Apple does this very well. Salesforce does this even better.. The Lock In – Good or Bad?

What is “The Lock In”? Not sure if it has been used before but I’d like to claim that I coined the term. I’m sure someone will jump at me but until then, I coined it.. there. The Lock-in is what I call it when you buy a product or service and you are then locked-in to that agreement even though their is no obligation to do so.

I’ll throw out a few examples. Have you ever used Salesforce as a CRM system? Have you ever decided to export your database to an excel file or similar? There is no function to do so and therefore you are “locked-in”. Your contract has finished and you want to try another CRM system but you can’t export your data easily so your stuck. The lock-in. You probably end up choosing to continue with their overpriced service simply because the cost and effort or switching is really not worth it. The lock-in. There is a way in fact to extract information from Salesforce but its through a function so far fetched from anything mentioning “export data”. And oh yes, there is a mighty big “import” function their for you, don’t worry. But export? Ha! Dream on! It’s hide and seek Salesforce style.

Apple does this well too. If you buy an Apple computer, iPod, iPhone or whatever and you need accessories then you better buy Apple products. The lock-in. Software? Gotta be Apple. They are no doubt getting a little bit better but its there and it’s obvious but tolerable. It’s tolerable because Apple has loyal and dedicated users who take pride in using Apple products.

I recently was confronted with the lock-in when it came to my car. I drive an Alfa Romeo 147 GTA. Looks great, goes great but built by a bunch of lock-in specialists. I needed a light fixed on the car and I thought it should be no big deal. Well this car has ‘lock-in’ written all over it. In order to change the headlight you need to remove to whole front bumper of the car, charged at $160 per hour by Alfa specialists. Then they need a special Xenon light bulb which can only be provided by Alfa (think of the charger of your phone, only one particular adapter will work) and this costs $475 for the bulb alone. That’s not a typo, thats Four Hundred and Seventy Five dollars for a light bulb! Oh and by the way the ballast/transformer powering the light is damaged and I’ll need genuine Alfa ballast for this too. That will cost $1490. Once again, not a typo. So 4 hours of labor removing the bumper and installing the parts, plus the Ballast and Bulb will set you back a total of $2605. $2650 to change 1 single light on my car! Thats one mighty lock-in.

I understand why it’s done and any good entrepreneur or businessmen will look at working with some level of ‘lock-in’. In cases such as Apple, they can get away with it as their products have a ‘cool’ factor plus they have a great brand associated with it. Salesforces is purely frustrating until you figure out how to do it. Alfa is ridiculous as you are only buying parts that provide a functional aspect to the car. I understand if I needed a new set of wheels, thats different but the lock-in though all the mechanical aspects is just plain ludicrous.

My final  thoughts on the lock-in? I’d buy Apple for sure. I’d use Salesforce again and although it can be inconvenient their lock isnt so hefty. I will never buy an Alfa Romeo again. Ever.

Take note: when you use your ‘lock-in’ use with immense care because a lock-in can be used positively in a manner to promote your business and improve relations with your customer. In the same light it can also cost you a customer for life.

It’s happened to everyone at some point. You hear about a great new movie coming out, lets call it for arguments sake, Sex and The City. Actually no, we can’t use that, that was beyond terrible. Let me think of another example. Ok so you hear about this new movie called Australia and plenty of hype was behind its release into cinemas. It comes out and surprise surprise, the critics blast it. Rubbish, terrible, boring, awful. In reality, it was probably just an average movie. If you picked it up off the shelf at the DVD store you’d watch it and say, yeh not bad. Not great but not bad, you know.. average.

So why did the movie critics absolutely blast it? Think about it, the movie wasn’t terrible. Wasn’t even bad, it was simply average. You would be right in saying that the hype behind it caused a massive anti-climax when the movie finally came out and because it didn’t live up to the hype and the expectation, people deemed it as a flop. However that’s another story completely.

There is another element here that is taking effect. That is that people no longer tolerate “average”. We live in a world of web 2.0 where everything is intertwined and whatever information we need is literally on our finger tips. We expect everything for free or maybe in return for our (other) email address. Even the Telcos are treating us like people! Can you believe it.. people!!!! That’s just insane!

