Smashing Blog

The UK advertising market is tipped to grow at a slower rate in 2012 than previously expected because of a slump in print advertising, according to ZenithOptimedia.

The media agency network has revised its 2012 ad expenditure growth forecast to 3.2%, down from the 3.7% it had predicted in December. Ad spend in magazines is expected to drop 1.9% year on year to £822m, while newspaper expenditure is predicted to fall 1.7% to £2.5bn.

The shortfall is largely due to supermarkets - traditionally among the biggest spenders on newspaper and magazine ads - decreasing their spend in press by 25% year on year, as retail sales remain flat.

Banks are expected to spend 36% less on press this year.

Jonathan Barnard, head of forecasting at ZenithOptimedia, says while banks spent “a huge amount” on brand campaigns in a bid to boost their images in the wake of the financial crisis, spend has now shifted to smaller, more product-specific campaigns.

Elsewhere, the TV sector has performed above expectations in the first quarter of the year and is sitting just 1% below quarter one of 2011, despite many predicting landslide declines, as the finance and motor sectors increased spend on the channel. The sector is expected to grow 1% to £3.3bn in 2012.

Internet ad spend is set to be the biggest growth area, with expenditure predicted to increase 9.3% year on year to £4.1bn in 2012.

MySpace is partnering with Panasonic to launch a social television service in an attempt to revive the once popular social network.

The service, dubbed MySpace TV, will allow users to discuss the programmes they are watching, discover new content and join fan communities via Panasonic Viera Connect-enabled TV sets, the companies announced at CES in Las Vegas yesterday (9 January).

MySpace chief executive Tim Vanderhook said: “Historically TV has been a shared experience, as people gathered together to watch their favourite programmes.
“Our belief was that we could enhance the TV experience by increasing viewers’ ability to connect to both content and each other.”

Launch channels on the “over the top” service will play to MySpace’s traditions of being music focused, using the site’s library of music videos and songs. Channels are expected to extend as the service rolls out to include sport, documentaries, news and films, the companies said.

Smartphone and tablet apps will also become available so that users can access MySpace TV when they are away from their Panasonic Viera TVs.

Sky took a 10% stake in start-up social TV service Zeebox yesterday (9 January) to allow the broadcaster to integrate the technology into its mobile app portfolio. Zeebox also allows users to discuss TV programmes in real time.

NewsCorp - which also has a stake in Sky, which it was bidding to take full control of before the News of the World phone hacking scandal - sold MySpace to ad network Specific Media for $35m (£21.9m) last year.

This was just a fraction of the $580m (£363m) Rupert Murdoch’s company bought it for in 2005, when it was the most popular social network and before rivals such as Facebook and Twitter gained momentum.

Specific Media, along with Justin Timberlake, who it has deployed to front the social network, said last year it plans to “evolve MySpace into the premier digital destination for original shows, video content and music”.

Why Generic Keyword Domain Names are so Valuable to Businesses
Many businesses today are simply missing out on the power of keyword domains and the role they play in strategic marketing. While some companies are sitting on the sidelines, sticking to their outdated traditional marketing strategies, other companies are quickly gobbling up all the best generic domain names related to their products, services, and locations. They realise they can bolster their marketing and advertising performance while erasing potential assets from their competition.

Many companies have no problem investing capital and resources into product development, management, infrastructure and staffing etc., but very few have the knowledge and understanding of the power of keyword domains and just how important harnessing the power of those domains can be to their overall marketing strategy.

Why Are Domains So Important?
There are many reasons why domain names are important. They can impact the amount of traffic you receive to your website. They play a major role in where your websites rank in search engines. They affect the consumer’s perception of your brand.

Savvy investors were quick to snatch up all the one word, category defining domain names and bluechip corporates have paid huge sums of money to acquire the best domain names for their industries. For example, Motorcyles.com is owned by Honda, Insurance.co.uk is owned by Lloyds TSB Insurance Services, Holidays.co.uk is owned by FirstChoice, and ASAP Ventures Ltd (an online car rental company) paid £150,000 for Recycle.co.uk.

