Category: social media

  • How group buying can work for a business

    How group buying can work for a business

    Online deal finding site The Dealmix has an excellent blog post analysing how daily deals can work for a business.

    As the Dealmix points out, “daily deals can either hurt or help small businesses, depending on how they’re structured.”

    In figuring out whether a deal will work, Dealmix breaks a group buying deal into four elements; expiration, quantity, terms and price;

    Pricing the deal

    Of all the areas, the pricing is the most critical. Get this wrong and you won’t achieve your objectives and it could be very quickly drive you out of business.

    The Dealmix recommends two ways of pricing an offer – by making a net profit on the deal or structuring it a way that the customer’s total spend  offsets the cost of the offer.

    Using Average Customer Spend, or ACS, to estimate how much a customer will spend is problematic with specials and group buying deals as the takers are not going to be your average customers.

    It’s likely group buying customers are going to be far less open with their wallets than your regulars. Trying to upsell price conscious is probably what brings cafes and restaurants unstuck with many of these deals.

    Both methods rely on knowing the Cost Of Goods Sold and the Average Customer Spend. Notable in the stories of group buying disasters is just how many business owners don’t understand these basics.

    If you don’t know what the total cost is to your business in providing the goods or services, you should be talking to an accountant before going near these deals.

    Also keep in mind the group buying service is going to take their cut which will be between 15 and 100% depending on the size and nature of the deal. For many businesses the commission is a deal breaker.

    Quantity

    The biggest complaint from customers about group buying offers is the deals are booked out for months – it’s also how service businesses find themselves overwhelmed by the response to a keenly priced offer.

    Again, before launching a group buying offer, understand the spare capacity of your business and ensure there is a maximum limit to the number of deals available – as The Dealmix points out, a sold out deal is a great marketing tool.

    Terms

    Conditions are probably the trickiest; put in too many gotchas and you’ll scare customers away or find yourself fighting with the 90% of clients who buy the deal without reading the T&Cs.

    You can guarantee some of those fights will end up being public and it’s unlikely your business will win the public relations battle. This is not your business objective.

    Make sure key terms like what days the deal is available on, maximum limits, types of service are reasonable and clearly defined at the time of the offer.

    Expiration

    When the deal expires is the key condition, it’s madness offering deals that never expires as they can come back to haunt you for years and it may even affect the resale value of your business.

    The Dealmix suggests not restricting it to a month as you’ll be overwhelmed with customers while leaving it too long will dilute the value and any measurements.

    Ideally the deal will last three to six months, which is another reason for understanding your business’ capacity at various times of the year.

    Timing the expiry is important to, as The Dealmix suggests, the deal shouldn’t finish on a busy day and equally you should consider when your business is the quietest. If things are slow during school holidays, summer or Christmas then that might be the time you want to have the last minute rush of redemptions happening.

    Business Planning

    Probably the most important aspect of a group buying deal is how does it fit into your business objectives. Are you intending to build a customer base, contact list, pubicise your business, clear stock or give sales a boost? Those objectives are going to determine how you structure the offer.

    As The Dealmix’s diagram shows, group buying deals are complex and the merchant has to give some thought on getting the offer right. Those business who do get the mix right can do very well from a well thought out online offer.

    Like all business tools, group buying sites can be really useful when done well. The key is understanding what you’re doing with that tool.

    We discuss group buying and building your own campaign in e-business, Seven Steps to Online Success. If you need help or advice in building an offer, Netsmarts can help you.

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  • Pity the poor IT worker

    Pity the poor IT worker

    “Our IT guy has been looking after our social media strategy,” grumbled the boss, “we don’t really know much about that stuff.”

    A constant in business is that anything that vaguely involves electricity gets flicked to the IT guru – setting up a phone’s speed dial, clearing a jammed photocopier or resetting the office burglar alarm are all things tech support gets called to fix. They breathe a sigh of relief that electric typewriters aren’t around anymore.

    In the early of the Internet, it was the techs who were asked to set company web sites – which is like asking your plumber to run a cafe because making coffee involves water.

