Social Word of Mouth Marketing


As social networking explodes on the scene I’m wondering about legitimate vs questionable marketing tactics that involve one’s social network.   Here at the JoeDuck blog I’ve avoided advertising (though I have taken a few liberties with posts that help rank other sites or promote friends, etc).

At my commercial sites I’m more aggressive with advertising and find it’s very hard to decide what levels of advertising are best suited to all the factors that come into play such as generating revenue, being honest,  keeping Google happy, etc.    Although I increasingly buy into the idea that “user friendliness” is a good guideline I don’t think it’s the best one from a revenue standpoint.   Even Google, which I think built a grand online empire partly on the basis of limiting the advertisements around search,  has very gradually increased the aggressiveness of their advertising at some “user centric” expense such as the ads that appear on top of the organic listings.    Although Google insists they are clear about identifying advertising the proof is in the perception and many people still do not understand the difference between clicks when Google is getting paid and when they are not.

I don’t object to Google’s current standards which I think are more than reasonable, though it’s always annoying to hear them pretend (or think delusionally) that their only consideration is optimizing the *user experience* without regard to revenues.   That would not be good business and arguably would deprive them of revenue they can use to provide the raft of great free services we enjoy from Google like blogger, search, mail, maps, and more.

But the real point here is to find a balance between social networking and marketing.    I certainly don’t want to pester people with advertising after they have nicely  come to Twitter or the blog to “interact” about politics, technology, or travel.     But are there appropriate advertisements that do not offend people?

More importantly, how should one handle paid or unpaid endorsements of businesses?     Over at Technology-Report we are now sponsored by Ipswitch Imail  Server, an Enterprise email system.   What’s really intriguing me is at what point one crosses the line between using and abusing the relationship you have with people to promote your business “allies”.  The link I just provided helps them.  I think that’s fine but some might say it’s using the blog inappropriately. Adding “nofollow” to the link would tell Google not to consider the link as an endorsement of the company but I’m happy to endorse them – they are smart enough to sponsor our Tech blog so they must be good, right?

I think the best working rule here at the blog is transparency, where people know the money relationships between you and those you talk about.   For stocks I use a disclosure blip, for companies an explanation of the relationship.  However for websites I’m not as transparent and I think I need to reconsider that and provide more disclosure than I have in the past to help combat the growing “economy of lies” that is far more pervasive than we tend to think.

From bank lending and “promotional offers” with fine print that traps even savvy borrowers to blatant phone credit card ripoffs that prey on the gullible to the Madoff stock scandal to bogus “get rich quick” training programs, the “economy of lies” is everywhere.    Online, it becomes even more difficult to check credentials and make sure an offer is real.

Then there are the “somewhat misleading special offers” which I think may be impossible or even undesirable to combat.    For example I’m shopping for Las Vegas hotels, flights, and show tickets and notice there are often dozens of offers for the same rooms, each with different rates.  Although the conditions vary a bit, basically these are marketing experiments designed to optimize revenues and collect information for the future.   Not perfectly “honest”, but not scams.   I’ll talk about this more at my Las Vegas Travel blog.   Hey, see, there’s a tiny SEO helpful pitch for my own site – is that legitimate?

An interesting idea – though bureaucracy alerts are kind of sounding for me now – might be to create some sort of volunteer disclosure standard that was monitored by a third party.    For example no site could endorse more than one product of the same kind.    Sites that abided by those rules would be listed and allowed to slap up a logo, those that did not would not.   Policing this probably could be done via an online “complaint” system, and the neat part would be to help screen out the huge number of junky sales sites that have no content of value and offer dubious offers.

Still, that option does not really seem workable on a grand scale because too few would participate.

Who is clicking at your online business door?


Back in July I missed this great post by Dave Morgan at AOL but thanks to Danah Boyd’s post it has surfaced again.    The findings are very surprising and very relevant to anybody running click or online advertising campaigns.   Dave summarizes the findings very concisely as follows:

We learned that most people do not click on ads, and those that do are by no means representative of Web users at large.

Ninety-nine percent of Web users do not click on ads on a monthly basis. Of the 1% that do, most only click once a month. Less than two tenths of one percent click more often. That tiny percentage makes up the vast majority of banner ad clicks.

Who are these “heavy clickers”? They are predominantly female, indexing at a rate almost double the male population. They are older. They are predominantly Midwesterners, with some concentrations in Mid-Atlantic States and in New England. What kinds of content do they like to view when they are on the Web? Not surprisingly, they look at sweepstakes far more than any other kind of content. Yes, these are the same people that tend to open direct mail and love to talk to telemarketers.

What does all of this mean? It means that while clickers may be valuable audiences, they are by no means representative of the Web at large

Indeed, this means that many online marketing campaigns may need to dig a lot deeper to obtain a positive ROI, and for some campaigns positive ROI is not attainable.    If, for example, irrelevant clickers (not to be confused with click abuse) mean you’ll have to spend a few dollars to reach a single prospect, and your margin on your product is only a few dollars, you may be fighting a losing PPC battle for online hearts, minds, and pocketbooks.    On the other hand if your target audience is, say, midwestern stay at home soccer moms, you may want to up your PPC spend dramatically because your nickel or dime per click could be worth many times that in prospective sales.

Obviously Dave’s post is only the beginning of the big story which has yet to be written,  and I’m not clear how representative this sample was of all PPC activity (I think it was broadly representative though – they looked at billions of data items).  However this helps me understand why some of my PPC experiments have failed to yield much of a return.     A good travel experiment given these findings would be to look at midwestern travel patterns and try to advertise popular packages to Mexico  or other commonly travelled points south in the winter.   Since women are the main travel planners this match could work well to increase the normally very low conversion I have seen on travel related PPC spends.

Facebook and Politics do mix.


Matt Ingram’s asking about Facebook and politics, noting that CNET thinks they don’t mix all that well. 

They do mix.  Superficiality, negativity, whimsy, and personalities are all key components of social networks and of the American political experience.    The best online strategies may actually win these races, especially in the wide open Republican nomination.   I predict Romney will win that in some part thanks to his excellent family blogging efforts.   Online campaign marketing will certainly contribute to the win in ways disproportionate to their cost and to other media efforts.

 More politics here at President Picker

Kindle – market mini-analysis


OK, I just got it. The Kindle does have a market. Bezos is correct of course that the reason books persist in the digital world is their ergonomic appeal. With the Kindle he’s working to maintain that book advantage while adding the digital improvements modern technology can offer – that is a library of Alexandria at your fingertips.

Yet the obvious challenge here is what I’ve noted before – laptop users won’t switch to a device that offers ergonomic improvements but less functionality and more cost, and non-tech people won’t adopt tech approaches this quickly. So, who does that leave in the Kindle market? Jeff Bezos is one person, and I think he’ll buy one. I’d probably buy one if I had money to burn on a redundant but somewhat better device for my reading.

So the Kindle market will be heavy duty book readers who *also* like technology *and* have a fairly high threshold of disposable income. This is not a trivial number of people, though it’s probably only in the neighborhood of about 1-2% of the US population. Let’s assume that the number of people who are heavy readers and would like a Kindle and can afford a Kindle are 2% of the US population. That’s a potential market of 6 million people, which does not seem all that problematic. If they can penetrate 10% of this market and sell 600,000 devices along with the many books people will buy at 9.99 maybe it won’t lose money, and perhaps even could evolve into a device with broader appeal.

But I wouldn’t bet on this.