Stephen E. Arnold

Wednesday, 06 July 2011 10:30

Can AOL cook up a winner with Patch?

In the last two years, AOL has become a target for criticism of its acquisition strategy. AOL purchased the controversial niche news service TechCrunch and then bought the even more controversial Huffington Post, making its founder Arianna Huffington, the editorial chief of AOL’s burgeoning online content operation.

One wit said, “AOL’s is changing its familiar ‘You’ve got mail’ to ‘You’ve got problems.’”

Despite the slings and arrows of financial television show hosts, AOL may have a trick up its sleeve. The company could, according to Auctionbytes, use its content to increase its share of the burgeoning market for online advertising.

The company acquired a local news and information company called Patch in June 2009, a company founded by Tim Armstrong. Armstrong was the president of AOL at the time of the acquisition, which means that Patch was important to the long-term content strategy of the floundering AOL. At the time of the acquisition, I assumed that Armstrong was negotiating the deal. In “Back to the Future,” AllThingsD.com reported that Armstrong allegedly told AOL staff that he would not make a profit on his stake in Patch. At about the same time, AOL bought Going, which was a social networking company.

News is circulating via blog stories like “AOL’s Patch, AmEx Targets Groupon with Patch Deals." The idea is that AOL wants to be a player in the local online advertising market. What makes the AOL rumors interesting is that unlike some of the companies competing in this sector, AOL has local content, a social networking technology, millions of users and a number of high traffic websites that can generate buzz about AOL’s products and services. A Web watching blog, WebProNews.com said, “AOL Launches Patch Deals…Yes, Another Deals Service.” The blog crept out on a limb and said that the service would be a Groupon clone. The roll out is slated to take place in the fall of 2011.

First, what is Patch? The service is a bit like the local newspaper. Unlike the print publications that are created to serve a narrow geographic region, Patch describes itself as “hyperlocal news.” With most major newspapers chasing big stories and recycling content from various services and syndicates, information about the local soccer club tryouts and the junior college play schedule are difficult, even impossible to find. Google indexes billions of pages, but the search system does not make it easy for me to find out when the Montgomery County Seneca Valley High School book sale will be held this year.

Patch captures news and information from small cities. The goal in 2010 was to cover 500 U.S. cities. The company uses paid staff and has a “foundation” to help “improve the quality of life in underserved communities across the globe and through access to trusted local news and information.” One of the advisors to AOL Patch is Jeff Jarvis, a college professor and expert on Google. He complements a full lineup of professionals.

The one issue that I have is that I have not encountered anyone who uses Patch. In a recent story of local online advertising, the sample included in our research did not mention Patch a single time. AOL has a formidable marketing machine, but in the noise about local advertising, local search and local maps, AOL’s voice is not being heard.

There is a website, quite a fancy one in my opinion. Navigate to Patch.com. You will see a list of states in which the local information service operates. I am writing this column for a company based in Cleveland, Ohio. According to the map of Patch coverage, Ohio is one of the states the service covers. Kentucky is not so lucky. Neither is Texas, Indiana, Oregon and two dozen others.

The cities Patch “covers” in Ohio are Avon Lake, Avon, Beachwood, Brecksville, Cleveland Heights, Cuyahoga Falls, Fairlawn-Bath, Hillcrest, Kent, Lakewood, Mentor, North Canton, Solon, Stow, Strongsville, Twinsburg and Westlake.

If we dive into a community with which I have some familiarity, Cuyahoga Falls is among the more affluent cities within commuting distance of Cleveland and the now shuttered marine park. A click on the Cuyahoga Falls Patch link displays news about a ceramics program for those 60 and up, a “Mid Day Serenity” event at the Paradise Club and ballroom dance lessons at 6:30 p.m.

The content seems to be a blend of bylined stories; for example, the “Q&A with Woodridge Graduate Jessie Greene-Hill” was written by Alanna Klapp, who is a freelance writer.

For a merchant in Cuyahoga Falls, the opportunity to put a message in front of Patch information consumers in Cuyahoga Falls makes perfect sense. There is one big challenge — traffic. Small communities will have smaller populations. Cuyahoga Falls is a reasonably affluent community, so one would expect that most households would have a computer and a good percentage Internet access. Smartphone penetration would also be higher than the phone penetration in Harrod’s Creek, Kentucky, by way of comparison.

However, when I checked Patch traffic on the Compete.com service, Groupon was in the 29 million unique range, LivingSocial was 14 million, and Patch.com was 5.5 million. Compete reports that traffic for Cuyahoga Falls Patch is climbing, hitting 8,000 unique visitors in April 2011 up from about 700 uniques in December 2010. The growth of the service is excellent, especially at a time when many websites have been adversely affected by Google’s anti-spam activities called Panda.

Details about Patch Local are sketchy. Some broad outlines of the service may be discerned in the information leaks surfacing in the Internet media.

Patch wants a piece of the advertising revenue in certain cities. Like Cuyahoga Falls, Patch wants to capture some of the advertising dollars flowing to hard copy newspapers service cities like New Canaan, Connecticut. In the city, BNet reported that there is New Canaan Patch, the New Canaan Advertiser, and a weekly Hearst paper, New Canaan News. Patch, not surprisingly has the AOL.com online brand and a staff of Twitter savvy professionals plus and a motivated president, Tim Armstrong, a former Google executive.

Patch’s angle may be a lower cost, lower risk alternative to Groupon. After fees, merchants using Groupon have to cover the customers from what is 25 to 30 percent of the regular price of the product or service. Groupon has been attracting some negative feedback when a poorly conceived coupon promotion creates a money losing situation for an advertiser. Patch and its partner American Express may pursue small businesses with combination offers. A joint promotion to American Express card holders and the AOL online user community could be an angle that puts traditional media and newcomers like TryItLocal.com under pressure. A price war could make online local advertiser a bargain for merchants who have an appetite for new media marketing.

AOL has played a role in online communities since its inception. I recall attending a conference at which AOL and CompuServe executives discussed the vibrancy of forums and discussion groups. The Facebook DNA, in my opinion, can trace its heritage to the early and largely unmoderated forums on these early online services. Unlike companies that talk social like Groupon and LivingSocial, AOL has deep social technology roots and quite a bit of experience in leveraging its customer base.

The Patch Deals FAQ provides additional early stage details about the forthcoming AOL service. Keep in mind that with a release date months in the future, the exact shape of the service at launch can change significantly. AOL Patch’s key differentiator is that advertisers will not have to make an upfront payment, obviously an alternative to the Groupon method of getting the merchant to pay upfront fees. AOL makes clear that it will promote the service “a couple of different ways: “via e-mail, through Patch’s daily and weekly newsletters, and thorough social media such as Facebook and Twitter.”

When Patch becomes available, should a local business consider advertising on the service? Will Patch pose a challenge to local newspapers and information services from bloggers and commercial publishing operations? Will Patch be able to carve out a profitable niche in a very crowded sector?

These questions are difficult to answer. AOL needs a revenue win, and it may have the right combination of ingredients: A dash of Huff-Po, a chunk of Patch, and a smidgen of AOL. Might be a Top Chef recipe.

