communicate those with someone – preferably in writing. To take an example, a client in the office furniture business has several internal landing pages that are underperforming the home page in terms of ROI on PPC. Had we followed only best practices, we’d have stuck rigidly to the notion that the keyword should take us to the focused landing page, and that is that. We now have more insight into the workings of the site as it relates to different product lines. Testing is about the spirit of inquiry, which requires continuity and planning. It’s not nearly as effective when it’s only about stabbing a pause button.
  • Deliberately incorporate teamwork; don’t be a lone wolf. Successful testing, and successful companies, require a culture of acceptable debate and disagreement, as shown by Jim Collins in “Good to Great” – Collins calls it “confronting the brutal facts.” Testing isn’t about consensus, it’s about learning and iterating. As Seth Godin pointed out in “Survival Is Not Enough,” you need to think about how to involve various perspectives in your decision-making so that there is a robust mDNA (meme DNA) in your operations. Godin insightfully argues that in terms of evolving to meet new industry challenges, “competence” can be a company’s worst enemy, as it gets stuck on a routinized “winning strategy.” To shake things up when seeking input, consider a shortcut: informally “crowdsourcing” within your own company (assuming you’ve encouraged diversity in your company) – use an anonymous process if that helps. Be supportive of “weird” ideas, as long as they’re not the only ideas people suggest.
  • Get high-powered tools working for you. Above, say, $500,000 in annual ecommerce revenues, do you really have any excuse not to put a program of A/B testing in place for key landing pages? And for a busy home page driving $2 million or more, is there any excuse not to seek out an advanced multivariate testing tool to see if you can’t create a lift of 15-20% in conversions from visitors landing there? Simple math: 15% X $2 million = $300,000/yr. in increased revenues. For that kind of money, it’s pretty obvious what you should do: push away from the desk so you can’t tweak those same keyword bids 50 more times, or add another 700 negative keywords to a campaign. Get the right tools and team together and set that goal to generate that 15% lift in conversion from that page.

Cognitive scientists like Kahneman and his colleagues often employ a simple word to describe our tendency to over-rely on System 1 (reactive/heuristic thought), and to avoid too much engagement with the more mentally taxing System 2: “lazy.” It seems we’re hard-wired to conserve mental energy. Reacting does not wear us out as much as stepping back and planning. But of course a day spent reacting will be a day where we eventually make many mistakes as we fatigue, even if we’re “smart” or “sharp.”

So, plan we must. And some of that planning needs to create the kind of consistency that appears to take “us” out of the equation. By taking steps to remove your System 1 self out of the equation more often, and using your System 2 self to do so, arguably, it’s a higher-order “you” that’s involved. “Smart” or “sharp” needs to give way to “rational” when dealing with large, complex systems. It is rocket science.

To profit in the midst of modern, complex systems, our natural aversion to System 2 thinking (it’s just so taxing) is something we need to combat. System 1 was great for prehistoric man running from a hungry predator, and remains an advantage in the sport of dodgeball. But it’s terrible for sitting at a desk and correctly intuiting statistical confidence in an ad test.

Schedule an appropriate amount of time in your schedule for System 2 thinking. There’s no time like the present!

An earlier version of this column ran at ClickZ on Nov. 30, 2012. Reprinted by permission.

The Most Credible Brands Are the Thought Leaders… and How Google Is Going to Make Very Sure of That

Posted July 8th, 2013 by Andrew Goodman

What does it look like these days when someone Googles your brand? For years, that question has been under the purview of “online reputation management.”

Phase I of that field (1998-2007) was roughly: did you screw up your meta-tags and title tags, inadvertently block Google and other search engines with your robots.txt file or some arcane spider-stopper, or have you been so lazy about any kind of online engagement or presence that malicious mentions of your company overshadow the core information that you hope prospective customers find when they first go looking?

In Phase II (2008-2012), there were more ways of, in essence, complying with certain norms and channels offered by Google that could help you put a lot of useful information out for human consumption, much of it predictably appearing above the fold on the first page of search results. Along with your main home page (and increasingly, most companies took advantage of the opportunity to take up vastly more screen real estate by taking advantage of SiteLinks in the organic SERP’s), you’d do well if you had significant video content. You could also take up further space with a nice juicy paid search unit on your brand term, made larger through the incorporation of SiteLinks. Many companies began monitoring for new good and bad mentions — at first, in a semi-clueless way, and over time, in a more ongoing fashion using well-established tools.

