Smarter SEO beats bigger Adwords budgets

It was just a few years ago we were introducing our sometimes skeptical clients to the cost efficiencies of online search in their marketing mix. It didn’t take long for them to become converts, with conversion rates so much higher than press and radio advertising. It was as simple as buying category keywords prospects were searching for when researching a purchase decision. For one client in particular, a cosmedic company, a Google Adword campaign was delivering sales for under $30 when traditionally they were resigned to having to spend upward of $400 per sale using press ads. Like most things in the world today, things have changed very quickly.

Google Adwords not the cheap fix it once was

While our clients were at the front of the adoption curve, plenty of followers have made online adword campaigns much less cost effective. Google is in the unique position in Australia of having a controlling share of the search engine market. While in Asia players such as MSN offer advertisers alternative places to reach prospects, here 90% of all people who search online use Google. So if you are an advertiser, you are competing with every one of your competitors for the same limited listing in a limitless bidding war. If you want to be on the first page of results, the same words we bought for cents a few years ago can now cost dollars. Our client who used to be able to grab sales conversions for $30 and below would now have to regularly expect to pay $150 or more. Meanwhile, newspapers are doing deals, so the gap for many advertisers is closing again. Or is it? What are the advertisers at the front of the curve doing?

Natural search is the answer to gaining exposure online

At UNO we’ve been delivering our clients what is close to free leads for years now using Search Engine Optimisation (SEO) techniques. How does it work? A Google search page has three sections. Paid results appear across the top and down the right side of the screen. This is what advertisers bid against each other for. Yet research has shown 75% of all people who search on Google ignore the paid ads and click on the results in the third area, the natural or organic listing in the main body of the page.

So while the majority of companies are still competing in a bidding war for 25% of the prospects, smart advertisers are using SEO experts to help them achieve a higher listing in the main game, the natural search listings that you don’t have to keep paying for again and again. Done right, SEO for natural search pays long term dividends.

Here is the news in mass media marketing

A few weeks ago I cancelled my daily newspaper subscription. Not because of the increasing use of bad puns in headlines, a direct result of the publisher subbing out writing to young graduates to lower costs and supposedly bring a youthful feel to the paper. No, I cancelled on the day the business section shrunk to just three pages of mostly superficial stories.

I’m not alone, an associate cancelled his subscription because of the increase in typos and doubling up of stories in different sections.  

While once loyal readers are deserting, publishers are desperately trying to entice. The same paper gave me a free 10-week subscription when I signed up to a wine club the following week. I read online free from the same masthead. Since 2001 the Media Alliance estimates that the number of full-time journalists working on Australian newspapers has fallen by 13 per cent or roughly 1000 to 7500.

The hen and egg question of what came first – the thinness of content or the decrease in advertising to underwrite good journalism, is superseded by the issue of where have the readers gone?

Online, just like you.

The news in the last few months is an indication the tipping point is here…there are lists, (found online in seconds) of the latest closures around the world, from Colorado’s oldest paper, The Rocky Mountain News to The Boston Globe.

PriceWaterhouseCoopers latest survey predicts global newspaper decline of 10.2% this year.

What does the decrease in readership of press mean to mass marketers?

Well there’s no refuge in TV. The diminishing returns of this medium in Australia, where the cost per thousand eyeballs doubled over a seven year period while the number of potential viewers declined by 20% means ever diminishing returns for TV ads.

Yet there are still people who spruik packaged TV ad formats that exclaim “Brand News” on TV is more effective? Than what, bad brand ads on TV? Either way, with fewer viewers for greater expense than ever before, the high cost of entry to producing and running ads on TV are driving marketers away. While a FinReview survey of marketers indicated they are sticking with TV ads for their brand marketing, the long term media spend trends show doing the same as before is on the way out.

Australian online ad spend is up 14 percent to an annual $1.4 billion

The smart marketing investment is micro-managed across dozens of touch points, from the web to activation at point of sale.  The smart marketer is looking for measurable results, insightful strategies and creative that cuts through and adds value in a sea of clutter.

