Category: Data Marketing

Using the power of computing to draw a straighter line between a business and its customers, to the benefit of each

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Commerce sites ignore branding at their peril

Real estate on a web site is precious. That’s one reason why many e-commerce sites cram as much merchandise as possible into the home page. You can’t blame them. Shoehorn one more offer onto the page and you see sales of that item go up. But does this practice erode overall sales?

The research of Kevin Hillstrom looked at overall sales from pure selling sites (example) vs branding sites (example) vs hybrids that split the difference (example). The sites evaluated were those taken from the largest businesses represented in the Internet Top 500 retail sites.

I was most interested in how hybrid sites would fare in the study. Although these hybrid sites featured home page offers, they also used much of its real estate to reinforce the brand. White space was more common, and often these hybrid sites didn’t even require you to scroll down to take in the entire home page.

A business that regards its e-commerce site as nothing more than efficient catalog would argue that the hybrid site approach is misguided, since it is not focusing enough on specific offers. But do the numbers bear this out?

The conclusion from this study says no, although it does find weakness in a pure branding approach to the home page:

It appears likely that a hybrid strategy is most likely to maximize the net sales of each visitor to the website. Selling sites may overwhelm visitors, while branding sites may not present enough merchandise to entice consumers.

Many have preached this hybrid approach, but it’s nice to see this validation. It only stands to reason that consumers need to know two things before they buy:

  1. What are you selling?
  2. Are you to be trusted?

Raising levels of trust, through your site’s branding, is the best way to maximize sales in an environment where competitors are only a mouse click away.

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How does your email performance stack up to others in your industry?

Postfuture.com, an email service provider (ESP) owned by Harte-Hanks, has released a benchmarking tool for consumer and business-to-business emailers. One of the more useful findings is the comparative click-through rates by industry, ranked best to worst:

  • Restaurants: 57.5%
  • Publishing: 55.6%
  • Pharmaceutical: 23.8%
  • Travel and hospitality: 23.4%
  • Conference events: 14.2%
  • Financial services: 11.0%
  • Technology: 10.9%
  • Government: 9.5%
  • Insurance: 9.5%
  • Consumer packaged goods: 8.6%
  • Entertainment: 8.1%
  • Retail: 6.0%
  • Automotive: 5.7%

As you look this list over, it shouldn’t be a surprise that all of the business-to-business (b2b) emails are at the top. Business people are paid to, among other things, keep abreast of news and opportunities. The emails they opt-in to receive help them fulfill this duty.

On the other hand, consumers will be less willing to open a typical email and dig deeper with a click. Overall, emails in the b2b sector had clickthrough rates and open rates of 19.9% and 78.9% respectively, while those sent to consumers generated 11.2% clicks and 67.7% opens.

This is all according to Harte-Hanks, mind you.

As with any secondary research, you’ll want to use the figures cautiously. For instance, I suspect that the company excluded many unsuccessful campaigns from their findings, in order to sweeten the report. It is, after all, a report card of sorts.

What if this ESP was instead selling weight loss programs? I imagine we’d be seeing their customers, of all stripes, dropping the pounds to a degree that might make you concerned for their collective health. (Note: Melinda Krueger thought these figures seemed high as well. Her Comment below explains what she learned when she followed up with them).

But for the sake of comparison, these figures can help. Tempered with a degree of skepticism and your own email track record, they can show you how your enterprise compares with others in your industry, and with the medium of email marketing in general.

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Email newsletters still excel at customer retention and cross-sales

With all the recent noise about new online communication tools such as user-generated content and pushing content through RSS, we shouldn’t forget that some tried-and-true tactics aren’t going away any time soon. Take the the opt-in newsletter, particularly one that is customized to a recipient’s specific interests and tastes.

I challenge you to name an online tactic as powerful as a well-done opt-in email newsletter to draw visitors back to a web site or drive sales across a company’s complementary product offerings. This technique truly has legs.

Sure, it’s easy to see where email newsletters work in categories such as online fashion apparel and leisure travel. After all, is there anyone who hasn’t opted-in at one time or another to a travel site’s “hot deals” email?

But a truly enduring marketing tactic has the ability to surprise us – to show up and shine where we’re least expecting it. The email newsletter certainly has done this for me.

To my knowledge, one of the most effective opt-in newsletters around is in a category of services that no one ever wants to use. That category is healthcare.

Private Health News provides private labeled emails that a hospital or other care provider can use as a way to deliver news about its own offerings. What makes this newsletter so effective is the the fact that consumers truly appreciate receiving it. That’s due to theses two factors:

  • The content is customized
  • The content is trustworthy

Consumers sign up for it by visiting the site of the provider (let’s say it’s “General Hospital”), and then selecting topics of interest. This customization makes the newsletter unique to each households’ needs, with a selection of over 25 health topics from Blood Pressure to Breast Cancer, Sleep Disorders to Stroke Rehabilitation.

