Thoughts From The Cake Scraps

I try and follow Jeremy Schoemaker over at ShoeMoney and was reading the ShoeMoney Biography and loved his “Coke Theory”.  Here is the Coke theory from that biography:

Maximum and diverse revenue streams are built on fairly narrow marketing concepts that are then diversified. This is what Jeremy Schoemaker calls, “The Coke Theory. If you are already making Coke then you can make Diet Coke, Cherry Coke, etc and turn a profit on those as well. A company can achieve growth through small degrees of separation between sites, maximizing diversity within a small industry.

That is so true.  Really you can substitute almost any major brand in there.  I don’t even know how many types of M&Ms there are now but it is the same concept.  Skittles even tried it with Chocolate Skittles.  Okay, bad example.  So it may not work everywhere but it is still a great idea.

Basically the Coke Theory is all about branding.  What can we do with the brand or how can we leverage it?  That is the question(s) the companies are always asking.  But it is also perfect for a brand you may not always think of, yourself.

This can be a difficult thing to grasp.  I mean think of how most of us go through college.  If you are like me, you just want a job coming out of college and you are not too concerned with where, so long as it is in the general area of where you want to be.  I constantly struggle with balancing technical skills with strategic skills.  How narrow should I focus my development to become a stand-out in my current position?  How do I balance that with not wanting to corner myself because it is the only thing I am good at?

I have found that the Coke Theory helps strike a balance.  It is alright to focus on one thing as long as you are not afraid to branch out later on.  Take on risk!  These things will not always fall onto your plate.  You have to request them and find them; ultimately you branch out.  That is a great way to grow your skill set because even if you fail at one of these activities you still have your core skill set to fall back on.

You are a brand and a core competency is critical, but taking risks to find new activities and responsibilities is where you will really learn.  So when you get back to your job take a second and ask yourself: “What flavor of Coke can I create next?”

This post digresses a bit from web analytics but the business concept of Swoopo is so brilliant – but not endorsed by myself – that I had to post on it.  Before I get into this post I want to make one thing clear:

DO NOT USE SWOOPO!  YOU WILL LOSE MONEY USING THIS SITE!

Now that I have made my position clear I can get into how brilliant this site is for making money at the expense of others.  It is not customer service oriented and it is probably not going to have a ton of repeat customers.  What it will have is a huge pocket book as long as P.T. Barnum’s phrase holds true: There’s a sucker born every minute.

First I will lay out for you how the site works.  It is a ‘auction’ site…sort of.  Swoopo sells bids for $1.  Each time you use a bid on an item the price is increased by $0.15 for that item.  So here is an example:

Person A buys 5 bids from Swoopo for $5 total.  Person A sees an auction for $1000 and places the first bid.  The auction is now at $0.15.  Person A now has a sunk cost of $1 (the cost of the bid they used).  There is no way to get that dollar back, win or lose.  If Person A wins they must pay the $0.15.

Person B also purchased $5 of bids.  Person B sees the same auction and places the second bid.  The auction price is now $0.30 (because each bid increases the cost by exactly 15 cents).  Person B now has a sunk cost of $1.  If Person B wins they must pay the $0.30.  Swoopo now has $2 in the bank and the auction is at 30 cents.

This can happen with as many users as there are suckers to start accounts.  Why are they suckers?  Because everybody that does not have the top spot just loses the money they spent on bids.  *Poof* Gone.  If you think this sounds a little like gambling or a complete scam you are not alone.  People get swept up into the auction and don’t want to get nothing for the money they spent on bids.  I think you will understand it better if I show you an example of people getting ripped off on the site.

Please note that while the math in the laptop example assumes that the winner has to pay for the item, Swoopo has different types of auctions which are described in my post on types of Swoopo auctions.

An auction for a laptop that says on the auction page, and I quote, “Worth up to $1,399.99″  The winning bidder, as stated on the site, placed 2020 bids.  That is $2,020!!  And the auction page proclaims “Savings: 0%”  when it really should read negative!  So Swoopo made like $600.  BUT WAIT!  The auction started at $0.00 and finished at $3,353.85.  Now read that again.  They were already up $600 from the winners bids alone.  The winner sucker still had to pay $3,353.85 because that was the price of the auction.  Okay, so Swoopo walks away with a cool $4,000 pure profit.  (Like a bad TV commercial) BUT WITH THERE’S MORE!  Remember that bids are placed in 15 cent increments.  That means that if the auction finished for $3,353.85 you take that divided by $0.15 which equals $22,359 in bids!!!!  That brings total profit to $22,359 (bids) + $3,353.85 (auction) -$1,399.99 (retail cost of laptop, probably not their cost) = $24,312.86

This is not to say that there are no good deals on Swoopo.  The auction for $1000 finished at $568.20.  The winner of that auction placed 218 bids ($218 dollars worth) for a savings of 78%.  Why is it 78%?  because it is a 100% off auction  – see my post on types of Swoopo auctions– meaning that you don’t have to pay the final value of the auction (how sketchy is that).  In theory, if no one else would have bid, you or I could have spent $1 on one bid and won the auction.  If we would have won the other guys $218 would have been for nothing.  Now keep in mind that if this were not a 100% off auction that the winner would also pay $568.20 in addition to the $218 for bids.  Total investment: $786.20.  Is that really worth the risk of getting nothing?  I think not.

