Entries categorized as ‘eBiz Management’
Det har inte undgått någon att sökordsmarknadsföringen eller “Search Engine Marketing” tagit stor andel av marknadsbudgettar och onlinebudgettar senaste åren. Enligt den senaste mediabyråbarometern (18/5-2010) växte sökinvesteringen med +27% årsvis.
Källa: Mediabarometern maj 2010
Växten drivs huvudsakligen av omfördelning av budgettar till online och onlineförsäljning (inte tillväxt i ekonomin). Det rör sig främst om offline budgettar som läggs till sökkanalen.
Historiskt har affiliatenätverken arbetat med många olika typer av affiliates eller publishers. Som exempel kan affiliates ha inriktningarna meta/ prisjämförelsesiter, bloggar och aggregatorer.
En typ av affiliate som tagit en viktig position i affiliatenätverken har varit sökordsaffiliates – alltså affiliates som istället för att ha en stark site närvaro fokuserar på att driva efterfrågan genom budgivning på sökord och sedan vidare till landningssidor som pekar på annonsörens varor och tjänster. Svenska Keybroker och brittiska Netmediaplanet är exempel på två sökordsmarknadsföringsföretag som har startats och/ eller växt genom att vara sökordsaffiliates.
Genom att sökordsmarknaden tagit fart och flera företag fått upp ögonen för kanalen har också konkurrens ökat. Därmed har sökordsaffären renodlats. De flesta mediabyråer har satt upp dotterbolag som aktivt managerar egna kunder sökbudgettar. Sökordsmarknadsföring är idag ett verktyg som är minst lika viktigt för varumärkesvårt och PR som det är för direktförsäljning och avslut.
Med det har också antalet kunder som tillåter sökordsaffiliates minskat. Även Google har i t ex fallet Netmediaplanet straffat företeelsen med sökordsaffiliates eftersom relevansen för den som söker anses vara mindre (sökordsaffiliaten ses som en onödig mellanhand).
Utvecklingen har fått en tydlig påverkan på affiliatenätverken som haft en inte oviktig del av omsättningen genom sökordaffiliates. Denna utveckling har varit särskilt tydlig under 2009 där flera stora kunder “plockar hem” sökaffären och managerar den själva. Eftersom sök utgör en viktig källa för försäljning så märks det också för affiliatenätverken.
På sikt är det sunt att sökordsmarknadsföringen behandlas för sig och ses som en egen kanal. I vissa fall kan sökordsaffiliates fortfarande utgöra ett bra komplement (expertis, småmarknader med egna språk, kostnad för att managera).
Implikationen för affiliatenätverken är att de är sårbara även fortsättningsvis om de har en stor andel sökordsaffiliates och inte kan erbjuda sökordsmarknadsföringstjänster.
Categories: eBiz Affiliation · eBiz Big Picture · eBiz Demand Generation · eBiz Management · eBiz News and Trends · eBiz Strategy
Tagged: Sökordsaffiliates, Affiliatemarknaden 2009, Sökordsmarknadsföring ett viktigt komplement till affiliatenätverken, Rätt kanaler
Förutom rena varumärkes/ awareness drivande annonsering i displayform har onlinemarknadsföringens hjärta fokuserat på försäljningar och avslut mot konsumentmarknaden. Det har drivits av ökad spårbarhet och data på användarnas aktivitet före och efter exponering av ett reklambudskap. Mest utveckling har skett på de områden där själva köpet eller aktiviteten utförs online t ex genom distributionsformer som affiliate.
Image Source: www.inmoba.com
Ren display/ banner annonsering lider av ökad ineffektivitet (lägre klickfrekvens/ CTR) i takt med att utbudet av siter och reklambudskap ökar. Därmed ökar vikten av att öka “håvens” storlek i onlineportföljen. Idag är det lämpligt att komplettera displayannonsering med en tydlig sökstrategi, ett affiliateprogram och inte minst leadsgenereringsaktiviteter. Med leads avses t ex emailadress, ifyllt kontaktformulär, sign-up på nyhetsbrev osv.
Det finns ett antal stora aktörer på leadsmarknaden. De flesta arbetar med emaildatabaser och fokuserar på inhämtning, sortering och försäljning av emailadresser. Huvudverktyget för insamling av kontaktuppgifter/email är genom intresse- och frågeformulär. Förutom TradeDoubler finns det aktörer som Come&Stay som växer snabbt på området.
Fördelarna med leadsprodukten är många och här nämns några:
- Bättre effektivitet genom att i ett första skede skapa ett frågeformulär och segmentera användare innan man sänder ett reklambudskap. Därigenom får man också opt-in.
- Själva insamlingsprocessen kan göras till en relativt billig peng i annonsnätverk – genom tävlingar och annat kan en positiv upplevelse kring frågeformuläret skapas.
