As a parent, I’m well aware of this busy part of the year – it’s back to school time for our kids. Retailers are feeling it too since they’re trying to entice shoppers with their Back to School sales. For this year’s Back to School promotion, retailing giant Walmart is catering to our youngsters with virtual worlds and Miley Cyrus, a busy teen celebrity that’s a singer (well, you be the judge of that) and television actress in a show called Hannah Montana.
Miley is selling gear from her show Hannah Montana including a line of clothes and accessories, backpacks, lunch boxes, etc. To promote the gear, Walmart has created a Hannah Montana virtual world where you can design an avatar, or a 3D representation of you, that can dress up in Hannah Montana clothes. Your avatar can also decorate that room with a Hannah Montana bedspread, posters, etc.
Walmart is driving people to the site via a print ad in their weekly circular — the ad contains a link to the virtual world site. They also created a micro-site where you can get Miley (aka Hannah) to call your child and remind them to go back-to-school shopping at Walmart.
So can this promotion be a success for Walmart?
There are indicators that virtual worlds are more than just a game. For starters, virtual world proponents have argued that these environments mimic real life. This argument is backed up by virtual world gamers reporting that they have real-world emotions or ties when they engage in virtual activities, such as a virtual marriage. And beyond emotions, the exposure to a virtual environment has influenced the purchasing decision of online shoppers. In the case of Land’s End, the integration of a virtual dressing room into their eCommerce engine demonstrated a 13% improvement in the shopping cart totals and a 26% increase in online purchases.
So while Walmart’s social media experiment two years ago never did more than generate buzz for the company, their foray into a virtual world with the backing of a teen celebrity has the makings of a successful marking campaign.
Last week news broke that Adobe is working with Google and Yahoo to allow search engines to access content within Flash files or SWF file formats. In essence, Adobe released a code in the form of a SWF library that allowed these search engines to crawl and index text that’s embedded into the Flash file in almost any language (NOTE: bidirectional languages such as Hebrew and Arabic are currently not accessible).
I’m sure that Flash developers rejoiced at this news since text within Adobe Flash files has been invisible to search engines up until today’s advancement. But the question that comes to mind is whether this news is actually significant (since I’m blogging about it you would think that I feel that it is). In my mind, I can see three things that will come out of this change. These include:
Additional Competitive Pressure on Microsoft
In case you didn’t know, Microsoft and Adobe are at war over the Rich Internet Application development market. In April of 2007, Microsoft released Silverlight, a web browser plugin that allows developers to combine crisp animation and multimedia sound to create a rich experiences, to compete with Adobe Flash. Unfortunately for Microsoft, Flash is found on more than 98% of internet-enabled desktops, making Microsoft’s task of unseating Flash quite a feat. Now it is common knowledge that there’s little love between Microsoft and Yahoo or Google so in my opinion, Adobe is just using their search engine friendly Flash format to further drive a wedge between these companies and solidify their market share.
Search engines take many factors into account in determining the rankings of a website. Since content within Flash files could not be accessible by search engines, interactive marketers could easily sway clients, who begged for Flash-based sites, to use AJAX in the site construction since it provided a search engine friendly way of developing robust text animations. With the announcement by Adobe, there’s been an outcry by some of the best known SEO experts (specifically Bruce Clay) about a resurgence of websites built entirely of Flash because now the text is accessible. While I can see why Bruce may be worried (I thought of the same concern when I read the news), I think that he forgot the basic rule of search engine optimization: highly ranked sites are composed of multiple pages that have unique, non-repetitive content. So for those thinking that they can build a site entirely of Flash, they’ll quickly realize that their Flash site will be composed of a single page and that goes against the rule above. So while I can’t put it past some folks to develop Flash-based websites, the trend to avoid content-rich Flash develop will likely remain at or near current levels.
