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Understanding Search Behavior To Improve Find-ability:
A Case Study
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Being found on the Internet is important for most businesses and critical for many. Search Engine Optimization (SEO) is a methodology used to help specific websites be found. However it is non-trivial to truly understand what to optimize for in terms of how people search.
Understanding the search behavior of people looking for your goods or services is mandatory for effective search engine optimization. This month we provide a case study to show how this works.
Read the case study
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Customer Manufacturing Update
September 2013
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Trade Show Marketing 101
We don't get to a lot of trade shows anymore (Maybe good for us), and Mitch had the opportunity to attend the National Association of Broadcasters (NAB) Show in Las Vegas earlier this year. This is a very large show. So, as you would expect, the vast majority of exhibitors are unknown or lightly known companies.
It continues to amaze us what people don't do with the exhibit booths to attract visitors. Almost none of the exhibitors made it easy (or even possible in too many cases) for you to know what they offered that you might be interested in while walking by their booth. They spent a fortune on a booth and a huge sign with their name
on it. Somebody must have convinced them that name recognition was key. Silly.
At a trade show the key is to attract visitors to your booth. If you are Adobe you can simply put your name on your booth and you will have hundreds of people in your booth at all times (and they did). However, if you are not well-known, putting your name up on a big sign will not help you get known because what reason does someone have to want to know more about your company?
Mitch watched thousands of people walk by booth after booth, glance, be confused, and move on. Those few booths that allowed you to know what they did that might interest you, had traffic, as did the well-known companies.
We would have thought by this time people would know this, but we suspect trade show experts from the 1950s probably said the same thing in the 1990s. The good news is you can still stand out in the crowd even at a large show like NAB if you focus on the visitor and not on yourself.
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Is Your Price Too Low?
Pricing strategies are a challenge ... especially in today's hyper-competitive and transparent marketplace. Using price to induce trial is a subset of an overall pricing strategy. Many people believe that you can make an "offer they can't refuse" to induce trial. This is, of course, true and depends on factors such as barrier to change, risk of change, ease of trial, etc  .
Our experience and research over many years suggests that trial can be induced in a majority of situations by offering a discount of 20%-25% off the price the customer is currently paying. This seems to be the price point which creates an "offer they can't refuse" to at least try. In truth, if a competitor of yours is offering such a price point, you can be reasonably sure many of your customers are at least trying. Defection may or may not result depending on the results of the trial, ongoing pricing, barrier to change, etc.
Some people believe that an even lower trial price might be even better. In our experience this is not usually true. That is, if you offer 50% off (or more) you will likely get fewer trials, not more. Why? It appears people are concerned that at that price point the offering may be significantly inferior to what they are currently using. A 25% discount seems credible, a 50% discount seems incredible.
And there are exceptions to every rule. An example is the Dollar Shave Club. A YouTube and market sensation founded by "Mike." He offers unbelievable savings on razor blades. While even his namesake $1/month blade program costs more than that when you add shipping, and he has two up-sell programs, his pricing is "unbelievable." How can he sell useful product of this category for so little money? Is the product just "crap?" Not according to reviewers. And it does not matter anyway. Why? Because the trial investment is so little that you can self-evaluate with little risk. If the product works for you, you win. If not, you are out a few bucks. And his ad is hysterical. As CNET reviewer Rick Broida, asked, "why can't all ads be this good." |
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An Advertising Age article apparently raised a ruckus because it had the audacity to state that a vast majority of marketers set their budgets based on historical spending and gut instinct and not ROI. Is this really shocking? Not to us. While there is more pressure on Marketing to show accountability, it can still skate all too often. 
Arguments abound about what ROI measure to use. The primary focus is currently on "brand value." Problem is there are at least four different measures of brand valuation, and they disagree with each other significantly. This is a bogus focus anyway. Unless and until it is an accepted metric.
What ROI measure should you use? Simple, what business outcome(s) is/are your company trying to produce? How can you support those outcomes by investing in Marketing in such a way as to produce a positive return? If brand value increase is a business outcome for your company, then agree on how to measure it.
The truth as to why Marketing is avoiding an ROI focus (aside from talk) is probably most simply summed up by the quote attributed to many Marketers involved in the study, who said, "If my boss is happy, that works for me."
In too many companies all that matters is that your boss is happy.
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CEOs, Actors, Sports Stars & Pay for Performance
CEO pay in the U.S. is out of control, by some people's definition. It far exceeds the 10x factor that some practitioners claim is reasonable for CEOs to make vs the lowest paid employee in the company. CEOs and management in government functions have seen pay increases that defy logic in many cases. The average school board "chief" in California makes more than the governor of the State. Many people feel that CEO pay has gone berserk because of the superstar factor.
If sports stars and celebrities can make millions of dollars per picture or per season, why should a CEO not make the same? If the star of the movie is not constrained to making 10x what the "best boy" makes, why should a CEO be so constrained? One can argue that if the movie or the team fails, the super star takes the hit. Not so. Many a team has hired a supposed superstar, given them a multi-year contract and found they could not produce. Many a box office draw actor or actress has been part of a movie that bombed. And the CEO of Netflix and his team were paid very well last year, despite their efforts to mess up the company.
Boards of Directors, team owners and movie industry executives are often caught in the same dilemma. How can they "assure" results? Hire a superstar is the American solution. And we can see examples of that. Basketball tends to work that way, unless you are the LA Lakers and you can't get your superstars to agree to play together. Movies can work that way, and the Yankees can't decide how many superstars they need to win. Billy Beane found that he could field a great team without so-called superstars. Problem was there is a lower limit to the talent you need to win.
Pay for performance is a tough problem for managers, comp committees and owners. Once people have performed elsewhere they expect you to pay for their proven potential. But does a single CEO really make that much difference? Ask HP. Is a CEO worth as much as Leonardo DiCaprio or Angelina Jolie? Depends who you ask.
But if we are going to pay superstar talent a lot of money, then superstar (even if only in their own minds) CEOs will expect the same.
That being said, we are reminded of two process truths:
- Person dependent processes generally are not sustainable, or a good idea
- People are not usually the constraint to better results, the process they work in is the constraint, because
Every process is perfectly constructed to produce the results it's producing.
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Free Reading Guide
If you have a copy of our book Value Acceleration, you can download a free reading guide to help you and your team get the most from the book. (And btw, the book was updated in 2012 and is also available in a Kindle edition.)
We appreciate your feedback to help improve these Updates. If there are others you feel would benefit from this issue, use the Forward email link just below on the left. Sincerely, |
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