Biznology Blog: July 2005

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July 27, 2005

What is Holding e-Commerce Back?

I had a truly infuriating experience with a local brick and mortar luggage store, and it got me to thinking, "Why didn't I buy this online?" Why indeed.

I am a geek. I admit it. And as a geek, I am far more likely to buy things online, not just books, but unusual things, than others are. But I recently needed to replace my falling-apart wheeled luggage before I take my next trip for a speech. And I did not buy it on the Web.

And boy did I pay. My first mistake was venturing out on July 4, a holiday here in the U.S., because even though the store was open, they did not carry the particular bag I that I saw on the Web site. At this point I was told that they couldn't order it because the central office was closed until the next day. (Now, I could have ordered it that day on the Web and gotten a discount to boot, but I wanted to see it before I bought it.) I offered my credit card for a deposit, but the salesman told me he'd call the next day and take my card over the phone if they could order the bag I wanted.

The next day, the salesman called and asked me to come back in, somehow developing amnesia on how to take my credit card on the phone. (Now, I know that I could have ordered the bag the previous day on the Web for less money without leaving my house.) So, I dutifully trudged into the store and slapped down my card (paying 100% of the price as my deposit) and was told that the bag would come into the store within ten days. (Now I know that I could have gotten the bag shipped right to my house faster than that.)

20 days go by (yes, that's not ten is it?) and I get the call to come in to look at the bag. I look at it and I like it, so I start to leave, but the salesman says, "You need to show me the recipt we gave you when you ordered." I said, "You were the salesman that took the order—you know it is me and you know I paid the full price." He was impassive and said that he could not release the bag without the number on the receipt. I asked why we couldn't look up the number—surely the store had a copy. No dice.

So I wend my way back home and come back with the receipt. As I hand it to him, I carefully recapped my experience so far and told him that I can't imagine ever coming back to the store. He provided a perfunctory apology while he looked at the number on my receipt and then pulled a pad out of the deak and matched it to their copy. (Yes, he could have done that without sending me home.) Then he attacked the computer, furiously punching buttons to beeping responses.

And I waited. Punch, punch, beep, frown. Punch, punch, punch, beep, beep, grimace. Punch, punch, beep, beep, beep, grunt. I am not sure how long it took, but it seemed like a lifetime after all the inconvenience that preceded it. Then he got on the phone. Talk, talk, punch, punch, beep, beep. And then once more, with feeling. More talk. More punching. Lots of beeping.

I asked, "Can I leave now?" No answer. I waited another couple of minutes and realized I had been there for 15 minutes when I had paid three weeks earlier. At this point, I carefully pulled the receipt from the salesman's hand and quietly said, "I need to go." The salesman remained on the phone and never said a word to me as he continued punching and grunting amid the beep festival. I heard him say on the phone as I left, "The customer took his receipt and left."

Now, this is just another story of incompetent retailers. You've been there. And this isn't a tragedy. Was this experience so bad? But it made me realize how accustomed I am to getting instant access to order exactly what I want at a discount and have it delivered to my house. So why didn't I order it on the Web?

The dreaded return. I was unsure that I really wanted it until I saw it. As soon as I saw it, I knew it was what I wanted. But the possible hassle of packing it up and sending it back seemed too much of a risk to take. So I endured a lot more hassle instead, and then I ended up keeping it.

Perhaps I am unique, but usually I am boring and typical. If I could have bought the luggage on the Web with the offer that I could return it to a store if I did not want it, I would have jumped at the chance. Some retailers have connected their stores to their Web sites this way, but suppose you don't have a store?

Why don't e-tailers make a deal with FedEx or UPS or some other shipper to accept returns? The customer can take a look at what they got, stuff it back in the box, show the receipt and hand it off to the shipper to send it back—free shipping would be best, but I think I would have been willing to pay to return it if I just did not have to pack it up and get the awful RMA number.

I think I have learned my lesson, though. Next time, I will order on the Web and deal with the return hassle if I have to. But if returns were not any more of a hassle than they are with physical stores, I would be buying even more.

Posted by mikemoran at 9:08 PM | Comments (0) | TrackBack

July 25, 2005

Today's the Day

It took a year to write, but it's finally available. Today is the day that Search Engine Marketing, Inc. hits the street. My co-author Bill Hunt and I have been gladdened by the early reviews and the presales, but if you haven't bought your copy yet, now's the perfect time to order.

