Marketing & Data for New Businesses, Pt. 2: SEO

I'm going to start with the rub.

As I have mentioned before, the death of traditional search has been widely heralded, and patently disproved. It is a trendy thing to write about, but has little place in today's business world, because it's a prediction that has created many fools. If you were a weather forecaster, and just showed up each day and said "It's going to rain today," you would eventually be correct, but couldn't brag too much if those showers followed three weeks of sunshine. One day, traditional search will indeed see a serious decline in relevance, but that day is not yet come.

As such, small/new businesses have to continue to care about search, and SEO in particular. Why in particular? Primarily because it is "free," but also because it can scale better than any other channel, as organic search almost automatically encompasses your entire target audience.

A search for "Elizabeth Warren" probably wanted a result about this one

So where's the rub? SEO, boon and lifeblood that it is, can be extremely difficult for new companies. In large part, this is because the number one concern of the search engines* (here I will cease deliberately referring to them collectively, and start just using "Google" or "the engines" interchangeably, because, let's face it, Google still calls all of the shots in most countries) is authority. Authority is a somewhat (deliberately) vague term that describes the likelihood that a particular result is the most common intended target of a query.

Example: If someone searches for "Elizabeth Warren," Google is going to assume that they are looking for the official website of the politician (or recent news results, or her Wikipedia page), and not a PDF of the marriage announcement of a woman with the same name from a 1978 edition of the Albuquerque Journal.

Ultimately, authority (and SEO) is about probability. The more specific the query, the easier it is for the search engine, but most users start with something fairly broad, hoping that the engine will guess their intent, and show them a set of results that contains the desired website. The problem is that for a new business, unless you are filling a niche that no one else has ever tried to fill, it's very unlikely that you will have a great deal of authority for any search other than your brand name.

It takes time to build authority, which looks at historical data, including the clicks of users following a particular query (which is one of the few times that a confirmation bias is actually an appropriate thing). However, this isn't to say that a new business should not care about SEO, just that it is a more difficult path early on.

So what can you do?  Here are a few recommendations:

• Authority is based on a lot of legacy clout. Macy's has been Macy's forever. So try to compete most strenuously in areas that are newer, for example:
• social signals are only gaining relevance in SEO, so make sure that your brand is extremely active on all of the social platforms, especially Google+
• also, make sure that for each platform, you create the right type of account, that best represents your business
• secure your site - Google has recently said that they will give slight preference to sites that are operating on HTTPS instead of HTTP; this is a pain to overhaul for sprawling legacy sites, but should be easy if you are new 

• Get it right from the start. Many companies have websites for years before they start worrying about SEO. Don't wait until you are big enough to pay a consultant to follow best practices:
• audit your pages up front - proper metadata and linking from day one
• make sure that you have enough content (500-1000+ words) on your important pages, even if some text is hidden to the viewer (but not to crawlers)
• authorize yourself as the owner of your site on Google and Bing webmaster tools, because they will be the respective canaries in your coal mine

• Publish or perish
•  Content and SEO will only be more inextricably linked, so get writing! Provide value and you will get traffic, which will in turn get you authority
• if you are going to blog or produce other types of content, keep it on your primary domain; Wordpress may be easier, but you are just dividing your 'authority points'
• if your content/blog does live offsite, make sure to cross-link it to the most relevant page on your main site, with appropriate anchor text

• Measure what you can
• On a basic level, use Analytics (or whatever you have) to keep an eye on the number of visits, and new visits (to separate people who just don't use bookmarks or type in the nav bar), from organic search
• the move to a 'not provided' world from a keyword standpoint in Google Analytics hurt, but you can see what searched terms brought organic traffic to your site in webmaster tools, so identify those queries that should be central to your business and pull that data monthly to identify trends
• Webmaster tools will also provide you with information about your rankings for various keywords, which is important in tandem with your volume of traffic from each term; use a combination to identify shifts in search behavior and effectiveness of on-page SEO

That should be enough to keep any new SEO busy for a while! It looks daunting, but the key is to just try and do the right things, generally. The engines ultimately want what is best for the consumer, and will reward sites that provide real value in an authentic manner. Keep SEO in mind with everything that you do, even if it is never the top priority, and you won't have to go back and clean it all up after the fact.

For more tips for small/new businesses, check out part one of the series.  Feel free to post questions in the comments.

Marketing & Data Priorities for a New Business

Note: Apologies, some hiccup with Blogger caused an old, unfinished version of this to be posted.  I think I captured the gist of it, and filled in the missing words.

In my career, I have worked with some very large, mature companies while on the agency side, and in-house with a small-to-medium sized business, though closer to small at the time when I joined.  I bring this up because a colleague of mine recently decided to leave our thriving enterprise to join a start-up, as one of the 'first five.'  I think that everyone considers what it would be like to work for a company from the very beginning, no matter his or her profession, and so it got me thinking about what I would do in that position.

I would guess that for many people, myself included, the attraction of working for a start-up as an early employee isn't about the beer cart, the foosball Fridays, or even the stock options, but about the ability to come in and practice our particular craft on a tabula rasa.  Deep down, almost everyone who is good at what they do thinks that they could be a little bit better if not burdened by the ghosts of business past.  Every company evolves over time, but like a city, new growth is inevitably on top of the old, no matter the lengths that you go to clear the site.  I've never met a developer who hasn't been frustrated by old code, an SEO who understands why a website was built a certain way, or a DBA who would design a database the way he found it.