Stephen E. Arnold is a consultant. More information about his practice is available at www.arnoldit.com and in his blog at www.arnoldit.com/wordpress. His most recent book is The New Landscape of Enterprise Search. For information, visit http://arnoldit.com/wordpress/landscape/.

Tuesday, 31 May 2011 21:01

When with-it marketing won’t work

I broke my foot. No airplanes until July 1, 2011. For the first time in 25 years, I have had time to attend local business networking events. The one held the first week of May nearly knocked me off my crutches.

I live near Louisville, Ky., and my orthopedic surgeon gave me the thumbs up for riding in an automobile and attending meetings at which I could sit. I poked my nose into some Chamber of Commerce events. In Louisville, the fuddy duddy “chamber” name has been abandoned for the more sporty Greater Louisville Inc. or GLI, http://www.greaterlouisville.com/GLI/.

Business First, a local business newspaper, publishes a calendar of local networking events. Among the lineup is “The Power of Digital,” “CFO of the Year” and “Wake Up and Wind Down.” There is a group called Rainmakers, which is a business development system “designed to help you grow your business through strategic relationships.” This is the tip of the iceberg.

You can locate local business networking events. Resources range from running a query on Bing.com or Google.com to visiting special purpose sites. You may come across sites that exist only to deliver mostly vapid information. I explored BizLinks and learned that it was completely wide of the relevancy mark. If you live in Boronia, however, the directory might be useful to you. http://boroniamall.topcities.com/Business Scene, for example, bills itself as “the business and events directory.” My checks revealed that the service works quite well in large cities in the United Kingdom but is of little use to me.

After quite a bit of clicking and scanning, I located In Company at www.incompany.com. The service is “a business and social network, business directory, and online marketplace rolled into one.” Unfortunately, my search for “printing” in Louisville, Ky., returned zero hits.

What this taught me was that learning about local business networking events will require good, old-fashioned networking. There is no online resource that did a comprehensive job of informing me about the St. Matthews Area Business Association, www.smaba.org.

If you are looking for a new online information service to create, you may want to take a closer look at this empty niche.

At the local event, I listened to a program focused on marketing for small businesses. The panel consisted of a local advertising agency and two small business owners. I did not expect to hear that Fancy Dan, online, social marketing was not useful to these two businesses. The message was reinforced by the local agency’s representative who said, and I am pretty sure I have this correct, “The old ways of marketing a small business are working, cost-effective and less hassle than the new services like Groupon and LivingSocial. As you may know, both of these websites allow a business to craft a special offer. The websites get money upfront and then make the deal available on a localized website. The deal is pushed out via e-mail, and the merchant can slap a sticker on this front door reminding customers about the deal.

But what I heard was almost the exact opposite. These small businesses and one local agency suggested cable TV ads, printed coupons distributed at various locations, radio spots, ads in the local printed newspapers and tabloids, and other nondigital channels were the way to go. The surprise marketing method that worked for one business on the panel? Billboards. The thump you heard is my falling off my crutches. My firsthand discovery supports the Ad Age report “Affluency: Being Technology Infused Proves Taxing for Affluent.” Small businesses may not be “affluent” in Ad Age’s sense of the word, but the strong interest in traditional marketing may be a signal that the digital revolution is not working in every sector as anticipated.

The second surprise was that in the Q&A session, a couple of attendees rattled their handcuffs. Because of the terms of these firm’s franchise agreements or reseller licenses, the local company was not permitted to use social media, run a blog about the business or send out business-related tweets. These types of activities were handled by corporate. A violation could result in the licensee getting slapped in leg irons or losing the tie up with the larger firm. Not surprisingly, the idea of tweeting to existing customers was dismissed.

The third surprise was the sophistication of those on the panel. A company with a younger boss was more interested in social media marketing than more senior small business owners. The shocker was that speakers and those in the Q&A session were aware that the demographics of their customers were key indicators. To summarize the comments: a company with customers under 25 were more active with social media, online marketing, and the like. The small businesses with gray-haired customers skipped the “with it” methods.

After thinking about the session, I formulated several hypotheses about marketing in our digital world in general and, more specifically, in a local market. The major take away for me is that finding local business networking events is more difficult than it looks at first glance. I assumed that the city government, our local university’s business school or a local business service group like the Kiwanis group would have provided this information. I was wrong. When I looked at the Kiwanis International website, Kiwanis promotes its own events. Understandable but oddly narrow.

The first thought is that newspapers, radio stations and cable television companies with local access programming have an opportunity to grow their business. For several years, I have been shaped by information about the limited horizons of traditional marketing methods. If the information gleaned from this sales and marketing panel is anywhere near correct, there are growth opportunities. Perhaps I am unable to see the problems of closing a sale to a local pizza restaurant. On the other hand, the owner of the pizza parlor is looking for ways to get specific messages in front of those who want pizza. The question that struck me was, “Why are the traditional sales and marketing channels tapping this market?” I am not sure what I am missing.

The second idea I contemplated is that franchising companies and firms working with partners in a local market may be creating a problem. Young franchises and partners understand and want to use traditional and “with it” marketing methods. Unless these licensees and resellers get the green light from corporate, the franchiser and corporate big daddy may have a revolt on their hands. The sense I picked up from the Q&A session was that restricting or prohibiting certain types of marketing was planting the seeds of a revolt. A franchise operation needs new franchisees. If a younger franchisee departs, the franchiser takes a financial hit. In some cases, the former partner may become a competitor, which is an equally undesirable consequence.

The third notion I had was those on the younger slope of the customer demographic divide wanted “with it” marketing. Looking at a company’s Facebook page or Yelp “rating” were part of these prospects’ and customers’ equipment for living. Learning about a lunch special via a tweet or a Web page was a natural way to keep tabs on money saving ideas. The merchants serving the silver side of the demographic divide were focusing on more traditional marketing methods. The number of companies striking the right balance seems small. Common sense suggests that taking a “middle way” is a sound business strategy.

What can a business do with this type of information? (I am assuming that what I learned at the local business networking function may surface at a meet up near you.)

First, assess your current marketing plans. If you are getting the sales results you want, stick with your program. If there are diminishing returns, a change is needed. Stated another way, “with it” marketing and traditional marketing have to be tailored to your specific products, market, and budget.

Second, accept that a basic website may never get a large volume of traffic. If your website is mostly static and predominantly marketing type information, you do not have to invest big dollars in hopes of getting a spike in sales. The customers are under pressure and looking for information about products and services that deliver a value. A website or a Facebook page may be sufficient for some businesses. For others, traditional sales and marketing delivers sales.

Third, monitor your prospects and customers. If you see a demographic shift, you will have to make a midcourse correction in the sales and marketing plans. Even traditional businesses can experience a customer shift. One example is the surge in interest in healthy eating. Restaurants attracting a younger clientele will have to look at “with it” marketing methods and retain channels that reach the over 40 demographic with an interest in organic, vegetarian or healthy consumption. Sudden shifts can and do happen. Agility is needed in today’s tough business climate.

