Bradley Howard's Blog

Using Groupon and Quidco at Christmas

Dec 6, 2011 at 1:33pm

With so much industry news reported about Groupon, I was asked recently asked for my views on the Internet shopping/ deal site.

Firstly, I have been using a favourite deals site, Quidco, for several years, and this year Mrs H and I have done most of our Holiday shopping using the site, and earned a very nice cashback amount from the site. Quidco has a simple model - it uses the affiliate bounty that is a standard model across the Internet, and gives most of the money back to the end consumer (me) after taking £5 for the year.

There are hundreds, maybe thousands of deals and voucher sites on the Internet. If you type in your favourite retailer followed by the word ‘voucher’ into Google, you’ll find an amazing number. Now click on them and chances are you’ll be presented with tens of expired vouchers. With voucher sites, it’s a case of quantity over quality.

Groupon has just turned three years old. It’s model is to offer a limited number of products and sell them to the first consumers who buy those products. After the ‘inventory’ has been sold, the offer is removed from the site.

Deals discounts are usually in the 50-75% discount range. Its the retailer who offers the deals to Groupon, and Groupon takes a further commission in the product.

One of the issues that Groupon is facing is that not all retailers believe the deals are worth that level of discount. When Groupon started business three years ago, the aim was that buy generating a loss-leading sale, the consumer would like the service/ product so much that they would revisit the retailer later.

There are many flaws to Groupon’s business:

It’s a highly competitive market that is very easy to imitate, as demonstrated above
Retailers don’t really want to be part of Groupon’s world because the discounts are huge, and the commission to Groupon is a high part of the remaining amount (i.e. what the consumer will spend)

In November, Groupon turned three years old. It is now in 45 countries. It IPOd last month at $19 per share. A fortnight after floating the stock had halved in value, and is now back to $18.

Groupon’s Q3 2011 revenue was an impressive $430m. It hasn’t achieved a financial year in profit, although Q1-Q3 2011 it has made $22m profit.

In Q3 2011 it made $8m - an unimpressive 1.86% profit. Groupon has a market capitalisation of $12bn. It’s actually quite amusing to go to Google Finance and look at other NASDAQ companies that have a capitalisation less than Groupon, yet earn a good profit.

I don’t see how Groupon’s business is sustainable because of the flaws, and I think we’ll see a trend of ‘lower value’ retailers on the site, which will mean less visitors come to the site and destroying its business model.

In summary, if you’re looking for bargains this Christmas, take a look at Groupon for some ideas. If you are looking to simply have some cashback without any fuss, I highly recommend Quidco. And if you're looking for an investment opportunity, you should look a little deeper.

Photo courtesy of 401K on Flickr

tags:

High Street, affiliate, ecommerce, investment, trends, web traffic,

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How I would Yahoo!

Oct 26, 2011 at 8:43am

So, apparently Yahoo! is up for sale, and even better, Google are willing to help fund it's resurgence. This sounds so familiar – in 1997, Apple were having serious problems and Microsoft, their once main competitor, invested $150 million in the company, and now Apple is worth more than Microsoft!

Back to Yahoo!, it’s amazing how many people are so dismissive of Yahoo!’s (that’s a lot of punctuation) value.

Here are the high level stats:

Yahoo has over 500 million unique visitors each month, around the World, in over 30 languages.

In the UK alone, adults spend over 3 hours a month just on Yahoo! Mail.

To build that audience of 500 million would cost a HUGE amount of money (and time), so in my opinion there's never been a better time to Yahoo! Stock is set at a very reasonable price, and Google are willing to invest a significant amount of money.

Here’s what I would do if I took over Yahoo! tomorrow:

Focus

An Internet content portal above all else. In terms of competition, Google provide mail to compete with Yahoo! Mail however there is no one with similar a traffic size which provides the level of content as Yahoo!
Generate a cost/revenue model for services such as Yahoo! Mail and Flickr to see if it’s worth selling these on or keeping them and reinvesting.
Create a cloud development service model to compete with the likes of Amazon and Microsoft - turning a cost centre into a profit centre

Analytics

Work out where my users are coming from – is it mainly from PC manufacturer-set-browser-homepages which haven’t been updated for 5 years? In fact, I’d probably do most of my initial work on the analysis of who uses the individual Yahoo! services to ascertain the users’ value, or even try to derive an ARPU (Average Revenue Per User).