While almost everyone can see the value in owning a one word, generic domain name, most people do not realise that two word and three word keyword domain names can be just as effective. In fact, these “long tail keywords” can be even more effective because they are more specific and more targeted and many companies don’t realise these domain names can be acquired for very reasonable prices. They are sitting there, ripe for the picking. But it’s just a matter of time before their competitors come along and pick the vines clean!

Benefits of Keyword Domain Names
Acquiring exact-match keyword domain names provide many benefits. First of all, they can capture pre-qualified, targeted leads without any SEO and without any web rankings. A lot of people still type their search terms directly into their browser, and a percentage of those people will type their search with a .com or .co.uk into their browser. For example, rather than going to Google and searching for “restaurants in London” a certain number of people will simply type in restaurantsinlondon.co.uk into their browser first, to see what’s there. The restaurant owner who had enough foresight to buy that domain name reaps the benefits, while all the other restaurant owners in London can only hope to show up in the search rankings.

A second key benefit of keyword domain names is increasing organic search traffic. One of the many factors in the algorithms of the main search engines such as Google, Yahoo, and Bing is the domain name itself. Exact-match keyword domain names are considered to be the most relevant, and as a result, websites with keyword domains tend to rank higher than websites without keyword domains for exact match searches. In fact, the Search Engine Ranking Factors report for 2009 (an annual survey of experts in the SEO field) ranked keyword use in the root domain name as the third highest ranking factor for on-page optimization.

A third key benefit of keyword domain names is increasing click through rates. People are more likely to click on your website if they see a keyword domain in the URL when compared to other URL’s that show up in the search results. Even if you are buying CPC ads from companies such as Google Adwords, more people will click on your ad links if they see a keyword domain for the URL. A UK company called Memorable Domains recently conducted a study which showed that when used for pay-per-click advertising, use of a generic keyword domain over a non-generic, non-keyword domain increased the number of ad impressions and raised the click-through-rate of ads by as much as 42%. Because keyword domains can effectively lower the long-term costs of marketing while simultaneously improving the net results, acquiring domains for those keywords for which you are already paying to rank for in search engines, or to advertise for on pay-per-click programs can save you a lot of money.

A fourth key benefit of keyword domain names is building brand recognition. Consumers naturally associate generic keyword domains with market leadership. For example, if a consumer looks for Service + Location and they find your website
(eg. propertyinoxford.com or chesterlawyers.co.uk), they assume you are the market leader for that service in your location. It gives you instant credibility.

What’s Wrong With Your Current Domain?
Now that we have covered the many benefits of keyword domains, let’s take a look at the flip-side. Many businesses make the huge mistake early on of buying ONLY their company name as their domain name. For example, they buy a domain such as SmithandWatson.co.uk. This is especially true with law firms. First of all, you SHOULD own the domain name that matches your company. The problem is many businesses stop there. If someone knows about your business and searches for “Smith and Watson” you will be fine, but what about all the potential customers who don’t know about your business? They will never find you! You need additional domains to cover all the bases. You should own the location + service domains for all of your products and services for each geographical region you serve. By doing so, not only will you reap the benefits, but you will also block your competitors from achieving the same thing.

How Much Are Keyword Domains Worth?
To answer that question, let’s put it in perspective. How much is a lead in your business worth? Let’s say you are a lawyer. One new client might earn you £3000. He may become a repeat client. He may refer other people to you. That one lead could be worth a small fortune to you. Wouldn’t you pay £1000 or more to own the domain that brought that pre-qualified, targeted customer to you? Of course you would.

Many companies have no problem throwing thousands of pounds into billboard ads, magazine ads, newspaper ads, television commercials, and radio advertisements. That is fine, but there is one big problem with all of that. People can’t click on a billboard ad, magazine ad, newspaper ad, TV commercial, or radio ads. That is why the internet will always be the king of marketing. When it comes down to it you really have no idea how many customers traditional forms of advertising bring in. Savvy businesses are starting to take out a chunk of their advertising budget from traditional marketing methods and invest that money into generic keyword domain names.

Conclusion
Generic keyword domains have many benefits and can be a much more cost effective way of acquiring pre-qualified leads for your business than traditional marketing practices. While you take advantage of those benefits you can also prevent your competitors from gaining leverage on you by acquiring the domains for themselves. Generic keyword domains are like virtual real estate, and you can own all the best properties and create a monopoly. While you capture targeted leads your competitors will be left out in the cold.