Stephen E. Arnold is a consultant. More information about his practice is available at www.arnoldit.com and in his Web log at www.arnoldit.com/wordpress. His most recent book is The New Landscape of Enterprise Search. For information, point your browser at http://arnoldit.com/wordpress/landscape/

Monday, 28 February 2011 15:07

Stephen E. Arnold

In September 2010, Google changed the way search results appeared. The new version, dubbed Google Instant, displays search results as the user types a query. In the old version of Google, the system displayed query suggestions in a drop-down box. Now the screen fills with search results.If you have not tried the new “search as you type” system, navigate to Google and enter a query. I tested the query for American Airlines, which I typically abbreviate to “aa.” Google displays AAA Official Site. The Triple A is the American Automobile Association. How do I get American Airlines? The solution is to enter the full query “American Airlines,” not the abbreviation “aa.” If you want to change your default Google settings, you can click on different links until you find the page that allows you to turn off Google Instant.

Most users just use the default settings. The result is that finding websites or information now requires some extra work. Granted, if you are looking for the American Automobile Association, Google Instant is a great benefit. But if you are looking for any other entry that includes a double “a,” you are going to be affected by Google Instant.

What’s behind this type of radical change to Google’s main search system? According to Google, “We are pushing the limits of our technology and infrastructure to help you get better search results, faster. Our key technical insight was that people type slowly, but read quickly, typically taking 300 milliseconds between keystrokes, but only 30 milliseconds (a tenth of the time!) to glance at another part of the page. This means that you can scan a results page while you type.” (Source:http://www.google.com/instant/).

Google continues:

The most obvious change is that you get to the right content much faster than before because you don’t have to finish typing your full search term or even press, “search.” Another shift is that seeing results as you type helps you formulate a better search term by providing instant feedback. You can now adapt your search on the fly until the results match exactly what you want. In time, we may wonder how search ever worked in any other way.

If American Airlines is affected by Google Instant, what about a smaller business? My testing reveals that Google appears to be focusing search results, particularly the first two or three letters, on larger firms. I did some spot-checking and could not discern a specific pattern. My conclusion was that a Google numerical recipe was looking at what the user typed and then consulting a list of results that were stored in various caches. The method seemed to deliver results for sites that receive high traffic. I tried to cross-match the results with online advertising, but the results were inconclusive. My research indicates that Google Instant seems to favor high-traffic sites and popular topics, such as the letter “g” displays hits to Google and Gmail, surely not an accident of chance? The query “ga” returns entries for games, which is a popular topic. (Popularity can be estimated using a number of different tools, but I rely on Google Trends at http://www.google.com/trends.) You can test the popularity of the queries in this column by typing the keyword in the search box and looking at the traffic reports. The public version of Google Trends does not show actual clicks per time interval, but you can approximate the relative popularity of terms by entering a multiword query like gaga, games. Google plots both lines. Lady Gaga recently passed a billion downloads of her videos, so you can see relative popularity easily. Games are more popular than Lady Gaga it seems. But when you enter “gag,” Google displays Lady Gaga.

But what about more obscure words and phrases? Consider the search for IP, an abbreviation of intellectual property. Google leaps forward with hits to Apple’s iPad. In order to locate documents about intellectual property, I had to run the full query “intellectual property.” The other fix I stumbled upon was to turn off Google Instant. Depending on your context within Google, you can turn off Google Instant via the “search settings” link at the top of a results page or click on the toggle “Instant is on” next to the search button. A click turns instant off.

Now what does this have to do with a small or midsized business getting found via a Google search? My opinion, which has been informed by my test queries, is that big companies and popular words and phrases have an apparent advantage. American Airlines, for example, will have to work harder to generate traffic to its website. But a more practical approach may be to invest in Google’s Ad Words to make certain that when certain queries are run, American Airlines turns up.

There are other approaches, as well, but some of these will require some time and effort to implement. Let me run down six suggestions for you to consider if the Google Ad Words approach is not suitable for your business.

First, you can sign up for Google’s local listings. The easiest way to get to the sign up page is to navigate to Google.com and run a query for “Google Places.” You will need a Google account to create a free listing. Keep in mind, however, that the free listing does not guarantee that your entry will appear quickly or that your listing will be permanent. The listing for my company, Arnold IT, has been under review for months even though I was an early participant in the program. Google will also offer for-fee options to increase your firm’s visibility. These are called Google Tags and provide a preferred listing in certain results lists. Tags are free for some registrants, but I have heard about fees for tags as a forthcoming feature.

Second, you can increase the flow of original content to your blog. That content can then be distributed via really simple syndication. Google offers a blogging service at www.blogger.com, but Google does not appear to favor users by blogging platform. Google is paying considerable attention to websites and blogs that produce original content on a consistent and timely schedule. My blog at www.arnoldtit.com/wordpress is indexed frequently even though my business is not listed in Google Local. Google’s different units and services are not tightly coordinated in my experience.

Third, you can look at advertising options on Facebook. For some businesses, Facebook offers advertisements that can be targeted to specific demographic groups. Some of the Facebook advertisers with whom I have talked report considerable success with Facebook’s display advertisements. However, some advertisers of more general products and services have found that ads are less effective than mounting a Facebook content campaign. You may want to test Facebook advertising and experiment with increasing the content flow to a Facebook page about your business.

Fourth, you may want to take a close look at your present website. Content, not graphics and high style, is more important than search engine optimization tricks. If your website is more like a motion picture trailer, you may want to think about adding more product information or more detail about your firm’s success stories. If your website has not been updated in months, you should invest in getting more substantive information into the website. My recommendation is that content is more important today than at any other time. But Google is keeping track of the frequency of updates to a website. One time content updates are less useful than regular content additions.

The problem of getting a business found via an Internet search is growing more complex, not easier. The emergence of mobile device usage across different age groups and business functions is changing search. Small form factor devices like mobile phones or tablet computers make it difficult to type 1990s style queries in a search box. On my BlackBerry, entering a query in the provided mobile browser is essentially an exercise in frustration for me. To address this problem, some businesses are creating “apps” that allow one click access to content. Before you dive into an Android or Apple iPhone app, you want to do some hard thinking. App development is not a silver bullet and any type of programming can chew through a marketing budget like a hungry raccoon raiding a picnic basket.

In my own business, I am focusing on the basics. I am updating my website and publishing new blog content on a daily basis. As I look toward the rest of 2011, I may have to open my billfold and invest in Google’s for-fee advertising programs. The Web is changing as user habits shift from the desktop to mobile computing. The good news is that change brings opportunities.

Stephen E. Arnold is a consultant. More information about his practice is available at www.arnoldit.com and in his blog at www.arnoldit.com/wordpress.

Tuesday, 10 August 2010 12:47

Why a website is so yesterday

In the last month, one venture capitalist has asked me to review the websites for two of his most promising early-stage firms.

My team and I worked through the method we use to determine content density, site traffic, what the competition is doing, and technical plumbing.

What jumped out of these two analyses was that both of these ventures were serving quite specific markets. Both ventures had little or no competition. Both ventures were essentially invisible in the major online search engines. The only way to locate these two companies was by running a specific, multiword query.

When my analysts debriefed me, one major point jumped from the pages of analysis, charts and interview notes. That point was that the websites were a waste of money.

