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Feb

26

Online Marketing Is Painful For Local Advertisers

Posted by Tom Young, Manager, Director, Online Marketing & Product
Filed Under Click Marketplace, Online Marketing, Research, Search | Leave a Comment 

Cost-per-click (CPC) advertising is the lifeblood of our business. We recently began testing CPC advertising across a variety of search engines and ad networks, and we immediately noticed a lower quality of traffic as compared to Google and Yahoo. Specifically, landing page bounce rates are considerably worse on ad networks and low-tier search engines.

With any acquisition source, bounce rates serve as a great measurement of traffic quality, or the ability to accurately geo-target consumers. If a high percentage of consumers hits the back button immediately upon reaching our landing page, it indicates we’re attracting (and paying for) consumers who didn’t intend to see our offering. More importantly, a higher bounce rate means fewer clicks have the opportunity to convert on page two, which diminishes the revenue opportunity.

For clicks that don’t abandon our landing page, conversion rates on page two are comparable across all sources (SEM, SEO, display, e-mail, affiliates). This means the value of a consumer who reaches page two of our conversion funnel is equal across all sources (we use “net clicks” to define traffic that moves to page two). Net clicks are important to measure because the cost of a net click accounts for abandonment rates and allows for a fair cost comparison across all traffic sources. The data below shows how gross CPC and abandonment rates factor into the cost of a net click.

Ask.com is one of the search engines we recently began testing. As compared to the bigger search engines, our bounce rates with Ask.com are considerably higher, but the gross CPC is lower, causing the cost-per-net-click to be equal. In this case, high abandonment rates are tolerable because the gross CPC is low enough to offset the influx of abandoned clicks.

We’re also exploring AOL, Miva, 7search, ADSDAQ, MarchEx, Right Media, Value Click, Quigo, Avenue A, and a suite of ad networks offering CPC advertising. Abandonment rates are high across most of these sources, but only some of the sources offer a CPC low enough to meet our cost-per-net-click targets. For the most part, the revenue opportunity across these sources isn’t high enough to justify the cost of account management, bid management, and analytics tracking.

High abandonment rates, coupled with the inability to accurately geo-target, makes spending profitably on ad networks and low-tier search engines nearly impossible for small and local advertisers. Some of the sources work for us because we can buy nationwide traffic, we’ve invested heavily in landing page optimization, and we have a team dedicated to evaluating new media sources and managing the accounts. Most companies cannot invest this depth of resources, causing them to miss out on a significant volume of traffic across a unique blend of web properties.

We provide online marketing services to small and local advertisers, and we recently began selling geo-targeted net clicks to our clients. A net click that is geo-targeted is called an “Enhanced Click,” and Enhanced Clicks convert better for our clients than their traditional traffic sources. By eating the abandonment traffic and delivering clicks in precise geographic locations, we allow local advertisers to reach consumers across a span of web properties that have historically been too cost-prohibitive to manage.

Buying Enhanced Clicks avoids the costs of SEM account management, and it ensures an even quality of traffic, regardless of advertising source. We’ve seen almost no attrition across buyers of Enhanced Clicks since we began testing, and we’re confident this quality of traffic can’t be beaten. This offering is currently available for car dealers (new cars) and real estate agents (home buyers, home sellers), and we’ll be offering Enhanced Clicks for a variety of new verticals in 2009. Visit the Reply.com home page for more information about the Reply! Click Marketplace.

Feb

20

Countdown to LeadsCon + A Special Discount Price

Posted by Brian Bowman, CMO, Reply.com
Filed Under Lead Generation, Reply! News, Tradeshows | 1 Comment 

Please join Reply! at LeadsCon in Vegas March 3rd & 4th

Thanks to LeadsCon, we are able to offer our blog readers and Reply users a special discount price of $395, saving $600 off the regular admission (good while supplies last or until Feb 25th). If you didn’t attend last year’s event, it was completely sold out. If you would like to attend, please take advantage of this special offer.

Click here for Reply!’s special discount rate!

If you are planning to attend the show, please let us know so we can arrange a time to meet and fill you in on Reply’s offerings.

Payam (Reply!’s CEO) will be on the panel, “Lead Exchanges: The Future of Lead Generation?”

  • Moderator: James Cham, Vice President, Bessemer Venture Partners
  • Panelists:
    • Payam Zamani, Chairman & CEO, Reply! Inc.
    • Keith Moore, Senior Vice President, Lending Tree, LLC, Tree.com, Inc.
    • Anik Ganguly, Board Member, Detroit Trading
    • Marc Diana, Founder & CEO, LeadPoint

Exchanges have historically created and defined new markets, providing maximum efficiency, critical mass, and synergy. Top executives discuss the current challenges exchanges face in the lead generation industry and what it will take for them to continue to expand and take market share. Listen to them as they address tough questions such as, “Do publishers earn more from exchanges, and do their customers really receive higher quality?”

I will be moderating the panel “Local Advertising – Lead Gen’s New Black?”

  • Moderator: Brian Bowman, Chief Marketing Officer, Reply! Inc.
  • Panelists:
    • Hanan Lifshitz, Co-Founder & CEO, Palore
    • Paul Ryan, Founder & CEO, DoneRight!
    • Anthony Wills, Chief Revenue Officer, Dotmenu, Inc.
    • Robert Wright, Founder, EVP and General Manager Xchange, ReachLocal, Inc.

