January 2010 – Column: Your Association, Your Bottom Line

Issues Arise as Guides Take Effect

It’s been just over one month since the FTC’s revised Guides Concerning Endorsements and Testimonials in Advertising have taken effect. In order to ease the transition to the new standards, ERA recently hosted two Spotlight Sessions on the revised Guides, assembling panels comprised of FTC representatives, leading legal experts and marketers to address the real-world issues that have emerged.

Both sessions made it abundantly clear that there’s a lack of clarity for many marketers regarding the Guides, causing an immediate and significant impact on the businesses of many ERA member companies and others in direct-to-consumer commerce.

To help settle the confusion and provide actionable advice for ERA Members implementing the changes set forth in the revised Guides, here are a few of the key takeaways:

Network clearance issues are already arising. Shows are already being blocked for failing to satisfy the Guides. According to Product Partners, LLC’s Jonathan Gelfand, the problems lie not with the Guides themselves, but with networks’ misinterpretation or excessively conservative reading of the Guides. Gelfand called for further clarification from the FTC to provide additional guidance to the stations and networks. I urge you to bring these issues to ERA’s attention as they occur; we will compile these accounts and present them to the FTC to urge the Commission to provide clarification regarding the exact language of the Guides that is proving to be problematic in execution.

Regarding social media marketing, have a plan. Social media marketing will only grow and increase in effectiveness as more marketers harness the power of their consumer base, influential bloggers and others to spread their message. But as the FTC’s assistant director Rich Cleland stresses, you must have a reasonable social media policy and monitoring program in place. The FTC acknowledges that complete control over your social media agents is impossible; you simply need to have policies in place and take reasonable steps to monitor your agents and enforce the policies.

With celebrity endorsers, know when to disclose. In the context of an ad, it’s assumed that celebrity endorsers are being compensated, so no disclosure is required. Outside of this context, however, disclosure of the connection between the celebrity and the marketer is likely to be required should a discussion turn to the celebrity’s use of your product.

The FTC has clear priorities in social media. High on the FTC’s enforcement list? Fake blogs or “flogs,” phony product review sites and “astroturfing”—enlisting agents or company employees to post positive reviews about your products or negative ones regarding your competitors’ without disclosing their connection to your company. Inadvertent mistakes where a social media agent has “gone off the reservation” in speaking about your product without your knowledge and despite your social media policy? Not a priority.

Clarification is on the way. Look for the FTC to publish FAQs regarding the revised Guides soon. In addition, ERA, as your association of record, will continue to provide guidance to our members. Specifically, I urge you to attend The Great Ideas Summit (held Feb. 1-3 at the Hilton New Orleans Riverside) where keynote speakers (including David Vladeck, director of the FTC’s Bureau of Consumer Protection) and educational sessions will address the topic in detail. For more information, please visit www.eragreatideas.org.

I look forward to your thoughts and concerns on this issue. Please contact me at any time at jcoons@retailing.org. I look forward to seeing you in New Orleans!

January 2010 – Feature: The Big Deal

Brad Wilson, Founder and Editor-in-Chief of BradsDeals.com, Shines a Light on Superaffiliates and the Growth Opportunities that Await Retailers and Marketers.

By Vitisia Paynich

In 2001, Brad Wilson was just your typical undergrad college student trying to make it through when he decided to launch an online business called BradsDeals.com. Little did he know at the time that his venture would not only make him a major player in the affiliate marketing space, but also transform him into a sought-after online shopping expert. In fact, Wilson has appeared on such programs as the “Today Show,” “Oprah & Friends,” MSNBC” and “CNN Money,” as well as in publications like The Wall Street Journal and USA Today.

It’s no wonder that ERA asked the founder and editor-in-chief of BradsDeals.com to speak at the Affiliate Marketing: From the Front Lines session on February 2 at The Great Ideas Summit in New Orleans. Electronic Retailer sat down with Wilson to learn more about how BradsDeals.com has garnered superaffiliate status and why affiliate marketing is a low-risk investment.

Electronic Retailer: How did you enter into this business?

Brad Wilson: I started as a poor college student and I was able to find great deals on all the stuff I needed for school. I started BradsDeals for fun to help show my friends and fellow students how to get the same deals. It’s been about seven years since I launched the company.

ER: How did you evolve into a superaffiliate?

Wilson: I think it was just by keeping that same approach of doing a lot of work and research as if I was doing it for my friends and families still. And eventually, being able to spread the word to a lot more people. That focus on our audience and what they need in a very long-term way is what has helped us get to the point that we are at right now. And I think that’s paid off in a sense that we’ve developed a very loyal following.

ER: Were you surprised by how your company has progressed, or did you know from the get-go that this was something that was going to really take off?

Wilson: Absolutely not. I was very fortunate in the sense that I was in school so I didn’t really need to make the business work for a long time; I had a lot of runway. I could just do it for fun and I didn’t need to use it to support myself [financially]. So, if I had to make it work out of the gate, it wouldn’t have worked. And, I think I’m pretty lucky in that sense.

The team at BradsDeals.com hand picks the products that they deem to be the best deals for consumers.

ER: To get a better understanding of just how much revenue a site like yours can generate for a marketer, could you please provide some revenue statistics?

Wilson: Every product on BradsDeals is sorted by popularity based on what our audience’s reactions have been to it in recent history. And things that are up pretty high have a good potential of driving a fair amount of sales to retailers. With the right deal, we can generate $50,000 to $100,000 in gross sales pretty easily.

ER: What do you generally look for in a marketer?

Wilson: It’s funny because I still get a ton of e-mails from people who are inquiring about what kind of data feed we’re using when it’s very obvious that everything we’re doing is hand-picked. It says: posted by Brad at x time of day. Those people don’t scratch the surface enough to realize that before they contact me. We need people who understand what we do and understand our business. The best relationships we have are with people who can really facilitate that. An example would be a store that we can go to and say, “Here are five products that we really like and that our audience would like at a better price. You’re selling them for $100, why don’t we set up a page on your site where they can sell for $79.99? Or, why don’t you give us a coupon code for $25 off these five products for the next 48 hours?” Now a) there has to be an interest level; b) logistically, they would have to be able to do it; c) they have to trust us and like our audience; and d) they have to think we’re adding value to the process. Those are the kind of relationships that we’re looking for.

ER: What type of compensation arrangements do superaffiliates tend to command?

Wilson: It has a lot to do with what kind of value the affiliate is bringing to the table. It’s really on a case-by-case basis from a retailer’s standpoint. If you’re doing something with a really high-value add and you’re reaching an audience that the retailer couldn’t reach themselves, then I think you usually can come to good terms with the retailer. It has to do with the margins. There are plenty of times where we’ll forego a higher compensation to get a better deal for our readers.

On the flip side, a retailer might not feel like they’re receiving quite the same value from big affiliates. And, if they feel that way, then they’re not going to compensate them the same. For example, maybe a retailer doesn’t think that they’re really getting exposed to any new customers by those people; maybe the retailer thinks that they’re just churning the same customer base that they always have and are offering cash back. You’re not really adding value to a retailer or helping highlight the positive attributes of a retailer simply by giving someone cash back on purchases at that store. So, there are all kinds of different scenarios where a retailer might or might not see value.

