Part Two: Chapter Eight Traffic Building

1. Part Two: Chapter EightTraffic Building “A wealth of information creates a poverty of attention.” Herbert Simon, Designing Organizations for an Information-rich World

2. Value and Scarcity Online

3. Value and Scarcity Online • Volume of online content is growing far faster than the number of Web users

4. Value and Scarcity Online • Volume of online content is growing far faster than the number of Web users • Every site faces unique challenges to attract new visitors

5. Value and Scarcity Online • Volume of online content is growing far faster than the number of Web users • Every site faces unique challenges to attract new visitors • As Web users grow more experienced, they are less likely to explore new sites

6. Value and Scarcity Online • Volume of online content is growing far faster than the number of Web users • Every site faces unique challenges to attract new visitors • As Web users grow more experienced, they are less likely to explore new sites • The true scarcity online: user attention

7. Traffic as Value Value and Scarcity • Value is based on scarcity of supply, not necessarily benefits • While the volume of online material provides ever-increasing value to network users, the the battle for attention is severe

8. Traffic-Building Goals • Basic goal: best traffic at lowest cost • But how to define best traffic?

9. Traffic-Building Goals • Basic goal: best traffic at lowest cost • But how to define best traffic? Maximum Profit Minimum Cost-per-Action Best Traffic with Least Cost Maximize Actions

10. Traffic-Building Goals • Profit guidelines that ignore branding and all other impacts: • Spend on traffic sources that maximize difference between customer lifetime value and web customer acquisition cost • Acquire traffic as long as online customer value exceeds acquisition cost

11. Planning for Maximum Traffic • Drawing more visitors to a site requires a thoughtful web traffic plan • Web traffic plans should consider each of the five main traffic categories:

12. Planning for Maximum Traffic • Drawing more visitors to a site requires a thoughtful web traffic plan • Web traffic plans should consider each of the five main traffic categories: • Branding decisions (e.g. domain name) • Search engine marketing • Affiliate networks • Online banner advertising • Publicity and word of mouth

13. Search & Directory Domain Name/Brand Destination Site External Links Publicity Paid Advertising Traffic as Value Elements of a Web Traffic Plan • Acquiring traffic is expensive • And critical to Web marketing success • First step: make the site easy to find by new users • The steps build on each other

14. Traffic as Value Elements of a Web Traffic Plan • Retaining traffic is profitable • Site loyalty dramatically lowers the cost of maintaining web site traffic • Fewer new users must be attracted to maintain a profitable user base

15. Traffic as Value Elements of a Web Traffic Plan Developing Traffic Requires Value • Visit duration is the online equivalent to time in a store • Long visit duration allows: • More time to communicate the message of the site • Additional opportunities to engage in commerce • More chances to build commitment and loyalty • Exposure to more advertising or alliance partner impression

16. Traffic Through Visibility Traffic Builders: Domain Names • A domain name is the address a customer uses to find your site • Poorly chosen names can hinder success • Once chosen, domain names can be difficult to change without significant expense • A domain name strategy should • Reinforce branding • Build traffic • Anticipate consumer behavior and mistakes

17. Traffic Through Visibility Traffic Builders: Portal Presence • Search engines and directories are common ways to find a company’s web site • Problems • A single search often produces thousands of results • Less than 1 percent of Web pages show up in all four of the most popular search engines

18. Traffic Through Visibility Traffic Builders: Portal Presence • Search engines retrieve pages on the basis of keywords, meta-tags, page titles & other content • Secure a high ranking • Classify your site with proper keywords, descriptors and categories • Make sure important Web pages are listed with all major search engines • Multiple listing is important to ensure exposure, as each search engine will return a different set of results to a query • Work with directories (like Yahoo!) to make sure they properly locate your site

19. Search Engine Optimization • The power of landing “Above the Fold” SOURCE: FPG/Getty Images

20. Search Engine Optimization • Top placement in search returns is key to generating organic Web traffic

21. Search Engine Optimization • Top placement in search returns is key to generating organic Web traffic • User’s willingness to investigate falls sharply as items drop on the return list

22. Search Engine Optimization • Top placement in search returns is key to generating organic Web traffic • User’s willingness to investigate falls sharply as items drop on the return list • Higher click rate on top-rated items • Few users go beyond first page or two

23. Search Engine Optimization • Improving search engine placement • Get indexed on main search engines • Use meta-tags and develop content with appropriate keywords that trigger higher search engine rankings • Structure site content and navigation to reinforce search engine algorithms • Cultivate links from appropriate sites

24. Example – www.pikenet.com (real estate) Traffic Through Visibility The Emergence of Specialized Portals • A specialized portal focuses on a specific industry • Special directories provide editorial control by industry experts, categorization schemes and the ability to reflect rapid change in a particular industry

25. Keyword Advertising • Clickable, text-based ads bring in billions of dollars of ad revenue • Ads steer traffic to an organization web site; fee charged only if click occurs • Competitive bidding process determines a keyword’s value

26. Keyword Advertising • Evaluating keyword portfolios • Identify a site’s most relevant keywords • Test and expand list, based on conversion and click-through rates