There are 2 kickers that I have to throw in yet.

1. Every time a bid is placed the length of the auction increases.  Therefore if a bunch of people “snipe” it at the end, the auction can go from 5 seconds left to 20 min.  Yeah.
2. And in case you were worried about the one who got away, Swoopo provides a “BidButler” that auto bids for you up to your set amount when someone out bids you.  If you are going to spend $1 a bid, please don’t let some BidButler do it for you.  After all they don’t call it “entertainment shopping” for nothing.

All said and done this seems like a little bit of a scam, praying on people that either don’t get it or are stupid.  If one were to use this site the only smart thing to do would be to research what auctions of stuff goes for and then place a single bid when it gets to that price and hope you are not out bid.  Anything else is just a waste of money.  That is, of course, if you ignore the fact that everybody else who has bid gets nothing.  It is a combination of eBay and gambling – more gambling (in that you must pay to bid but if you don’t win you don’t get anything).  Think of betting on red in roulette, you only get something if you win otherwise it is gone.  At least if you win there others can win as well.  If it were Swoopo roulette if you won everybody else would lose.

It is just amazing – and yet totally understandable once you get the mechanics – that this site made money selling $1000.  $3788(bids) – $1000 (cost of item) = $2788 profit.

Paraphrased Swoopo business plan in short: find 10 people to give us $10 each and one of them will get this $20 gift card.  Repeat.  Official Song: I Get Money

What do you think?  Scam?  Brilliance? Awesomeness? Just another web site?

10/6 UPDATE: Check out my new post on PennyCave, a Swoopo look-a-like!

So you know that you are tracked by e-mails.  You are going to beat the system.  You are not even going to use a search term to get to the website because you know Google will track you along with the website.  You are going to direct load – typing the URL into the address bar – and avoid being tracked.  Almost, but no.  Chances are that the site gave you a cookie last time you were there.  Oh well, you tried.  But that is not what this post is about.  Just because you got to the site without tracking, does not mean that you will not be tracked.

Internal campaigns are exactly what they sound like.  They are campaigns that are internal to the site.  A campaign is anything that the site is doing to try to get you to buy more stuff (or whatever the conversion metric would be, such as filling out a survey or something).  E-mails are campaigns.  Billboards are campaigns.  A site or company runs advertising campaigns. You get the idea.

The banner that you see across whatever site you are on is sure to include an element that says that you clicked it – a tag.  Note that I am only talking about a banner that is on the site and for the site, not an advertisement for a different site.  The advertisement for a different site would be an external campaign for the company that bought the ad.  We are talking about an ad for another item on your site – perhaps for an LCD monitor when you are looking at computers.  I call this a real estate campaign or an internal campaign.  I call it real estate because the site is tracking based on the tag on the banner and the site knows the location of the banner, the real estate. I call it an internal campaign because it is for another product that will take the visitor somewhere else internal to the site, not push them out the door to an external site.

So you clicked the banner and were tagged.  It is in this way that the site can track how often the banner is being used (instances) as a rate of how many people saw the page it was on (page views).  This also allows the site to understand where someone is clicking on the site.  Each area of the banner could contain a different tag, thus if you clicked the t-shirt you could get tagged with a value of tshirtclick while if you clicked the jeans on the same banner you would get tagged with a value of jeansclick.

Internal campaigns are very useful for a site because they allow for a wide variety of reporting.  The site will know how many conversions they got that clicked on the banner and how much revenue is associated with it.  This also is a much easier way to track traffic from a page.  Perhaps a single page has multiple banners and the site wants to know how many people clicked the banners.  With no tagging on the banners, all the site would be able to do is look at what pages visitors went to next and add them up.  For instance if there is no way to get to the jeans page from your home page and yet 20 of the 100 visitors took that path you can assume that they must have clicked on the jeans banner.  But then to add that up with the page that took them to the t-shrits and the page that took them to the pants, and to…etc. is a huge pain. By the time you get to the number of estimated clicks (because in theory they could have the page bookmarked or something like that) you won’t care any more.

Look for more the post forthcoming about purchase influencer tagging on Thoughts From Thee Cake Scraps.

Interruption is a way of life here in America. I remember reading somewhere that in Japan if a person is working by themselves they are not as likely to be interrupted because it is assumed that they are in thought whereas in America if you are working by yourself it means you are available because it is assumed you are not busy. Not sure if that is true or not, but I know that if I see someone at their desk I will talk to them if I need them. I always ask if they have time, but I still ask because – in famous final words fashion – it will only take a second.