Obviously, I think that it probably goes without saying that most of these legacy problems are not the result of incompetence, but rather a combination of a lack of foresight, and the normal "things that happen" over time.  We can assume that most of the people who build the legacies that the rest of us inherit have good intentions, but lack the luxury of building a foundation that will stand the test of time.  The key, for our hypothetical selves at start-ups as it was for our real-life predecessors, is to wed the long-term concerns with the immediate business needs of the fledgling company.

So as a thought exercise, here are some considerations and strategies that I would prioritize if I found myself moving to a brand new company:

Advertising:
Think about your target audience, and how they gather information.  Chances are, budget will be an issue, so the most important things will be efficiency and extremely narrow targeting.  There is always a natural progression of one platform at a time, but that's a mistake.  The evidence all points to a multi-platform strategy from the beginning.  I hate to fall back on a cliche like "synergy," but it is easier than actually explaining the math.  The point is, launch your content, social, paid social, and paid search all at once, even if you only do a limited amount of each one.  Coordinate them, because they amplify one another, and you will maximize the effect of your spend.

• Know your audience
• What need does your product fill, who has that need?
• If you had that need, how would you go about satisfying it? Try it.

• Make sure that you have a keyword strategy that looks beyond CPC to CPA/CPE or whatever your target user action is
• Note that this means you will have to track everything FROM THE START

• Know your budget, and what will fit into it
• Set some money aside for testing, maybe 10% at first
• Start with very tight keyword groups, be proactive with matchtypes and negative keywords, and watch any GDN or YouTube spend carefully
• Careful targeting is better for conversions and budget, so start with only your own country

Content:
Produce as much of it as possible, make it valuable, don't make it sell your own product.  Mix your mediums, make sure that you think about the life cycle of each piece, and how you can distribute it.

• Ensure that you have a place for content to live permanently, preferably on your site.  You want a link that can live forever
• Use your content as a source of advertising material, from keywords to messaging.  If you find yourself saying something a lot in your content, it's probably important in your industry

SEO:
This is one is simple on the face of it, but also one of the easiest matters for a new company to overlook and one of the hardest things to plan for as it grows.  Generally speaking, your best bet is to everything right, but here are a few ideas that you can start with:

• Make sure that every page that has clear focus
• that you explain that focus on that page with at least a few hundred words worth of text
• and that you repeat that focus very concisely in the metadata  
• Make sure that your URL structure is logical 
• clear hierarchy in the sitemap based on importance of the page
• hyperlink deeper pages to appropriate higher-level nav pages using relevant anchor text

Data Collection:
Set yourself up with a Google Analytics account immediately.  It doesn't matter if you plan to use another web tracking platform down the road, you want to make sure that you are measuring out of the gate.  This is free, and it will join to your AdWords account to give you significant targeting benefits.

• Don't just stick to the out-of-the-box defaults with GA, spend the extra time to make it fit your needs
• Activate ecommerce tracking if need be, and add the little bit of code (seriously, like one line) needed to gather demographic data
• Add events and goals to customize your map of the customer journey
• are there key pages you want to track? forms? videos?
• think as you build your site, about every key interaction you will have with visitors from discovery through whatever signifies success, and be ready to track each step

Don't feel limited to Google Analytics for your data collection and housing, either.  It's great for one part of the interactions you will have, but there is more to your business than your website, and you will want information from other sources as well.  MS Access will do if you have loads of CSV files or similar data that will overwhelm Excel, but eventually you may need to move to a SQL database, or other RDB.  Maybe you want to skip that, and go straight to NoSQL, given the direction that the business work is moving in.  With AWS and Google Cloud, storing data in a non-relational manner and then accessing it freely with MapReduce jobs is becoming easier and cheaper every day.

The point is, track everything.  Collect all of the information that you can from the get go, because you will always think of things down the line and wish that you had tracked them all along.  Starting with day one, you will be asking questions about your customers and your business that will have profound effects on your marketing strategy and execution.  Give yourself every chance to make informed decisions whenever possible.

There may be more to follow this, but I wanted to get it out before the new year.  Good luck in 2015, especially if you work at a new business!

Don't limit yourself

Ad Viewability Matters, But Let's Not Overreact

The issue of display impressions, both how they are measured after delivery (in terms of tracking effectiveness for marketers) and how they are measured at the point of delivery (in terms of accountability for publishers), is whether anyone actually sees them.  There are really two problems here, both of which the IAB (Internet Advertising Bureau) has tried to address recently, though it remains to be seen if they can have any effect.

The first issue, and one that has been well-publicized over the last year or so, is the prevalence of non-human traffic hitting website servers.  Depending on who you believe, this traffic, whether from deliberately fraudulent bot networks or innocent (though equally irrelevant) spiders and other web crawlers, makes up anywhere from 15% to 50% of server requests, the implement by which impressions are "served."

The second issue is that even if the site visit is from a real person, there has historically been little or no attempt made to determine if the user was ever able to see the ad itself.  For instance, if a page loads but the particular inventory that was purchased is below the fold, and the user then clicks a link in the header to leave the page, an ad impression would be recorded despite the fact that it never appeared on the screen.  The New York Times ran an article about this not long ago, which helped bring attention to a wider audience, but largely covered existing topics of discussion.

The IAB's attempt to define "viewable" impressions and instruct the marketplace to deal only in those impressions that fit the description (“must be in the viewable portion of an internet browser for a minimum of one continuous second to qualify as a viewable display impression”) is well-meaning, but unfortunately fraught with problems.  Basically, if those conditions either aren't met or can't be guaranteed, they recommend that publishers don't sell that inventory and that media buyers don't pay for it.  And it is here that we marketers run into a bit of a conundrum.

