Diamond Website Conversion » Business Philosophy

Thinking About Internet Marketing Tools

Carl — Tue, 09 Jun 2009 17:26:47 +0000

I can think of no other business with such a dizzying array of tools available, than those available to the owner of an ecommerce business. The good news however, is also the bad news.

Here are just a few of those tools, and many of these have multiple sub-choices: search engine marketing (including search engine optimization and paid search), website conversion, merchandising (bulk SKU loading, up selling, cross selling), analytics, email campaigns, loyalty programs, online enthusiast forums, personalization and interactivity, outlet stores, closeouts and O.D.A. D. (one deal a day), catalogs, magalogs (catalogs with content), affiliate marketing, linking, stores on eBay, Amazon, MSN and Yahoo!, and private labeling.

No one has unlimited financial and management resources. Further no one is an expert in every option. Each option has its own baggage in terms of commitment vs. potential payoff. So how do you prioritize and choose one? How big a commitment do you make? How do you select a vendor? These are all good questions, without easy answers.

First, all of these options are tactics, not strategies. We are big believers in establishing your strategy before you implement your tactics. Once the right strategy is in place, the available resources will be obvious and will also point to the low hanging fruit.

We’ll Show you the Money

Carl — Tue, 09 Jun 2009 17:26:28 +0000

Here’s the scene: You’ve been out to dinner and you’re walking to your car. You look down and there’s a $20 bill on the sidewalk. Found Money…. Wow it’s exciting!

Much of the time, particularly in ecommerce companies, there are opportunities for Found Money. Money that is right there under your nose.

Imagine a modest increase in conversion from 1% to 1.3% It may not sound like much, but it adds 30% to your top line and most of that new margin will drop right down to your bottom line. Found Money.

Have you heard of Diapers.com? They changed their gross volume in one year from $11 million to $36 million, through a clever referral scheme. Found Money.

ATG Stores divided their SKUs among fifty sites instead of five, making each one more targeted and dramatically increasing click-through rates and conversion. Found Money.

Can you source some product directly from manufacturers, cutting out the distributor and expanding your margins? Found Money.

Is there a website redesign or web design usability test that can direct you to found money?

The opportunities for Found Money are everywhere.

Why Strategy?

Carl — Tue, 09 Jun 2009 16:19:43 +0000

What is the purpose of your website? Without addressing what we believe is the elephant in the room, namely your business’ core strategy, you may find yourself spending money and time on tactics that may or may not work.

The dictionary defines strategy as: “A plan, method, or series of maneuvers or stratagems for obtaining a specific goal or result.” In military usage a distinction is made between strategy and tactics. How the battle is fought is a matter of tactics; whether it should be fought at all is a matter of strategy.

Optimizing your conversion is just a tactic looking for a strategy. We cannot do a really effective job of helping you improve the conversion and usability of your website until we have determined a clear value proposition for your site (why should the visitor deal with you and not your competitor). Once your value proposition is established, the next steps become obvious.

An example might help clarify the strategy/tactics difference:

I recently bought a Sennheiser telephone headset from a site (which will remain unnamed). The headset arrived in good shape, but there was no way to connect it to my phone.

To use the headset, you must also purchase a headset connection device which connects the headset to your office phone, mobile phone or computer. Sennheiser makes several connection devices depending on the type of connection needed: 2.5 mm phone plug, 3.5 mm phone plug, telephone jack or computer connection.

I went back to the website to see if I’d just missed a something when I ordered the headset. Nope, there were some vague references to a headset connection device, but nothing that caught my attention, or that said “Don’t buy this product without also purchasing a connection device.”

I called customer service for the website, got the correct connection device, and they mailed it out for free (so unhappy customer becomes satisfied customer).

What will this website do in response to my complaint. Tactics to the rescue. They will probably change the product description to alert customers that they’ll need to purchase a connection device, in addition to the headset, and then provide a way for the customer to determine the correct connection device for their situation.

These tactics will solve the problem for this product, but what about future products? A change of strategy is needed. The new strategy could be: before we introduce a new product or a new line of products to our website, the staff tries them out.

The new strategy provides several benefits:

Your product descriptions will be more accurate
You can personalize product descriptions
You can post staff reviews of new products
You’ll be able to advise customers on any accessories required to make the product perform as expected
Your checkout process can be configured to alert the customer to any unusual/unexpected product details prior to ordering

If you have no strategy, or a flawed strategy, you are depending on luck (roulette) to get you where you are going. Getting to the heart of your company’s strategy allows us to focus on your true goals. Now the time, effort and money you put into conversion and usability will really work for you and your customers.

Use Strategic Partnerships to Be More Competitive

Carl — Tue, 09 Jun 2009 16:08:07 +0000

No one can be expert at everything. This is particularly true in ecommerce, where no one can even know all the moving parts, let alone be proficient at everything. This brings us to partners.

