February 2000 vol2 What's the Buzz? 'PRESENCE AWARENESS:' INTERNET MARKETING'S NEW NEW THING "Presence awareness," the ability to know a person's availability and status across all communication channels, is a developing technology that will soon be another tool for Internet marketing, according to a recent report from Forrester research. The report, titled "Meet Presence Awareness--IM's Alter Ego," describes presence awareness as an electronic peripheral vision that will be embedded in e-commerce and business applications. Among other things, it will help marketers build customer loyalty. Like America Online's Instant Messaging and buddy lists, presence awareness software helps users find other people online. But as Forrester conceives of it, presence awareness includes other applications. An email system with presence awareness, for example, would indicate which message recipients are currently online. Besides Internet browsers and email systems, presence awareness technology could also indicate who's available by phone. Presence awareness systems would let users control their availability profiles, Forrester says. A traveling sales rep, for example, would let colleagues know that she is on the road, but reveal the hotel phone number only to her boss. In this and other applications, presence awareness would help colleagues and customers decide how best to contact her: via Web-conference, instant message, or email. 'SUPERCHARGED E-COMMERCE' For marketers, presence awareness that is context-based "supercharges e-commerce," Forrester says. For example, Web surfers can meet and interact while browsing the same site. Or a financial service website could offer a live link to a customer's financial consultant and display the likely wait time. It could also be used as a preemptive customer service tool to assist confused online shoppers, according to Forrester. CURRENT, FUTURE PLAYERS Lotus' Sametime product has presence awareness features that will be integrated into its product offerings this year, Forresters says. But Lotus should partner with a portal to bring its presence awareness technology to the consumer e-commerce market, according to the research company. Microsoft, on the other hand, plans to deliver presence awareness technology in Exchange 2000, which won't become widespread until next year. Forrester says Microsoft should instead build on its investment in CMGI by tapping that company's Activerse's Ding!, a scalable presence awareness server, and Tribal Voice's PowWow, an instant messaging product. Forrester recommends that AOL offer its instant message technology to Sun-Netscape to build presence awareness into Netscape's Directory Server. TODAY'S PROBLEMS Thankfully for Internet marketers, presence awareness is far enough down the road not to demand their immediate attention. A more pressing challenge is marketing to the burgeoning minority communities on the Web--described as "one of the largest growth markets online." Find out just how fast minority Internet use is growing and how to reach them in "Match Your Marketing to the Multicultural Web." And one of the most cost-efficient Internet marketing tools--permission email marketing-- comes in many flavors. Reacquaint yourself with all the different varieties of permission email marketing, as well as their benefits and resource demands, by reading "Consider All Your Email Options." BANNER AD RATES FALL 4% IN 1999 Average cost-per-thousand (CPM) impression rates for banner ads fell 4% last year, according to the 1999 Online Advertising Report Year in Review from AdKnowledge, a Web marketing management company. CPMs have fallen 14% since the beginning of 1997, AdKnowledge says. While CPMs were falling, booming e-commerce has lead more websites to seek advertising, AdKnowledge says. At the end of 1999, there were 3,347 ad-seeking websites, a 135% increase from 1998. Since the beginning of 1997, the number of websites seeking ads has grown 306%. The number of sites accepting rich-media ads also jumped last year, with all formats seeing double-digit or triple-digit growth for the year "Match Your Marketing To The Multicultural Web Increasingly, the Internet is a multifaceted marketplace, made up of users from multiple cultures. These multiple cultures warrant different marketing approaches, something marketers often overlook. To tap the potential of the various cultures shopping on the Internet, marketers must adapt their efforts to the ways different minorities make online purchase decisions. Thirty-one percent of the total U.S. adult ethnic minority population is online, with more joining daily. African-American adults are the largest minority group online, accounting for 36% of minorities online, followed by Hispanics, 24%; and Asians, 10%. These groups are "logging on like never before, looking for a way to become part of the information age," says Dean Gebert, senior marketing manager at Internet service provider MindSpring/EarthLink. "It is no longer a matter of marketing to the masses, then sitting back and reaping the benefits. Affinity niche marketing is the word of the day." DIFFERENT ACCESS PATTERNS How minority groups access the Internet differs from how whites access the Internet. "Nonwhite users have a significantly higher likelihood of accessing the Internet from academic locations," says Idil Cakim, an analyst at the online research company Cyber Dialogue. "Nonwhites are also more likely to share online access with co-workers (16%) than are whites (10%)." Income