As digital marketers, one of our big selling points for years, in terms of justifying budgets, was the fact that digital is just so much more measurable than traditional advertising channels, which in turn meant that we were comfortable being more accountable.  Over time, it became clear that display ROI wasn't quite so cut-and-dry as search and other direct response marketing, but we were quick to assure those who control the purse strings that it was ok, because we could still measure the impact.  Using a variety of modeling techniques and brand lift studies, we claimed that we could show the benefit of display advertising on other channels, whether it was increasing searches on our brand terms or improving conversion rates on page for those exposed to a display ad.

So now that we find ourselves balking at the fact that we may, in fact, have been paying for bogus traffic all along, we are in something of a bind.  Some marketers are suggesting that we should simply not purchase inventory from those publishers and networks that can't promise "viewable" impressions now, but I don't see that as feasible.  For one thing, a lot of people selling inventory, especially targeting niche audiences, simply don't have the technology built into their ad serving to track and guarantee such things.  More importantly, however, the idea of cutting off a channel for this reason has a real logical flaw to it.

Here's the deal, the product (display impressions) hasn't changed significantly, we are simply more aware of shortcomings than we were before.  So, if we are going to suddenly tell those to whom we marketers are accountable (boss or client) that we should no longer be buying certain inventory that we used to be, we are forced to acknowledge one of two things:

1.) The product has always not been worth what we have been paying for it, and thus all of our past attempts to demonstrate its value through various methods have been either inept (bad), or deliberately deceitful (very bad).

or

2.) The product always has always been worth purchasing for all of the reasons that we said it was, and still is, but we are recommending shutting off that valuable channel for what essentially amounts to moral reasons.

Since the whole point of most measurements for display had to do with the results, not the delivery itself, what we should be able to say is something like the following:

"Even with what we now know to be only 65% viewable delivery of purchased impressions, we have still been able to achieve [X, Y, and Z beneficial results] on our display campaigns.  While we will continue to work with our publishers and providers and encourage them to improve their delivery methods, recent industry findings have done nothing to change the core value returned by past campaigns, nor do they suggest any reduction in returns on future campaigns, even if circumstances remain the same.  As such, we do not recommend any change in current investment in this channel."

Some marketers seem to be tempted to cut off their noses to spite their own faces, but this is a wrong-headed approach.  There is a solution here, and it is a market solution.  In the same way that demographic information and services like comScore have allowed inventory sellers to specify their audience and separate into tiers that are reflected in pricing, so too will these provably "viewable" impressions command a premium.  This new information may give media buyers a little more leverage over pricing with some publishers/networks, but it doesn't give us the ability, or need, to re-write the history of our past results.  Think about it this way: if display has been as effective as it seems despite so many served impressions never being seen, there is basically nowhere to go but up.

I for one, however, will certainly be looking for a lower CPM next month from those providers who can't make the '50 %on screen for one continuous second' guarantee.

Top 5 Skills for the Modern Marketer/Data Analyst

[Skip to the bottom if you just want the top 5 list]

Over the years that I have been in digital marketing and analysis, I have been constantly shocked by the gaps and deficiencies that I have found in not only my own, but the entire industry's skill set.  When I first began as a lowly search specialist, I came in with nothing more than a decent understanding of how organic search engines worked, a basic familiarity with Excel, and a passionate, though amateurish, interest in statistical theory.  Within three months, my relevant knowledge base had expanded exponentially, but still I felt that I lacked useful skills, and frankly, that most people in the industry did as well.  I have been trying to rectify that situation ever since.

Right off the bat, I was amazed at how little rigorous statistical analysis was being applied to SEM and other digital media buying and planning channels, given the volume of available data that was being (or could be) collected.  This was manifest not only in the proportion of data analysts to account team members (which was very low at the time), but also in the absence of fundamental conceptual understanding of statistics held by the marketers themselves.  It was naive of me to think that every account team would have a dedicated analyst (though I had assumed as much before my first day), but even at the time I thought that some rudimentary education on the theory and practice of utilizing data sets should be a prerequisite for a digital marketer.

Even more simply, I realized quickly that my Excel proficiency was not where it needed to be, or at least not at a point that my work couldn't be substantially improved by getting better with spreadsheet applications.  What I thought I had known about Excel (still one of my all-time favorite human inventions) was a drop in the bucket compared to what I felt like I ended up needing, but as I developed those skills I was once again shocked by their conspicuous absence from the average marketer's tool kit.  The number of people in our office who really knew Excel, and could maximize the efficiency of its capabilities, was limited to single digits, even though it is the bread and butter of any search marketer.  From there, overly large data sets led me to need to use MS Access, a program which even fewer people were qualified to use, causing all kinds of missed opportunities and bottlenecks.  While most people in every office that I have ever worked in tend to just seek out those who have that knowledge when they need it, very few companies require, or even encourage, widespread acquisition of information and skills that are borderline critical to the work their employees do.

When tagging and tracking issues came up (and they always do), I found myself frustrated by the gate-keepers and communication disconnects that exist between marketers and IT/website maintenance teams, so I realized that I would have to understand (at least at a rudimentary level) HTML, and then JavaScript.  I had to learn more principles of SEO at times, which also required understanding of those basic web development languages.  I had to understand other marketing channels to really see interactions, I had to understand offline sales processes to gain insights into lead generation marketing, which meant that I had to first learn about CRM pipelines, and then CRM platforms like Salesforce and Hubspot.  As the lines between social, paid social, content, and SEO blurred, I had to approach each subject in turn; in order to understand any one of them I had to understand all of them.  To understand what my data meant I needed to know all of the data that was collected, so I had to learn about databases.  In order to make use of the databases, I had to learn SQL.  I'm so far from where I started, and yet still so much further still from where I need to be.  I will never have enough knowledge and understanding to do my job as well as I think I should.

