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Business marketing

Increasing a focus on internet marketing for SMB’s isn’t enough; solving the analytics equation is a big challenge

by drm on May 21, 2010

An Emarketer analysis this week of two research studies concluded that social media was going to be a big focus on web marketing expansion by small businesses.

Our experience on the ground selling our DigitalSherpa service confirms the direction of the surveys.  Once we get into a discussion about how content marketing and digital networking can help their firm, local business people quickly move past questions about “why” to questions about “how?”

NewImage.jpg

There’s a fundamental problem, though, that the research doesn’t get at.  Local businesses don’t have an interactive strategy that is geared to acquiring and converting qualified leads.

In most aspects of local business marketing, the lack of sophistication around leads acquisition and conversion isn’t that important.  But in internet marketing, it’s critical.

Take a look at the research first.  According to the “Third Annual FedEx Office Signs of the Times Small Business Survey” (that’s a mouthful), use of social media is the fastest growing tactic small business owners cite in their marketing planning.  The primary area of focus continues to be improving online presence, signaling that SMB owners consider this an area where improvement can is needed.

eMarketer then cites a Constant Contact study that shows that websites and e-mail marketing are the two most prevalent tactics or tools that SMB owners rely on to market their business.

NewImage.jpgThe high penetration of Facebook makes for an attention-getting headline, but the nuts and bolts of the marketing program are in the website and continuing contact to the prospect and customer database.

The challenge is how these SMB owners are making decisions about the effectiveness of these tactics.

It doesn’t sound hard:  track web traffic, measure leads and conversions and then select the most efficient sources.

But making these kind of analytical decisions are challenges to the largest businesses in America.  Another recent survey concluded that the biggest obstacle to effective web tracking at larger companies was finding the talent to do the analytics.  If large companies can’t get to the answer, how can small companies expect to?

In traditional marketing campaigns, these kind of analytics were not as important.   A local marketing initiative drove the consumers to one of two places:  a phone number or a physical location.  At the other end of the interaction was a real person, who would ask questions, engage and impart information.  The interaction was more discursive and exploratory, and the experience of the person representing the business in adapting answers to the knowledge and personality of the person asking was critical to driving sales.

With web marketing a primary goal of the program is to drive a person to a web site where they can get information that will inspire them to either act directly or reach out for more information.

If that web site isn’t designed the right way, then you’re not going to get the return on your investment that you should expect.

One of the things that we’ve learned in our business is that creating a web site that can drive conversions is a science, not an art.  Like any science, it requires constant experimentation and adaptation.

The challenge facing SMB’s is not just putting focus on internet marketing; it’s figuring out how to find partners who have the knowledge, expertise and interest to help them participate in a science that challenges even the largest firms.

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10 Important Questions

by drm on October 19, 2009

EDPA Access 2009 Conference and ShowcaseI’m flying out to Chicago this afternoon to sit on a panel moderated by Folio:’s Tony Silber at the Connex Live conference. The title: Big Ideas and New Opportunities for 2010 and Beyond.

The title has a positive bent, although all of us sitting on the panel have businesses with deep foundations in the print publishing world.

Tony has asked us to think about 10 key questions to prepare for the panel. Here they are:

  1. When will the industry see some recovery?
  2. What will that recovery look like?
  3. Will we see the robust health of 2005-2006?
  4. How will the business be different?
  5. Are media companies being disintermediated on the reader side through
    social media and blogs?
  6. Are media companies being disintermediated on the marketing side by
    social media and lead-gen and automated marketing software?
  7. What are the most important things media companies can do now? Org
    structure? Approach to content creation? Layoffs? Debt reduction?
  8. When we say companies need to “reset” to face new realities, does that
    mean massive losses of revenue and personnel?
  9. What will the media company of 2012 look like?
  10. What is the most important lesson of the 2007-2009 recession? How do you
    personally implement it at your company?

Those are critical questions without easy answers. For #1 and #2, the answer will be driven by the economy. When people buy things, people will make things, and people aren’t going to start buying things at a significantly increased pace until they feel confident that they will have a job making things. Gross simplification, but you can’t have a consumer economy without consumer income.

When will we see the robust health of 2005-2006 and how will the business be different are foundational questions: I don’t know and I wish that I did.

The answers to questions 5 through 9 are all loosely connected. The answer to one influences your answer to all the others. For a web-focused conversation about #5, see this summary of a dialogue on Fred Wilson’s blog. (Wilson gets about 12,000 unique visits a month to his blog.)

Media companies are in an environment where consumer have disparate tools to create and consume content. Traditional formats continue to be part of the media consumption mix, but the hegemony of format and audience, which has been eroded during the 14-year evolution of Internet-based media companies, feels like it has been permanently disrupted. The economic contraction is a catalyst, but the widespread adoption of social media tools, which require minimal technical expertise to implement and consumer, is a more basic change to the foundation of our businesses.

This change requires companies to answer very basic questions:

  • What is my market? What are the ways that I can take product to market, build audience and, in the case of marketing-based businesses, leverage the audience for the benefit of my clients?
  • What, if anything, can I charge for each aspect of my market strategy, including new and traditional channels?
  • How much revenue can I create from this business mix?
  • In order to generate 15% to 25% cash flow, after operating expenses, from this business, how much can I spend in expense?
  • What level of debt can this new business model sustain?

Once you have a realistic set of answers to these questions, then you can shape the answers to questions #7 and #8. And the outcome of those answers gives you a picture of what your traditional media company might look like in 2012. (Of course, it doesn’t capture the picture of the emergent media company of 2012….)

The last question was thought-provoking. I’ve learned a lot over the past few years. The most powerful thing I have witnessed is the practical desire in most people to do the right thing, to arrive at a logical conclusion. I’ve seen people struggling to find answers, bewildered by the whirlwind of change they have experienced, but intensely focused on finding ways to adapt themselves and their business strategies to the realities. As the pace of change slows, and people are able to organize themselves around more stable markets, I’m willing to bet on their ability to find new, effective ways to build their businesses.

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