Welcome to Phase III (2013-). Google is eager to provide brands with additional means of demonstrating their personalities and thought leadership. Certainly this would not be the case for Google’s bread and butter — searches with high commercial intent that Google must earn revenue from. But on brand keyword searches, it is clearly Google’s wish to promote the whole idea of “deep content” and “ongoing engagement.” Across the board, Google is frustrated with faux content and cheap tricks used by bit players attempting to rank well using SEO parlor tricks. The flip side of Google’s more punitive side — algorithmically and manually cracking down on cheating and purveying of scraped or low-quality content — is this apparent campaign to provide publishers and brands with incentives to be engaged and interesting. Whether this is done indirectly, via blog posts and articles, or in a more integrated fashion, through direct posting in Google’s own social media environment (Google+), Google’s environment seems bent on rewarding the adopters. So it almost goes without saying that, in this context, “adopter” means

Among other things, this continues to be serious business in the undeniable battle for mindshare between Google and Facebook, as companies and “environments.” Google+ isn’t Facebook now and may never be. But it can be hazardous to your business health to underestimate Google. (Remember the adoption curves of GMail and Chrome?) A recent search ranking factors study by Searchmetrics points out — almost as an aside — that Google+ is on pace to meaningfully eclipse Facebook if you go by certain metrics (+1′s vs likes, etc.) by the middle of 2016.

The adopters are already being rewarded. Those integrating their blog posts and overall presence with a clearly identifiable Google+ identity are showing up with nice large boxes — complete with logo, image, and rich snippet — to the right hand side of the SERP. Rather than a set of plain listings, then, a search for (say) Hootsuite provides a showcase for the brand, positioning it as a thought leader you should consider following.

Hootsuite SerP

Even a formerly clumsy brand like Canadian Tire is apparently going all in with its social media strategy, enjoying a similar treatment with the large visible Canadian Tire logo to the right hand side of the screen. In this case, the user isn’t taken to a blog post on the CT site, but rather directly to its Google+ page. There are some clear hiccups here: the post I got was in French and it felt like I came into the middle of a conversation I don’t understand… something about helping their team kick the tires, as it were, on this very social media experiment. This effort is threatening to be a bit of a Meatball Sundae.

Canadian Tire SERP

Barnes & Noble turns up in the sad camp. The flailing, mid-sized retailer of books appears to be a non-adopter of both social media integration and paid search with SiteLinks. This draws even more attention to a negative mention: a Forbes story asking if the company will be around in five years.

barnesandnoble serp

Another company that could be doing better? Hormel. Perhaps the problem lies in their association with Spam. But that’s a debate for another day.

And how is a reputational legend like Zappos doing in this environment? Very well, it seems. A search for “Zappos” brings up the same box, image, and logo with a link, no doubt emanating from a post on their Google+ page. This one’s a little weird, because all it says is “Nothing like a fresh pair of shoes,” with a link, simply, to the Zappos home page. Not exactly thought leadership. Well, if the shoe fits…

zappos serp

Google has set the table. Now, we all have a lot of work to do.

Display Ads That Perform

Posted June 25th, 2013 by Andrew Goodman

As we explained three years ago, we are now seeing a renaissance in the effectiveness of online display advertising because so many of the dollars have shifted from believing in certain “channels” and “publications,” to “users” and “behaviors.”

Even a superintelligent machine-learning display advertising system like adMetrica, which I love, is hampered insofar as it only learns about “places to put ads,” as opposed to “users who have a high propensity to respond favorably to those ads, based on recent behavior.”

Many casual advertisers haven’t caught full wind of the shift. On one hand, they might have been sold a piecemeal retargeting piece by a third-party vendor, and are playing around with it. On the other hand, they might still think of the “Google content network” as something that shows text ads intelligently on relevant pages, based on matching technology, keywords you feed it, or publications or URL’s you choose. And they might be unaware that various behavioral channels called “Interest Categories,” for example, do not target solely based on publication or “page,” but rather mostly on cookied users’ behavior patterns. For remarketing audiences, Google has even released a product called “Similar Audiences” to help advertisers reach a wider group than just users who have been cookied on one’s website. The idea is that Google uses statistical similarities in user behavior and attributes to try to give you another audience to remarket to — but one that you didn’t have to entice to your site in the first place. (So far, not much luck with this one, but we’ll keep trying.)

