Welcome to Issue Nineteen of the Competitive Edge Newsletter.
Issue 19 of Competitive Edge looks at two different issues.
We’ll begin by taking a look at what a recession can mean for companies selling software online, how it can affect your competition, what opportunities lie waiting to be tapped into, and how to not only survive a recession, but possibly even thrive on it.
Secondly, our in-house tracking expert, Aaron Weiner, will be shedding some light on Google’s conversion tracking system; it’s strengths, flaws, opportunities and weaknesses. He’ll also be showing you how to use their system for tracking your downloads.
Be seen, be strong, be sold.
Dave Collins
SoftwarePromotions
http://www.SoftwarePromotions.com
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The Recession has officially begun. What are you going to do about it?
Many companies are starting to feel the effects of the recession, and no-one can hope to remain immune. As dismal as it sounds, it’s going to get a lot worse before it starts getting better.
The Google AdWords Landscape is about to change.
The past few years have seen Google increasingly allow advertisers to pay their way to the top; a PPC version of brawn winning over brains.
The recession will change that. Competition who were happy to blindly throw money into their AdWords accounts will soon find that inefficiency is no longer an option.
Companies with the skills, knowledge and expertise to effectively manage an AdWords account stand a far better chance of not only surviving but prospering.
With more than ten years experience, our AdWords Qualified Company will improve and expand your account. We have three qualified and certified AdWords professional who will help you stop wasting money.
We bring more targeted traffic at a lower cost. More for less.
Let us turn your account around. Find out how we can help you beat the recession today. Ask Dave about the Beat The Recession Discount.
Google AdWords Management Service
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Recession – threat or opportunity?
Even the most fervent of optimists now have to accept the reality: that irrespective of how precisely to define a recession, we’re either in one or about to be. Here in the UK we’re officially in recession, and there’s even been talk of a depression. The news and media are full of gloomy forecasts and dire predictions, but for once, they are mostly in agreement: The economic situation is bad, and it’s going to get a lot worse before we can even begin hoping for some sort of recovery.
Many individuals and businesses have had their heads in the sand for too long, but even the most firmly in denial have had to come up for air, and what they’re seeing isn’t pretty. Some are in a state of moderate to advanced panic, believing that their businesses, plans, and way of life are finished forever. Others believe that the media’s grasp of reality has taken the concept of exaggeration to previously unimaginable heights. The truth, as is often the case, lies somewhere between the two.
Those hoping that a recession isn’t a serious threat or problem are likely to be disappointed. There are an apparently endless number of analogies being used, but my favourite compares a recession with a violent storm. Those caught up in one will undoubtedly sustain damage, but the extent of their suffering may range from inconvenience to life-changing disaster. It depends on where you are located, how long the storm takes to pass, how vulnerable you are to its effects and how much you have to lose. The analogy is a good one, as aside from planning and basic prevention, it often feels as though there are raging elements that lie beyond your control.
However, it’s not all doom and gloom, and there is much that can be done to not only ride-out the recession, but possibly even gain from it.
In spite of all the obvious negative consequences of a recession, it can also be a good time to expand and develop your business, as many of your competition will probably be doing the complete opposite. In spite of the apparent panicking, consumers and businesses do not completely stop looking for solutions to their problems, but they might begin looking for better value. If your product or service offers that, then this particular recession-fuelled demand could turn into your opportunity.
The same idea might also apply to existing customers and users. A smaller version of what you usually sell could be of interest, as could a cheaper and/or more basic version.
But why limit your outlook only to existing markets? You may have to go looking for them, but other markets are out there. Older people, for example, tend to be less affected by recessions, as their mortgages and debts have usually been paid, and they are not typically dependant on salary for their income. If there’s a way to tap into these users, now would be a good time to do so.
A recession can also offer opportunities for businesses to expand their market share, and those with the courage and foresight to increase their marketing budgets can gain in the long term. When a company’s income shows signs of falling, the knee-jerk reaction is to cut back on spending. And all too often, the marketing budget is one of the first to go. This is undoubtedly a mistake.
When the number of people coming into your shop starts to fall, boarding up the windows and turning out the lights is a really bad idea.
And while we’re thinking positively, let’s not forget that a recession can also give all businesses a shake-up. While this might be painful, it can also produce greater flexibility, better spending habits and improved creativity in the long run.
But let’s be realistic here. If you go to the Doctor for an inoculation and spend three days shivering in bed while your body builds up resistance, you’re going to feel bad for those three days. But remembering that there’s light at the end of the tunnel can help ride out the short-term discomfort.
And don’t overlook the obvious – your business not only generates revenue but spends as well. Many businesses are slashing their prices in a desperate attempt to increase their income, resulting in some very good deals for software, products, hardware, services and more. Don’t make the mistake of stopping all spending as the economic situation worsens. Spend cautiously, choose more wisely and enjoy the savings that are out there.
