Serguei Alleko Blog

3 years ago I was completely disappointed in banners. We’re started several campaigns and never get any positive ROI from them. May be they help with branding or visibility, but I can not measure it.

3 years later and again we’re trying to start a campaign. Another couple of thousands euro spend on experiments.

The banner is big, it’s dynamic and it’s adjusted with the information from the visitor.

Result is – conversion 0.05 – 0.07% (zero dot zero seven per cent, I didn’t mistype number of zero’s)

May be Seth Godin was right after all about his ideas of permission marketing. You got to get some permission from a user before feeding them advertisement.

• Banners on web-site -zero permission from the web-site visitor. 
• Emails via some online community – already better, people have agreed to be part of the community, they expect emails.
• Google Adwords – some more permission, people are typed a search term themselves, they expect some information.

If you sell software online, you don’t need logistics. You just generate a code and send it per email. Basically you’re selling air. It’s called Electronic software distribution. But not all of us belong to Generation Y and easily accept virtual payments for virtual products. A lot of older people prefer to have some physical object.

In software world its typically called a Backup CD-Rom. It’s just a copy of your software, which normally everybody downloads via your website, burned on a CD-Rom.

It’s amazing (for me at least) how may people are willing to pay for it 5-10 €. But they do.

Every night and 01:00 a script imports e-store data in the CRM and CRM generates list with addresses of the people, who bought a Backup CD-Rom. In the morning an office assistant prints the addresses, places CD-Roms in envelopes and puts them to the postman.

At some point I had an idea to outsource the production.  I was looking for a company, which can:

Once per 5-6 month:

• Produce and print CD-Roms with the software and nice layout in our company style
• Print nice CD-Rom wallets in our company style
• Print nice stylish paper with our logo (for the letter which goes with the CD-Rom)

Daily:

• Accept per email a list with addresses for the people, who need to receive the software
• Print their name with some text on the offical paper with our logo (“Dear mr Smith,…”)
• Print their name and address on a sticker for the envelope.
• Put CD in the wallet
• Put wallet and offical letter  in A5 bubble envelope
• Put sticker on the envelope
• Sent it per post
• Must be affordable

It was not easy to find such company in Netherlands. Almost all of them are doing only printing of CD-Roms and marketing materials, not sending them. The one I found is Blue-Digital (not commercial link). I hope they can save us a lot of time and money and  I’ll write more about experience with them later.

Yesterday I gave a 15-min presentation to mostly non-technical people about everything what we’re doing with Google. It came to just a few bullet points

1. Google is number one because they really trying to find you the best and the most relevant  information possible.
2. The most important for the relevance of the search results is: Trust important (good, cool) sites and don’t trust unimportant sites. Important sites comes first in the search  and get the cream – views, visitors, clicks. 
3. How to be important?
   • Good way – deliver great content. If we make a search for general words, like “virus” or “Johnny Depp” we find out that, for example, Wikipedia or IMDB are very important sites.  They have megatonnes of great content
   • Not so good way – optimize your content. Make it more “google-able” or make it more convenient for mostly text-only google engines. Here comes SEO (Search engine optimization).
   • Bad way – just buy your way through the search. Yes, it’s possible. Just use AdWords and come together with the best content sites. It’s good to be rich.

And yes, we’re following all three ways. Marketing department following  the good way, webmasters are doing the second and I’m busy with the third, sorry.

In every European country, if you buy something, you have to pay Value Added Tax (or VAT) It ranges per country from 15 till 25% per country.

• If you’re a private person, you just have to pay it, no matter what.
• If you’re a company or self-employed, you can deduct this tax via complex procedure with your accountant.

This procedure becomes even more complex if your company is located in one European country and you’re buying something in another. In this situation you can ask from a shop, if they can sell it to you without VAT at all. 

It is possible, but not all the shops provide this service. You can not just come to a supermarket, show your VAT-id from neighbor country and ask for non-VAT payment. It has to be a special “B2B” shop.

If you have a e-store, it’s also not very easy:

1. You need to ask a VAT-id from all your customer and check it via official European Commission VAT-check web-service, called VIES (VAT Information Exchange System). Finally something useful from European Commission! You can also check a VAT manually here.
2. Then your shop need to provide order without VAT tax and your CRM must understand it
3. (worst part) When your accountant has to provide a tax declaration for VAT, you need to represent every transaction separately, including information about client’s VAT. A lot of e-shops don’t provide this service because of difficulties of tax declaration

In general, if you’re located in one EU-country and want to go abroad, check it with your accountant, may be it’s not such a good idea.

Some time ago, as a technical person, I couldn’t understand the complexity of the whole subject of web  statistics and analytics. 

• Web-statistics – measuring how many pages were visited and when
• Web-analytics -  trying to understand what it means

 When you know little, it’s always easy to build a logical solid theory about something.  That’s why people, who analyzed their first month of logs sound so sure about themselves. When you’re learning more, you find that your logical solid theory must be expanded. Then expanded some more and more. At some point you find out that your initial theory was completely inadequate. That’s a point on your learning curve called “I know that I don’t know anything”

I’ve reached that point about web-analytics on a training from Omniture. They have 2 days basic training on how to use their software. And 2 more days advanced training on that. And this is only for users, not for administrators!

OF course biggest part of the training was not statistics, but analytics, the way how to analyze your results. The subject is very complex. But actually, I figured out that simply the measurement of such objects, as “hit”, “visit”, “visitor”, “page view” is more a craft than a science. Read more here about key definitions in web-statistics.

So, why the web-statistics is complex:

• The philosophy of underlying protocol  HTTP is not really helping the measurement. The protocol is session-less and asynchronous. You don’t exactly know what user has done on your website and weather it was successful, you have to guess
• The philosophy of web browsing is not really designed for interactions. It assumes that user just reads text, clicks and reads further ahead. If user is trying to do anything else, like go back or reload or double the page, browsers react differently and sites react differently. Very hard to measure.
• The philosophy of HTML is not really designed for modern interactive WWW. It has nothing to do directly with statistics, but it lead to creation of number of new technologies, like flash, java, AJAX etc. And those are often difficult to measure
• What is a difference between pages anyway? Google Analytics defines it as change in the URL of your browser. This leads to a number of problems, like difference between / (just slash) and http://alleko.com/ (site name with slash). Also some technologies allow to change pages without changing URL
• When user opens a heavy homepage of a site, his computer makes 50-100 or even more TCP connections to the web server. Sometimes is hard to define that it’s one hit.
• It’s not obvious when to detect an end of a visit. User most often closes the browser when he doesn’t want to be on the site anymore. An industry standard says 30 minutes after the last hit

Different vendors have different approaches to the measuring, so often data from Google Analytics don’t match with Omniture or something else. Don’t worry, they’re not manufacturers, they’re crafters. Ironically there is no really standards in web-analytics either. Is 4% conversion high? Is 20% bounce rate low? Nobody could say for sure, every site is unique.

The only thing we can do is to compare comparable. Just choose one solution and measure your success against your success last month. Of year. You can not measure objectively.