Buoyancy Digital - Digital Media Buyer

I once had an unforgettable retail encounter at the Gateway Computers store in San Diego. It was the year 2000 and Gateway was king when it came to PCs. Remember them, the brand with the black and white spotted cow logo? You know you do! They were as ubiquitous and visible in their peak as the once mighty AOL, who so kindly adorned every coffee table in the USA with enough free trial CD-ROMs to provide complete coaster collections for the bulk of the population.

The point is, I had broken my PC Card modem (PCMCIA back in the day), and while there were already options to buy and replace products with merchants online, I decided to do it the old-fashioned way: I was going to go to the actual store.

Thus one fateful Saturday saw me, broken PC Card modem in hand, pay a visit to the local Gateway Computer shop to buy a replacement. Simple enough, right? I was even aware that Gateway would probably charge more than other places, but since they were close by, kitschy, and cool, I figured it was worth it. I actually thought buying a modem from them would reinforce their image and leave me wanting to buy a Gateway laptop down the line.

Upon entering the store, I could clearly see they stocked and sold the exact item I needed: the laptop modem card. The staff (who for the record were very professional and very nice) engaged me, asking how they could be of service. I told them what I wanted to buy and they paused, then asked me if the modem was for an existing Gateway laptop, or for one I had on order.

Figuring they were just using a sales technique to prop up Gateway products, I politely explained that I didn’t own a Gateway laptop, nor did I have one on order. Without a moment’s hesitation, the well-spoken staffers informed me thatcompany policy prohibited the sale of peripherals they sold *in their stores* for use with non-Gateway products.

Say what?

Visa in hand, ready to pay the stiff retail markup for this add-on, I was literally told I couldn’t buy the laptop modem card. (This was particularly annoying since Gateway wouldn’t even have to provide support after the sale due to disclaimers in-store regarding 3rd party products). No ifs ands or buts, and no one even suggested alternative stores where I could get what I needed.

But wait! There’s more! The uber helpful store helpers then shared that they’d happily sell me a PC Card if/when I bought or could document existing ownership of a Gateway laptop. (Right, because by now I was oozing brand loyalty for them).

Then … wait for it … they let me know that as a non-Gateway customer, I was allowed to buy their miniature stuffed cow mascot, which “could be given as a gift.”

!!!

In the 15 or so years since, as both a consumer and manager, I was directly involved in the purchase of or approval to purchase for staff, dozens of laptops. You probably know where this is going. Guess how many Gateway laptops I purchased or approved (ever)? Yep – zero. In some instances, buying from them years later would have even saved me or my teams I worked with a few bucks. It didn’t matter. Inflexibility lost them a customer for life.

My own personal passion for the digital universe has driven my career – whether that involved buying and selling over a billion click-throughs, managing digital display media sales, SEM campaign management, digital content licensing or where I am now, managing our kickass eCommerce tool at OpiaTalk for accelerated sales growth. The point is, whether selling people-backed products or services, the constant has been that client experience needs to be exceptional, period.

Even if you can’t satisfy every desire stated by your clients, I’ve observed that they can and will stick by you if a) your product or service creates measurable value (real ROI), and b: you treat them well, which means meeting their actual needs, whether or not that involves you.

When I sold ad space, clients needed new staff, hosting, language services, application development and related services all the time. I made it my business to understand the service provider ecosystem behind the digital universe. If I couldn’t provide the solution, I could at least point a client, vendor, partner or lead in the right direction. I always tried to find someone who could help – and I certainly didn’t penalize people for not using our ‘products.’ The most important thing was whether customers (or potential customers) were getting what theyactually needed.

Today, I manage digital operations at OpiaTalk. My colleagues and I have the humble pleasure of overseeing every facet of account care inside and out for some of the largest and most successful eCommerce companies and institutions around the globe. These clients and aggregators use our widget to drive sales growth online from the organic traffic they already have.

Thank you, Gateway, for your unforgettably bad customer experience; it has informed my view of customer relations ever since. Which is:

Treat clients better than you wish to be treated. Exceed expectations. Get in their heads and their industry, to understand what they truly need. Then help them get it. If you help with that, your clients will be happier, spend more, and retain, aka stay with you longer, no matter what you sell in the marketplace.