    Of course some IT folk turned out to be good at designing websites – just as some plumbers turn out to be world class baristas – but it’s a gamble finding out.

    Today the poor tech support teams in the less proactive organisations find themselves lumbered with the social media duties, something most of them don’t care about and barely understand themselves.

    For those businesses, the problem is the corporate social media accounts are now the shopfront along with customer support and, with most journalists using social media, the PR department as well.

    If you’re happy with your geeks looking after your media relations, sales and customer support then ask the IT department to look after the website and social media. Otherwise, you might want to take things a bit more seriously.

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  • Leaving Facebook

    Leaving Facebook

    In our social media segment for December 2011’s ABC Nightlife a listener asked about closing down their Facebook account.

    Leaving Facebook isn’t easy, but it can be done and we’ve covered closing down a Facebook profile on the Netsmarts website.

    The December Nightlife spot looked at a lot of social media issues and answered other listener’s questions about some of the challenges online. Some of those questions are listed on the page and the program

    December’s spot was the last for 2011 and next scheduled Nightlife spot will be on February 9 however we will probably have some segments over the Christmas period and we’ll let newsletter subscribers know as we find out.

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  • Comparing local review and search sites

    Comparing local review and search sites

    With the Australian launch of local search and recommendation site Yelp, it’s worthwhile comparing the different sites to see how well they worked.

    The sites work in different ways, some – like Sensis Yellow Pages and True Local – are online directories that search just the title and description of business.

    Yelp, Foursquare and Word Of Mouth Online, are socially based and derive their searches on the content and number of community reviews. Their algorithms, the formulas to figure out what customers are looking for, are more complex than the basic online directories.

    Most complex of all are the hybrid searches, notably Google Places and Facebook Places, that build local upon their search and social media data.

    Each model has it’s own strengths and weaknesses which shows when we do a search. Due to time restrictions we only did two.

    Looking for brunch in Neutral Bay, NSW

    The first search was using what somebody might be expected to search for on a casual weekend or holiday morning. Neutral Bay and surrounding suburbs have plenty of cafes catering to the brunch crowd so it should be expected to return plenty of hits.

    Yelp

    search results for neutral bay brunch on yelp

    The new contender only found one local result and the rest being on the other side of the Harbour Bridge, including one at Bondi Beach which may as well be in the Upper Amazon to the average Sydney North Shore dweller.

    Interestingly, entering neighbouring suburbs changes the first two or three results to that suburb but the subsequent listings are the same remote locations as for the Neutral Bay query. This might indicate popularity with the current Yelp users or may be part of the package merchants get when they pay for a listing.

    True Local

    a search on true local for brunch in neutral bay

    News Limited’s True Local disappointed one cafe in the district was identified and the number one result was in the city.

    This poor results are probably due to the word “brunch” not appearing in the local cafes’ descriptions or titles, but this is a serious weakness for True Local, particularly in a district where they dominate the local news media.

    Google Places

    brunch local search results for google places

    Surprisingly, Google Places returned an extremely poor result with no local businesses found.

    Again, this is probably due to the failure of business owners to ensure keywords are entered in their business description and it illustrates how Google is allowing an opportunity to pass them by.

    Facebook Places

    Facebook Places results from Neutral Bay brunch searchNothing. Nyet. Zip. No brunch for you.

    Yahoo!7

    yahoo local search results

    Another poor result that has just scraped information off the web. It shows the weakness of the Yahoo! and Channel Seven joint venture which, like News Limited, is letting opportunities pass.

    Bing/NineMSN

    Local search results on NineMSN for Neutral Bay Lunch

    Probably the most disgraceful of the results, NineMSN returned two cafes for the whole of Sydney, a city of four million people.

    The second result entailed, according to Bing’s directions, a 38km drive timed at an optimistic 23 minutes involving $9 in tolls and an illegal u-turn.

    NineMSN’s performance shows just how irrelevant Microsoft has become in the online space and their Australian joint venture partner is more interested in selling big integrated campaigns to advertising agencies.

