Seemingly every company in the space seemed to be breaking one of the supposed fundamental, ‘immutable’ laws of marketing as laid out by Ries and Trout’s seminal 22 Immutable Laws of Marketing.

In their book they tout the ‘law of focus’ and ‘the law of line extension’.

In short, the law of focus and the law of line extension say that while there is irresistible pressure to extend the equity of a brand through “line extensions”, that proper branding focuses the brand on one word or word phrase and works to own that (key)word phrase in the prospects mind.

In the face of this logical argument, I’m struck by the myriad of products that each of the successful skin care and beauty lines has produced. L’Oreal, Clarins, Este Lauder, Clarins…basically, all of them. Even the old standby, single product, Vaseline couldn’t resist taking it’s petroleum jelly and extending it into a line of lotions and skin care.

So if it’s such an ill-fated, short term strategy, why is every brand under the sun doing it and getting away with it?

The only reason I can imagine is that it is such a highly fragmented market of bogus claims, smoke, mirrors, and vanity, that it becomes very difficult to get a foothold in the prospects mind, much less beauty counter shelf space. If a store is going to dedicate shelf space to a brand they almost *demand* that the company create more skus so that the consumer will drive the average ticket price up.

I know there are probably more forces at work here that I don’t quite understand, so if you have any insight, sound off! I’ll give you a dofollow link and you too can join the legions of entrepreneurs in the beauty market with more skus than employees!

I’m continually amazed that there are people who are running (sometimes profitable) web properties who can’t tell me what their customer acquisition costs (CAC) are.

As the name implies, this is what it costs for you to acquire a new customer. While any real meaningful analysis would need to include the lifetime (or annual) value of a customer (LVC), we’re saving that for our next post.

So, Why Should I Know my Customer Acquisition Costs?

Once you know what your current CAC is, you can use that to evaluate the validity of new customer acquisition methodologies, campaigns within your existing strategy, or more specific/granular tactics and their effect on this number.

Obviously, when taken with your LVC, it will allow you to determine when a specific strategy or tactic is a bad fit for your market or your current offering within that market.

So, how would one go about calculating their own customer acquisition costs?

This is pretty simple, but it’s (costs of acquiring customers over a given period/customers acquired)

The only ‘art’ in all of this is determining what the total costs were for acquiring customers. Well, like many things this will depend.

Direct advertising costs are obvious, as are the salaries of those that work in a marketing or advertising capacity for your company. In addition marketing materials made to support existing customers (and encourage future business) should be included as well.

Some, more conservative, marketers also included the ‘loaded costs’ or ‘fully loaded’ costs of the marketing personnel. This includes the office space, pcs, phones, admin, medical, parking space, etc. of the salaried marketing execs working with you. Depending on your state and your benefits this usually runs between 1.4 – 1.9X their salaries. You can play with this to see how conservative or aggressive you want to be.

Tune in next week when we discuss, your Lifetime Customer Value!

Leave a comment — It’s dofollow after all!

If you remember, at the time, my blog was a not just a virtual unknown, it was an actual unknown in the virtual world.

While ping-o-matic had alerted Google.com and the other search engines, who were paying attention, to its presence, they were barely giving it passing notice.

To wit: the pagerank was a whopping zero and an alexa rank of 26,374,163, and of course the only comment I had was from a concerned aunt who wanted to wish me luck on my ‘new venture’ — I’m not sure if I’ve ever seen an Alexa rank that high!

Since then I’ve got a google pagerank of 1 on the homepage (yippee skippy),  an Alexa rank in the 6 figures (just barely), and dozens of comments.  Heck, some of the comments were even relevant and topical! It’s certainly nothing to write home about, but we’re about to embark on step two of investigating the power of the dofollow karma wheel.

The DoFollow lists.

I’m going to (attempt to) post my blog on several of the DoFollow lists and see if it gets some more crazy dofollow link-love karma crazed Internet Marketeers to come and leave some topical comments behind which will lead the little search bots back to their own little corner of the Internet.

Heck, maybe even a couple of them will start following the results of this blog and decide to make the dofollow switch (eventually).  I’m guessing all it’ll take is time, patience, love….and results.

It would have made a poignant message to end this post after the first word, but, as the saying goes, “why say in one word, what 500 will say just as well?”

Something that is a common theme for web-marketers, especially when working with smaller, less experienced clients is the concept of “efficiency”.

A new business, or perhaps a small business that grew up without utilizing the web for gathering leads or closing sales, is often nevertheless aware of the traffic they receive to their website, and often acutely aware of a competitor outranking them for a keyword phrase they consider important in google, yahoo, bing, or other search engine.

At this point, most enterprising entrepreneurs will either tackle some rudimentary search engine optimization (seo) or pay per click (ppc) work, or assign someone in the organization to “get them some more traffic”.

Typically, after a steep learning curve involving some link-building, on site seo, or adventures in analytics and adwords, the business owner is very aware of the cost of the project but has yet to see any directly quantifiable gains from the effort expended.

This is often a result of several ‘issues’

1.) an inefficient website

2.) no definitive goals

3.) no systematized tracking in place

An Inefficient Website

By efficiency, I mean the effectiveness at which the website generates your desired result.

If we were to think of the website like a ‘black box’ machine, how good is it at taking the raw input (traffic for instance) and turning it into the desired output?  Examples of the desired output may be lead generation, sales, foot traffic (in a physical store), etc.

The back-ass-wards way of approaching the online marketing problem is to assume that ‘more traffic’ is the answer.  But if you are feeding more and more leads into a system or ’sales funnel’ that has holes in it, your money and effort is usually better spent on fine tuning your conversions (or efficiency) first.