We reported our findings to our client, and he was thunderstruck. He said, “You are paddling against the current. The company executives have insisted on websites. We have had other consultants tell us that we need to make them compelling.”

After he finished telling us what he thought was the rationale for spending thousands of dollars, we went through some of the research findings we compiled.

First, we showed data from website tracking services like Compete.com that the traffic for the sites was modest. For one site, Compete.com had no data. We showed similar data from Google Analytics and from the Web analytics tools we use. The facts were clear. The thousands of dollars were not generating traffic, and there was no evidence that sales or leads were coming from a public Web presence.

Second, we reviewed case examples of companies with a website and a frequently updated blog. One of the case examples we showed was MarkLogic, an XML database startup based in Silicon Valley. The company’s website traffic was strong, according to the monitoring services we consulted. The key to success was that MarkLogic had integrated its Web presence into its other public relations, marketing and sales activity. The website, therefore, was one cog in a larger machine.

Third, we presented examples of online information that were social in nature. We showed Facebook pages and examples of Twitter campaigns. Facebook is a free service with more than 500 million users. A business can have a Facebook presence and use that system to present static information as well as fast-changing, up-to-the-minute text, pictures and videos about products and services. Twitter is a free or low-cost broadcast service. Instead of sending an old-fashioned Publishers Clearing House direct mail campaign by the U.S. Postal Service, we showed how companies like Pepsi and Procter & Gamble were using social media to build their brand and make sales.

The outcome of these analyses was a series of briefings about the trends that were taking place. Web pages are no longer the big dog in the online marketing kennel. A traditional website is more like one husky on a dog sled team. Most companies have not kept pace with the changes in the online marketing universe.

You may want to take a hard look at the time and money you have invested in your present website. Ask yourself, “Am I getting a measurable pay off from my Web presence?” If the answer is, “I don’t know” or “No,” then you will need to rethink your online business presence.

Our research has revealed that in today’s noisy market, a company wanting to maximize the impact of online marketing will want to consider what we call the “dog sled team” approach. Here’s how it works:

First, you will want to have a basic website with a URL that is easy to spell and is easy to remember. If you have a URL with a misspelling like “sumer” for “summer,” bite the bullet and get a new URL. Your technical adviser can explain how you can redirect to the new URL from the existing URL. As part of this website revamp, you will want to look at hosted content management services like SquareSpace.com and Weebly.com. The days of the hand-coded, proprietary websites are over. The cost is prohibitive for most companies who cannot afford the fees for changes or full-time programmers on the payroll.

Second, you will want to have a blog because it functions like your own, personal newswire. You broadcast information of your choosing. When you post a story, that story is blasted out to relay servers. From the relay servers, the stories go into Web indexing services to individuals who have an interest in the topic you write about. The idea that is revolutionary is that content finds the people who have an interest in the subject. The blog requires content, and you can write it or you can hire specialists to create that content for you. You put your name on the content and the stories help position your company as an important source of information about your business and your expertise. Your blog gives you your own Associated Press-type news channel.

Third, you will want to have a Facebook page for your business. The Facebook page includes some of the content on your traditional website, short headlines that link back to your blog, and other information created by your staff or the “friends” of your company.

What is revolutionary about this approach is that the standard website is a place where you can park basic information, fact sheets, product specifications and profiles of your sales contacts. The blog gives you a way to pump out information each day or more frequently of interest to your customers and prospects. Your salespeople can send a story to a prospect or invite those whom you meet at a trade show to visit your blog and leave comments. The Facebook page makes it possible for you to build the social presence of your company.

Facebook combines elements of a traditional website and a blog, but it has its own, unique social dynamic. When you combine these three online services, you are amplifying your online presence. Once you have the basics in place, you will be able to keep your presence fresh. You may want to create short audio or video programs, post pictures of your new products or create a small application that makes your content available with one click from an Apple iPhone or another mobile device.

The key point is that the website is no longer able to drag your marketing program from point A to point B alone. You have to give your big dog some helpers. With that shift, you will have a more agile marketing program and you will be able to cross the finish line more quickly than you did when you relied on your website.

Stephen E. Arnold is a consultant. His website is www.arnoldit.com. His new Google monograph about Google’s nontext initiatives will be available in September 2010. A sample chapter is available at http://www.theseed2020.com/gbt/

 

Tuesday, 06 April 2010 11:45

Google AdWords

Google’s share of the Web search market has continued to increase. Google, depending on whose research data you look at, controls anywhere from 68 to 80 percent of the market. With hundreds of millions of queries per day, that is a lot of eyeballs.

In June 2009, Hitwise reported that Google had an 87 percent share of the market for online advertising. Yahoo had a market share of 4 percent. (http://www.adwords-advice.co.uk/?p=52). In November 2009, AdWordsBuzz.com wrote: “Predicting Google is tough. It seems like every other week, they advance the game. … And often it’s done by surprise.” (http://www.adwordsbuzz.com/2009/11/2010-adwords-predictions-from-a-google-insider.html)

AdWords are paid listings that appear above and to the right of a Google results list. Paid search means that an advertiser can bid on the words in a user’s query. When one of those words appears in a user’s query, the advertiser’s text ad appears. The advertiser pays when a user clicks on a text ad. These ads are referenced as “pay per click” or “cost per click” ads.

Unlike an ad on a billboard, the ads are ranked and scored. Google’s system considers the page rank of the landing page, the cost per click (bid price for a word) and the click through rate for an ad. Complicated? Yes. Do AdWords work? Usually. Expensive? AdWords ads can be. Alternatives? Microsoft’s adCenter and Yahoo Search Marketing.

But with an 80 percent plus share of the market, Google is the place to be for the foreseeable future. The online advertising game can change, but for now, if a company is not advertising in Google, it may be almost invisible. More and more businesses are advertising on Google to get Web site traffic, generate leads and make sales. 

AdWords has spawned its own mini-ecosystem. Your local advertising agency may offer Google AdWords support. You can attend conferences like Perry Marshall’s AdWords Elite Master’s Summit, held this year in Maui, Hawaii. Amazon lists more than 40 books that teach you the basics to the secrets of the top 3 percent of search advertisers. If you want an expert to assist you, a query on Google for AdWords consultants will show you more than 700,000 Web pages to explore. Don’t have time to read 300-page books or talk on the phone to AdWords experts? You can navigate to YouTube.com and pick from more than 17,000 videos. To get insight into the inner workings of the Google AdWords system, watch Google’s chief economist explain the plumbing. Buckle your seat belt because Hal Varian is a Ph.D. and has a laundry list of publications and honors. Google has grouped sequences of videos into playlists. You can fire up your notebook and let Google pump the information you need to generate leads, make sales and pump up your Web traffic with a mouse click. Navigate to www.youtube.com and enter the query AdWords. Google also publishes “Inside AdWords,” a blog that covers the newest features available to advertisers.

Google won’t say how many AdWords customers it has, but to generate the company’s $20 billion in revenue from ads that cost from 5 cents to $50 or more, Google clearly has hundreds of thousands of customers.