- Konverteringsfrekvens och effektiviteten på resultatet, de sorterade emailadresserna, är ofta mycket hög.
- Denna produkt är utmärkt att använda för B2B affärer och affärer som kräver mer försäljning/ övertygelse innan en transaktion kan äga rum – eller rent utav köp som görs offline men som initieras online.
Leadsprodukten växer kraftigt idag och bör vara ett självklart komplement i alla effektiva onlineportföljer. Den kan också delvis ersätta dålig intern hantering/CRM system av kontaktuppgifter i företagen.
Categories: eBiz Big Picture · eBiz Channel Conflict · eBiz Demand Generation · eBiz Management · eBiz News and Trends
Tagged: Leadsgenerering online - en kioskvältare., Komplettera onlineportföljen med leadsgenerering., Effektiva emailstrategier - det går att starta från 0., Driv mer volym online genom intresseformulär., Förbättra ROI i onlinekanalen med leadsgenerering.
I och med att Microsoft (Microsoft Media Network) tar en tydlig position inom nätverksannonsering och TradeDoubler Sverige i sitt senaste nyhetsbrev har offentliggjort fördjupade samarbeten med Bonniergruppens ledande siter så finns nu tre stora annonsnätverk i Sverige: TradeDoubler, Microsoft och Schibsted.
Nätverken erbjuder olika lösningar och prisnivå men sammantaget kan man se några tydliga trender i utvecklingen:
- Fler och fler nätverk börjar kunna erbjuda sofistikerad trafikstyrning för att öka klickfrekvens och effektivitet (geografisk, interest-based/behavioural, re-targetting och vertikaler) .
- De stora mediehusen som inte är organiserade i nätverk tvingas in eftersom egen säljstyrka och säljbolag inte får access till budgettar som är avsedda för nätverk – och dessa ökar.
- Mediebyråerna tar till sig nätverksannonsering i större omfattning – ofta drivet av annonsörernas befintliga sammarbeten och ROI krav.
- Farhågor kring varumärkes exponering på “fulsiter” mm blir mindre och nätverken blir bättre på att kontrollera kontext.
Det här är en fortsättning på den konsolidering som länge förutspåtts. Även om den i det kortare perspektivet innebär ökad konkurrens är den underliggande växten och flödena till online/ osålt/ annonsnätverk så stort att samtliga spelare kan växa mer än annonsmarknaden i övrigt under några år framöver.
Categories: eBiz Big Picture · eBiz Demand Generation · eBiz Management · eBiz News and Trends
Tagged: Annonsnätverken i Sverige genomgår ytterligare konsolidering., Bonnier ansluter sina siter till annonsnätverk., Bonniers ledande siter ökar aktiviteter på osålt., Microsoft och TradeDoubler ökar annonsnätverksaktiviteter., Schibsteds Webtraffic får ökad konkurrens.
Since Google removed the Best Practice Funding program in 2007/2008 (its latest media agency kick back scheme involving 3-8% of ad spend money back) most search engine marketers are looking at gross margin from Search Engine Marketing of 8%-15% of spend (excluding consulting or fixed revenues). In a highly competitive market a search engine marketing firm has to be exceptionally capable to exceed gross margins of 15% on core transactions.
Naturally, this suggests that Search Engine Marketing is a volume game. Much like a media agency model it is all about achieving critical mass or break even volume to achieve high return on invested capital.
Although fast growth and redirection of offline budgets into online is driving search spend in general, there is one specific characteristic of search engine marketing (and especially search engine optimization) that creates issues, namely scalability. Or should I say lack of scalability.
Our colleagues at Google figured out a long time ago that a middle man is necessary if Google is to preserve a highly scalable and profitable business model. The middle man – in this case the search engine marketing firm – would deal with the time consumable, non programmable issues such as client meetings, multi language translation, client education and creative management of an effective key word strategy.
The lack of scalability equals cost. For every dollar spent in search engine marketing there is a marginal increase of the work needed. Of course large accounts tend to scale with size, but again many key word strategies for blue chips can involve hundreds of thousands of key words.
If I take a quick look in my market – Sweden – there are approx 6-10 dominant competitors. Most of them are running businesses that are not profitable. A qualified guess would be that a stand-alone Search Engine Marketing play needs at least 10-15 million euro of search spend before seeing black numbers on the bottom line. Few companies can and will achieve that kind of revenue given the competition so consolidation, especially with other online marketing product areas, is to be expected over the coming years.
Categories: eBiz Big Picture · eBiz Demand Generation · eBiz Management · eBiz Strategy
Tagged: Consolidation to be expected in search engine marketing industry., Google makes it difficult for pure play search engine marketing players to survive., Search Engine Marketing firms need to diversify to survive., Search Engine Marketing Gross Margins are low., Search Engine Marketing not profitable.
