Bigger, Louder, & More Obnoxious Ad Units

Some larger online publishers are facing declining display ads with a bold strategy: bigger, louder, and more obnoxious ad units. AdWeek reports:

  • The fixed panel, a 336-by-860-pixel banner that is wider than the standard skyscraper and follows users as they scroll down the page.
  • The XXL box, a 468-by-648-pixel unit that can expand with video.
  • The pushdown, a 970-by-418-pixel placement that takes up over half of the page before rolling up.

We recently added a slideup and a popup to the site here, but you should be able to click them once and not see them again (at least until you clear cookies), and at least they are marketing our own site.

But the idea of making larger and more obnoxious ad units some sort of standard for cross-selling seems to be against what is working. Most of Google's ad revenues come from tiny text ads that are relevant to user demand. One of the best ways to have relevant ads is to create what users want and sell it. If they are going to spend that many pixels on the ads, rather than making bigger ad units the publishers should use the content area to sell and add premium services to their sites and start selling content.

Phorm/Google Behavioral Ad Targeting - Based on Your Browsing Data

Phorm, a UK company that partnered with BT to run secret trials to target ads based on usage data, was roasted by the media with article titles like Phorm’s All-Seeing Parasite Cookie.

Google, which has long stayed away from behavioral targeting due to privacy (and negative publicity) concerns, announced they are jumping into the behavioral ad targeting market:

Google will use data it collects about what Web sites users visit and what it knows about the content of those sites to sort its massive audience of users into groups such as hockey fans or travel enthusiasts. The data won't be drawn from users' search queries, but from text files known as cookies that Google installs on the Web browsers of users who visit pages where it serves ads.

DoubleClick, AdSense, Google Toolbar, Gmail, Youtube, Blogger, Google Groups, Google Checkout, Google Chrome, Google Analytics...there are lots of ways to track you, even if you do not want to be tracked. Google will allow users to opt out of such targeting, with yet another cookie, but if you clear cookies then you are back in the matrix again.

And while Google claims they are not using search queries in their current behavioral targing, Danny Sullivan wrote:

Google confirmed in a session I moderated at the Omniture Summit last month that they have tested behaviorial targeted ads using past search history data. Again, that doesn’t seem to be part of this release, but it could come in the future.

As discovered during early Google research titled The Anatomy of a Large-Scale Hypertextual Web Search Engine:

we expect that advertising funded search engines will be inherently biased towards the advertisers and away from the needs of the consumers.

Indeed. Tim Berners-Lee, creator of the world wide web, spoke out against behavioral targeting:

"People use the web in a crisis, when wondering whether they have a sexually transmitted disease, or cancer, when wondering if they are homosexual and whether to talk about it … to discuss political views."
...
"The power of this information is so great that the commercial incentive for companies or individuals to misuse it will be huge," he said. "It is absolutely essential to have absolute clarity that it is illegal."

If Google continues down this path unquestioned, then in due time you may not be able to get health insurance because of a web page you viewed or a keyword you trusted Google enough to search for. Better luck next life!

Soft-Bundling: The Value of Perceived Authenticity & Transparency

Brian Clark notes the rise of the word authenticity in the field of marketing. Clay Shirky wrote that transparency is the new marketing. For individuals these are true, because if some people grow to like you some will grow to hate you, and it can wear you down to try to fight off a bad reputation in a sound byte culture. Just ask Jim Cramer about Bear Stearns

But for larger companies perceived transparency & authenticity is far more important than actual having either.

Google's Free Ride

Because Google provides a valuable service for free and is easy for end users to like they can get away with a lot of stuff that a company like Microsoft could never do.

Paid Posts

Google's search engineers have waged a war on paid blog posts. Google Japan knew they were operating outside of the guidelines when they were buying links in blogs. Google attempted to sweep the story under the rug until after they knew it was going to get enough exposure that they couldn't effectively do it, and then it became a case study for their anti-spam team, when they applied a fake penalty against their site.

Click Fraud

One of my AdWords content campaigns had an image ad unit that was pulling a 2% clickthrough rate and getting over 600 clicks a day, for a cost near $100 a day. I have already blocked a lot of the nasty no-value exclusion categories but I spent the last couple days blocking some more, and the above $100 a day spend was reduced to $5.42 once the fraud and skimming was removed.

I know Google says they offer some refunds for fraudulent clicks, but some of the stuff in their networks is so fraudulent that the only way to police it is to remove it completely. Over the past year some of these fraudulent sites have got hundreds and thousands of dollars from me for setting up nothing more than a thinly veiled click fraud botnet - feels more like Yahoo! than Google when I looked at the traffic, but at least I was able to filter it out after they stole some of my money.