How does this relate to web analytics? It relates because of the definition of a visit. If you are new to web analytics, you may wonder “What is a visit?”.  Web Trends Live has an excellent glossary of terms which is where I pulled this definition from:

Visit: A visit is an interaction a unique visitor has with a website over a specified period of time or activity. In most cases, if a visitor has left a site or has not executed a click within 30 minutes, the visit session will terminate.

My question is, is this the correct length of time? Should it be longer than 30 min because of how many distractions/interruptions we have in a day? I read a great interview at FastCompany.com about how often people get interrupted at work. The average time between switching tasks was 3 minutes and 5 seconds. That is a lot of moving around. It took an average of 23 minutes and 15 seconds to get back to something they switched from.

This would give credence to the 30 minute rule that is laid out for us, but I still have to wonder if it is correct. I think that with tab browsing people are more likely to have a longer lag time between looking at one page and looking at another. I think that since the onset of ‘restore session’ – when you open up a browser that you previously exited with multiple tabs active – lag times between activity have increased. ‘Fires’ come up at work and need to be handled, e-mails come in, the phones ring, etc. The reality is that while a person may be idle for 30 min they would say that it was one visit. This begs the question of who defines a visit, the web site or the viewer?

My main concern is that this time frame may skew some data that looks at visits by a visitor for a given period of time. Perhaps you will get data that says people visit your site multiple times in one day – probably considered a good thing – when really you just can’t keep a visitors attention and they keep having a 30 min or more delay in between their activity. This would actually then be a bad thing because you are not keeping the viewer involved which may discourage them from coming back.

Clearly an industry needs standards and, honestly, web analysts are lucky to have any standards at all in a field that changes so quickly while being so young. That said, hanging on to old standards just for the sake of standards isn’t such a great policy either. It doesn’t need to change today, but it is something to keep thinking about as browsing habits evolve.

In my post You Are Being Tracked: E-mail Style there was some discussion/confusion about when I said:

Hopefully you know that Google keeps track of everything you have searched for.  Ever.

Well this it true and false depending on how you read it.  GHamilton noted that Google does not keep everything you searched for.  Rather they keep it for 18 months.  The key word here is “YOU”.  In a recent post on the Google Blog Google announced:

Today, we’re announcing a new logs retention policy: we’ll anonymize IP addresses on our server logs after 9 months. We’re significantly shortening our previous 18-month retention policy to address regulatory concerns and to take another step to improve privacy for our users.

You may see where I am going here.  GHamilton is correct in that from and individual IP perspective after 18-months, or rather 9 months now, Google no longer has history on you specifically.  I am correct in that Google really does have “a history of everything you have searched for.  Ever.” with the caveat that they no longer know that you were the one that searched for it after 9 months.  If you are interested CNET does a great job of getting into the nitty-gritty and explains why the ACLU is so critical of Google’s privacy policy.

Hopefully that helps clear things up a bit for people.  Let me know your thoughts.  Do you care that Google keeps your data for 9-months?  Should it be longer/shorter?  Should they keep anonymous search history forever?

Most people probably already know that they are being tracked.  There are all sorts of programs and ways to do this at all sorts of levels.  For instance your ISP may track you and give (sell) your data to a company like Hitwise – privacy policy can be found here.  I actually saw this in a newscast last week.   They interviewed some guy about what popular search terms are and tried to make it sound creepy.  Amazing! People search for weird stuff on the internet like “how to make bombs” and *gasp* “porn”.  This guy must be some sort of genius!  And he looks at historical data! Brilliant!

Hopefully you know that Google keeps track of everything you have searched for.  Ever.  Anyway, the part that people probably don’t know as much about is how individual sites track you.  One way a site can track you is by tagging you when you click through on an e-mail they send you – the focus of this post.  Think of tags as dated stamps in your passport book.  Interestingly enough, some of this tagging can be easily found in the address bar of your browser.

When you see something in the address bar that looks like emid=584783 that is telling the website that your internal – meaning site specific- e-mail address ID is 584783.  This value is unique to a single e-mail address. Each e-mail sent to that e-mail address will have their unique emid attached to all links in the e-mail. This also allows a site to build a history of that e-mail address – not only for activity, but for response rate as well.  Now every time you click through an e-mail for that site they have more history.  Note that larger sites rarely look at individual behavior but instead classify a behavior and then analyze that group.  Still, the information is there.

In addition to an e-mail ID, there is usually a campaign variable such as cid=Sep08FreeShipping.  This allows the site to report on everything with Sep08FreeShipping stored in the cid variable. All of this information is contained within the link that you click from the e-mail. If you get the e-mail and directly load their site, not through the e-mail, the activity will not be tracked because in a direct load no value would have been assigned to cid.

These variables do not have to remain in the web address the entire time.  They are stored in the background after the initial click. So when you no longer see emid or cid in the address bar, but originally arrived at the site through the e-mail, you and your activity is still being tracked.

Look for at least one more installment of how you are tracked. There I will focus more on how a site tracks internal campaigns. Hope this helped give some people a better understanding of how websites track you.