Ace in the Hole for Google and Yahoo
While the first two deal with short term benefits to the search engine giants, I also believe that Google and Yahoo are viewing the a bigger value (that may not be exploitable today) in being able to search Flash files. The one area that both companies share is in their video sharing sites (Yahoo! Video and Google’s YouTube). Neither companies are able to sufficiently capitalize on the strong growth of online videos since the content within these videos is not readable to search engines. While the current Flash indexing advancement does not allow for Flash videos (which are FLV format) to be accessible by search engines, one could imagine that after this trial run both Google and Yahoo will ask Adobe to make the indexing of FLV a reality. I would also imagine that Google and Yahoo will look to buy some sort of Voice-to-Text technology so that can read their video assets and leverage them in search advertising. If you’ve looked at my blog entries you’ll know that I’ve beaten recently on Google for the lack of new search advertising assets but with this advancement one can see that there’s new value in video.
Google seems to be entering the formidable teenage years and learning that it has talent but it can’t excel at everything — in other words, it can’t rule the world! Yeah, we all know that Google was touted as a prodigy because it revolutionized the search world with its search engine/friendly user interface. And it has been accustomed to constant praise - the latest comes from Harris Poll which exclaimed that Google has towered over Microsoft in reputation. But Google is hitting a wall as it tries to expand beyond search marketing.
Google’s business can still be summed up in two words — online search. It is heavily dependent on search to sustain itself (99% of Google revenue comes from search), whether through Google-owned websites or partners network. The good news is that Google’s business model will remain viable as marketers continue to invest money in advertising alongside search results. However, Google needs an alternate revenue source if it aims to protect its current position, much in the way that Apple is reliant on more than iPod/iTunes to generate revenue (Mac desktops and laptops sales are also responsible for Apple’s continued success). The problem is that Google can’t seem to focus on alternative revenue streams — in checking out future offerings on Google Labs one will find mostly search solutions. In my opinion, this is way too narrow of a focus if Google is to consider the future.
According to a recent Washington Post article, Google actually intends to focus on several areas this year, including mobile. And while mobile has produced services like Mobile Google Maps and GOOG411, a free directory assistance service, these applications have failed to generate significant revenue for Google (currently reported at only 1% of Google’s total revenue). And to add to this pain, news has surfaced yesterday via the WSJ that phones using Android, Google’s new mobile operating system (OS), are not likely to be available by the end of this year as initially promised due to integration issues and slow-going development of customized applications that run on the OS. While this should come as no surprise — The Street hinted of a potential delay earlier this month (Google denied that this would occur) — the delay is one additional setback in Google’s struggle to expand.
So what should Google do?
Again, the people at Google are bright so they must look at where the money is flowing to make a wise bet. And while enterprise applications seems to be a lucrative area (Google can just take on the evil Microsoft Office Productivity Suite), the elongated sales cycle and issues surrounding privacy (Google can now look at your data) along with industry regulations (Sarbox) should, if they haven’t already, make Google reconsider this option.
Another area that makes most sense is mobile. Why? Well, there are several reasons including:
With mobile phone adoption reaching 50% (see article), Google has a potential market of 3.3 billion users worldwide to target with its new OS.
Competition is virtually non-existent. Mobile marketing is still at its early stage so Google can get in on the ground floor. If it needs a catalyst, it can use its cash to buy a company.
Mobile devices are undergoing a major transformation. Users have always complained that these devices are not user friendly due their small screen size and speed. But with the introduction of the touch-screen interface of the newly popular iPhone and investments in mobile data infrastructure/networks, users are finding that the new breed of mobile phones are actually useful replacements for their laptops.
There’s no better place for Google to break into than the mobile world — it is the greatest opportunity that it has in the pipeline. Google just needs to get focused about mobile and show its peers that it can be successful at more than just selling online search. Otherwise, it may face the same future that the has-been Altavista has suffered and that’s rough, especially for a company that has so much talent and potential.
According to a recent Wall Street Journal article about the US economy and spending habits, consumers at every rung of the socio-economic ladder are changing their purchasing behaviors. To better deal with rising food and energy costs, consumers are increasingly turning to the web for ways to save both online and offline. To make matters complex, online retailers are accustomed to seeing high visitor falloff or abandonment. In fact, according to Marketing Sherpa shopping cart abandonment rates are normally pegged at almost 60%. This challenge presents the need to better connect the online and offline world.
In one of my recent blog entries, I discussed the online-offline gap and the methodology used to test new techniques to shorten this gap in order to understand consumer behavior. In this blog entry, I present three techniques that can potentially shorten the gap.