The customer experience champion is always right: marketers who champion the customer’s experience have a golden opportunity to make their mark in the boardroom by improving their brand’s bottom line.

Harry Gordon Selfridge, founder of the luxury store that bears his name, summed up the importance of flawless service when he reportedly coined the phrase “the customer is always right” at the start of the 20th century, but it has taken more than 100 years to make a link between customer experience and the bottom line.

Although a weight of evidence now exists to demonstrate the two are inseparable, it appears to have reached too few boardrooms. As Mike Ashton, former senior vice-president for international brand marketing at Hilton, puts it: “You have only to look at the companies that stand out for doing this to realise they are the exception, not the rule.” With marketers largely in charge of managing consumer relationships, how can they convince corporate boards that improving customer experience will pay dividends?

Ashton spent 18 months gathering evidence from 250 hotels to show that investing in a positive experience for customers would boost Hilton’s bottom line. Part of this exercise involved demonstrating to the board how much money the company was losing through poor customer experience.

The resulting ’transformation programme’ eventually made Hilton number one in every market outside the US (see Case Study, below). And the hotel operator is not alone in putting resources into managing and measuring customer experience. Businesses such as Nationwide, More Than and TGI Friday’s are also looking at how the experience their customers have with them affects the bottom line, whether that be through a call centre, meeting staff or on a brand’s website.

Plenty of evidence exists to show that satisfaction with the customer experience is linked to profitability. For example, twice as many car dealerships with low satisfaction scores went out of business in the recession as those with high scores, according to figures from Maritz Research.

Its research also shows that 55% of people who are happy with a sales experience will pay for the same dealership to service their cars, but only 35% of dissatisfied customers would go back to a dealership they weren’t satisfied with.

Ashton, now managing director of consultancy ABCG, agrees that smart companies will want to create an experience that meets or exceeds the customer’s needs and expectations in a way that is “profitable, operationally deliverable and sustains a point of difference in the marketplace”.

Internal struggle

Nationwide introduced a tracker to measure how satisfied people are with its service in April 2010. Head of customer marketing Alex Bannister says there is still an internal struggle for businesses to get the boardroom to understand how important a customer’s experience of the brand is.

Marketers should be well placed to point out the business benefits of a high-quality customer experience, given they are the ones who most appreciate what customers want. Arguably, marketers should also be responsible for the promises brands make about their service and as such should be aware of the perils of failing to meet them.
Yet, despite it being cheaper to keep a customer than acquire a new one, Ashton says marketers often struggle to convince their organisations that the cost of ensuring a consistent experience is an investment in ongoing profitability.
“Few marketers are sufficiently influential within their respective businesses at board level to be able to create a robust business case and a workable operational model that will galvanise an organisation,” he argues.

The marketers that can persuade the board of the importance of customer experience are seeing undeniable results. Hilton has achieved year-on-year growth in membership of its HHonors loyalty scheme, which was relaunched this March to focus more on guests’ experiences rather than simply collecting points. Scheme members now contribute more than 45% of the hotel company’s overall revenues.
While loyalty schemes can help create happy customers, other brands have found they need to focus on making their core proposition match the service they offer.

Meeting expectations

For example, More Than uses its marketing to suggest it is ’more than’ just an insurance provider, but it found that only 52% of its car insurance customers were satisfied with the general service they got when it carried out a survey in August 2010.

It also found that only 44% of customers were satisfied when they renewed their car insurance and that only half said the company had fulfilled their needs first time (see Q&A, below).

This led the business to question whether its core proposition actually met the expectations it had created. A particular cause of frustration, More Than found, is “first-contact resolution”, or solving customers’ problems first time without them needing to call back.

More Than’s survey drew links between first-time resolution and satisfaction, and between satisfaction and insurance policy renewals.

According to RSA Group chief marketing officer Pete Markey, who oversees the More Than brand, there must be a balance between the experience someone has with a brand and what their expectations are. He argues that the equation is not as simple as either promising what you can deliver or matching your delivery with what you have already promised. “It is somewhere in the middle. Do you wait to be perfect before you communicate? Obviously not. You have to be true and have integrity in what you are promising as a brand and consistently deliver that.”

