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Blogs Beat Out Social Networking

So it's official (at least according to the latest research): blogs influence online consumers purchasing behavior more than social networking. This is not really surprising, but it's nice to have the stats to corroborate my thinking on this issue.

A 2008 research study of 2,210 online consumers by Jupiter Research, "Harnessing the Power of Blogs," found that frequent blog readers (those who read more than once per month) make up 20% of the blog reading population. These avid readers say that when making a purchasing decision, they trust relevant blog content over social networking content. The survey also finds that the number of Internet users who read blogs at least once a month has grown 300% in the past four years and that when a blog does influence a purchase, it does so at a critical stage in the buying process: "Decide on a product or service" 21%. (Topping: "Refine choices" 19%; "Get support and answers" 19%; Discover products and services" 17%; "Assure" 14% ; "Inspire a purchase" 13%; and "Execute a purchase" 7%.) The key factor bearing on a blog's ability to influence a purchase is its niche focus and topical expertise (natch).

Like I said, this is not surprising and confirms my strong suspicion. Blogs are a more mature Web tool; social networking—though the buzz darling of '08—remains mostly the domain of those 29-and-under and the Internet's lesser-accepted stepchild in terms of hardcore commerce. What I think will be interesting to watch is if social networking follows a similar track to the blog, in its emergence, development, and widespread professional acceptance. Consider: most of corporate America employs bloggers today. Will it be the same for social networking five years from now?

An aside: BuzzLogic, a display ad and buzz-building firm, sponsored the survey. While I think the sponsor has a vested interest in making blogs appear to be an effective marketing tool for your products or services (and thus some of wording of the survey results PRs seemed to paint an overly-rosy picture), they have no reason, as I see it, for favoring blogs over social networking.

What's America Buying?

Amazon has released its “Best of 2008” lists. These lists offer a nice snapshot of products that did well with consumers over the past year and especially over the holidays—when the online retailing behemoth had its best season ever. Granted there’s a segment of the population that will never purchase anything on Amazon, but with the company’s claims to offer “Earth's Biggest Selection” and serve customers in more than 210 countries, these lists do offer a certain kind of gauge. Four separate lists reveal the bestselling, the most positively reviewed, the most popular on personal Wish Lists, and most frequently purchased as gifts, as determined by Amazon.com customers in 2008.

Here are some tidbits I find interesting….

BESTSELLING

• Books: "Breaking Dawn" by Stephenie Meyer (The Twilight Saga, Book 4)
• DVD: "Wall-E" (widescreen single-disc edition)
• Music: "Viva La Vida" by Coldplay
• Video Games: Nintendo Wii
• Electronics: Amazon Kindle
  

MOST POSITIVELY REVIEWED

• Books: "The Revolution: A Manifesto" by Ron Paul (hardcover)
• Kindle Books: "Twilight" by Stephenie Meyer (The Twilight Saga, Book 1)
• DVD: "Jeff Dunham: Spark of Insanity"
• Music: "Noel" by Josh Groban
• Video Games: Wii Fit
  

MOST POPULAR ON WISH LISTS

• Books: "The Tales of Beedle the Bard" by J.K. Rowling (standard edition)
• Kindle Books: "A New Earth: Awakening to Your Life's Purpose" by Eckhart Tolle
• DVD: "Wall-E" (widescreen single-disc edition)
• Video on Demand: "The Bourne Supremacy"
• Music: "Viva La Vida" by Coldplay
• Amazon MP3: "I Kissed a Girl" by Katy Perry
• Video Games: Wii Fit

MOST FREQUENTLY PURCHASED GIFTS

• Books: "Twilight" by Stephenie Meyer (The Twilight Saga, Book 1)
• DVD: "Best of Elmo's World" DVD Collection
• Music: "At Folsom Prison" by Johnny Cash
• Video Games: Mario Kart Wii with Wii Wheel
• Computers: Acer Aspire One 8.9-inch Netbook, sapphire blue
• Software: Microsoft Office Home and Student 2007
• Electronics: Amazon Kindle
• Toys: Wild Planet Hyper Dash
• Apparel & Accessories: Pepsi-Cola 1970's vintage beach towel, white

I suspect the Kindle had just *a little* help from maker Amazon to top the Bestselling and Most Popular Gift lists in the Electronics category. (Can we say promotional tusnami and deep discounts on content?) And for full disclosure, I did not buy any of these products, nor in fact anything from Amazon this holiday season. I did, however, walk myself to the nearest indie bookstore in the San Francisco locale I was spending the holidays—Green Apple Books—and bought a gift certificate for my bibliophile brother-in-law. He loved it, world bestseller lists notwithstanding.

