Categories
Marketing

SparkToro review: finding influencers made easy

SparkToro is a new tool launched by Rand Fishkin and Casey Henry. I was able to get my hands on a press version pre-launch. This post is based on the pre-launch version.

Problem to be solved

Let’s say you’re launching a new product designed for avid knitters.

If you take the traditional digital marketing playbook, you’ll probably choose one or more of the following options:

  • Run Google AdWords ads with keywords related to knitting.
  • Run Facebook ads and try to use Facebook’s tools to target knitters.
  • Upload your customer list of current knitting customers and use Google’s and Facebook’s tools to target them and automatically generated twin audiences.
  • Since you know the knitting scene, you might place some ads on Ravelry, given that’s such a popular site for knitters and they have their own ad tools available.

This is where SparkToro aims to provide another option.

You can use the tool to find out:

  • Which accounts on social media knitters follow
  • Which websites knitters frequent
  • Which podcasts knitters listen to
  • Which YouTube channels knitters follow
  • Get insights about knitters as an audience

With this information on hand, you can appear as a guest on the right podcasts, get the right bloggers to review your product and sponsor the right YouTube channels in order to reach your target audience.

Sounds good, right? Let’s see if the tool can deliver.

Taking SparkToro for a test ride

I used SparkToro to test seven different cases:

  1. I wanted to know where I can reach people who talk about product management.
  2. I wanted to see if there was a difference in people talking about product management vs product launches.
  3. I wanted to know where I can reach people who talk about knitting.
  4. I wanted to know which type of people read the site IwillTeachYouToBeRich.com.
  5. I wanted to know where I can reach parents of twins.
  6. I wanted to understand the difference between people who characterise themselves as founders vs entrepreneurs.
  7. I wanted to know what type of people talk about sketchnotes.

Let’s look at how to do this with SparkToro.

Using SparkToro

There are three ways to use SparkToro:

  1. Audience Intelligence, where you search for information about your audience (more on that soon).
  2. Compare Audiences, where you see differences between two different audiences (same search operators as in 1).
  3. Profile search, where you can find information about audiences that interact with a specific website or social profile.

I’ll walk you through these functions one by one and then look at what I learned from the different test cases.

Audience Intelligence

I started by testing the Audience Intelligence functionality. I used it for use cases 1, 3, 5 and 7.

You can search for audiences base on:

  • what they talk about
  • which words they use in their profiles
  • which social account they follow
  • which websites they visit and which hashtags they use

I couldn’t find a use for the hashtag function, but the rest made sense for me and my test cases.

The results page shows a summary of:

  • how large the audience is
  • how similar or diverse it is
  • how much confidence SparkToro has in the results

The results page also show summaries of findings about:

  • social
  • websites
  • podcasts
  • YouTube
  • audience insights

You can expand and explore each of these sections.

When you expand a section, like Social above, you see all the results and you can filter the results, export the results as a csv or add them to a list in SparkToro.

When you export something, the resulting file has a meaningful name. This is a very nice little usability touch, especially for heavy users working in bulk.

Compare Audiences

The audience comparison functionality let’s you compare two different audiences. I used this for use cases 2 and 6.

You can use the same search functions as in Audience Intelligence to compare audiences.

You could compare audiences that talk about product launches with audiences that talk about product management (like I did above).

But you could just as well compare audiences who have “VP Marketing” in their bios with audiences that talk about product launches.

The results show you comparison along the familiar data axis:

  • Behavior similarity
  • Audience size
  • Audience confidence
  • Social accounts
  • Phrases in bio
  • Podcasts
  • Websites
  • Geographies
  • Hashtags

Profile search

Profile search lets you start with a website or social profile and see what the audience for that is. I used this for use case 4.

I tested this functionality by looking at the audience of the personal finance site www.iwillteachyoutoberich.com.

Unsuprisingly, the top social profile followed was that of the founder, Ramit Sethi.