Above all, never offer them a stuffed spotted cow when what they really need is a solution.

So it's true. We all proclaim to embrace the universality of shopping for anything online, but as humans, we have reserved the right to simply 'not go there' for certain types of shopping needs.

For many, that no-go for online shopping threshold can be clothing (if I can't try it on before I buy, it will be a PITA process of returns and trying to make off the rack clothing fit a non-standard body); for others, it is perishable food products (why should I buy this cake, produce or other specialty grocery item from 2000 miles away that will need dry ice shipping and may arrive squashed from rough handling? Personally, I have overcome the objections of others as well as my own reservations & have succumbed over time to enjoy the price, availability and variety options available, when buying most things online, including clothing and perishable food items.

Even as a 20 year digital media and eCommerce professional, plus being a passionate internet super user, I too had a no-go zone for shopping online - buying prescription eyeglasses. In retrospect, I am not sure why I had such a hangup. Over the past 20 years, working in front of digital screens and small font text data has taken at least part of my optical capabilities, requiring that I wear glasses, for over 10 years now.

Add to that the reality of the retail brick & mortar experience for most people when it's time to get your peepers checked and buy updated prescription glasses. Frankly, it's not always that much fun. It takes many hours on a day that you may prefer to be spending quality time with family or friends. The selection of frames may be limited, depending on where you live, for demographic reasons controlled by the optical retailers. Lastly, the optical shopping experience can feel like the car buying process - as related to the deep and wide range of up-sells and options that both optical retail professionals and automotive sales professionals bring to bear during the manual 'check out' process. (Did you know you were going to need 4 different 'coating types' for your lenses?) Thus, despite almost two decades of internet shopping awareness & comfort, plus a dislike for the offline experience of shopping for eyeglasses, I did not 'go there' until last month.

Behold, a savior from the worlds of consumer eye wear and planet internet shopping, requiring consumers to have an open mind! In August, I already had a fresh updated prescription for glasses that needed to be filled from seeing the local optometrist. The optical retail stores I had local access to did not have anything I liked that was reasonably priced for frames. A friend from my professional life finally said, get over your hang ups and trot over to Glasses.com - find what you like, enjoy the shopping process and get on with your life.

Despite being an innate skeptic, I dove in, as it couldn't be worse than my retail experiences over the years. The complete user experience of working with the merchant from start to finish and after the sale, from ease of use with the web site, the styles available for purchase, their mobile app on iPad to"try on" and then a couple of painless customer service interactions via email and phone with sharp support staff, made this buying experience my best ever for eyeglasses overall and one of the best for online shopping in general.

This is not a shameless plug for one digital merchant who treated me well. The takeaway is more about a wake up call to challenge consumer comfort zones as online merchants overall, and then delivering the finest multi-touch user experience possible. Customers who had their views converted on an entire range of online shopping behavior that walk away from your (web) shop happy, will not only be prone to repeat purchases with the merchant who won them over, but also with merchants overall in the previously ignored online shopping category. Get it right and evolve a generation or two of consumers to buy more online that they actually want/need, where and when it makes sense, even in those prior no-go digital shopping categories.

Scott Rabinowitz doesn't get many calls from business reporters who want to write serious stories. He understands, "They tend to focus more on the controversial rather than our business practices. It's more fun and amusing than asking me to provide analytical feedback."

But we suspect mainstream content marketers could learn a lot from the adult world. After all, it's a massive, intensely competitive, industry selling millions of subscriptions across every demographic over 18. As Rabinowitz points out, "It's relevant to all humanity; and one third of searches across search engines are adult on everyone's network, not just one part."

Also, VCs and banks won't touch the industry for the most part - so adult subscription marketers have to make at least a dollar back for every single dollar they spend.

As the head of one of the only online advertising agencies and affiliate networks specializing in adult content sites, Rabinowitz is in the heart of the action. "Our affiliate network handles three times the financial output of eBay's affiliate network," he says.

We asked Rabinowitz who admits, ""I spend more of my time looking at spreadsheets and contracts than I do looking at content", to reveal what he's discovered from these spreadsheets that might apply to the mainstream content world...