ER: So, there is flexibility in offering different types of compensation packages, depending on the size of the retailer?

Wilson: Yes, that’s exactly right. [In December], we did 12 days of holiday giveaways. And each day, a different retailer offered a pretty substantial giveaway. Dell, for example, gave away four notebooks in one day, which cost them somewhere between $1,200 and $2,000. So, if that hadn’t been a part of our conversations with Dell, maybe we could have gotten better compensation from Dell. But we ">preferred to take this time of year to give back to our readers and do something interesting and fun, and I think Dell understood that pretty well, too.

ER: What makes some marketers more successful than others? Is it the product? The offer? Or, is it about supplying the affiliate with killer and fresh creative?

Wilson: It depends on what the affiliate specializes in. In our case, it’s about the product and how compelling the offer is to consumers. The rest of the information, content, images and data are all something that we pull together personally and not in an automated kind of way or with anything that’s provided by the retailer.

ER: Could you offer some tips for selecting a network?

Wilson: Selecting a network has a lot to do with your particular needs and budget. If I were a small, startup retailer with a different marketing budget, my choice would be a lot different than if I were Target. And my choices if I were Target might be different than if I were Pottery Barn–just because there are different brand issues and concerns with the two of them. I think it runs the gamut a little bit.

ER: What tips could you offer for working with a superaffiliate and managing that relationship?

Wilson: The biggest thing for managing a relationship with an affiliate is to understand their specific needs–to go that extra mile. We’ve seen that pay off year after year with some of relationships with people who really try to understand what we’re doing. And it makes all the difference in the world, because they can really get in there, facilitate and work with us, be creative and come up with good ideas.

ER: How can you make sure to avoid conflict between the marketer and affiliate with regard to pay-per-click? In other words, how could you avoid both bidding on branded terms and essentially competing against another?

Wilson: It comes down to the marketer or the retailer clearly establishing a set of policies and making sure everyone follows them. If they do that, chances are they’re going to have very few problems. And, any affiliate that is worth having a relationship with isn’t going to cause problems if there’s a clearly established policy.

As far as bidding on branded terms, it depends on the needs of the retailer. For example, maybe the retailer has a very generic name and while bidding on that name discovers there are nine competitors. In that case, the retailer is probably best served by letting their affiliates bid as well to flood the page a little bit so that they get as much coverage as possible, especially because the retailer can only show up once on their own. So, it just depends on what the retailer wants and ultimately, it’s up to the retailer to communicate and enforce their policy.

ER: What are the overall benefits of engaging in an affiliate marketing program?

Wilson: The economics of this business are really positive for retailers. What’s clear about the affiliate relationship is that you don’t have anything to lose. You can create something that works for you, works for the affiliate, and it doesn’t cost you anything. So you get exactly what you want in return.

In our case, it’s really a triangle of mutual benefits where we create a very compelling consumer offer, the retailer gets sales and traffic and then there’s something for us as well. Let’s say a retailer has a 20-percent gross margin. Then they can come up with a 10-percent-off coupon or 10-percent-off discount on a product and then pay the affiliate 5 percent. In that case, the retailer knows in advance that if any transaction happens with their affiliates, they’re going to net 5 percent. You can’t get that kind of precision or guarantee with any other kind of marketing or advertising. I think that oftentimes retailers who aren’t too involved in this to be hesitant, but I think that quick economic analysis is simple enough to make them realize that it is a very safe scenario for them.

And during these past 18 months, we’ve seen a lot of retailers actually shifting their energy, team and budgets more towards the affiliate space for that same reason. Assuming they know what they’re doing, the return that they’re going to see will be a positive one and it’s just very low risk, which is interesting because there are not too many things on the Internet that are low risk.

January 2010: Cover Story: Monster Ideas

E-Commerce Guru and Serial Entrepreneur Jeff Taylor on Cultivating and Driving Ideas Forward in the Social Media Age

By Tom Dellner

Jeff Taylor’s perspective on entrepreneurship, e-commerce and social media is as unique as it is hard-earned. He was one of the earliest–and most successful–e-commerce pioneers, founding Monster.com in 1993 and selling it in 1995 for $900,000. He has led companies that employ many thousands and others with a total workforce of a dozen. He not only launches companies, he has forged trails into the business wilderness–Monster.com was the first online jobs site, Eons.com is a one-of-a-kind social network for Baby Boomers and Tributes.com is a trailblazing online obituary and memorial site.

But don’t pigeonhole Taylor as all business. He has a multitude of interests, with music ranking near the top. In fact, the not-quite-50-year-old is an in-demand DJ in New England (playing techno or house music) and has a weekly radio show on Sirius called Jeffr Tale.

Electronic Retailer sat down with Taylor for a free-flowing, stream-of-consciousness conversation regarding the hallmarks of successful entrepreneurship, e-commerce and the futility of resisting social media.

Electronic Retailer: You often speak to groups regarding entrepreneurship. How would you define “entrepreneur”? Is entrepreneurship a learned skill, or is it something more innate?

Jeff Taylor: My definition of an entrepreneur is when everyone around you thinks you’re crazy and yet you’re still convinced you have a good idea–and you act on it. I am definitely an entrepreneur, by this or any other definition.

I’m often asked whether this “trait” is learned or developed. For me, I suppose it was a little of both. I was shy in high school, not in the “in” crowd. I did, however, have a bit of an innovative upbringing with parents who were very liberal and very open with me, which I believe gave me some good clues about being a self starter, but this didn’t blossom for me until later in life (parenthetically, I believe this can be an advantage; it can be very difficult for the high school quarterback or head cheerleader to duplicate those big highs as they enter adulthood).

But I sincerely believe that the skill of driving an idea forward can be developed as a practice in your life. It’s something we all need to master. It can be something as small as deciding to have lamb for dinner instead of chicken again. But you then have to follow through on it. These small victories can build up over time and give you the vision, courage and will to develop and drive forward bigger and bigger ideas.

And having an idea that’s worth its weight is a lonely experience. You’ve thought of something that no one else has, or maybe you’re just the one who wants it the most. As a result, almost everyone else will say it won’t work. And I firmly believe that those closest to you are going to be the ones that are the hardest on you. If you measure yourself by this local feedback, then you’ll just stop working on ideas.

Eons.com has broken new ground, turning Baby Boomers into active social media participants.

ER: Getting a company and an idea up and running is hard, but so is maintaining success. How do you keep momentum building once you’ve achieved some initial success?

Taylor: When your current business hits its stride and begins to do well, that’s the time to begin a longer-term–or “second curve”–strategy. It’s very difficult to do, because as your product becomes profitable, all you want to do is keep your foot on the accelerator. It feels like a distraction to be thinking about changing your product or creating a situation where you might cannibalize your own product. But I think you need to seek out these situations; go to those sources. If you don’t do it, your competitor will.

I also believe the second curve should be managed by a separate group and that I, as CEO, should attach myself to this group, delegating my duties regarding the first curve. It’s the role of a fast-moving CEO to keep giving his job away and to keep re-inventing a new job.

ER: Can you offer any other tips for keeping one’s company vital and healthy?

Taylor: Hiring great people is absolutely crucial, but there’s more to it than that. You, as a business leader, need to force yourself to do an honest assessment of your own personality and skillset and hire into your weaknesses. It’s very difficult for many executives to identify their weaknesses. I’m fortunate–mine are glaring!