Such fraud damages the entire ad ecosystem - advertisers have their budgets depleted due to click fraud, legitimate publishers are paid less because content is viewed to have less value when so much of the advertiser ad budgets are blown on click fraud, and web users see lower quality ads because some of the best ads had their budgets blown on click fraud.

Support Piracy

BearShare is an official Google search partner. At one point years ago I saw ads for a company supporting illegal downloads of their very own copyright work. Now Google has moved on toward promoting keywords with Torrent in them on brand searches.

If the domain name has leech, domain, or torrent in it then you know most advertisers do not want to subsidize it. Google needs to make a category for downloads and warez sites. The only reason they have not is because doing so would make people realize how bad some of the content network is.

Reverse Billing Fraud

Many services are marketed as being free or complimentary or just pay shipping, and then in 6 point text in the footer there is a disclaimer about how your credit card will be charged $20 3 times a month until you notice it. These typically promote broad market fads & services like acai berry diets, ringtones, credit checks, and free government grants. A group of con men / scam artists jump from one opportunity to the next to scam consumers using the Google ad network.

The government grants scam made enough of a footprint that the FTC is getting involved. Google claims that they are sorting out the issue:

"Our AdWords Content Policy does not permit ads for sites that make false claims, and we investigate and remove any ads that violate our policies," said Google in a statement e-mailed to ClickZ News. "We have discussed these issues with the Federal Trade Commission and reaffirmed our commitment to protecting users from scam ads."

but a Google search for government grants shows the ads still are running.

Microsoft Gets the Shaft

The Opera CEO believes that Microsoft giving users the option to turn IE 8 off is not enough, and the EU is trying to rip Microsoft apart day by day. Even if Microsoft is able to buy Yahoo! Search it will not be enough to compete. Why? Even when you use Microsoft's products they recommend Google's stuff over their own.

Google's Momentum

While Microsoft is busy fighting off competitors in many markets, Google keeps gaining market-share and market leverage in new verticals through soft-bundling.

One of my clients that did not use Google Checkout simply had to stop advertising on AdWords until Checkout was enabled, because without it the usually slim profit margins on AdWords turned negative. It turns out that pricing ads based on "quality" with a discount for a higher clickthrough rates allows the highest quality advertiser to rank #1, so long as they are using Google Checkout to give Google more market data and another chance at monetization. ;)

The Google Chrome browser is recommended on Youtube, advertised all over the AdSense network, and pushed via bundling partnerships with the likes of the Real player and Divx. Its release forced Microsoft to make some of their security products free, and will keep costing both companies money, with the hope that it costs Microsoft more than it costs Google.

Google is still crying to the EU that Microsoft's business behaviors are uncompetitive. Once you get branded it is hard to get un-branded. In spite of the recent slowdown in search volume Google still has a lot of market momentum behind them. You will know Google is in trouble when the market stops giving them leeway and treats them more like Microsoft.

How You Can Apply This to Your Business Today

1.) Always push to own a market default position and once you achieve that position keep investing in maintaining it, while reminding the market that your growth was organic due to your superior quality.

2.) Even if the business model is not there you can always create one/bolt one on if you get enough exposure. In the age of soft bundling it is no accident that we offer some of the best free distributed SEO tools like the SEO Toolbar and SEO 4 Firefox, with intent of helping push this site into a default market status.

3.) What sorts of distributed marketing can your site benefit from?

  • real time data
  • unique data interfaces
  • widgets
  • tools
  • open source software
  • mashups
  • etc.

Each day more options will reveal themselves.

The Point of Increasing Returns

when I got on the web one of the first mistakes I made was trying to go after the cheap traffic on the second and third tier networks. I arbitraged one of them and was pulling a 300% ROI selling them back their own traffic - but the wankers never paid me a cent.

It can be appealing to think of how to do things cheaper...and sure in the short term it might make sense to do something half-way to get it up and going and then to keep making incremental improvements. But people like Philip M. Parker have created automated technologies to write books. Cheaper is a hard way to compete in the content business.

If you are just fishing for nickels and do not intend to take the market head on then any of the following can take you out:

  • algorithm updates
  • remote quality rater or spam report
  • self-sabotage through doing something a little too clever
  • more established niche competitors accidentally or intentionally copying you
  • large general competitors accidentally or intentionally copying you

With search many early successes will be longtail keywords, but eventually you want to go after the biggest and best that you can achieve. Why? Once you have status you enjoy cumulative advantage in everything else you do. Things that are somewhat remarkable become quite remarkable just because who is doing them.

It can take a long time to work yourself to the top of a hierarchy. Most people who succeed ignore the hierarchy and look for a way to dominate a related niche

Ideally, a new player wants to come in with a fresh approach that doesn’t necessarily threaten the existing hierarchy. This allows you to develop an audience by sharing with existing players, not necessarily competing with them.