Quick Data - Pricing and Lifetime Value

The average adult marketer's "pain threshold" to acquire a new subscriber is $35.

Subscription prices range from $7-10 per month for lower-value sites with static image galleries; to $29-49 month for general "mass interest" sites with a wide range of broadband content that's updated frequently.

So, if you do the math, it's obvious that average subscription lifetimes are often only two-three months. There's high churn, which makes sense given the impulse buy factor and competitive marketplace.

Although mainstream publishers tend to price niche content more highly than general-interest content, pricing for niche adult sites is often fairly low at $9.95-$14.95. However, the average account lifetime for a special interest adult site offering lots of exclusive content can be six-nine months. (We know plenty of mainstream sub sites that yearn for that month-to-month lifetime.)

Lesson #1. Raising Profits with Cross-sales Interstitials Between Competitors

"Even if you're generating 4-5 conversions for every 500 clicks, you could get the other 455 to buy something from a competitor or peer," explains Rabinowitz.

"It's reasonable to assume that consumers coming to the site from a relevant search are willing to plunk down a credit card. You can effectively reallocate that consumer as an asset by making a qualified recommendation for other sites."

On other words, adult subscription sites often run exit pop-ups and interstitial ads promoting direct competitors to all the traffic that comes to their marketing pages but doesn't convert.

Makes sense, after all mainstream print subscription marketers have been bartering and renting each other's expire lists for years.

Does it work? "I can tell you some adult merchants generate upwards of 10% of their gross return on investment of any tangible conversion activities through it."

So, 10% of your online ad costs can be covered by simply promoting competing offers to all the traffic that doesn't convert on your offer.

Lesson #2. Improve Search Marketing Conversion Rates With Targeted Landing Pages

Rabinowitz agrees with search marketing experts around the world when he says, the more you customize your search marketing landing pages to match individual search terms, the higher your subscription conversion rates will be.

So, if someone searches for "heart health advice", a general health site will get far more subscribers if the initial clickthrough page that focuses on that specific topic. "The likelihood of people buying increases three times to tenfold, when a well-created landing page emphasizes the exact item they were looking for."

Also, "landing pages do need to be short and sweet in the world of adult merchants. You have roughly a couple of seconds to make an impression to make the user consider going forward."

Lesson #3. Mass Portal Sites Can Use Boutique-style Niche Offerings to Raise Conversions & Lifetime Value

Rabinowitz says even mass portals and general interest content sites should take advantage of the proven fact that niche offers convert better and have longer lifetime subscriptions.

His advice - create a series of boutique-areas in your site.

This idea, pioneered with huge success by large department stores 30 years ago, works just as well for adult subscription sites now. In fact, Rabinowitz thinks it would work especially well for family-oriented sites, because everyone in the family gets a site targeted specifically to their interests with the convenience of one monthly fee.

So your newsletters, community functionality, content archives, etc., should be available in niche-branded areas within the general site. If subscribers want to take advantage of the rest of the site, they know it's there, but they don't have to wade through generic content to get what they're looking for every time they visit.

Lesson #4. Lifetime Retention Starts With Your Banners

The adult industry has tested everything it can to increase lifetime subscription retention, because that way lies more profitability.

One winning tactic that may startle you -- include your subscription price, or text indicating a credit card is required, in your advertising banners and search marketing copy.
You are in effect pre-qualifying the traffic that comes to you (especially important if you're paying per click.)

"You start building retention even before the point of sale," explains Rabinowitz.

Next, he advises sites to tweak their order form pages to eliminate "buyer's remorse" by stating month-to-month billing terms extremely clearly, and by telling people how great your customer service is in case of lost passwords, tech support, and even cancels.

After conversion, sites should contact subscribers on a regular basis (Rabinowitz suggests weekly) to let them know about both new and upcoming content. The more you can emphasize exclusivity, and "this is not available free elsewhere," the better.

Note: Got questions for Rabinowitz? He says he's going to try to make it to the ContentBiz Summit on Selling Subscriptions in New York this May, to network and learn even though, "I may be the only adult content guy there."