The tradeoff with doing more behavioral advertising is clear: the creep factor. Less ominously, it’s just a practical matter: we as marketers have to buckle down and stop showing repetitive offers to people who have visited our sites, abandoned our carts, etc. Sure, these efforts are extremely effective for a subset of the population, and they convert far better than typical display ads. But as Brian Easter hilariously showed at a recent SES Toronto panel on Remarketing, via a home movie of his dog rejecting the same bone seven times… if someone’s not interested, they’re just not interested.

As part of his presentation, Easter (of Nebo Agency in Atlanta) mentioned three principles (almost as asides) that still stick in my mind.

Principle 1: ”Profit doesn’t beget profit. Great user experiences beget profit.”

What I think he meant: Because retargeting is such a powerful way to boost engagement with an identifiable group of recent website visitors, it’s possible to maximize profit short-term by hammering those audiences very hard with messages. But if you want to be around for the long term, thoughtful and relevant conversations and offers are much more sustainable for the long term. Leave a little on the table now, so you can make money next year, and the year after that. Don’t forget all the efforts you’ve put into maintaining a great image and rapport with your customers just because you’re squinting too hard at the ROI column on one type of marketing spend. Among other things, use impression caps and well-thought-out audience definitions to avoid irritating people unnecessarily.

Principle 2: ”Behavior trumps demographics.”

What he meant: You’ve got Brian’s permission — and mine — to walk out of a meeting where some know-it-all with demographic research drones on about some particular target audience, as if someone’s just going to be salivating to buy today because you’ve got data that shows your product, a $35,000 motorcycle, “resonates” best with 5’7″ overweight men 28-35 with middle incomes. If a 75-year-old, wealthy, 6’6″, thin, white-haired gentleman has walked into a dealership that week and pronounced that he will “probably” be back later to “pay cash for the hog,” it’s probably worth figuring out how to craft a respectful message for (or send a birthday cake to) that near-buyer rather than bothering half the planet.

Principle 3: Don’t be lazy.

What he meant: Pay attention to image ad creative. If you’re going to be building a brand image or telling a story over an extended period of time, then craft that story in full and keep the creative diverse and interesting. The same banner over and over 50 times? The knee-jerk discounting that reduces the advertiser’s long-term ability to protect margins, sends confusing messages about brand positioning, and also costs the company margin on that particular (potential) sale? Rethink these lazy approaches to remarketing.

Grateful Friday

Posted June 21st, 2013 by Andrew Goodman

Recently, Gord Hotchkiss penned a column that referred to a panel discussion he led on, wait for it, “Is Advertising Evil?” At least he was brave enough to ask the question. There must be times when we ask how the practices in what we do for a living square with who we are. Those who simply “are” their profession, and nothing else, are puzzled by such questions. For the rest of us, we’d rather keep that “real person inside” alive… the one with a beating heart and a moral compass.

So today I came across an ad from Sunnybrook Hospital in the Globe and Mail for a High-Intensity Focused Ultrasound procedure that helped a man regain a certain brain area connected to motor function. The mention of HIFU had a personal connection for me, as we had the opportunity to work on accounts related to a HIFU process used in Canada to treat prostate cancer. Page Zero’s Scott Perry worked on the PPC accounts; our Cory Kleinschmidt redesigned a website and created an effective and respectful lead form.

The Sunnybrook ad takes us to something interesting: a fund that isn’t about specific disease, but rather the Sunnybrook Innovation Hub that builds the infrastructure and environment for experiments that can lead to great healthcare breakthroughs. Drill down and you can find out how to donate. It works just like regular charitable donation in Canada.

I’m grateful to be able to work with colleagues like Cory and Scott, and our past client in the HIFU medical field… and of course (with no professional connection to them whatsoever) to those promoting the Sunnybrook initiative in medical simulation technology in today’s Globe ad. All of whom prove that while advertising is sometimes a little bit evil, it doesn’t have to be. And every so often it is a whole lot good.