Google publishes a number of AdWords success stories. The First Crush Restaurant story is representative. The owner of this San Francisco eatery experienced a fourfold increase in business. He told Google, “I’ve had a busy decade. And Google AdWords will play a big part in keeping us busy for the next one.” (For more about First Crush’s success with AdWords, point your browser to www.google.com/adwords/select/success/firstcrush.html.)

Is your business using Google AdWords? These are text ads displayed in Google search results. If not, you may want to consider adding Google AdWords to your sales and marketing arsenal.

The first step to take is to snag a copy of the free 114-page publication AdWords Reference Guide. You will learn about the AdWords “Control Center” and then move on to picking words, click-through rates, conversion rates and detailed information about selecting keywords. The Guide provides specifics on steps you can take to avoid running into Google’s software police. These tireless filters block ads that violate Google’s rules for AdWords. The Guide provides a refresher on the basics of creating compelling ad copy with examples of what to do and not to do. Tip: Emulate the ads that Google identifies as performing best. To get the link to the publication, navigate to Google.com and enter the query “AdWords Reference Guide.”

Before you call your ad agency or go scouting for an AdWords expert, you will want to sign up for an AdWords account by pointing your browser to adwords.google.com. With your account, you can log into the AdWords site and tap into the tutorials and other information available without charge.

Before taking a quick look at AdWords, keep in mind that AdWords is an auction or bidding system. The word “bid” is a bit misleading. Google’s AdWords system is more like a game. The variables in the price of a click depend on your maximum bid for a word and your click-through rate. The idea is that the more relevant your ads are, the more the Google system rewards you. You can pay less than your maximum bid or what Google insiders call “max CPC.” The AdWords system, according to AdWordsHowTos.com, “automatically calculates the CPC you need to maintain the position of the competitor below you, and charges you only 1 cent more to display your ad first.”

If this sounds like a brew concocted by the witches in William Shakespeare’s “Macbeth,” you are right. But consider the alternatives. You could buy display ads in your local newspaper. Rates have been skyrocketing in the last year and may be out of reach of many businesses. You can buy a traditional Yellow Page directory ad. These are expensive and have been losing their sales impact as such services as Google Local have gained ground. You can pay for direct-mail packages. With the rising cost of postage and printing, these are no longer the bargains they once were. With Google’s grip on the Web search market, the advertising path circles to Google.

Now let’s focus on some basics I learned the hard way. I just jumped into the AdWords pool and learned how to swim without an instructor to hold me afloat.

First, learn what you can but tap into a firm or consultant in whom you have confidence and from whom you can get some references. AdWords is too important to leave to trial and error.

Second, you will need to have a landing page to which your ad directs people who click on your message. “Landing page” means a page on your Web site that provides information related to your ad. A landing page can be a mini-sales presentation or a contact-me form. If the landing page is cluttered or not related to my query, I click away, sometimes as quickly as a second or two after glancing at the landing page.

Finally, Google provides a wealth of analytical tools. I made the mistake of trying to make sense of the many different data points. Now I focus on the basics like how much traffic did my ad attract. I focus on the ads that deliver traffic and kill the underperformers.

What sets Google apart is the fact that it processes more than two-thirds of Web searches worldwide. Google continues to offer additional advertising options. I learned to take baby steps, manage the amount of money spent and experiment with keywords.

Google has most of the Web search market because of the package of free search, on-point ads, and a wealth of easy-to-use tools, applications and services acting like a powerful electromagnet.

Google AdWords is, in my opinion, an essential part of an effective marketing and sales program. With mobile Web access poised to surpass desktop searching, advertising on Google becomes even more important.

Stephen E. Arnold is the founder and president of ArnoldIT.com. You can get more information about online marketing, systems and technology from www.arnoldit.com. He posts to his public blogs frequently: www.arnoldit.com/wordpress and http://ssnblog.com.

 

 

Tuesday, 05 October 2010 20:00

Inbound marketing

The U.S.

Postal Service loses billions of dollars every 12 weeks. A mantra at the U.S.

government meetings I have attended since 2000 is, “We have to run our agency

like a business.” After tallying a third quarter loss of $3.5 billion, the

business leaders at the dinosaur-like USPS predicts a “cash shortfall” in

fiscal 2011 which begins on Oct. 1, 2010. No kidding?

Does

your business still rely on traditional mail or “snail mail?” The “snail” is

not the French delicacy escargot aux grenouilles. The snail is the metaphor for

moving slowly. In the age of e-mail, sending a hard copy of a document is less

convenient than firing up my free Gmail account, banging in the message and clicking

the Send button. Snail mail is inherently expensive: humans get involved, trees

die and petroleum products are needed for inks, delivery and envelope glue.

But

snail mail lives and it has its uses. One can send a hard copy of a document,

get a bit of colored cardboard that “proves” the envelope arrived where it was

sent and that a person (usually with an illegible hand) signed for the envelope

or carton. Lawyers love snail mail. My cable company sends me a fat invoice

each month stuffed like a Thanksgiving turkey with discounts, deals and

“important reminders.”

The

USPS has tried to get into the electronic mail business, but like many

government initiatives run by appointees and crafted by committees, the postal

service failed. FedEx and UPS owe their success to the decades of floundering

at the USPS.

Savvy

marketers have figured out that spending $2 per piece in a traditional direct

mail “blast” is expensive, time-consuming and inefficient. A return of 1

percent is a home run with many response rates from traditional direct mail

failing to cover their costs.

What

can a business do to reach customers and not fall into the snail mail direct

mail rut? The answer, based on our research funded by a large educational

publisher, is don’t mail. That’s right. No traditional direct mail campaigns

like the now infamous America Online carpet bombing of signup discs. And no

e-mail spam campaigns. Aside from being annoying and possibly catnip to law

enforcement agencies, unwanted e-mail is often filtered out by Internet Service

Providers. Even e-mail from known colleagues can go unread. Time is short, and

only a few Type-A personalities are sufficiently obsessive to deal with the

flood of digital messages.

Think

about getting a marketing message out to a handful of business contacts. The

most efficient way to reach these individuals may be to pick up the phone and

call. But I don’t like the telephone and I ignore voice mails. In fact, I

delete most without listening to them. My attorney allows his voice mail to “fill

up.” He told me, “I don’t have to answer voice mails because no one can leave

them.”

You can

contact a small number of business associates in person. Golf and other

real-life social events are popular for this reason. You can fax a message, but

we learned in our research that the fax machine is loved by lawyers and not too

many others. In one organization we visited, the fax machine was used as a

makeshift coffee dolly. Financial services firms rely on messenger services to

move documents with a medallion seal from place to place.

The

shift is from outbound message methods to inbound message methods. “Outbound”

means that a business would push a message to one or more recipients. The idea

was to make a contact. The marketing method was the equivalent of picking up a

rifle or shotgun, loading up the payload, and aiming the weapon in the general

direction of the target. In today’s business world, the approach is easy to

understand and has legions of true believers. The problem is that the outbound

methods don’t work too well for most organizations. Have you bought legal

services from a telemarketer or a cable TV advertisement? Did you hire your new

accounting manager because you received a fax from a job seeker? No. The

traditional methods are ill-suited to the way organizations operate today.

