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Internet Marketing with Mike Moran and Lee Odden, Part 3 of 8 (Audio Podcast Transcript)

Marketing experts Mike Moran and Lee Odden discuss "Do It Wrong Quickly: How the Web Changes the Old Marketing Rules." Part 3 of 8: The new direct marketing — improving response rates and using activity metrics.

This is a transcript of an audio podcast.

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Editor's Note: This is episode 3 of 8. If you are just jumping in, you might want to start with the transcript of episode 1.

Lee Odden: Welcome to IBM Press Podcast series of Mike Moran and Lee Odden. I am Lee Odden, CEO of TopRank Online Marketing and Executive Editor of marketingblog.com. TopRank is an internet marketing consulting agency that provides enterprise, search engine optimization, social media, and online public relation services for companies ranging from Hewlett Packard to McKesson. Our guest is Mike Moran whose credentials list is nearly a mile long. Mike is the author of two important books, the new Do It Wrong Quickly: How the Web Changes the Old Marketing Rules and Search Engine Marketing, Inc. Mike Moran is an IBM distinguished engineer with more than 20 years experience in search technology. He led the original search marketing strategy for IBM.com as well as the integration of IBM.com’s site search technologies. Mike worked on IBM’s website for eight years and now works on IBM’s OmniFind Enterprise Search and Analytics Products. In addition to his search work, Mike is also a columnist for Revenue Magazine and WebProNews. He also writes a very popular blog called "Biznology," which you can find at mikemoran.com. In this third podcast out of eight, we’re going to talk about the new-fangled direct marketing where we’ll discuss a little bit about what all those people are stuffing in mailboxes and what they know about direct marketing.

LO: Mike, a lot of people who grow up in marketing know TV and print and then they look at the web and think it is more of the same. Is it?

Mike Moran: A lot of people want to approach it that way. They say to themselves, "Well, you know I watched TV turn in to cable and print magazines really splinter, and all I have to do is figure out new ways of buying advertising and I was all set." The problem is that the web doesn’t really work that way. You can just go buy banner ads, but more of the time you’re going to be successful by putting content out there that people really want to choose. The kind of people that really do understand this are the direct marketers. The credit card companies who are putting mail in your mailbox, saying to get a new credit card, or the ones that are stuffing catalogues in with products for you to buy know that their marketing is based on response. So the more people respond, the more effective their marketing is. They experiment. They try and change what their offers are and the pictures in the catalogues. The guy who put the yellow sticky on that credit card letter saying don’t throw me away yet is in the direct marketing hall of fame because he improves response rate by 0.4%. So, those are the people that really do understand how to do web marketing because with the web you can measure everything.

Rather than having a kind of advertising that interrupts people from what they were trying to do, in web marketing you’re trying to find people who are interested in what you want, who select what it is that you are selling, and that they actually click through and read more and more about what you want; and eventually they buy something. Now, a lot of people might tune out at that point because they don’t have a shopping cart on their site, but what they really need focus on is what is your website about. So, what is the purpose of it? Is the purpose for people to call a phone number and transact with you offline? Is the purpose for them to fill out an e-mail contact form? Should they download a white paper? What is it that you want your website to do? Whatever that is, that’s your conversion. That’s the response that you are looking for. What you want to do is measure how many people see your message, how many people choose your message, and how many people convert based on your message. Once you’re looking at that it gives you a feedback loop where you can watch everything that people do. You can make decisions about how to change your marketing messages based on that.

LO: There are so many opportunities for interaction and engagement and measuring conversions in that kind of scenario. It seems that a lot of marketers don’t have experience with conversion and activity metrics. What would you say to them?

MM: Well, it is probably true that a lot of marketers have gone into this as a refuge from mass. That’s kind of nerve racking for them in some ways, but the truth is that you can turn the calculator off and the numbers will go away if it ever gets too stressful. So, you don’t necessarily have to be the person who understands all those calculations and knows whether it is statistically significant that after we change the page it was 1% better than it was before. But you do need to understand the concept. As opposed to the past where you might make conclusions based on market research where you would draw conclusions based on what a few people in a focus group said, now you need to be willing to draw conclusions based on what people do.

Listening is very important to hear what people say, but watching what they do is sometimes even more important. So, amazon.com is a great example. A lot of people think Amazon is successful because of the personalization they do, and that’s true. But a bigger reason for their success is because they measure everything they do. Way back when, they had this big debate about whether they should have the shopping cart on the left side of the page or the right side of the page. There wasn’t any way to compromise. They couldn’t run the shopping cart down the middle of the page or have it on the left on the odd numbered days and right on the even numbered days. They just had to run a test and decide, and so they did. They ran a test and found out that they got 1% higher conversion rates when it was on right side of the page. So when they did that they said, "Okay, now we’re going to put it on the right side of the page." Every company can test a million little things. When they do that and get the results, they can make decisions. Each time they make a decision, they are improving their conversion rate and improving the number of customers that buy from them. That’s how they can gradually make their web experience something that becomes really, really important in terms of converting customers and providing customers with a good brand image.

LO: The notion of these kinds of metrics and attention to analytics and being able to test, measure, and revise really sounds more like an organization will be more successful if it adopts it as a philosophy about how they go to market as opposed to maybe just one place or another within an organization.

MM:That’s true. You know when we talk about Do It Wrong Quickly we were really talking about changing what your attitude is. In the latter part of the book, we talk lot about how hard it is to do that. We’ll talk about that later in this series of podcasts. But the thing that you really need to do is to just understand what the basis of it is. The basis of it is if you listen to what customers say and you watch what they do and continually change what you are doing in response, it’s amazing how smart you’ll look. Over a period of time, you’ll look brilliant. You’ll eventually lurch into the right answer no matter how dumb you started out, and that’s really what the point is. The point is to try and figure out how you can set up these feedback loops so you can pay attention to what your customers really, really want. That will get closer to your customers; that will get closer to what it is they are looking for. To the extent that you can change your business whether it’s web marketing, whether it’s your products, whatever it is, and you can do that, you are going to be much more successful.

LO: Fantastic. Sage advice, Mike. Thank you. Well, that concludes our third podcast of eight from IBM press and our discussion with Mike Moran of IBM. In the 4th podcast, we’ll talk about the new customer relations and how your web experience is your new brand image. For more information about both books, Do It Wrong Quickly and Search Engine Marketing, Inc., please visit mikemoran.com. This series is brought to you by IBM press at www.ibmpressbooks.com.

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