It’s also a good time to invest in your existing supporters. The importance of retaining their loyalty during these times is paramount, and a little goodwill right now could pay off in the future. You already know that acquiring new customers is more costly than keeping existing users happy, but are you making sufficient efforts to reassure and impress them now, while the going’s still good?
And do not, under any circumstances, abandon plans for new products and services at this time. You might want to put a little recession/savings orientated spin on them, but for many goods and services, new offerings are just as likely to be popular now as a year or two ago. Sales might be slower to come in, but getting the word out and establishing a reputation doesn’t happen overnight.
So enough theory and reassurance. What should you be doing to ensure that you not only survive the recession but possibly even gain from it?
Start from your base – your customers. Now is the time to really understand who they are, where they come from and how they may be affected by the recession. Now is the time to start communicating with them on a regular basis. And now is the time to identify their needs, and start tapping into them. Many small businesses often adopt a fairly lax approach to invoicing their clients. Aside from the fact that this is a bad business practice, this is precisely the sort of problem you want to avoid during these times. If you allow your customer’s inefficiency or inability to pay on time to run rife, your own business could well run into cash flow problems. It’s a problem that can be very difficult to repair, but is easily avoided.
Encouraging customers to pay on time doesn’t need to involve threats or harassment. But invoices should include clear payment terms, and customers should understand that failure to pay on time will result in additional charges. They expect this from most of their other suppliers, so why should you be any different? Bear in mind, however, that there’s no need to be heavy handed. The last thing you want is to drive away a long-term customer. Get the balance right.
The next step should be to consider all and any possible expansion. New products or services, new licensing, different pricing models – but while we’re on the subject of pricing, don’t simply lower prices to try and increase sales volume. It’s far too basic a strategy, and as well as risking a drop in revenue can also cheapen your company’s image and make you look desperate. During a recession, customers need more reassurance, so don’t force prospects to question whether you’ll be around in a few months time.
And despite my constant urges not to slash marketing budgets and not to stop spending, it’s a prudent time to cut back where it makes sense. A little time spent on research can find savings in cheaper phone calls and utilities, for example, and for some companies, cutting down on unnecessary travel could also be a good opportunity to save. All of which should have been done before the financial crisis, but better late than never as the saying goes.
But as the other saying goes, don’t throw the baby out with the bathwater! Saving a few dollars each month by switching to a cheaper internet service provider may prove to be a false economy if your new connection is slow and unreliable. Cut down on unnecessary expenditure, but don’t cut corners.
Cash flow is also of importance. Despite the fact that many small companies think that such ideas only apply to the bigger businesses, cash flow could well prove to be the difference between a business surviving or dying. Tapping into the skills of your accountant or even using software such as QuickBooks make this information instantly available. Keeping an eye on cash flow is quick, easy to plan around and potentially lifesaving.
If you do foresee short-term cash flow problems, don’t be afraid of taking whatever measures are required. Even if your business has been self-supporting from the start, borrowing money to fund necessary expansion makes a lot more sense than not allowing a worthwhile project to get off the ground.
Finally, a note of caution. No-one knows how long the current recession is going to last, nor how our businesses are going to be affected over the coming months. Yet even if your business is doing well or even thriving right now, a lot of change lies ahead. Most new initiatives take time to put together and implement, so now is the time to look around, consider what options are available and start putting ideas into place.
Be seen, be strong, be sold.
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Conversion tracking made simple
Whether you’re a novice or veteran Google AdWords user, the most important AdWords issue is your return on investment. Tracking the success of your AdWords traffic is critical, and this article will show you how to use Google’s conversion tracking and make it work for you.
For the majority of AdWords users, your ads are attempting to drive visitors to your website, in order for them to perform some kind of action, such as signing up for a newsletter, purchasing a product or downloading your software. By default, Google provide you with a very limited amount of data, covering only the basics such as how many people clicked on your ads and how many people searched for your keywords. The problem with this information is that it only tells you one side of the story. What happens once those people arrive on your website? Do they return to Google within a few seconds, or do they continue through your website, ultimately performing the action that you want them to take?
A few years ago, Google introduced a means of tracking how well your ads, keywords, ad groups and campaigns are performing from the perspective of their advertisers. The tool can be found within the AdWords account under the Campaign Management tab labeled “Conversion Tracking”.
Implementing basic conversion tracking is fairly simple, but setting it up correctly is vital to accurately track an AdWords campaign. However the system itself is far from comprehensive, and it’s important to understand its limitations.
Consider the following example. A company sells software through their website, offering a downloadable trial version that works for 30 days, after which the user must either purchase or remove the software from their system. The company wishes to know whether their AdWords budget is being well spent, and how much each sale actually costs them.
Google’s conversion tracking works by placing a piece of code on a particular page of the website. Visitors clicking on AdWords ads are considered conversions if they land on this page, so the placement of this code is vital. If the code were placed on the landing page of the AdWords ads, every click would be considered a conversion.