Innovation

Yahoo! strikes me as a company which is struggling to innovate. How many new services of note have their launched recently? I would look at why this has happened – have they all left to go to competitors? Internet companies need to have innovation at the centre of their philosophy, vision and corporate structure in order to keep users returning. I would reignite this passion for innovation immediately.

And finally, I think I’d rebrand Yahoo! to drop the exclamation mark! (Pun intended).

tags:

Microsoft, cloud, content, email, google, innovation, web traffic,

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Why your web traffic is going to increase this summer

Jun 15, 2011 at 1:24pm

The next version of the Google Chrome browser will help speed up users' web experiences by preloading the first result in the background.

If you are able to construct good Google search terms and often find you click on the first result, the new experience is going to save you several seconds per result.

If you manage a website which usually appears as the first result on Google searches, your traffic is about to substantially increase, because each of those pre-fetches is going to register a visit and a page impression. Google will offset this by offering a plugin to Google Analytics - great if you use Google, and it will be interesting to see how the other analytics providers will handle this.

tags:

Google Chrome, analytics, google, usability, web traffic,

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10 years since joining

Jun 2, 2011 at 8:13am

This time ten years ago I joined IMG as the Development Manager to build a new Content Management System.

The digital division within IMG was about four years old at that point, and had bought the digital rights to a number of sports organisations with the hope that the advertising and sponsorship on those sites would cover the costs of writing huge cheques to the sports organisations. 'Hope' is a strong word, because at the time the Internet bubble was at it's height, and we all thought we'd be billionaires by Christmas.

When I joined, IMG was pulling out of a number of these deals, and looking for efficiencies with the tiny development teams.

The Internet was so different back then. Products were very expensive. Vendors and 'experts' were all learning as they were going along - so when we got stuck, we were well and truly on our own. For instance we tried different CDNs (Content Delivery Networks) to handle the huge amount of traffic we were experiencing, and ended up creating our own using Cacheflow servers. Just looking up the link just now made me laugh - because these boxes used to be the size of a fridge, and now they're the size of a PC. Once we'd got the Cacheflows stable, we simply migrated to Akamai.

I remember people, including the CTO, would sleep in the office when we expected incidents to happen. I remember arguments with database vendors about licensing - some wanted to charge for every visitor that accessed the website, because they saw that as a database user. I remember running analytics reports on websites that used to take several days to compile, and when we wanted to run the report again with a different metric, all the numbers in the report would change! That same report in SiteCatalyst now takes a second to run and end users run it themselves.

Most of the really difficult stuff back in 2001 is now a commodity. Half of those products now have a freeware solution.

In around 2005/6 I moved to the client side - project management and operations. The CMS was very stable, and it was time to look at a decent off-the-shelf solution because we were losing pitches because of our lack of multi-lingual support, versioning, WYSIWYG editing and advanced SEO support.

We chose Sitecore as the CMS platform, and for the first time we looked at offshoring to India to migrate our sites. Three months of total pain followed. For the first time since joining IMG, we missed deadlines (in sport, although it sounds obvious you can't miss deadlines - most of the time you might as well not deliver anything than deliver a project late). We pulled the projects back to the UK and an army of contractors joined the development team. Some were good, some weren't. We started to offshore to Eastern Europe instead. And it was a revelation:

Being able to fly there and back in a day (not recommended, although possible and sometime necessary);
The cultural similarities;
The push-back nature from developers on some of the requirements.

Then in late 2008 we looked to outsource more work to Romania via Endava. What started off at a simple outsourcing deal changed at the last moment, and the staff TUPEd over to Endava in January 2009.

Since then we've worked on some new projects outside of sport, and the Web has become a stable, maturing, controllable entity. In 2001 we were looking only to stabilise our clients' sites.

Our traffic (bandwidth, visitors and page impressions) have all increased exponentially in ten years, with some exponentially, several times. Social Networks have come and some of them have gone. Do they compete? No, they simply direct more and more traffic to our clients' sites.

And now to the future. In 2011 we are looking at providing data insights, personalised experiences, full integration with back off systems, and providing a true ROI for our client's digital properties.

tags:

Adobe, Akamai, Content Delivery Network, Content Management Systems, Endava, IMG, Romania, Sitecore, business, digital media, future, sport, web traffic, website production,

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Are accountants being replaced by IT professionals?

