Paul Lomax - Two Point Oh

My ten guiding principals for a Web 2.0 strategy are now available as a slideshow!

These tactics for success will help ensure your site grows its audience and revenue and maximising profitability by harnessing the power of the Web 2.0 state-of-mind.

It has been suggested that many mainstream demographics have not yet chosen their brand online, in stark contrast to their offline worlds. But will they ever chose a brand, or will they just chose whatever comes up first in Google? With the cost of switching being zero, is Brand Loyalty online dead?

The low cost of switching

Mike Moran suggests that Brand Loyalty might “not actually dead, but when loyalty is finally put to rest, its gravestone might say “I told you I was sick.“” Moran attributes this to the low cost of switching on the web.

When Web shoppers’ actual behaviour is monitored, it demonstrates that brand loyalty is on the wane…

Today’s typical Web shopper behaviour is not to head to a favourite online store—shoppers go instead to their favourite search engine and let fly. Whatever sites are shown in the search results become the consideration set for that purchase.

If your well-known brand name appears in the search results, it triggers more clicks than a “nobody,” but that is the extent of brand value today—it doesn’t draw people to your Web site the way it drew them to your physical store.

Some key facts and figures Moran has pulled from various bits of research:

• Just 21% of web shoppers desired information about the brand. The rest wanted price comparisons and detailed product info.
• 92% of all Web users employ search engines such as Yahoo! and Google to shop or purchase online.
• 92% of searchers never use brand names in searches before making a purchase.
• And even those who do use brand names don’t start there—they start by using generic names at the outset. Only after their generic searches find some brand names do they search for brands (as they get closer to an actual purchase decision).

My experiences and anecdotal evidence certainly backs this up.

• Users are not afraid to give unknown websites a try.
• They are not afraid of the back button.
• In fact, they’ll give a site about 5 seconds to convince them it’s what they wanted.
• If it isn’t, they’ll go back to the search engine and try the next site down. It’s not cost anything.
• Actually, even if it was what they wanted, they don’t trust your website (brand or no brand), so they go back to the search engine and try the next site down anyway. Why not?

They’re not even that loyal to Google

Even Google, the one brand people will argue users are loyal to does not necessarily enjoy brand loyalty online. In a survey by Harvest Digital, the majority of people reported using Google, but notably:

• Only 24% reported that they use a single search engine.
• A full 20% said they regularly used four or more search engines.

But users do talk about online brands

One of the common counter arguments is that people DO search for brands online (if only 8% of searches), and they certainly mention only a small number websites in discussions - usually recognised brands. In fact, studies have shown that users only visit (or recall) six websites on average. Is this not brand loyalty?

Here are a few sites that have reached the masses and why I think it’s not the brand that’s driving what little loyalty they might have:

• Google - They’re loyal to the fact it is the internet - it gives results. Until it doesn’t, then they’ll try another one!
• Amazon - Can you name another place to find every book you could ever think of? (The Long Tail) And even users do go to Amazon before a search engine, they are often just researching and will then Google for the book name just in case they can find it cheaper elsewhere.
• eBay - Name a competitor. Go on, I dare you.
• MoneySavingExpert- This site is hugely popular in the UK and always gets mentioned in research. But are people actually typing in the URL or are they just on the email mailing list? Most people can’t even remember the URL - they call it ‘money saver.com’ or ‘money expert.com’ - guess what, it still comes up #1 or #2 in Google.
• TripAdvisor - The mainstream rave about TripAdvisor. But if they want to make sure their holiday hotel isn’t a hell hole, they search for the specific hotel in Google. They are more likely to click the tripadvisor link if it comes up first, and are pleased if it does, but they’ll try whatever comes up. And then they’ll go back to Google and click on the next link just to be sure.
• ASOS - Repeat purchases are not to be confused with brand loyalty. Is ASOS their first port of call to look for clothes, or are they just responding to email or magazine marketing for that particular dress they’ve been shown?
• mySpace - Are users loyal to myspace, or the significant amount of time they’ve invested in setting up their profile and gathering ‘friends’? Why are they also on facebook and bebo?
• Yahoo - Aren’t they just passing through on the way to checking their email?
• VirginMedia - Does their ISP give them any choice, or is this their homepage they can’t change?