But at every step in my career I have been surprised to see just how many people in the industry lack not only the skills that I have been seeking, but even the awareness of the roles that they should play, within the agency world and without.  For so many years everything was siloed in terms of labor division that marketers (and really, everyone in business) came to believe that the world outside of their specific responsibility was segmented this way as well.  There is this common theme in the industry today that those walls are finally breaking down, that channels are at long last interacting and that the ecosystem has finally become diverse and highly dependent, but this is a false concept.  The ecosystem has always been complex, and the fact that we are finally starting to recognize it doesn't excuse us from responsibility for the gaps in the past, nor the continuing specification of skills moving forward.

A search marketer can't get away with simply knowing the AdWords and Bing platforms anymore, or at least shouldn't be able to in your workplace.  Would you want someone in charge of a campaign that doesn't understand how the tracking codes work in a jquery library?  Do you want someone presenting to clients or superiors not only raw information, but conclusions and insights, who doesn't understand sampling concepts, or how to differentiate between correlation and cause?  How can a marketer assess the value of a user action without understanding the offline sales process, or the difference in the consumer journey for B to C versus B to B?

For so long digital marketers were like Oz, we claimed to be wizards and got away with it because no one looked behind the curtain.  People finally looked behind curtain and found that in fact, it was all done with machines, and they were actually fine with that, because we said we were running the machines expertly.  The problem is that now digital marketers are often demonstrated to simply be the people standing next to the machine, with no more understanding of how it works than those who were on the other side of the curtain.  In order to stay relevant, we all need to not only be able to read the outputs, but understand and interact with the inputs as well.  The world is changing fast, and education, in any form, is the only path to relevance.

So to sum this up into a top-five list (because that's what the internet wants), here we go:

Top 5 Skills for Every Data-Driven Marketer

1.) Microsoft Excel (custom sorting, formulas, pivot tables)

2.) Basic Statistical Theory (samples size & significance, correlation vs causation, variance & standard deviation)

3.) CRM Process/Offsite Interaction (digital is not a separate realm, it is part of the broader business we engage in)

4.) Minimal HTML, JavaScript knowledge (metadata tags, H1s, how API calls work, tagging intricacies & common problems)

5.) SQL/RDB Querying (pick one, MYSQL, PostgreSQL, even NOSQL, it doesn't matter; maybe learn R or Hadoop if you want to get fancy)

Income Inequality is the New Market Inefficiency (aka "Marketing Moneyball")

I think that there is a good chance that the new market inefficiency is income inequality. 

                There is no question that the distribution of wealth, as well as income in this country has grown more uneven over the last couple of decades.  Whether or not you care about this or find it “bad” is irrelevant to this discussion and a topic I am not going to touch, but the fact that the gap is widening is not a debate, it’s a matter of public record (the government is good at keeping track of other people’s money).  All I care about here is what the effect is on brands and advertisers.

Here is a table of income distribution in the US over the last 30 years:

	Top 1%	Next 19%	Bottom 80%
1982	12.80%	39.10%	48.10%
1988	16.60%	38.90%	44.50%
1991	15.70%	40.70%	43.70%
1994	14.40%	40.80%	44.90%
1997	16.60%	39.60%	43.80%
2000	20.00%	38.70%	41.40%
2003	17.00%	40.80%	42.20%
2006	21.30%	40.10%	38.60%

                What we are seeing is that the bottom 80% of the country has seen their share of income decrease by 20% over a period when the US as a whole saw strong economic growth as well as a population increase.  The amount of purchasing power lost when over 200 million people see their relative income decline is staggering.

Before you say that it is misleading because it is relative to the total growth in wealth, the answer is that it’s not.  Professor G. William Domhoff of UC Santa Cruz pointed out that from 1983 – 2004:

“Of all the new financial wealth created by the American economy in that 21-year-period, fully 42% of it went to the top 1%. A whopping 94% went to the top 20%, which of course means that the bottom 80% received only 6% of all the new financial wealth generated in the United States during the '80s, '90s, and early 2000s (Wolff, 2007).”

How does this all tie back to brands?  I mean, there is more money in the country, so does it matter who is spending it?  Well, that depends on your brand.

BMW is going to be just fine.  The number of people who had the buying power to get a luxury car remains the same as before, even in a down economy.  If you are a brand that relies on a broad consumer base from the upper-middle class and down however, there is a good chance that this is a paradigm shift, rather than just a short-term cycle.

Brand managers are not economists, so it is understandable that a lot of them would look at poor sales data over the last few years and think, “Well, the economy is down, so everyone hurts, but we will come back with the recovery.”  There are several problems with this though, and the biggest being that despite what the man on the street might think, there has been positive, though slow, growth for the last several quarters.  Like our hypothetical brand manager though, this assumes that the growth is evenly distributed, but the reality is that it is focused on several sectors. 

The recent market troubles provided a volatility that muddied the economic waters to a degree, obscuring long-term trends by drawing focus to the post-2008 environment, focused on housing and finance.  The problem is that overall GDP growth and wealth creation is no longer increasing the buying power of the widest part of the consumer base in this country, and brands need to recognize this.