May 12, 2011 at 5:13pm

Facebook20is20made20for20accountants20and20not20online20marketing1

Fifteen years ago the professionals who worked across an entire organisation were the accountants. My best man trained as an accountant, and I thought his university course was excellent - it taught all aspects of business, so that he would understand each function of an organisation from manufacturing to HR to marketing to IT to sales.

In the last five years, it's now the IT professionals who work across the organisation. IT are invited into all aspects of the organisation. A new manufacturing plant needs to be kitted out with technology. The HR department want a new HR system. Sales need a new CRM system. A new marketing campaign will probably involve a website, and even if IT doesn't produce the website, IT will still have a decision role in the choice of Content Management System or agency. IT will probably have a role in recommending specific social media.

IT have become very good at understanding the Total Cost of Ownership (TCO) of doing something within an organisation.

Producing a Facebook Page doesn't cost anything. Someone in IT is going to ask who will look after it, who will answer the comments, who will keep the content fresh, what will the complaints process be. Suddenly the Facebook Page isn't free, it requires a couple of people to spend a couple of hours a day on Facebook.

This is because IT has become more mature in project management and understanding that Total Cost of Ownership. Ten years ago, IT got burnt buying software and then realising training cost more. And more powerful servers were required. And maintenance cost a lot more. So IT departments realised that to do something required calculating the Total Cost of Ownership.

Universities need to catch up quickly - they need to train IT professionals about the rest of the organisation and to learn to speak their language. Accountants have historically been good at this communication, and IT have been awful. IT love buzzwords and jargon. The rest of the organisation dislikes it. IT love to deep dive into detail. The rest of the organisation is bored by it.

I'd like to thank Ilan for inspiring this post a few weeks ago, and for a gentleman at Internet World yesterday for reviving the thoughts.

tags:

CRM, Facebook, IT, business, marketing, project management, sales, trends, web traffic,

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Re-educating clients on statistics

Apr 27, 2011 at 12:20pm

Ten years ago I remember sitting with our clients and trying to prise them away from hits to page impressions (which later became 'page views').

Now, we're doing the same by moving from page impressions to insight.

Page impressions are great for advertising. Well actually they're OK for advertising for two related reasons:

As long as adverts are sold in per-thousand-impressions (CPM), advertisers will stick with page impressions
Ad agencies have historically been very slow to adopt new business models and retrain their sales staff. See the slow adoption of CTR (Click Through Rates) as one of the most recent examples.

Insight is far more important as a measurement than page impressions. Consider what's more important: gaining more information about a specific behaviour or preference about all your customers so that you can understand them better, or knowing that you have n million page impressions per month, and that traffic has changed by x% last month?

It's a very interesting debate. I remember having heated discussions with customers ten years ago after they'd gone white after hearing that their traffic went from x million hits to y thousand page impressions per month. However once they had understood the new metrics, they found their rewards in the new CPM advertising business models of the day.

The new debate is a fundamental shift. We're not talking units of measurement any more. The calculations for insight are more difficult to quantify. However the brands that adopt true consumer insight are going to be making profits in different orders of magnitude to the old models.

tags:

B21, advertising, business, insight, web traffic, website production,

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Happy Birthday post

Jan 16, 2011 at 10:47am

This blog has now been going for a year, so I thought I'd share some of the readership statistics with you.

Between 18 January 2010 and 17 January 2011, there have been:

133 posts
2,556 visitors come along
3,723 page views on the site

In terms of geography, it pretty much matches where we have current and former colleagues, clients, suppliers and friends:

It's interesting to note that colleagues in Romania and Moldova spend the longest reading articles whereas colleagues in the US are either put off straight away, or read very quickly (quicker than the UK)!

The most popular article of the year was a review on Yammer where 300 people read the review - well above the daily average. Talking of the daily average, this has been steadily growing from nothing at the start of the blog to a steady 20-30 visits a day now.

These figures don't include the RSS feed readers or search engines which keep crawling the site.

A huge thank you to everyone who reads the blog (that includes you!).

My aims for 2011/2 are to double the traffic and have more people commenting. If you have any recommendations or articles you'd like to see, please let me know by adding a comment below or contacting me directly.

tags:

analytics, blog comment, blogging, web traffic,

0 Comments

Review of my 2010 predictions

Dec 24, 2010 at 11:16am

Back in January I made 10 predictions for Digital Media for 2010. Being open and transparent, how did these predictions fair over the year?