The shaken credit markets mean a potentially uncertain future for what has been the backbone of lead generation – verticals powered by lending. They have left many wondering from where the future growth will come. While, we will see a heavy emphasis on international opportunities and big brands, an often overlooked segment are the hundreds of thousands of local advertisers who have barely scratched the surface of online advertising, who represent billions in annual spend. Is it a question of if, when or how?”

We look forward to seeing you at the show.

Feb

6

2009 Tradeshows – Updated

Posted by Brian Bowman, CMO, Reply.com
Filed Under Tradeshows | Leave a Comment 

2009 conferences: Social media, tech, marketing – I stumbled across this great list of some of the best social media, technology, media and marketing conferences for the upcoming year. This also doesn’t include the many worthy BarCamps, PodCamps and Social Media Club gatherings around the country.

Missing from the list

Feb

3

Foreclosures Dominate Home Sales – And Consumer Interest

Posted by Tom Young, Manager, Director, Online Marketing & Product
Filed Under Economy, Research, Search | Leave a Comment 

According to CNNMoney.com, nearly 20% of home sales in 2008 came from foreclosed homes, with another 11% coming from short sales. What’s even scarier is the fact that home values dropped more in the fourth quarter of 2008 than they did in all of 2007. As the presence of foreclosures on the market increases, the online buzz surrounding foreclosed homes follows closely.

As a company providing online real estate information, we measure the interest of home buyers across our portfolio of consumer acquisition sources. We’ve recently seen a drastic shift in the behavior of potential home buyers–more and more buyers are searching for foreclosures, and are showing less interest in “normal” home listings. Search queries for keywords such as “bank foreclosures” and “foreclosed homes for sale” have skyrocketed across the major search engines since Q4 of 2007.

Our marketing team first got a taste of the foreclosure buzz in late 2007. We had been targeting home buyers via search engine marketing for years, with foreclosure keywords representing a very small percentage of our traffic. When Yahoo ran a news story on their homepage highlighting an uptick in foreclosure listings and a reduction in home values, we quickly saw a shift in the interest of potential home buyers. For context, we were bidding on the keyword “foreclosed homes for sale” and went from spending roughly $50-per-day on Yahoo to more than $8,000 in three hours. The shift was quick, it was powerful, and it has sustained for well over one year.

Both sides of the foreclosure crisis are feeling the impact, but to varying degrees. Foreclosures have brought hardship to many families, forcing them to explore more affordable geographies while watching their home equity vanish. But for a new wave of home buyers, foreclosures represent an opportunity to acquire homes at prices that were inconceivable just two years ago.

Our goal, as we provide an online marketing solution to real estate professionals, is to acquire consumers with the highest likelihood of completing a real estate transaction. We’re interested to see where the real estate market will turn in 2009, and we’ll continue to monitor the intent of home buyers and sellers in an effort to provide the highest quality clicks and leads to our network of real estate agents.

Feb

3

How Are 1,200 Online Marketers Acquiring Customers?

Posted by Brian Bowman, CMO, Reply.com
Filed Under Online Marketing | Leave a Comment 

Ad:tech and MarketingSherpa put together a year-end recap of 1,200 marketers. I found the results very interesting, and the charts below offer a visual look at the tactics marketers will use most.

  • Email – always an important and inexpensive source of acquisition. 
  • Paid Search – something Reply! is very focused on.  We spend well over $1 million/month across multiple search engines to acquire a vast majority of our traffic.  We have recently launched a Click Marketplace that allows any business to purchase what we call an “Enhanced Click.” An Enhanced Click is a click where the consumer has taken a second step in the search process, confirming their interest in a product or service and specifying their physical location. This product is important because it eliminates the technical complexities of SEM and allows buyers of our clicks to purchase “Net Clicks,” clicks that have the back button and unintentful traffic removed, and offer perfect geo-targeting because the consumer has entered their physical location. For more information, please check out this post.
  • Affiliate Marketing – useful as a filler to core acquistion if you have the stomach and tracking processes in place to separate out good sources from bad.
  • Media (Banners, Rich Media, Video, etc.) – all viable channels, but many consumers acquired through these channels are further up the conversion funnel and aren’t ready to purchase. 
  • Behavioral Targeting – very useful, especially if you are using ad networks or ad exchanges.  Finally, you can easily purchase audience segments regardless of what site they are visiting.  You can check out companies like Tacoda or Revenue Science for more informaiton. Also, here are a couple of posts with more informaiton: Exchange Marketplace, Digital Network Landscape.

Show Me The Money

  • Based on our experiences, we have found a similar ROI with PPC (Paid Search) advertising.
  • Emails are highly profitable because the cost is traditionally so low.
  • Rented 3rd-party lists are usually the least profitable with the lowest close rates but, if managed properly, can be profitable.
  • SEO is fantastic, but highly unpredictable and unreliable as Google/Yahoo frequently reindex.
  • My key takeaway from the above chart is that acquisition channels with poor targeting and control almost always have poor results.  Have you ever tried to buy geo-targeted banners or easily start and stop campaigns in ad networks? Trust me, it is painful.

2009 Investments in Online Marketing

If you are going to experiment with paid search and your business requires that you geo-target, you will quickly discover that Google and Yahoo are, at best, 50% accurate with their targeting.  Said differently, you will waste a lot of money trying to make search profitable.  In my opinion, most businesses should be engaged in search marketing. Consumers are online, and businesses should be, too.  If you are going to experiment with paid search, please check out the Reply! Click Marketplace. The system offers perfect geo-targeting, intentful consumers, and you don’t have to manage keywords, technology, or ad copy.  It takes about 5 minutes to get started, and you will be blown away by the simplicity of the systeam and quality/profitability of consumers you will acquire.

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