Only 10-15 yrs ago people expected average. Average customer service. Average airlines. Average electronics. Average cars. Bank West. Virgin. Apple. Tesla. Just think about this paragraph a little bit before going onto the next one.

The key point is that people no longer tolerate average stuff. TV advertising is dying because its pretty average. Mobile media is growing because it’s not average, although in a few years it may be.  Today, if you release a product that is average then it’s not actually average, its boring and awful.

The aim here is to be extraordinary in whatever you deliver and also how you deliver it. It doesn’t necessarily have to be in the product itself but can be through your execution, your marketing and your communication. I know it can be a bit scary going out on a limb and not following the standard procedure but if you don’t someone else will. That person may not succeed but if they do, not only will the rewards be highly prized but you’ll probably find yourself doing what they do but with less reward.

I mentioned in my previous post how I am able to get Google Adwords traffic for 1c per person. It’s truly a bargain in that for only $10 I can get 1000 users to my site who may benefit from my services, hopefully click an advertisement or even better, purchase a product. But is it really a bargain?

First of all, there is very little chance you can make up the advertising dollars spent by the advertising revenue on your site. To effectively get good advertising revenue, either through Google Adsense, Adbright or whatever, plenty of organic traffic is the way to go. Why? Well first of all you need to think of your site as a real business. Where advertising is your revenue model, using paid Adwords traffic to drive traffic is effectively your cost of goods sold (remember accounting 101: COGS?).  It’s your main expense. With organic traffic you don’t have that expense. (I know, not too technical here).

Most importantly however, (this is the part to really think about) Adwords traffic is traffic that came from a contextual environment. A contextual environment is your ad showing up on a relevant and contextual keyword search, another site or a blog that is in a similar niche. So the amount you pay for an ad is roughly the same amount you will receive for a click on your site, as you also run contextual ads. This means that in order for you to make a profit, or even break even, almost everybody who comes to your site must click an ad. You will need a 90-100% CTR on your site which isn’t going to happen. The only way around this is to drive traffic from probable alternatives (ie get traffic to a credit card site from a job search site) but then it will be difficult to get good conversions as your not playing the percentages. Or you can run several ad campaigns from different ad networks but then again it would kinda look like this.

But what if you sell a product? I’m still not sold on this. I honestly don’t think that Google Adwords does that great of a job to drive qualified and potential customers to your online business. I may be wrong and you may have a completely different take on this so if you do, please share. Some bloggers have their own secret tips. There are too many factors you need to overcome in order to break through to the sale. These include your anonymity, trust, competition and desire from the consumer. I can’t imagine that receiving 10,000 people from Google Adwords would compare to receiving 10,000 referred and organic traffic, either by word of mouth or through recommendations.

Genuine organic traffic is traffic that is not complicated with the earlier mentioned barriers of anonymity, trust, competition and desire. I think if your interested in running a successful online business the hardest part will be developing a following and building the genuine organic traffic.  Nothing valuable comes easily overnight, it requires you to provide value, day in day out and accept the fact that the rewards are long term. Sure you can use Google Adwords and I’m sure that you will benefit from it, but the real value comes later down the track when your effort and persistence becomes worth the effort. Work hard, don’t give up and keep at it as everything else is just a fragile quick fix.

Using Google Adwords is a fantastic way to drive traffic through effective contextual ads. Unfortunately for many industries it has become extremely expensive. We all dread that pink pastel colored warning box at the top of the screen and that classic “Bid is below first page bid estimate of A$15.65″. Who is crazy enough to pay $15.65 to get on the front page? You must have either been selling something that has a crazy conversion rate or was lulled into using Google Optimization strategies to be paying $15  a click!

(Quickly just on that, what Google’s Adwords optimizations strategy actually does is take all your money quickly and gets you 10-12 visitors for your $50bucks worth. Don’t bother with it.)