More Than has seen first-contact resolution and satisfaction rates rise since devoting more attention to call centres.

Focusing on the customer experience is equally important for brands that offer a face-to-face service. Since being bought by a consortium of investors in 2007, restaurant chain TGI Friday’s began measuring how customers experienced its outlets. Overall satisfaction improved by two-thirds between 2006 and 2010, and the business claims it is now seeing compound sales growth ahead of the market (see Case Study, below).

That turnaround was prompted by the fact that satisfaction was at just 35% in 2006 and the business had to decide whether the American diner atmosphere at the heart of the brand was still relevant. It realised that to maintain its premium pricing and remain popular, it had to invest in training restaurant staff and revamping its venues.

However, for some brands, not promising much can mean that customers feel more satisfied with an experience than they thought they would. For example, low-cost airlines might get fewer complaints than those brands whose image is more premium.

One such carrier, Ryanair, claims to have the lowest complaints rate of any European airline, with 0.57 complaints per 1,000 passengers in August and 99% of these “resolved within seven days”. But it could never be accused of setting expectations of the customer experience too high, given chief executive Michael O’Leary’s periodic threats to charge for ice cubes or for using the toilet on the plane.

Ryanair’s head of communications Stephen McNamara agrees that the brand is not shy of negative press stories, but says it focuses its marketing on “price and punctuality” as opposed to the quality of the experience on the plane and in the airport.

“We never miss an opportunity, and from time to time engage in ’guerrilla’ marketing to garner quick and easy publicity. But our customer surveys consistently show that over 50% of our passengers fly with us four or more times a year.”

Lowering expectations is not a sound marketing strategy for most businesses, however. The more likely task for a marketer is to justify the promise being made and to make the argument within the business for why this must be met. As Eurostar sales and marketing director Emma Harris summarises: “A business’s brand positioning should be built on competitive advantage, and to deliver on that competitive advantage the experience must be consistent with the brand.”

Eurostar began a review of its customer experience in 2008 to assess whether its “service personality” reflects the “pioneering spirit” that Harris says is at the centre of its branding.

Call centres were identified as an area with particular deficiencies, she adds, because the way staff were being rewarded and measured didn’t match the customer experience being communicated by the brand. Eurostar threw out all of its scripts and call centre staff are now measured on building rapport with customers, rather than on call length or how much they cross-sell or upsell.

Call centres

This might seem like a recipe for increasing costs without any measurable benefit. But a poor experience in a call centre is likely to cause a customer to take their business elsewhere, according to research into mobile phone operators by Maritz. Half of all bad experiences that cause a customer to leave a brand happen in call centres (see Make or Break Experiences, below), indicating that it would be foolish to skimp on delivering a consistently good customer experience in this area.

Marketers are probably well aware that cutting down on the customer experience is often a short-sighted strategy, especially since a company has nowhere to go once costs hit rock bottom. But without presenting hard evidence, they will not be equipped to demonstrate why it is important to invest.

Regulated industries such as water have a more formalised approach to gathering that evidence. Water regulator Ofwat’s Service Incentive Mechanism (SIM) determines how much the regional monopoly suppliers can charge. It contacts 200 customers every quarter for a qualitative study and also assesses complaints and repeat or abandoned calls by customers.
Veolia Water uses a text message system from customer insight company Rapide to get feedback from its customers, giving it a picture of its performance between surveys. Every customer who contacts the company is sent a text message asking whether they would subsequently recommend it on a scale of 0-10. Those scoring 0-6 are called back, since a low score means a customer is more likely to need to make a repeat call or complain.

According to Veolia Water marketing manager Morag Kent: “Most customers do respond, and we get really faithful results out of it; so much so that we are using it to predict our SIM scores.”

With Veolia Water, the customer experience is embedded in its operations, since it helps determine profitability. But where responsibility for customer experience lies varies between companies. In some, there is a dedicated customer experience department, in others marketing will take the lead and in others it could be operations.

