Internet Privacy & Brand Marketing: How being too open can hurt your chances of viral success.

Posted on August 18, 2011 by teds

As the debate over internet privacy makes headlines with Facebook, Twitter, Google Plus all taking center stage around the hotly contested idea of “real identity” marketers face our own privacy battle. For us it’s not about how to open things up but rather looking at what open means for participation with our brands. Casting aside personal opinions and beliefs for the larger privacy debate, one has to realize that not all customers are willing to share all businesses – as themselves – to their own friends – in a way that can be seen forever.

Are the social tools we are using the right tools for our businesses?

Let’s start with a couple examples…

It’s Sunday afternoon and a man walks into Robins Brothers, “the world’s largest engagement ring store”. After having a great experience with the clerk and making a selection, he’s prompted to share the store by a kiosk on the door. Elated about the experience he quickly “validates” the store by liking it through Facebook. Before he makes the 5 minute drive home his soon-to-be fiancé’s friends have all posted back congratulating the two on an engagement that hasn’t happened. Whoops.

Fast forward a few days… the same man heads out with his [now] fiancé to watch a movie at the local theatre. The film is considered a “chick flick” but he likes it. After the movie, fandango asks him to post a review through his choice of social sites… all of which use his real name. Concerned from his last incident that he’ll get caught by his buddies he says nothing. Opportunity lost.

The next day the woman’s wife who works for a large corporation that was presented in the movie in a less than great way gets a call from her bosses’ boss asking about a comment she made about the brand integration on her new Twitter account. Realizing that what she had said was public, she turns off the feed from the site where she posted to Twitter.

None of these are far fetched, in fact, they’re all based on real stories that have happened and you can bet there are millions more out there. From a casual comment on a “like” of a particular brand to noting a review on a product a friend would not have expected you to buy, people are increasingly aware of the association between their lives and their postings.

While there’s inherent benefits in forcing real identity around social content like accessing someone’s friend network, or even seeming necessity, like detailed commentary, that’s a pro we’ve created without necessarily considering the impact of the con.

Thus it comes down to a decision: more content or better validation.

Luckily most brands don’t have to pick one or the other. With a host of tools it’s possible to allow both sides and with tweaking, even seemingly open tools can be made rather private. For example, Facebook’s basic like button posts right to the wall while the much richer UI share widget allows the user to select to exclude or include friends. Simple messaging to explain this may encourage a user afraid of exposure to hit share.

Give people enough choice to decide what and how while matching their own need for privacy, all while encouraging them to influence others – which accomplish your goal of creating visibility and buzz, even if it’s not quite in the way you wanted.

Calling all daily deal sites! Can I please get an offer I’m actually interested in?

Posted on February 23, 2011 by teds

Today I’m on a mission this morning, a hunt for something very illusive, something which millions of my fellow citizens are also hoping for – a daily deal I actually want to use. While Groupon, LivingSocial, and all the other standalone and integrated daily deal sites compete fiercely over membership growth and media attention for having the most impressive features and biggest deals, I can’t help but wonder what happened to a much simpler, and yet far more profitable concept – offers that people really want.

Example Offers as Seen on Groupon's San Jose Page

From the analytics I saw floating around last year it would appear that daily deal sites are hovering somewhere in the 10-15% activation rate (10-15% of sign ups have actually bought a deal) and if this is hugely understated and 35% of sign ups have activated (30MM deals sold, 29MM users, 3x deals each =35% of users ), it’s still a huge opportunity (and probably why Groupon is hiring a Director of Customer Activation with double digit growth goals – sweet job too).

Looking at data from the other side, in a recent blog post, Jeff Bussgang, cites a rumored 3-4% CVR for Groupon. As a leader in the field Groupon should have one of the higher conversion rates as they certainly have many of the top offers and a huge core of interested customers (66% read deals daily!). But unlike a traditional eTailer where a 4% conversion rate is accepted because the vast majority of the 96% remaining users are considered potential future customers (they came to your site for a reason), with daily deal sites, there’s a huge issue – relevancy – which is to say that the traffic is all coming for diverse reasons and, without relevant offers, there’s little reason for conversions to take place.

So cutting to the chase, the issue I see, and keep seeing is the range of those offers. Groupon, Living Social, Yelp Deals, Daily Steals, they can all rake in users with the same deal types (follow a few of the sites and you’ll see businesses recycling old offers as they try different audiences, fee structures) but if what they offer back doesn’t relate to the customer, they leave huge dollars on the table every single day.

Living Social Offer I'd Be Signed up for Twice -- No Wonder Why it's Featured on their Site

Take Living Social’s Amazon $20 for $10 offer that generated over a million sales. The next day my offer was for some sort of premium spa service. I just went from something I really wanted to something I had little affinity for (not knocking spa’s, I just don’t buy their services frequently). To me this is like my sister logging into Amazon and having the entire homepage be filled with table saws – not very useful in her completely managed and very new NYC apartment even if she could use one now and then.

