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Wednesday, Oct. 10, 2007

Traffic Delusion and Social Networking Insanity

By Howard Kaplan
October 10th, 2007

“Advertising only accelerates the inevitable” –Roy H. Williams

Traffic... MyPreciousIn Roy’s practice, advertising builds brands and drives traffic for his offline clients. Roy cautions his clients not to get ahead of themselves. If all the traffic (read: visitors) he drives get what they expected, then the business grows organically from repeat customers and word-of-mouth. If these visitors don’t get what they want, their lackluster experience will erode the brand. In other words, they would be refilling a leaky bucket with new traffic. Unfortunately, the supply of new traffic is never unlimited.

Jeffrey Eisenberg likes to ask, “Are you paying your marketers to make promises that your business has no intention of keeping?”

On the Web, how much traffic is enough?

If your site has a few thousand visitors a month, what would you do with a few thousand per day? Sadly, with average conversion rates barely hovering in the low single digits for most markets, for most of us, a sudden boost of traffic would do little more than squander our audience. In fact, we’d simply do it faster. When your funnel leaks like a sieve, do you really want to turn on the fire hose? Conventional wisdom on the Internet says ‘yes,’ but I challenge you to ask yourself if that’s wise, or just more convenient.

Bryan touched on this topic yesterday, and Robert Scoble, Dave Winer and the Guardian are debating the concept over at Techmeme. Scoble claims he wants a “smart” audience, not a “big” audience. (Sounds like he’s found conversion.) He can model a smart audience, plan an experience for them, then measure and improve upon that plan. A big audience — just for the sake of winning the Web’s version of “Best Looking” superlative (technically speaking, of course ;) ) — I’d imagine leaves him with the same void some people feel when they grow up, only to realize they’d peaked in high school.

Let’s contrast this with a story I read in yesterday’s Internet Retailer. Our friend Dustin Robertson from Backcountry.com has been experimenting with one of their brands on MySpace. They’ve spent a year, added 3,000 friends, and still can’t find a correlation (forget causality) between MySpace and sales. He acknowledges the experiment costs only a few hundred bucks per month, so their current plan is to keep it going.

Typically, when I hear things like this, Einstein’s definition of insanity comes to mind (or Franklin’s or Twain’s, depending on who you believe originally uttered the quote). In this case, though, it’s more a symptom of the low relative cost of doing business online, and the large numbers the ‘net provides. We’ll happily chase our tails on the logic that we only need a small success to realize the value of a home run.

Funny. Given that thinking, I’m surprised more people don’t take the, “If we build it, they will come” approach to traffic. Of course, that only works if you build what visitors want, and give it to them the way they want it. Do that, and you just may be amazed at how much profit you can squeeze out of the traffic that stops by for a visit.

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Comments (10)

  1. Hey Howard…I like your site. As a new entrepeneur and owner of
    mothernaturesports.com I apreciate and look forwards to all info and comments.Love “grok” the name …will try to share info (not “share water”-…as in the book?) I have not opened a blog yet (still getting over fear of flying I gues?) :0) Dan

  2. Great post. About two weeks ago we launched our new search engine “Search Free Apps” (www.SearchFreeApps.com), and the launch was covered by the Wall Street Journal. The publicity was great, but what has been even more interesting is to watch the ripple effects.
    We are finding that the conversion from different sources (links from the Journal, specific social networks, specific blogs) is dramatically different. Some social networks have almost no conversion whil some blogs yield almost 100%.

    What this suggests to me is that it’s also worth putting a lot of time into thinking out your publicity strategy. It’s very clear that visitors to http://www.SearchFreeApps.com originating at certain places are far more likely to convert than others.

    So, even if we realized the fantasy of a huge social network surge it might be far less valuable than reviews in a few key blogs.

    Bruce Judson
    Founder, Search Free Apps
    http://www.SearchFreeApps.com

  3. Thanks for bringing us back to the basics.

    Those websites that sustain success have found a way to give a targeted niche of people something meaty enough to make them stick around.

  4. We are also trying to get started with social networking and would greatly appreciate any help or suggestions in this regard.

    So far we have found face book to be better than myspace.

  5. That was very insightful Howard.

    Thanks,
    -Aurelius :)

  6. We are embarking on a journey down a new road. Having had the Social Networking mantra beaten into my head by the Internet Retailer conference in San Jose. I decided to build on an old social networking model that we have had in place for years and was costing us a lot of money returning a very negative ROI. One of the problems with building a social community is the fallout. We made a change to one of our social channels (an email community) and the nastiness continues to this day. We built a blog and a discussion forum at a very low startup cost.

    If interested the blog resides at
    http://countrylife.lehmans.com and the forum is at http://lehmanslife.lehmans.com.

    What I have found is we have some very loyal and driven customers. This may sound like a great audience to most but there are (as always is the case) problems.

    The experiment is in its infancy. However I am pleased to report a very low startup cost. Better than expected support from our internal community (employees and management). As well as an excellent response from our users and the internet as a whole. The final question is: Am I getting a positive ROI? the easy answer is ‘NO’. The better answer is: ‘Not Yet’, I believe there is a lot to learn and a different (perhaps more subtle) way to market using these channels.

  7. Additional follow up to my earlier post. I am considering diving into the Facebook and Myspace communities. I am slightly hesitant tho.

  8. That is why I am not turning on the hose quite yet. Not ready to open the flood gates and get wet.

  9. I appreciate you bringing us back again to the basics.

    Those sites that sustain good results obtain the right way to give a targeted niche of folks something informative and jam packed with good content that’s enough to make all of them stay.

  10. Targeted traffic to a site with relative content is what the customer wants and the site owner.

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