Today’s topic of discussion is Free Shipping.

According to ComScore’s State of the U.S. Online Retail Economy in Q2 2010, half of consumers say they’ll abandon their shopping cart if free shipping isn’t offered and a quarter will only buy when free shipping is an option and 90% won’t pay more than $10.

Put another way, 51% of consumers are at least ’somewhat likely’ to cancel their entire order if free shipping is not offered.

If free shipping is not part of your holiday e commerce repertoire, then you may want to consider special pricing, future discounts, or rewards/incentives as an alternative. 66% of consumers would be more likely to continue their purchase if special pricing or discounts/rewards on future purchases were offered by retailers.

Happy Holiday Planning!

Overview/Key Features of the Release

CRAWL TIME AND INDEXING - Results will be rendered faster (speed is touted to be doubled, and the index size will be much larger); Google is completely rewriting their indexing system to crawl sites faster and index more efficiently.

KEYWORDS – Caffeine will have a large focus on keywords and relevancy is a key factor of the release.

FRESH CONTENT - Keeping content fresh is a major focus; content updates should be frequent and thoughtful (i.e. written for the reader, not the search engines) as these updates will start to play a larger role (fits nicely into their goal of crawling sites more frequently and indexing more efficiently).  Expect to see new pages show up in the index faster than ever before.

LINKING and WELL STRUCTURED CODE - Links still play a key role; they should be directed to pages/sites that are easy for the spiders to crawl.  Therefore, coding efficiency will play a huge role.  Pages need to load quickly, be coded properly and architected in a way that makes it easy for spiders to crawl (and of course, the pages must have unique and relevant content).

DUPLICATE CONTENT - Duplicate content will be more aggressively filtered (i.e. if two pages are almost identical, expect one of them to be filtered out).

FOCUS ON NEWS and SOCIAL MEDIA/REAL TIME RESULTS - Will give more weight to news and social media results; the spiders will be crawling faster so they’ll be able to grab hot topics from news and social media.  Blogging, press releases, editorial content, etc., will play a much larger role in terms of content updates.

The Buzz

RANKINGS - Speculation is that rankings are unlikely to fluctuate much when Caffeine is rolled out as it is primarily an “under the hood” upgrade to Google’s search algorithms.

o Websites that lose rankings are probably relying on older content that hasn’t been updated in recent years.

SITE SPEED – As mentioned above, this is speculated to be a part of the algorithm.  Sites must render quickly; there’s a lot of crawling going on and the spiders need to do it quickly and efficiently.

Timing

Although the information available on this is vague, according to Matt Cutts, it is supposed to go live in one of Google’s datacenters (the implication was that this may have already happened) and that rollout to additional datacenters will happen “after the holidays”.  He indicated he “wouldn’t be surprised” if they gradually roll this out one datacenter at a time.

It happens every year, I plan to get all of my shopping done well before Christmas but somehow it comes down to the wire each holiday season.  Apparently I am not alone.  According to the National Retail Federation, fewer than half of shoppers had completed their shopping by the end of last week and 19% hadn’t even begun to shop!

This state of consumer procrastination bodes well for both online and offline retailers as we count down the final few days before Christmas.  According to the same survey, nearly 40% of shoppers who have waited will shop online while the remaining 60% will shop discount and department stores.

There is still time for online retailers to capture the last minute shopper’s share of wallet.  Offer free upgraded shipping with guaranteed delivery by Christmas or perhaps a special weekend sale.  And be sure to get the word out by sending emails, running a paid search campaign and posting last minute offers on Facebook and Twitter.

The procrastinators are out there and we are desperately seeking merchandise to stuff empty stockings and fill the bare spaces beneath our Christmas trees.

Happy Holidays!

According to website sales tracking firm Coremetrics, Cyber Monday online sales were up by 11% over 2008, driven largely by consumers looking for deals and a greater number of people using the web to make holiday purchases.

As a digital marketing agency that constantly strives to help our clients grow their business online, we were delighted to see our clients’ results.  We analyzed sales performance across our client base which is comprised of fashion, beauty, luxury goods and home accessory retailers.   On average, Cyber Monday online revenue for our client base was up 41.8% year over year.