There are two other areas where you need to build out your skillset as an entrepreneur–either your own skillset or those of your employees. One is culture. As a CEO, I think you own that. Culture, as I see it, is the natural state of employee morale. There’s too much of a mindset today of the leader getting the idea up and running and then retreating to his office and not remaining engaged with his or her employees. That’s very dangerous. I believe that the culture and the founder or CEO are attached at the hip. But inevitably, as a company grows, the CEO transitions from being a people-oriented person, curious about employees’ lives, to being a person who motivates the 10 or 15 people at the center of the organization and teaching them those skills about having curiosity about their people.

Also, the way you market and brand the company is key, and I believe it should start with the founder or CEO. Being able to speak with clients–or importantly, with larger groups and audiences–about the expertise that you’re developing, without it being strictly an advertisement about your company, is crucial. It’s a way to stay close to your original ideas and motivations, and it operates as a powerful, more consultative promotional or sales tool. It also forces you to keep advancing your knowledge level in your subject area, which is crucial to your company’s success.

ER: Can you identify for us some of the key learnings you’ve taken away from the three companies you’ve founded: Monster.com, Eons.com and Tributes.com?

Taylor: At Monster, I learned the importance of naming a company. Everyone, from my wife, to my biggest client at my firm at the time, to all my employees and anyone else I tried it out on–no one liked the name. But I had the conviction to go with my gut. Monster is a descriptor that means “bigger than big.” And once we launched, after I explained to enough people that “monster” also equals “jobs,” that name helped protect our brand position and marketshare in a competitive space for more than 10 years.

Eons has taught me about marketing to Boomers. I’ve learned that the older we get, the more individual we become. It’s been an exercise in herding cats to get a group that’s known for rebelliousness and going their own way to come together en masse in a community–I’m still trying to crack that code. We have more than 800,000 registered users and about a half-million unique visitors each month, but compared to Facebook with its 300 million users worldwide, we still have a lot of work to do.

With Tributes, I have a challenge–similar to the one we initially faced at Monster–in instigating a behavior change. People have been placing obituaries solely in the newspaper for 150 years. In addition, the funeral home industry is one that is rather suspect of new entrants and of technology, so I am learning every day how to introduce change in an area that is very set in its behaviors and resistant to change. We’re now the largest company for placing national and local obituaries online, but have many challenges in front of us.

It’s daunting and somewhat humbling to realize that I’ve been responsible in migrating two of the newspaper industry’s biggest sources of revenue–job and obituary listings–from the classified section to online.

ER: With your unique perspective on social media, how might you advise the direct-to-consumer retail industry regarding entering the social space?

Taylor: Two adages leap to mind. First, you’ve got to be in it to win it. The second is a Woody Allen quotation, “Seventy percent of success in life is showing up.” You simply can’t learn about social media as an observer.

Also, one of the very key elements of social media is what’s known as one’s “social graph.” Once you have your Facebook page, your LinkedIn page, your Twitter page, your blog and your iPhone apps all tuned into and pointing toward the same place, you can start to mine all the customer data and IP that comes from the conversations and activity in terms of traffic building that comes from this social graph.

This explicit knowledge of your target audience and all of the associated behavioral data is invaluable. You can then begin to identify and connect with the key influencers, active consumers and influential bloggers and begin to spread the word about your idea or your company or your brand. And all of this comes out of your social media participation fairly naturally.

For example, just deciding on a persona or profile of your company forces some productive and eye-opening discussion. What kind of person is your company? You might react with a “yikes.”

There are barriers you need to push through. You need to be willing to ask customers questions and actually listen to their answers. You have give your customers a chance to engage and tell their stories about your product. “What happens when they don’t like your product?” you’ll ask yourself. But you have to trust that, if you’re doing things correctly, for every one of these customers, there are 10 others that will jump in to your defense. It can be scary.

It’s essentially a new business model. We’re familiar with B-to-B and B-to-C. But social media introduces C-to-C–it’s unorthodox, but it’s also really exciting and with almost limitless potential. You have to trust your customers to co-develop with you, but if you can enlist your consumers as your sales force, it’s fantastic.

Tributes.com is now the leading obituary and memorial source online.

ER: Where do you see social media heading over the next few years?

Taylor: The Internet started out with a closed network; this wave of communication was mainframe, with AOL, CompuServe and Prodigy as the major players. Then we transitioned to an era where open, web-centric properties dominated the landscape–companies such as Amazon, eBay and Monster, among others.

Next, after the dotcom boom collapsed, you had the emergence of Google and a re-confidencing (if I can coin a term) in the Internet–people began to believe again that it was a truly viable playing field for commerce.

Now, we’re seeing the explosion of more and more closed networks: MySpace, Facebook, Twitter, etc. For the younger generation especially, most of their communication occurs within these closed networks.

I think what we’ll see next is an opening up of these closed networks one more time, with the opportunity for the corporate world to join in the conversation and realize that it’s really about people. It’s not going to be about selling product with an advertisement, but how you create value and how that value and message is distributed.

I honestly believe that we’re working toward an era of haves and have not’s, with the haves being those who understand social and the have not’s being those who do not.

ER: Is it key for senior leadership to engage in social media?

Taylor: I can’t stress enough the importance for the leaders in a corporation to participate–even if only on a personal level–in social media and to learn the benefits and advantages of having a position of strength on any social platform. Otherwise, you’ll create a scenario where the marketing person is running the social media strategies for senior management. And that doesn’t work. As a corporate leader, how are you going to get to the new ideas if you’re not experiencing social media yourself?

ER: Are there any risks associated with an increased emphasis on social media, and online marketing in general?

Taylor: With the growth of the Internet and other “accountable” business platforms, I think there’s a real risk in letting quantitative analysis assume too large a role within your company. There’s this idea that your analytics, your data, tells all: you can’t do anything from the gut; everything has to quantitatively “add up.” But it’s your brand positioning that gives your company the emotive qualities that allows it to take on a personality–which is essential to taking full advantage of today’s (and tomorrow’s) social media-driven marketing. Having a completely quant-driven strategy will cause you to come up short in brand position, brand voice, brand attitude and brand power.

ER: Do you have any pragmatic advice for entering the social media fray?

Taylor: I would focus very hard on recruiting. The technology really has to be understood and leveraged correctly in order to master social media and you need the right talent. Relying on the team you’ve had for the last 10 years may not be the answer.

Secondly, I would limit your initial projects to those of a smaller, more manageable size. And technologically speaking, cluster small server boxes instead of using big boxes. Use open-source instead of proprietary technology. This allows you to let the leading developers in these emerging areas to step right in and use–and build on–these technologies.

ER: Any last words of advice to traditional direct marketers who haven’t fully embraced online marketing and social media?

Taylor: I would suggest starting to shift some media from traditional channels to Internet platforms. You don’t have to shift it all at once. And the beauty of it is that the measurement is so good, the quantitative elements are so well-established, that the ability to test and experiment and then press down on the levers that are working is already there. Just as in real estate, the web is “location, location, location” and you need to find the locations on the web that are going to work for you–and it’ll be different for every company.

