Before you pass this article by in favor of something you believe is more exciting, like streaming video ads, wireless multi-player games or interactive TV, think back to the last corporate fire drill that occurred towards the end of a fiscal quarter. This is where the CEO asks “how much are we selling, are we going to make our numbers, do we have the inventory to fulfill campaigns, what is our sell-through rate, why do we have unsold inventory and what are we going to do about it?”
If you have ever been caught in the eye of this storm, you either wish you had people who could supply this information on a moment's notice, or you patted yourself on the back for having the foresight to staff up with an inventory analyst.
This article is about inventory, the importance of managing it and the people who can help you do that. Along the way, I’ll cite some hair-raising real life stories on inventory “mis-management” that unfortunately, you may be able to relate to.
First, let’s take a step back and put the issue into perspective.
For publishers who depend on media dollars for their livelihood, selling is just part of the equation. From there, insertion orders are routed to an ad operations group and are scheduled into any one of several ad serving applications available on the market today. Most of the brand name ad servers have a function that enables sales and/or operations to get information on available inventory. Sales and operations folks know this drill all too well. Most would also agree that inventory management systems are still a “black box” that can only tell part of the story and are at best inaccurate. They can’t take into account the day-to-day idiosyncrasies of selling in today’s market with today’s products.
Many publishers rely on their ad trafficking staff to give them insight on inventory. The problem is, most of them are so busy with the day-to-day tactical chores of receiving orders, sending them back for corrections, testing ad tags, responding to customer requests to change campaigns, that the last thing they have time for is thinking about inventory.
The job of thinking about inventory belongs to an “inventory analyst.” Unfortunately, for many publishers, this is a head count they don’t consider, or think they can’t afford. But as online media gets more complex, they will find they can’t afford NOT to have a staff position for this individual.
Now, before your eyes glaze over, I’ll relate some real life adventures in inventory terror that could have been prevented by having an individual devoted to understanding this part of the revenue equation:
- A publisher finally gets the Packaged Goods client they’ve been dreaming of. They are interested in promoting a candy bar and want to use a rich media floating ad, displayed during the afternoon hours of 1 pm to 5 pm, to reach a youth audience just when they need an energy boost. The ad trafficker takes the order and is so busy, he just takes the order. He fails to notice that 1) the rich media ad takes a total of three impressions to load 2) there is a frequency cap of one per user per day. The campaign starts to run, and you discover that the 10 Million home page impressions you thought you had has now turned into 1 Million. The client is furious about under delivery. The salesperson is at your desk wanting an explanation. The make-good you need to run to fix this has a ripple effect that impacts every other client on your website.
- It’s the beginning of Q1 and everyone is just getting back to work. An order comes in from a client who says, “I’ll buy every pop-under you can give me for a $5 CPM. My budget is $400,000. Just send me the IO.” The order somehow gets signed and noted as booked revenue. Unfortunately, based on the number of uniques on the site and the frequency cap and the fact that there are seven other rich media campaigns scheduled during the quarter, there’s only $200,000 worth of pop-under inventory to serve. As the quarter goes by, everyone is happy with the booked revenue. As the end of the quarter approaches, management wonders why $400K of booked revenue isn’t being delivered and comes down on the traffic department who scheduled the ads and asks them “why aren’t you monitoring our inventory?”
The solution to avoiding these problems is to have an inventory analyst on staff who, on a daily basis, monitors the site to determine how campaign delivery is matching up to booked revenue; an individual who knows how to calculate available inventory for complex campaigns that involve frequency caps, rich media, demographic, behavioral and geo targeting. The inventory analyst should also be able to create trend reports that give the business insight into how their inventory is being utilized, and recommend pricing and product strategies to increase yield.
The airlines have spent billions of dollars creating reservation systems that help them manage their inventory. Since your livelihood depends on making sure that booked equals delivered inventory, shouldn’t you consider spending slightly less to make sure your staff can give you the ability to monitor and manage your business?
Doug Wintz began his interactive career with Prodigy in 1988. During that time, he pioneered the sales and development of online applications for automotive clients Toyota, Ford and Autobytel, brokerage firm DLJ Direct and grocers Dominick’s and D’Agostino. He led the development of one of the first online ad networks for Softbank, managed sales/operations for gamesite Uproar and recently served as VP of Digital Media Solutions for Lycos. Doug is currently founder and principle of DMW MediaWorks, a consultancy in interactive media and operations, with long-term clients that include the market leaders in online health, broadcast television, behavioral targeting and custom publishing.