Summarizing results and verdict overall

I showed you earlier the seven cases I used for testing. They were the following:

  1. I wanted to know where I can reach people who talk about product management.
  2. I wanted to see if there was a difference in people talking about product management and product launches.
  3. I wanted to know where I can reach people who talk about knitting.
  4. I wanted to know which type of people read the site IwillTeachYouToBeRich.com.
  5. I wanted to know where I can reach parents of twins.
  6. I wanted to understand the difference between people who characterise themselves as founders vs entrepreneurs.
  7. I wanted to know what type of people talk about sketchnotes.

Let’s look at them in turn.

  1. I found helpful results to where I could reach people talking about product management.
  2. I found results for the differences between people talking about product management and product launches, but since the audiences where quite similar, the results weren’t that meaningful.
  3. I found where I can find people talking about knitting. Unsurprisingly, Ravelry was at the top of the list. I did, however, find it surprising that the Philosophize This podcast was highly popular among knitters!
  4. I found helpful results when analysing the audience of IWillTeachYouToBeRich.com.
  5. I completely failed when trying to find where to reach parents of twins. The tool offered me results about the Minnesota Twins, the Twin Cities and the Dolan Twins. But nothing related to twin children.
  6. I found helpful and meaningful results when comparing people who describe themselves as founders vs entrepreneurs. The difference was bigger than I expected.
  7. I found helpful and meaningful results when searching for information about people interested in sketchnotes. Spoiler: they mostly seem to be teachers and students.

My overall finding is that SparkToro is a well designed and well built tool. Even if I was testing the pre-launch version, I didn’t encounter any bugs or anomalies.

There are, however, challenges.

The example about twins shows that context is hard. Google has put on a lot of work to provide the right context in search and made advances.

SparkToro still needs to figure this out.

I also tried to use the tools in Finnish and Swedish. The results where poor. To be fair, that’s what I was told to expect.

Conclusion: the product does what it promises and seems more mature than it is. Contextual ambiguities and major issues with other languages than English should be expected.

Categories
Marketing

The Copy Machine Experiment gives advice for getting your requests granted

We all ask for favors. We all make requests. Some are big and significant, some are small and mundane.

Nevertheless, we hope these favors and requests are granted.

If you’re in sales or marketing, your livelihood depends on getting a ‘yes’. So pay attention.

In order to maximize our chances, we should take advice from social scientists about how to get our requests granted.

The Copy Machine Experiment

Sketchnote summary of the 1977 Copy Machine experiment by Ellen Langer et al.
Sketchnote summary of the Copy Machine Experiment and most interesting results.

In 1977, Ellen Langer, Arthur Blank and Benzion Chanowitz arranged for an experiment at the Graduate Center City University of New York.

They wanted to study how people respond to requests.

In the experiment, the experimenter asked to cut in line at a copy machine.

(Note: this was a loooong time ago, so people studied in libraries and made paper copies of things they wanted to keep.)

The experimenter had three kinds of requests:

  1. Just ask to cut in line with no specific reason.
  2. Ask to cut in line and give a non-reason, like “because I need to make copies”.
  3. Ask to cut in line and give a valid reason, like “because I’m in a hurry and I need to make copies”.

The had some other variables to test as well:

  • Small request vs big request. This was measured in amount of pages to copy. They tested with 5 pages and 20 pages and classified requests as big if the experimenter had more pages than the subject and small if the experimenter had less pages to copy.
  • Man vs woman. They had two different experimenters make the requests.

Results from the experiment

The results where surprising.

  • 60% of the subjects given no reason said yes.
  • 93% of the subjects given a non-reason said yes.
  • 94% of the subjects given a valid reason said yes.

These are staggering numbers! Almost equally many granted the experimenters request given any reason, valid or not.

This means we should always couple our asks with a reason for why we’re asking. The reason can be almost anything.

Important caveat

But… There’s a big but.

This part of the results is often neglected when the experiment is presented.

This result is only valid for small requests. When we look at the numbers for big requests, the results change significantly.

  • 24% of the subjects given no reason said yes.
  • 24% of the subjects given a non-reason said yes.
  • 42% of the subjects given a valid reason said yes.