Now before I go on any further, I’m assuming you know a little bit about Google Adwords, not a lot just the basics. If you don’t there is so much info out there on it you’ll figure it out within 3 minutes. Don’t buy anything, all the info you need is free so don’t get sucked in. The best resource would be Google’s own info regarding Adwords or simply just try it yourself and dive in.
So if your in an extremely competitive market what can you do? You don’t want to be paying $10 a click do you? But you don’t want to be on the second to last page either. I personally had this problem with a games business I run. When I tried to promote free games on Google Adsense i’d have to pay at least $1.50 to be on the front page. Now don’t think that means you’ll be in a good position on the front page, we are talking $1.50 to be on the bottom of the ladder of the front page. To be at the top your probably looking at double that, probably more.

Then I discovered a way to manipulate my listing so I could get traffic for much less than that. I went down to 20c a click then to 10c. Then down to 5c. Then ultimately down to 1c! I was getting targeted traffic to my site for 1c per click! How did I do this? I skipped the search side of Adwords and focused on the content network side.

You only ever hear of 2 things when it comes to Google advertising, Adsense and Adwords. Many people fail to understand that they actually go hand in hand. Too many online marketers separate the two and use Adwords in their search marketing and put Adsense on their site to generate revenue. Adsense is nothing more than other people’s Adwords campaigns that have come up in the content network. Let’s take the facts. Adsense revenues on average are steadily declining. 4 – 5 yrs ago Adsense clicks were much more valuable and it was not uncommon to see sites getting 30+ dollars eCPM (effective cost per thousand – ie how much money you’ll probably make per thousand impressions). Today, with the exception of some competitive niches, such a figure is unheard of. What does this mean? It means the costs to get in other people’s Adsense ads, ie the content network, is now much cheaper. People are making less money through Adsense which boils down to the ads on their content pages costing less. This is in comparison with search engine marketing which is now more expensive for good keywords.

Still a bit sceptical? Well I have taken a snapshot of my Adwords account for an online gaming site I was promoting. Check it out:

Adwords Snapshot

The first white row from the top shows stats from the search network. The column under show the stats from the content network placements. The difference is extraordinary. Click through rates arn’t good either way but that’s not the point, with the amount of inventory you can receive using the content network, you’ll get the traffic. Looking at the stats again, I paid on average 28c per click on the search network and 1c per click on the content network. I got over 24,500 people for $278 using the content network. To get this from the search network I calculated that I would need to pay almost $7000!! I don’t know about you but that’s a serious bargain!

How do I get on the content network? Easy. All you need to do go to “Edit Campaign Settings” in your campaign summary page and make sure that the content network is clicked in the Networks and biddings section. Here you can also choose to disable search marketing which will make Google focus on delivering your ads in the content network. Now you should be placed in the content network.

Even better, there are not even more advanced options where you can tell Google what sites you want to be displayed on. This is excellent as you can simply find the site’s that your target market most likely visits and ask for your ads to be shown on them. This is great for slightly off-topic ads such running a promotion for an online business opportunity and putting it on job search site. This is really easy to do as well (as with most things with Google!). Click on the campaign summary and then click on the ‘ad-group’ you have created. You will see four tabs on the right hand side of the screen. These say Summary, Keywords, Placements and Ad Variations. Now click on the ‘Placements’ tab and there should be a button that says “Find and Add Placements”. Click this then I would recommend you choose the “Describe Topics” tool and do a search for your desired target topic. Then select the sites you want to have in advertise in! You will need to go back and edit your campaign settings (previous paragraph) so you can change the content network targeting to “Relevant pages only on the placements I target”. And that’s it.

Sounds a little long winded when you write out the steps, but it’s dead easy. Hopefully now you will be able to work your way around those expensive keywords and yet still place your ads in a contextual environment. The key is to test it out. Don’t go straight down to 1c. Try 20c, then 10c and so on until you reach a point where you are paying the least you can before your traffic starts dropping off. I was lucky to go down to 1c but your niche may be different. Of course by using the content network you may not have the direct targeting of certain keywords but then again, who has that budget?

I’m not usually one who jumps on a fad and runs with it. Nor am I one who says you can get anything, FAST. It took me an age to get onto Twitter and even now I’m not extremely active on it. Occasionally I look at my messages, click through to anything that interests me and that’s about it. I like it, but I’m not gaga. Yet a month or so in I have over a thousand followers and I spend about 3-4 minutes a day on Twitter.