$2M+ of lies to win power

I believe in truth in advertising. So does the commercial TV regulator that demands evidence for any claim you want to make before they give your ad clearance to air. Unfortunately for the voters of NSW, political parties are allowed to say what they want in an ad because they aren't answerable to any of the rules mere brands and businesses have to conform to.

If I made a fraudulent claim for a client in an ad, (for instance the kind of price saving offer mobile phone plans were notorious for before being fined into transparent pricing), the ACCC or ASIC would come after me. This election has seen Labor and unions spend twice the Liberals. Most of that $2,500,000 was on ads that say electricity prices will go up if Baird sells 49% of the poles and wires. It's a lie.

Their ads scream this lie despite ACCC chairman Rod Simms saying this isn't the case. Even the Australian Energy regulator is on record that whoever owns the poles and wires in NSW after the election he will insist they reduce their prices by 20-30% over the next five years. There is no evidence for the claim made in Labor's ads that I believe would have satisfied the broadcast standards that commercial advertisers have to comply with. In fact, there is much historic evidence from previous power privatisations showing prices are lower outside government ownership. This has been acknowledged by such Labor luminaries as Bob Carr, Morris Iemma, Michael Costa and Anna Bligh when they attempted to sell the poles and wires under their governments.

It frustrates me as a professional marketer that in the 21st century political parties of any persuasion can play 1984 mind games with the truth and run them in prime time. The ABC Fact Check merely called Foley's ad pitch "spin". I prefer the robust language of former Labor Energy Minister and ACTU president Martin Ferguson. He says Foley's spin is "rank opportunism and scaremongering... sending a clear message he doesn't care about jobs and energy security."

Politicians' ad claims are officially accountable to... themselves

Here is the law (or lack of) that applies to political advertising as published by adstandards:

"Currently, there is no legal requirement for the content of political advertising to be factually correct. Complainants are advised to raise their concerns with the advertiser directly and/or with their local Member of Parliament."

Maybe we should just ban political advertising, we banned cigarette ads for telling us porkies.

The optimum lengths of social media

People now have short attention spans. So to connect you have to cut through. Keep it honest. Keep it simple. And keep it true to your brand. As for length, keep it short.

Twitter

71 - 100 characters

Posts with 40 characters get 86% more engagement

Google+

25 characters

Facebook

40 characters

Linked In

Posts 16 to 25 words long

Videos

Average length watched is 2.7 minutes

The average customer has an attention span of

How does a brand catch a customer's interest when their attention span is now less than that of a goldfish? I spent a few seconds Googling to discover the average person's attention span has shrunk since 1998, by 11 minutes.

The average attention span today is 8 seconds

The National Center for Biotechnology Information says our attention span is now 1 second less than goldfish. What hope does a brand have to convince us to buy?

Consider a tube of toothpaste. The average main grocery buyer now spends less than 20 minutes in the supermarket for the big weekly shop. With over 10,000 items to choose from it's not surprising when faced with so many options brands are struggling to catch shoppers' interest. At the dental care section 27% of shoppers walk away without making a decision.

You may be aware Australians have never been better educated, the number of university graduates has almost quadrupled since 1986, from 6% to more than 21%. Are we any smarter or better prepared to make purchase decisions?

We are exposed to five times the quantity of information every day than we received 30 years ago, (you may be surprised just how many ads we are exposed to). Yet we have less free time to consider. The Economist explains that time poverty is a wealth syndrome, the more money we have the more we value our time and the more choices we are confronted with to spend that time. At the other extreme, cash strapped people have largely given up trying to decipher so much information, they are influenced by price like never before.

Price is increasingly winning over brand appeal. It's at the heart of the growing success of ALDI – less items to choose from, mostly unbranded, all at lower prices. This has seen their share of grocery sales reach 10%, a big slice of the market brands are mostly missing.

Even brands are struggling to be seen in Woolworths

According to Woolworths own research "more than a third of the items in Woolworths’ supermarket trolleys are purchased on promotion." That's an increase of 10% a year for the last two years.