But the reality of it reminds me of how our parents all hoped they could get out of the workforce without having to use a computer. There is just no way that traditional direct marketers today are going to be able to get out of their jobs and retire without learning how to master social media. But the good news is that the transition can be gradual, transformative and exhilarating.

December 2009 – Channel Crossing: Online

Four Ways to Capture Attention Using Online Coupons

By Christian Gordun

Now more than ever, frugality has become the standard for many consumers looking to rid themselves of bad spending habits. In fact, a recent survey commissioned by Coupon Craze and conducted by Harris Interactive found that 94 percent of all adults have used a coupon to make a purchase. The survey revealed that the most frequent online shoppers are affluent, educated and may be getting frustrated with negative experiences incurred with faulty or invalid coupon codes. This means that these ideal online customers may be generating a negative sentiment toward your brand without your knowledge.

Following are some statistics every marketer should know, and suggested tactics for leveraging online coupons to capture your customers’ attention and avoid shopping-cart abandonment.

• Who is shopping online: Adults with a household income of $75,000 or more are more likely to shop online than those who have a total household income of less than $35,000 (93 percent vs. 82 percent, respectively).

• Why they are getting frustrated: Ninety-four percent of online shoppers have had an expired or invalid online coupon code.

KEYS TO GETTING RESULTS
1 Control your brand: Several of the top websites let users share and post coupons. This means that expired coupons, which lead to consumer frustration and cart abandonment, are often passed around without your approval. To fix this problem, I suggest scanning coupon sites to make sure all coupon codes available to online shoppers are valid and beneficial to your business. Then, make sure that you have relationships with the sites that post codes on your company’s behalf. This will ensure complete brand control and eliminate the chances of shoppers abandoning a shopping cart because of a faulty coupon.

2 Post coupons; Be the chosen brand: The majority of adults (61 percent) say the availability of a coupon would make them forgo their favorite brand for the brand displaying the coupon. Posting online coupons is a simple way to engage with ideal online customers and encourage them to try a new brand–your brand.

3 Small offers go a long way: Nearly 4-in-5 adults (88 percent) would consider using a coupon for a purchase, and of these adults, over 3-in-5 (62 percent) would only need to save $1-$5 and over 1-in-3 (38 percent) would only need to save $1 to consider using a coupon. These statistics show that offering small discounts can go a long way. A $1-off coupon will generate brand exposure and provide you with a customer-relationship-building opportunity by promoting savings incentives instead of aggressive ads.

4 Think outside of the newspaper: Although at 88 percent, groceries are still the number-one item shoppers have coupons for, they are also using them to buy health/beauty items (63 percent), clothing (54 percent), electronics (46 percent), gifts (43 percent), travel-related items (32 percent), furniture (13 percent), as well as other types of purchases (18 percent). This means that you can use online coupons as an effective tool no matter what your service or product may be.

Christian Gordun is the founder and CEO of online coupon code and deal site Coupon Craze.

December 2009 – Column: Ask the Expert

Made to Measure

A: Online video is all the rage these days. Companies of all sizes and across all industries are investing in video cameras and editing tools, making videos and posting them on the web. What many of those firms don’t realize is that putting video on the Internet without tracking its effectiveness is tantamount to hiring a new sales rep, training him, giving that individual a customer list and then never checking in with him.

That’s where website analytics come in. Defined as the measurement, collection, analysis and reporting of Internet data for the purpose of better understanding and optimizing web usage, analytics has become a critical element for companies that want to leverage their Internet marketing investments. Analytics are particularly relevant for users of online video–particularly those who want to know if their time and money investments are paying off…or not.

“Companies are looking for a connection to their ROI,” says Chris Savage, CEO of Lexington, Mass.-based Wistia, a provider of video sharing tools for business. “It’s become even more important over the last year, due to economic conditions, and with firms starting to look to video as a way to deliver their messages more efficiently.”

MEASURING THE EFFECTIVENESS
With so many videos posted online, Savage says the next logical question marketers should ask themselves is: How effective is our video? “If you spend $5,000 to make the video, and 10 hours of each salesperson’s time pushing it, then you’ll want to know if it’s worth it,” Savage explains. “The goal is to draw a connection between the video and the investment to figure out what impact this marketing strategy is having on your business.”

That’s where website analytics come into play. By tracking a site’s statistics, analytics allows marketers to see how many people are looking at which videos, what sites those visitors are coming from and, specifically, who those users are. With that information, marketers can measure traffic to their websites, understand who’s watching what and tweak their online video strategies accordingly.

Analytics tools range from simple online programs that can be downloaded for free to expensive systems that are installed on existing hardware–and everything in between. One of the most popular is Google Analytics. Free for users, the program takes just a couple of hours to install and configure. The program tracks how often visitors come to your site, conversions across multiple pages, visitor behavior and the percentage of people who click each link on a given page.

Video hosting firms such as Wistia also offer analytics tools. Using such systems, marketers can upload their videos and use an application that tracks just how many people actually watch the clips, on which page they clicked “play video,” which videos have the highest engagement rates, how much of each clip was actually watched and at what point the typical user “skipped” to other parts of the show or tuned out completely.

With that information in hand, Savage says marketers are able to craft a clear, concise, effective message that not only entices people to watch the video, but also pushes them to buy your product or service.

PART OF THE WHOLE
Analytics tools tend to work best when integrated into a firm’s overall marketing plan, and shouldn’t be relied upon as standalone tools. “Use analytics as part of a comprehensive program that address what you’re trying to achieve with your online video,” says Brian Tervo, CEO of Burlington, Mass.-based TIE Kinetix, a provider of electronic, business-to-business collaboration tools, “and make sure that those analytics are aligned with your internal sales and marketing processes. Only then will you be able to tell if a campaign is really working.”

If, for example, a particular video has received a lower number of hits than others on your site, think about how you can improve that clip to make it better for visitors, and get them engaged in the video. Companies that go through this exercise on a regular basis are sure to see increases in their online video ROI.

“It could be as simple as re-editing the video or as complex as making an entirely new one,” says Savage, who recently worked with a product marketing company that used analytics to hone its video content over time in order to create more effective messages for its customers. “The most important strategy that marketers can use is to look at the videos that they’ll be creating in the future,” says Savage. “Once you’ve come up with that concise message, it’s pretty easy to keep your audience on your site and engaged.”

That’s good news for marketers who are struggling to attract eyeballs and stand out among the clutter that is today’s Internet. By combining online video with analytics, firms can craft marketing messages that not only call out to customers online, but also keep them watching the clips. The Holy Grail comes when those viewers take a positive action after viewing the clips such as sending the video to friends and family, signing up for an online service or purchasing a product.

Tim Hawthorne is founder, chairman and executive creative director of Hawthorne Direct, a full-service DRTV and new media ad agency founded in 1986.

November 2009 – Channel Crossing: Online

A Product Launch for the Digital Age

By Michael Weisfeld and Howard Chen

“Extra, extra–read all about it!” This old-time cry apparently used by bygone newspaper boys takes on a whole new meaning in today’s digital age. There was a time when the task of getting information to the masses was an awe-inspiring feat, typically handled by large media companies. Today, the world has gotten smaller and with the capabilities of online technologies, the only real challenge faced by marketers seems to be simply the limit of their imaginations.

But let’s be real. This undertaking requires a combination of creativity and execution–not to mention diligent follow-through.

