Welcome to the Casino…Have a Nice Day

I’m not good with Casinos….I’ve been to Vegas any number of times and on the last half dozen visits I don’t think I’ve gambled more than five bucks.  It’s partly that I don’t trust myself to get into something that addictive…part that I worked hard for that money and part that I’m just not good at it. There is a giant casino out there where the punters are playing marketing dollars for sales and it’s called Google. Historically Google has largely been the resort for large rich companies with teams of marketing professionals like us pitting their wits against the house.
Whilst Google has been doing very well of late with ad revenue up nicely in Q4 last year, the average click value declined 11% in the same period. What’s diluting the click price is the massive growth in mobile device clicks which (as yet) aren’t as valuable as desktop clicks. The problem Google has is that mobile clicks have already surpassed desktop and show no sign of slowing down.
So whats a giant Casino to do when the punters are growing in volume but avoiding the high stakes tables. The Casino either gets the same punters to spend more time at the high stakes table…or attract a bunch of new punters…hopefully without as much expertise as the existing crowd. I live in SoCal and we have an amazingly large number of Indian Casinos in our region (I know a guy who services slot machines and he has over 100 locations he serves within driving distance). What the Casinos do is bus punters from location to location all day long.
Yesterday Google’s Chief Business Officer made some interesting statements to the financial world at a Morgan Stanley Conference. Disambiguating these kind of statements is tricky…but several points seem to be emerging through the linguistic fog of Google speak.  
Google sees small local businesses looking to reach local customers looking for local customers on their mobile devices as the next influx of fresh meat to their Casino
It thinks this influx will drive the value of mobile clicks to “become a multiple” of the comparable desktop clicks…..which would nicely solve the problem of mobile clicks driving down average click value.
That’s a really interesting set of statements. We already see the impact in local businesses (most of whom aren’t online marketing experts) joining the casino. Online advertising isn’t a sport for the inexperienced…it’s incredibly easy to put money down and blow through it in perhaps seconds without the advertiser seeing a single cent of return on their investment. We know from our own efforts that tracking the ROI for local businesses can sobering.
The risk is that Google will continue to market aggressively to local businesses who will show up at their Casino slap the college fund down and leave never to return because they simply didn’t see the value. Google has recently been telling the cohorts of marketing professionals who have been spending with them for many years to look beyond the obvious conversion event and look for value driven by search all over the web. It’s possibly a good argument to make to Nike or Apple…it’s much tougher to convince a roofer or dentist of almost invisible value.  

Our business is based on driving proven ROI in the form of tracked calls.  The mess created by local businesses headed into the Google casino is likely to make businesses even more suspicious of everything online…which might be great for us long term it puts many of the tables out of reach for the professional gamblers amongst us.

Local Online Confusion

rsz_local_open (1)

The chances are that you are reading this on your smart phone or tablet or perhaps you are taking a break from your phone to read this on your computer or even on that charming ‘dead tree product’ called a magazine.  So much of how we live and shop has moved online.  Large companies with massive marketing budgets now have teams of online experts figuring out how to reach their audience through the complex web of new media often in tandem with traditional media.

Now answer this question: When was the last time you interacted with your yellow pages?  I don’t mean when you picked it up and walked it straight to your recycling bin, I mean when you last used it to find a local business. Thought so…me neither.  There was a time quite recently when your Sunday paper had to be lowered buy winch onto your front porch…now, if you still get it all, it’s clearly been on a severe diet.  We have been living through a massive realignment of media…print media has been vaporizing before our eyes.

What hasn’t changed anywhere near as much is the rest of our every-day issues.  We still get tooth aches, leaks in our pipes, pest infestations and we get married.  We still use dentists, plumbers, rat catchers and party rental stores.  The massive real world operation which is the twenty million local businesses in the US still do business every day.  What went away is the way those businesses use to get new clients.

It used to be that owning a home and sending your kids to college was the American Dream.  Those have become much closer to the new normal for many Americans, now owning your own business has become for many a new part of that dream.  The BIA Kelsey organization, experts in all things local, tells us that each year roughly half of all business done by local businesses is new business.  Local businesses get that and are desperately trying to come to terms with a radically altered local advertising environment.  It’s no longer good enough just to have a basic website, local businesses really need a social media plan, they may have to manage their online reputation, they may even tweet!  The complex and rapidly changing world of online media is tough for a freshly minted MBA who went to school to learn this stuff – it’s simply impossible for the average local business to navigate.

Clearly this presents a problem to a large and growing segment of the US economy.  Interestingly, a solution has emerged in recent years and Search Initiatives, Inc. is leading that revolution.