What you’re looking to do is intensify the niche by doing something more, or differently (or maybe even better) than the existing players. You do this by first evaluating and understanding where the niche is currently, and position your content in a way that pushes the envelope.

Unless you are really well established there is a lot of uncertainty in what you do online. Each additional investment can seem like you are getting closer to the point of diminishing returns, wasting your time. But then surprisingly one day things go way better than expected, and things are received much better than expected. You get a dopamine rush and the sun shines a bit brighter. Network effects kick in and you have reached the point of increasing returns - where each $ invested returns 10s or 100s of dollars back. I think Seth refers to this concept as The Dip - its what separates market winners from people who wasted their time.

But you usually have to lose $50,000 to $100,000 in sweat equity to get to that point, at least on your first successful project. The good news is that once you have already done that work nobody (except for you) can really take it away from you. Even if Google or some other market maker does not like you then you still have other social leverage and exposure which can be used to help generate revenue, launch new websites and projects, or (God forbid) get a real job.

I posted the cartoon version of this post about a month ago.

Review of Amazon Kindle 2

My wife recently bought me a Kindle 2. Here are some of the things I loved about it

  • easy to change font size
  • easy to read - Jakob Nielson said it is roughly the same speed as reading a regular book
  • lightweight - 10.2 ounces
  • easy to travel with
  • solves my buying too many books and bookshelves problem
  • you can store notes in it (everything is backed up on Amazon's servers)
  • You can search against all your books and notes in it (which really turns it into a powerful reference library...makes me want to buy about 3 or 4 of them to store different topics in) . This should be VERY powerful for looking well researched and finding money quotes. Steven Johnson (one of my favorite authors) uses Devonthink when he writes a book.
  • it has an audio/reader version baked in
  • it has an Oxford dictionary baked in
  • new books are typically only $9.99 and take less than a minute to download
  • it starts off where you last read

While it has many shades of gray, it lacks color and does not have a touch screen interface. It is a nice device and will make moving far easier than it would have been if I kept buying so many physical books.

If books get more interactive with more permiable barriers when they are digitized then they may play a much bigger role in the web graph. Google's copyright settlement with authors and publishers may make Google more likely to promote books:

“When someone goes to Google, they've got a question in mind and an answer they need,” Jennie Johnson, a Google spokesper son told DMNews. “We don't really care where [on the Web] that answer comes from. If it comes from a book, great; if it comes from a Web page, fine.”

One of the things I regret over the past couple years is that I let my reading slide. If early usage is any indication of future usage then hopefully the Kindle will help me get into reading more often.

Interview of Jonathan Mendez

I have been a follower of Jonathan Mendez's Optimize and Prophesize for a while, and recently interviewed him.

At SES in New York you are speaking on a panel titled "search becomes the display OS" - what does that mean, why is this shift happening?

The shift is part of the Darwinian evolution of the web. Many people have mistakenly viewed search as a channel when in reality it is a behavior. It is the way people use the web. This is clear as YouTube is now the #2 search engine, Facebook, eBay & Craigslist are in the top 10 search engines and Twitter is trying to position itself as a real-time search. Search is integral to the web experience.

From the display standpoint we need to keep in mind that this medium does not need ads to support it nor are ads part of the experience. Display advertising was built as a parallel platform - not weaved into the web like search but placed on top of it. Display has always had its own ecosystem of real estate, content and serving that is separate from the public web.

What we’ve witnessed with display’s lackluster performance and the inevitable crash of CPM rates is the idea of it being a stand-alone platform was wrong. Display needs to be an application that is integrated with web platform and the way people use the web. It should be based on user controls and rules based delivery of content. To truly be relevant and useful for people, publishers and advertisers, it must become a web service like search.

Search is currently at the center of the web. Do you foresee any technologies or services that might shift its position?

On the contrary I think it will become more entrenched and important since everyday millions of new pieces of content data keep getting added to the web and older content gets digitized. As I mentioned search is basic human behavior. We all go online with a goal in mind to either recover information and content or discover information and content. Those behaviors are primal. No technology or services will shift them.

How do you place value on a search impression?

The value is based on what you do with the information. Impressions are the ultimate arbiter of interest and demand. Of course if you go to Google trends often you will become somewhat worried about the collective psyche of this country. In all seriousness however, this is business intelligence. Quick story about impressions - a few years ago I was working with a big client and they were launching a new product. We had purchased the category kw for this product over a year and it hardly had any impressions. We strongly advised them against spending two million dollars to launch this product because there was no demand for it. They didn’t listen to the “search” guys. Within a year the CMO was fired because the product flopped. So in that instance I would say those couple hundred impressions were worth two million dollars.

One of the most powerful pieces of search is that the ad unit looks just like the content. What can publishers do to maximize ad integration without risking their perceived credibility?