"Australians hunting for bargains are the big winners, with one in four customers (25%) purchasing nearly half of the food and drinks in their trolley on special."

How do the retailers manipulate the time poor if not with price?

One journalist recently warned shoppers something brand marketers pay dearly for:

• The most expensive brands, or the ones being promoted heavily, will always be on the two shelves that sit between waist and shoulder height.
• Cheaper products are often stocked below knee height.
• Supermarkets know that you may only want milk so put it at the back of the store in the hope you’ll pick up items you don’t need.

Not only are the retailers asking brands for price rebates, Private Label substitutes are also catching once impregnable brands in a pincer movement. So if you believe in protecting the value of your brand you'll probably want to avoid discounting too often. Only the biggest and most desperate can afford to pay Coles and Woolies to be on promotion. In the past sales managers have encouraged the benefits of putting products on promotion to drive sales. Does it still work in the era of short attention spans?

My associates at consumer benchmarking specialists B4P spent a year researching the impact of sales promotions at Point of Purchase (POP). The clients were several of the largest global FMCG companies that are active promoters in Australia's supermarkets, every week of the year. They tested awareness before promotion, cut through in-store, trial, impact on sales and recall several weeks later.

Across all promotion types, (price promotion, competitions, bundled offers and bonuses), shoppers generally don't notice any of it. This is despite multi-million dollar spends on displays, cardboard, posters, banners, gondola ends and shelf strips. Most in-store promotions have become invisible.

Earned and shared media can still gain attention

As we learned over seven years growing Pacific West from a $6million pa frozen seafood minnow to a $38million challenger brand, you can drive shoppers to your product by creating original content to tell your story and social media to spread the word. Just remember your audience has a short attention span. Here is a charming infographic that shows the optimum number of times to post content on social media channels.

Think big, or detail will kill your business

"Look, I said I'd bring you the report on micromanagement,
just give me a minute!"

Stop sweating the small stuff, especially now there's so much of it. New technologies allow us to gather data on just about everything. So it's become accepted practice for marketers and sales to invest in new ways to gather stats and report to senior management. For those of you wondering what's the point, it has now been proven the more a business spends on technology, CRM systems and sales data, the less well it performs in profitable conversions.

The more technology marketers use, the worse the results

Sounds like a contradiction, but the research undertaken by Peter Strohkorb into sales and marketing collaboration in 2013/4, simply proves the more systems teams add the worse the sales results. It's symptomatic of what the authors of Blue Ocean Strategy postulated over a decade ago. A typical strategic plan is usually based on a plethora of research from silos across the business which forces management to dwell on detail. Management becomes paralyzed by information overload.

The businesses that thrive are the ones that step back and look at the big picture using a customer centric view of what could be possible. Here's how it works.

Focus on the big picture to create a Blue Ocean Strategy

With a Blue Ocean strategy, you can implement a clear brand building campaign

We've found time and again, once clients re-visit what they can be, the task of growing the business becomes clear. Our methods to help create clear differentiation set the business up for challenger brand growth. With a single minded compelling tag line that sets them apart, big picture thinking helps refresh the business. There is new enthusiasm we harness to recreate the brand and relaunch. The way is now clear to become a price setter, not taker and drive sales conversions.

See some of the ways a refreshed brand can improve profitability.

For a nation of gamblers we're marketing risk averse

The companies that rated best for effective marketing, according to a recent Gartner study, were the ones that spent the most time understanding their customers. Businesses that are introspective and fearful of action will lose sales to those actively talking to customers and prospects. 

How do you guarantee marketing success?

Jan-Patrick Schmitz, CEO of Montblanc North America, says "it obviously starts with the CEO. If he or she doesn’t understand that the business is about the customer and not operations, the CMO is going to have an uphill battle. Understanding your customer is about understanding what your business is and what your business will grow into.”

It's not a lottery, once you understand what customers want from your product or service, marketers that advocate for the customer in the boardroom will win.