Lies The SEO Publicity Machine Tells About PPC (When It Thinks No One’s Looking)

Posted May 30th, 2013 by Andrew Goodman

As some of us know, paid search works great. It captures users with high commercial intent whether they type in broad queries, specific queries, or something in between. You can budget as little as much as you want. You can customize, test, iterate, and learn at whatever pace you wish. You get search query reports, A/B ad testing data, and much more.

The sense of tight interplay between a business owner’s wish to “go out and get some response from a certain kind of searcher” and the pace of that response can be very satisfying, to say nothing of profitable.

Nearly 100% of pages of Google Search results with high commercial intent show several text ad listings in the most visible part of the page. Think that doesn’t matter? That it somehow doesn’t apply?

Unfortunately, some experts have told business owners just that. The operators of firms that sell trendy tools to help merchants churn out blog posts and the like won’t provide balance in their marketing recommendations, for fear of undermining the value of their tools. They tell business owners that “85% of educated people won’t click on a paid link” or “sophisticated searchers in your industry are clicking on the organic links,” so “PPC is a waste of money.”

So? So? and “Really?”

I never realized until recently that much of the business community is being told flat-out lies about PPC by people who are fundamentally biased towards forms of SEO. Organic search is a wonderful thing — I’d never deny that. But when sold in a certain way, by experts that preach high marketing ideals when all they’re really doing is barely-masked, same-old SEO tactics, it’s a bit of a fairy tale. Everyone can’t get everything for free. There is only so much free to go around. And the tool vendors and evangelists are selling the fairy tale to too many people. The pot of gold has only so many nuggets to spare at this point.

The average small business owner (and by “small business”, let’s make no mistake, that doesn’t mean small dollars: small business owners are often affluent and eager to pursue best practices) is then convinced to spend months committing to a publishing schedule and listening to marketing advice that shapes the pace and tenor of the marketing strategy to the needs of the toolset vendor. Months go by. Targets get missed. Website investments of $35,000+ sit there as expensive, white-elephant fixed assets. The well-off business owner transforms themselves into a “make money in your spare time” content marketing workaholic instead of just investing a few more dollars in variable marketing costs to achieve  the needed balance.

There’s nothing wrong with content strategies, of course. We endorse them. But we endorse them for clients who are neglecting them, and who are currently spending $20,000-$100,000 per month (or more) on paid clicks. They aren’t getting cheated on high-intent paid SEM traffic.

Those who have never done PPC, and who are being told not to do it, are being cheated.

I just talked with one such business owner today. He cited all the statistics about how great organic search is purported to be for his market segment… and how bad PPC should be, if you follow the logic. I said “well, it sounds like you’re trying to create blog posts to generate traffic on some long-tail search terms, which by the way you can also do with PPC [people are often told PPC can't do long tail terms, or that it can only do long tail terms. For some reason, vendors lie a lot about what PPC can and cannot do].”

I continued: “I’d just like to see what actual referral success you’re having with that strategy. Sounds good on paper, but are you actually ranking well on many of these terms, or do you basically not show up on page 1 or 2 of the SERP’s, same as all the other more popular and unattainable terms you don’t show up for?”

He mentioned that when the tool vendor came to him, he had just surpassed 200 visitors a month to his expensive website. He had set a near-term target of 1,000 per month, and wanted to get to 10,000 a month within about a year. With an aggressive effort (something he was accustomed to executing in his long and successful career), he was going to get to 10,000 one way or another.

Then he told me he wasn’t seeing any results from following all the high-flown rhetoric of the “inbound marketing, content marketing” tool vendor. “Last month, I was around 520 visitors. This month, we’re at 587.”

Want to get to 1,000? Work and wait and believe for another year or two. Want to get to 10,000? Forget it.

587 visitors a month. That’s about how impactful “inbound marketing” is on the ground for real business owners who need real results these days. And the intent of the people who stumble into a site to read content about expensive luxury products they cannot afford? It’s non-commercial. It’s non-existent. Tire-kickers enter gibberish into the lead forms, on the rare occasions they do turn into prospects.

Are we selling solutions, or fairy tales?

For 2,000 extremely high-intent visitors, paying a healthy $3.00 per click, you’ll shell out $6,000. Certainly, that’s why many small business owners would balk at the investment, particularly when respected industry experts tell them it’s a waste of money. But what if that $6,000 turns into $75,000 in sales?

You have to at least try it. You could grow old waiting for the inbound marketing fairy tale to come true.