Think about it this way:  You make Tide, or Gain, or some other name brand laundry detergent.  Total amount of money in the system is increasing, but primarily flowing towards a small number of people who already hold a disproportionate amount.  The vast majority of your consumers have actually seen their real buying power (based on income levels pegged to an inflation index) decrease, so they move to cheaper store brands, or buy your product only when there is a coupon/discount offer.

For your brand to just break even, the top 20% of earners in America would have to suddenly start consuming more of the same product, without adding any new consumers.  So the well-to-do family, which has gone through 1 bottle of Tide per week forever, suddenly has to start using 3 of them per week.  Rich babies will need to start dirtying their diapers at a much higher rate inexplicably.  This isn’t going to happen.

We have seen an explosion in interest in savings, discounts, and couponing.  There are huge blogs dealing with the subject, and even multiple television shows.  Cable subscriber rates fall along with telephone landlines, lagging by ten years.  The important thing is realizing that this behavior is not symptomatic of short-term economic slowdown, but long-term trends that started well before the banking crisis.

Growth will slowly increase over the next 6-12 quarters, and unemployment will slowly drop, but probably not to pre-2008 levels any time soon.  Meanwhile, population continues to increase, almost entirely in the bottom 80% of the income scale, which still possesses the lion’s share of purchasing power in this country.  For a lot of brands, krazycouponlady.com is more relevant to their consumers than BMW, and they need to embrace that.  When the economy comes back, they can’t be surprised that their sales never fully returned, and that their profit margins actually shrank.

The flipside of this is that there is a huge opportunity for brands that recognize the shift and respond to it first.  If General Mills stubbornly tries to stay the same, and cover their cereal boxes with QR codes that drive to an altered-reality experience (which is not cheap), while Kellogg suddenly cuts overhead and production costs, accepts a slimmer margin but positions themselves as the middle ground between store brands and premium brands, they will reap the benefits. 

The majority of buying power as a market group has shifted down a step, roughly 20%, compared to the post-WWII era which saw the growth of the middle class and a large industrial/manufacturing sector when many marketing practices and brand identities were established.  We have entered a new reality, and the brands that accept this first will have a vital head-start in dominating the “new middle-class.”  Advantage is gained by exploiting market inefficiency, and failure to differentiate between overall economic market conditions versus buying power demographic shifts is that inefficiency.

Is Marketing Really "Data-Driven?" Pt. 1

               No matter what you call it, the clear trend in marketing today is towards a model that depends on consumer data collected digitally to inform both online and offline media strategy.  Terms like “data-driven” and “fast-moving data” are bandied about, conjuring up an image of an agile, precise campaign that links brands to individuals, rather than demographics.  Marketers know that the shift from art to science is already in progress, and I should say that I wholeheartedly agree with this approach.

                The problem is that there is a danger in a job only half done, and at times I fear that we as an industry talk about “data-driven marketing” like experts, but that there is no rigor to the approach.  Additionally, using digital data to inform traditional media, both in terms of planning and creative, when the same statistical approach isn’t applied to those channels, will return misleading results.  No matter how cleverly you apply your digital learnings to traditional performance, if the metrics by which we measure TV are inaccurate, or not properly tied to business goals, then we risk just painting a picture that is different but no more insightful.

                To truly claim a data-driven approach, you need to collect data at every step of the marketing process systematically, and analyze it methodically, adhering to sound statistical procedure.  Just as importantly, you need to know what data to gather, and how it helps you to achieve your goal.

                Let’s start looking at an example of how this can affect measurement at every level of a campaign.  Starting with the broadest, what is the goal of marketing?  To increase the sales/services provided of the client.  How is that measured?  Brand loyalty?  Market share?  Sales in dollars?  Profit?  Units sold?  The first thing that an advertising agency has to do (ideally) is identify what the client goals are, and frankly, the media agency should be the one that determines the goal, as it is part of the marketing process.

                Why is that?  Let’s look at the list of client goals that I mentioned above, all of which at first blush appear to be totally normal, reasonable ways to judge a marketing agency, but all of which have some issues from a statistical and/or business standpoint.

Brand Loyalty: This is probably the worst measure for a number of reasons, over and above the fact that it is a vague concept.  Anything that is survey or panel based can be looked at, but the methodology and sampling issues make it less scientific. 

Market Share:  Better than brand loyalty, but because the information has to come from a number of outside sources makes the gathering of this data ponderous, and more importantly there is a long time lag for reporting.

Sales (dollars): On its own this number is somewhat useful because it is an absolute 1-to-1 value, but it really should be adjusted to account for the market environment of the client’s particular category, rather than taken raw.

Profit: Terrible.  I don’t think that anyone would actually measure a company’s marketing success based on profits, but it is something that clients think about and a useful illustration about what stats you don’t want.  Too many uncontrolled variables go into profit and revenue numbers.  If a company sells more product but the cost of raw materials increases as well, it shouldn’t be factored into any measure of advertising.

Sales (Units): This is probably the best way to measure overall advertising success over a long period of time, once again normalizing the number to the broader market conditions.  By using sales in units you remove some of the variables around pricing and competitive environment (aside from the ones that can adjusted for).

The key to any good statistical measure of success or ability is removing as many uncontrolled variables as possible, and not crediting/blaming advertising for things it can’t control.