Get the message right, then the risks are reduced irrespective of the mediums you then try. If you do understand your customers true needs and what they value most, and built your offer to satisfy those desires, it's time to check out the latest ways to advertise and connect.

Aussie business struggles, time for a creative way out

Will our kids ever be able to afford to buy a house? Can they even afford to rent? Here in Woolloomooloo 2 bed flats start at $1,000 a week, unfurnished! Unemployment is on the way up, mining investment on the way down. Coles and Woolies continue to squeeze farmers and FMCG brands while bricks and mortar retail is flat.

The big 4 banks are making record profits on higher margins than ever. If you are a small to medium business they probably won't give you a loan. 20 years ago 75% of bank lending was to business, now 75% goes to funding ballooning house prices.

This chart shows the decline in business investment post GFC

If businesses aren't investing in themselves, how can they grow let alone survive as the Internet destroys traditional business models?

Most managers have spent the last 6 years cutting and seeking efficiencies, hoping if they hang on long enough the market will recover. While local businesses seem to think it's conditions that are tough, World Bank figures show the world is booming – output was up $US75 trillion last year, which is about 20 per cent higher than the pre-GFC peak.

The world is moving on

Australians need to look outwards and recognise there isn't going to be a return to the way things were, the new reality is more rapid change and creative destruction. I use the word creative discerningly. It's the best way to describe the increasingly global competitive situation most businesses are struggling to get their heads around.

Historically change came slowly and could be managed by gradual adjustments of pricing, distribution or inputs. Not any more.

Enabled by the Internet, we now have Google replacing entire distribution channels with a search box. The Cloud has enabled brands such as Xero to offer with a lower cost and better service to leapfrog long established businesses like MYOB that relied on annual software upgrades. Social media has empowered determined consumers to "out" entrenched self-serving business practices, just look at CommBank's conflicted financial advice scandal that could cost it over $100million. (Or ANZ's Timbercorp scam and Macquarie's financial planners rort.)

These are all examples of a new business environment. New challenges require new thinking. A survey of over 300,0000 managers published by Harvard Business Review shows both CEOs and the next 3 levels of management aren't equipped to think outside the square.

The most important skills as rated by managers

Perhaps the skills that are most needed today to deal with the rapid pace of change are the ones required to find creative ways to refresh and relaunch a business. Yet the survey found these are the least valued by management. Can you imagine how the people behind some of Australia's most successful businesses would rank themselves for the skills on the list? Like the young pair behind Atlassian, ten years ago a start up now worth $3.5billion. Or Boost Juice, Cochlear or Challenger, Seek or Xero. How important to their success are the more creative skills most managers in the survey dismiss?

Creative thinking skills

Innovates

Champions change

Connects the group to the outside world

Establishes stretch goals

Practices self-development

You may be interested to see evidence of how creative thinking adds value in this time of digital disruption. UNO helps challenger brands grow by encouraging and mentoring these creative skills that most managers have underutilised. Download our formula for growing challenger brands here.

UNO's one time client at Choice Christopher Zinn explains more on the new influence of the determined consumer. 

Want to see where marketing is headed?

Technology is changing everything in our world. Marketing isn't just following the trends, today marketers are actually more likely to be using new technologies to drive change within businesses than the IT department.

I wrote recently that Gartner has found the average CMO now spends more on IT than the CIO. It's all about understanding what the customer wants, then finding what technology can now do to give it to them.

Big Data driven future for marketers

Here is a chart I came across that helps explain where we are today and where we are heading. Sooner rather than later.

Just click for a bigger view of the future of marketing.

Want a strong brand? Here's one we prepared earlier

What's in a brand name?

Money in the bank if you choose the right one, or an uphill battle and wasted dollars if you get it wrong.

Your business is your baby, and just like your first child, choosing a name can be fraught. Rather than show stats or a share a list of "most popular brand names of 2014" or cherry picked research to explain the pros and cons of what makes a good brand, I'm going to share 30+ years of trial and error and what it's shown me actually works in the real world. Not just what sounds good when shared with your spouse when working through the choices lying in bed late at night.