The conclusion is that for larger requests reasons still work, but the reasons need to be valid.

It’s also worthwhile noting that the female experimenter got more requests granted than the male experimenter.

References and links

References: the paper published, the full text.

Categories
Marketing

SEO4LIFE sketchnotes

I attended the SEO4LIFE live stream today and made some sketchnotes.

I had to step out for an hour, so not all the talks are sketched, but the ones that were, are available for your enjoyment below.

You can also download a pdf including all the notes.

Aleyda Solis

Aleyda Solis on migrations

Hamlet Batista

Purna Virji

Kevin Indig

Kevin Indig on search engine to answer engine

Cindy Krum

Cindy Krum on fraggles

Jono Alderson

While the other sketches are quite traditional notes, during Jono’s presentation, I did a lot of reflections while he talked. So this note is a mix of Jono’s presentation and my reflections on what he was talking about.

Jono Alderson on changes in Googles approach
Categories
Marketing

How to sell in a recession: 10 tips from experts

Amidst the coronavirus turmoil, it seems inevitable that we’re about to enter a global recession. Stocks have already taken a huge hit, but the real economy is just starting to see the effects.

This means now is a perfect time to start reading up on how to sell in a recession.

How to sell in a recession in retail

During the financial crisis, management consultants Ken Favro, Tim Romberger and David Meer published a piece in the Harvard Business Review about selling in a downmarket.

They use Starbucks as an example of companies hit hard, which feels a bit off in retrospect, given what a massive success it became in the following decade.

This choice of case strengthens two key points to remember:

  1. Starbucks did many things right during the financial crisis
  2. There are opportunities to dramatically improve your business during a downturn

Let’s explore what learnings the management consultants derived from Starbucks and other retail companies they studied.

1. Go where there is market to gain and avoid excessive action

First and foremost, rushing to action has a low likelihood for success. Managers typically feel the need for broad and immediate action, but focus yields better results.

Retailers should focus on where they can grow market share, which the authors call headroom.

We define “headroom” as market share you don’t have minus market share you won’t get.

Favro, Romberger and Meer

For retail, the headroom often lies with non-loyal customers.

When times are good, loyal customers are often the most profitable and the easiest to grow. But when spending goes down across the board, it goes down also with loyal customers.

Non-loyal customers, on the other hand, are spending only part of their money at any given retailer. So even if their spending goes down, you can grow by capturing a larger part of their total spend.

2. Understand what the non-loyalists want and give it to them

Gradual optimisation will not help you capture growth from the non-loyal customers. They are not loyal for a reason and you need to understand what the reason is.

The authors give the following example about Starbucks.

Many coffee drinkers want a self-serve food experience much like that offered by such outlets as Pret A Manger. Coffee connoisseurs want the espressos, cappuccinos, and experience that can be found in Italy’s best coffee bars. And many just want their original Starbucks back—the socially responsible “third place” between the office and home.

Favro, Romberger and Meer

The gap between what the switchers want and what you offer can also be found in product categories, such as in the example below.

However, this retailer’s headroom in apparel was disproportionate to the sales it was realizing. Even its most frequent shoppers were going elsewhere to purchase their clothing.

Favro, Romberger and Meer

These gaps are, of course, difficult to capture in data, since data mainly shows you what has and hasn’t worked historically.

You need to combine historical data with inputs on possible growth segments (i.e. headroom) in order to identify which categories could serve those segments.

3. Take out bad costs

Every business has both good costs and bad costs.

Good costs are the ones which drive things customers are willing to pay for. Depending on your business, this might be convenience, speed or assortment.

Bad costs don’t add anything to the business that customers are willing to pay for. Every business has bad costs. During a recession, these need to go.

Another example by the authors on Starbucks below.

Starbucks’s bad costs might involve too much seating in stores used primarily by take-out customers, or unnecessarily extended hours in certain local markets, or too much inventory and space dedicated to accessories (those coffeepots, movies, and whatnot) that few customers purchase.