Most local businesses don’t value “clicks” to their websites, “likes,” “tweets,” or “reviews.”  Most would much rather get a telephone call from a potential customer looking for a quote or to schedule a service.  People certainly do research online but when it comes to get serious about the project at hand many shoppers would rather speak to the company involved.  That makes the 100 year old telephone a critical part of the new media economy.  Local businesses have figured out that rather than pay a marketing company, yellow pages or newspaper for websites or clicks they would rather pay for calls from potential customers.  Those customers may well have come from ads seen on search engines, social media even banner ads…but that’s not the concern of the local business who only pays when the phone rings.  Those businesses are more than happy to pay a premium for those calls.  A dentist may pay $40 for a new customer a home security company may pay over $100 for a call from a potential client because they recognize at a profound level that the potential customer on the phone is a much better prospect than any other kind.

Interestingly, these local businesses are still being sold to by the same yellow page or news print reps but instead of just selling print they are being sold online visibility packages which typically include a website, social media management and most importantly a certain number of leads delivered by tracked telephone calls.  This has driven a massive growth in the “Pay per Call” industry and Search Initiatives is leading that sea change.

Local businesses need to advertise, yet they are unable to navigate the complex world of new media effectively.  There is a pent up demand in the form of the billions of dollars which have fled traditional print media and have not yet found a place in the new media world.  What Search Initiatives does is use the complex and challenging tools presented by new media such as SEO, SEM, RTB, FBX, PPC and a dozen other acronyms which you will hopefully never have to come to terms with to drive new customers to local businesses via the paid phone lead.  It’s a concept which any local business can understand and embrace.  They only get changed if a potential new client is brought to them…if we can’t deliver we don’t get paid.

Search Initiatives has deep roots in new media and local business.  We work with the people who sell to local business to deliver the calls they need.  That means we have almost no cost to acquire a new customer.  Our millions of advertisers are managed by our marketing partners.  They provide all the customer support to our advertisers.  That leaves us free to focus on what we do best; driving thousands of valuable leads to local businesses in massive volume.

This new version of local advertising uses the kaleidoscope of new media to drive customers to local locations   Search Initiatives is ideally placed to be the one stop solution for all things local.  It’s a multi-billion dollar opportunity which represents the last green field opportunity in new media and Search Initiatives is ideally placed to lead that revolution.

Google Bug Watching for Beginners

Google watching is endlessly entertaining….today it got entertaining in an unexpected way. A geek with I’m guessing way too much time posted on Quora that some searches which should be impossible to resolve rather than returning no results at all actually return tons of porn.

This isn’t something the average user is likely to have come across accidentally, most people don’t do advance syntax based searches on Google…but if you did and asked Google for an answer to a logically impossible query like “-4 “1 4” in which you are essentially asking for results which don’t contain the number 4 but do contain the number 1 space 4, rather than returning no results in this case Google returns 808,000 results most of which (upon very cursory inspection) are porn links. This trick even works with “safe search” filter turned on. Weirdly, similar impossible queries like -4 “4” return no results and -4 “14” returns results which don’t have porn links.

Leaving aside what kind of extreme search jiggery pokery you would need to be doing to even find this effect it’s a hilarious bug. According to Google engineering post on the topic sadly it’s not a secret lonely nerd feature, it’s just a bug.  This is fascinating. We don’t often get to see explicit bugs in Google search in real time…especially not bugs of this magnitude. This presents interested parties with the opportunity to witness just how long the Googlies take to track down, fix and deploy a really clear bug in main search. I’m guessing less than two days. The clock is running, let’s see how long it takes.

Meet the New Boss…Same as the Old Boss

Search at Yahoo has languished somewhat since Bing took over their search back in 2008 after a failed bid by Microsoft to buy Yahoo. There has always been an antitrust concern about the search on Yahoo being powered by Google…so I was interested but not that surprised to read today that Google contextual ads will now start showing up on Yahoo properties and more importantly Yahoo mobile traffic. To be clear this isn’t the same as main search on Yahoo being taken over by Google, rather these are contextual AdSense ads displayed on billions of Yahoo web and mobile pages…which will presumably represent a significant revenue opportunity for Yahoo.  It makes perfect sense as Google’s ads are generally more valuable than Yahoos and they have a larger stack of advertisers to play with. At the core of the deal is the dramatic growth of mobile. Millions of people use Yahoo mobile content to keep them up to date with news, celebrity, finance sports and email. Google has a much stronger mobile platform so adding Google mobile ads to the enormous Yahoo mobile inventory. Google doesn’t (yet) have the kind of vertical interest Yahoo boasts so that’s likely to be an upside for them both.

Google survived an  FTC investigation into monopolistic practices last year and is still under scrutiny in the EU, so making a move which further centralizes Google commercial control could be thought of as ballsy.. but in a race to grab as much real-estate as possible before the new Search at Facebook gets out of short pants it makes perfect sense.

Google is Racial Profiling?

You can’t make this stuff up. I checked the calendar and it’s not April 1st. According to a story I found in the Boston Globe Latanya Sweeney a Harvard University academic noticed that when she searched for herself on Google or more precisely a site powered by Google search she received ads back for (amongst other things) criminal back ground checks for her name. She then did a more extensive test and actually wrote a research paper which found that distinctively “black” male first names are 25% more likely to return an ad from instantcheckmate.com offering background or criminal record checks than traditionally “white” names. She doesn’t draw any conclusions other than that this could be problematic for people of color….but the allegation that Google is somehow racially profiling is in the mix.

Of course even a cursory examination of the facts (as opposed to the hilarious conspiracy theory) is (allegedly) that instantcheckmate.com is in fact targeting what it believes to be ‘black’ names with ads for criminal background checks as opposed to more generic services for ‘white’ names. Google racially profiling would be a much better story.  The same thing would apply were I targeting Russian fur hats or nesting dolls to people with Vladimir for a first name.  It is a sad reflection on our society that (according to federal statistics) black males are seven times more likely to end in jail than their white non Hispanic peers. Logically that makes them more likely to have a criminal record, so it makes a twisted kind of common sense to target uniquely black male names with criminal background checks advertisements….but it’s not the Google Geeks doing it.

Social Discovery is Out to Get You

I don’t like social discovery, at least I don’t want people who don’t know me but might share interests discovering me without me looking for the attention. So the rumors swirling around Facebook and social discovery are interesting. The inside word is that a high octane team from Facebook including ex Googler Peter Deng and folks from Glancee a location based company FB acquired in 2011 are working full tilt on an Ap to be with eager mobile FB users sometime in March. It looks like the App will ‘know” and alert your when one of your FB friends is in your near vicinity even if the App isn’t running. I can imagine that this might generate “friend spam” where (for example) you are friends of folk you work with your phone constantly letting you know that your friends are nearby.

Where it gets really interesting is how the app will likely go beyond just friend discovery. If taken to a logical conclusion this may allow advertisers to reach out to users who have some level of engagement with their brand such as a ‘like’ with a brand message or offer. In this use case as you pass Starbucks they might hit you up with a special offer or coupon. Given FBs horrible record with end user privacy issues the key question will be “will they be able to withstand the temptation to reach out and spam us with offers and deals”.  Either way the smart device in your pocket is about to get even more chatty….and potentially annoying.

Digital Migration Into Uncharted Waters

So what’s a marketer to do? If you keep an eagle eye on Industry trends you will see some interesting and conflicting trends. The continued migration of dollars away from traditional media continues at pace. A survey from the American Marketers Association shows a 20–30% of respondents plan to move money with (as usual) newspapers being top of the hit list. Digital media in general and social in particular are slated to be the beneficiaries although mobile is lower than I would have expected. However, all is not necessarily sweetness and light. Although marketeers are trending to digital many of them remain confounded by the efficacy of the new medium. In another survey from Vizu another set of marketeers are unsure of how effective it is. In the survey fully two thirds of those surveyed were bullish on social media in general but unconvinced of ROI….a hold out 6% are convinced that it doesn’t work at all..

We are a little different to many marketeers. We don’t do brand support we do results based marketing only. If we don’t get the phone to ring we don’t get paid. We have tried social media as a direct response channel in many different ways with spectacularly underwhelming results. In many ways our hands are tied in that we can’t create social content on behalf of our advertisers and are frequently limited in how we can use logos etc. Mobile is the other large and growing beneficiary of the digital migration and the jury is out on that too.  In our testing of mobile ad delivery search works…and works pretty well. Our testing with mobile display is quite different. Thousands of clicks which don’t result in any calls. Our experience of search targeted media indicates that it takes from 3 to twenty clicks to drive a successful call. Thousands of clicks with no calls indicates that the clicks aren’t from people looking for a product or service.

So as the migration continues marketeers are faced with developing channels which either don’t convert or are much harder to track than traditional media. Part of this complexity is the old marketing adage that half of advertising is wasted but we don’t know which. Digital media exposes exactly what does and doesn’t work…and maybe it’s close to three quarters of all media spend is wasted…and we can now tell which works.

Yahoo On the Mend?

Six months into her new job Marissa Mayer the new queen of Yahoo was able to tell some reasonably good news to investors in her Q4 results call yesterday. Yahoo saw their first uptick in revenue for a good while as Mayer shared the good news from the annual meeting of the great and good in Davos Switzerland last week. She pointed to two clear areas of focus for the newly invigorated Yahoo. Not surprisingly mobile is one of them. That makes a huge amount of sense as mobile is rapidly catching up with the desktop. For all its failing Yahoo has a ton of great content which million of people go to each day for their daily dose of sports, news gossip etc. Making that content mobile and personalized for their millions of users through apps and targeting ads around that offers a significant opportunity for revenue growth. However, the other focus Mayer pointed to is search….yes really search. I have been in the search business for about a million years and back in the day Yahoo powered its own search. Then they brought in the cuddly friendly guys at Google to power it for them (under a powered by Google brand) to run their search for them. Their assumption was that people would use Yahoo for everything including search. Back then before high speed connections users could either sit and wait for a yahoo results page encrusted with ugly ads to load or they could hop over to Google and have a fast clean ad free search result from Google. Weirdly I remember discussing this with several Yahooligans at the time and they honestly didn’t think it would be a threat. A decade or so later…they aren’t quite so sure.

Yahoo ceded search to Microsoft’s Bing a while back so for Yahoo to attempt to gain a stronger position in search without even owning the technology is incredibly ambitious. Doing search well is hard, doing it as well as Google does given the 30 trillion pages Google indexes is incredibly hard. Google has beaten off legal challenges for their rivals and the FTC and become both a noun and a verb…it’s tough to beat a competitor which has become the name for the activity. The mobile opportunity is probably more compelling. When I just checked there are about a dozen separate Yahoo apps out there. The question is can Yahoo weave those separate strands into a strong unique mobile user experience…before Facebook does? The jury is out on that. Certainly Yahoo has done a better job than Google whose mobile news app is just horrible. Their biggest problem is that Google has become the way that most of us navigate the chaos of the Internet and Facebook has become the way we share pics of our kids….all that’s left is mobile, and the clock is ticking on that too.

Google and Skype

OK, I’m confused. As part of keeping ahead of the game I check in with Google in other countries, Canada is often the test bed for US roll outs so it’s always worth checking in from time to time. When I was doing that the other day I noticed something which I haven’t seen before so I thought I’d share. It’s no secret that Google took along hard look at buying Skype last year. There was an internal political power struggle worthy of a movie which went all the way to the top. Eventually they dropped out and Microsoft picked up Skye for $8.5 Bn and they have subsequently announced that they will merge Skype into or replace Windows Messenger. So why, I wonder, when you search for a business on Google Canada do all the numbers light up as Skype dial numbers. If I click a number my Skype tells me I’m about to dial an international number, I assume if I’m in Canada I could make a free Skype call locally. It’s not obvious to me what’s in it for Google for them to promote a Microsoft product as prominently as they are in this Canadian results set, featuring Google Voice would make more sense. If they roll that out to the much larger US market, especially on mobile devices that would be a much more compelling move. Meantime Google had a great Q4 last year with revenues up substantially even though click prices continue to trend down, driven down by lower mobile click prices. On that topic, still no announcement from the Googleplex on their new mobile ad product…it’s coming for sure but no announcement yet.

Flipping Out

It’s not often that I gush about anything. I’ve been in the biz for a good while and any number of gee whiz ideas pass my desk every day, I have seen dozens of “next Googles” and the vast majority are seen then never seen again. So when someone recommended Flipboard for iPad to me recently it took me a while to get round to actually installing the ap. I’m late to the party these guys launched last summer. For a guy who lives online I hate a lot of the online experience. I don’t like reading stories on websites and I find next page navigation annoying and the ads intrusive and boring. Flipboard is a brilliant answer to those problems. Essentially you tell it what you are interested in and it fetches content which matches your interest and presents it in a clean elegant magazine like format. It makes reading and navigating stories seamless and simple, as the name suggests it allows you to flip between stories and sections. It also allows you to log into your Facebook and Twitter feeds and displays that content again cleanly and elegantly formatted. It turns your Twitter feed into your own magazine and makes your Facebook a much more engaging experience.

The result is a simply brilliant way for you to digest online content on your tablet. It’s so slick and so elegant and easy to use I think it could seriously impact other parts of our online engagement. I could see the paradigm overflow into search. Imagine searching on your tablet and flipping between results as opposed to traditional search and click navigation. It’s been a while since we have seen a significant improvement in search results and how we navigate them. Adding the ability to present the results formatted elegantly and simply with flip navigation is intriguing. To an extent Google has been heading in this direction by aggregating data from sites and presenting them in the right rail of the results set. This is controversial with many content producers because if the answer has been scraped and displayed by Google which obviates the need for end users to click through from the results set. Take a look at the results for the “Query Jodie Foster“the right rail presents images, a biography, key film data and other key personal and career data. It’s a short conceptual step to make those results flippable. Meantime, if you have a tablet be sure you download Flipboard to make it twice as useful.