‘Business’ - Category Archive

 

5 Genius Advertising and Marketing Moves

September 23rd, 2010

5. Groupon

Let’s start here, with Groupon.com. From obscurity to the front page of Forbes, Groupon poses to become the fastest company to be earn $1 billion. They are already valued at over a billion and have close $500 million in revenue in less than 17 months. Their model is brilliant, and as anyone would explain, its a win-win-win for everyone involved. Yes, businesses must offer exceptional discounts on their products and services, but in exchange, they garner new and unexpected customers, while only paying when they actually make a sale. The consumers benefit for lower prices on items they already purchase, as well as inexpensive introductions to companies and products they may have been interested in buying, all without the hassle, hustle and head spin of most modern marketing. An email arrived each day offering a new and different deal. They just need to decide if they want to buy or not. And finally, Groupon has managed to make out extrodinarily well. They sell other peoples products for them, thus getting a cut of the revenue for acting as the marketing department. They acquire hundreds of thousands of leads for free or extremely cheap because they are offering an unlimited number of products at discounted rates. They even have divided they reach into cities communities to squeeze not just large corporations into the game, but to help small businesses shake the local community for potential customers.

4. Generic food in improved packaging

This one might be debated by some, but my stance is firm. Generic food in grocery stores around the country was (and in some cases, still is) horendous looking. So while some may argue that you are what you eat, package designers will argue your food will taste like the wrappers they came in. Poor product packaging has been the leading cause of lost sales, while other products have risen from bottom shelf dwellers to end-cap displays just because of excellent package designs. There was even the recent Tropicana redesign revolt that prompted the company to revert to it’s original design.

Safeway, for example has done an excellent job in designing their generic food line. I believe this effort is quite profitable. First, the only requirement of the generic food is that their price remain cheaper. Second, if the consumer is unfamiliar with any of the brands, the generic appears on equal playing fields without have spent a dime of advertising. Third, while coupons and sales will occasionally reduce popular brands to lower than generic prices, as long as the generic foods are cheaper, they will be viable alternatives. All the businesses have to determine, is how close they can get to the signature brands prices before their demand drops, an easy calculation given that they are the ones selling all the products. Sure makes it easy to determine price points and which foods should be next in line for a generic offering.

3. Sex in the City

Countless episodes and two movies later, Sex in the City is still selling. And not cheap kids toys like Disney movies or Homer Simpson posters. They created a show that not only offered product placement, it revolved around it. Shoes, dresses, bags, bars, restaurants, even the latest vodkas have been featured endlessly on the show. Most product placements in TV and movies are annoying, awkward and down right obvious, but Sex in the City offered a unique spin on the concept. Overkill? Offend? Nope. Often. They regularly showcased new shoes and dining hot spots that became ubiquitous with the show that the viewers didn’t mind at all, they loved it. From an outsider’s perspective, the show could look just like a giant commercial with four uniquely attractive and distinct female models pitching product after product loosely spun around attracting men and having fun in the city. Classic consumerism in high heels.

2. Radio Hosts as product pitchmen

I never understood while this didn’t happen sooner. Talk radio is apart of the radio sphere. Some listen to radio less and less with the ease of mp3s, but commutes aren’t getting shorter for everyone. Radio DJ’s have long been apart of the rush hour or just the general relaying of news that matters to people with your taste in music. However, only recently have these same voices now been hired by companies to vocalize their wares. I’ve heard Djs hammer on about Five Hour Energy drinks, Subway sandwiches and even Stamps.com. The genius is that to the lazy ear, you only wait for the commercials to flip flop through the channels, and if the voice over the air doesn’t change, you might just listen straight through a block of radio host product pitches. It’s easy enough to get these folks to do a radio commercial, they’re already at a studio regularly, they have the voice for it, obviously, and need little extra incentive besides financial compensation for reading your 30-second ad.