Perform Keyword Research
Connie Mack, the longest-serving manager in MLB history, famously said, “You can’t win ‘em all.” Likewise, marketers simply can’t optimize for every keyword they can think of.

Keyword research is the process of identifying the set of words to target for pull-marketing tactics, such as search engine optimization and social media. This set of words is specifically identified to give brands the most bang for their buck. Start with a set of about 25 “seed words” that describe the product and company. Feed these into keyword research tools like those offered by Google or SEOTools to determine possible variations and associated search volumes. Review the output to select approximately 100 words for your target list. The criteria for selecting a word is a combination of relevancy to your website and predicted search volume.

Develop Content Strategy
The next step is to develop a content strategy that includes assets such as text, images, videos and other files that can be published to the Internet. A successful strategy incorporates brand messaging in all published content and an editorial calendar for continuous content development.

The content should be interesting and valuable to the users during all stages of the marketing lifecycle. Its presentation should help facilitate users’ awareness, interest, desire, action and advocacy for your product. If you find creating content to be a challenge, Junta42.com is a great resource for ideas and vendors.

An example of a good content strategy is Ford’s FiestaMovement.com. The strategy involves consistent messaging through social media channels like Facebook and Twitter to gain product awareness for the upcoming Fiesta model. To further generate interest, Ford has mobilized “agents” from across the nation to blog about their experiences with the vehicle. Desire is also targeted with a “Design Your Own Fiesta” application, which helps users shape their own 2011 Fiesta. Action is then facilitated by placing calls-to-action like test-drive events and an updates subscription. Last but not least, advocacy is supported with sharable features on all content.

Search Engine Optimization
Now you have to optimize all that useful content so that it’s properly indexed by search engines–and can then be found by your target audience when they are interested in learning more about it or better yet, making a purchase. In combination with an SEO program, PPC advertising also helps drive traffic to your website.

Closely monitor the keywords that are achieving premium rankings on search engine results pages and referring visitors to the website, especially branded terms. It is also important to make note of words used by your visitors as logged by your web analytics or onsite search. These might be words used repeatedly by your visiting audience, but which are not on the targeted keyword list. These words should be evaluated and leveraged for inspiration to amend or optimize your content strategy.

User Experience
Simply having more traffic to your site is not enough. While it’s important to have an intuitive and engaging website, the real success lies in producing quantifiable results that meet your business objectives. You will have to prevent visitors from bouncing immediately after they land on your website; first website impressions play a large role in the success of your product launch.

Many marketers have the common misconception that interesting content will overshadow poor usability. Wrong. When the user can’t find the content on your website, it may as well not exist. To make content more visible throughout your website, create “information paths” for the user to follow. An information path is the logical progression of content from broad to very detailed–and will move your customer through the conversion funnel.

Social Media
With so much effort already placed toward developing user-centered content, it would be illogical to keep this content solely on a single website. Instead, flaunt it using two distinct social media approaches. First, you should look to have social features added to your website to support a positive user experience. Examples of social features include a “share this” (www.sharethis.com) button, ratings and reviews, chat and a blog. Platforms such as Facebook have even created APIs (http://developers.facebook.com/ connect.php) that allow users to sign into your website with their Facebook identity.

The second way you can add social media to your product launch is by creating social profiles off your domain on popular platforms like Facebook and Twitter. But also look to extend to niche online communities relevant to your product.

Social media’s main value in a product launch is its ability to extend the reach and frequency of the broadcast of your content. Social media also markets to a targeted audience which has the propensity to create links in their online conversations, which in turn generate synergistic results with SEO. These created links, if rel=”follow,” supply ample SEO value as they pass the page rank of the website. While rel=”nofollow” links fail to contribute to SEO, they’re still useful in driving traffic to a related destination page.

Social links are even more likely to get clicked than banner ads because they are essentially online word-of-mouth referrals. Therefore, when launching a product, it is important to create ways for your growing customer base to easily become advocates and share their experiences with their online contacts. Also, don’t ignore the feedback provided by conversations developing in these communities. Think of these conversations as focus groups with data to supply to product managers or engineers for risk mitigation or future inspiration.

Analytics
Like DR, online marketing is all trackable. You need to gather data from numerous sources and assemble it in an analytics dashboard. Key performance indicators (KPIs) should be applied to each content. When tracked, these KPIs should tell a story about not only the performance of each piece of content, but also the user behaviors. For example, you should be able to determine the popular keywords that drive traffic to your website, how many visitors stayed and for how long and what content they consumed during their visit. Ultimately, these KPIs supplement your analytics platforms to determine the ratio between site visits and products purchased.

As marketing shifts from push to pull, traditional to online and paper to digital, product launches require more than just a smart idea and capable technologies–they require a smart online execution.

Michael Weisfeld is director of online marketing solutions at BusinessOnLine. He can be reached at michael.weisfeld@businessOL.com. Howard Chen is senior social media analyst and can be reached at howard.chen @businessOL.com.

November 2009 – Channel Crossing: Legal

CAN-SPAM and Social Media

By Jeffrey D. Knowles and Mikhia E. Hawkins

Over the past year, traditional media outlets have been awash in coverage of the way social media is revolutionizing how individuals communicate and consume information. According to marketing research firm ComScore, Twitter had more than 21 million visitors in July 2009, up from 780,000 just one year earlier. In the same period, Facebook saw its traffic double to almost 88 million users.

While using social media to drive business is an alluring prospect for marketers, it is not one free of hazards. This column addresses the implications of the CAN-SPAM Act for companies conducting outreach via social media.

What is CAN-SPAM?
The CAN-SPAM Act was passed in 2003 to combat so-called “spam” e-mails by imposing limitations and penalties on the transmission of commercial e-mail via the Internet. The original version of the Act required commercial e-mails to contain an accurate “from” line, a relevant subject line, a visible and operable unsubscribe mechanism and that adult content be labeled as such.

In 2008, the FTC released a discretionary rulemaking that clarified several compliance issues and added four new rules. These rules modified the definition of a “sender” to adjust for e-mails in which more than one party was advertising, required that all commercial e-mails feature a verifiable physical address, clarified the term “person” and required that individuals not be charged an unsubscribe fee.

When a Tweet is not a Tweet
One of the most attractive aspects of social media is the ability platforms such as Facebook give users to customize their experience. Users may, for example, receive text updates on their cell phones when information is posted to their Facebook wall, receive an e-mail when a Twitter user they follow posts a “tweet,” or receive a text, e-mail or other notification when a blog or website they follow using an RSS feed is updated.

Little has been written about whether a Twitter “tweet” by a commercial organization would, in itself, fall under the purview of CAN-SPAM, and if so, how the many CAN-SPAM requirements, such as an accurate subject line, a physical mailing address or an unsubscribe mechanism could be met within the platform’s 140-character limit.

What is clear, however, is that a “tweet” can quickly transform itself into an e-mail. For example, if a marketing message is sent, via Twitter, to users who follow a company’s Twitter updates and one of those users elects to receive Twitter updates to their e-mail account, the message–if it meets the criteria to be considered a “commercial e-mail”–could require compliance with the CAN-SPAM Act.