How a brand name change delievered a 3000% return

City Mutual had been around for over 100 years, yet onlythan 2 in 100 Australians recognised it. Three years later it was the best known investment and insurance group after AMP, having changed it's name to Capita.

Buying IBM means you won't get fired

Managers for decades have filled tenders, often at higher prices, knowing the board would never question the decision. Every time a client comes to me saying they want to call their business a series of initials they quickly use IBM as an example of why it will work. You can forgive their missunderstanding of what makes a brand. Unless your over 100 years of age you would necessarily know International Business Machines gained it's reputation for deivering reliable and ofte leading edge typewriters and for fifty years before it abreviated it's name to the initials that sat kneatly in the corner of millions of machines in office desks around the world. Today they business is in consulting, so Business Machines wouldn't be apt.

How to make a splash

Local businesses need to think of global consequences

When IFX Markets, a UK listed financial services business wanted to test market a business model in Australia for global roll out, the question of the right name came up very early in discussions.

Have Aussies forgotten how to make things?

If you're anything like me, you enjoy a weekend trip to Bunnings. Today there are more things to buy than ever, for less than when our fathers took us to the local hardware decades ago. Where once tools and taps and barrows and bolts were manufactured in Australia, most of this stuff is made in China.

Most of us would agree Australia's manufacturing sector has been destroyed by cheap Chinese imports. What hope is there for Australian made? With the help of some lateral thinking, maybe more than most think.

The end of the made in China boom?

Robert Gottliebsen reports China's remarkable gains in productivity and standards of living were all achieved with borrowed capital and technology. Alan Greenspan points out that no Chinese companies feature on the annual lists of the world's most innovative companies -- nearly half of those lists are made up of American companies. This is leading to a narrowing productivity gap between China and the US, which is putting serious pressure on the Chinese economy.

That's right, don't underestimate the power of first world creative thinking when matched against the cheap cost of third world manual labour. Here are a couple of examples from my dealings over the last year.

Australia leads the world in compression fabric design

I remember twenty years ago most Australian clothing manufacturers closed their local factories and set up workshops in Fiji where labour was cheap. Now most clothes sold here, even in stores like Zara, are made in China or Pakistan by one suspects slave labour. Yet in some areas of fashion we continue to lead the world.

Our client Quick Response is a local family business of almost 20 years who are still designing and making swimwear and compression garments locally. What's more, they manufacture using Australian made fabric.

In fact Australian compression fabric is the most technologically advanced in the world. It's the result of research and innovation that over the years has been tried and tested by our champion swimmers in those body hugging suits.

UNO have built an e-commerce site so you can buy the world's-best QRS compression garments direct, for less than sports brands that are usually made in China and Indonesian from inferior fabric.

Still open: a local manufacturer of timber shutters

Thirteen years ago Open Shutters was one of UNO's foundation clients. While cheap Chinese shutters have decimated most local manufacturers, Open continue to do business by concentrating on innovation. An obsession with quality design, investing in advanced machinery and only using sustainable timbers continues set them apart.

While white paint may disguise the compromises of Chinese made shutters in the short term, having been in the market now for several years they are proving to peel, bow, crack and break. The fact Open's product is built to last sees them gaining repeat sales over two decades on. What really makes the biggest difference is the way Open think:

What truly lifts them to the top of their category in the world is the design thinking process they apply in everything they do. When suppliers tell local architects or designers their ideas aren't possible, Open finds a creative way to deliver.

Could robots save Australian manufacturing

If you still doubt the power of creative thinking over cheap labour, consider this. Last year McKinsey released a list of the things that would change the business world. Near the top of the list was advanced robotics: robots with better and better senses, dexterity and intelligence that can automate tasks or help humans or even operate on us more effectively than... humans.

To quote the numbers:
• 170%: growth in sales of industrial robots 2009-2011,
• 320 million: manufacturing workers (12% of global workforce), and
• $2-3 million: cost of the 250 million annual major surgeries.