If you look at the user’s progress as a journey, the starting point is the AdWords ad, and the ultimate goal is the “thank you for purchasing” page. If the visitor clicks on the ad and eventually lands on the final page, whether a “thank-you” or order confirmation page, that would be considered a conversion.
Google’s conversion tracking uses a cookie that only lasts for 30 days. There are a number of issues that need to be considered with this form of tracking.
- Are your visitors likely to accept cookies or keep them? There are many tools that limit or even erase cookies, and if the cookies is removed, tracking cannot occur.
- The expiration of Google’s cookie must be considered. If the software is purchased more than 30 days after the ad is clicked, the conversion would not be tracked.
- The person who clicked on the AdWords ad might not be responsible for purchasing. This can often occur with business purchases. If so, the conversion would not be tracked.
- If one PC is used to click on the ad, and another to purchase, the conversion would not be tracked.
Taking these limitations into consideration, Google’s conversion tracking offers a less-than-perfect solution, but if setup correctly, can still be used to your advantage. Our own experience has been that tracking immediate actions, events that occur while the visitor is on your website, work best with Google’s conversion tracking. It is far more difficult to track a conversion once the visitor leaves your website. Will they come back within 30 days? Are they using the same computer if they arrived back on your website? Did they close their web browser and clear their cookies?
Going back to our example of the software company, most advertisers will want to know how many people clicked on their AdWords ads and ultimately purchased their software. Those advertisers will most likely setup conversion tracking for purchases, placing the Google conversion tracking code on the final page of the shopping cart.
The problem is that they might not see as many recorded conversions because of the issues outlined. This is why it is a good idea to also track the number of downloads as well. It is more likely that a person who has clicked on the AdWords ad will download the software, as opposed to purchasing it without trying it. Also, downloading is a more immediate action, often without leaving and coming back to the website.
In the past, Google’s conversion tracking was limited to one type of conversion. However, this has been improved, and you can now track up to thirty different types of actions and goals. So there is no longer any reason to limit yourself to only sales conversion tracking. If you have a newsletter, you can track subscriptions. If you offer different types of downloads, you can track each one separately. The more data you have to work with, the better chance you have at running a successful AdWords account.
However there still may be issues with tracking the number of downloads. As already mentioned, Google’s conversion tracking works by placing a piece of code on a goal web page. However, downloads are actual files, not web pages. As SoftwarePromotions works with a lot of software companies, we have found two methods of tracking downloads.
- The Google conversion tracking code is place on the page where the download is offered.
- If someone clicks on a download link, the download is delivered, and the visitor is sent to a page where the Google conversion tracking code has been placed. Similar to the first method, however the visitor must click on the download link in order to be tracked.
Each of the above methods have advantages and disadvantages.
For the first method, placing the tracking code on the download page might not be accurate, as you cannot be sure whether the visitor simply visits the page or actually downloads the software.
The second method makes use of a JavaScript “onclick” event which would trigger the following code. This code would be placed in the <head> of the web page:
<script language="JavaScript" type="text/javascript">
<!--
function handleClick() {
setTimeout('window.location.href = "http://www.yourdomain.com/thank-you-for-downloading.html"', 4000);
}
//-->
</script>
The links to the downloadable demos would be set up as follows to activate the above code:
<a href="http://www.yourdomain.com/your-download-demo.exe" onclick="handleClick();">My Downloadable Demo</a>
You would then place the conversion tracking code on the “thank-you-for-downloading.html” page. There is a good example of this technique in action at www.tudumo.com.
This method, however, also has limitations. If the visitor has Javascript disabled, they would be able to download your software, yet the page with the tracking code would never be hit.
When setup correctly, Google’s conversion tracking can provide you with extremely useful data, and each AdWords click will have far more meaning when matched up with the conversion data. You might even find that some (or even all) of your keywords or ads that you once thought of as top performing, actually amount to worthless, costly traffic.
Be seen, be measured, be sold.
The Competitive Edge newsletter is a monthly in-depth look at the issues faced by independent software developers today.
If you’d like to comment on any of the information within the newsletter, please email Dave Collins directly atdave@softwarepromotions.com.
Common Sense Disclaimer: The advice, views, experiences, opinions and other information shared in the Competitive Edge newsletter are researched to the best of our ability. At the time of publication, we believe them to be correct.
SoftwarePromotions can not and will not guarantee that any of the information here is accurate, and/or will work for your company. In plain English, use this information at your own risk.
All information herein is offered “as is” and without warranty of any kind.
To the greatest extent allowed by law, SoftwarePromotions, nor its employees nor contributors, are not responsible for any loss, injury, or damage, direct or consequential, resulting from your choosing to use any of the information and/or advice presented here.
SoftwarePromotions
http://www.SoftwarePromotions.com