NextStage engagements often begin with us saying to clients, "Tell me about your audience." The best responses come from clients who have spent time and money researching their audience. Less helpful responses start with, "Umm...well...ah...let me see..." These responses are expensive because they indicate the client doesn't know their audience well enough to market successfully to them.
It is NextStage's belief that you can't market successfully to anybody until you know who they are, what they think, how they think, what they respond to and what they'll respond with. The smaller your target audience, the more you must design specifically for it. Large audiences are easy to design for; keep it simple! In all cases, the safest design method is one I described at the San Francisco Emetrics Summit as similar to the first contact scenarios in "Star Trek." People with my training and background often learn this as: The first message must be instructions on how to build a receiver.
That statement is the stopping point for many. You need to answer two questions the statement is asking before you can make it work: Who's sending that first message? Who's receiving it?
Most people think, "I want to get a message to my audience, so I'm sending and they're receiving." Good answer and full of problems. It's very challenging to create actionable instructions for an audience if you don't know much about them.
The correct answer is something like this: "I want to get a message to my audience, so they must teach me how to create a message they will act upon."
Whoosh! The first message is not from you to your market, it's from your market to you and is: "This is what will get our attention, so this is what has to be in your marketing message."
The first message is to you from them. It contains instructions on how to craft a message they will willingly receive and favorably act upon, for example, how to build a receiver they will be able to use.
NextStage's most widely used method to help clients build receivers involves placing a small piece of tracking code on the client site. NextStage's tracking is different from web analytics tracking, behavioral tracking, et cetera., because we're not interested in analyzing websites, we're interested in analyzing people. NextStage's tracking determines visitor logical processes, cognitive processes, decision styles, memorization methods and emotional cues. There are more than 80 items at present, and we're adding more as our research progresses. These 80 items cull down to about 45 directly actionable items for our clients: age, gender, buying styles, best branding strategies, impact ratios, touch factors, education level, income level and what NextStage collectively calls the CB/EM -- Cognitive, Behavioral/Effective and Motivational -- matrix.
In the case of Emetrics, NextStage has been tracking site visitors' cognitive, behavioral/effective and motivational activity on the Emetrics Summit site since March 1, 2007, so we have a rich CB/EM matrix of the existing Emetrics audience information to work with.
Knowing your audience in depth and detail is a required first step. The more richly detailed and complete your knowledge is about your audience, the more you can do to build a receiver -- a website, video, print ad, et cetera -- they will naturally and effortlessly interact with. There are two crucial elements to "receiver" design that come from the previous section's discussion on a rich audience personae and specifications for building that receiver.
Let's consider each of these elements on their own and use the Emetrics Summit as an example in both cases. The first -- rich audience personae -- is incredibly straightforward. The Emetrics Summit's organizers know who their existing audience is: web analysts. All web analysts think alike, yes?
All web analysts think alike at certain times and regarding certain things, yes. The rest of the time, web analysts are as different from each other as any other collection of randomly selected people you'd find walking down the street. A rich personae starts with the basic personae description you'd find most anywhere: they're this old, this educated, they have this kind of job, they're interested in these kinds of things, they have 2.3 children and half a dog.
The next layer of a rich personae determines the CB/EM matrix. In the case of Emetrics, some of that CB/EM matrix was shared in Mapping Personae to Outcomes. At this point, we know what the audience looks like and how they think. We complete that rich personae by elaborating what they'll respond to in rich environments, for example, not only on a website, on TV, in print, but also who and what needs to be at the Emetrics Marketing Optimization Summit in order to fill the seats. This was first done at the request of Lunametrics CEO Robbin Steif, when she asked who WAA members would respond most strongly to. A simple analysis revealed the characteristics of presenters that Emetrics organizers needed to have at their Emetrics Marketing Optimization Summits:
- 35-45-year-olds who have been analyzing websites for 10-plus years both in and out of corporations
- That have been doing web analytics for 5-10 years, and ditto for large and small businesses
- That have spoken/presented at major conferences
- That have "hands-on" knowledge of at least five different analytics platforms
- That have product neutral (no commercial affiliations)
- That are patient with ignorance
This determination was made via NextStage's TargetTrack tool prior to engaging with Emetrics, and it was later incorporated into the engagement process. Interestingly enough, the majority of presenters at Emetrics had most, if not all, of these characteristics, even though NextStage, at the time, had no knowledge of the summits at all.
