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Flawed analysis of statistics on web video conversion rates

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Web video’s meteoric rise

Web analytics firm, KissMetrics.com today blogged about the success of video in converting web traffic into buyers, based on data collected by the Austin-based video company, Invodo.

KissAnalytics wrote, “The great thing about online video is that people vastly prefer watching over reading (just consider the last time you watched the news versus reading a newspaper!) It spans nearly every industry and demographic. Organizational housewares e-tailer StacksAndStacks.com reported that visitors were 144% more likely to purchase after seeing a product video than those who did not.”

Without a doubt, web video is increasingly popular, with an average of 200 billion video views per month now and rising, and the time spent watching video is simply skyrocketing. Consumers want video, they crave it, they are coming to expect it, we offer no argument there.

Invodo cites MediaPost, noting “product videos play a key role in consumer purchase decisions, citing a 9x increase in retail video views at the start of the 2011 holiday season.” That is an amazing jump in video views and is quite impressive.

Where the argument gets sticky

Any seasoned marketer will tell you that increased foot traffic does not always mean increased sales – the pricing could be wrong, the packaging or presentation might be off, or the wrong demographic targeted, leading to stagnant sales regardless of traffic. Additionally, increased sales does not imply increased foot traffic. The two are linked, but are relatively independent while depending on a variety of factors.

The argument is being floated around blogs nationwide, not just at KissMetrics that somehow increased traffic or sales implies that people prefer video over reading or that increased video views means rising sales, and it is simply not proven by the statistics quoted. A retailer noting that visitors that watch a product video are more likely to buy is not necessarily true either, as the analysis does not take buyer intent into consideration – it is possible that what is equally likely is that buyers that intend on purchasing at the outset are more likely to watch a product video to affirm their decision.

The analysis that web views and sales rising is akin to saying a retailer has doubled foot traffic in January (likely because of an ad they ran in the PennySaver) and sales rose (likely because they dropped their prices by half). There are too many variables to simply decide that a rise in video views or sales means consumers prefer to watch video or that they are basing their decision on video – it is just as likely that they are affirming their decisions based on video.

What the data does prove is that the number of web video views are skyrocketing which shows a consumer demand for video, without a doubt. The data also proves that web sales are on the rise (which may or may not be linked to video viewing as buyer intent is unclear), as they are every year as online shopping has become mainstream.

More studies of the growing video industry will prove one way or the other in coming years – the current analysis may or may not be a misinterpretation of a complex set of numbers.

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33 Comments

33 Comments

  1. Russ Somers

    January 17, 2012 at 12:37 am

    Lani, thanks for creating an opportunity for everybody to better understand this. It's a high-interest topic so a lot of stats are put out there. Sounds to me like unrelated stats in the same post are being mistakenly read as though they're supposed to be related. "Sales are rising because video views are rising" isn't the Stacks and Stacks story – or the story of our many other clients who see benefits from video – at all.

    You're right that the difference in purchase behavior between video viewers and non-viewers doesn't prove causality – but it is a strong correlation and consistently seen across our client base. An interesting side note is that the correlation increases when the data is multisession. That makes sense when you consider a research-intensive purchase like a laptop or a smartphone. Viewed that way, single-session data on a purchase likely to involve any amount of research may in fact be understated.

    The online retailer has an advantage over the offline retailer running both the Pennysaver ad and the sale. Online retailers can, by A/B testing, control out intervening variables. When our clients have done this, they've confirmed conversion lift from video.

    The interesting thing to me is that conversion lift is not always the biggest decision driver for the retailers and brands we do business with. Site experience is hugely important to them, as are user engagement and SEO.

    FYI, at the start of February we'll release some research done in conjunction with the e-tailing group. It's designed to directly understand how consumers engage with video in shopping contexts. From what I've seen of the numbers so far, it'll contradict some conventional wisdom – looking forward to getting it out.

    Thanks again for raising the issue!