If you look at the demographics of either of the leaders what you see is opportunity. Deals tend to be for health & beauty services, fine dining, and the monthly car wash with an occasional outlier which ranges from exotic dance lessons (demotargeted female of course) to flying lessons. Problem is it’s not just one user type: on LivingSocial (probably thanks to the Amazon deal), 40% of the users are male and on Groupon it’s still 26%. Add to the age – users are young (68% of Groupon is under 34, 36% of LivingSocial) and single (49% of Groupon, N/A by LivingSocial).

Combine these all together and what you get is a dilemma – relevancy vs frequency.

Daily Deal sites have made a promise to deliver something every single day which means rain or shine, good or bad, that offer comes and while anyone can go to the spa or eat a nice meal, the overwhelming focus of the deals are to the same demographic – female, couples, older and for the same types of services (I dare a newly dating, 24 yearold guy to pull out a Groupon code when the check comes and then suggest the same restaurant again for next week). The deal sites know this, Mashable even wrote about it last year: Groupon Eyes Further Growth with Personalized Deals; < http://mashable.com/2010/07/29/groupon-personalized-deals/> but knowing and truly solving are very different as my inbox so aptly shows this morning.

So where do we lie – with opportunity of course.

The daily deal site that gets this first stands to win a lot. Sure the offers they have now may appeal to the majority of their core audience but the majority of their core is already being marketed too left and right by competing services; the generic offer is commoditized. So the site that broads up, ropes in more sales from its younger women (Groupon is doing more and more of this as told to me by several female friends in SF), parents, guys, and even their core demographic who is still seeing many off target offers, the more they stand to capitalize on their existing investment – that giant email database each company has.

If I was sitting in a corner office of one of the independent deal sites right now I’d be pretty concerned about how to up relevancy, and not just to a few major demographic groups but real niche relevancy with offers based on interests (some of us like to read, some of us like to get shot at with paintballs) and the ability to rate ads (oil changes are only for people with cars) and some friendly user reviews (better businesses sell more) to create something like the Facebook feed, but in deal form.

After all, there are a couple competitive businesses – namely Google and Facebook who have expressed great interest in the deal category and have business rolodexes so deep it resembles the size of most company’s consumer database… If they figure it out first you can bet it won’t be hard to get a lot, an awful lot, of businesses churning out relevant offers giving consumers a lot more reason to check with them first.

To sum it all up, daily deals are clearly a huge hit and have brought in revenue at a rate that seems to be unmatched, well, ever. But in a field of competition this fierce there’s a lot of value to users in jumping ship, playing the field, and any other ‘cheating’ metaphor you can come up with. While growing the core, picking up more users and delivering to more locations are all clearly going to help these businesses propel, lifetime value is a win that trumps all other and as Amazon has shown so well, LTV comes best from having something everyone wants, and helping them get right to it time again and again and again.

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As a side note, there there’s a flip side to this for businesses outside the core of the daily deal sites – easy opportunity. While I’ve become less and less diligent about reading my daily deal emails (they all get sorted and put in a folder), an offer outside the box is going to catch the attention of a lot of people who haven’t bought recently, if at all. Perhaps that’s why my local rock climbing gym and the nearest paintball fields are such fans.

Sharing a Screen Changes Everything… The ‘Social’ iPad

Posted on April 8, 2010 by teds

In over a decade working on the web I don’t recall a single time where I used what was on my screen to influence a sale or even to really show to a friend. Sure we forward on messages for someone to see later but the actual idea of calling people over to see what you see just isn’t practical for a quick glance or ‘cool’ message.

The iPad changed that for me in less than a day. An interesting email caught my eye and I shared it with a marketing co-worker. She looked at the creative but was pulled in by the product, handed back my iPad and went online to make a purchase.

This is revolutionary.

While the iPad has been widely talked about for its ease of use, it’s quick access to the web, apps and other interface and usability features, the real game changer that I see it bringing is in sharing content. Let’s face it, few people take the time to zoom their iPhone in to a page to hand off or unplug a laptop to pass across the room. Where the personal computer is, well, personal the iPad is an open screen. This makes it ideal for collaboration – simple items are quickly passed along and whether that’s to show a new game, results from a project, or an email with an interesting product, it works.

If the experts are right and the iPad brings in a world of tablet computing (I for one see it happening) we can expect to see the term ‘social’ take on a whole new meaning as people share content in ways we may not have considered before. For web marketers this represents a whole new school of thought, design and even offers as we move to a world where what one person gets, others will often be shown. And how do you measure that?