Although there is an untested but strong argument that the marketer has no knowledge of or control over the applications users enable on their various accounts, cautious marketers should design commercial messages intended to be distributed via social media platforms to comply with the most restrictive regulations until this theory has been tested.

Consideration
Providing consumers with something of value, or “consideration,” to encourage a behavior is one of the oldest and most reliable marketing tactics in the book. It is also the bright-line test that, according to the FTC, determines whether a forwarded e-mail is subject to CAN-SPAM.

When the FTC added new rules to CAN-SPAM in 2008, it also addressed a number of other e-mail marketing issues raised by Act. Among these was the applicability of CAN-SPAM to “forward-to-a-friend” marketing tactics, where a marketer requests or induces a person to forward a commercial message to another person. The FTC concluded that if marketers induce a person to forward a commercial e-mail message by offering money, coupons, discounts, awards, additional entries in a sweepstakes or other consideration, then the marketer is responsible for ensuring compliance with CAN-SPAM’s opt-out and disclosure requirements in the forwarded e-mail.

However, if the marketer merely provides a mechanism by which a person can forward a message, without providing consideration, then the marketer is involved in the routine conveyance of an e-mail and is not responsible for ensuring the forwarded e-mail complies with CAN-SPAM.

Because many social media instances of “forward-to-a-friend” are similar to the e-mail scenario outlined above and, in many cases, may involve e-mails sent to accounts or mobile devices, marketers should assume that the CAN-SPAM guidance will be applied to forward-to-a-friend messages transmitted via social media platforms.

One scenario with potentially dire consequences for marketers is one in which consideration is given to a user who then forwards the marketer’s message to another user. If the user receiving the forwarded message has previously opted out of receiving messages from that marketer, the marketer could be liable for violating CAN-SPAM. Given the tendency for broad and repetitive sharing of information on platforms such as Twitter and Facebook, an individual could receive the same marketing message from dozens of other users, generating significant liability for the marketer.

Accordingly, marketers should avoid using inducements of any kind to encourage “re-tweeting,” the posting of content to users’ Facebook walls, or otherwise disseminating content to users’ contacts. Avoiding triggering CAN-SPAM compliance by not providing consideration enables marketers to eliminate significant potential liabilities and helps them to avoid disclosure and opt-out requirements that may prove difficult to comply with given the limitations of some social media platforms, such as Twitter’s 140-character limit per message.

Don’t Forget the States– and Look Before You Leap
CAN-SPAM is not the only regulation marketers should consider when developing social media marketing campaigns, especially those involving contests. A poorly conceived campaign could easily run afoul of certain states’ e-mail marketing, privacy and/or gaming laws.

As social media expands and matures, marketers need to keep in mind that although the medium appears to have outpaced regulation, federal and state authorities are likely to look to existing rules and guidelines as they build a new regulatory and enforcement framework. For marketers engaging customers and prospects in the social media space, looking backward for likely regulatory guidance will be just as critical as looking forward to spot emerging opportunities and trends.

Jeffrey Knowles is a partner at Venable LLP and heads the firm’s Advertising and Marketing Practice Group. He can be reached at (202) 344-4860. Mikhia E. Hawkins is an associate in the firm’s Regulatory Practice Group with a focus on advertising and marketing law. He can be reached at (202) 344-4573.

November 2009 – Column: Industry Insight

Internet User Trends Show Importance of Media Placement

By Chris Rosica

Content is king for Internet users. The Online Publishers Association (OPA) crunched six years of Nielsen numbers to compile its latest Internet Activity Index, which shows that people continue to spend the vast majority of their online time on content sites. Whether it’s for serious news, celebrity gossip, health guidance or product comparisons, people use the Internet mostly to gather information.

The takeaway from the trend is this: The marketing mix must include public relations outreach to garner media attention. This doesn’t de-value emerging online advertising methods, such as integrated or micro ads, blogger branding and paid tweets on Twitter. It simply reinforces the importance of editorial coverage.

Products mentioned favorably in media reports receive an implied third-party endorsement. Consider news stories about fighting the obesity epidemic that cite a specific workout video, for example.

Neutral–or even negative–references can still be beneficial by boosting name recognition and raising awareness of your product or company. Take the Snuggie, for instance. Sales of the so-called “sweater with sleeves” continued to spike amid news reports this summer that consumers found the commercials cheesy and hilarious. Funnyman Jay Leno poked fun at Snuggies, Ellen DeGeneres spoofed them on her show and on the web, a snarky site (snuggiesitings.com) lets people share humorous images of Snuggie wearers.

How we Spend Online Time
The OPA compared how people used the Internet in 2003 with how they use it today. On average, people spend 6 hours and 58 minutes each month viewing content compared to 3 hours and 42 minutes in 2003. The analysis, using Nielsen/NetRatings data, shows people using Internet-based communications tools (IM, e-mail) less now than they did in 2003, probably because social networks, such as Facebook, give them an efficient way to communicate with many others at once. This finding argues against relying too heavily on e-mail marketing and bolsters the case for using social media to reach wide audiences.

The OPA compared the amount of online time in a variety of categories in 2003 versus today. In addition to content, communications and community, the OPA analyzed e-commerce sites and search engines. The analysis showed major changes in the way consumers spend their online time–less time in communications and commerce and significantly more time on content sites and search.

While the raw numbers for search seem low (although search time grew by more than 60 percent, it still comprises only five percent of our total online time, as compared to three percent in 2003) based on the Internet’s popularity for research, this demonstrates current trends and establishes the importance of online content development. Content can be optimized through search engine optimization practices including social media and link building. Websites will continue to rise in search rankings with the development of fresh content placed strategically online.

Chris Rosica is CEO of Rosica Public Relations, which specializes in online and traditional PR and online reputation management. He can be reached at chris@rosica.com.

November 2009 – Cover Story: 35 Years of Direct Response

Well into its fourth decade of selling hair-restoration products and procedures exclusively through direct response, Bosley is a company that has evolved along with the DR industry as a whole. Bosley’s George Fettig reflects on the maturation of the DR industry and his company’s keys to success.

By Tom Dellner

In 1974, Dr. L. Lee Bosley wasn’t looking to build a business on a grand scale–he simply wanted to grow his personal Los Angeles-based medical practice and provide for his family. Today, Bosley is not only the global leader in hair restoration, it’s the largest cosmetic surgery practice in the world. Two dozen Bosley physicians practice in 72 offices throughout North America and the company is eyeing further expansion into international markets.

Vice President of Marketing George Fettig has headed all of Bosley’s marketing initiatives for the past decade, a decade which has seen the company double in size. With a 30-plus-year career bridging brand marketing (he’s worked with such household names as Dial Soap, Armour Meats and NordicTrack) and a stint working directly for business icon Lee Iacocca, ERA Board Member Fettig offers a unique and fascinating perspective on the direct response business, as well as candid insights into one of the industry’s most enduring success stories.

Electronic Retailer: So few companies make it to their first anniversary–to reach your 35th is beyond impressive. Could you take us back to the company’s earliest days?

George Fettig: Dr. Bosley would be the first to acknowledge he really didn’t have a “vision” in the classic sense. He simply wanted to take his personal interest in the emerging medical science of hair transplantation and build a successful local medical practice right here in Beverly Hills, to help patients and build a good life for his family. Thirty-five years, 200,000 patients and hundreds of millions of dollars later, it’s fair to say that he’s satisfied those goals.