  2. Andrew Mooers

    January 20, 2012 at 8:27 pm

    The flavors offered are not just vanilla and chocolate any more. And the delivery methods of the media streams need to be varied. In the mode the real estate buyer and seller want, expect. Reach, frequency and impresssions. It all boils down to for ever hundred impressions, a desire result happens. It is a numbers game. And also, just because a set of eye balls and ear drums sampling today's local area or real estate are not called in to action does not mean that you don't need to build, feed that video channel for when they are ready to act.Video works, is more memorable and quickly uses two or more senses to connect, engage your audience. Give them some video they can relate to. On a regular basis to develop the habit. Get the results hitting the target.

  3. Carbonless

    January 23, 2012 at 8:14 am

    It's just another in a line of "quick fixes". Everyone should have a blog, everyone should add social media, everyone should add video.

    No – no – no!

    First, get clear about your market, their problems, your message, your brand, your offerings, your benefits…

    Then, if video is the right way to deliver that message, use it. If it's flyers, if it's direct mail, if it's email, if it's banner ads, use them.

    There is NO shortcut.

  4. Ruthmarie

    January 23, 2012 at 9:55 pm

    This is an interesting discussion. I sometimes try to put myself in the publics shoes by examining my own preferences. If it is a high-ticket item, I'm going to want to have some reading material, charts, graphs and information I can LOOK AT and analyze in my own good time. Video won't do that. Now since, I'm a real estate agent, that's important. This isn't an iPod, its a major purchase.

    The other thing is that as people flood into video….it will become less unique. So some of the advantage it may have had will be neutralized.

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Business Marketing

The secret to crafting consistently high-converting emails?

(BUSINESS MARKETING) Email may seem too old to be effective but surprisingly it’s not, so how can you get the most out of your email marketing? Try these tips.

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Email marketing

Email marketing might seem archaic in comparison to modern mediums like social media, blogging, and podcasting; however, it actually remains one of the highest converting options marketers and small businesses have at their disposal.

But Why Email?

Hopefully you believe in email as an effective marketing channel, but in case you have doubts, let’s hit the reset button. Here’s why email marketing is worth investing in:

  • Email is one of the few marketing channels that you have total control over. Unlike a social media audience, which can disappear if the platform decides you violate their terms, you own your email list.
  • Email is considered very personal. When someone gives you access to their inbox, they’re telling you that you can send them messages.
  • From a pure analytics perspective, email gives you the ability to track behaviors, study what works, and get familiar with the techniques that don’t.
  • The ROI of email marketing is incredibly high. It can deliver as much as $44 in value for every $1 spent.

5 Tips for High-Converting Emails

If you’ve been using email, but haven’t gotten the results you’d like to, it’s probably because you’re using it ineffectively.

Here are a few very practical tips for high-converting emails that generate results:

  1. Write Better Subject Lines

    Think about email marketing from the side of the recipient. (Considering that you probably receive hundreds of emails per week, this isn’t hard to do.) What’s going to make you engage with an email? It’s the subject line, right?

    If you’re going to focus a large portion of your time and energy on one element of email marketing, subject lines should be it.

    The best subject lines are the ones that convey a sense of urgency or curiosity, present an offer, personalize to the recipient, are relevant and timely, feature name recognition, or reference cool stories.

  2. Nail the Intro

    Never take for granted the fact that someone will open your email, and read to the second paragraph. Some will – but most will scan the first couple of lines, and then make a decision on how to proceed.

    It’s critically important that you get the intro right. You have maybe five seconds to hook people in, and get them excited. This is not a time to slowly build up. Give your best stuff away first!

  3. Use Video

    Email might be personal, but individual emails aren’t necessarily viewed as special. That’s because people get so many of them on a daily basis.

    According to Blue Water Marketing, “The average person receives more than 84 emails each day! So how do you separate your emails from everyone else? Embed videos in your emails can increase your conversion rates by over 21 percent!”

    This speaks to a larger trend of making emails visually stimulating. The more you use compelling visuals, the more engaging and memorable the content will be.

  4. Keep Eyes Moving

    The goal is to keep people engaging with your email content throughout. While it’ll inevitably happen with a certain percentage of recipients, you want to prevent people from dropping off as they read.

    One of the best ways to keep sustained engagement is to keep eyes effortlessly moving down the page with short and succinct copy.

    One-liners, small paragraphs, and lots of spacing signal a degree of approachability and simplicity. Use this style as much as you can.

  5. Don’t Ask Too Much

    It can be difficult to convey everything you want to say in a single email, but it’s important that you stay as focused as possible – particularly when it comes to CTAs and requests.

    Always stick to one CTA per email. Never ask multiple questions or present different offers. (It’ll just overwhelm and confuse.) You can present the same CTA in multiple places – like at the beginning, middle, and end of the email – but it needs to be the same call. That’s how you keep people focused and on-task.

Give Your Email Marketing Strategy a Makeover

Most businesses have some sort of email lists. Few businesses leverage these lists as well as they should. Hopefully this article has provided you with some practical and actionable tips that can be used to boost engagement and produce more conversions. Give them a try and see what sticks.

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Business Marketing

Restaurant chains are using COVID to masquerade as indie food pop ups

(BUSINESS MARKETING) Applebee’s and Chuck E. Cheese appear on delivery apps under aliases. Is this a shifty marketing scheme or a legitimate practice?

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chuck e cheese pizza

Restaurants have pivoted hard to stay alive during dine-in shutdowns due to the coronavirus pandemic. Some are selling grocery items like eggs, flour, and yeast (check out the pantry section at the Brewtorium!) while others have created meal kits so families can cook up their restaurant favorites at home.

Meanwhile, a few large chains have been busted for re-branding their kitchens to sell more meals. A reddit user in Philadelphia reported that they ordered pizza from Pasqually’s Pizza & Wings thinking it was a local business they had yet to try, only to learn it shared a kitchen with Chuck E. Cheese. As it turns out, Pasqually is a member of Munch’s Make Believe Band, the terrifying mascot band led by murine bad body Chuck E. Cheese. Pasqually is the confusingly human drummer (and Italian pizza chef?), joined by lead canine guitarist Jasper T. Jowls, sweetheart chicken Helen Henny on the tambourine and vocals, and the dinosaur? Closet monster? D-list muppet? Mr. Munch on the keys.

Though this inter-species band should be disturbing enough for us all to rethink our childhood memories of Chuck E. Cheese (let’s be honest, Disney World should be the only place allowed to have adults parading around in giant mouse costumes) what’s more upsetting is the competition it creates with locally owned restaurants. In West Philadelphia, there is another restaurant called Pasqually’s Pizza.

Chuck E. Cheese is not the only restaurant re-branding to save their hides. Applebee’s has launched a “brand extension” called Neighborhood Wings. Customers can order larger quantities of wings (up to 60!) from Neighborhood Wings, but not Applebee’s. You know, for all of the large parties people have been hosting lately (thanks COVID-19).

This restaurant run-around is further evidence of the noise created by third party delivery apps. GrubHub, Postmates, and others have been criticized for taking huge commissions from already low-margin restaurants, and providing little added value to profitability and industry worker wages. Using these platforms as a means to build shell restaurants for large national chains is just another example of third party apps doing a disservice to both its clients and customers.

Of course, Applebee’s and Chuck E. Cheese are franchises. If one wanted to go out on a limb for these brands, it could be argued that they are indeed ‘local’ businesses if their owners are local franchisees. The third party apps are simply another platform for businesses to gain a competitive edge against one another within a specific customer segment. Furthermore, consumers should hold themselves accountable for their patronage choices and doing their due diligence when investigating new pizza and wings options.

Nonetheless, it behooves all of us in this pandemic to get to know our neighbors, and build relationships with the small businesses that are the lifeblood of a community. Restaurants exist thanks to local customers. Try placing your order directly on their website, or give them a call. I am a restaurant worker, and I truly am happy to take your order.

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Business Marketing

Restaurants might actually lose money through Grubhub and similar services

(BUSINESS MARKETING) Restaurant owners are asking themselves if third-party food delivery apps are nothing more than a good, old-fashioned shakedown.