Solution #1: Coupons (Online coupons and mobile coupons)
The recent spike in food and energy cost has driven US shoppers to use coupons more frequently. While coupon usage rates vary, the up tick is expect to continue beyond the short term (see article). To better understand consumers, some retailers have offered coupons in exchange for personal information, including an email address. The benefit of this technique is that once a retailer has the email address, they can use their analytics packages to track visitors from an offer in an HTML email to a website. This allows to retailers to identify and track anonymous users on the website.
The new challenge is that retailers are now focusing on introducing coupons in the mobile space. McDonald’s has recently initiated a mobile coupon campaign in Salt Lake City. The campaign provides McDonald’s with aggregate data for respondents, including their phone number, age, gender and zip code). While these may seem to be valueless, a consumer’s mobile number can actually serve as a unique identifier as consumer demand continues to grow (mobile subscriptions have reached a level that’s equivalent to half of the world population).
Solution #2: Click it and Pickup
Some retailers have implemented a purchasing program that allows consumers to place an order online yet pick it up at a nearby store. This feature entices consumers who normally abandon a site due to high shipping costs to complete the purchase (this is one of the top reasons shopping carts are abandoned). The neat thing about this solution is that visitors who are anonymously browsing the website will log in to complete the purchase and retailers can then track their identity.
To implement this feature, retailers need to tie their inventory management system to the web so that employees in the store can prepare the online order for pickup. To accomplish this, retailers need to establish a solid order management process which is actually harder to do than it sounds. Retailers such as Wal-Mart (specifically Sam’s Club) and Best Buy have rolled out these programs only to get spanked due to reports of incomplete orders or items being improperly packaged/prepared for pickup. Other retailers, such as Circuit City, have perfect the process by also attaching a guarantee. The additional benefit of an in-store pick up program is that it further grows sales.
Solution #3: Customer Satisfaction Surveys
According to a 2007 consumer behaviors survey by Accenture, the quality of service was the leading reason that customers abandoned a provider (this reason actually outweighed price by 20%). In fact, retailers such as Borders are relying on these surveys to better understand how consumer behavior is driving more sales. These surveys are commonly rolled out on sales receipts; retailers encourage customers to complete these surveys by offering a monetary prize (ranging from $500 to $1,000). While these survey engage the user after the purchase is complete (unlike the two solutions above), consumers can be identified when they provide their personal information to win the prize. By combining the consumer’s purchase history with their attitude (aka satisfaction survey) and their online behavior (website analytics), retailers get a more robust profile of consumers that they want to attract and retain.
More Than Three Solutions
The solutions above are only the tip of the iceberg as far ways that retailers can bridge the gap between the online and offline worlds. In addition to the above solutions, retailers that want to bridge the gap should consider investing in a customer relationship management (CRM) solution. A CRM allows the retailer to store the necessary data on consumers (transactions, attitude, personal info), analyze the information and build customer profiles for targeting.
I was checking out Geek Sugar last night and came across an interesting video posting about the iPhone. The point of the post was that the iPhone interface is so simple that anyone can easily figure out how to use it — even a two year old toddler.
In searching YouTube, I came across quite a few videos (see a couple below). The interesting part is that there are no videos of any baby boomers using it. Hmm … I guess that it’s not that interesting to see a 44-year-old using their iPhone. Heheh.
As April came to a close, the month could be summarized by a saying attributed to one of our country’s Founding Fathers, Benjamin Franklin, who said “but in the world nothing can be said to be certain except death and taxes.”
On April 15th, we (those of us who are US citizens) “celebrated” Tax Day – a day when we file our annual tax returns. While I could go off on a rant about how privileged we are to pay to file our taxes electronically in this day and age, I’ll save that for another time.
Secondarily, I ran across an article on how blogging may kill you in the New York Times. The article references the sudden deaths of two well known bloggers and the near death experience of a third blogger (he survived a recent heart attack). The article speaks to the unhealthy lifestyle that these bloggers adopted. However, it does clarify that death by blogging has not reached an epidemic level. (Phew – I was starting to get worried!)
In all seriousness, reading the NYT article does raise an important life lesson: too much of anything is bad for you. While that clearly applies to standard activities such as eating, drinking, etc., it can also apply to software development work - since coding at an extreme pace for extended periods of time will earn you a fatigued, non-productive development team.