Favro, Romberger and Meer

The need to cut bad costs isn’t specific to retail. In my experience, all businesses need to go after bad costs relentlessly. It’s a grateful job, since margins go up and the negative consequences are minimal, usually limited to some individuals getting upset.

During good times, companies just tend to focus much more on growth and much less on cost, so the bad costs keep creeping up, a little bit at a time.

Recessions force most to cut out this fat and improve the health of the business.

4. Cluster stores and not just customers

All retail locations are different, but many of them share traits. By understanding which, and clustering together similar stores, decision making and optimising become easier.

In theory, stores could be clustered just by clustering customers and then comparing customer profiles, but this is often impractical if only for the reason, that many customers don’t fit neatly into given customer profiles.

The store clusters can be used to figure out which type of “headroom” exist for which cluster.

5. Adjust research and KPIs

During a recession, retailer’s research should focus on finding headroom and understanding what these new customers want and how to give it to them.

One supermarket chain we know of, for instance, routinely asks patrons, “Did you find what you need?” at checkout. But when the answer is “no,” the next question clerks ask is, “Did you ask for help in finding it?”

Favro, Romberger and Meer

The same goes for KPIs and performance management. The normal measures won’t help you understanding if you’re nailing headroom and closing the gap.

How to sell in a recession in B2B sales

B2B sales has a very different dynamic than consumer facing retail and hence the toolbox for B2B sales reps and managers will differ significantly from that of retail. Let’s dive into what previous downturns have taught us about this craft.

1. Risk-aversion does up, which means you should focus more

In the wake of the financial crisis, CBS news interviewed sales recruitment and sales training experts to figure out how to win in a downmarket. The key finding evolves around risk.

During bad times, people become more risk-averse. This means potential problems matter more than potential upside. If someone is scared for their livelihood, they will do whatever it takes to avoid bad decisions.

Adjust your story and focus accordingly.

Focus on risk slows down decisions. This means each prospect or lead needs more contact points to close a sale than during good times. In sales, you should focus more time on fewer leads, even if the default tendency would be to hedge bets by working as many leads as possible.

2. Change your attitude

Sales consultant Liz Wendling writes about attitudes.

When the going gets rough, we need to up our game to make it. In sales, the good news is that every sales rep can affect their outcomes, even when circumstances are bad.

In order to do this, you need to focus on your work instead of your circumstances. Up your activities and commit to getting deals.

3. Challenger sales methodology was created to sell in a downturn

The challenger selling method was created when the consultants behind it noticed, that some reps were able to keep hitting their quota while the majority underperformed during a recession.

So they dug into it and identified five different seller profiles:

  1. Hard worker
  2. Lone wolf
  3. Problem solver
  4. Relationship builder
  5. Challenger

The conclusion was that the challenger was the most likely to keep getting results in tough environments.

The challenger model builds on three fundamental parts from an individual sales reps point of view:

  1. Teaching
  2. Taking control
  3. Tailoring

Let’s take a look at each in turn.

Teach for differentiation

Key concepts for teaching are insights and reframing. What the challenger seller does, is to teach the customer something about their own business that they didn’t previously know.

One way of doing this is by reframing the customer’s problem or their proposed solution, or how they view their entire business.

Take control

The challenger will have control over the dialogue, push customer to action and resist any requests for discounts, expensive tailoring of the solution or other bad terms and conditions.

Pushing the customer to move is especially powerful in a downward market, since customers are more risk aware than normal.

Tailor for resonance

Tailoring doesn’t mean the solutions you sell need to be tailored. It means the messaging needs to be tailored and the customer needs to feel like they are getting something that’s as good a fit for them as if it was tailored.

In order to increase sense of tailoring, use the same reframing techniques as when teaching.

More information about challenger selling and rolling it out can be found in e.g. this Gartner summary and this Pipedrive summary.

Conclusions about how to sell in a recession

Selling and succeeding in a downward market is possible, but requires different tools and methods compared to selling and succeeding in a normal or growing market.

How to sell in a recession is different.

Because downward markets stir everything around, it can give a good opportunity to reposition your company for growth down the line. Like for Starbucks during the financial crisis.