Whether you concentrate on paid search or organic, work for a big company or small, you'll learn what you need from this book to bring you search marketing success. See the table of contents to get a clearer picture of what's covered.

If you bought one already, thank you. If not, check out what you're missing.

Posted by mikemoran at 12:06 AM | Comments (0) | TrackBack

July 21, 2005

Changes Afoot for Google AdWords

Google's AdWords paid search program has always been designed to be different from Yahoo!'s competitive program—AdWords is less work to operate but Yahoo! is much easier to plan and predict. Google is now introducing changes to AdWords that may make it even simpler to run paid campaigns, while making the planning even harder yet. Find out what they are up to.

In our book, Search Engine Marketing, Inc., Bill Hunt and I painstakingly explain how to plan your paid search campaigns, so that you can predict both the cost and the return on investment. At least we do that for Yahoo! paid search—it is actually quite difficult to do with Google. Google's method of ranking their paid search results, which has recently been christened AdRank (to evoke comparisons with their PageRank organic search ranking algorithm), is far more complex than Yahoo!'s.

Yahoo! shows the ad that has the highest per-click bid first. Simple, huh? And because it is so simple, it is relatively easy to predict the outcome of your campaign. Although you can't know for sure that bidding a few cents over the current #1 bidder will result in you getting the #1 spot (because the incumbent leader could increase its bid), you can make a reasonable guess that it will. You can also estimate the number of clicks that you'll get from that #1 ranking by using standard clickthrough ratios (perhaps 5% for a good #1 ad) multiplied by the number of searches for the keyword (which Yahoo! tells you).

Contrast this with Google. Because Google's AdRank algorithm looks at both per-click bid and clickthrough rate, you can't know where your ad will land just by knowing how much you bid. Also, Google does not easily reveal the number of impressions you'll get with your ad, showing you the count for an average bid—not the bid you might choose. This makes it much harder to know how much you'll pay and how many visits to your site you will get.

The good news is that because Yahoo! is so predictable, search marketers can predict costs and return on investment. But Yahoo! bidders can also play games to force competitors' bids up, to look for large gaps in the bids to save money, and other such tactics. These (ethical) bidding tricks force search marketers to monitor Yahoo! campaigns much more closely. Some marketers even invest in bid management software or consultants to monitor campaigns for them. That's the bad news for search marketers who use Yahoo!.

Now Google is making AdWords even easier to manage. Formerly, Google disabled ads that got very few clicks, and warned when your ad was in danger of disappearing. Now, Google says that if you get a very low clickthrough rate, you can still get your ad shown ocassionally if you bid high enough. Similarly, if your ad is so relevant that it gets massive clickthrough, you can pay as little as a penny per click (instead of the five cents minimum formerly charged). Chris Sherman has a good review of the changes at Search Engine Watch. The net effect of these AdWords changes is that the per-click bids and clickthrough rates will vary even more than before, and be even harder to plan than they once were. Again, the upside is that your campaign is even easier to manage than before.

Search marketers who use AdWords should pay attention to these changes and be ready to take advantage. If you have low-cost, high click-rate ads, you might be able to reduce your bids below five cents and increase your ROI. If you have low click-rate ads that Google previously disabled, now is the time to experiment with them again.

Posted by mikemoran at 9:19 AM | Comments (0) | TrackBack

July 14, 2005

What Do You Make of the Google Patent?

Google's latest patent filing—for their vaunted ranking algorithm—has been analyzed to death by search experts the last few weeks. Check out the July Biznology Newsletter to see what you need to know. You might be surprised.

Posted by mikemoran at 11:26 PM | Comments (0) | TrackBack

July 7, 2005

What is Happening to Open Directory?

Every search marketing expert will tell you that one of the best things you can do for your site is to submit it to Open Directory (DMOZ), the free directory service whose link to your site is prized by Google and other search engines. A listing in DMOZ is an imprimatur of your site's quality and value. But is DMOZ slipping? Can your new site get the imprimatur it deserves? Recent events call the position of authority DMOZ holds into question.

First, the basics. DMOZ is important mostly because search engines think it is important. Most sites get relatively little traffic crossing the link from DMOZ itself, but because search engines value links from authoritative sites, and DMOZ is considered an authoritative site, a DMOZ link can raise your site's organic search rankings.