ER: Why the interest in hair restoration?

GF: Dr. Bosley did have hair loss in his family and, as he says in his commercials, he is a patient, but I don’t think that’s what drove him. He’s simply an entrepreneur at heart. He’s a dermatologist and spent years in general dermatology before learning about this technique, which he then significantly refined and made his specialty.

ER: What was the competitive landscape like at the time?

Bosley also offers a full line of hair-growth products, including the Bosley LaserComb.

GF: When Dr. Bosley opened the practice, there were very few physicians offering hair-restoration procedures–perhaps half a dozen across the country. He was truly one of the early pioneers and one of the first to recognize that the artistry of the procedure was as important as the actual medical science. Producing a natural look was his forte and differentiator. Back then, the primary “solution” to hair loss was wigs or hair pieces; Sy Sperling’s “Hair Club for Men” was the only nationally branded solution.

ER: What were some of the company’s early challenges?

GF: When Bosley opened its doors in 1974, advertising in the medical industry was frowned upon. In fact, prior to the ’70s, doctors were prohibited from advertising by state laws. Advertising was seen as incompatible with a doctor’s professional status. This prohibition extended to attorneys, as well.

In the mid-’70s, the ban was challenged on First Amendment grounds, and overturned by a slim margin. But despite the change in the law, most doctors still shunned advertising. Negative sentiments about advertising among the medical establishment were deep-rooted. It was in this hostile environment that Dr. Bosley decided to advertise his new service to the public. And because of this advertising–and his commitment to providing excellent medical care–the Bosley hair-restoration practice grew rapidly. The growth has never stopped.

The other major obstacle in the early days was the public’s negative image of hair transplantation. During the ’70s and ’80s, many new doctors moved into the field, perhaps to capitalize on demand created by Bosley’s advertising strategy. But back then, the technology was quite different than it is today. Hairs were transplanted in unnatural groupings (as opposed to Bosley’s technique of transplanting much smaller groupings in an artistic way), with results that were anything but natural-looking. Of course, these were the transplants that were very visible to the public and created an enormous PR problem for the industry.

Dr. Bosley pushed forward, though. I guess it was the quality of the procedure and the consistent and compelling DR messaging that allowed the business to succeed in spite of this stigma. Dr. Bosley’s primary message is one we still use today: “When patients tell me they’ve never seen a good hair transplant, I simply tell them, ‘That’s because you can’t see a good hair transplant!’”

ER: Tell us a bit about your early marketing strategies. Did Bosley pursue a direct-response strategy from the start?

GF: Bosley employed direct-marketing practices from its very first newspaper ad in 1974. The company recognized that the tracking of individual responses, in order to maximize what was then a fairly meager ad budget, was essential to financial success. In the ’70s, with offices in a few major markets, local newspaper and Yellow Pages advertising was sufficient to drive local demand.

In ’80s and early ’90s, the company had become large enough and widespread enough to support ads in regional magazines as well as a few well-targeted national publications (primarily bodybuilding, fitness and airline magazines). But Bosley was 100-percent direct response–right from the beginning. In fact, we still use essentially the same offer 35 years later: a 45-page guidebook and free informative video (now a DVD, of course). Patients wanted to be educated and informed back then, and they still do today.

ER: When did the company first test the waters of DRTV?

GF: John Ohanesian–Bosley’s CEO for the past 20 years–had the initial vision to create a truly national cosmetic surgery practice. He reasoned correctly that television advertising could take the company and the brand to the next level. So in 1992, Bosley produced its first infomercial. John told me that many industry “experts” informed him that introducing a $10,000 medical procedure with a 30-minute late-night infomercial was paramount to corporate suicide, certainly risking the company’s reputation. But John believed that if the show was produced at a high quality, including honest patient testimonials with compelling results, and if it featured Dr. Bosley himself, it couldn’t miss. He was right. We’ve now been on the air continuously for 17 years.

We learned a lot from those early infomercials. Creatively, we learned to always keep the production values very high (we shot on film for the first 15 years or so), the testimonials real and compelling and to deliver the message in a professional, informative way. We were promoting an important medical procedure. There was no place for cheesy scenes showing women falling all over guys with their new hair–that became clear to us early on. Our customers needed real information about a serious medical decision. The show had to reflect–and respect–that.

We also discovered the value in having an in-house call center with thoroughly trained patient-service representatives. Ours is a particularly complicated process, requiring a lot of listening, consultation and education–and a long call time. The callers, mostly men, can be nervous and apprehensive. Training, monitoring and mentoring of our patient services team was a key to success. When we brought the function in house, our conversion rate doubled. Dr. Bosley would frequently walk the floor himself and provide on-the-spot training.

ER: What are some of the most important ways DRTV has evolved over the time you’ve been on air? How did you adapt?

GF: After more than 25 years of watching direct-response infomercials and commercials (and frankly, being duped by many!), the consumer has grown more jaded, skeptical and suspicious, and at the same time more savvy, educated and intelligent about the purchase decision. The direct-response industry–for the most part–has responded with better products and more honest, intelligent and effective advertising. The ERA has played an important role, encouraging self regulation and, when necessary, taking action to remove offending advertisers from the Association and reporting fraudulent product claims to the FTC.

Another way the industry has evolved is in the sophistication of response analysis. We’ve always tracked leads, of course, and calculated media efficiency ratios, but today’s technology allows us all to be so much smarter in the ways we allocate media dollars. For example, we now use a hosted call-center solution that allows us to integrate our toll-free numbers directly to our database through computer telephony integration. So we no longer have to rely on our agents to enter campaign codes; the system does it in split seconds, with near-100-percent accuracy. The end result is more efficient agents and more efficient media buying. With 800 different 800 numbers in use–and 30,000 to 40,000 calls every month–you can only imagine how valuable this technology is to Bosley.

ER: Yours is truly a multichannel marketing strategy–would you mind outlining some of the elements for us?

A new line of Bosley Professional Strength products will be available in more than 30,000 salon locations.

GF: Bosley utilizes all of the major DR channels, and we are testing emerging technologies, as well. Bosley’s primary channel remains DRTV. Infomercials still deliver very well-qualified leads with high conversion rates. However, the infomercial strategy is not totally scalable for us. We also run short form to increase brand exposure, but more importantly to generate more leads. As you might expect, those leads are a little less informed and convert at a lower rate, but then again, they cost much less to acquire. At the right cost-per-lead, we are pretty much agnostic between infomercial and spot.

Of course, online marketing has become critically important to the overall acquisition strategy. In fact, nearly 50 percent of Bosley’s overall revenue is tied to an online lead in one way or another. The majority of our website traffic is generated by liberal promotion of Bosley.com in all of our offline advertising (TV, radio and print).

While the Internet provides countless advertising formats and opportunities, not all are appropriate for Bosley. For example, mobile advertising, while technically exciting, is not yet appropriate for us, because of its inability to deliver an information-intensive ad to a broad consumer base. Likewise, community-based social media platforms may not work for Bosley, since hair-restoration patients are not as likely to share their successful results with the community. That said, we are testing the waters.

Our remaining web efforts include SEO–optimizing our website to maximize quality traffic and conversion–PPC advertising, cost-per-lead advertising (generating leads through e-mail and affiliate marketing), social media (including our own “Battle Against Bald” blog) and display advertising, which we use sparingly.