There’s always business available somewhere, it’s just harder to find now.

Categories
Marketing

Income generating websites as investments

I’ve been looking into websites as an asset class from an investment point of view lately. Given I’ve dabbled around with public companies, private companies, real estate and consumer loans previously, I wanted to make some notes on what I’ve learned about websites as an asset class until now.

In this post, I’ll start with saying a few words about different asset classes to set the scene and give some frame of reference. Then I’ll dive into websites as an asset class, their risks, opportunities and so forth.

Overview of investment types

Bear with me for some background, I’ll dive into the specifics about websites in a minute.

One of the best investment advise I’ve heard is to only invest in assets you understand.

If we’re talking about companies, this means you should understand that company’s business. Because when you do, you understand what makes a company strong or weak and thus better grasp the threats and opportunities it’s facing.

At the end of the day, the better you understand what you’re investing in, the better you can pick your investments and the better you understand the risks.

I’d venture a guess that publicly traded companies and mutual funds that are investing in publicly traded companies, are the most common investment people have.

If we’d count people’s own homes as investments, this would come in as number one. But I won’t, since it’s not a pure investment. Given this limitation, I’d imagine real estate coming in as number two, measured in popularity.

(Site note: Robert Kiyosaki of Rich Dad, Poor Dad fame writes about owned homes being liabilities since they cost money. I’m not that strict since (a) a home can appreciate in value giving its owner a return and (b) in many cases owning is less expensive than renting, thus giving its owner a quantifiable saving which can be paralleled to an investment generating cash flow used to pay rent.)

Both public companies and real estate are well understood and mainstream investment vehicles for both big and small investors. There are huge amounts of money, people and focus in both asset classes and thus markets are generally pretty efficient.

This means it’s difficult to find investment objects that are priced really, really wrong, if you do even a little bit of background research and comparison.

Because of efficient markets and because of regulators forcing availability of information, we can invest in both public companies and real estate without really understanding those investments without huge risks.

(Side note: I don’t recommend investing in anything you don’t think you understand very well. Just saying…)

The same does not hold for other types of investments, such as the asset class known as SWAG. SWAG is short for silver, wine, arts and gold.

I can imagine a thousand ways for how things can go wrong if I’d try to pick pieces of art to buy as investments. I’d give it a 90% chance of failure, since I wouldn’t be able to just pick up a Picasso and hope things work out 10 years from now.

From my point of view, investing in websites is much more like investing in art than investing in the S&P500 stock index. It requires expertise and things can go horribly wrong really quick, unless you know what you’re doing.

Taking this train of thought further, the best parallel I can draw is to acquiring a small or medium sized business. This type of investment comes with huge risks compared to public companies, are much less liquid and usually require a at least moderate involvement by the owner. Actually, most small and even medium businesses are build around the assumption of major owner involvement whereas public companies are designed around absolutely no owner involvement whatsoever.

Websites as investments and my background in this game

Since websites require expertise as investment objects, I’ll just call them a “concierge asset” like small businesses or art. Something that you should only buy if you have the proper knowledge to grasp the risks.

As for myself and my background in this field, I’ve been working with digital marketing and digital services since the late 1990s. So even if I’m not the best at everything, I’d imagine qualifying as a “concierge” of developing and growing websites in general.

I’m not an expert in SEO, but I know the basics. I’m not an expert copywriter, but I’ve written all sorts of content including books. I’m not a developer, but I have handcrafted both websites and apps, coding line-by-line. You get the gist of it.

I’ve built hundreds of websites over the years. I’ve subcontracted work, I’ve build things myself and I’ve even bought one ready-made, income-generating site. Still, I feel there are a lot of things to learn about the affiliate marketing kind of sites.

