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October 18, 2006 by Jonah Stein Leave a Comment

Pay To Protect Your Privacy?

Privacy and Security: two things consumers want most and get least.

PoundPrivacy.org is advocating for a search privacy standard. The idea is pretty simple: If you include the phrase #privacy at the end of your search query, the search engine should not associate an IP or Cookie-identifying info with that query.

The first engine to adopt this idea (other than Google) will grab an instant buzz and a real market boost. This issue goes way beyond search. There is a huge opportunity for businesses to develop and prosper by shielding consumers’ personal information while giving them access to products, services and content.

The most popular act of Congress in the last decade is the Do Not Call Registry. Two thirds of Americans approve of the act and half of those who are unhappy say it didn’t go far enough.

1. Anonymizer extension for Firefox or perhaps a separate application. Generate random information at the beginning of any session delete the information. Include any identifiable information that could be tracked or associated in the future such as MAC address or CPU I.D.

2. NotMyKink, an anonymous proxy/avatar system that lets users search, subscribe and pay for content without providing their name, leaving any tell-tale signs on their computer or unexplainable charges on their credit card. Privacy isn’t only about adult content, but it is a huge piece of it. Porn is also a $10 billion/year business. This service would generate enormous revenue as an affiliate/reseller for adult content from users who haven’t subscribed because of privacy concerns.

3. NotMyAddress, an anonymous proxy/avatar system that lets people order products online and provide a shipping destination as an account and zip code only. Vetted couriers (FedEx/UPS/USPS/?) would be able to print a label based on the ID once the package has left the vendor.

4. NotYourBusiness, an anonymous proxy system that lets users surf without any logging or caching function at all.

5. Surrogate-Ma-Bell, a phone forwarding site that allows users to set up a temporary number that forwards to a number of their choosing. The temporary number would expire, severing the contact unless the user decides to maintain it.

October 13, 2006 by Jonah Stein 7 Comments

10 Ways Consumers Can Get Revenge

Have you been wronged by a company and they won’t do anything about it? Here are 10 things you can do to get even.*

1. Dispute the credit card charge
There is a widely circulated rumor about a merchant who won a charge back dispute, but there is no confirmation it actually happened. Credit card companies almost always side with the consumer when there is a complaint about an online purchase. After hours documenting every interaction with the customer, reciting the terms and conditions and proving they did everything right, companies lose the dispute and pay the charge back along with a processing fee. Savvy merchants don’t even bother to fight payment disputes; it is a waste of time and money.

2. Build a complaint site
Got a lot of time on your hands? A huge percent of online traffic comes from visitors searching for a company by brand name. A complaint site can appear right below (occasionally above) the brand the user is searching for. Google United Airlines and the 3rd result is for Untied.com, a site dedicated to complaints about United.

Negative reviews can obliterate the company’s brand in search engine results. Take the case of a now defunct search engine optimization company called Traffic Power. They decide to sue some bloggers who were critical of them. Instead of silencing their critics, the lawsuits rallied the SEO community, generated thousands of back links to the story on SEOBook and helped propel Aaron Wall into a celebrity. The top ten SERP’s on Google for “Traffic Power” are dominated by websites slamming Traffic Power. Traffic Power is out of businesses.

3. Blog About Your Experience
If you don’t have the time, the skill or the anger to spend weeks building a complaint site, write about your experience and then post to social media sites like Digg and Reddit. Companies invest millions of dollars in their brand – few things are more damaging than having complaints show up on the top of search results.

A blogger wrote about his bad experience buying a camera online and posted it to Digg.com. Beside the usual advice, dig users posted the store’s numerous aliases, phone number and address. Users flooded the 800 number with phone calls, wrote scripts using Skype to call and disconnect, making prank phone calls, launched DOS attacks against the site and posted bad reviews on various websites. Not only did the owners write an apology letter and claim to fire the manager, they had to change their brand. PriceRitePhoto is now BarclaysPhoto and the damaging blog still shows on the first page of results.

Reputation management is a serious issue and a real problem. It could cost the company tens of thousands of dollars promoting favorable reviews to push one complaint posting off the first page of search results and there is no guarantee it will work. It’s not unheard of for the company to offer cash to get someone to take down a bad review. When this happens, savor the moment and don’t accept the first offer…the negotiation has begun.

4. CPC Click Abuse
Unscrupulous people might spend a few seconds every day clicking on paid links for a particular company. Invalid clicks can cost a company a lot of money. For example, the search term “postcard printing” on Google brings up sponsored ads that cost between $5 and $10 dollars per click.

This printer now has 200 legitimate prospects mingled with 1,300 freebie request. Each sample pack cost about $5 to fulfill, so it could cost $6,500 to send 1,300 samples to people who want a freebie. Each legitimate request costs about $25 in marketing, so not fulfilling the 200 legitimate requests would cost $6,000 in invested dollars and around $25,000 lost revenue. In the end, it took at least 30 man-hours to straighten out the mess and another 20 hours for IT to put in a fix. A week later, someone reposted the new link on another site along with instructions on getting around the fix.