    Given NineMSN and Bing are the default browser and search engine on nearly two million computers sold in Australia each year, not having a local business strategy is squandering a massive opportunity.

    Citysearch/Sensis

    brunch local search on Citysearch for Neutral Bay

    Founded by Fairfax, Citysearch could have been a great success combining the assets and readership of Fairfax’s metropolitan and local newspapers coupled with their experienced sales teams selling advertising space and subscriptions. Good management could have done this.

    Sadly Fairfax was being run by Professor Fred Hilmer and his army of power suited McKinsey consultants and Citysearch was eventually sold for a pittance to Sensis, who have allowed it to shrivel away as the zero result for our search shows.

    Eatability

    local search on eatability for neutral bay brunch

    Eatability was a genuine surprise, returning no brunch establishments in the area. The only thought is that no cafe in the neighbourhood has the word “brunch” in their keywords. Still a very poor result.

    Urbanspoon

    local search for brunch at neutral bay on urbanspoon

    The web version of Urbanspoon returned the most bizarre result, correctly finding one local cafe but misinterpreting the address as being in Bankstown on the other side of Sydney.

    Urbanspoon’s iPhone app returned a far better range of results in surrounding suburbs although it only found one cafe actually in Neutral Bay which wasn’t the one incorrectly found on their web app, which didn’t appear at all.

    Word of Mouth Online

    word of mouth online local search for brunch in neutral bay

    Word Of Mouth Online delivered the best result of the web pages with two of the first three results being relevant. Of the other seven, they met the criteria of being within a 5km radius of the location which in Sydney can be a 12km drive.

    The results would have been better with more local establishments but it appears the keyword “brunch” hasn’t been used by many of the WOMO reviewers.

    Note: After the review I was contacted by the founder of WOMO, Fiona Adler, it appears some of the reviews have have been updated in the meantime. I’ve changed the results below, but the left the one above as it was correct at the time of the review.

    Foursquare

    neutral bay local brunch search on four square

    Like Yelp, Foursquare relies heavily on users’ contributions and this shows in the flaky, almost useless results for our search terms on a web based search.

    Foursquare’s iPhone app was far more efficient, identifying a range of good venues in the area which were ranked according to friends’ recommendations.

    Sensis/Yellow Pages

    search for brunch on yellow pages for local brunch in neutral bay

    Again, “no brunch for you.” It’s almost scandalous that Yellow Pages has no entries at all for “brunch” for an inner Sydney suburb.

    Redoing the search

    Clearly the term “brunch” is problematic in all the services, so as a check here’s the relevant first page results for other search terms on each of the services;

    Service Café Neutral Bay Breakfast Neutral Bay Lunch Neutral Bay
    Yelp 7/10 2/10 7/10
    True Local 9/30 0/30 0/30
    Google Place 10/10 0/10 10/10
    Yahoo!7 not relevant
    Bing/MSN 3/10 0/10 0/10
    Citysearch 6/10 3/6 4/4
    Eatability 40/50 8/8 23/31
    Urban spoon 3/3 0/0 0/0
    foursquare 3/20 1/20 1/20
    WOMO 8/10 2/10 5/10
    Sensis 7/10 0/10 0/10

    As we found with the earlier search, Yelp was somewhat inconsistent and no doubt the social aspects will see it improve as more users come on board, the results are highly dependent on the terms used by reviewers and this will affect the search results.

    True Local’s score was surprisingly bad, the search for “cafe” found 12 places but three are long closed. “Breakfast” listed B&B accomodation and “lunch” found outlets in the city and Eastern Suburbs.

    Google Places also disappointed on “breakfast”, picking up some B&B establishments along with some city cafes. This is almost certainly due to keywords missing in descriptions.

    Yahoo!7 doesn’t get a rating as all it does is scrape other sites and often refers you to other search services. They are just going through the motions.

    Microsoft and NineMSN’s service again failed dismally; the “cafe” result was poor, “breakfast” looked for B&Bs and “lunch” amazingly didn’t find a thing in Neutral Bay.