And it is free. So why not submit your site? Well, there's no reason not to submit your site, but many submitters are not getting any response. It is not uncommon for sites to wait a year or more before being listed. And submitters are even more upset about the recent move by DMOZ to simply stop status reporting on your submission request. Now, you send it in and you hope for the best.

But there is even more bad press coming the way of DMOZ. Allegations of bribery of DMOZ editors have begun. There is even a blog that regularly regales stories on corruption at DMOZ.

Whether or not the corruption allegations are true, the lack of "freshness" in DMOZ (as search experts like to refer to the slow pace of DMOZ updates) is undeniably the case. The DMOZ submission backlog has been getting worse and that means that the links are less reflective of today's Web—they look more like the Web of 2003 or 2004. Eventually, the search engines will not ignore this.

Search engines place high confidence in DMOZ as an authority because it is perceived as unbiased and up-to-date. The minute that perception of authority begins to erode, because editors are corrupt rather than unbiased, or because the directory is old rather then current, the search engines will begin to devalue the impact of a DMOZ link.

Some observers see signs of a lessening of importance for directories, although no one is saying that the importance of DMOZ is waning yet. But the writing is on the wall. If DMOZ continues to get bad press about its glacial pace of responding to submissions, along with lovely anecdotes about editorial favoritism, expect that the search engines will eventually reduce the importance of its links.

What does this mean to the search marketer? In the short run, not much. If you are already in DMOZ, be happy, but know that you need to be doing many other things to help your organic rankings because DMOZ may not always be as valuable as it is now. If you are not in DMOZ, submit your site. It probably won't do you any good, but it can't hurt. If you are in the long bedraggled line of folks waiting for DMOZ to act on your submission, just hang in there. There's nothing you can do, so spend your time in other ways and hope for the best. If you have heard nothing after a few months, you can try submitting to a different editor if there is a second relevant category for your site.

The short story is that DMOZ is important, but you have lots of things you can do besides getting a DMOZ link. And if DMOZ does not shape up, it will be less important in the future than it is now.

Posted by mikemoran at 10:21 AM | Comments (0) | TrackBack

July 3, 2005

Changes in MSN Search

We've talked before about MSN continuing to innovate in its search offering as it tries to gain share against Google and Yahoo!, but MSN has been especially busy the last few weeks. MSN Search has introduced a new method of relevance ranking, upgraded its local search offering, and introduced a new set of search operators that can be used by search marketers.

Some are saying the new MSN results are incredible. MSN claims improved relevance which it says is due to its use of neural networks. Neural networks are a well-understood way that computers can use a large number of factors to make decisions, while gradually improving decision making by learning (so feedback on the decisions can change the imprortance of the factors). Search relevance ranking has always used hundreds of factors (a Microsoft patent claims 569 factors in their algorithm) and has long used feedback (such as clicks on search results) to rerank the results for the next search. So, some are saying that publicizing "neural networks" is more about marketing than technology. Each of the search engines claims the best relevancy, so search marketers need not be so concerned about who claims what. Pay attention to the search engine popularity numbers—if one of the engines truly satisfies searchers more, then the market will shift and marketers should take notice.

MSN's local search entry looks a lot like its competition from Google and Yahoo!, as it searches yellow page listings and displays telephone numbers and addresses, as well as maps and directions. It has added aerial photographs, but I am not sure how useful they are.

Most folks are focused on the new relevance ranking and local search, but MSN Search has released documentation on new operators as well. For those of you unaware, most search engines have special commands that you can type to request different kinds of results. For example, you can use the "site:" operator in most search engines to see how many pages from a certain domain are included in the search index, as in "site:www.ibm.com" to see how many pages from IBM's Web site are indexed.

MSN has recently added a set of new operators that include some new twists, such as the "contains:" operator that shows pages that contain certain types of files. You can read about the complete list of MSN Search operators along with some tips on how to use multiple operators together. Danny Sullivan has noted that he has had mixed results on how well they have worked, which is unfortunately true in general with search operators—they tend to be poorly documented and not well-supported. But when they work, they can help you do things you can't do any other way. For example, MSN Search is promising an operator that lets you search for pages by the keywords contained within anchor text that links to them.

MSN Search is already a good search engine, and has 15% of the market of all searches. Microsoft is showing its characteristic determination to overtake competitors and time will see if it has its usual success.

Posted by mikemoran at 4:15 PM | Comments (2) | TrackBack