Since I often use baseball as examples for statistics and how to use them, the perfect analogue here is using ‘wins’ to judge a pitcher.  Conventionally, people looked at wins to determine how good a pitcher is, but that number is quickly falling out of favor, because it has very little statistical relevance to how well a pitcher performs.  Think about it, if a pitcher gives up 5 runs but his team scores 8, he gets a win.  If another pitcher gives up 2 runs but his team is shut out, he gets a loss.  Who did a better job?

The lesson is not that we shouldn’t measure things and use the data as much as possible, but that not all stats are created equal, and that we need to make sure that what we are collecting is telling us what we think it is.  Right now I would say that marketing is getting good at amassing data, but still extremely infantile in terms of manipulating it properly.  We are still at the stage of evaluating pitchers based on wins, as it were.

Some of this is also based on assumptions, and how many of them are based on traditionally held marketing beliefs that we take for granted, despite never seeing empirical evidence for them.  Every marketer should be a gadfly.  Poke holes in theories or justifications that don't make sense.  If you see a test that doesn't account for uncontrolled variables in the results, point it out.  If a conversation is centered around an idea that everyone accepts but no one has proved, ask why.  

Next up, it might be worth looking at TV, and the relationship between digital/social and offline, in order to challenge some of the preconceived notions.

Google is Shaking Things Up (Again)

What's missing in this picture? (Hint: paid ads on the right side)

The big news for advertisers to come from Google lately (and yes, I am ignoring the organic algorithm change for right now) is that they are changing where paid ads are going to appear on the search results page.  For all of the claims that Google is a power-hungry, money grubbing monster, I have to say that as an advertiser, I don’t generally see that being the case.  In fact, I am normally frustrated by things they do in order to improve the user experience because they run contrary to what I would like as a marketer.  This latest decision, to move paid ads from the right-hand rail to the bottom of the page is no different.

The first issue that we have to consider is user behavior.  Thanks to eye-mapping technology (they plop users down in a chair, tell them to navigate the search page, and have a camera mounted on top of the monitor to track their eye movement as they look around the page; not clear if they hold the lids open Clockwork Orange-style), studies have been done telling us how people actually view the SERP (search engine results page).  Combined with click data on the various links, we have a pretty good idea of how users see and interact with the search engine results, and as Google has changed the layout and result types that show up, user behavior has changed as well:

SEOmoz studied the effect of Local & Expanded Sitelinks

Basically, what we have seen in the past is that most people tend to view the page top-to-bottom, and only occasionally do their eyes wander over to the margin, unless it is a relevant part of the answer to their query (like a map or a video).  Thus, Google feels that putting those paid ads that don’t make it into the prime top-of-page slots will actually be better served at the end of the organic results, due to the natural progression of users through the listings.

I know that for organic results there is some basis for this, as listings in positions 9-10 often actually have a better click through rate than those in positions 7-8.  The idea is that we tend to gloss over the middle results, paying the most attention at the beginning, and then at the end when we are forced to decide to either click on something on the first page, or make the (increasingly rare) decision to see if page 2 of the results will have something more to our liking.

Google thinks that CTR will increase at the bottom of the page compared to the right rail, but we will see.

The other issue is a purely mathematical one for advertisers.  Where you once had 6-8 paid search results on a page, it will not be uncommon to only have 4 results, which is what I tend to see now when I get these search result layouts.  Two on top, two on bottom.  Now, if there are fewer first-page ads available, then simple supply & demand tells us that competition, and thus cost per click, is going to go up. 

Google is not saying that 2^nd page ads are going to see improved performance, so this is strictly a cut in inventory.  Everyone wants to be on the first page, so get ready to see your CPCs go up (and presumably CPA as well, all other things being equal). 

Now, I have already heard the argument that this is Google’s way to make more money from ad revenue.  Higher CPC = more fees for Google, right?  Probably not.  Think about it how much CPCs would have to increase in order for them to make up for the revenue lost by having their total first page ad inventory drop by as much as 50%.  If anything, Google is most likely costing themselves money, because people who find that their bids have moved their ads to the second page are just as likely to pause the keywords as they are to increase the amount they will pay for them.

I don’t love this change as an advertiser, but it is once again going to be hard to argue that it isn’t better for the user.

Yahoo! & Their Social Media Integration

Yahoo has recognized that their value offering to the marketplace isn’t search, and it that this has essentially been true for a while now.  Since last fall, Microsoft has been serving Yahoo users Bing results, and Bing has been eating into their share of the search space as well.  Therefore, the decision makers have wisely chosen to focus on their core competency, which is being one of the most visited content hubs on the web.

They recognize that they can’t remain static though, and that social and sharing is the future of the digital space, especially for marketers.  Plain old banner ads will always have their place, but they just aren’t targeted or engaging enough on their own, and they lack the sexiness of more recent ad units to hit the market.  Thus, Yahoo decided that they would team up with Facebook, and create what is actually a pretty interesting experience platform that attempts to blend paid and earned media more seamlessly than any other.

Essentially, by linking your Yahoo login to your Facebook page, what you get is a carousel/toolbar that consists of your friends faces when you are anywhere in Yahoo’s properties.  If you hover over any of those pictures, it will show you what that friend has been reading/sharing (within Yahoo).  It also has a feature that will show you any comments that your friends have made regarding a piece of content, which allows you to essentially combine your content consumption with social dialogue, and will push your comments out to appear on your Facebook page as well.