In my experience you add credibility as a publisher if you provide helpful, useful and interesting content. There’s no reason that can’t be an ad. Most everyone I know has clicked on a Google ad. Sometimes it is preferable. This creates value to Google as a publisher. Ads that are helpful and interesting will add value to other publishers in the same manner because they are helping their visitors. People rarely forget who helped them in a useful way whether it be a website or “in real life.” In fact there is a large intangible value that is not even being captured when this happens. I think some people even refer to it as branding.

What can publishers and vendors learn from the dominance of search when thinking about how to build and brand their websites? What are some easy ways to make our user experiences more relevant?

Give people control over the delivery of content. The most successful online segmentation strategy is when a person tells you what they want -- self-segmentation. That is the beauty of search. The keyword is the ultimate expression of people’s goals. No website or advertiser knows more about what I want than I do! It explains why the best and most successful experiences on the web (Google, eBay, Craigslist, Yelp) have query fields and lots of text links and it is something I always keep in mind in doing page design. As far as branding I think that goes back to what we were just talking about, the site experience. Great experiences build brands and that is the same online as well as off. Keep in mind all of this should be tested and optimized. It is no accident that Google is the #1 brand in the world without spending a penny on advertising. From day one no one has tested online experience more than Google.

Many people have been promoting Twitter as a Google-killer in real-time search. Why are they wrong?

You mean besides the fact that Google made $21B in ad revenue last year has $8B in cash, owns half a million servers and Twitter search has probably 10 employees and no revenue?

There are some major problems with RTS. First let’s start with the way people search. This has been studied and very clearly defined over the years by brilliant people like Andrei Broder, Daniel Rose and others. I recently took the query classifications they defined and applied it to RTS (http://www.optimizeandprophesize.com/jonathan_mendezs_blog/2009/02/misguided-notions-a-study-of-the-value-creation-in-realtime-search.html). I came to the conclusion that with optimal RTS - which is a huge challenge as I’ll get to - that less than 20% of all queries would benefit in anyway from RTS.

As far as the technical challenges spamming would be very hard to filter in real-time. Also authority as we know from PageRank is a fundamental driver of relevance. How do you define authority in real time? If you do not rank results than is it just a noisy stream? I’ve come to the conclusion that if it RTS becomes anything useful it will be a search vertical, like travel. Helpful for certain things but nowhere near a primary search tool. It is still a great addition to the web but not something Google needs to be concerned with. In fact I think Google is in the position to provide RTS for the entire web which is much more useful than RTS for a single app.

How slow and painful will the transition of ad dollars from offline to online be? What will be the catalyst that allows ad agencies to push search and online aggressively?

Very slow, but this shouldn’t be painful. We know the attention is online so dollars will continue to increase but I think a $25 billion dollar online industry is pretty good right now. It’s grown much faster the past few years than even the most bullish forecasts from five years ago. The catalyst will be innovation and the businesses themselves that must demand performance. Bill Gross the inventor of PPC said it best, “the true value of the Internet is in its accountability…performance guarantees have to be the model for paying for media.” As soon as we embrace performance for all advertising, even so called brand advertising, we will prove our value and grow our industry. Google stands as proof of concept for this. But the battle over performance will be long and bloody. In just the past couple of weeks we’ve had groups like the IAB and the AAAA speaking out against performance and metrics. This type of rhetoric and their fear of accountability are actually helping to slow down the transition.

How many newspaper companies do you see lasting through this economic downturn?

Not too many. Besides the fact that their authority over the past years has waned with bloggers and false reporting the real problem is that newspapers are not an efficient means of information compared to everything else we have today. What percentage of the paper is relevant or interesting to you? 5%? 15%? Yet you are paying for the entire paper when you buy it. Doesn’t make sense. We used to have town criers too, but then newspapers came along. I don’t think most people will miss them. Times have changed. Maybe we’ve just come full circle – people getting their news from other people they trust is the best way to disseminate information. Who trusts the papers?

What will the online vs offline divide look like in 2 years? 5 years? 10 years?

I’m not so sure we’ll have a divide in 5 or 10 years. The kids graduating high school this year were 8 years old when Google was started. I see kids 4 and 5 years old naturally manipulating iPhones. Many of us have persistent web connection and we like it - we feel uncomfortable without it! Of course it’s nice to get off the grid sometimes but what is happening with digital technology is the great story of our age. Everything is becoming digital, addressable and connected via the web. All of us lucky enough to be working here will reap the rewards of that in the coming years because the growth of digital will far outpace the amount of talent in the workforce. We should have bigger paychecks in 5 years!

Many people focus on one particular segment of the market, whereas you seem to have a well-rounded knowledge of SEO, PPC, user experience, and conversion strategies. How did you find the time to tie all these different disciplines together?