6. Better Business Bureau
Even if the company isn’t a member, maintaining a clean BBB file is very important; many consumers will check the BBB before they make their first purchase. A company can be classified as “Not Recommended” with as few as 3 unresolved complaints even if they have a million customers who never complain. It takes many hours of paperwork to respond to each complaint. Even if the company responds, it is still up to the consumer to agree the complaint has been satisfied. Eventually, after spending a lot of staff time, the company may prevail and have the complaint ruled in their favor, but the complaint never gets taken off their record.

7. Write a funny email describing how incompetent the company is
Never underestimate the viral power of a well written email. Send it to everyone you know with the subject of “funny story” and they will send it to their joke list. The trick here is to make sure to paint a portrait of a beleaguered customer faced with an incompetent policy and an unbending bureaucracy. Try Alexa or Epinions if you want to keep going.

8. Link to them
Opinions differ about how much harm can be done to a company by linking to them from “bad neighborhoods” such as link farms, porn sites and affiliate sites that promote online casinos, debt consolidation and viagra. It would probably require a “Black Hat SEO” professional to really do much damage and this will never work for an established company like Amazon.com, but a newer website without a lot of inbound links is certainly vulnerable. (If anyone has a list of ways to get a site penalized or banished, let me know and I will link to you.)

9. Send them Dog Poop
You don’t have to touch it because there are two companies that will do it for you: DogDoo.com or Mailpoop.com

10. Buy from someone else!
The fact is, it takes a lot of money to attract a new customer and it is in the interest of a company to try to retain almost every one.

*This is meant as a cautionary tale for business owners, not a recommendation for consumers. The ROIGuy is not suggesting you take any of these actions. He is not an attorney and has no opinion whether pursuing any of these strategies is a violation of federal, state or local laws or civil statutes.

October 10, 2006 by Jonah Stein 1 Comment

6 Reasons Jakob Nielsen’s Blog Participation Analysis is Flawed

You can always prove your point by defining what to measure. Jakob Nielsen is a renowned pundit, the leading evangelist for measuring results of user interface design and one of the most experienced and influential voices in design. His October 9th Alertbox shows how even the best pundits can fall into the trap of drawing conclusions using measurements from incompatible systems.
Nielsen’s intent is laudable. He contends that the vast majority of users are consumers of content instead of creators and is urging site operators to make participation easier.
User participation often more or less follows a 90-9-1 rule:

* 90% of users are lurkers (i.e., read or observe, but don’t contribute).

* 9% of users contribute from time to time, but other priorities dominate their time.

* 1% of users participate a lot and account for most contributions: it can seem as if they don’t have lives because they often post just minutes after whatever event they’re commenting on occurs.
Nielsen goes afoul when he talks about blogs, “There are about 1.1 billion Internet users, yet only 55 million users (5%) have weblogs according to Technorati. Worse, there are only 1.6 million postings per day; because some people post multiple times per day, only 0.1% of users post daily.”
“There are about 1.1 billion Internet users, yet only 55 million users (5%) have weblogs according to Technorati. This analysis has three fundamental flaws.
1. Nielsen takes the broadest measurement of internet users and the narrowest definition of a blog, posts using one of the popular blog publishing platforms such as WordPress that happen to report postings to Technorati. The total number of internet users is not the same as the number of blog readers. To assume that even half of that 1.1 billion “users” would recognize a blog as being a blog defies credibility so it makes no sense to count them when measuring participation. Does someone who has never been to a site count as a lurker or passive participant?
2. Comparing measurements of different values from two different systems is unreliable. It is perfectly reasonable to compare the measurement of the same value from two different measurement systems to compare the measurement approach. You can’t do analysis with measurements tfrom two different system without normalizing the data.

Technorati is an American-centric company that doesn’t claim to have an even global penetration.
Blogging is a new phenomenon that has only been in the public eye since 2003. According to Technorati sources, the number of blogs doubles every six months. The August figure of 55 million will be around 110 million by February of 2007. It is approaching 70 or 75 million as of the middle of October.

3. The biggest problem is the definition of “blog”? Blogging is a term that embraces much more than the enabling technology. It isn’t about posting your opinion in Word Press; it is about adding your thoughts, opinions and analysis into the public discussion. Nielsen’s AlertBox, for example, is an opt-in electronic newsletter that is also posted to his site. The content he writes is widely discussed in blogs and gets its share of links from the blogosphere. The only reason AlertBox is not a “blog” is that the technology he uses to publish. It shouldn’t surprise anyone that mixing a broad definition of users and a limited definition of participants produces lopsided results.
Worse, there are only 1.6 million postings per day; because some people post multiple times per day, only 0.1% of users post daily.” Nielsen disappoints again on this point in three ways.
4. Nielsen defines daily participation as the threshold for determining whether someone is a regular contributor to the discussion. His definition stipulates that quantity of posts is the only thing worth analysis. Take Alertbox as an example again. Since 1995, Nielsen has published his column roughly twice a week or about 260 times over 11 years. By his definition of participation, one of the most widely read column on User Interface and Design, written by one of the leading experts on the topic, counts as an occasional contributor.
5. He ignores comments as a form of participation in the blogosphere. Most blogs have at least a few comments and many have hundreds or even thousands. It is hard to justify not including these as participation.
6. The last issue on this point is how he crunches the numbers. Technorati’s measurements are “ancient” as judged by the historical rate of change. Still, if we accept 55 million blogs and 1.6 million posts/day, 2.9% of bloggers post EVERY DAY. If we use a more reasonable threshold like posting once a week or even once a month, participation in the blogosphere may be as high as 10 or 15%.
The 90-9-1 analysis ignores that fact that users are in multiple communities. A user who is a devoted participant in the Amazon community for example, one who has read thousands of books and posted reviews for each, can hardly be expected to be a daily blogger as well, but do you count him as a lurker?
You can prove almost any point with statistics and measurements tailored to your definition. If you want data for reliable decision making, you need to be more thoughtful in your approach.