So, what did our clients do right?  They provided customers with engaging shopping promotions and employed the triumvirate of online marketing (Paid Search, Social and Email) to persuade shoppers to open their wallets and spread some holiday cheer.

Happy Shopping!

Now that Bing has been in the mix for a few months, I will say that it has gotten a lot of buzz in the search world. There have been mixed reviews, some positive and some negative. Users are speaking highly of the Quick Preview feature that allows you to preview any site. I personally like that the Related Searches and Search History is displayed in the left-hand navigation. Users are saying how fast the results come up, and it has even been said that Google is making adjustments to compete with its speedy search results. Just today, I read an article that discussed Google’s new AJAX search, designed to speed up the engine.

I had fun with a blind test tool, which generates search results from all 3 search engines, Google, Yahoo and Bing, and allows you to vote for your favorite result. In this blind test, I chose Google 7 out of 8 times. (The other time I chose Yahoo).

From a paid search campaign performance perspective, it is simply too early to tell how the new Bing engine compares to the old MSN engine. We looked at click-through rate and conversion rate data for our largest retail accounts and compared results pre-Bing to post-Bing and the data is simply inconclusive at this point. Regardless of whether Bing produces better click-through rate and conversion rates, however, the biggest challenge it has, of course, is to secure a larger piece of the search market share. That all remains to be seen, although so far market share is virtually unchanged (at about 3.1%) when you review it globally, http://marketshare.hitslink.com/search-engine-market-share.aspx?qprid=4&qpmr=100&qpdt=1&qpct=3&qptimeframe=M&qpsp=125&qpnp=3

I must admit that I am fairly skeptical that Bing’s new effort is going to make much of a difference to me or my clients running paid search campaigns. To me, it is simply a rebranding of an old search engine, albeit it one with some better features. And from my perspective, it is still simply a place we must advertise if we are to capture the 3% of the market that searches there. For some of our clients, 3% can translate into 100’s of 1000’s of dollars in sales each year.

We will keep an eye on natural results, as this may be where the real differences and Bing advantages lie…….

What is a Facebook Vanity URL?
It’s a URL that will include a legible company name, rather than the non-sense parameters and ID numbers that Facebook has been using to date. So, your fashionable shoe company that currently has a long Facebook URL (http://www.facebook.com/pages/Denver-CO/Lovely-Shoes-Official-Fan-Page/37248253610) would have a newer, prettier Fan Page URL that looks like this: www.Facebook.com/Lovely-Shoes/ 

This will help your organic search rankings, and it will make it much easier for your fans and customers to remember and type into their browser.

Learn more about this exciting new development from the official Facebook blog here:
http://www.facebook.com/note.php?note_id=91106469821

There are a couple of conditions that you must meet before choosing your username. You must have had your Facebook Fan Page live prior to May 31, 2009 and you must have a minimum of 1,000 fans as of that date. If you meet these requirements, make sure to choose your username at midnight (12:01am Saturday).

However, if you have a page, but don’t have enough fans yet, make sure to register your trademarked company name so that no one else can choose it.

Follow this link to register your legal trademark:
http://www.facebook.com/help/contact.php?show_form=username_rights

Recently we were asked to put a dollar value on a blog.  Certainly this is not the first time this question has been asked.  But how do you calculate the value of a blog?

For a retail website selling a product one could calculate sales <less> costs to get a estimated figure of how much the website is worth.  But how about a B2B website with a 9 month plus sales cycle?  Moreover how do you place a value on a blog for a law firm?

So faced with this question the answer is:  North of $1,200,000 and growing each day.

First we took a look at the Google analytics data.  Then to arrive at this figure we simply had to apply math based on the law firm’s billable rate.

Here is our calculation:

Take the average visitor time on the site (1:09) x 287,833 visitors x billable rate ($200 per hour) =  $1,045,793.23.

Then factor in 400 lifetime blog posts @ 2 hours x $200 per hour = $160,000.

Total value = $1,205,793.23 at $200 per hour.