The big hype with twitter is in its networking capabilities and the opportunity it presents to be in touch with those in your same field of interest(s). This has led to the theory that the bigger network you have, the better. In my opinion I would rephrase this theory as the bigger network of like minded people you have, the better. It’s not exactly your Napoleon Hill Mastermind group but a large network can provide you with interesting and useful information as well as allow you to get your message across to people with roughly the same interests.

So how do you get a good number of twitter followers that will follow you back? Well here is a way to get 237 twitter followers off the bat. These are people on Twitter who have over 10,000 followers. The trick here is to be observant. What do all these people have in common? What you will notice is that for many of these Twitterers (can’t believe I just used that word) their number of followers roughly match the number of people they follow. What this means is that most of the time, they will follow back whoever follows them (hence the name of the article).  Not exactly rocket science but I thought I would state the obvious anyway!

Now that you understand the principle of “follow me-i follow you” you can use it to your advantage. What we know is that people tend to befriend those who have roughly the same amount of followers as they do people they follow, that’s why you befriended the 237 in the above list. That means if your likely to follow back then it is more likely that people will follow you in the hope that it will be reciprocated.

You will notice that you will need to spend a bit of time finding people you wish to follow (and will most likely follow you back) especially in the early stages. However as your followers increase an interesting snow-ball effect begins to happen and you will notice more followers coming your way without you needing to follow them in the first place. This occurs as your list of friends grows and you effectively become viral and hit a certain critical mass. In essence as most friend lists are public, your profile becomes more prominent and people begin to notice.

There is another technique I have used to increase my followers. I was considering whether or not I should put this in my blog in the first place but I want to show that I do have a sneaky side, a side that we all have somewhere. First of all, I am not one of those people who will just add anyone, I usually quickly check a person’s profile before I add them but I will follow the majority of people who are in my related field nevertheless. On the other hand there are people who have Twitter pets and Algerian wrestlers as their followers, yet regard themselves as “online entrepreneurs”. These people are Twitter gold. You can also spot these people by looking through their profile and realising that the only posts they make are the one’s promoting their blog. I ignore Oscar the pooch and find those followers that are in my related field and ad them as chances are they will follow me back. The reason behind this is actually quite cynical but I will explain. I call these Telstra Twitterers, in that they have nothing great to offer yet people flock to them because it’s easy to do so. People following Telstra Twitterers can’t be to picky (because they added them in the first place) so it’s very easy to get these people as followers. It doesn’t make the followers any better or worse but you know that chances are, they will follow you back.

This is probably one of the most candid posts I have written but it seems to be the topic of the day and everyone wants to put their 2 cents in. People have created membership sites and businesses based around getting plenty of Twitter followers. Some bloggers such as Problogger state that you need to be active on Twitter to generate a large following but that is fine for someone like Darren who people recognise but I have seen many people who are extremely active yet only get a trickle of followers. I have also seen some Bloggers who pump out drivel, day in and day out, yet have several thousand followers (Telstra Twitterers). It doesn’t make sense until you dive in a little deeper and find out whats happening.

In essence its just a case of looking at a profile, asking yourself whether or not this person is most likely to follow you. Then ask the question, is this person a Telstra Twitterer? If so, find their followers that are relevant to you then add them, chances are they will add you back. I know, it’s not all noble and organic but did you really expect it to be?

An old online saying is that ‘content is king’. In all respect this is true as sites with a lot of great valuable content come out on top. Look at sites such as Steve Pavlina.com, millions of hits a month and it looks, well, pretty ordinary. So is this proof that content is king or is it not so clear cut?

Well the truth I believe, is that it is pretty clear cut. Great content accessed easily is the real king. Sure without content you have nothing but if you can’t access it you’ve also got nothing. Back to Steve Pavlina, here is a site with a load of great content (I strongly recommend you go have a read) but what it also provides is a remarkably efficient way of distributing this information. Some people say the site is extremely simple and almost boring but these people are missing the point. The site is laid out in a way in that someone can come to the site, read up- to-date content and at the same time be able to read other interesting articles without even searching for them. The user interface is absolute genius. It’s straight forward, simple, exceptionally clear and allows you to read more with every sitting. All this and he doesn’t even have a logo!