The second crucial element is doing what NextStage calls Audience Focused Optimization (NextStage will be offering an Audience Focused Optimization workshop at the DC Emetrics ’07 Summit). This is where the receiver gets built.
The website can already exist or be in the development stage, it doesn't matter. All that really matters is that the end result be something your target audience will both pay attention to and favorably respond to.
Several market-specific suggestions were made to the Emetrics Summit staff prior to the May 2007 San Francisco Summit, some of which were documented in previous columns. I also shared some of these suggestions and visitor responses to them in my Emetrics Summit presentation, "Quantifying and Optimizing the Human Side of Online Marketing." For example, knowing how the audience thinks enabled design modifications that kept visitors engaged and returning through the redesign process. The end result of these efforts was demonstrated by visitor comments and emails.
The simple fact that Jim Sterne and his crew let visitors know ahead of time when a redesign would be online resulted in three major outcomes:
- The day the redesign went live, the site experienced huge spikes in traffic, levels of interest and navigation.
- People emailed that they'd been on the Emetrics Summit site and noted the update announcement.
- Other emails demonstrated that people had returned specifically to discover what had changed since their last visit. (The wording in that last line is intentional. People didn't return to "see," they returned to "discover." They were on the site thinking, evaluating, analyzing, interpreting. In other words, they were engaged.)
Automating the Suggestion Process
NextStage's Active Intelligence tool combines these three steps and generates a design modifications report containing a series of suggestions for new and existing marketing materials. (These suggestions are generalized for this column and please, please, please don't assume they apply to every event and conference site out there.)
Each level contains critical, important and desirable elements. Further, each level is built on completion of the previous level's suggestions. In all cases, the suggestions are meant to be simple modifications to existing sites and easily implemented directives for sites in the making.
Some of the suggestions provided for Emetrics Marketing Optimization Summit included:
- Use fewer menu items
- Rename remaining menu items so that they are questions that can be answered
- Make the menu system/structure completely consistent from page to page
- Make the progression of pages tell a story so that one web page logically and thematically leads to the next web page
- Make the menu system either consistently horizontal or consistently vertical (remove top-of-page city menu and replace it with graphic links that already exist within the banner image)
At this point, design modifications have been implemented to maintain Emetrics Summit's dominance in the web analytics market. Entering new markets is simply a matter of modifying the inputs to these same NextStage tools, and utilizing Emetrics Summit's existing recognition as one of the parameters available to enter new markets. This allows Emetrics to take its existing look and feel and only make the necessary changes to establish itself in marketing, search and other optimization market segments.
Simply stated, Emetrics can take its existing brand and modify it enough to stimulate interest in new markets while retaining the dominance and loyalty established in the old markets. People wanting to come to an Emetrics Marketing Optimization Summit will know that a proven and well-established brand is behind the new venture, bringing existing credibility to the new effort. This allows the new audience to borrow an expectation level from Emetrics Summit's existing audience base by recognizing and sampling their experience (which has always been highly satisfactory).
This methodology -- taking what is known to be successful "here" and only changing what is required in order to be successful "there" -- has an enormously long and (ahem!) successful history. It has worked for every civilization that expanded its territories via trade -- as opposed to conquest -- and is the basis for the most long-lived cultures on the planet.
"The insights NextStage provides are all obvious-after-the fact," Emetrics’ Jim Sterne reported. "Their recommendations make infinite sense once they are on the table. The amazing part is the social science behind what seems like logical web usability."
Links for this article:
• Usability Studies 101: Redesign Timing
• Focusing Your Customer's Attention
• Usability Studies 101: Experience as an Equation
• Headlines That Attract Attention
• Keep It Simple to Maximize Market Share
• Tips For Your Next Website ReDesign
Joseph Carrabis is CRO and founder of NextStage Evolution and NextStage Global and founder of KnowledgeNH and NH Business Development Network. He was recently selected as a senior research fellow and board advisor for the Society for New Communications Research. Read full bio.