More and more often I come across companies that are trying to build ad network exchanges. They come from all parts of the world. Some of them are technology based but many are led by former ad network guys who are running with a new business idea.
Typically, these market entrants will address big publishers with the mother of all business propositions: “we will deliver constant money making peaks to your site”. Or even better: “we will optimize your eCPM at all times”.
In theory, the model is a good one and works in most free markets. The unique selling point is spelt liquidity. By plugging in the biggest advertisers in one exchange, publishers can benefit from a constant flow of ad placements to which they can deliver abundant traffic. The exchanges will typically address the biggest online advertisers and the biggest online ad networks to source traffic to their systems.
There are however two major problems that new entrants and exchanges face. Firstly, incumbent ad networks are in fact aspiring to be exchanges in most cases. The ad network business model i.e. making a percentage off transactions is identical to the exchange model where there is always an overall objective to optimize traffic and money making opportunities for publishers.
Secondly, incumbent ad networks are already the middle man and functioning as a market maker. By adding another middle man, incumbent networks become obsolete in so far as they lose their raison d’être and constitute one out of two layers between an advertiser and a publisher. That is one too many.
Bottom line is that most exchange entrants will find that incumbent adnetworks lock them out immediately out of fear of competition. Few exchanges will last without traffic and liquidity (publishers who bought in will quickly move on) more than a month. This is already happening every day.
As a result, we are seeing some aggressive exchange entrants acquire publishers that are not making money (typically old publishers that experience little growth and low profitability). The publishers’ traffic alone is worth little. But as a component in an exchange effort it is worth much more.
Question is – are ad network exchanges just ad networks with new technology?
Categories: eBiz Big Picture · eBiz Demand Generation · eBiz International · eBiz Management · eBiz News and Trends · eBiz Organizations
Tagged: Ad network exchange entrants face difficulties., Ad network or ad network exchange?, Online marketing networks and exchanges., Protective actions from incumbent ad networks., The ad network exchange model.
With some recent stats from one of Sweden’s largest ad networks in my hand for the month of June, July and August, some key trends are clear:
- Clicks are up 5-10% year on year (YoY).
- Click through rates (CTR) are down dramatically YoY. in some programmes and sectors as much as 50-60%.
- Site conversion overall for ecommerce plays is stable or slightly up (0-10%).
Overall it looks like the financial crisis is hurting CTR. Net-net the CTR as is having an adverse effect on total sales suggesting a -10 to -20% drop in total conversion of ecommerce programmes.
Categories: eBiz Big Picture · eBiz Demand Generation · eBiz Management · eBiz News and Trends
Tagged: ecommerce summer 2009, ehandeln ner under sommaren., ehandelsutveckling sommaren 2009, Finanskrisen slår mot viss ehandel., Nedgång i konvertering jämfört med förra året.
Any effective ROI assessment of online demand generation needs to be based on some form of tracking. The preferred method for understanding where the originating customer of a sale was exposed to the marketing message/ creative is the “cookie” i.e. a small text file sent via the browser to the computer at the place of exposure. When the sale is registered the cookie will provide the origination information to the tracking host/ affiliate network provider for accounting purposes.
In affiliate programmes, the key is to understand to what degree a given affiliate can be credited for a sale (I will for the sake of simplicity disregard the problems surrounding multiple origination points before a sale). Today, some affiliate networks do not make any distinction between a so called “click through” sale (the click being a definite link from the site of exposure to the point of sale) and a so called “view through” sale (the cookie has been received by inactive “viewing” i.e. visiting a big news site would be enough to actually be exposed to the cookie, the customer sometimes not even seeing the marketing message itself).
Whereas the click through method is relatively clean, the view through method is controversial for a number of reasons. Many of them should be of the greatest importance for any online marketer.
- There is a weaker link between the sale and the exposure hence one could and should question whether the sale really should be attributed to the view through point of exposure.
- This means that the cost per sale will look good – many more sales at a predefined payout level. Nevertheless, there will be false attribution of sale origination. The marketer/advertiser will think that what should be attributed to TV, radio, banner advertising or simply base demand is originating from an affiliate programme. The advertiser will pay twice for the same sale.
- Affiliate networks that do not clearly separate the two in data reports to customers are in my view not playing fair vis-a-vis the advertiser.
- Affiliates will be inclined to join programmes and affiliate networks where view through sales are highly or equally rewarded to click through sales because they will make more money with less quality effort/ traffic.
- Affiliate networks that do not up front separate the two methods often refrain from doing so because they lack tracking technology to separate the two methods and hence offer the same payout for two very different levels of interaction from the customer.
Don’t use affiliate networks that don’t tell you upfront how they manage and attribute view through vs. click through. It will cost you dearly even if your cost per sale and volumes look great.
