Has the World Turned into Google?

The importance of Google AdWords and other Google-related marketing tools in the marketing mix is sometimes overestimated.

Have you ever asked yourself what percentage of your customers really come from Google AdWords? I am sure the answer will be different in every given case. However, is there anything besides (and above) Google?

First of all, let us look at Google AdWords in relation to organic search results. According to the Search Engine Journal, 80% of web users seldom or never click on Google AdWords, focusing on organic search. Clearly, as their online experience grows, most web users are becoming more and more immune towards web advertising and even develop negative feelings towards personal targeting.

Secondly, though the share of Google and Google-powered search engines in countries like Germany may reach 90%, in other countries it may not be the case. For example, the Russian search engine market is still dominated by the Yandex company (60% market share), the same is true for most Asian countries, where search traffic is driven by local search engines. Thus, the share of Google worldwide is well below 90% and, as I think, would be realistically estimated at around 50%-60%. Another point to consider is the aggressive competition by other search engines even in Google-dominated countries and the danger of the Icarus Syndrome for the market leader.

Thirdly, the share of web content indexed by search engines is very small (some estimates point at the share as low as 0,2%). The so-called Invisible Web or Dark Web includes specialized or password-protected databases and catalogs, data shared and posted on social networks, and non-indexed data formats, such as pictures or video content.

One more barrier to consider is what percentage of time your target users spend online, how often they use search engines, and if they use search engines with a clear intention to purchase something at all. The reason is that Internet is mostly perceived as a means of entertainment or as a free information source, which significantly decreases the ROI of SEM advertising.

And last but not least: how digitalized has the world become in reality? Has everyone in this world acquired an unlimited access to the Internet 24/7? Has the share of life we live off-line become so insignificant that it does not need to be considered any more? Have we stopped talking to each other face -to-face, reading books and magazines, watching TV and listening to the radio or just shopping at local shops? Naturally, no.

In conclusion, by writing all above, I am not going to undermine the importance of online marketing in the marketing mix or deny the growing size of the potential market on the Internet. However, in my opinion, the reliance on Google-related marketing tools has become a self-fulfilling prophecy for online marketers, the marketers themselves representing a (thin?) slice of population who actually actively use the Internet and can handle the Internet technology. A lot of things in online marketing are assumed without profound data on the on-line and off-line behavior of the target users or on the relative importance of the advertising instruments used.

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Social Networks in Russia (Part 1)

And the winner is…

Despite the aggressive marketing efforts of Facebook&Co. to invade the Russian social networking market, the three leading social networks (according to the number of registered active users, statistics by WCIOM and TASS-telecom) are VKontakte.ru, Odnoklassniki.ru and MoiMir (project by Mail.ru).

Below I will give a brief description of functionality and background of these three social networks.

Ondnoklassniki.ru (Classmates) was created by Abert Popkov in Russia in 2006 and two years later was sold to the Mail.ru Group (http://corp.mail.ru/en).

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It allows the users create groups, send messages and find new friends, as well as share and upload photos, videos, play online games and bookmark the content from other users. It also has a built-in function to detect profile visitors (“My Guests”) and a “Like” button (“Klass!”). It offers a collection of music tracks and allows posting music directly onto the profile or download/upload tracks.

MoiMir (MyWorld) was originally created as part of Mail.ru Group. It has recently introduced a new user interface, that basically makes it more similar to Facebook.

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MoiMir’s functionality is basically very similar to that of Odnoklassniki, it also offers other functional features directly from the Mail.ru project (such as Ask-Answer Forums (Otvety.Mail.ru).

Both MoiMir and Odnoklassniki offer some extra features for the users (such as visiting pages anonymously, without being shown in the “Guests” tab) or a “VIP” account for a fee. Another interesting way of collecting money directly from the subscribers is selling stickers or virtual “presents” that can be paid for and added to the account or directly to the profile picture of another user. The same system works for “grading” a picture of another user with the best grade “5+” or “+10”.

Of course, B2B customers are also welcome. These sites also work with the Facebook model in targeting the user groups for advertising, though the costs are measured per 1000 impressions only. The accounts of both social networks, however, can display adverts from Target. Mail. Ru (a service similar to Google Ads).

Another website VKontakte. ru (InContact) was created and is still owned by Pavel Durov.

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The functionality includes adding and sharing music and videos, playing online games, etc. The “Liked” content does not get shared with other users automatically (as on Mail.ru Group sites), it requires a separate click on the “Share with friends”. It is the only one of the three leading social networks that has user interface in English (as well as in other languages).

Advertising possibilities for companies on VKontakte are identical to those of Facebook.

Despite a number of extra features, some functions included on Facebook are missing. All the three networks in question do not distinguish between a “page” and a “group”, no additional functionality is offered, thus company pages have to be set up as “public groups”. Another drawback is that the visibility of separate wall posts cannot be controlled, though MoiMir allows to limit the visibility of the whole profile to friends only.

In the following posts I will take a broader look at the social media landscape in Russia.

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Will Market Research Survive?

No, I do not want to make a prediction about the death of market research as such, but rather some of its forms that have traditionally been the “cash cows” of large market research companies.

Take, for example, panel research. The very essence of retail panel research is being ruined by the growth of e-commerce. Measuring at the point of sales is becoming more complicated now.  Who can possibly register the flow of goods from numerous on-line shops, especially those outside the country? There is a missing link there, and the gap is growing.

Another area which is unlikely to survive very long is test market with measuring advertising response.  As online marketing budgets are growing and the advertising shifts from TV and radio to the Internet, the companies feel more empowered to track their own advertising campaigns and optimize them as they please.

Even in qualitative research, traditional focus groups may, to a large extent, be replaced by scanning online forums and social media for new ideas or suggestions for improvement. Moreover, the data are available globally and in real time at no extra cost!

And last but not least, desk research has become increasingly simplified through the  use online search engines and other digital data mining tools. Possibly,  in some years, complete market research reports which normally took months to create and used to cost thousands of dollars will be created in a few mouse-clicks using special software.

Think of the new World 2.0 as an interlaced, data-overflown place, where the consumers and whole markets are getting more and more transparent, with or without professional market research as we know it.  Shifting strategic weights and entering new fields of play will probably be the biggest challenge for market research companies in the years to come.

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