These are outbound marketing methods and rely upon push.

Here’s

a mental exercise: Snip a 12-inch piece of string and place it on a flat

surface. Now try to push the string. What happens? The string is hard to push.

That’s the outbound marketing method. You can move the string, but it is

inefficient.

Inbound

marketing means that prospects, customers, friends and those with an interest

in what you do, find you. Visualize the grade-school science lesson with a

magnet and paper clips. The magnet gets close and the paper clips jump to the

magnet. Some paper clips stick to other paper clips. That’s how inbound

marketing works. Like the “magic” of magnetic attraction, interested people

jump to the “information magnet.”

How can

this method of inbound marketing be applied to your business? Our research,

conducted for a $1.5 billion information company, revealed four actions. Like

any marketing activity, the actions are a mix of the easy, fun, tedious and

difficult.

In

terms of a traditional marketing campaign involving direct mail, printed

material and telemarketing — inbound marketing is comparable in terms of

difficulty. The costs run about 15 to 25 percent lower. Some different skills

are required but none is particularly hard to learn. Your existing sales and

marketing team may have the requisite skills, so amping up your inbound

marketing can be seamless.

Now

let’s look at one approach our research revealed as particularly effective for

generating sales leads and customer contact.

First,

you will want to gather your existing marketing messages together and get them

in an electronic form. You will need the words in a text file. News releases,

PowerPoint presentations and marketing collateral can be put in a single folder

in Windows or a Mac, for example. If you have graphics, you will want those in

that folder, as well. I like to use Web standard graphic formats, and I avoid

proprietary file formats and versions of art designed specifically for

printing, a favorite medium of the outbound school of marketing. If you have

videos or audio records, you need to get these in the folder, as well,

particularly if you want to use these in your marketing campaigns.

Second,

you will need a free blog. You can sign up for a blog service that offers

fill-in-the-blank templates. There is a desire to create original designs for

blogs, but I think you will be better served if you use a free template and

make minimal changes. We learned that most people do not visit a blog to read

content. The information is consumed using aggregation services. If you are not

familiar with a news aggregation service, take a look at www.alltop.com,

www.dailyroation.com or Google News. These services process notifications that

new stories have been posted on a blog and provide a convenient one-stop shop

for blog information.

Third,

you will want put in place a method to convert your existing information into

news items for your blog. Because you are recycling existing content in

electronic form, the stories are little more than edited versions of what you

have already approved. For examples of blog posts about a company’s products

and services navigate to Access Innovations’ Taxodiary at http://taxodiary.com

or I/Gear Technologies’ Redefining Monitoring at http://redefiningmonitoring.com.

Fourth,

you will want to let people know that your blog is available. You accomplish

this by taking these actions. Turn on the RSS function. RSS means “really

simple syndication” and free blog systems offer this as a standard feature. Then

issue a traditional news release using your public relations firm or a Web

service, such as PR.com at http://www.pr.com or Free Press Release at

http://www.free-press-release.com. Neither of these services is perfect and you

can find many low-cost news release services. Finally, notify your existing

customers and prospects by email that you have set up a blog to provide them

with news and information about your business.

When

you publish a consistent stream of content via your blog, you are activating an

electromagnet for your business. The information flowing from your blog into

the Internet becomes available to people with an interest in what you are

selling. These individuals can, at their option, read your articles and follow

the links that you include in them. For example, in the Taxodiary example, the

Albuquerque, N.M., small business reaches potential customers worldwide. In

addition, the content is indexed by Web search systems, such as Google’s

http://blogsearch.google.com, specialized services like Collecta.com at www.collecta.com,

and social media sites like Facebook.com if you put the articles on a

Facebook.com business page.

Let’s

recap. This inbound method leverages existing content. In fact, you can

continue with your traditional marketing and public relations methods and just

add the outbound technique to turbo-charge your current activities. The

principal cost for the inbound technique described is the time required to set

up the blog, repurpose the content, and send out the news release and e-mail

announcement to your existing prospects and customers.

The

downside of the approach is that this particular technique is a change in

direction. Electronic methods that reach a potential community of tens of

millions of faceless professionals are different. The inbound method relies

upon software and social networks to expose your magnet’s force to those with a

problem your company might be able to solve. And the inbound method is fuzzy,

intangible and magical, just like magnetism.

The

upside is that you can supplement or replace traditional marketing. You can

reduce costs, particularly for direct mail, some telemarketing, and possibly

certain direct sales activities such as trade show participation. You can pick

and choose when to use traditional rifle shot marketing. For other types of

business messaging, you can rely on the inbound method.

Keep in

mind that the blog is just one inbound marketing technique. There are others.

You can create digital radio programs called podcasts. You can do short videos

and post them on YouTube.com. You can sponsor small business meetings, called

meet ups. You can assemble your own business broadcasting service that

disseminates information about your products and services each day of the week,

worldwide, without delay, intermediaries or the punishing costs for printing,

postage and trade show fees.

Like

any great recipe, seasoning makes a huge difference. So, if you are using

traditional snail mail to market your firm. You can add zest to your present

outbound marketing with these new, lower friction inbound marketing spices.

Sell the digital sizzle without the costs for traditional marketing beefcake.

Stephen

E. Arnold is a consultant. His website

is www.arnoldit.com. His blog “Beyond Search” is at www.arnoldit.com/wordpress.

Tuesday, 06 April 2010 11:09

Google local

Assume you run a pizza joint, maybe three or four pizza joints. A customer walks in and says, “I have a QR code. I want a slice of cheese and pepperoni.”

Make any sense to you? Probably not, but before I explain a free coupon, a Google-generated bar code, and a free slice, I want to highlight some facts:

ITEM: Google’s mobile phone operating system has captured the attention of the mobile world. In Barcelona, at an annual gathering of telecommunications insiders, Google’s chairman and CEO, Eric Schmidt, delivered a keynote speech and hosted an Android operating system “Developer Lab.” Two years ago, Google was on the bench watching the action.

ITEM: Dell’s Mini 5, a handheld computer with a phone, touch-screen interface and Google Apps, runs the Google Android operating system.

ITEM: Android, the open source operating system captured 5.2 percent of the U.S. mobile phone market share, up from 2.5 percent in September 2009, according to a Dow Jones newswire report.

ITEM: At the consumer electronics show, MIPS Technologies Inc. announced an Android-equipped digital home device, a Swiss Army knife of video recording, Web browsing and personalized program guides.

Who knew?

In 2007, Google was the Web search and advertising company with dozens of wacky projects like Web Accelerator (big flop) to the Google online spreadsheet (too slow) and the home run Google Maps service. Google was quirky, rolling in cash and a long shot for making headway in the insular world of telecommunications.

Google knew.

The company began its long march to telecommunications in 1999, a year after its founding. The company’s patent applications reference mobile communications, but the reference seemed like little more than one of those kitchen-sink phrases that attorneys put in documents to broaden the scope of a patent application. Between 1999 and 2006, Google’s patent filings reveal a building-block approach to mobile functions and services. The most striking invention for those who took the time to review these public documents was Sergey Brin’s “Voice interface for a search engine,” filed in February 2006.