affects how minorities access the Internet. "Minorities with incomes of $50,000 or higher are almost as likely to go online from home as whites--53% vs. 63%," Cakim says. SPENDING, CLICKING BEHAVIOR Research shows that minority groups have distinct online spending tendencies. African Americans are "intensive Internet music shoppers, where they are more likely than the general online population to make purchases," according to Cyber Dialogue. Online minority users are also more willing to click. Compared to whites, minorities are "less likely to feel that Internet ads interfere with their online experience: 24% vs. 37%," according to Cakim. "Their openness to explore the Internet is also evident in their propensity to click on online advertisements, which runs nearly twice that of white surfers," she says. Nonwhites average 41 clicks per month vs. 24 clicks for white. SITES START PAYING ATTENTION Internet media outlets are beginning to focus more on matching content, incentives and products to different ethnic groups so that marketers see better results. "Ethnic groups present one of the largest growth markets online, possibly only second to business-to-business and the youth market," says Randy Schwartz, director of media for online advertising agency IN2. "Ad-sales networks and content sites have become increasingly committed to enabling advertisers to target such a diverse market at the niche level, at which point the marketer's job is to uncover the best incentives and appeals per group, to drive their clients' acquisition efforts," he says. For example, America Online, StarMedia and Terra Network have all developed niche-targeted content for the Spanish-speaking markets. MARKETING TO MINORITIES Internet marketers can use information on minorities' online access, surfing and shopping habits to hone their customer acquisition strategies. Marketers can also work with media outlets that understand the importance of culture-specific strategies. "Do the research to find unique places that have statistics to prove that they are attractive to a growing group of minorities," says Mindspring's Gebert. "They probably aren't the largest, most popular sites on the Internet. As a matter of fact, they're probably quite obscure and will take some digging on your part." But the minority population on the Internet is curious and ready to spend. Paying attention to market trends among minority groups will increase advertising effectiveness and, more importantly, results. By John Davis John Davis is senior writer at Idea Station, an email marketing agency specializing in creating and managing quality email newsletters for clients in various industries. Consider All Your Email Options Have you considered all the ways permission email can help you meet your marketing goals? A recent report, "Permission Email: The Future of Direct Marketing," identifies eight "distinct and proven models of permission email marketing that can help marketers understand and codify the best approaches to permission email marketing programs." This article is an excerpt from that study, which was prepared by IMT Strategies. The eight models fall into two categories, determined by whether the marketer's primary objective is to retain customer relationships or acquire new customers. Each model has specific strategic implications, resource requirements, costs and response functions. USING PERMISSION EMAIL TO RETAIN CUSTOMERS These first three permission email marketing models are designed to let marketers up-sell to existing customers and convert existing prospects to first-time customers. Customer Relationship Email This is the most broadly defined model of permission email marketing, and perhaps the most widely practiced. In the CRE model, a company invites its Web visitors (existing customers and new prospects) to submit their email address in order to receive occasional announcements and promotional offers. While it sounds straightforward, the strategy involves many variables that affect response rates, including type and quality of offer, frequency, message formatting, subject lines, copy writing and more. Corporate Newsletter Corporate email newsletters differ from customer relationship email in that they follow a regular schedule and have some kind of editorial content. Many of these are "news you can use" advice columns related to the company's industry or product offerings, while others may be more focused on "news about our company" to highlight, for example, customer service tips or community outreach/philanthropic pursuits. Reminder Service Reminder services are calendar services that let consumers sign up to be reminded or alerted to special dates. For example, e-commerce sites frequently offer gift reminders for anniversaries and loved-ones' birth dates. A variation, the replenishment service, enables a company to remind customers when, for example, the printer toner cartridge they bought six months earlier will likely need replacing. USING PERMISSION EMAIL TO ACQUIRE CUSTOMERS The following five permission models are appropriate for companies seeking to acquire new customers through email without spamming. Permission List Marketing Companies seeking to target a large number of new prospects can pay to access the subscribers of permission list managers. These services play an intermediary role between customers and marketers. Customers--consumers and professional users--are invited to register with the service and, ideally, choose from among a number of categories