On Not Aping Midgeley

Posted May 21st, 2013 by Andrew Goodman

On Saturday, Seth Godin gave me something to think about. Thomas Midgeley was the evil genius advocate of leaded gasoline and CFC’s. Both have caused widespread damage; moreover, it’s impossible to argue that there weren’t alternatives. And one crucial way to prevent such damage, as relatively powerless individuals, is to avoid being complicit in the spread of harmful, profit-seeking, short-term, shortcut solutions. In the long run, such “solutions” turn out not to be terribly profitable anyway.

Seth closes with a call for “vigilance, candor, and outspokenness.”

But how does any of that relate to what people like us do for a living?

In a less obvious way, it relates. The Canadian Marketing Association, and its counterpart, the AMA, for example, have often lobbied to save marketing practices that nearly no citizen can stand, such as telemarketing. They cloak their lobbying in the guise of “ethical” marketing — while defining ethics. Maybe that’s why we recently let our membership in the CMA lapse.

In the early 2000′s, I found myself in the midst of a little bit of an identity crisis. I’d spent ten years studying democratic processes in public policy, tax policy, and involved myself in progressive causes. Now all I was doing was working in an industry that helped companies sell stuff. Writing a book to help folks make more profit. Who was I?

I’m no saint, and I sure hope you don’t think you are. :) I drive a gasoline-powered car, and got a speeding ticket over the weekend. I plan to drive to the service office to pay the ticket today. Still, when it comes to the big trends, how can we do something not to be the personification of evil?

In 2004 as I was writing about AdWords, it dawned on me that it wasn’t all bad. I realized that Google, and its AdWords program, were bent on saving the world from the pollution of interruption marketing (of the type that Godin named and shamed in his great book of 1999). In a way, then, irrelevant ads seemed to me like a kind of environmental pollution. No one is a saint, but mitigating such pollution is better than spreading more of it than one has to. I even suggested a term for the excessive proliferation of ad pollution by the mainstream advertising industry over the years: “surplus interruption.”

How can we make some small gestures this week to cut against the Midgley grain, to avoid being the “leaded gasoline advocates” of the marketing and advertising world?

I certainly don’t need to tell you to stop sending heavy paper flyers to every household in half the cities in towns in North America, because I’m pretty sure you don’t do that. That excess of unwanted paper is so great, that in another context (yellow pages books), many cities have even banned it!

Here are some suggestions:

  • Set tighter impression caps on your remarketing ads in the display networks. And bid less on them. It isn’t so urgent that prospects must be reminded (to the tune of the highest bid you’ve got in your arsenal, virtually guaranteeing placement on any network site) of their interaction on your site, again and again and again. Less is more.
  • In that vein, make all of your display ads more interesting and more topical. Is the creative being forgotten?
  • Stop writing long missives about how to do SEO that simply fuel people with hope that they won’t have to work harder on the fundamentals of their business, just as long as they figure out ways to create all kinds of brand new pages of so-called content built around different shadings of commercially-valuable keywords. Calling all of this endless production of mediocrity “valuable content” is just a euphemism for more clutter, crap, busywork, boondoggle, and subterfuge.
  • Plan a startup business model around native monetization models, transactional revenue, or something closer to transactional value. Avoid banking on massive numbers of page views and unreasonably high CPM rates. Avoid even more banking on colossally-even-more-massive numbers of page views and “junk” CPM rates that reach $1.50 per thousand impressions only because six large ad units are crammed above the fold, and another sixteen smaller ones below.
  • Re-embrace user experience and intuitive navigation. Redesign a garish, cluttered website and resolve to cut out the navigational options and excessive information, boasting, and graphical elements that don’t seem to do anything to help people find what they’re looking for. Send a prospect to a well-tested lead form instead of a home page with a tiny-fonted phone number, chunks of rambling text, and low-resolution images of two magazine covers where your shop was written up ten years ago. Stop coming up with HiPPO-driven excuses why the status quo is good enough when it comes to your website, and step back to “outdated,” “old-fashioned” basics like Steve Krug’s Don’t Make Me Think or Seth Godin’s The Big Red Fez, in which he advises “Don’t Hide the Banana.” In comparing website users to a monkey looking for a banana, Godin actually came up with a simplified way to describe the all-important concept (Spool et al., Xerox PARC Research Center) of “Information Scent.” Information Scent based design is “not just another set of opinions.” It’s important research about what works, and what turns people off.
  • Making your 800 number large and blinking does not exempt you from the above.
  • Check that opt-in email frequency.
  • If you’re a human being, please don’t automate your tweets.