Categories: Web Analytics · eBiz Affiliation · eBiz Demand Generation · eBiz Management
Tagged: Accounting for performance in affiliate programmes., Don't pay twice for the same sale., How affiliate performance is credited., iSales vs. Sales., Marketing ROI on affiliate programmes., Online sale attribution conflict., Pitfalls in affiliate marketing., ROI misrepresentation.
It seems more and more advertisers are choosing so called closed keyword policies i.e. they choose not to work with specialized affiliates that employ search engine marketing (SEM) tactics to drive traffic and make money on the difference between cost per click bids and cost per order rewards.
In many markets, savvy keyword affiliates can still make nice profits. However, as marketing departments adopt a proper search strategy and acquire relevant know how, many affiliates that previously delivered search originating traffic through an affiliate programme are sacked. In the short term, they can focus on other programmes and activities. In the long term, we are seeing a migration of affiliate revenues into search. For the affiliate market it is hardly bad news. A short term loss in revenue will be replaced by true affiliate revenues as digital marketing spend grows.
The beauty of true affiliate programmes lies in a common interest in the consumer between an advertiser and an affiliate. Without a relevance between affiliate traffic and advertiser products, the model won’t generate enough return. Affiliate programmes take long time to build (not only technical tracking) and need a lot of tweaking before they can be deemed successful.
So as both demand channels continue to grow, affiliates will become more clean cut. All good.
Categories: eBiz Globalization · eBiz Management · eBiz Strategy
Tagged: Keyword policies changed as advertisers take over search., Advertiser search know how changing online demand playing field., Affiliate programmes see less search mix., Search affiliates in trouble?
My colleague Åsa Lundell at TradeDoubler, www.tradedoubler.com and www.digipedia.se, showed me some very interesting research on transaction volumes online. The research clearly highlights how average order values (AOVs) are trending down year to date.
What is even more interesting is that the order volumes themselves are not trending down. The number of orders are probably driven by a variety of factors e.g. growth of online users and migration of offline campaigns.
On the other hand, average order values are hit by:
- Purchase patterns amid recession – people have less money and look for bargains and cannot fully afford high end products.
- Increased efficiency in online tracking – the more orders we track as a percentage of total – the greater the number of orders and the lower the average order value.
- Possibility that high AOV ecommerce items (durabels etc) are suffering more than e.g. fast moving consumer goods i.e. mix is shifting to lowend AOV.
Categories: Web Analytics · eBiz Affiliation · eBiz Demand Generation · eBiz Globalization · eBiz International · eBiz Management
Tagged: Average order values online hit by recession., Drivers of lower average order value online., Ecommerce slowing - driven by lower average order values.
For most people, trading equals buying low and selling high. Typical traders will run there own stock or inventory and look for quick in and outs in any given market place.
In financial markets arbitrage is the practice of taking advantage of a price differential between two or more markets: striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices (Wikipedia definition). My appreciation of the term arbitrage also includes the notion of the capitalization being “risk free” i.e. the practice described above is done simultaneously such that no risk is incurred.
My colleague Jonas Rundgren brought my attention the other day to the emerging practice of “arbitrage” in the online advertising space. Impressions, clicks and actions are referred to as “currencies” and the arbitrage lies in capitalizing on the imbalance in conversion rates between cost per impression, cost per click and cost per action.
For example, if you know a historic conversion rate of impressions of financial services to clicks of financial services you can start trading when an imbalance occurs.
Let us assume that the market cost per thousand impressions (CPM) for relevant publishers/ site owners is 2€. Let’s say the standard historic conversion rate of financial services is 1%. This would mean that a thousand impressions would give you 10 clicks. In a balanced market, the financial services cost per click (CPC) should be 100x the cost per thousand impressions (CPM) i.e. 200€. If this is not the case there is an arbitrage opportunity.
Publishers (site owners) will be more or less willing to settle for anything else than CPM deals. Let us assume they are indifferent. Opportunities in this case will arise from assymetric knowledge about conversion rates (historical data, publisher data, assessment of offering in question, seasonality). Assuming that the CPM and CPC prices are constant, a higher than average click through rate will allow market makers to buy CPM and sell CPC making a margin off the imbalance. A lower than expected conversion rate will allow market makers to sell in CPM and buy in CPC, again making a margin off the imbalance. A real opportunity, in real dollars, occuring every day.
Some maybe sceptical as to the real value in understanding this? But seeing that impressions, clicks and actions are the new currencies of the next century, with trillions of CPC, CPM and CPA transactions every day, there is a tremendous amount of money to be made in trading them. Only issue is that few players on the market have the adequate data to do it successfuly. And those that do hardly have the competency to understand how to manage risks and structure a trading outfit.
Categories: eBiz Globalization · eBiz International · eBiz Management · eBiz News and Trends · eBiz Organizations · eBiz Strategy
Tagged: Online advertising arbitrage., Online market making., CPC, CPM and CPA as traded currencies.