For complete Amazon results, visit: http://phx.corporate-ir.net/phoenix.zhtml?c=176060&p=irol-newsArticle&ID=1239459&highlight.

Amazon, in addition to having its best Christmas season ever this past year, is now set to capitalize heavily on big-name author branding and proactive author self-marketing: the online retailer has launched a beta version of a new feature called Author Stores—touted as “new corners of our bookstore dedicated to offering customers a new way to browse and shop favorite authors, discover new books, and more.” The new area features an A-Z list of authors, which links to individual author pages that include a bibliography, a biography, author photo, video streaming, and discussion board. All which can be modified and augmented by the author him or herself—or publishing house on the author’s behalf. And Amazon promises enhancements and greater functionality in the months to come. The beta release currently has about 2,500 of these mini author-sites, and according to Publishers Weekly interview with Amazon publicity manager Andrew Herdener, Amazon's long-term goal is to have an Author Store for every author whose books are available through Amazon. Herderner noted that Stephen King, J.K. Rowling, and James Patteron were among the first experimental wave of writers in Author Stores’ development.

On the whole, this sounds like a smart move by Amazon, leveraging the cult-of-personality around popular authors and empowering lesser-known authors to take a greater role in promoting their books—all for the benefit of moving more units through Amazon cyberspace. Of course the proof of the pudding is in the execution, so I'm reserving judment until we can see how these pages and their interface are developed over the next year.

Christmas Retail Winners & Losers

Well, the official stats won't be in for a couple weeks now, but all are indications are that this was a pretty dismal holiday season for retailers. In fact, the past year as a whole was rather humbling. Chapter 11 filings, liquidations, pleas for more time to restructure or for extended lines. A quick cruise around the financial pages reveal the bleeding carcasses of 2008: Circuit City, KB Toys, eToys.com, Linens 'n Things, Steve & Barry's, and Mervyns department stores—just to name a few. More store closings are expected in the fallout from the lack-luster Christmas selling season. Many retailers had hoped Christmas would be their bailout.

But not everyone has suffered. Apple, Inc. had a good year, buoyed by the success of its iPhone release. And online retailer Amazon.com said the 2008 holiday season was its "best ever," with more than 6.3 million items ordered. A recent AP report cites the online gaint’s bestsellers included the Nintendo Wii, Samsung's 52-inch LCD HDTV, the Apple iPod touch and the Blokus board game. Amazon was cited for doing a great job of offering deals and driving customers to its site, and promoting the notion that "the best possible prices" were frequently on Amazon.com. Even struggling Borders Group, Inc.was granted a bit more time to dig itself out of its hole and complete a sale of Paperchase Products unit, staving off immediate bankruptcy rumors. While that doesn’t make it a winner per se, at least it keeps this book industry standard out of the losers pile. For now.

So farewell 2008. You were the best of times, you were the worst of times. You are now one for the history of time. And here’s to 2009! May it be as intense and challenging and savagely beautiful as those before it. (And may we all do a better job with it, too.)

References: Associated Press; http://www.msnbc.msn.com/id/28389904/

A Few General Principles and Guidelines....

As follow-up to Thursday's post, I wanted to offer a few general principals and guidelines for improving your "numbers-based" marketing.