You see, software development is often equated to a runner’s sprint, where energy is expanded at the instant that the runner leaves the block (IOW, development project starts) and peaks until the runner crosses the finish line (IOW, the site/application launches). And while runners recognize that once the race is done they need to maintain movement, albeit at a slower pace, organizations/development leaders often struggle with letting the team slow down since there’s more work to be done. Right, there are new projects to complete, clients to serve and a business to run?!
While some developers are known to furiously code for days and nights and then just vanish off the radar, others have found that they can take a break by doing R&D work. Why R&D work? Well, the one common motivator in developers is that they have an insatiable appetite for learning and problem solving. It’s the developer mind-set (and some may say it is in the developer’s DNA). So assigning developers formal R&D time after a project enables them to take a crack at a new technique that they’ve read about but never had time to get it working. This is also a tenent of Agile software development, which we follow at Enguage and find helpful in getting projects done on time. So when developers seek a break, I’m thrilled that they focus on R&D work because it is development.
While this works for us, I’m wondering what else have you tried to give your mind a rest in between projects that still allows the company run like a business?
As digital technologists, we work to identify simple solutions to (sometimes) complex business problems. And one of the most challenging business problems is connecting the web to the offline world.
In our daily job, we follow a straight forward (and rather scientific) process to solve these kinds of problems:
Identify the problem
Propose potential solutions (hopefully there’s more than one!)
Identify ways of measuring the impact of solution
Implement a solution
Track the effect of the solution for a set period of time
Review the effect and refine (as necessary)
As you can see, the process is obviously simple which is great! But there’s the unfortunate hurdle of testing our solution. You see, we need a controlled environment to make sense of the results. And when it comes to the online/offline problem, the environment is NOT controlled and this makes our experiment rather complex.
How is that so?
Let’s take the idea of trying to improve the user experience on eCommerce websites (NOTE: this scenario was actually a topic of conversation at the latest AiMA event). If we wanted to measure the impact of changes to our shopping cart, we would deal with the following scenarios:
The user may need to temporarily leave the site. In this scenario, a user that’s looking to purchase a high definition (HD) television from Best Buy may start at the website but then swing over to an advice site such as Engadget to review the latest offerings before returning to the Best Buy website. In this scenario, we could determine that the user left our site but the Engadget destination would be invisible.
The user may use an offline environment to complete the task. In this scenario, a user may come to BestBuy.com to look up the price of the HD television but, because of security concerns, physically go to the store to complete purchase.
In the two scenarios above, we could measure user paths, entries and exits but we would only get a partial view into the complete picture (IOW, maybe the user is not quite ready to make that purchasing decision). Clearly, we need a way to bridge the online environment with the offline world. But how are we going to accomplish this?
Well, there are several (semi-elegant) ways to connect these two environments but you’ll have to wait to Part II for these solutions.
This past weekend, I attended SoCon08, an unconference on social networking. During one of the breakout sessions, we outlined the various ways that we as consumers or businesses communicate with businesses. The complete list of communication mediums is below for review.
I found it interesting that as the group shouted out suggestions, it took 4 tries for us to mention email, which is an essential means of communication. I consider email essential because I can safely predict that one of the first things that you do each day in both your work and personal life is check your inbox for new email (well, maybe it’s actually the second thing that you do after sipping your coffee).
This exercise also signaled to me a major shift in way we think about email. Obviously, social networking is leading the charge in the way we think about traditional two-way conversations. But more importantly, I think that the internet continues to play a greater part of our everyday lives and social networking is an incredibly efficient means of communicating when we’re on the internet. In other words, we’re online so social networking allows us to have an online conversation whereas using email feels more like an offline conversation during an online experience.
So am I predicting that the death of email and email marketing?
We’re clearly provided with more opportunities these days to jump on the internet. For example, Starbucks allows you to jump online for free as you sip your latté. We’re also hooked on BlackBerry and iPhone devices to stay connected with colleagues and friends. That means that we’re at the crest of the email “wave”. So in my opinion, email is becoming less relevant as a communication means — instead it is becoming a means to set up to-do lists and archiving. However, I still believe that email will continue to serve a purpose in business communication and this means that the art of crafting, delivering and measuring the response from these emails will become even more important.