27. Keyword Advertising • Evaluating keyword portfolios • Identify a site’s most relevant keywords • Test and expand list, based on conversion and click-through rates • Bidding and tracking • Higher bids increase chance at higher keyword position • No click costs more than maximum bid • Price charged depends on intensity of competition

28. Positive word of mouth and publicity motivate potential users into trial Loyal users are the main source of positive word of mouth Nonusers and disgruntled consumers are more likely to provide negative comments Traffic Through Visibility Electronic Word of Mouth and Diffusion

29. Traffic Through Visibility Net Word-of-Mouth Technologies • E-mail among friends and biz acquaintances • Usenet groups • E-mail listservs • AOL and other online forums • Industry portal discussion areas • Online and traditional media coverage of the Net The Net amplifies the power and accelerates the speed of user feedback

30. Traffic Through Visibility Opinion Leaders Online • Opinion leaders are well-respected industry participants journalists, or lead users known for expertise • Reaching opinion leaders is a key success factor of an e-commerce strategy • Opinion leaders can be reached via e-mail and social networks

31. Traffic Through Visibility URL Placement • Integrate your domain name wherever possible • Manuals, warranties, software programs • Familiar advertising settings • Billboards, buses, bills, company brochures, radio advertisements, public speeches, menus in restaurants, park benches, shopping bags • To track which medium is driving traffic • Use unique identifiers • Use different Web addresses with different media messages

32. Traffic by Association • In traditional advertising, marketers put a company’s message where consumers work, live, play

33. Traffic by Association • In traditional advertising, marketers put a company’s message where consumers work, live, play • Same concept holds true online

34. Traffic by Association • In traditional advertising, marketers put a company’s message where consumers work, live, play • Same concept holds true online • Banner advertising • URL placement on shopping bags, billboards, monthly statements • Sponsorship and co-branding

35. Paying for Traffic Interactive Advertising • Banner ads are the dominant form of online advertising • Clickable graphic images that take a user to another Web location • Pricing is usually based on the number of impressions • Negotiated prices, volume discounts, and barter arrangements are common • Each banner also carries a unique identifier • This allows a business to track the effectiveness of each placement in generating traffic

36. Planning for Valuable Traffic • Effective traffic plans assess the volume and quality of traffic generated • Spotting broad use patterns through visualization tools helps calculate the cost and productivity of new visits • Key tool for traffic-building analysis is cost-per-action: the number of visits that end in a particular action divided by the cost of the campaign

37. Paying for Traffic Online Advertising Effectiveness • Online ad banners are simple to create and implement • Experimentation is cheap and easy • Click-through rates are fairly low • Higher click-through rates associated with: • Bold colors • Top-of-page placement • Animation • Call to action • Limited frequency of exposure

38. Paying for Traffic Brand Building with Banner Ads • Banner click-through rates are often as low as 2 percent • This reduces the effect of online brand building • Many feel that branding still requires the power and imagery of television and radio until users have better technology

39. Paying for Traffic Brand Building with Banner Ads • Paid advertising may be necessary to create the initial visibility to search engines • Several of the search engines use external links to traffic to determine a site’s indexing frequency and placement in result lists • Advertising reinforces the effectiveness of free media • Initial studies indicate that banner ads can help build brand awareness • Even with no click-through, banners can trigger post-exposure visits to sites

40. Paying for Traffic Online Advertising May Not Fit All Companies • Some sites generate sufficient traffic with other measures • If a business has a regional market, it’s best to avoid online advertising on sites with national or international scope • Regional sites, however, may be a great opportunity for online advertising • CitySearch, SideWalk, JustGo, Yahoo!

41. Evaluating Traffic Sources Tracking Search Terms • Important to monitor the top-ranked keywords visitors use to find a site • Provides useful snapshot of the ways visitors remember and categorize a site

42. Evaluating Traffic Sources Measuring the Returns • Measurable sources of traffic include: • Search engines and directories • E-mail promotions • Publicity campaigns aimed at building awareness and trial • Links from newspaper articles and press releases • Dedicated software updates and links • Paid advertising expenditures to steer traffic to the site • Alliances and co-branding to generate traffic from affiliate sites • Web-log and commerce server data enable marketers to measure these sources

43. Traffic Value Evaluating Traffic Sources Measuring the Returns Revenues per Visit and per Page View are quite high

44. Study Question 1 Which of the following is considered to be the greatest scarcity online? • user time • user attention • advertising click-throughs • advertising profits

45. Study Question 2 Which of the following has accounted for the largest growth of online spending in recent years? • search marketing • banner advertising • site sponsorship • subscription fees

46. Study Question 3 The two basic forms of search engine traffic are pay-per-click and which of the following? • Keyword • original • Unified • organic

47. Study Question 4 High search engine rankings can be influenced by the ___________ of external links. • content and rankings • content and advertising • number and content • number and quality

48. Study Question 5 Consumers generally consider what kind of recommendation to be the most credible and persuasive source of information? • search engine • subject expert • traditional media • word of mouth