Well, I’ve been at it 11 years so that accounts for the time. It is corny but I love the web and I am passionate about trying to make it more relevant to everything we do. Looking back my career path from Site>Email>SEO>UX>SEM>LPO>Display, it seems like a very natural progression to me. Basically, with one stop for UX I have just been a marketer trying to stay ahead of the advances in marketing technology. Also, I love learning how people use the web and all the disciplines I have worked in are fundamentally rooted in the same thing -- understanding people’s goals and optimizing the delivery and presentation of information to meet those goals. As an industry we tend to divide the web into vectors but we often lose sight that the web experience for people is linear. The more holistic understanding we have generally the better our results.

_____________________ Thanks Jonathan! To read more of his thoughts check out Optimize and Prophesize.

SEO Linguistics: Updates, Changes, Glitches, Semantics, & NOISE

A lot of our best SEO tips are shared on the blog here. That strategy originally came to be because my original business model (for this site) was to sell an ebook, and it was hard to stuff everything inside 1 ebook and expect it to come out congruent, especially

  • while selling it to a wide audience
  • when revising it many times
  • with SEO touching upon so many other disciplines like psychology, sociology, public relations, branding, advertising, content creation, information architecture, social networking, algorithm testing, etc.

Admitedly the ebook was a work in progress. As the search algorithms evolved and my knowledge of the field of marketing improved there were always new ideas I could add (or remove or change)...things where I said "hey I could make this part way better." But to be able to do that, you have to be able to look at your old work and admit where you were wrong or ignorant (or correct, but shortsighted).

After 4 years of making such updates, you get a lot better at seeing some of your own flaws and thinking about things you could do better, and you get better at seeing underlying trends in the search algorithms...especially as you grow your sites, track the search results, read customer feedback, read search research, read algorithm patents, read Google's internal company documents, and listen to engineers speak in Fed Speak. Each data point adds value to the next.

When I was new to the SEO field, learning SEO was much less complex because the algorithms were less complex and because the market did not have the noise it has in it today. Today there is no shortage of complexity in the SEO industry. But then the SEO industry is made to seem even more complex than it is by people playing semantic games, people willfully misinforming others, and those so desperate for attention that they are willing to write anything in hopes of getting a link or a mention in social media channels.

Rather than calling the update an update (as they are traditionally called) Matt Cutts preferred to call (what we saw as an update) a change, but as Michael Gray mentioned, those semantics are irrelevant unless Matt chooses to share more information

When you go around stating there was no update (your definition), when we can clearly see there was an update (our definition), we’ve got a problem. It looks like you’re trying to perform some Jedi mind trick, if you keep repeating there was no update and waving your hand eventually we’ll all believe you. Even worse it’s like you’re trying to tell us what we’re seeing isn’t really there and this is one of those “these aren’t my pants officer” moments from cops.

Language is powerful. If you control the language you control the conversation.

Even after Matt Cutts said in a video that they made a change, people began passing around that video on Twitter noting how I was wrong about the update and that there was no update. Some of them were probably the same people who denounced the position 6 issue we mentioned - a penalty/filter that was denied, changed/fixed, and then - and only then - a glitch.

I am not sure what sort of bizarro world those "I told you it was not an update" people claiming to be SEOs come from, but I thank them for polluting the free SEO content available on the web and misinforming so many people...they are part of what makes our training program so popular and profitable. They also make the search results less competitive - anyone who is listening to them is heading in the wrong direction building a weak foundation. :)

Download SEO Book Torrent: Should Google Recommend That?

In the following video Matt Cutts highlighted that he did not feel that the update was driven by brand, but more in concepts of trust, PageRank, and authority:

RankPulse, a tool I used in my analysis of the algorithm change, is powered by the Google SOAP API, which Google will soon stop supporting. Matt played down the size of the algorithm update made by a Googler named Vince. But John Andrews takes a contrarian view, looking at Google's behavior after the algorithm update was analyzed:

You might say that Google’s API,via custom third-party innovations like RankPulse.com, enabled us to “organize the world’s information and make it universally accessible and useful” (which is Google’s corporate mission statement, by the way).

It sure seems contradictory for Google, a company based on the collection and permanent storage of others’ web page content, to forbid others from doing the same. It is also quite egregious for Google to expect to operate secretly, with no accountability (such as might be obtained through archiving of Google results), when Google exerts so much influence over Internet commerce.

One of Google's initial complaints, as mentioned by Joshua Sciarrino, was that search information was too secretive:

At the same time, search engines have migrated from the academic domain to the commercial. Up until now most search engine development has gone on at companies with little publication of technical details. This causes search engine technology to remain largely a black art and to be advertising oriented (see Appendix A). With Google, we have a strong goal to push more development and understanding into the academic realm.......However, it is very difficult to get this (academic) data, mainly because it is considered commercially valuable.

As Google gobbles up your content while shielding its results from unauthorized access, it creates a weakness which a new search service could exploit...by being far more open.

While Google doesn't want anyone to access their proprietary business secrets, if you search for my brand they recommend you look for a torrent to go download an old copy of my ebook.

sounds like a fair trade, eh? No big deal. Google is a common carrier, and intends to use that to their business advantage whenever and wherever possible.

I hope you (and your business model) are not allergic to peanuts!

Lots of SEO Conferences Coming up Soon

As paid search's growth slows, marketers are looking to invest more into organic SEO strategies.

There are a lot of SEO conferences in the next month. One of the easiest ways to grow in a down market is to network. Why? The web is a social network, and sometimes just a few links separates the top player from a #3 ranking, and the people who can afford to invest in education and marketing in a down market are clearly successful (and, thus, worth networking with and learning from).

  • SearchFest is in Portland, OR on March 10th
  • Pubcon South is in Austin, TX from March 11-13
  • Search Engine Strategies is in New York, NY from March 23-27. Here is a coupon for 15% off SES NY15BK. If you use the coupon please make sure to attend the IM Charity party to give back some of the money you saved, as a lot of charities are hurting this year as budgets get cut back. SES also has an Amsterdam conference and training in Denver & Atlanta coming up soon.
  • IM Spring Break is in Deerfield Beach, FL from April 2-4.
  • SMX Advanced is not too far off either...it is in Seattle, WA from June 2-3. In our member's area we have a coupon for $100 off of SMX. Between now and that conference SMX also has conferences in Toronto, Sydney, Munich, London, and Madrid!

If you have never attended a conference, it is worth attending at least 1 or 2 to see what they are like, do a bit of networking, and learn more about the space. With the conferences occurring all over the country (and world) it is quite easy to find one that suits your calendar and budget.

Aaron interviews Ben and Karl from Conversion Rate Experts (CRE)

A few months ago, I hired Conversion Rate Experts to work on my business. I have learned loads from them. So far they have grown our conversion rate by 124%, and have given me great insights into the thought process of consumers hitting this site...reminding me why they buy, and how ineffectively we were conveying the value of all the different components of our offering. 124% is a good start, and we still have a lot of things to improve upon.

Earlier this week, I interviewed them for this blog, so you can benefit from their advice too. The interview contains loads of tips you can implement today to grow your business.

Aaron: What made you guys start Conversion Rate Experts?

Karl: Several years ago, I started working with Ben, who had been working in web marketing for years. I have a Ph.D. in rocket science, and we discussed how we could take a scientific approach to increasing the conversion rate of our employer’s website. Within twelve months, we tripled the website’s profits, to $9.1 million.

At that time, we had just bought SEO Book, and claimed our free 20-minute call with you, Aaron. We asked for your advice, and you recommended we “Give away as much valuable information as possible”. We took your advice, and, a few weeks later, launched Conversion-Rate-Experts.com with a free report called Google Website Optimizer 101, which described some of the techniques we had developed.

The report went viral, getting on the homepages of Digg and Delicious. By the end of the week, we’d been featured on the Alexa.com home page as the third-fastest-growing website, in their “Movers & Shakers” list.

The following day we were contacted, out of the blue, by Google’s Tom Leung, who suggested we partner with them to offer consulting services. We said no at first (what were we thinking?!) but, six months later, we decided to go for it. Since then, we have had some fantastic successes for clients in some highly competitive industries—including weight loss, travel, gaming, technology and health and fitness.

Aaron: Lets say I have no idea who my customer is...but my boss wants me to give a report on the topic at the end of next week. What should I do?

Ben: Speak with your sales people—or customer support people. They understand your customers in much more depth than any web analytics report could give. They know what the customers care about, and what their major objections are. If you have no customer support people, consider temporarily adding a phone number to your website, just to give yourself an opportunity to speak with customers.

To show you the extremes we go to to hear the “voice of the customer”, here are a few of the things we have done to get face to face with real prospects:

  • Sold travel products in airports, from a stand that was rented for a few days.
  • Sold phones at a market. (We were in a hurry to gather objections for a new product, and the market allowed us to just turn up on the day.)
  • Joined a local slimming club. (This was by far the most embarrassing.)
  • Attended a local bingo hall.
  • Opened up Japan’s first-ever Nokia store.
  • Ordered antibodies through the post. (They’re still here on the desk—we don’t know how to get rid of them!)

Other great services include Crazy Egg, Kampyle, ClickTale…and of course, web analytics software. We created a summary of some of the services we use regularly.

Aaron: Testing…personas…consistency in messaging. What is more important for improving conversion rates?

Karl: Consistency in messaging should be a given. If your messaging isn’t consistent, you’ve got a “dog’s dinner” of a website.

Testing, too, should be a prerequisite; without testing, you can’t confidently be sure whether you have improved your conversion rate or not.

You definitely need to understand your visitors’ intentions and mindset. This should be done by real research, not just “ivory towers” guesswork. Many web marketers fall short at this point. They ask us how to increase their conversion rates, and the first question we ask is, “Why are most of your visitors leaving without spending a penny”…and they can’t answer the question! These people would struggle to create just one realistic persona, never mind five of them. Personas can be a useful way of considering different types of visitor, but as long as the personas are based on a real understanding of your visitors—otherwise you’re just sitting in an office, creating soap opera characters.

Aaron: What is the single biggest thing most sites screw up in the conversion process?

Karl: Most web marketers work on the wrong part of their conversion funnel. For example, they might over-obsess on their landing page, but forget that they don’t have a refer-a-friend program.

One of the first things we do is to look at the whole conversion process—from visitor to repeat customer—and look for the opportunities in the chain. We have an immediate advantage because we can see the website with fresh eyes.

Aaron: Did you ever make a mistake during the conversion testing process that surprised you and worked really well?

Ben: We regularly carry out usability tests on our clients’ websites. During one test, the participant mentioned that he’d prefer the page to have a different background colour (the color to the left- and right-hand side of the page). We mentioned it to the client in passing, who then tested it. The client saw a 9% improvement in the site’s conversion rate, worth $400,000 per year. We were amazed that such a subtle change could make such a massive difference to a business.

Aaron: Many of the internet marketers that do email-based marketing are willing to lie to make a sale. It makes sense that get rich quick people are easy to monetize since they want to buy a dream. How does one compete with such a sales strategy in a field where competing businesses overtly lie?

Ben: Prospects are hungry for proof—and they’re surprisingly good at detecting lies. If you can show irrefutable evidence that your offering is best, you have an enormous advantage. SEO Book’s success is largely due to your integrity, and the high quality of your information. You might call it “white hat” conversion! And, as with “white hat” SEO, it’s the easiest way of building a long-term sustainable business.

Aaron: Sales optimization vs exploitation: some people push it too far, whereas most businesses are way under-monetized. Where do you draw the line between improving conversion rates and misleading people? Is misleading people ever profitable in the longrun, or do the people who do that need to keep starting over again and again.

Karl: The best approach is to offer people what they want—and then deliver it. Monetization doesn’t mean exploitation. We regularly ask this question to our clients’ customers: “What would persuade you to use us more often?”

You’d be surprised how many customers ask the company to offer more products or services to them.

Aaron: From my experiences, with Adsense and ad click based business models it seems like it would be easier to monetize people of limited topical knowledge and limited knowledge of the web. And some people who have been around forever feel they already know everything. Yet some models work best monetizing at the higher end. How does a business owner know what types of customers they should target?

Ben: There’s no one right answer. Some companies—such as 37 Signals, with their collaboration tools—target the lower end of the market, and some—such as Accenture—target the high end. It depends on which segments of the market are currently being neglected by vendors, and how you feel you can add the most value.

Aaron: If a person targeted the wrong audience for years, is it easy to later shift to the right target? How does one shift without losing market momentum?

Karl: Here’s a great way to identify your company’s opportunities: Quickly write down two lists:

  • List your company’s strengths. These are the things that you company is good at, and that competitors would struggle to compete with you at, because there’s some “barrier to entry”—whether that’s because of a skill you have, or an asset you have. For example, SEO Book has an enormous readership, a reputation for integrity and intelligent commentary, true expertise in SEO, many successful customers, and a large number of respected contacts in the SEO world. Any new competitors would struggle to compete with those things.
  • List your company’s opportunities, in terms of what people are willing to spend money on. The best way to get this is by understanding your customers. If you don’t know what they’d like to spend money on, ask them, in person or by survey.

By studying these two lists, you should be able to find opportunities that you are best-positioned to serve. The question to ask is, “How much money could be made from this opportunity, and could my company be the best in the world at providing this service?”

Often, you’ll find that your biggest opportunities are right under your nose.

Often, the answer is to narrow down the opportunity to a very specific focus. For example, rather than aiming to provide SEO services to everyone, maybe SEO Book could specialize in providing linkbait services to small businesses.

It can be scary to narrow down your focus, but it’s often the most lucrative strategy. To get a good understanding of how to focus and positioning can help a business, read the chapter “Positioning and Focus”, pp. 103–127, in the book Selling The Invisible by Harry Beckwith.

By the way, the above exercise isn’t just useful for businesses—it can be really useful for planning your own career.

Aaron: Do you ever use public relations as part of your conversion enhancing strategies?

Ben: Yes, frequently. We have managed to get our clients into magazines such as TIME magazine and the Wall Street Journal. Press mentions can lend loads of credibility to a product or service—and they can’t be used by competitors.

While working on a weight loss website that generates $5 million/year, we noticed that the company had a fantastic press testimonial that wasn’t prominently displayed on their website. By moving this information “above the fold”—and reformatting it—we managed to create an overnight 67% increase in sales.

Aaron: How important is social proof of value to sales?

Ben: Social proof can be extremely persuasive, particularly when other forms of proof are scarce. For those of your readers who don’t know what social proof is, it’s often known as “herd behavior”; when people are unable to determine how to behave, they will tend to imitate the behavior of others. Marketers often use social proof by demonstrating how other people are using their services. Here are a few examples of social proof:

McDonald’s “Over 99 Billion Served”

The Elvis album entitled “One Million Elvis Fans Can’t Be Wrong”

Aaron: Many customers who like a product or service do not give feedback about it. How do you encourage them to do so?

Ben: Most companies don’t have this problem: they just don’t ask for feedback, because they’re scared to hear it. When was the last time you went to a restaurant and they genuinely wanted to know what you thought of the meal?

Karl: However, sometimes your best customers are also your busiest customers, so you need to reward them for sparing some time to give feedback. In these cases, you may consider rewarding them for sparing the time.

Aaron: Throughout my blogging history I have seen an amazing correlation between controversy and sales. Do you ever suggest clients make a ruckus to gain exposure and increase their sales?

Karl: We haven’t done so, but mainly because it’s more a traffic technique than a conversion one. The client would need to feel comfortable with “riding the storm of controversy”, which tends to scare a lot of people.

Aaron: What type of traffic converts best?

Karl: Existing customers convert very well, as do visitors from refer-a-friend programs.

Aaron: Is search traffic the best type of traffic to test conversion principles on? What other sources are worth testing aggressively?

Ben: We test on whatever traffic the website is currently getting—but avoiding, where possible, traffic that is transient, such as one-off campaigns.

Aaron: Do you prefer to do straight A/B split testing, or to test changing many variables at once?

Karl: We recommend clients start with A/B split testing, because it’s less complex. Multivariate testing is just carrying out several A/B tests simultaneously.

Aaron: When does it make sense to do incremental changes? When does it make sense to blow things up and start from scratch?

Karl: It’s a case of “baby steps” versus “giant steps”. If you’re confident that your giant step will be a winner, then it’s often worth testing, especially because large improvements can be detected much faster.

Aaron: If someone clones one of your products and makes it free how do you counter that from a marketing standpoint?

Karl: This is a question that many industries, such as the music industry, are currently facing.

It’s important to bear in mind that people pay for SEO Book’s training program because of the following: the community, the mentions in the world’s press, the popular blog, the fact they know and like you. Those things can’t easily be cloned.

Kevin Kelly wrote a great article about this difficult subject. The article is worth reading, but here is a summary of it, as it pertains to SEO Book:

Immediacy: people will pay a premium to have first-access to something. For example, people would pay extra to have early preview copies of new content on SEO Book.

Personalization: people will pay to have something that’s personalized for them (even though the personalization doesn’t need to be extreme). For example, people would pay more just to have someone tell them which parts of SEO Book’s training program they should focus on first.

Interpretation: people will pay to have something explained to them. For example, Google Website Optimizer is free software, but many clients pay to have help in setting it up.

Authenticity: people will pay more just to know that their copy is authentic (up-to-date, legal, free of erroneous information, etc.)

Accessibility: people will pay to have instant access to a hosted service, rather than having to look after and manage it themselves. With SEO Book, people would rather have access to the continually updated membership site rather having to constantly have to keep all the training videos up to date on their own computer.

Embodiment: people will often pay more to have the product in a “real” format. They may prefer to have SEO Book’s courses available in a printable format, so they can read it by their bedside, or they may prefer to attend an Elite Retreat session, so they can see you and your colleagues speak in person.

Patronage: sometimes people want to pay the product creator, because it allows them to connect.

Findability: sometimes, the main service a company makes it to raise the awareness of a product. For example, many people wouldn’t be aware of the SEO Book training program if it weren’t for all the channels (blog referrals, search rankings, affiliates, etc.) that direct visitors towards the seobook.com website.

Aaron: What were your biggest personal business hang-ups, and how did you get over them?

Karl: We tend to be perfectionists, and our blog readers often complain that we don’t publish enough. On the upside, our reports tend to get loads of attention when we publish them. If you would like to learn more about conversion, I’d suggest you view the free reports on our website, and sign up for our free newsletter.

____

Thanks for the great interview guys!

Pages