1. Make desktop delivery of key reports automatic. This includes sales reports, online traffic logs, customer service/inquiry reports, and others. It may take some time and tinkering to find the best set of indicators and formats for your business—but keep at it. Regular, automated reports are a guard against the all-too-easy tendency to forget or put off viewing the numbers in the course of our busy week. Also, invite the person who creates your reports (or yourself) to occasionally throw in a wild-card report to keep the view fresh and see what turns up.
2. Look for trends. Let me use an analogy: Let's say your company, like many others, is swimming in sales and customer data. You have an ocean of information. Without the proper focus, this can be overwhelming. Your goal in numbers-based marketing is to find the currents. You are looking for the currents in this ocean—where and how the energy is moving things, the flow. Otherwise, you'll end up just seeing this big vast ocean that is incomprehensible. So currents (meaning trends) are what you're after—not what one fish or piece of drift wood does (the minutia). Applying this analogy, don't be too concerned with what a single product did within a certain group or market segment—look for how a series, theme, or type did. Or perhaps products that serve "X" need or fulfill "Y" brand attribute. This is particularly true in an industry like publishing, where so many factors must converge to create a successful book: theme, author, cover, timing, content, packaging, and promotion & distribution (or lack of). It’s very complex and rarely an apples-to-apples comparison when looking at a single product and trying to reproduce that generally. So don’t spend too much time looking on the details: look for currents and trends.
3. Test. This one's pretty simple: try some stuff on limited scale. Track results. Assess the effectiveness. Seems like a no-brainer, right? But it's surprising to find how little testing is actually done in marketing departments. Usually this is because marketers feel they can barely cover their bases and get their "regular work" done. But testing is a leading method for identifying successful new ways to reach and woo your audience, for making you more productive, and can greatly reduce waste (including some of that "regular work" of yours).
4. Survey. None of us are an expert—not a consultant like myself, not the guy in the corner office, not the employee that has been doing their job for three decades. The customer is the expert. So talk to them. And I don't mean just anecdotally at a conference, exhibit, or in-store function. Survey your customers in a quantifiable way that will yield data on customer mindset and behavior. Today there are many very reasonably-priced online market research options that bring down what was once a cost barrier for some companies.
5. Do #1-4 regularly.
6. Discuss findings as a team at least 2x a year. Thoughtful discussion within your team is where the rubber hits the road in numbers-based marketing. Sales data is customer behavior on paper. It reveals what actually happened and who your customer is from an action-oriented viewpoint. Market research can reveal your customer mindset. This is information is too good to keep all to yourself. Discuss this together as regularly as you can, but at least do this Monday-morning quarterbacking twice a year.
7. Involve product development. Your discussion of the data, the questions it raises, and your meaningful findings should involve your business's new product development department (be that called Editorial, Product Acquisition, R&D, or what have you at your company). Marketing that does not work collaboratively with its developmental counterparts fails in a core responsibility to adequately represent the voice of the customer to the company and advocate for customer needs. Conversely, strong interdepartmental discussion of and collaboration over your sales history and market research is what enables a company to PUT TO USE its customer insight. Resulting daily actions and decisions are what make a company truly customer-centric.

Friday’s Fun Find 4 Business: Keynote Speakers, Inc

So it's time for the first “Friday’s Fun Find” of December. (*whew* That’s a lot “f” alliteration; good thing this isn’t the month of February.) One of my company's services is to build author platforms and nurture speaking ministries within the Catholic Christian market, and while doing some research, I came across this site that provides keynote speakers for events: KeynoteSpeakers.com

This firm is certainly not the only company out there providing this service, but what I like about them—and why they’re this week’s choice—is that their website not only offers a vast array of top-name talents (ex. Ken Blanchard, Bill Moyers, Phil McGraw, and Deepak Chopra) in easy-search formats, but also they provide ranges for these speaker’s fees. They give these by category. It's a good way to gauge today's going rate for a particular caliber of speaker in a specific field. With only a little time invested, authors and their publishers can get a sense of where they stand. Unfortunately for religious publishers, there isn’t a Spirituality category or even Values; people who speak on these matters would be lumped into Inspiration or Motivation. On the other hand, if you’re a religious author or publisher who also addresses the need for Patriotism, Ethics, or Balanced Living, there are categories for those. So one is able to form a point of reference and get an indication of the playing field.

Marketing as a Science

Although it wasn’t my original plan to hold an Albert Einstein quote-fest, we might as well round out the regular week (pre-Friday’s Fun Finds) with one more. This one is especially for my friends in religious publishing:

“Science without religion is lame, religion without science is blind.”

Of course my use of this quote twists Al’s original meaning—in this context “religion” refers to both a book category and type of mission, and “science” means the numbers-based marketing (vs. the creative) that I've been writing about lately. So liberties taken, I admit, but I couldn’t resist. 'Hope the great professor won't mind.