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grubhub site

If you haven’t seen the GrubHub receipt that has everyone outraged, you probably should. It exposed the food delivery apps for their unreasonably high commissions and excessive charges to the restaurants (on top of the changes to the consumer).

Many people, in an honest attempt to support local restaurants while staying home and safe these days, have started ordering out from their favorite small, local eateries. And they should! This could be the lifeline that allows those restaurants to survive being closed for upwards of a month. However, if they order through a third-party food delivery service, they need to know that a good chunk of their money goes to the service, not the local business. Plus they are paying extra for the service.

It’s a big bummer, to say the least, a bamboozle some might say. Why would restaurants agree to use these services at all, then, if they aren’t beneficial? Well, they initially served the purpose of helping smaller restaurants and food trucks sell to a wider customer base without having to incur the cost and manage the logistics of offering delivery. Not all of the charges are immediately apparent, either, although I am sure they are in the business agreement.

GrubHub, DoorDash, Postmates, UberEats all charge eateries a commission between 15%-30% to even work with them. This is for the most basic level of service. When GrubHub, for example, wants to stimulate more sales, they may offer a deal to consumers. This could be a dollar amount or percentage off of a customer’s order or free delivery.

Everybody loves a deal, so these promotions are effective. They drive more sales, yay. The restaurants, however, incur the full cost of the promotion. You would imagine GrubHub would share that cost, but no, they don’t. If that weren’t unscrupulous enough, GrubHub then charges the business the commission on the full, not discounted, price of the order. Unctuous, right?

Sure, restaurants have to opt in for these specials and other promotions the third-party apps are marketing, so they know there’s a fee. Yet, if they don’t opt in, they won’t appear as an option for the deal in the app. It’s deceptive, feels like a bit of extortion to me. All of these delivery apps have some sort of similar way to rack up fees. For a mom-and-pop food truck or restaurant, the commissions and fees soon eat away at the already small profit margins restaurants usually have.

It’s simply wrong, so wrong. But wait, there’s more! Another nasty, duplicitous practice GrubHub (specifically GrubHub) has implemented, with Yelp’s help, is to hijack the restaurant’s phone number on Yelp. This means if you look up your favorite restaurant on Yelp, and call in an order from the Yelp platform, your call will actually go to GrubHub instead. And get this–they charge the restaurant even if you pick up the order yourself, not only for delivery.

These third-party companies have even started buying up domain names similar to the restaurants to further fool patrons into ordering through them. They also have added restaurants to their platforms, even if the restaurants haven’t agreed to work with them. They seem willing to do anything to get a cut of restaurants’ hard earned dough (and ours). Loathsome! How are these scams even legal?

It happened to me recently. I kept trying to order for pickup at the restaurant, but somehow the order kept going through GrubHub. Bamboozled!

RVB bamboozled

This boils my blood and breaks my heart for these restaurants. In my other life, I am a blogger for a hyperlocal blog whose sole purpose is to highlight, celebrate, and promote local everything. I’m also the internal marketing chair for the Austin Food Blogger Alliance, where we work with local restaurants, distilleries, breweries, and such to promote them and help raise their visibility in the community.

I only bring this up, because I’ve sat with these restaurant and food truck owners, listened to their stories, seen the fire in their eyes as they talk about their recipes. They’ve regaled me with stories of how they got started, what inspires them, and when they had their first successful day. It’s delightful to see the intensity of their enthusiasm for sharing good food with people and how much of themselves they put into their restaurants.

In the original post that lifted the curtain on this shady practice, the Chicago Pizza Boss food truck owner Giuseppe Badalamenti, says the money he got from his GrubHub orders was “almost enough to pay for the food.” Badalamenti had participated in some promotions, which admittedly reduced his cut dramatically, yet the whole premise came as a shock to customers who have been spending their dollars to keep these local businesses afloat. Then here comes the third-party apps, poking a hole in the floaties.

It comes across as downright predatory. Thousands of people have sworn off these apps in favor of calling the restaurant directly for pickup if you are able. This way, you ensure the business you want to support gets the full bill amount. You can get the restaurant’s number directly from Google Maps or the business’s social media or website. This is the best way to help your favorite places stay in business.

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