The advertising part of this comes in the form of new ad units that they are creating.  Essentially these “road block” or “pause sign” ads will be branded banners set at the bottom of an article, which contain a question, or quiz, or other interactive feature based not directly on the products/services of the advertising company, but on the content that the user is looking at, in the form of a “sentiment slider” that the user can move along a continuum to express their level of agreement with a particular statement.  The example shown to us was in a travel article, and the unit asked the reader to choose which option was his/her dream vacation: skiing in Tahoe, laying on a beach in Hawaii, or hiking in [some good hiking place].

The ad featured a small JetBlue logo, but upon clicking a choice the user was given the option of sharing their choice in Facebook, which would link to the poll unit and tell all their friends that they like skiing, or hiking, or what have you.  This would then lead other users back to the content, which is theoretically relevant to them, and another small JetBlue sponsored item in the sidebar, as well as a traditional JetBlue ad at the bottom.  All very cleverly integrated so that the user can interact with the content and their social network without ever feeling like they are having a product pushed at them.

The product seems decent, and the integration itself feels like a well-built technology, in terms of user experience.  The automatic nature of the passive sharing part of this collaboration, the part that automatically tells your friends what you are reading on Yahoo, will probably be very popular, though I will be curious to see how many conversations occur in this space.  As an advertiser though, I have a few issues with the new unit.

First of all, and this is probably just my bias as a search marketer, I don’t really think that it should be a CPM (cost per million impressions) buy.  It is contextually targeted, though only at the vertical level, rather than keyword (this also feels like a missed opportunity for relevance), and Yahoo simply chooses a bundle of articles for the ad to run in.  Given that the entire pitch and idea is built around interaction however, between the brand and the user, the user and the content, the user and their social network, etc., it really feels like this media should be bought on a pricing system that is also based around interaction.  When I brought this up to Patrick Albano, who is Yahoo’s VP of social, mobile, and innovation, he said that that was something they might consider in the future.  I am not holding my breath.

The other thing is that the whole point of not having a regular ad unit that contains product/brand messaging to drive the user to the company’s online assets (either website or social platform), is that this unit is not really supposed to feel like advertising, it is supposed to feel like part of the content.  If that’s the case, and since they themselves used the “pause sign” terminology, I think that interaction rates would be much higher if they moved it to the fold, and plopped it right in the middle of the article, to actually make it feel like part of the content.  If you put something all the way at the bottom of the page, a lot of people aren’t going to take it in or associate it with their consumption.  When I made this suggestion, they were much more receptive and indicated that it could actually be something they change after it has been in the market for a bit, maybe Q2 next year.

The last issue, and this is often a problem with advertising in the social space right now, is measurement.  They seem a little unclear on success metrics, or even anything beyond clicks, but their idea is to build a brand favorability/purchase intent study into the cost of a buy.  Given that it will have to be survey-based, that seems like a rather ham-handed way of tacking “value” onto the offering in order to help justify selling in the cost to clients.  It’s a very non-scientific, ethereal thing to try and measure when onsite interaction seems like the obvious way to go. 

Overall, it’s an interesting new experience for users and advertisers, but it is a product that I will be happy to wait for, and just sit on the sidelines for the initial phase, instead of rushing to get in line for this. 

Believe in Yourself Bing, Because No One Else Will

Much has been made of some comments made at this year's Web2.0 conference by Microsoft CEO Steve Ballmer.  Especially an odd sort of back-handed pitch for his own search engine:

“Take any search you want and try it out on Bing, and try it out on Google... 70 percent of the time, you probably won’t care, 15 percent of the time you’ll probably like us better, and 15 percent of the time you’ll like the other guy better.”

So let me get this right:  Your argument is that people should switch from Google to Bing, because your product isn't specifically worse?  Steve, are you unfamiliar with the concept of 'damning with faint praise?'

This would be like my grandmother saying that I am not a bad looking kid.  Does that happen?  No, every grandmother thinks her grandkids are the most beautiful in the world, no matter how homely, and they should.  If the CEO of a company can't say that his product is the best, how is anyone who isn't biased supposed to think so?

Hell, if you are just going to make up numbers, which is clearly where the 70/15/15 came from, at least say that it is 70/20/10 in favor of Bing.  What, you can't even give your own people a 5% edge?  Hell, call it a margin of error, they are fake numbers anyhow!

This has to be one of the least inspirational plugs, and frankly, I wouldn't be thrilled if I actually worked at Bing.  You expect your boss, the public face of the work you do every day, to go out there and at least say that you are the best, even if behind closed doors he pushes you to be better.  There is nothing wrong with saying "we have work to do, we can always get better," but this feels like a defeatist attitude.

It's bad salesmanship, and it's bad leadership.  For shame, Steve Ballmer

Google+ : What's Their Angle?

With Google+ finally rolled out to the general public and membership reaching 40 million users, the question becomes not whether it will be successful, but has it already peaked?  We know that brand profiles will be available soon, but beyond that what offerings are on the horizon to make this social network a daily destination, rather than a set-and-forget option in your Gmail account settings?  What is Google really after here?

Their search engine, the bread and butter of the Google empire, still holds around 60% of the market share, with the rest carved up between Yahoo and Bing, and to a lesser degree Ask.com and AOL.  You have to figure that if Google could get their social service to take a similar 30% bite out of Facebook, they would be absolutely thrilled.  Are they likely to do that though?  How many people do you know who have signed up for Google+ and stopped using Facebook?  Right now it seems more like a curiosity than a platform that people are going to move over to full time.