I’m currently somehow involved in running the following Finnish sites:

  • Kuono.fi, a site for dog owners. The site was purchased in 2017 and I run it together with a business partner. Income is based in advertising and content marketing partnerships.
  • Talousviisas.fi, a site about personal finance. The site was built together with a business partner in 2018 and has not been monetized yet. It generates about 1/10 of the traffic compared to Kuono.
  • Parasblenderi.fi, a product review site for blenders. The site was built by me in 2016 to test if I can still get a site to rank properly in Google. It generates very moderate affiliate income.
  • Verokuitti, a site to exemplify how tax money is spent. It’s neither maintained nor monetised, but won our project team some awards.
  • Kotisivubisnes.com is also worth mentioning, even though it doesn’t exist anymore. It was a content site around building website creation. It generated affiliate income, but given a competitor to my employer acquired the main affiliate partner, I didn’t feel comfortable getting income from them anymore and so I closed down the site.

After buying Kuono in 2017, I’ve been looking for other sites to buy. It seems like most Finnish sites are either minuscule or already properly monetized and sold to bigger media companies.

Since not finding proper sites to buy in Finland, I’ve started looking abroad.

The most commonly sold type of website from an investment perspective is one that’s doing affiliate marketing and generating income through referral based sales. There are some sites monetised through ads and lead gen out there as well, though.

This type of affiliate marketing website is a species on its own.

There are several marketplaces like Flippa, Empire Flippers and Investors Club that post sites for sale. These sites publish content in English and usually make a majority of their income thought the Amazon associates affiliate program.

Most sites seem to be priced around 30 x monthly profit, although prices commonly vary from 25-35x.

It seems like small, <$10k sites get sold in days. Once pass the $30k threshold, demand drops and >$100k sites seem to have much less buyers already.

If you want to start small, you’ll have to accept more risk, since the few day turnaround time doesn’t allow for proper due diligence.

Even if you do proper due diligence, there are still many inherent risks to these type of sites, like:

  • The traffic is usually based on Google searches. If Google changes their algorithm, you might lose tons of business.
  • Many sites make money on the Amazon affiliate program. Amazon has previously decreased the commissions they pay their affiliates and if this happens, you can lose tons of business.
  • Previous owners might have used black hat SEO tactics that haven’t yet been discovered by Google. Once discovered, your site can get punished, resulting in losing tons of business.

It’s also worth noting that new sites pop up every day and thus competition is fierce. If you don’t develop your site, it might hit a decline and eventually get worthless. This isn’t something that happens when you buy Apple stock. Then you can just sit back and wait, time will probably help appreciate rather than depreciate the stock you hold.

Growing the investments you’ve made

Once acquired, I’d assume both you and me want to grow our sites in order to generate more income and appreciate in value.

There are some basic measures that help almost any site, such as:

  • Publish more content on the topic of your site
  • Publish content in neighboring topics to what your site is about, in order to expand the niche
  • Improve content already published by updating, expanding and optimizing it
  • Get quality backlinks from other sites
  • Improve click-through to affiliate sites
  • Improve site speed
  • Add more revenue streams such as display advertising on an affiliate site

The best way to buy a site is to already know what can be improved before you purchase the site. This requires both research (to find the opportunities) and experience (to understand how easy or difficult it will be to do).

Sites that have already grown large, meaning at least 6 or maybe 7 figure price point, almost certainly have the basics covered. They are fairly authoritative, have good content, have broad content, have a lot of backlinks, have multiple revenue streams etc.

Smaller sites usually have much more room to expand and be optimized.

My goal is to learn how to take sites generating some revenue and grow them by 10x in a few years. This would let me grow much faster than starting sites from scratch. It would also require less capital than buying high 6 figure sites from the start.

Future topics and opportunities

The more I learn about this business, the more I understand I still have things to learn.

To be good at growing sites, you need to have good freelancers or the willingness and skills to do the work yourself. I’d rather outsource since, that enables more growth than making everything dependent on the availability of my time.

While running a digital agency in the past, I learned the value of good freelancers. They’re easy to work with, reliable, decently priced and very good at what they do. Like the dream employee, but without the downsides.

Once running, I believe the best deals are made with off-market opportunities, but I don’t yet know where to find them. The same holds true for real estate, privately held companies etc. If you’re the only bidder, it’s easier to get a good deal.