Hyperinformed superconsumers

Wired.com thinks that whilst there are more brands than ever, they’re “taking a beating” or even worse, being ignored. They place the blame squarely at the new breed of hyperinformed superconsumers. And the web is powering it.

The importance of search engines, even if you’re building a brand

A study by iProspect found that 36% of people believe that companies whose websites are returned at the top of the search results are the top companies in their field. Just 25% said that top search engine rankings had nothing to do with market or brand leadership. But UK users, despite relying heavily on search engines as a significant source of information, don’t trust the results they get.

• Just 22% of users reported that they were confident that search engines would always give them the information that they needed.

And what’s important to them on those results pages? Brands?

• 43% of searchers said that the most important reason for clicking on a result was that it appeared on the first page
• 32% said the relevance of the description was most important
• 17% saying that a result at the top of the first page was the most important criteria.
• And just 8% said that a reputable brand name or website was important.
  

Okay, so it’s a controversial stance…

“Brand Loyalty is Dead” is a always going to be a controversial statement, and there will of course be counter arguments. BrandChannel.com posted the topic up on their site for debate, and this quote stood out for me:

“Brand loyalty is not dead, it’s just more like loyalty to a girl/boyfriend than loyalty to a husband/wife. “
- Gili on BrandChannel.com, 27-Jan-2005

What do you think?

Jeffrey Rayport of Marketspace kicked off the Online Publishers Association Forum for the Future with a presentation verging on an attempt at stand-up comedy, entitled Staying Competitive in the Digital Era. Despite the comedy, he made some fantastic points about how traditional media companies need to change their thinking, gave five strategies for success and ended by talking about amateurs acting like professionals and professionals acting like amateurs…

Rayport suggested the key to sucess is to focus on:

1. Building volume through aggregation.
2. Building margins through engagement.

The key differences between traditional and new media in the Web 2.0 world are:

• Community is the new engine of content creation.
• Social networks are the new distribution channels.
• Social intelligence is the new editorial filter.
• Tools & applications are the new editorial bundles.
• Multi-platform development is the new publishing.
• Video is the new lingua franca of online content.

Five strategies for success

1. Own the audience – overwhelm the microcosm.
   • Shock and awe with content abundance.
   • Target on
     • Location (eg xianei.com – china).
     • Interest (eg bebo.com - music).
     • Identity (eg femail.co.uk - female) .
     • Condition (eg theknot.com – getting married – used by 85% of US weddings).
2. Claim the community – ensure membership has its rewards.
   • Create communities of conviction, reward loyalties.
3. Work the web – let the outside in, and the inside out.
   • Adopt open-source thinking and leverage network effects.
   • Let the outside in: allow content from the web into your site, eg widgets, rss, etc. Why not include your competitor’s news on your site? They’ll only go back to Google to get it. Progressive insurance even shows competitor’s prices even if they beat theirs – builds trust, gives confidence, increased conversions.
   • Let the inside out: Allow syndication of your content and brand through rss, widgets, open APIs etc. Set your content free. 60% of YouTube streams are on third-party sites – let your users do your marketing for you.
4. Design for the occasion – customise interfaces for context.
   • Take the form-factor into account, eg web browser vs mobile phone
5. Integrate the experience – multi-channel, multi-platform.
   • eg Pop Idol is across TV, internet, phone, etc.

User (or pro) generated content

Rayport posulates that there are different types of ‘user generated content’ – and even different types of professionally generated content are emerging. Each piece of content may be created by a professional or an amateur, and that person may be acting like a professional or acting like an amateur.