Keep it simple
There are three key things that need to happen for a user to be able to complete a task successfully: understand the task, follow directions, and easily submit results. As a general rule, you should be able to explain the task in less than 30 seconds. The task should be clearly defined and include only one call to action.
By limiting the number of steps it takes to participate, you will increase the likelihood of a user completing the task. It may be necessary to visually outline directions with images or video, especially if the concept is new to your audience. Make it as simple as possible for users to submit results and that it is clearly defined in the instructions.
In SeaWorld's most recent Facebook initiative, users are introduced to an entirely new type of game, called "Photo Adventure," that challenges them to find mistakes in images. The application targets parents of young children by providing a task that they can complete with their child. Upon entering the application, users are introduced to the game's objectives with easy step-by-step instructions and images.
In contrast, SeaWorld's "iPod from myPod" Twitter contest has complex instructions that do not include images. Using the @Shamu Twitter profile, SeaWorld issue tasks related to brand imagery found on Google Street View. Participants then had to take a screenshot of the image and fill out a form on the contest landing page to enter. This contest requires users to visit three websites in order to complete a task, which may be confusing for some audiences and therefore limits participation.
Know your audience
The task that you create should align with the social media habits of your target audience. This will help eliminate confusion on how to participate and will make it easier for consumers to explain the task to their network. Most importantly, understanding your audience will allow you to create campaigns that are exciting and relevant to the user.
Forsman and Bodenfors had audience in mind when it promoted a new IKEA store by asking users to tag themselves in showroom images found on Facebook. Forsman and Bodenfors built a profile page for Gordon Gustavsson, the manager for the new IKA location in Malmo, Sweden, to host the photos, and when a consumer tagged an item with their name, they won that item.
IKEA knew that its young, tech-savvy audience would understand the tagging feature, and would find the concept creative and worth sharing with their network.
Align the task with the platform
When deciding on a social media platform, take into consideration your marketing objective and the task that you are challenging users to complete. If your goal is to drive definition and you have a lot of content to share, Facebook would be the best solution because of the sharing options it offers.
If your goal is to drive brand awareness with little content, and you have the ability to actively interact with consumers, Twitter would be the best platform to use.
Also, be sure to consider the task that you are asking users to perform. Each social networking platform has content elements that users are familiar using in comparison to other platforms. For instance, when Bing asked users to submit photos to its "Home Sweet Homepage Photo Contest," Facebook was a natural choice because users were already accustomed to sharing photos on the platform.
Keep in mind that the platform you choose should make sense for your target audience. Facebook, Twitter, YouTube, and MySpace are more effective for different audiences based on age, gender, education, and social status.
Make incentive relevant to the brand
The first question most users ask themselves before deciding to participate in a brand's campaign is "what's in it for me?" Not every social media initiative needs to be tied to a contest, however, there needs to be a clearly defined incentive for the user to complete the task. The incentive should be relevant to the brand and should support the marketing objective.
In the case of Bing's contest, users were asked to submit photos demonstrating something unique about their hometown. The winner's photo became the background for Bing's homepage for a day. This incentive gave users the chance to participate in creating Bing's homepage, and simultaneously drove them to the new Bing search engine to view the winners. The most effective campaigns include creative incentives that drive users to not only engage with the brand, but to share the campaign with their network.
Engagement is key
In all of your social media endeavors, keep user engagement top of mind. Unlike traditional media, social media only works if consumers are actively participating in campaign initiatives. Be sure that you are designing tasks around your audience's interests and strengths in order to increase interactions.
Social media campaigns that allow users to redefine themselves through brands are met with the most success. Social media is in its purest form is about communicating online, and most social network users utilize the media to communicate information about themselves.
Retail chain Target recently created the "Bullseye Gives" campaign that reinforced the brand's focus on building community by letting its Facebook fans decide which charity they should donate to. Target gave $3 million in donations to 10 charities, chosen by Facebook users, including St. Jude's Children's Research Hospital, American Red Cross, and The Salvation Army. By participating, consumers were able to communicate which charities were important to them and were motivated to share the campaign with their network.