Normally to make a new market entrance like this really successful you want to have some integration in order to take the burden off of the user.  As of now, one of the main complaints that you will hear about Google+ isn’t that the features aren’t attractive, but simply that the initial set-up is work, and more importantly, work that the users have already done on Facebook.  Inertia is a powerful force, and people don’t like having to do the same thing twice.  If you could import your friend list, copy all of your “likes” as ”+1s,” and port your privacy settings over, it might be more attractive, but there is no way that this unholy marriage will ever be consummated.

Which brings us back to the question of, “what is Google’s” long-term strategy here?”  Are they simply looking to get users to spend time on another of their properties so that they will have space for a few display ads? 

In marketing, Facebook ads are certainly something that people are paying for, though the results have been mixed and there is still relatively little information provided in terms of on-site metrics.  Measuring the success of a FB buy is difficult, and the question of whether to direct users to a brand site versus a profile page remains unanswered, depending on the goal of the campaign and whether one platform or the other holds some sort of unique user experience like a contest or a promotional giveaway.  The advantage to Facebook ads is almost entirely in the demographic targeting that is available, which makes sense given how much personal information people include in their profiles.

Still, to make that attractive as a marketing feature, you need a certain critical mass both in terms of the number of users (since for any given company/product you are only targeting a narrow slice of the consumers), as well as the time that they spend on the network per day (since they won’t see many ads if they just log in and log out).  Google+ has nowhere near that volume yet, and won’t soon, as they are still below 10% of the membership that Facebook has.

The “hangout” real-time meeting function offers a bit more interest and utility, and is certainly an offer that is distinct from anything that Facebook does, but it is a very limited engagement option, and it isn’t a hub that people will spend hours logged into every day.  As a multimedia tool it is appealing, but not necessarily a draw to the casual social networking user.

Really, you have to figure that for Google the goal here is just to be able to collect more user data, and be able to connect it to the vast archive of data that they have already.  Imagine if you could marry the personal information that users put in their Facebook profile, to the detailed search logs that are created when those users look things up in Google.  The dossier that Google will be able to produce on 50-100 million users will be so detailed and in-depth that the retargeting (and regular targeting) options will be incredible.  Having not only demographic information to target your consumers with, but also an explicit search history will allow an even greater level of ad relevance than Facebook can offer now (which is why people wonder why they haven’t gotten into the search game yet).

Taking this one step further though, I wonder if what we are seeing won’t lead back to Google TV.  Remember that idea?  When your television was going to become your main point of contact with the internet as well?  I wonder if they are not setting themselves up for an incredible targeted TV buy application in the future. 

Think about it:  The real problem with television advertising has always been a lack of targeting capability.  You can show during certain times or on certain networks when you think your targeting audience will be watching, but other than that you are just blasting your message out into the world and hoping you hit something.  It is the shotgun approach to marketing, and not very efficient.

But imagine if your consumers have Google TV.  They are logged into their profile to see if they have any messages from friends (or maybe they just finished a “hangout” using the built in webcam, or a partnership with Microsoft and their Kinect hardware), then that runs in the background while they watch television. 

Suddenly, Mountain Dew wants to buy an ad, and Google can say to them, “we will show your TV spot only to males, aged 14-32, who have listed an interest in mountain biking, extreme sports, computer games, programming, soda, rock music, Doritos, or whatever else, based on their Google+ profiles.  You pay based on the available impressions that we can give you at whatever time, so if it is 8 pm. on a Thursday and there are 2.4 million people who fit the criteria that you set up, we will deliver you TV spot to all of them, and only them, for $XXXX.”

Think of the revolution in advertising that could take place if Google can just get people to be logged into the device that they watch TV on.  Suddenly, most of the inefficiency of TV buys disappears, and Google has a massive back-door entrance to a marketplace that they have only recently established a toe-hold in.  How this would need to be structured with the networks is another thing, but as more and more media is consumed on YouTube, Netflix, and Hulu even that problem becomes more manageable.

Google doesn’t have to fight Facebook, they just have to play in the space long enough to gather the user data that they need.  How does this not make sense?  If it isn’t Google’s plan, it should be.  More specific targeting is the trend in the advertising world, and this is a way to bring search-level relevance to the massive budget world of TV, with Google in prime position to lead the charge, if they can only put all of the pieces together.

This may only be a wild theory today, but check back in a few years.  I will take wagers.

Is Data a Big Deal in Advertising?

How does this still qualify as a question when it has been answered?  Enough to warrant a "big prediction" and a panel discussion?  Apparently, Omnicom thinks so.

The idea that it is going out on a limb to say that "everyone in the advertising industry will be 'partly a data scientist.'" is frustrating because it should be that way already, and should have been for years.

Obviously, I did most of my ranting on this a few posts back, but seeing it in print just gets my hackles up all over again.  When I got into this business, it was basically because I spent a lot of free time on sabermetrics and baseball, and I wanted to work in a field where data analytics was the job.  I honestly assumed that every SEM account team would have a dedicated stats person, rather than 2-3 analytics people for an entire office, if you are lucky. 

On one hand, I should be glad, because every single advertising person who hasn't completely embraced the statistical analysis side of the industry is making me look better in comparison.  As a search person, you would think that it would be a huge advantage over traditional media and thus cause money and favor to flow to my part of the business. 

The reality is though, while it seems like a no-brainer to some, the very fact that there is an article like this means that the boat is being missed as we speak.  If you saw a newspaper article in 1943 headlined "FDR Concerned that Hitler Might Cause Some Trouble," wouldn't you worry about what the heck FDR had been up to since 1936?

Is it worse to be stating the obvious, or stating the obvious years after it should have been obvious?

On the other hand, apparently we have a bright future to look forward to, with numbers and stuff.