Reading the financial sections these days will make you aware of the potential economic downturn (example: AT&T seeing softness in consumer spending). So if you’re contemplating whether you should establish (or grow) an online marketing budget, please allow me to suggest that your monies should be hoarded until the economic “haze” clears because nothing is better than watching your competitors take market share. In times like these, it is clearly important to be more focused and strategic with your online marketing efforts.
If you sell your products offline, it is time to think about:
Setting up a shopping cart to allow buyers to learn more and directly order your products.
Accepting payments online to speed up the collection process and improve your cash flow.
Using a Customer Relationship Management (CRM) system to collect leads or other customer communication and efficiently route them within the organization.
Because eCommerce is a highly matured area on the web, there are actually several affordable/inexpensive solutions that can be easily implemented, and these are great especially if you’re just starting out. But as your business grows, your needs will likely change so you’ll want to give slight consideration to solutions that have more features, can be tailored to your organization or can scale to support more employees (aka users). These solutions will likely require more effort to implement.
If you’re already selling your products online, it is time to add more sophistication to your existing system(s). So, it is time to think about:
Integrating a Product Review System into your Shopping Cart to enable buyers to better understand the quality of the product.
Launching an targeted email program that delivers personalized email messages based on a user’s shopping habits, interests or even language preferences (FYI: the next wave of consumers in the US speak/read Spanish).
Promoting your product offerings within a local search portal or even a mapping service (like Google Maps) to drive more local awareness.
In essence, now is time to get going but not without a strategy. It is simple to go from point A to point B, but only with a strategy can you move forward in a direct line.
It’s been almost a month since Raghu Kakarala and I discussed widgets together at a Lunch seminar, and there’s been enough interesting news since then that it warranted an update on this topic. The take-away points were: widgets are here to stay (in other words: not a fad), they can be either extraordinarily interactive or simple (so build one if you haven’t yet). and widget distribution is key (because it will extend the footprint of your website’s reach).
Now that you’re all caught up, here’s your widget update for December:
Widget vs. Gadget Debate
We found it interesting that widgets go by various names. For instance, Yahoo and Apple use the term ‘widgets’ whereas Google’s iGoogle and Microsoft’s Live Spaces use the term ‘gadgets.’ According to Widgets Lab, the distinction between widgets and gadgets is that gadgets live in a specialized web environment (also referred to as an ecosystem). Unfortunately, Google has recently made their gadgets interchangeable between the web and the desktop sidebar so this naming convention will likely go by the way side.
Monetization of Widgets Debate
As widgets have become increasingly popular, technology pundits have challenged the widget community to show them that widgets have real monetary value. News broke last week that GoodWidgets, a widget company that offers a slideshow widget, is up for sale for $10k. While this is “small potatoes” in comparison to other widget makers like Slide (Slide is Pitching For A $200 Million Valuation. Or Not.), it demonstrates that widgets are evolving into a “product” that can be sold. This comes on the heels of news that Clearspring has rolled out an ad network for widgets which lets users monetize their widget traffic. So while we’ve still got a long way to go, there’s at least monetization momentum.
e-Commerce Widgets Become More Seamless
In our presentation, we talked about eBay’s listings widget that could feature items from eBay stores. The idea was that famous listings can garner more attention. In other words, now your blog post on the recent Britney Spears Birthday Bash could include the listing for the half-eaten chocolate cake from the party. Well, it seems that PayPal is taking that same concept a step further by offering a PayPal storefront widget with a shopping cart. So now blog owners can create a store, add merchandise that’s relevant to their posting, and post the store to their blog. The neat thing about this concept is that only the financial portion of the transaction has to be completed on the PayPal site.
Again, it is another step for widgets becoming more useful and a part of the mainstream web.
At Spunlogic, we have a lot of great experience and unique ideas to share. From work with clients to new approaches and trends, in this award winning blog you'll find Spunlogic experts sharing their opinions and ideas on all aspects of interactive marketing.
As April came to a close, the month could be summarized by a saying attributed to one of our country’s Founding Fathers, Benjamin Franklin, who said “but in the world nothing can be said to be certain except death and taxes.”