Technorati Profile

October 5, 2006 by Jonah Stein Leave a Comment

Google–MySpace Deal A Huge Setback For Social Media Sites

This years $900 million MySpace–Google search deal is a huge setback for Social Networking and User Generated Content sites. The proof is last month’s projections that MySpace will add as much as $15 billion to the valuation of News Corp.

This deal was a win-win blockbuster. Murdoch got more in revenue than he paid for MySpace and Google locked in one of the most popular sites in the world along with a great demographic of younger users, effectively blocking its competitors. Yahoo is talking to FaceBook about a $1 billion acquisition.

How can this arrangement be a HUGE setback for Social Media sites? Simple, the search advertising revenue model and artificial valuations distorts the focus of Social Networking sites and User Generated Content sites and turns them into giant affiliate sites for search advertising.

News Corp bought MySpace cheap and they appear to be avoiding big changes so far. As the leader in the space, they are able to be very selective. The only apparent difference is who powers the search box at the top of the page. I am not aware of any data about how much revenue has been delivered through the Google deal, but MySpace clearly continues to grow. It is now one of the most popular sites in the world.

For competing sites with shallower pockets and smaller market share, the need to generate revenue will inevitably compromise the user experience. CPC advertising revenue is a great model—for a search engine. When a community site depends on driving search queries for revenue, it takes the emphasis away from the user’s reason for coming to the site. The site sacrifices whatever makes it unique in favor of a generic user experience.

Social Networking sites are very appealing to the traditional agency mindset that focuses on demographics and building brand. As a Search Engine Marketer, I create and manage ROI driven campaigns. I almost always advise my clients to opt out of the search partnerships and always avoid content matching. In my experience, as soon as you stray from keyword search on a search engine to include search network partners, the ROI begins to drop. Include content match and click through rates and ROI plummets. As web analytics get better, more and more advertisers will either opt out of traffic from network search or the market will devalue those clicks in line with their lower ROI.

Pay Per Click from a search engine produces staggering revenue and ROI for advertisers because users come to an engine looking for goods and services searching for specific keywords that trigger relevant ads. The advertiser decides exactly what to bid on and what text to display for each keyword. The value of keyword search traffic is very high to both the search engines and to PPC advertisers because the USER gets a positive experience.

Social Networking and User Generated Content sites need to develop their own revenue streams based on the characteristics that synthesize their communities. They need to identify specific markets for which they understand user affinity and then figure out how to monetize delivery of relevant content that enhances the user experience. For example, if a site encourages users to list their favorite type of music or musical artists, they could partner with labels, artists or music promoters in each city to sell tickets to the show. Even better, they could negotiate for access to presale tickets and/or a special section in the arena for their members and let users create a buzz around the event.

The inflated valuations caused by this deal may be even more devastating in the long run. Slapping a $1 billion price tag on an immature site with a tons of users puts a lot of pressure on management to cash in. A site that was organically evolving through the interaction with users and slowly approaching profitability is suddenly an entity on the auction block. If the site is sold, it creates an all consuming demand to generate revenue.

Long before anyone coined the terms “Social Networking” or “User Generated Content,” one of the first (and still the best*) community sites was www.Craigslist.org. The site was founded by Craig Newmark, an unusual person with an almost unheard of lack of desire to cash in. Craig has stated on many occasions that the site is nothing without the user community. His title is Founder, Chairman, Customer Service Representative. Craigslist operates as a not for profit entity that has grown organically, with a limited revenue model, a sparse user interface and a fanatically loyal user base who police the site. They have about 20 employees and resist the siren song of growing revenue through advertising, affiliate programs, co-marketing, etc. Ebay bought a minority stake a few years ago but has lived by the agreement they made with the founder to be hands off and not demand a cash return. If Craigslist suddenly sold for the $10-20 billion it would be worth on the open market, the site would have to start generating a few billion dollars a year and fundamentally change the community that created it.

*Full disclosure requires me to state that I have used Craigslist for the last nine years. I met my wife through Craigslist, found a few house mates, a job, and bought things including a hot tub, a pool table, furniture, and Giants tickets. I dream that some day one of my posts will be voted to the “best-of-craigslist” archives.

Pay To Protect Your Privacy?

10 Ways Consumers Can Get Revenge

6 Reasons Jakob Nielsen’s Blog Participation Analysis is Flawed

Google–MySpace Deal A Huge Setback For Social Media Sites

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