I think this ease of use has been somewhat neglected with many web 2.0 and other modern day websites. The introduction of Flash and to a lesser extent Java and even Microsoft’s Silverlight have greatly aided the ability to create aesthetically pleasing websites. Don’t get me wrong, there are both advantages as well as disadvantages of using software such as flash however just because they look great doesn’t mean that they have a good clean and easy to navigate user interface. Beautiful isn’t always better.

I came across a few examples recently which I thought I would share. The first came around when I was searching for movie session times. The two main cinema companies where I am are Hoyts and Greater Union. A couple of years ago Hoyts had a fantastic search function which enabled you to find your movie and the session time in about 20 seconds. Now they have decided to get all flashy (literally) and not only created a website that takes several minutes to load due to all the bells and whistles, but also a site that leaves you analysing and strategically thinking about your next move. Any mistake in your browsing skills will no doubt lead you to an irrelevant page that took you 3 minutes to load. Woe be tired anyone with a slow connection, your better off going the old school paper way. Check out this eye-sore:

The ‘Watch’ section on the left is to ‘watch’ movie trailers… not where or when you can ‘watch’ a movie. So you will aimlessly fiddle around with this to no avail and wonder why everything is taking so long while it loads all the movie trailers. So you think about clicking the ‘all cinemas’ tab… and it does nothing. Now your confused. Then you look to the top and think, do I select ’session times’? Also what’s this ‘Buy’ section on the right? Bingo… these will get your your session times (finally) and interestingly enough, ‘Buy’ and ‘Session Times’ both give you the same information yet provide two completely different ways to find it! It’s like taking the back streets or the main road… both will get you to the same place but look different on the way there. What’s the point? Why waste this space and clutter the site up? Why not put ’session times’ as the heading instead of “buy’ and you won’t need that ’session times’ option anymore. Anyway, who goes and ‘buys’ a movie session?? What genius thought up this heading? It doesn’t make sense. Have you ever told a friend “I went to the cinemas the other day and bought the best movie!” I understand they aim to sell tickets (ie buy movie tickets online) but because it’s so unclear, off the bat your confused. Give customers want they want straight away, then give them the option to buy it. First comes first, people will only buy tickets once they find the session they want to buy the tickets for. Give them to right information first then ask for the buy, not the other way.

In contrast you have greater union. Load time is decent however most importantly, as soon as you hit the landing page you know what to do.

Can you see it. Bright blue standing out from the rest of the site? The site leads to exactly what I wanted without me even thinking about it. The first thing you see is ‘Select a Cinema’ and ‘Select a Movie’. They want you to ‘buy’ as well but the site naturally leads you to finding the movie first, its the first thing you see and your first chance to interact. The search section is prominent and stands out from the rest of the site and there are no movie trailers confusing the issue or an unclear heading. Directions are simple; ‘Buy movie tickets online’ as opposed to ‘Buy’.

My other examples came about when I was searching for an online TV guide. Australia has terrible Formula 1 coverage and I wanted to see if Qualifying or Practice was being shown live (of course it wasn’t but that’s not my point. One HD preferred showing paintball! Yes… Paintball!). Here is an analysis of two sites I came across. I’ll put them both right after each other and you decide which one would be easier to find (the non existent) Formula 1 TV times:

Tv Fix Snapshot

Australian TV Guide Snapshot

It’s not rocket science is it? It’s Yahoo vs Google. Its convoluted Vs simple and precise. If your after a TV guide, which one of these would you choose to deliver you your content? And guess which one uses flashy bells and whistles and takes an eternity to load? Some people just don’t get it do they?

I should state that my blog in itself isn’t as user friendly as I would like it to be. I wouldn’t rate it that good either but I’m working on it and it’s a continual work in progress. I believe a simple and precise user interface is a trademark of a great site and the reason behind even average looking sites such as Steve Pavlina’s being so successful. They easily lead you to great content. Don’t get caught up in purely aesthetically pleasing developments to your site as it may just compromise the usability. The key factor to remember is that if people can access good content easily then your onto a winner, having one without the other will only  lead to traffic killing friction.