The Finance Minister Who Messed With Marketing

Posted May 8th, 2013 by Andrew Goodman

In Canada, as in every country, there are many regulations governing the terms of mortgages offered to consumers. In addition to that, some of Canada’s banks (called “Chartered” banks) have long enjoyed a special, protected status. Not just anyone can open up a bank. The country’s careful rules around mortgage lending terms, amortization periods, required down payments, and mortgage insurance have seemed wisely conservative in hindsight. No greed-driven bubbles of low-quality mortgage lending… less fallout in the form of bursting bubbles and plummeting asset prices.

But everyone knows there are no formal regulations pertaining to the actual posted rates the banks provide, based on their own calculations of profitability, communications strategy, and the cost of money to the banks. Despite being regulated, if their cost of money drops, they can offer special rates. It’s up to them. And that’s just what some of them have done.

Finance Minister Jim Flaherty decided they shouldn’t. Using not only the weight of his office as a prod, but also (undoubtedly) behind-the-scenes reminders of the special breaks, insider dealings, permission to enter certain categories of investment banking activity and global finance, and favorable legislation the major financial institutions may continue to enjoy (in areas such as service fees and credit card interest rates and terms, for example), Mr. Flaherty scolded some key financial institutions when they decided (based on cheap money in the global financial system, not least of which comes from the Bank of Canada’s monetary policy decisions) to post rates for five-year fixed mortgages as low as 2.99%, as a special Spring offer. He so harassed Manulife and BMO that they reversed their promotions. The government told private companies what to do, in other words, despite there being no law or regulation on the books that prohibited it.

Apparently Minister Flaherty was concerned about a potential housing bubble. People in their 30′s with lives to lead and babies on the way apparently want to do something crazy like lock down the same kind of home ownership lifestyle that has been the norm since Flaherty and his wife bought their first home sometime in the 1960′s. And with interest rates so low (thanks to the central banks’ monetary policy), who could blame them? Homeowners didn’t create cheap money. Neither did lending institutions.

At least one bank president, a Mr. Waugh of Scotiabank, railed against the excessive government interference.

Never mind, Mr. Flaherty, that mortgage brokers, second-tier institutions, etc., rub their hands with glee at automatically now being handed the mantle of “low-rate leader.” Never mind that anyone with strong credit who sits down with their banking rep will immediately be shown the “real” rates, and if they go across the street to a white label lender, will have a rate offer in their inbox numerous basis points below that by the end of the week.

Yet, several of the largest lending institutions decided to roll over and change their posted rates… in most cases to rates above the psychological barrier of 3.0%. Those who didn’t are getting the leg up in terms of consumer attention. What unseen governmental wrath may they now face?

As usual when governmental actors overstep even the bounds of already interventionist government policy, there is a bit of a domino or trickle-down effect. In this case, it trickles down to marketing. Do you think it is just a couple of disgruntled bank presidents or board members that are affected when a large line of business is asked to take a zigzag course in the middle of its busiest season? There are millions of shareholders to think about, first of all. Millions of consumers in the market for mortgages. And whole marketing departments and advertising vendors who need to “make do” with a watered-down message when they had earlier had coherent, well-thought out plans developed around rate specials intended to raise consumer interest in an important season during a fragile economic rebound.

It looks like the government’s random jawboning in the banking sector has just made pretty much everyone less effective in their jobs. And everyone is conditioned to stop driving forward in their area of expertise, lest the wise prophet of bubble doom have another bad hair day and announce his latest viewpoint.

I rarely get political here, because it’s not the place for it. But an agent of the government telling the financial sector what they can and can’t say… from a government that came into power promising less regulation and more economic freedom? It just proves: the longer they’re in office, the less connected they are to the real interests of consumers, and the real challenges of the private sector.

I just hope that most consumers understand that the informal, non-posted rates they may actually negotiate when they sit down with a bank rep haven’t changed. And in many cases, they’re below 3%. If you’re employed and bullish about the future, it’s not a bad time to buy.


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