    Citysearch’s results for “cafe” found nine places, three of which are long closed which indicates the lack of maintenance their database receives. Encouragingly, Citysearch was one of the best performers for lunch and dinner, albeit only on four and six places found.

    Eatability had by far the most impressive number of results, however a large proportion of the places have closed and are not flagged as such. This probably indicates a lack of maintenance by the owners.

    WOMO was good and like Yelp their results are highly dependent on the words used by reviewers, so key words could be missed simply because reviewers didn’t use them.

    Sensis performed well on “cafes” except that three of the ten listed were closed. The lack of results on “breakfast” and “lunch” is due to no places having those words in their name.

    Conclusions

    This comparison is not scientific, being based on a narrow search and small sample size, but there’s a few things we can take away from the experiment.

    Search is still young

    Right now, search is still a crude tool.

    From the results, we can see that the keywords used by reviewers and businesses matter. If the public are looking for “brunch” and that isn’t on your cafe’s website and online listings, then you won’t appear.

    Over time that will change as the web and search engines get smarter but right now search is still at a basic stage in its development.

    You have to be there

    Customers are using these tools to find what they need and if a business isn’t listed, then they can’t be found. Setting up a profile and getting some favourable reviews is important.

    The business who are being pro-active are the ones who are succeeding.

    There’s a lot of opportunity

    It’s no surprise that older organisations like Fairfax, Sensis and Microsoft are failing to understand local search. What is suprising is how poorly the newer players like Google and Facebook are doing.

    This opens up a lot of opportunity for services like Yelp and Foursquare in adding value to the data already available through services like Google, Facebook and Sensis.

    Yelp’s tie up with Sensis makes a lot of sense from the US company’s point of view; they get to ride on Sensis’ sales team, maybe some licensing fees and – most importantly – they can access the richest, albeit not always accurate, database of Australian businesses.

    For small, local business there’s a lot of opportunity as well. By getting online and registered on these services, it’s possible to become more visible and improve your competitive position.

    The market’s young and there’s a lot of potential for disruptive players. It will be interesting to see how incumbents deal with the threat.

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  • Tony Delroy’s Nightlife: Our digital reputation

    Tony Delroy’s Nightlife: Our digital reputation

    December’s Tony Delroy’s Nightlife looked at the risks of social media sites like Facebook, Twitter and LinkedIn. Along with being a great way to communicate with family, friends and colleagues using online services can have some unexpected effects.

    Program podcast

    A recording of the program is available from the ABC’s Tony Delroy’s Nightlife webpage. You can listen to it through the site or download it and listen to it as a podcast.

    Topics covered

    Tony and Paul covered a range of topics including the following questions;

    • Are we living in the social media age?
    • What is social media is?
    • Why people use social media?
    • How some folk have come unstuck using social websites?
    • Can doing the wrong thing hurt your reputation or career?
    • What the risks are during the christmas party season?
    • Are there too many social media services?
    • How businesses can really use them?
    • Where will these services go next?

    Listeners’ questions

    We had a great range of questions and comments from listeners and those we promised to get back to included how to shut down your Facebook account and the link to report abuse on the service.

    Reporting Facebook abuse

    If you’re being harassed on Facebook, you can report misuse at Facebook’s Help Centre. Their page includes instructions on dobbing in underage users, blocking irritating people and how to use their privacy settings.

    Deleting a Facebook profile

    Leaving Facebook is not easy, so on the Netsmarts website we have the detailed instructions on deleting your Facebook account.

    Note with these instructions that you need to disable any applications you may have installed on Facebook before deleting the account. When you go to the Applications page you may be shocked at how many things are connecting to your page.

    Do we have too many social media services?

    Tony asked if we have too many social media platforms.

    This is a topic we’ve covered previously on the website and while there’s no doubt many of the services around today won’t survive, some will become increasingly become important.

    Next Nightlife tech program

    Our next program will be on February 9 next year. We will probably have some spots over the summer break and we’ll let newsletter subscribers know about them as soon as we do.

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