Here's what robots could do:
"Advances could make it practical to substitute robots for human labor in more manufacturing tasks, as well as in a growing number of service jobs, such as cleaning and maintenance. This technology could also enable new types of surgical robots."

Closer to home, when I underwent keyhole surgery a few months back, I could have chosen to be operated on by a robot designed in the US for remote controlled surgery on the battlefield. My gap cover wasn't enough to cover the extra cost, but the cost gap will quickly close. It's another reminder the changes in our lives will more likely be shaped by innovation than the global oversupply of cheap labour.

If you are a manufacturer the message is clear, forget cost cutting, start thinking and get marketing.

Read more on how to rethink your business.

Perception or Reality? Customers now decide

Over 50% of people don’t trust financial advisers. So I was told on the news last night. If you have ever been to see an advisor you’ve probably come away with the perception that they aren’t telling you everything straight. Commbank’s multi-million dollar financial planning scandal has proved perception IS reality when it comes to advisors.

For decades when a business advertises a product, whether baked beans or an investment, the words and claims made are open to scrutiny and have to be THE TRUTH. You have to deliver on the promise or you are liable under a number of ad standards, ASIC and ACCC rules. If you sell a financial product face-to-face most of these rules don’t seem to apply or be enforced.

Big 4 Banks still traditional marketers

What the big 4 banks and AMP have got away with is a classic exercise in traditional marketing methodology – control the distribution channel and you control both pricing and product. By using different brands they have been able to sell the same products to an unsuspecting public. Most people haven't realised 80% of advisors work for groups owned or aligned with just 5 product providers. 

Most people think they are seeking financial advice, when what they are getting is a sales pitch. How can anyone be given genuine choice when of 18,000 advisors only 31 are truly independent? We’ve all been buying Home Brand super for years and haven’t known it. Here is a list of just some of the hundreds of “brands” just 5 providers have sold their own products under:

Cavendish  AMP

Charter Financial Planning  AMP

Garrisons AMP

Genesys  AMP

Hillross Financial Planning AMP

Ipac AMP

Avanteos  Commonwealth Bank

Colonial First State  Commonwealth Bank

Commonwealth Financial Planning Commonwealth Bank

Count Financial  Commonwealth Bank

Financial Wisdom  Commonwealth Bank

Witaker McNaught  Commonwealth Bank

Apogee  NAB

Garvan Financial Planning  NAB

Godfrey Pembroke  NAB

Lend Lease Financial Planning  NAB

Meritum Financial  NAB

MLC  NAB

Elders Financial Planning  ANZ

Financial Services Partners  ANZ

Millenium3 ANZ

OnePath  ANZ

RI Advice (RetireInvest) ANZ 

Sentry  ANZ

Asgard   Westpac

BT  Westpac

Pact Accountants Investment Group  Westpac

KPMG Financial Planning   Westpac

Securitor Financial Group  Westpac

A couple of rogue CommBank advisors who ripped off investors for millions is just the tip of the iceberg of poor brand values. Ian Narev says the business won’t suffer. I suggest the era of brand equity built upon decades of million dollar perception-shaping advertising is over. The Internet has democratised the share of mind of customers. Does Narev not understand this? Instead of changing his business model he returned from holidays to push the button on a million+ dollar ad campaign trying to reassure customers they are fixing things. This old school reaction won't preserve brand equity long term. Here’s proof.

Try Googling CommBank financial planner. This is the result I got:

Last week we saw the government roll back the FoFA laws that were supposed to make hidden and trailing commissions illegal. Despite some wordy amendments from Clive Palmer, there is still no ironclad law that insists advisors can’t sell you a product because they get a kickback, not because it’s the very best choice for you.

Challenger brands will win with customer centric marketing

Legislation may not stop the consumer unfriendly practices of big banks. Social media and the empowered consumer will. And new technologies will see challenger brands that build financial product and service offers around what customers actually want will grow at their expense. Coles new deal with GE Capital to offer loans is just the start. I'll leave the last word to a consumer active on social media: