Your Website is Speaking to You – Are You Listening?

Do you know who your website visitors are? How they found your website? How long they stay? Which pages they read or land on and exit without reading? This kind of information can provide valuable insights into the effectiveness of your website, individual web pages, online and offline marketing campaigns, keyword search terms, and the techniques you use to drive traffic to the site.

Many website owners look at the number of hits and believe that their site is attracting much more traffic than it actually generates. A hit merely indicates the number of files sent to a user when the user lands on the page. So, a single visit to a page which contains ten separate graphic files will show up as ten hits. However, tracking hits over a period of time may indicate whether your website is attracting an increasing or decreasing number of visitors.

Here are some other statistics that can assist in determining the strength and weaknesses of your website and the changes required to attain your company’s marketing and sales objectives.

You can obtain a breakdown of the total visitors to your site by unique visitors and returning visitors. An effective search engine marketing program will enable qualified new visitors (those potentially interested in purchasing your goods or services) to find your site, provide reasons for repeat visitors to come back to your site, and encourage all visitors to advance in the sales cycle (i.e, make a purchase, request additional information, fill out a registration form, etc.).

By examining your visitors’ paths through your site, you can find out the number of pages viewed, the order in which they were viewed, the time spent on each page, any actions taken on particular page (such as clicks on specific links), and the entrance and exit pages. If you examine the data carefully, you might find that patterns emerge, such as a specific landing page that attracts most visitors. Where are you losing your visitors? How sticky is each page? (Stickiness refers to the amount of time that visitors spend on your web page). How many visitors landed on a particular page and then exited immediately? How many visitors exited from the same page? All of these statistics are highly relevant in evaluating the usefulness of your website in your marketing and sales mix.

Another important issue is where your traffic originates. Web analytic software indicates whether your visitor came from a company or an Internet Service Provider such as ATT or Comcast. It can also indicate whether your traffic came from a search engine, which specific search engine, the terms that the visitor used, and where you appear in the results for that search. Sometimes you’ll find some peculiar results. For example, in one search that I found, the number one result for the search for Rob Jones was Rob Smith of Jones & Co.). Although I changed Rob’s last name and the name of the company, you can see how search engines can sometimes return unexpected results, and it’s good to know about these potential deviations when developing your keywords.

Free basic statistics are available from a variety of sources including your web hosting company, Google analytics (www.google.com/analytics), StatCounter (http://www.statcounter.com/), and Gostats (http://www.gostats.com/). Companies such as WebTrends (http://www.webtrends.com/), Index Tools (http://www.indextools.com/) and OneStat (http://www.onestat.com/) sell more robust software that can provide in-depth information. I suggest that you take advantage of trial offers and compare several software applications before you purchase.

While this article includes only a brief overview of the information available from your web analytic statistics, the following books provide more complete pictures of how you can best monitor your website usage.

Actionable Web Analytics: Using Data to Make Smart Business Decisions

Web Analytics For Dummies (For Dummies (Computers))

Competing on Analytics: The New Science of Winning

Some Frequently Overlooked Deductions That Make Tax Time Less Taxing

It’s that time of year again when businesses and individuals are organizing their expenses for tax deductions. While there are a myriad of potential deductions, following are a few of the most frequently overlooked.

Business Deductions

New equipment. Section 179 of the Internal Revenue Code allows businesses to deduct in one year, rather than capitalizing them over several years, the total cost of new equipment up to a maximum of $125,000. However, this deduction is subject to being phased out if a business places over $500,000 of new equipment in service during that year. Assets that do not qualify for a Section 179 deduction include real estate, property purchased from a close relative, and inventory purchased for the purpose of resale.

Software. Although computer software generally must be depreciated over 36 months, there are two notable exceptions. If software is placed in service between January 1, 2003 and December 31, 2010, it is eligible for a 100% deduction in one year under Section 179. For software included as part of a newly purchased computer system that cost no more than $125,000 in 2007, the entire cost can be deducted in one year under Section 179. For further clarification, see IRS Publication 946, How to Depreciate Property.

Insurance. The necessary and ordinary cost of insurance for your business, trade, or profession is usually deductible.

Repairs and maintenance. The costs of repairing or maintaining business equipment, buildings, and office space are deductible as business expenses.

Startup costs. Up to $5,000 in startup costs for a new business can be deducted in the year that the business is established.

Disabled access credit. Small businesses with revenues of $1 million or under and fewer than 30 full-time employees may be eligible to deduct expenditures to remove barriers to accessibility by disabled individuals (in buildings constructed before 1990) and to acquire or modify equipment or devices for individuals with disabilities. The maximum credit in 2007 is $5,000 (See instructions on IRS form 8826 which can be found at www.irs.gov).

Deductions for Individuals

Education. Generally, the cost of education necessary to maintain or improve your job skills is a deductible expense.

Job-related expenses. Certain unreimbursed job-related expenses, such as travel, uniforms, and union dues, are deductible.

Medical expenses. If your medical expenses amount to more than 7.5% of your income, the following costs may be deductible: medical transportation expenses, eyeglasses, hearing aids, equipment for disable or handicapped persons, salaries paid to nursing personnel, and the cost of alcohol and drug abuse programs.

Long-term care insurance premiums. The amount of qualified long-term care premiums that can be included as medical expenses ranges from $290 to $3,860 depending on the age of the insured.

Any tax information contained in this article should be reviewed with a tax professional before taking any of the deductions or credits discussed.

Loyalty Programs: Do They Create Customer Loyalty or Program Loyalty?

As I was having my hair styled last week, I realized that I was the epitome of a loyal customer. I have followed Lynn to three different salons within the past year without incentives such as coupons, frequent customer cards, or discounts after so many visits. Moreover, I have recommended her to several of my friends.

If I had been merely a satisfied customer, I might have found someone else at the original salon which was offering discounts to retain its clientele. When you think about it, how many satisfied customers has your business lost lately?

Many companies conduct satisfaction surveys, believing that satisfied customers will also be loyal customers. However, in a 1995 Harvard Business Review article, “Why Satisfied Customers Defect,” T.O Jones and W. E. Sasser, Jr. found high rates of defection among customers who were merely satisfied while only those customers who were identified as highly satisfied were likely to purchase again.

According to a businessweek.com article by Fred Reichheld and Rob Markey(NPS: The Next Six Sigma?, September 22, 2006), customer loyalty can be gauged by responses to the question: "How likely is it that you would recommend this company to a friend or colleague?" Those customers who were most likely to recommend a company “bought more goods and services, bought them more often, gave the company a greater share of their wallet, and were more likely to talk up the company to others.”

If you are typical, you probably belong to several loyalty programs, but your loyalty may be attached more to the program rewards than to the company providing them. Here are some measures which have been identified to promote the consumer behaviors that are valued by companies:

- Engaged and empowered employees who provide high levels of service
- Customer feedback that enables companies to understand and reward their best
customers
- Products or services that are perceived as high quality and tailored to
customers’ needs
- Rewards that are desirable, attainable within a reasonable amount of time,
and renewable

There’s also a downside to loyalty programs. As a University of Florida study (Steven Shugan, 2007) points out, when businesses promise future giveaways, they trade immediate cash benefits for future liabilities. In addition, some programs may reward new customers more than existing ones through various enrollment incentives or special offers.

Developing customer loyalty requires a lot of motivation, focus, and work.

Who Moved My Cheese (Again)?

At a recent networking event, a friend was discussing how the nature of her work has changed. As a software and human resources trainer, she has observed and participated in several workplace evolutions and revolutions.

When I first worked on a computer, I learned WordPerfect and Lotus 1-2-3 for dos and struggled to master Harvard Graphics without a users’ manual because the printed copy could not be located. There was no Internet connection at work, nor did I have email. The introduction of Windows revolutionized the way that I worked then and now. And the increasing influence of the Internet and mobile connectivity means that I must always learn new ways of doing business.

In other words, if I were one of the characters in the book, Who Moved My Cheese? An Amazing Way to Deal with Change in Your Work and in Your Life by Spencer Johnson, my cheese would be a continually moving target. A seemingly simple fable about mice and “Littlepeople” (aptly named Sniff, Scurry, Hem and Haw), this book makes many readers think carefully about their own coping mechanisms and the ways in which they adapt to (inevitable) changes in their lives.

For me, the value of this book lies in its implied challenge — to incorporate its message into my own situation and respond appropriately to what can become positive changes rather than to oppose all deviations from the existing “norm” without thought. I have to admit that I don’t embrace all change equally and without any resistance. But after reading this book, I consider carefully the broader impact of change rather than just its effects on my particular circumstances.

There is an abundance of extremely valuable classic business and management books, including the following: The One Minute Manager, The 7 Habits of Highly Effective People , and Good to Great: Why Some Companies Make the Leap... and Others Don't. However, Who Moved My Cheese? is my favorite because it has remained the most relevant to me since I first read it a decade ago.

What is your favorite business or management book? I plan to use the selected entries in a future blog, so email me at nwolpin@hotmail.com with the name and author of the book along with one or two sentences explaining why you found it influential. Include your name and any contact information that you would like to see mentioned in the blog. I’m looking forward to your response.

Measuring the Success of Your Email Campaigns

Only 57% of marketers measure email campaign results within 24-48 hours after the email is sent and only18% measure email results on an annual basis according to a report by Email Stat Center (http://www.emailstatcenter.com/). The survey found that deliverability and clickthrough rates were considered to be the most important metrics when evaluating results.

I find these statistics surprising. One of the major advantages of email marketing is the rapid feedback, so I monitor these metrics carefully to determine which email campaigns are successful and which need improvement. Here are definitions of some of the metrics that I consider to be important.

Deliverability is the percentage of emails that Internet Service Providers allow to be placed into one of the addressee’s boxes. Some larger email service providers boast deliverability rates of 96% - 99%. It does not, however, necessarily indicate the percentage of emails that reached inboxes rather than the junk mail or spam boxes.