The businesses that do invest in putting customer experience at the core of their profitability seem to have two things in common - consensus at board level that the experience must meet the expectation, and the ability to communicate this to all members of staff.

At Nationwide, for example, there is no specific customer experience function within the building society, even though it has set a target of beating all other high street banks on this measure and has begun publishing complaints and service tracking data on its website to prove it.

Instead, the goal is embedded throughout the business. It is a structure whose efficacy depends on one fundamental question, Nationwide’s Bannister says. “Is there a good line of sight between the strategic objectives at the top and the day-to-day operations and conversations with customers? It is quite easy for someone to have a vision at the top, and for it not to reflect what is going on on a wet Thursday morning in a branch or call centre.”

In many organisations, no department has greater incentive than marketing to ensure that this line of sight exists. Marketers are responsible for making the brand’s promises, so they must also take responsibility for keeping them. But to show the business the importance of doing so, they must use hard evidence to get the support of staff in every discipline and at every level, from the board downwards.

Companies that continue to invest in marketing despite uncertainty over the state of the economy will benefit from improved market share in the long-term, according to the authors of the latest IPA Bellwether report.

The advice comes as the report showed marketing budgets were set higher in the third quarter as companies spent heavily on direct response channels such as DM and sales promotion to boost volumes.

More than a fifth (21%) of the 300 marketers polled revised their budgets up in the fourth quarter, compared to 17% that cut spend. The net balance, 3.4%, is an improvement on the 2.2% registered in the second quarter.

Chris Williamson, chief economist at financial information service Markit and author of the report, says that investment in direct marketing and sales promotion by brands looking for a short-term volume increase “in the face of weak demand” helped lift spend.

Retailers, driven by the major supermarkets, have been investing heavily in price cuts to entice reluctant shoppers struggling with rising bills.

Increased marketing spend lifted marketers’ confidence in the prospects for their own company, Bellwether found, but fear of a double dip recession and a further drop in consumer confidence damaged belief in their own sectors’ prospects.

More than a third (39%) of the marketers asked said the outlook for their own industry was worse than in the previous quarter, while 16% reported an improvement. The net balance, -23.3%, was down from the -10.9% reported in the first quarter.

IPA president Nicola Mendelsohn urged marketers to continue to invest in marketing despite uncertainty over the state of the economy. She adds: “It is important that the advertising industry should do all it can to be as upbeat as possible to meet the challenge that we face.” This rise in spend demonstrates that many companies are trying to buck the downward trend.

“It is a move in the right direction and shows that businesses understand that those that maintain the strongest marketing spend will come out on top.”

Smashing Publicity are looking for a quick and efficient WordPress freelancer to come in to the office for a couple of days a week to build out a portfolio of domains with relevent links/affiliates/seo.

Must be a fast worker. Working with a clear format there might be a dash of repetition, so will need staying power.

Hourly rate.

Marketers need to be aware of the different policies of the four main social media platforms regarding hosting campaigns, warns the Direct Marketing Association (DMA).

Facebook, Twitter, LinkedIn and YouTube all have different requirements regarding the hosting of marketing promotions, games and apps and the platforms have the right to exclude campaigns for not meeting their criteria.

The DMA is launching a new free service for its members, the Social Media Helpdesk, to help with assessing these criteria.

DMA head of legal and compliance services Richard Evans says that the DMA Social Media Helpdesk will help marketers avoid making costly mistakes.

He says: “Marketers need to do their homework on these conditions and restrictions, or else they run the real risk of producing work that platforms refuse to host. We’re aware of a number of companies that have been left out of pocket because of their ignorance of platforms’ marketing policies. Our helpdesk can help marketers avoid rushing into creating a social media campaign that falls at the last hurdle.”

UK companies spent £132m on social media marketing during 2010, 14 % of total expenditure on online display marketing, according to the Internet Advertising Bureau data from March this year.

LinkedIn has reported strong revenue and profit increases in the second quarter, in its first financials since it became the first major social network to be publicly listed.

Revenue was up 120% year on year to $121m (£74m) in the three months to June. Profit was up to $4.5m (£2.8m), compared to $4.3m (£2.6m) in the previous year.