In my previous post I was referring to a medium which is growing at a phenomenal rate yet has very little barriers to entry and is probably sitting at where the Internet would have been 9-10 years ago. I’m referring to mobile. Entrepreneurs are still shying away from using mobile as an e-commerce tool however this is starting to change with the introduction of the iPhone as well as advancements in PDA style phones, Blackberry’s and most recently Google Android. These advancements have also extended through to “normal” phones with screen resolutions of 128×128 through to 240×320.

Technation released figures stating growth of 23% in 2007 and 30% in 2008. VKI studios talks about Nielsen report data stating that mobile growth has occurred 8x faster than PC Internet growth! More? Well the CNN mobile site now receives 30 million monthly page views compared to 2.7million when it launched in June! Take a look at a company such as Admob. Admob is the leading mobile advertising agency providing a service similar to Google Adsense (and Mobile Adsense of course!) however targeted to mobile phones. To date Admob has served over 70 billion mobile ads and has only been serving since 2006. As of the other day the company launched an iPhone download exchange supporting iPhone developments.  This is a mega dollar infrastructure supported by companies who understand the importance of mobile. This is not a stagnate or even a steadily growing market. This is growth at a tremendous rate. What this outlines is proof that plenty of people are browsing the net using their mobile and where there is an abundance of traffic then there is a requirement for good content to service this traffic. This is content that you can profit from through delivering great value and meeting a demand.

I think the reason behind people not flocking to mobile is the misconception that mobile sites look terrible and functionality is limited. Yes, you cannot serve funky flash banners, frames and complex coding through all mobile browsers (some do allow it.. and this is also growing) but why is this a bad thing? What this means is that you have limited options in order to get the most out of your mobile website. In the online PC world there are practically no restrictions with what you can do so your left with a world to choose from with your budget deciding your next move. You don’t really have this problem with mobile and this is great news for the entrepreneur who wants to start with very little. You create a functional, mobile friendly site which incorporates a good user interface and design and you are already at the top of the game!

Do they look that bad? No, I don’t think they do. If you have a look at your mobile providers main mobile page (ie Vodafone Live ),it’s not your usual html text style site. There are colours, pictures, banners and a decent user interface. However unlike developing for the PC world, it’s not really that complex. It doesn’t need to be and frankly it can’t be. Currently a mobile site is great if you include images, clean style and has clear functions. This means that with very little outlay you can immediately start competing with the big boys! This will obviously change over time but the key is to get in first, develop a solid customer base and grow from there. To single yourself out from the traditional boring mobile sites takes only a little effort but the rewards are well worth it as along with the PC world, to be successful you  need to create the perception of being an industry leader, a forerunner and an expert in order to be a success.

People are yet to provide great content specifically for mobile. I am a motor sport fan and currently there is only 1 decent F1 site dedicated to mobile. One. Do a PC web search and there are hundreds! On top of this their service can be greatly improved, its only scraping the surface. Imagine how many people are needing your expertise via their mobile? Yet no one is there to provide. First mover advantages are in abundance in the mobile world where the traditional web really only has room for ‘me too’s’ with a few exceptions (don’t ask me what these exceptions are because if I knew I would be on to them!).

I can only see this growth continue to escalate. Mobile phone advancements are rapid but most importantly, network operators are also understanding the importance of web browsing via mobile through to provision of data caps and data packages to support mobile web browsing. Only a year ago browsing the net via your mobile was extraordinarily expensive while now, its often included in your package. This alone is testament to the phenomenal growth of mobile.

I currently have a few projects on mobile and am looking at setting up a mobile business course over the coming months to help people get the most out of mobile. I will also be going over a few of my current projects as well as a new one I will be starting shortly. What I will do is cover the process of creating the mobile site, marketing the site as well as it’s progress including traffic and revenue details. I’ll be candid and open so I appreciate any feedback or advice you may wish to give.

I recommend you jump on your mobile, open your browser and do a search for your area of expertise. You’ll be surprised at the opportunities that are still available, especially with such a large and growing user base. The best time to find your second business opportunity is while your still working on your first one.