So how efficient is your website?  Without a system for monitoring progress you’ll never know — which leads us to our second point:

Lack of a system for systematized tracking of traffic & conversions

Entrepreneurs are busy.  However simple this one thing seems for those of us who live or die based on traffic, cost of conversions, lifetime value of customer, it can seem amazing.  But, there are plenty of small business websites out there that either don’t have tracking installed, don’t follow it, or don’t know how to analyze the results in a way that benefits their bottom line.

No Definitive Goals

This one *should* be a no-brainer, I guess.  But, I frequently see examples of this with business sites.  They are an electronic representation of a brochure.  There is no call to action (whatever that may be), and even if they are using the site to (theoretically) generate foot traffic, there is no reason for the user to shut off the computer and come into the store.  And, of course, no real good way to track that traffic that came into the physical store after seeing their website

One of the comical things about this post, to me, is the fact that corporateraiter.com exhibits all of these ‘don’t do’s’.  However, this is because I’m not in business yet.  Right now, my site is merely a way for me to share information with friends who need a nudge in the right direction with their own web properties.  Rest assured, when I start pushing prospects to my site, I will have mechanisms in place to capture those leads, and systems in place to monitor my site’s effciency at doing so.

Please keep this post in mind if you are looking for a way to boost your own bottom line!  Tuning up your website’s ability to convert with almost always pay better than paying for more traffic.

I usually stay away from talking about too many tactical details.  They tend to bore or confuse a company’s decision makers and in the game of search engine optimization or seo, the tactics that will work today, often will become outdated, stop working, or worse, counter-productive as the search engines change their algorithms to provide better results to their users.

Although I purposely don’t “seo” my corporate site, I decided to use this site in a controversial, ‘real time’ experiment, and report the results to you here as they happen.

As it so happens, my corporate site is a virtual ‘unknown’.

To whit: In the last week, I’ve gotten four (count ‘em, FOUR) visitors to my site   The site is indexed by google, but it has a pagerank of zero, and an alexa rank of 26,374,163.  In the world of the web, that just North of non-existent.

So, let’s talk about the ‘Test’

It’s ‘common knowledge’ in web circles that you want to get as many incoming links to your site as possible and reduce the amount of “link juice” that flows out of your pages through outgoing links.  This has created a trend towards common blogging software and other content management packages automagically appending all outgoing links with the rel=”nofollow” attribute.

The “nofollow” attribute is an attempt to stop “link juice” from being passed where you don’t want it passed.  Savvy web developers and Internet marketers attempt to “shape” their link weight by external and internal linking schemes designed to increase the weight of a given page.

I am going to fly in the face of convention and make this site’s blog postings accept comments with followable links.  In other words, outgoing links in comments that pass link juice out.

While more knowledgable search marketers will tell you that even outgoing links on a page will help with relevance and theming, the challenge here will obviously be trying to carve and theme the links when it’s a veritable free for all.

By doing this, I”ve joined the nascient DoFollow link-love community.

In executing this ‘test’ we’ll be watching my traffic flow, alexa rank (which has some flaws as the sample is skewed) and my pagerank (which is a dreadfully lagging indicator).

Now, of course, this isn’t a great “test”.  The reason is, of course, I’ve got no ‘Control’.  Well designed testing would have a control of sorts.  The reason is, the mere fact that I am creating a post to report on the ‘results’ will effect the results to some degree.

However, I’m too lazy at this stage to create a side-by-side example of www.corporateraiter.com with the same word-count, incoming link count & quality, and posting schedule.  I’d need to take great pains to have identical keyword counts and avoid duplicate content between the two sites.  Not to mention, one site would have a greater URL age, etc.

All that considered, I will run the ‘test’ and be reporting on the results here, including any frustrations or impossiblities that arise out of telling the world that this is the comment spammer’s version of nirvana.

I hope my experiences will help some others decide whether accepting outgoing links on their comments and joining the DoFollow revolution is right for them.

The reason is, it’s at the core of everything your business does.  Put simply, if you have a good, well defined value proposition, everything else will come easily.  If you don’t, well, you’ll that your efforts are constantly being held back by an invisible, yet perceptible, ‘headwind”.

So, what is a ‘value proposition’?

Simply put, it helps to answer the following question in the prospects mind: “Why should I buy from you, and not your competition?”

In a lot of cases we see, even if a business intuitively “knows” their own value proposition, they’ve done a poor job of defining it for the prospect, and an even worse job of articulating it.  If the prospect doesn’t instantly ‘get it’, the chances of converting the prospect into a sale diminish significantly.

So what are the characteristics of a well articulated value propostion?

Appeals to a relevant and intense problem instantly

While to most this should be self evident, while raising money for small entrepreneurial companies in silicon valley, I can’t tell you how many times some very smart people were spending time building “better mousetraps” without a clear idea of customer in mind.

We used to call these, “solutions in search of a problem”.

While it’s true that occasionally these turn into products, this is an example of marketing “into the wind”.

Instantly communicates that you understand the problem and you have the solution

Ideally, through your value proposition, and the material that supports it, your prospect can see that you understand his problem.  Marketers call this ‘empathy’.  One very common technique is in a personal appeal that should look very familiar.  It goes something like, “I used to be just like you….”

The reason this advertising cliche looks so familiar is because variations of it continue to work to this day.

The second part is that you have the solution to their problem.  The cliche continues, “then I started drinking super magic muscle builder x” (or whatever).

Ideally, it quickly becomes clear that not only do you empathize with their problem, but you are offering the magic bullet that will make their pain go away.

Translate that solution into an obvious and immediate benefit to the customer

There are times that this can be inferred or is obvious.  There are many other  times when it’s desirable or necessary to spell it out for the prospect.

Some other guidelines for a well articulated value proposition

Quantifiable

Third party verified

idea or concept is not already owned in the customer’s mind by another competitor