1. Google Adwords

“THE game changing” as quoted recently on CNBC’s “Inside the Mind of Google”, Google Adwords has placed the power of customer acquisition in the hands of anyone with a computer and internet access. Use it to sell your company’s products or services, to run an affiliate network, to evaluated effective landing page designs to determining just the right headlines for a full-scale marketing campaign. Adwords allows the unknown to become a link right alongside the most relevant. Once only high price budgets could play in the space for certain markets, Google has leveled the field to endless keyword combinations, allows users to determine their budgets and bids and they have raked in ridiculous profits while customers learn the ropes of the program, improve the sales funnels and eventually cash in or crumble to the increasing competition. Google makes 98% of their profit from Adwords alone. 98%. This is their only business.

Confederate Motorcycles

November 7th, 2009

Motorcycles are machines. They offer transportation and supply functionality to their commander. But they are also independent creations. Marvels of their engineers and owners. They are the output of hours of consideration, crafting and creation, of welding, oiling and inking.

So when I first saw a picture of a Confederate motorcycle, I was stuck by the railyard ruthlessness and industrial inspired construction of these machines. They appear conceived not from a director’s chair in Hollywood, but from a revolutionary living in a left-for-dead town as he struggles to put pieces and polish on scrap metal and left to his warehouse and his genius creates an unapologetic beast that breathes fire and design and looks like no one else. And I want one.

The current year’s production include the Wraith, the Fighter and the Hellcat. My personal favorite is the Wraith, although I’ll have to wait a few years before I can cash my entire 401k to cover the $92,000 list price. What strikes me about Confederate, besides their mission statement to “deemphasize volume” which feels sorta throwback American in its effort to sell fewer, higher priced items than the consumerism jungle created by Sam Walton is their ability to actually maintain a business.

Confedearte - Wraith

Confederate - Wraith

I’m all for expensive toys. And I’ve already admitted that I’d love to ride one of these untamed wildebeests. But what this tells me is that while functionality is important, I’m sure the 1967cc engine fires on the first go, that the chain powers the rear wheel and that the bike certainly lunges forward, design, from concept to visual, thought to appeal carry a very real sense of value. So while not everyone may be in agreement over the Wraith’s design, there is a truth to how design affects our decisions, attitudes and perceived worth. Car manufacturers continue to roll out almost identical designs with Siamese-like trim and engine options, but motorcycles have found a way to transcend this monotony with unique approaches to the same problems.

Nesbitt, of Confederate comments,

But I’ve come to realize what I was yearning for was to study vehicle design, which they didn’t have in the curriculum and I didn’t know to ask. But I’m so fortunate I didn’t find out it existed because if I’d run through the mill like everyone else I’d wind up doing stuff like everyone else’s, too. My design approach is much more art-form-based, more inspirational.”

– JT Nesbitt

Confederate - Hellcat

Confederate - Hellcat

Artful and inspirational for sure, and even thoughtful. Matt Chambers, the founder of Confederate Motorcycles, even writes great articles on the company’s blog.

Confederate Motorcycles is a fresh reminder of the new America, the idea that copying only creates more of the same, that craftsmenship is a dedication to building a better planet and that innovation as a concept is for everyone even if the final product is only in the hands of a few.

How to Determine a Domain Value

October 22nd, 2009

Recently in working with a client who wanted to acquire a .com domain, I spent some time doing research into the rules and (lack of) regulation into the expired domain name reseller and auction marketplace. Mike Davidson offers a great article about how to snatch a domain name and highlights the big players.

The three services are Snapnames.com, Enom.com, and Pool.com. They all operate in a similar manner, pounding the VeriSign webservers during the “drop” period to secure the requested domains to then resell them in their own auctions. Each company operates their auction differently, with Pool.com working more like entertainment shopping at Swoopo.com than a typical ebay auction, sucking you dollars faster than a hoover. This whole process, mostly void of much domain oversight and regulation quickly led me to question, what is the value of a domain.