Reinvestment in Digital Media.
2010 was a great year for agencies. We have implemented a number of very large websites, both brand new brands and existing ones. In terms of reinvestment, clients are now looking into cloud computing and full disaster recovery.
Prediction rating: 10/10
Lack of new products due to R&D being slashed in 2009.
Looking back at new applications and products - what was released that made a big impact? The iPad (at the beginning of the year before being launched it was referred to as the iSlate). I predicted that the end of the year would see some launches, and Kinect was released in November. Before you start commenting that 2010 was the year of 3D TV, they were in fact launched in 2009.
Prediction rating: 10/10
A number of live events on YouTube.
Well, in September they launched live streaming. However I doubt most people really noticed. I'll knock some points off because I said "live is where the value is".
Prediction rating: 8/10
More Flex applications, less Silverlight.
Hmmm - more site are using Flex (BBC iPlayer download for example). HTML 5 changed the landscape significantly, and due to the ongoing spat between Apple and Adobe, agencies are nervous about any single vendor, and will move to the latest version of HTML instead.
Prediction rating: 3/10
SecondLife to further decline.

Second-what? The LindenX has just flattened out for the last couple of years - which means no more money is coming into the platform.
Prediction rating: 9/10
The UK to start accepting blogging at the same status as the US.
Absolutely. UK news programmes now interview blogging experts for their views and opinions. Blogs are quoted in the press (errr, but so is Twitter, so maybe it's just reporters' laziness).
Prediction rating: 10/10
Offline browsers make a comeback.
Perhaps 12 months ahead of it's time, this prediction didn't materialise. Before you think there is a gap in the market, we have been approached by a number of vendors in this space.
Prediction rating: 2/10
The FIFA World Cup sees huge use of video over mobile & broadband.
It's easy to forget the World Cup this year. If you were streaming it though, your view of the summer was probably very different to England supporters. Internet traffic reached a record peak (of almost 1Tb/sec) due to video over mobile and broadband.
Prediction rating: 10/10
Expect ebooks to take off.
Ebooks have exceeded all expectations for booksellers, so I was correct there. However magazines, sports programmes and other paper publications have been slow to move to ebooks, mainly because Amazon and other ebook retailers want such a high slice of the revenue. So if you're a football club that sells a programme for £3 or £4, you really don't want a new middleman taking 20-30% of your revenue to sell the book electronically.
Prediction rating: 5/10
2010... the year of Web CRM
There is still a major opportunity for a cloud based platform with efficient pricing. I do not understand why there isn't a white label SSO platform out there. Let me know if you can recommend one.
Prediction rating: 0/10

Pretty good going overall. Any more accurate and I'd be an octopus.

I'll post an article on 2011 predictions next week.

Photo courtesy of Shine 2010 - 2010 World Cup good news.

tags:

Adobe, CRM, Content Delivery Network, FLex, SecondLife, Silverlight, World Cup, YouTube, blogging, digital media, ebooks, predictions, video, web traffic, website production,

0 Comments

Facebook - the facts and stats

Sep 29, 2010 at 8:53am

If you're looking for information on the success and popularity of Facebook, here are two excellent resources:

tags:

Facebook, stats, web traffic,

0 Comments

The Internet equivalent to keying a car

Aug 5, 2010 at 8:21am

Well, clearly I've been upsetting a few people recently, because since yesterday this blog has been a victim of a DOS (Denial of Service) attack!

A DOS is the Internet equivalent to keying a car - pure hate, no 'reward' for the criminal, and just sucks up the victim's time and resources for several days.

To help prevent DOS attacks, websites can use technologies such as CDN (Content Delivery Networks), such as Akamai. So if you go to a site such as FIFA, Manchester United or The R&A, you're actually going to a server hosted by Akamai. And Akamai have literally hundreds of thousands of servers around the World, so they can handle the DOS attack. This is one of the reasons why their share price is doing so well.

With Akamai, the website pays for the data traffic, so during a DOS attack, huge amounts of data are served. So Akamai answer this by offering a 'DOS insurance' policy to mitigate the data costs during a DOS.

tags:

Akamai, Content Delivery Network, web security, web traffic,

0 Comments

Tags

Using Groupon and Quidco at Christmas

How I would Yahoo!

Why your web traffic is going to increase this summer

10 years since joining

Are accountants being replaced by IT professionals?

Re-educating clients on statistics

Happy Birthday post

Review of my 2010 predictions

Facebook - the facts and stats

The Internet equivalent to keying a car

Bradley Howard

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