about which they would like to receive commercial announcements. The service then sells access to those consumers to marketers. List managers do not release the email addresses of their subscribers to the marketers. Rather, the marketer supplies the message to the list manager, who relays it to the service's subscribers on the marketer's behalf. Permission list marketing services range from those that are highly concerned with customer empowerment and privacy protection to others that push into the gray area where permission approaches spam, depending on the strength of their opt-in, unsubscribe and advertiser access policies. Sponsored Newsletter Thousand of independent writers have found email to be a simple but effective means of self-publishing. Millions of readers have subscribed. Increasingly, many large Web and print publishers, such as the Industry Standard, Wired or MSNBC, offer email digests and newsletters of their own. The majority of these publishers accept advertisements. While most email newsletters have relatively small circulations compared to traditional publishing, some have hundreds of thousands, and others have over a million subscribers. One main benefit of this low-tech advertising approach is the ability to reach niche audience segments, both among consumers and business-to-business. Sponsored Discussion List For more than a decade, email has also been a popular platform for cyber discussion communities. The directory "Liszt" catalogues more than 90,000 email discussion lists devoted to every topic imaginable. Every subscriber to the list receives a copy of every message posted. Many such lists have thousands of members, who can generate 10 or more messages per day. Although advertising sponsorship is not the norm for most such lists, increasingly some business-to-business oriented communities as well as consumer ones are accepting advertising, typically in the form of sponsorship for a week or more, featuring a brief commercial message at the top or bottom of every post message. Advocacy Marketing Advocacy marketing is more a strategy than an advertising opportunity. Often referred to by the unfortunate jargon "viral marketing," this technique enlists a company's existing customers to work as its evangelists, spreading the word among their friends. This type of "friends get a friend" strategy is well known to traditional marketers, but the concept has taken off explosively on the Internet, where some firms have achieved wild-fire growth by well-orchestrated, virtual word-of-mouth promotion. The free Web-based email service HotMail is a classic example, quickly attracting millions of users with minimal marketing budget by appending a promotion for HotMail at the bottom of every message sent by HotMail users. Other companies have had success motivating their users with rewards to recruit their friends. Partner Co-marketing In the world of traditional direct mail marketing, it is common for companies to rent or sell access to their customers' names and addresses to other marketers. In the new world of email marketing, however, a company acquiring addresses outright from any source usually constitutes spam. Therefore, many permission-savvy email marketers compromise by having one company send a message to its own subscribers on behalf of a partner company. For example, Lands' End might send a message to the effect of, "Dear Lands' End Customer, to thank you for your loyalty, we would like to let you know about a special offer from our corporate partner, Sharper Image." The study that this article is excerpted from, "Permission Email: The Future of Direct Marketing," also covers topics such as the best practices of permission email marketing and the future challenges for permission email marketers. To receive a free copy of the study, send a request to amyb@yesmail.com. INTERNET LEADERS BACK COMPREHENSIVE STUDY OF EUROPEAN INTERNET USE Nine leading Internet content and marketing companies are backing a comprehensive study of Internet use in 14 countries. The study of 150,000 Internet users in 14 countries will be conducted in February and September by Pro Active International. It will report on Internet penetration, demographics, psychographics, Internet and other media behavior, e-commerce behavior, and attitudes toward online advertising, according to Pro Active International. It will include online surveys, telephone surveys and in-person interviews. "International Internet marketers will finally have reliable benchmark and trend information about the growth of the Internet in Europe and about European Internet users," says Liesbeth Hop, Director and founder of Pro Active International. "This data helps marketers to define their online strategies for the European marketplace." The study results will be available in May. The sponsoring companies are AltaVista, RealMedia, Yahoo! Europe, MSN, 24/7 Europe, Excite, Ad Pepper, DoubleClick and Active Advertising. These companies are financing the study, serving on the study's advisory board, and recruiting study participants." Global Marketing Can't Be Done Just In English As the world becomes smaller due to communication and transportation advancements, few U.S. manufacturing and service companies are not looking for business beyond their borders. The Internet makes it easier to capitalize on these opportunities, but reaching and communicating to prospects in other countries presents new challenges. If your firm is a manufacturer, have you ever turned down an export order because it required your training or maintenance manual to be in another language? Technology available from U.S. manufacturers is in demand in many smaller or less developed countries. With the Internet, you are reaching these buyers, so why not sell to them? Regardless of the product or service you market, do you need to translate your website into another language if you want to get foreign sales? Consider the question this way: Would you buy from a website that wasn't in English? Although many educated people around the world have some knowledge of English, certainly their preference is to read in their native tongue--especially when making a buying decision. And if you're actively targeting people from another culture, why not offer your site in all of your customers' native languages? Of course, deciding that you need language translation services is one thing, but selecting a company to do the work is quite another. Make sure the company's offerings match your needs. For example, some firms may only translate into one or two languages. Do you need four, five or more? Also keep in mind the dialects you need your website translated into. French in France is much different than French in Canada (where by law everything from maintenance manuals to consumer labeling must be bilingual). Spanish in Spain has major differences from Spanish in Mexico. And the same is true for Spanish in Central and South America. The major search engines will help you find translation companies, whether you do a general search for "language translation," or a specific search, such as "Spanish language translation." But the companies you uncover will range from major translation firms to college students working out of their dorms. Search engines may also point you to websites offering free translation using automated software. In this case, you get what you pay for. Your translation may miss the finer points of the language, and your readers will get a good laugh from the mistranslations. In business, you cannot afford to have mistakes in your information. Depending on your website, you may also need a translation company that knows your industry. A translator that has a graduate degree in linguistics may not have a clue about translating technical Web pages that require in-depth knowledge of electrical or mechanical engineering. And a legal document shouldn't be handled by an advertising specialist. Taken together, these factors may add up to a long list of selection criteria. Here are some guidelines: SAFETY IN NUMBERS If you go to a translation firm that has only one translator, who will edit his work? Use translation firms that offer both translators and supervisory editing of the work. MEETS ALL YOUR NEEDS If you have more than one language to translate to, find a firm that can do all your work. That way, one contact is responsible for all of the assignments. It saves time, money and ensures consistency. NATIVE SPEAKERS Ask if the firm has native language translators for both your target language and geographic region. Remember, Castilian Spanish will either be a joke or unreadable in Mexico. LEAD TIME How much lead time will the translation company need? If you have a 500-page website to be translated into six languages, it isn't going to happen overnight. However, a letter or document usually can be. A small firm that is busy with a large project may deliver your Web pages months later than a larger firm with multiple resources. Many larger translation firms have resources around the world, both to ensure native language translators, as well as to help with large projects. Such larger firms may be able to manage larger projects better. REFORMATTING INCLUDED? Make sure your price quote includes reformatting the pages to match the original submission. This usually doesn't matter for letters or legal documents. But if you are translating a website, advertisement, manual, catalog or marketing brochure, and if your translation firm doesn't offer reformatting, you will probably need to hire an advertising agency. This can be both expensive and error prone, because word and paragraph separations can be confusing to anyone not familiar with the language. WEIGH COSTS, RETURNS Like any business decision, consider the cost versus the return on the investment. Excellent, error-free translations, using industry knowledgeable, native language translators, will cost anywhere from less than $100 for a simple document to well over $100,000 for a complex website or large catalog or manual. Be sure to get quotations first. Make sure it includes all you need, such as editing and reformatting. Then weigh the potential rewards against the cost. MAKE IT FIRM Insist on a "firm" price quote. Many translation services only provide estimates of total project costs. It's easy for a translation company to get a precise word count to base quotes on, so if a translation firm cannot guarantee its pricing, keep looking. Few businesses can ignore the importance of worldwide commerce. Companies that address worldwide commerce opportunities the best will reap the rewards. Business history has shown that the first to market receives the best profit margins and the greatest sales volume. Those last to enter the market receive the opposite. Are you sure you want to wait until later? By Jim Wanek Jim Wanek is president of 4Translation Inc., an online language translation company that offers instant, free quotations at http://www.4translation.com. Contact Wanek at jwanek@4translation.com