Shift from Google’s increasingly large role in mobile devices, set-top boxes and mobile operating systems to the familiar business directory, known colloquially as “the Yellow Pages.” Like other print reference books, the Yellow Pages are in my office. I know I receive a couple of copies once, maybe twice a year. But I have not used a printed phonebook for two, maybe three years.

How do I locate a painter, a lawn service, a tailor who can repair the faux fur on my parka? I use a Google service at http://local.google.com. Sometimes when I am in another city, I use my BlackBerry, navigate to Google, and enter the ZIP code of my location and the word that describes what I need: For example, 20008 pizza. Google lists pizza joints in that neighborhood in Washington, D.C. If I click on a listing, Google delivers one of those Google Maps with red flags indicating where I can buy a slice. I get the phone number, and if there is a link in the listing, Google shows me information about that pizza place.

The question is, “Is your business in the Google Local service?” Google Local, as you now know, is Google’s digital equivalent of the traditional Yellow Pages directory enriched with Google Maps, Web links and a business advertisement.

Right now, creating a listing for your business in Google Local costs nothing. To list your business, go to the Google.com search page and enter the query “Goggle local business center” and click on the first link. You can sign up. If you already have a Google account, you will want to log in to the service.

The process is easy, and you will be able to describe your business, list your hours of operations, provide your business’s Web site address, and add links to videos and photos. The service is offered at no charge, and the information you provide is indexed by Google and made available to the company’s millions of online users.

However, there is one feature of the Google Local service that warrants special attention. Google makes a coupon or special offer feature available, also without charge. Here’s how this works. Click on the coupon link, and you can create an online ad with different fonts and your own message. A person who locates your business online can use this coupon when visiting your business to claim your special offer. I was able to get a free slice of pizza by showing the kid on duty my BlackBerry’s screen with his pizza chain’s coupon visible. No delay. No push back. The fellow asked, “Cheese or pepperoni?” I was sold.

With the costs of paper, ink and rolling trucks skyrocketing, traditional directory publishers have to find a way to generate new revenue. Most of the large directory publishers offer online business directories. I worked on the original USWest business directory called USDEX in the late 1990s. I know that most people looking for information go to Google, which means that Google has done an end run around some of the business directory services. You may be advertising in your regional telephone company’s business directory, and that may work for you. My view is that you may want to be listed in the Google Local service because economics are fighting the traditional Yellow Pages, and Google gets more than 70 percent of the online search traffic in North America. With that volume of eyeballs, you may want to be in the Google directory, provide Google with a video of your product or service in action, and offer a coupon.

Now think back to those factoids at the beginning of this column. Google’s Android operating system is open, which means that device manufacturers can use it without paying hefty licensing fees or dealing with gatekeepers like Apple’s licensing department. As Google’s presence in connected devices increases, your listing has a greater chance for exposure to potential customers.

Consider these situations in which Google Local may amp up the traditional business listing directory.

My wife and I are sitting on the sofa. I am reading and she sees an advertisement for one of those futuristic vacuum cleaners. With an Android-equipped set-top box, she can pop open a window on the digital TV, enter the name of the manufacturer and see a listing of stores that sell the product in our immediate area.

I complain, so she takes her mobile phone and navigates to Google Local and browses the store information. The idea is that the Android operating system embedded in common devices makes looking up a source of a product or service easy and painless. I know schlepping into the kitchen to open the drawer that contains a 2-inch thick directory is not that difficult. The point is that Google wants to make search a seamless part of a person’s behaviors.

My father, who is 88 years old, only knows the printed Yellow Pages method. Anyone with some comfort with the Internet will use what’s right there, ready to go and interactive.

Microsoft beat Google to the punch with embedding smart software in automobiles. Ford’s Sync product runs on Microsoft code. But Microsoft’s software carries a license fee. Other automobile makers, including prestigious German luxury carmakers, are using Google’s Android to deliver geolocation services, information and automobile diagnostic services. Sergey Brin’s voice search invention makes clear that Google has technology that delivers Google Local information at a spoken command.

You can think of other ways in which operating systems, devices and local business information can blend into new, useful services. My suggestion: Take advantage of the Google Local listing service, upload a video and create a coupon. Google seems to be poised to deliver customers.

Now navigate to Google Favorite Places. Just point your browser to Google.com and run the query “Google Favorite Places.” Log in with your Google user name and password. Next time you see me, I will have a Google Map to your business, your business listing, my Google QC code and your Google coupon. I want another slice of pepperoni, please.

Stephen E. Arnold is the founder and president of ArnoldIT.com. You can get more information about online marketing, systems and technology from www.arnoldit.com. He posts to his public blogs frequently: www.arnoldit.com/wordpress and http://ssnblog.com.

 

 

Among the headline-grabbing stories in recent months has been

Facebook privacy. Facebook has emerged as a major online force, with between

400 million and 500 million members.

What put Facebook under the mainstream media’s halogen spotlight?

Without any pre-announcement, Facebook flipped private settings to public.

Facebook users cried foul, and the company’s founder apologized and began

backpedaling.

Making the private public was not such a good idea. Facebook introduced a

simplified control panel to make privacy settings easier and less complicated.

(If you want to check your privacy settings, from the Facebook page, select

“Account” and access the privacy controls. To fiddle with the controls, click

“Customize Settings.” Be sure to check the settings for applications and Web

sites. For a business, the application options make it possible for software

robots to tap into your Facebook information. My suggestion is to turn off

“Instant Personalization.” You can activate it if you find that it is important

to your business.) The new, simplified Facebook privacy controls are confusing

and complicated. Facebook wants to monetize its service, and the more public

information available translates to increased revenue opportunities.

In an interview with Larry Magid, a well-known journalist writing for the San

Jose Mercury News, Mark Zuckerberg,

Facebook’s founder, said: “There has been this rumor going around that’s completely not true, which is

that we give information to advertisers, and we don’t. ... We don’t sell any

information, and we never will. ... We’ve been working on these changes to our

privacy system for the last six months, but now we’re done. We’re not going to make

changes for a long time.” (Read the full interview here.)

What should a business do if it has a Facebook page? There are some basic steps

you can take. First, visit your company’s Facebook page and look at the

information displayed. If there is information that you do not want made

public, you may want to take a step back and make sure that policies and

procedures are in place to make a repeat event unlikely. Then once the policy

is in place, you can either delete or modify the information. Facebook is a

free service, and the type of customer support one expects when paying for a

business service is simply not available.

The next level of effort is to dive into Facebook’s privacy control panel.

Among the major adjustments made as the firestorm of controversy raged is

control over what is available to other applications and Web sites. Hyper

modern sites like Facebook make it easy for a programmer to tap into its

content and use it to inform other services. Pandora, a music streaming

service, looks at what a Facebook user has listed as his or her favorite music,

then uses that to create a customized playlist. Facebook is social, permits

access via its application programming interface, and contains information about

a Facebook users’ actions and persona.