When the newsletter arrives, it reports the latest research, originally seen in articles from over 350 prestigious healthcare publications. The publications include the Journal of the American Medical Association and Lancet. Interspersed with the news — which, mind you, is tailored exactly to a recipient’s current health concerns and interests — are brief bulletins and ads about General Hospital events and offerings relevant to that topic.

For instance, along with a Men’s Health article there might be a notice of a free prostate cancer screening held at the hospital in three weeks, along with a link to the place on the General Hospital site where you can sign up or get more information.

I first met Dan Ansel, the president of Private Health News, six years ago at a healthcare marketing conference in San Diego. When he described his fledgling product to me, I immediately saw how this was the part of the puzzle I was struggling to deliver to my healthcare clients.

Dan’s product was a way to ensure that the valuable minority of consumers who visit my clients’ sites – and care enough about their families’ health to be proactive – can receive, every month, several excellent reasons to come back for more information. In other words, it was a way to retain prospects and patients, and to cross-sell to them wherever appropriate.

Has it worked? My experience and those of my clients says it has. What’s more, Dan has made sure to periodically survey newsletter readers, to get the user’s perspective on its effectiveness. Here are a few of the results of his latest survey, which had a sample size of 10,157 newsletter subscribers:

  • 99% consider the health information in their newsletter valuable, with 25% saying it was “very valuable”
  • 75.6% have the health issues to which they subscribe or are making decisions for loved ones with those health issues
  • Respondents are making healthcare decisions for an average of 3.3 people
  • 67% indicate a new awareness of the provider’s services as a result of receiving their newsletter
  • Over 13% have used these services because of that awareness

That last metric is the one that always blows me away. Every time the survey is conducted, more that one out of every ten people surveyed said they used a hospital’s services because of awareness they gleaned from the newsletter.

If only half of those people are telling the truth, that means over 600 individuals in this relatively small sample went to the provider of the newsletter for a possibly very profitable high ticket item, all thanks to an email newsletter.

I’ll be returning to the wonderful marketing double whammy of customization and credibility in future examples of online marketing excellence. But I’m not sure any other online technique I’ve encountered has the same high level of ROI as this surprising opt-in newsletter that sells people services they would prefer to never think about getting in the first place.

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Are you handing too much control over to search engines?

We have to stop thinking of our home pages as the main point of entry to our sites’ contents. That distinction is slowly trending toward the search results pages of major search engines. In his excellent Mine That Data!, Kevin Hillstrom reviews his own site’s traffic statistics, and then poses some questions for your business site:

Assume twenty percent of your traffic arrives via a search engine. You have essentially given control of one-fifth of your business to Google, Yahoo! and MSN. How do you feel about that? … How do you regain control of your business if that percentage significantly increases, or if the search engines decide to use an algorithm that sends less traffic to your site? Online retailers need to think hard about how much control they have ceeded [sic] to search engines. On the surface, the traffic that comes from search engines seems like it is all incremental business. I highly doubt that it is.

His point is excellent. This search traffic should not be perceived as incremental icing on the cake, unless you are quite comfortable with the idea of handing control of these visits completely over to the search engines. If you aren’t being proactive about taking strategic search engine results pages as your own (through search engine optimization), this steady flow of traffic could be diverted tomorrow to your key competitors.

The stakes can be considerable. Since search engine visits have been shown to convert more often to customers, compared to visits from other sources, losing this flow of traffic could be devastating to your business. If you don’t have a search engine optimization plan in place yet, start one now. It’s not a guarantee that you’ll be protected from the caprices of a search engine’s ever-changing algorithms, but it can reduce the risk to your bottom line.

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Is it time to add this to your privacy policy?

What with the recent AOL gaffe, where they distributed a huge data warehouse full of search data without proper anonymization, I’ve been wondering if it’s time for a few of our clients to add a clause to their privacy policy.

The clause would have to do with use of internal search data. After all, I’ve written here about the utility of mining this type of search data. These data are important markers to user behavior, and should not be ignored.

So, since consumers are realizing their search behavior is attracting attention, how about a privacy clause such as, “The owners of this site will not release user internal search data, nor will they allow it to be used to make observations about individual users. Instead, the owners pledge to use the information only in aggregate, to improve the experience of exploring this site.”

I know from looking at our clients’ web logs that privacy policies are being read over, or at least given a quick review. Therefore, this addition could help clients’ online images in the eyes of these readers, and also encourage these readers to go ahead and search within the site with confidence.

Big Brother may be watching, but he’s benevolent.