1. Clearly its worth something to someone

With at least these three sites, and their many domain brokers that live between them and your email inbox, there is clearly a demand, and thus a marketplace for these expired domains. With mountains of data I’m sure you could determine the value of a 5-letter domain name ending with .com, or a .net of a valued .com property. I’ve heard from someone who works with a Spanish domain holding company that  their 2 million plus domains is the full source of their business revenue

2. Not all domains are valued equally

Anyone in SEO will tell you that an  inbound link from a .edu or .org is more valuable which will drive up those domain name values. Also, short 5-letter domains or domains that are easy to spell, remember and tell someone will also drive the price up.

3. Domain names are like property and tickets

Some addresses like Park Ave. or Michigan Ave, or certain neighborhoods hold a much higher property value; some tickets are next to impossible to buy on their release date and you’re left shopping at craiglist or stubhub to pickup your coveted seats, domain names are like both. They have a finite supply. They don’t rollover frequently. They are many buyers for the same item. They can hold value, increase in value and have reseller value on the open market.

With these variables, and the desire to pickup a domain name, how do you determine the value of a domain in order to justify your purchase?

Here is how I would approach this process.

  1. Do I currently own the .net alternative or any web 2.0 misspellings of the desired domain?
  2. Do I currently generate revenue from my existing website?
  3. Do I have an online marketing budget?
  4. Is this for a business?
  5. Does the desired domain have any left over SEO value?
  6. Will I own this domain for the next 5 years? next  10 years?

With every “Yes” to the above questions, the domain has greater and greater value to me. Given that I might have to shell out a chunk of cash right now for the domain, I will look back in several years and see that my investment into this “property” will pay for itself.

1. I own the .net or similar domain name spellings
You may be losing traffic to your site as visitors are unsuccessfully attempting to find you at the more common .com name. This lost traffic might be determined by mining your keywords searched that include your domain with the .com. You can use the value per visitor equation, or your site’s conversion rate to help determine what that boost in traffic would be worth, and don’t forget to determine time as one of your variables. This feature alone might tell you that paying $500 for your domain is totally worth it.

2. I generate income on my existing site
If you’re making money now, how can you afford to lose business to someone that might snatch your .com domain? They might sell it to a competitor or charge your more in an offline domain deal that will cost you more in the long run. How would more visitors and traffic hurt your site? This domain should be bought within reason, but if you’re already making revenue from the site, you should see this as a necessary infrastructure cost.

3. I have a marketing budget
Move your budget around to purchase the domain. Getting a good domain is worth several hundreds spent on SEO and PPC. It might also drive traffic from word of mouth and other offline marketing efforts where memory plays into the value of a name.

4. It’s a business site
Expense it. This is a cost of doing business, but it’s also the future of business. Homepages like Amazon.com and United.com are the face of these businesses. Their homepage is indispensable. Owning these domains is surely calculated by the appraisals into the value of the business. Matching your company name to your domain name is an essential tool to secure your brand and your company’s perceived perception.

5. The domain has inherited SEO value
I have a colleague who has purchased domains with inherited SEO value for just that reason. He is able to take a site that has traffic and rank and turn it into a small cash cow thru adsense, traffic funneling, and even 301 redirecting to push up another domain. If the domain has SEO value, you will be buying valuable optimization built-in. It’s like getting a free upgrade to the leather interior, the box seats, the in-dash DVD player with navigation.

6. I plan on owning this domain for awhile
A dollar today in five years will be worth a lot more, spent or saved. Inflation, demand and lost traffic will all play a factor into determining value. If you hold the domain for 5 years at $10 a year, that’s $50 plus whatever you spend on it now. If you know you will hold on to the domain name, buying it sooner than later will always make more sense (and cents). However, if you spend that dollar on your domain name, not only do you now own something, you have a chance to build more value into this property and even resell it yourself later on, with or without the business attached to it.

Overall, I would generally land on the “buy” side of this investment opportunity given a few “yeses”. Considering the number of players and brokers in this industry, my guess is that I’m not alone in determining that domains have value, that their value can grow and that with demand and lack of supply, this business isn’t going anywhere.