Can a mere mortal configure Facebook’s privacy settings? In a

word, no. Most business-centric Facebook pages will not contain personal

information in most cases, but the same privacy interface and options apply across

Facebook accounts. A casual click through of the settings may not be

sufficiently rigorous for an organization. Configuring the privacy settings is

a job for a person with Facebook savvy and knowledge about what the company

wants exposed. A useful first step is to navigate to the All Facebook blog and

read “Time to Audit Your Privacy Settings. Here’s How,” published by Fast

Company. (Source)

Another problem is that the word “privacy” may have one meaning to a team of

20-something programmers and another meaning for a 45-year-old restaurant

owner. Privacy has become a boundary between generations of online users.

While the company has taken a publicity hit, it hasn’t shown any signs of

slowing. Protests and government investigations have had little or no effect on

its growth.

Facebook’s advertising business is booming and the Facebook site vies with

Flickr for pictures and YouTube for video.

The basic content for a business page on Facebook should be objective

information about your organization. Other useful content to put on your

organization’s Facebook page includes photographs of products, services, and,

in some cases, facilities. Pictures of an office party or a golf outing may be

misinterpreted. Lean toward conservatism, and when in doubt, leave it out. If

your organization has a blog with an RSS (really simple syndication) function,

you can push the blog content to your organization’s Facebook page. The key to

making these features work pivots on the individual managing the Facebook

presence and the time invested in your presence there.

Two years ago, a business had to work around Facebook’s system to create a

presence in its community. Today, Facebook wants businesses participating.

Will another service topple Facebook from its lofty position? Based on the

company’s fast growth and its users’ indifference to management

high-handedness, Facebook has an unobstructed path to a pot of advertising

gold. For the foreseeable future, Facebook may be running a digital Disneyland.

Walt Disney would have understood Facebook’s determination to take necessary

steps to ensure that the company dominates its business sector. It lacks

Disney’s cheerful public persona but with 500 million members, Facebook is

doing something right.

Stephen E. Arnold is a consultant.

His Web site is www.arnoldit.com. His new

Google monograph about Google’s nontext initiatives will be available later

this summer. A sample chapter is available at www.theseed2020.com/gbt/.

Monday, 05 July 2010 20:00

Cloud computing

You know the drill. License software, often at sky-high

prices. Then you pay for consultants, integrators and training. A few months

later, the software needs an upgrade. Rinse and repeat. Expensive and for

decades the way to provide yourself and your employees with word processing,

e-mail and other must-have programs.

A new phase in computer use is beginning. The shift is plump

with opportunities to save almost any organization money in software license

fees, on-premises hardware and consultants. Oh, the consultants — experts in

networks, customization, optimization and dozens of other geekspeak services.

The buzzword for the alternative to on-premises software is

cloud computing. For me, the key event in cloud computing was Apple’s iPhone.

The gizmo made phone calls, but millions of people bought these devices and

realized that the software and services they wanted were out there. The

“there,” of course, is the network cloud.

Netbooks and the iPhone were catalysts. Now the giants of

computing are jumping into cloud computing with both feet. IBM and Verizon have

announced a cloud partnership. Microsoft offers most of its enterprise software

as a cloud service. Google has been expanding its cloud offerings with additional

security, support for Microsoft Exchange, and other features at a healthy pace.

Start-ups abound. Some have a high profile among the

technically savvy, but these services can save some organizations big money.

Let’s try to answer the question, “How can cloud computing help your bottom

line?” Let’s look at two cloud services anyone with basic computer skills can

use immediately.

First, if you have been paying for a contact management system

like Act or wrestling with Microsoft Outlook, try Zoho’s free customer

relationship management service. (http://www.zoho.com/crm) CRM is not

e-mail, although you can use e-mail with Zoho’s service or you can use your

existing e-mail program or some other vendors’ services.

Contact management is a component of CRM. The idea is that

when you meet a person at a business lunch, you can snag his or her card, enter

the details into the contact management system, and then add information about

your subsequent interactions with the person.

If you have three or fewer employees, the service is free. You

get access to Zoho’s leads and sales opportunities module, a contact manager, a

direct mail campaign system, a calendar and an administrative dashboard. There

is a limit of 100 megabytes of data storage, an import limit of 1,000 contacts

per batch and a maximum of 100,000 records. For many small businesses, the free

service is sufficient to get contacts organized and to start using Zoho’s

professional e-mail campaign.

The downside is that you may not know much about Zoho, which

is one of the leaders in cloud-based services or what some call SaaS (software

as a service).

Your information technology expenditure won’t drop to zero but

you can reduce the service and support costs. And once you are familiar with

Zoho, you could drop the on-premises system and its costs. Zoho, like Google

Docs, provides free and low-cost word processing, spreadsheet and presentation

software, too.

Are you paying for conference calls?

You will want to navigate to FreeConference.com and sign up

for an account. It’s free. You can duplicate most of the features of the

traditional AT&T conference call and get some additional features at a very

low cost. One useful service is FreeConference.com’s transcript. I often work

on projects for law firms, and the ability to get a hard copy of some long

conference calls is a real plus. FreeConference.com also offers a digital

recording of the call. You download the MP3 file, and you can use it for

reference or edit it for a podcast if that’s part of your marketing program.

If you have a tech-savvy person handy, you can substitute

Skype.com for FreeConference.com. With a video camera and Skype, you can offer

videoconferencing and the presentation functions of Scribd.com. You and your

conference participants will need to have high-speed connections. Be sure to

alert those on your conference call or webinar about the bandwidth

requirements, too.

How much can you save?

I used to use the Act contact management system. The software

cost me individually more than $100 per year. For me and four colleagues, I was

spending upward of $450 a year for licenses, and I had to have a computer whiz

on tap if I ran into trouble importing contacts or moving data from one

computer to another. For a larger organization, the cost of contact management

can swell to a very large number. With Zoho, I chopped the costs down to less

than $200 per year.

When I switched to FreeConference.com from my traditional

AT&T conference service, my monthly bill dropped from several hundred

dollars a month to zero for conference calls. Your savings may differ, but I am

delighted with the payoff from the cloud.

The range of cloud services is expanding. Rapid service

proliferation makes it difficult to know which service is the appropriate one.

My experience is that testing services is one way to get a sense of what’s

available. If that’s not possible, you can run a query on Bing.com or

Google.com for “cloud computing blogs” and start reading.

Expect to encounter some unusual company and product names.

Examples include Mikogo (www.mikogo.com), Yugma (www.yugma.com), Vyew

(www.vyew.com) and others.

In a couple of years, on-premises software will play a larger

role in many organizations information technology strategy because of its

affordability, ease of use and anywhere availability.

The negatives, which the established software vendors are

eager to point out, include the fear that data will be lost or stolen, the lack

of familiarity with cloud systems, and use of services from vendors that are

not household words.

For a small or midsized business, cloud-based services,

particularly for contact management and sales presentations, are reliable and

readily available. Once you have some experience with the cloud, you can then

consider eliminating such expensive, aging software products like Microsoft

Word, Microsoft Outlook and Microsoft SharePoint.

My suggestion is to get your feet wet. This is one plump cloud

that could yield a flood of payoffs quickly and consistently. With cloud

computing, you don’t need an umbrella. Take a bucket to catch your savings.

 

For more information about the author and

information about his firm’s information consulting services, navigate to

www.arnoldit.com.