Most small and mid-sized businesses can’t afford to hire all the skill sets and competencies they need in-house. Yet, to remain competitive on the web, you must have access to these skills. This leaves you partnering-up at a lot of different levels: vendor support teams, independent contractors, part-time help and consultants.

We spend many hours every week staying up-to-date in the evolution of best practices affecting strategy, marketing and website conversion. We never stop interviewing and vetting prospective vendors for our clients. The net result of this process is a list of trusted resources that we can recommend to our clients.

Once your strategy is set, the name of the game is a never-ending series of small enhancements. A relentless focus on small improvements is what distinguishes winners from their competitors. Improve and increase, improve and increase. There is no silver bullet. The silver bullet, as it were, is the compounding of all the small changes over time.

Competition is brutal and getting stronger. The day you stop investing in enhancements, is the day you start ceding market share and customer loyalty to competitors. It is the day you start going out of business.

Our Philosophical Toolkit

Carl — Tue, 09 Jun 2009 16:06:24 +0000

Take Responsibility.

Some folks walk around with an invisible three-legged stool attached to the seat of their pants. When something goes seriously wrong, they immediately sit down. The first leg is to refuse to take responsibility under all circumstances. Second, find someone to blame. Third, feel sorry for yourself. Not to much is going to go wrong while seated, but it’s hard to go forward from that position. If you really screwed up, and feel terrible, try this mantra: ” I take full responsibility for this situation. I did the best I could, at that time and under those circumstances. I forgive myself.”

Meet people half way.

Do not have relationships with people who do not meet you half way. What is half way? Justice Potter Stewart of the Supreme Court, when speaking of pornography, said it was hard to define, but “I know it when I see it.” We have all been in those relationships, business and personal where we or our services are not valued. If you move away from those relationships (business or personal) where you are not valued, others, better ones, will take their place. People fear a vacuum, but to paraphrase Fritz Perls, flowers will bloom there.

There is no such thing as a free ride.

Call it karma. Call it what goes around comes around. Whatever you call it, you generally want to avoid getting too good a deal in your relations/negotiations with other people. Why do seemingly successful negotiations gradually fall apart? The problem is, most people see negotiations as one dimensional. They figure out what they want, go for it and if they get it, declare victory and go home. Unfortunately, for them, the job is only half done. A truly successful negotiation means both sides get what they want. It is incumbent upon you, once you achieve your goal, to persistently, even aggressively, determine what the other side wants, that you can afford to give. Why not? You have what you want, you can afford to be generous. It is an insurance policy that assures that what you think is a successful negotiation, is indeed successful.

I knew an employer who, selectively, when he made a good hire, and after all negotiations were finished, called the applicant the next day and said, ” I have been thinking it over, I’m very glad you are joining us, and I have decided to bring you in at a higher salary.” Speaks for itself.

Never, ever, bet the company.

This seems to be one of those oddities of human nature: the self-inflicted wound. It is often fatal and frequently preventable. Most of these appear to be attributable to two causes: poor management and personal demons. Poor management can be mitigated by sticking to basics: never give up something that is working for something new and untested, especially technology. When Coach introduced a new $900 bag, they didn’t do it at the expense of their $200-250 bags. They expanded their $200-250 bag offerings. Toyota never adopts technology that hasn’t been proven. Develop a process for calculating the worst case possibility. Independent advisors who will tell you what you need to hear, not what you want to hear. Carefully calculate the dilution of management time away from the core effort. Thorough vetting of new vendors. Three competing bids. Checking references.

Personal demons are a trickier proposition. What drives someone to take inappropriate risk? The answer probably lies in the realm of psychotherapy, clearly beyond our bailiwick. You might consider this, though, if you are in the grip of an urge to swing for the fences: most people who have brought a business from conception to viability have paid a tremendous price, physically, psychologically, emotionally and financial. You have something akin to a moral obligation to consider the welfare of your family, employees, customers and vendors, before you risk losing it all. Think carefully about the impact on each of them, before succumbing to what could amount to a cheap thrill.

Get your ego or get what you want.

Everyone has a favorite story of the blowhard at the airline gate who winds up not boarding, or sitting the middle seat while others board and get upgraded. The failure here is the passenger thinking that they have all the power, when in reality the ticket agent has the real power in this equation. I knew a service advisor who wrote up repair orders in the driveway of a Mercedes-Benz dealer. He took special pleasure in occasionally sending selected (difficult/demanding) customers “to the moon.” After I personally witnessed one of these he told me, “That guy owns ten McDonald’s.”

In lots of sales offices, the sales secretary has the power position. She takes messages from clients and prospects, prepares proposals, processes orders and prepares commission vouchers. It never fails: some of the reps are patient and courteous and sometimes pay for her lunch, others stamp their feet, make a ruckus and are generally disagreeable. Guess who gets the best service and the occasional leads that come her way?

My dad always used to say, “Be careful of what you want, you may get it.” If what you want is your ego, be careful, you just might get it.