In my last post I promised some example of those “translator” and “bridging” questions that help marketers find the actionable information within research and data. One way to approach this is to group your key questions into categories to make sure you're asking a balanced spread. Here are some categories to consider and just a few sample questions:

1. CUSTOMERS. Think about your data in terms of two main criteria: a) creating more customers, and b) creating more active customers. Then within these two criteria are many, many questions you can pose. Ex. Translator Questions: “Customer group X is very active in purchasing Product A: What need, fear or desire does Product A answer for them?” “How much of Related Product B do they buy and how does this better define that motivating need, fear, or desire?” Bridging Questions: “How can I empower this active group to become customer evangelists?” “How can I revised my market positioning and sales messages to better address the identified motivator?" TIP: Remember when looking at customer data to consider both rate of order and size, then form your translator-bridging questions to examine these.

2. OFFERINGS. Again there’s two major criteria : a) selling more new products or services, and b) selling more exisiting products or services. And again, there's a vast array of questions you can pose to find usable information. “Product C is selling better than Product D; what are the needs, fears or desires behind this behavior?” Ex. Bridging Questions: "How do I adapt the strong-selling Product C into a new product in a different medium or form that responds to this same key motivator?" "How do I build a service-product that supports physical Product C?" "How do I capitalize on the strong sales of Product C to sell more of Product D?" OR, Translator Questions: "What do the categories or lines of products that are selling well tell me about my existing customers' motivations?" "What recurring patterns (3x or more) can I identify that are positive for my business or negative?” Bridging Questions: “In my promotions to these same customers, how can I better highlight the ways that products in other categories or lines provide solutions to this same motivation?” “How can I use these reoccurring patterns to selling more new product?” “—To sell more existing product?”

3. BRAND. Your brand is what makes you distinct from your competitors. Products are commodities and can be copied; your brand is unique and cannot be duplicated. Use brand to make sense of your data. Ex. Translator Question: "How well do individual products or services measure up to the business’s brand attributes (defined qualities of your brand that your business strives to embody) vs. How well did these sell?” Ex. Bridging Question: “What can been done to bring our future product development more in line with our brand attributes? In what ways can I repackage or remarket underperforming products to better illustrate how they embody our brand attributes and deliver on our brand promises?” "What underperforming products might I want to terminate because, in addition to low sales, I see that the do not reflect our brand attributes and they fail to deliver on brand promises?"

4. DISTRIBUTION CHANNELS. Some criteria: a) products sales by the means used to reach a market, and b) customers activity by the means used to reach a market.
Ex. Translator Question: “Which categories or types of products are selling best through which distribution channels?” “Which markets are responding best to which distribution channels?” Bridging Questions: “Can I increase or better focus my promotional budget to target particular products only in particular channels?” “Can I increase awareness in a given market that my products are available through this favored distribution channel?” “Is there a new or better way to reach my market?” “Can I more effectively partner with key players in underperforming distribution channels?”

5. BUSINESS UNITS. You want to know what the data tells you about the health of your business and its preparedness for the future. You are looking for actionable information that you can apply now so that your business will be where it needs to be in two, three, or five years down th road. Ex. Translator question: “Which categories do my most profitable offerings fall into? Is it all the same category?” Bridging question: “Am I properly diversified? How can I weather a downturn in that particular market or niche?”

There's a few more categories that I'd add to this list in order to achieve a well-rounded, balanced view—and I'd also advise a close look at specific marketing tactics or promotions—but this is a good start. Monday's post will follow-up with a few general principles and guidelines.

Data-Based Marketing, Steps for Success, and a little More Albert

Ok, here’s another quotation from Einstein that I love: We can't solve problems by using the same kind of thinking we used when we created them.”

This is exactly what I’ve been getting at. As marketers, we need to apply our analytical skills and way of “reading” the numbers to identify patterns, open up new perspectives, and stimulate different ways of thinking in order to solve problems and create opportunities.