The final strategy is mining our database of over one million names. The decision cycle for hair restoration is lengthy–several years, in many cases. It’s critical to our business that we stay in constant touch with these patients and leads, through a well-coordinated, constant flow of telephone, e-mail and direct-mail communication. It takes powerful CRM software and a dedicated staff to manage the process. We have both.

ER: How do you pull the right levers to keep all of these channels working together synergistically?

GF: We hire the right people. Our marketing director, Steve Aquavia, has the perfect balance of creative and analytical skills. Steve and his staff constantly monitor results from every lead-generation category. We look at cost-per-lead, mix ratios, conversion rates and cost-per-procedure. Steve reports weekly and we discuss what shifts need to be made to maximize short-term results. We constantly test, evaluate and then re-set the dials. It never stops.

ER: I understand that you’re launching a line of branded products. Could you tell us a bit about this initiative?

GF: We’re taking the Bosley brand to new channels of distribution. Earlier this year, we reached a licensing agreement with a salon-products company to produce a full line of “Bosley Professional Strength” products. Our plan is to have these products sold in over 30,000 salon locations over the next several years. Salon stylists are the most trusted source (other than a doctor) for information and advice on thinning hair. This expansion to retail will further expose the Bosley brand name to millions of men and women with thinning hair. The synergism with our base business is clear.

ER: To what do you attribute Bosley’s longevity?

GF: As a company, every Bosley team member, from the patient service representatives to our senior counselors to our incredible medical staff, strives to meet or exceed the consumers’ expectations set in the advertising message. When you do that, you create satisfied patients, generate repeat procedures and stimulate positive word of mouth.

ER: What are some of the other future plans for the brand?

GF: With the economic downturn, we’ve had to focus on cost containment, improved efficiency and more effective advertising. However, we’ll continue our efforts to extend the Bosley brand to relevant product categories. Beyond that, I think you’ll see the company turning its attention to further expansion internationally.

October 2009 – Channel Crossing: Online

The Internet Finally Comes of Age–For DR

By Michael Pierce

DR short-form advertising strategies are changing dramatically with the emergence of the Internet as a viable marketing channel. With sales of more than $200 billion in the United States and an expected growth rate of 10 percent over the next two years, the Internet is serious business. In the last five years, Internet video has been replacing online ad strategies such as PPC and traditional SEO as a vehicle to grab a slice of this growing pie. Add in the fact that the Internet is now the gateway to mobile marketing and it is easy to understand why serious conversations about how to integrate online video into DR campaigns is now taking place. The main issue today for campaign managers isn’t whether to use Internet video, but how.

As a director of DR commercials, I must admit I still get excited each time I see my work on TV. Sadly, though, TV isn’t what it used to be. With the advent of DVRs, on-demand programming and the 20-percent increase in the number of people watching programming online this year alone, TV continues to become a weaker and more fragmented medium.

It’s no wonder, really, since the Internet allows the best of both worlds for the viewer and advertiser alike. Viewers choose only what they want to see, when they want to see it, while advertisers have the luxury of marketing to a more specific audience. Whereas TV is a “lean-back” environment, the Internet is a “lean-forward” experience filled with people eager to be served offers, entertainment and information.

About a year ago, I was taught the gospel of Internet video advertising and marketing by Erik Craighead, founder of Video Army, LLC, and longtime Internet guru. Over the course of a few weeks, Erik enlightened me as to what was happening online. We ran scenarios, tested videos, looked at case studies and evaluated current campaigns. I was so enthused that I proposed that my company (Mutiny Pictures) and his become partners to bring true Internet marketing and advertising to the DR world. Erik agreed and VAMP (Video Army Mutiny Pictures) was born.

Since that time, we have launched campaigns for well-known and lesser-known companies alike. Some campaigns have focused on a national audience while others have focused on a region-by-region basis to better serve a franchisee philosophy. In either case, it is always thrilling to see our clients dominate Google’s organic search results, infiltrate a competitor’s search space online and outperform TV sales. Today, we offer a well-rounded system that gives DR campaigns the ability to do targeted video advertising, distribute their commercials virally and within social media communities, and to use video with keyword strategies so our clients quickly enjoy placement within the highly coveted organic search results.

Online Video Advertising in Practice
Targeted video advertising is one of the best ways for a DR brand to re-purpose their existing commercial online. One approach is a performance-based, roll-over video ad model. Roll-over video ads are a great way to showcase a product or service. First, a video ad is served to high-quality websites within an ad network. This gives advertisers control over where their spot plays and assurance that it won’t be placed on a website they find objectionable. Secondly, as a performance-based system, clients only pay for each time their ad is actually viewed. There simply isn’t any charge for an impression. So if an advertiser has a target mark of 200,000 views of their commercial, they might receive 15 million impressions of their video ad for no additional charge.

Another impressive aspect is that the cost-per-view charge for a video ad (when a consumer actually views the spot) is usually less than most PPC strategies such as AdWords. When a video ad is served, it can be designed to cover the user’s current webpage, giving the advertiser a captive audience. A consumer then has the option to click through to the advertiser’s website at any point during the ad, taking them to a URL of the marketer’s choosing for no additional charge.

A host of metrics is provided daily, allowing performance to be refined. Better-performing websites can be used more and non-performers can be eliminated. And if the total views contracted aren’t delivered, the difference can be refunded to the advertiser.

Other online video advertising strategies include leveraging video to establish and grow a consumer base via social media, using video to help with product “tone control” and ad placement within online video networks such as Hulu.com, thus making DR available within primetime programs such as NBC’s “30 Rock” and many others.

Online Video Versus TV
The benefits of online video advertising become even more clear when compared with other traditional mediums, particularly TV. First of all, TV for DR is usually not primetime inventory. Many ads are exhibited in late night or overnight slots where ads frequently get preempted and the audience is not guaranteed. A brand pays for the estimated audience determined by a group like Nielsen, but there is no guarantee anyone is watching. With TV, even if the ad is served, it may never be seen by the consumer–and no one will ever know. The potential lead might get up for a snack, make a phone call, be asleep or simply fast-forward through the ad.

In short, with TV, you pay for the impressions with no guarantee of views. If a consumer does engage your ad via a call center, you then incur another level of billing that far exceeds online e-commerce charges. With that said, I firmly believe that our clients still need to be on television, but they need to integrate those campaigns with an online strategy. In a perfect world, a client utilizes television to build brand awareness and set the table for more efficient sales via the Internet. After all, the key to success in any form of advertising is frequency. But while we do indeed see a spike in sales activity when TV is combined with Internet strategies, excellent conversion rates can also be achieved without TV.

No campaign is the same, and I firmly believe that each client strategy should be treated more like haute couture, rather than with an “off-the-rack,” one-size fits all philosophy. Whether a brand is in its product launch or extending itself into yet-uncharted waters, considering a multitude of tactics is the best play. These are very exciting times for online video marketing and no industry is better-positioned than DR to leverage new concepts, ideas and strategies, harnessing them to reach new consumers.

Michael Pierce is the founder of Mutiny Pictures and a pioneer in online video advertising strategies. He can be reached at michael@mutinypictures.net.