For example:

• Amateurs acting like amateurs: Star Wars Kid and Numa Numa;
• Amateurs acting like professionals: Ask A Ninja and ZeFrank: The Show;
• Professionals acting like amateurs: lonelygirl15 and the Mentos/Diet Coke videos;
• Professionals acting like professionals: OK Go, Jeff Jarvis or Beppe Grillo.

If you build it, will they come? If you have a great product, then perhaps - but that’s no reason not to have a traffic acquisition strategy in place.

In this week’s Media Week, Richard Eyre suggests that

The mood of the web now is that if it’s good enough, people will find it and share it.

Eyre also points out that:

The perfectly logical argument goes that old media owners have the competitive advantage of cross-promotion from old media to new. But each of the brands above [Yahoo!, Google,YouTube, Skype, Craigslist, eBay] has acheived its fame with no such rich uncle to get it started.

Ironically enough, Eyre himself made that very argument - that traditional media have a competitive advantage from cross-promotion - in his column about a year ago. Perhaps things have changed - or perhaps you do still need a strategy for traffic acquisition.

Over at Scoreboard Media, they have compiled a list of 8 Simple Steps to Build Traffic For Your Internet Start-up. Of their points, my favourite is Understand the Cost of Traffic. I’m always harping on about this - but my comments are often mistaken for a dislike of paid-search. It’s not that I don’t like paid-search - I’m just not sure why you’d want to drive traffic that you won’t retain and that that costs more you’re monitising it for.  I’ll leave the full rant for another day, so here’s what Scoreboard says:

4. Understand the Cost of TrafficThis is especially important for media and E-commerce sites. You should do everything in the early days to create a large traffic data sample. You need to know what it costs to generate specific types of organic search, paid search, email, offline, direct navigation, social media, etc., traffic. It’s impossible to create an intelligent monetization or brand strategy until you know what is coming down the funnel. Then you let the math dictate how you fill the funnel. As much as I love Search, sometimes renting an email list or running a TV spot yields a better converting audience cheaper. Math will prevent you from drowning in your own Kool Aid.

1. There’s much controversy over what makes a blog, but oddly people rarely mention pings and trackbacks. So go use pingomatic and let the world know when you post.
2. Add your blog to one or all of the 36 blog search engines.
3. Ensure your posts get dugg by encouraging a digg culture.
4. Always write great headlines! Not only will goole pick them up more frequently, but you’ll increase your chances of being picked up by digg etc.
5. Publish regularly - it sounds obvious, but…
6. If you really want to get high in digg, grab attention and include the word ‘amazing’ in your headline!
7. Make use of chicklets to promte your rss feed.
8. Offer email subscriptions - not everybody has an rss reader.
9. Don’t be afraid to create list posts. They’re stunningly simply, but very effective.

Google has been dabbling with various new search result page (aka SERPS)  designs in recent months, and you may have seen new bits appearing in your searches. Many of thee were just limited trials (split testing) so didn’t appear on all searches or with all users - but some have now ‘graduated’.

One new feature which now appears to be a permament fixture was previously referred to as dissatisfied results. Google will show you three results that match your keyword, then breaks to say “See results for: xxx” and offers three results that match similar keywords, before continuing with the rest of the original results. 

It has become the subject of much debate, with many bloggers accusing Google of taking money for these new links. However Matt Cutts insists they are entirely algorithmic and are catagorically not paid for links. But it’s easy to see why they cause controversy when you see results like this:

A google search for [on demand] suggests a search for [comcast on demand] (a US cable TV provider)…

A google search for [diy shops] suggests a search for [homebase] (a UK diy store). It’s main competitor appears first in the natural results (diy.co.uk) as well as in the sponsored adwords links.

So how is Google coming up with these alternative searches? From what I’ve read and from testing I have reached the following conclusion:

1. A user does a search for [on demand]
2. They’re actually looking for comcast’s on demand service, so don’t click on any results
3. Google tracks this lack of click
4. The user decides to be more specific and searches for [comcast on demand]
5. They get the results they want, so click on a link
6. Google tracks this click
7. If enough people do this, google thinks a search for [on demand] might be intended to be for [comcast on demand]