One hurdle marketers express to me is the feeling that they are drowning in sales numbers yet don’t see any actionable information there. When I probe deeper, I find these marketers often don’t’ know what questions to ask other than things like, “How well did ___ sell? And how much profit did ___ make?” That kind of sales “analysis” repeated again and again won’t get us to Al’s different kind of thinking. Instead, try these steps:

First, remember this: research and data is just a numeric language for actual human behavior. What you need is a translator for this language. That translator is a series of good questions. There are all sorts of questions that marketers can ask when looking at sales histories cross-referenced with customer data—questions that spur deep reflection on customer action. I personally have a long list. (And you can check tomorrow’s post for a sample.)

Second, keep asking these questions, and the next logical question, until you arrive at a definable human behavior.

Third, what you’re looking for is the need, fear or desire that drives this definable human behavior. Sometimes this is already known. Sometimes it can be deduced. Most often you will have to ask. Actually get on the phone, send an email, post a question to your website, corner customers at an convention, whatever—just ask. And if you think you know the answer because you learned it when you asked ten years ago—better ask again. The reason may have changed or be changing.

And forth—and this is where the creative thinking side of marketing comes in—you need to then reflect on what I call “bridging” questions. For example: How do I use this behavior to my company’s advantage? How do I change my product mix to solve this need, fear or desire? How do I change our marketing or sales efforts to immediately speak to this need, fear, or desire?

Your first response should not be to try to change the defined human behavior; first you should brainstorm ways to change your company’s relationship to that behavior. For example, a customer group buy lots Product A and some of Product B. Relationship change: sell Product A packaged with Product B at a reduced rate. But don’t stop there. The real gold to be minded is found in the needs, fears, and desires you identified as driving the behaviors. Again, don’t try to change the customer’s need, fear or desirer—try to change your company’s relationship to that those three.

Looking at data in this manner will help you to see connections, think differently and lead to better product development and marketing and sales practices.

Numbers Marketing, Sales Analysis & Albert Einstein's Definition of Insanity

Yesterday’s post touched on the two sides of good marketing: the creative side and the numbers side. And I put forth the view that too often the numbers side of marketing gets short-shifted. Let’s look at just one area to start: sales analysis.

“Doing the same thing repeatedly and expecting different results.” —That’s Albert Einstein’s definition of insanity. Well, insanity must rage at many-a-U.S. companies and organization because time and again we hear of sales going down in a clear, consistent trend and leadership wanting to see sales rise and market share grow—but no one is willing to make significant change.

This is all too true in the publishing industry, where sales analysis often means merely forecasting and setting sales projections (if that). What is needed is an investment in one's infrastructure to produce some high-quality sales reports and customer data—if these systems aren't already in place—and a strong dose of reality based on a good hard look at the numbers. By this I mean that marketers should be looking at not only what the numbers are saying (“sales are flat or going down”; “this product didn’t turn a profit”; “these customers are buying less of this”) but also at what is often called “the story” behind the numbers.

This begins with asking pointed questions and expecting actionable answers. For instance: What the trends…? (ex. …of the clarity and strength of your brand? … of your competitors’ sales, when available?, ... of your industry as whole?, … in the tastes and sensitivities of your customers?) How well are your brand attributes represented in your products…? (ex. …those that are selling well? ..those that selling poorly?) Where are the opportunities…? (ex. …for cross-selling?, …for partnership building?, …for realigning of a product mix or bundling certain products together at better price?, …for offering a service product that supports a strong-selling physical product?).

Or, if a significant customer or group of customers is buying less of something—Why? For this question, in most cases, you’ll have to go ask your customer to find the answer. Notice that *gasp!* emanating from those who always want to do more the same (safe) thing or who secretly fear giving up their power, hunches, and own sense of World Order by handing power back to the customer. Yes, you will have ask—either anecdotally, through quantitative research, or, ideally, both. And when you ask, don’t settle for the usual surface answers that you knew or could have guessed from the start. Like, “The economy.” Or, “I gave my business to ____.” Ok, sure. But when a customer tells you this, remember to follow-up by asking, again, Why? Why did your customer favor your competitor’s product or service this time? What was their deciding factor?

Assuming you have built trust with the customer, if you ask this question right you should learn where you customer’s priorities are right now, their key motivating factors, and what problem are they really trying to solve. I guarantee you there’s always something deeper going on than just a cheaper price.

This kind of numbers-based marketing is essential, lest you throw good energy after bad, focus good creative marketing efforts into wrong areas, and—as Einstein says—sadly, expect a different result.