Hard bounce means that the email could not be delivered for a reason such as a nonexistent email address in which case sending it again will not remedy the situation.

Soft bounce is created by a temporary situation, such as a full inbox or a problem with the recipient’s email server.

Open rates refer to the percentage of emails that recipients click on and actually open. Open rates are obtained by obtained by dividing the number of emails opened by the number of emails sent and multiplying the result by 100. .

Clickthrough rates refer to the percentage of links clicked on by recipients. The clickthrough rate is obtained by dividing the number of clicks by the number of emails opened and multiplying the result by 100. Unique clickthroughs are the percentage of clickthroughs from different recipients. Total clickthrough rates reflect the percentage of clickthroughs from both unique and returning recipients.

Conversion rates are considered by many to be one of the most significant measures of success. The conversion rate is calculated by dividing the number of email recipients who actually clicked through to a website and took the desired action (purchased something, competed a registration form, provided information or whatever purpose the email was supposed to serve) divided by the total number of people who received the email multiplied by 100.

However, the Email Experience Council (http://www.emailexperience.org/) found that it is impossible to establish industry standards because of the lack of consistency in the calculation of these and other key performance metrics (March 2007).

Web 2.0: You and Me and an International Village

Like many of you, I have evolved from a passive web user to an active participant in web communities. I network on linkedin, check products on ebay, comment on photos on Flickr, view videos on YouTube, search MySpace and Facebook, create tags for technorati, read the South Florida Public Relations Network message board, and encourage emailed comments on my blog.

With Web 2.0, the Internet has evolved from a static collection of websites that were basically a library-like repository of information and a showcase for public, private, and municipal organizations into a collection of communities where users are encouraged to participate and join. Wikipedia, an online encyclopedia which allows almost anyone to post or edit articles, defines Web 2.0 as follows:

“Web 2.0 refers to a perceived second generation of web-based communities and hosted services — such as social-networking sites, wikis, and folksonomies — which aim to facilitate creativity…, collaboration, and sharing between users. The term gained currency following the first O'Reilly Media Web 2.0 conference in 2004… Although the term suggests a new version of the World Wide Web, it does not refer to an update to any technical specifications, but to changes in the ways software developers and end-users use webs.”

Folksonomies are tags or methods of organizing and bookmarking information into meaningful categories that add value and enable groups to easily find relevant documents, graphics, photos, products, or data. Because of the proliferation of information sharing on the web, folksonomies on sites such as technorati, delic.io.us, and flickr have become increasingly popular.

Web 2.0 websites share certain characteristics. They:

• Are interactive and dynamic with user-friendly interfaces
• Enable users to interact with each other as individuals, communities,
networks, or friends
• Allow users to access web-based applications through a variety of web
browsers
• Have long tails that enable narrow niches to reach out through the entire web
• Encourage user participation because users add value
• Facilitate cooperation rather than control

I recently attended a presentation sponsored by IBM that illustrated the use of social software in a corporate community. The employee directory features employee photographs, locations, contact information, job descriptions, interests, and pertinent information that the employee wishes to disclose. Employees in far-flung locations can work together in groups by uploading and sharing information or can join non work-related special interest online communities.

There is no doubt that Web 2.0 has changed the way that we live, work, shop, entertain ourselves, obtain information, and acquire new friends. And the power of Web 2.0 is that it enables all of us to leave our footprints on the Internet.

Email Marketing: The Numbers Behind the Buzz

Despite the ascent of Web 2.0, IMs, and text messaging, email marketing is still growing in importance in the marketing mix. And according to Datran Media Research (“The 2007 Email Marketing Survey”), 83% of the marketers who responded thought that email ROI will increase over last year. Statistics collected from a variety of additional sources indicate that email marketing still has a bright future.

The Direct Marketing Association’s 2006 Response Rate Trends Report finds that the highest direct marketing response rates result from telemarketing (2.6%) and email (2.45%). Email’s ROI index is 70% higher than any other method of direct-response marketing. The organization also estimates that marketers in the United States alone will spend $500 million on email marketing which is expected to generate almost $22 billion in sales.

Following are some statistics cited by Internet Retailer (2007) as a result of its monthly surveys:

- 18.7% of internet retailers indicated that email generates 1% to 2.5% of sales
- 37.4% of online merchants find that email generates between 2.51% and 15%
of revenues
- For 11% of online merchants, email drives more than 25% of total sales
- Nearly three-quarters (73%) of chain retailers, catalogers, virtual merchants, and consumer brand manufacturers report spending only 5% or less of their total marketing budgets on email marketing

Compared to other forms of online marketing, email delivers sales at an average cost per order of less than $7, compared to $71.89 for banner ads, $26.75 for paid search and $17.47 for affiliate programs. - Shop.org, State of Retailing Online 2007 report (Sept. 2007);

For additional email marketing statistics, you can visit the following websites:

http://www.emailstatcenter.com/
http://www.internetretailer.com/
http://www.the-dma.org/
http://www.mediapost.com/