Hiring Solutions, LinkedIn’s biggest earning division, which allows companies to place job ads and contact potential candidates, increased revenue by 170% year on year to $58.6m (£35.9m).
Marketing Solutions, which allows brands to place display ads on the site and set up their own company pages, accounted for 32% of LinkedIn’s total revenue. Revenue increased 111% year on year to $38.6m (£23.7m) in the quarter.

Revenue from Premium Subscriptions to the site totaled $23.9m (£14.7m) in the period, up 60% year on year.

Overall, global memberships - free and paid for - grew to 115.8 million in the quarter, up 61% on 2010. By contrast, Facebook, which is also said to be mooting an IPO, has more than 750 million members.

LinkedIn went public in May, reported to value the company at about $3.3bn (£2.03bn), a valuation that some analysts said was “lofty” at the time. The strong results - and unexpected profit - are likely to be a relief to investors, who had been warned they were investing in the web’s second “dot com bubble” and could potentially lose their cash.

Jeff Weiner, LinkedIn’s CEO, says: “Going forward, we plan to continue to invest in our team, technology, and products in order to increase the value we deliver to members and realise the full potential of the LinkedIn platform.

Weiner warned that the LinkedIn will not be profitable for the full-year as the company invests in expansion and launching new products.

Almost half of UK consumers are not interested in buying products via social commerce, such as Facebook stores, according to a study.

The study, conducted by Havas Media Social and Lightspeed Research, suggests that despite the retail industry hailing social commerce as the “next big thing”, 89% of people have not bought a single product through Facebook and 44% are not interested in doing so.

Retailers and brands including HMV, Asos, Bulldog and French Connection have all launched Facebook stores in recent months.
Consumers cite a lack of reassurance about security as one of the main reasons they would choose not to shop via a social network, highlighting the need for more consumer education about social commerce.

About two thirds of consumers (65%) say they would not be willing to buy big ticket items via social networks and would only be prepared to spend between £1 and £50, with only 6% of people saying they would be willing to buy a holiday on the platform.

Product exclusivity is the key factor in persuading consumers to purchase products via social networks, with one quarter of consumers saying they would buy a product through Facebook if it was not available anywhere else and 11% saying they would buy something if it was offered only to “fans” of the brand.

The majority of consumers (70%) also feel that targeted advertising based on interests or shopping behaviour, similar to Amazon’s model, would make them more likely to buy products on social networks.

The most preferred place for consumers to redeem special offers, regardless of if the offers were advertised on Facebook, still remains the brand’s official website.

Amy Kean, director of social media for Havas Media Social, says: “Based on industry predictions and the rate of innovation in this space, social commerce is likely to become a reality - but there’s still a lot more work for brands to do to help consumers get their heads around it. It is the understanding of social behaviours - not the technology - that we need to prioritise.”

The study represents the responses of a survey to a representative sample of 1,007 UK social networkers.

Brands have been handed the chance to use their website domain name as a marketing tool after internet regulator ICANN approved plans to create hundreds of new monikers.

From next January, companies can apply to ICANN for any domain name they wish in a language of their choice, for a fee of $185,000 (£115,000). The move means businesses around the world will be able to apply for their own web real estate to market their brands.

Currently there are 22 internet domain names (also called generic top-level domains) including .com, .org and .net. Now brands and companies can select their preferred domain name, which could see URLs such as .nike, .apple and .coke.
Peter Dengate Thrush, chairman of ICANN’s board of directors, said, “Today’s decision will usher in a new internet age. We’ve provided a platform for the next generation of creativity and inspiration.”

ICANN is to launch a global campaign in the coming weeks to build awareness of the changes being made and the opportunities that will arise from them.

Applications for new domain names will open on 12 January 2012 through to 12 April 2012.

The ICANN board vote is the culmination of a six-year negotiation process conducted with the internet businesses and governments.

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Although the above is probably good news for the uber brands and their ego’s it doesn’t offer much for the SME or joe public. If joe public (jp) wants to find Nike, Apple or Coke he already knows where to find them!

The good news is that generic keyword domains will still be as effective as ever and hold far more value to the SME especially in niche markets where brands are fighting for business rather than just fighting for brand bragging rights.