If the billable rate increases to:

$250.00             $1,467,241.54

$300.00             $1,728,689.85

$350.00             $1,990,138.16

$400.00             $2,251,586.47

The intangible variables that are not included in the calculation are:

1)  Business to this particular law firm from website searches based on expertise of subject matter found and updated on the blog calculated per case or per hour for $$$.$$

2)  Google and other search engine rankings at $$$.$$.  This blog consistently comes up in position one in Google for the subject matter and we all know position one in Google is priceless.

Here is another way to think of it.

If a law firm had to prepare for a trial and

1)  Write a 400 page brief.

2)  Then meet with 287,833 clients for 1.09 minutes; (some of them twice which factors in for unique visitors).

3)  How much would the firm charge for this??

Answer:  287,833 x 1.09 = 313,737 minutes / 60 minutes in an hour = 5,228 hours at $200, $250, $300, $350 per hour + 800 hours to create blog.

Message to all frustrated writers that became attorneys:  Keep track of all figures that were put into the blog you “volunteered” to create for your firm.  In the future you may never know if you will need to substantiate the value of your “hobby” within your firm.

Like waves on the sea

Buying cycle frequencies

Don’t sail at low tide

So, without further ado, here is our first haiku:

Recommendations

Without implementation

Are trees without soil

Understanding the sensitivity between price and demand is critical to all marketers.  We want to find the smallest change in price (ie, smallest discount) that leads to the biggest change in quantity demanded, resulting in the optimal increase in sales.   In addition to doing an A/B split test to see if one discount works better than another, it is important to measure the actual sensitivity.   If the price sensitivity is known, then more effective online promotional campaigns can be designed to get the desired sales result.

In math and economics measuring this sensitivity is called the price elasticity of demand, which is characterized by the symbol “η”.  And there is a reasonably simple formula for calculating that.

η = price elasticity of demand

η = - (% change in orders) / (% change in price)

η = - [Δ Q / (Q₁ + Q₂) /2] ÷ [Δ P / (P₁ + P₂) /2]

If η is > 1, then you have elastic demand, and a change in price can make a big difference in demand, and total sales made.  But if η is < 1, than you have inelastic demand, and a change in price is not going to affect demand.   You’ll just sell the same quantity but make less revenue because you gave a discount.

Let’s take an example of an online apparel retailer.  They sell a wide variety of women’s clothing.  They want to promote their spring trench coats and their new line of polo shirts.  Demand is lagging and they are contemplating doing a sales promotion to sell their spring inventory.  They would like to test different discounts with their email list first to determine how effective the discount would be on their website and in their search campaigns.  They run the following A/B split tests in their weekly email campaign and get these results:

Spring Trench Coats
Discount	Price	Quantity Sold	Total Sales
Regular Retail	$ 150.00	20	$3,000.00
With 17% discount	$ 125.00	36	$4,500.00

Plugging in the numbers to the formula for price elasticity we get:

η = - [(20-36) / (20+36)/2] ÷ [($150-$125) / ($150 + $125) /2]

η =  3.14

Every 1 % discount represents 3.14% in increased orders.

Basic Polo Shirt
Discount	Price	Quantity Sold	Total Sales
Regular Retail	$   25.00	45	$1,125.00
With 20% discount	$   20.00	48	$   960.00

Plugging in the numbers to the formula for price elasticity we get:

η = - [(45-48) / (45+48)/2] ÷ [($25-$20) / ($25 + $20) /2]

η =  .29

Every 1 % discount represents .29 % in increased orders.

While they could just look at the sales results and see that the spring trench coat sale of $25 off (or a 17%) discount was effective, by measuring the price elasticity of demand for the trench coats they had better statistical data to support publishing the sale through search and on their website.  Trench coats had a very elastic demand and it was worth adding the $25 off promotion to the website and to the search campaigns.

The basic polo shirt sold more orders but was it effective?  By measuring the price elasticity it became very clear that the polo shirts had an inelastic demand.  They actually made less revenue.  It was now clear that it was not going to be effective to run a discount promotion on the website or in the search campaigns for the polo shirts.  It actually would hurt total revenue.

Next week we’ll use a bit more math to help you calculate what a statistically valid sample size with an acceptable sampling error should be.  This will help you determine how large of a marketing test do you have to conduct before you can have a high degree of confidence that full campaign will get you the results you are forecasting.

Sharing how to use math in marketing, Cindy.