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The Final Digital Divide

  |  March 5, 2009   |  Comments

Are you aligning your business' priorities, budget, staff, and strategic thinking with the behavior and preferences of their customers? Here are three principles to consider.

Articles and headlines from quarterly publications like Strategy + Business magazine, weekly research reports from eMarketer, and daily blog posts from Online Marketing for Marketers, state the obvious, yet point to the hard-to-reach goal of crossing the digital divide.

Consider these stats and trends from recent published reports:

  • Dunkin' Donuts has more than 370,000 Facebook fans, according to this eMarketer interview with David E. Tryder, manager of interactive and relationship marketing at Dunkin' Donuts.

  • Many Fortune 500 companies, such as Hewlett-Packard and Intel, invest at least 50 percent of their marketing budget in digital.

  • E-mail service providers are experiencing record financial quarters.

  • SEM (define) consultants and digital agencies are reinforcing the undeniable shift to digital.

One stat that stands out is the Tweet from a friend at Active.com, who was attending the Interactive Advertising Bureau's annual conference in Orlando, Florida. This friend cited a speaker who pointed out that two-thirds of marketing dollars are spent offline while the rest is spent online. My response was, "How long will it take for that to flip flop? Two years maybe?" And therein lies today's "digital divide."

In the 1990s, the digital divide referred to the gap between those who had broadband access and could work efficiently online -- and those who didn't. In business, it's safe to say we've crossed that divide. Consider that e-mail is the primary and preferred method of communication and information sharing, while researching information and products, is almost exclusively online. And, instant messaging, texting, and social networking are the next generation of online communications.

Digital divide now refers to the divide between those aligning their priorities, budgets, staff, and strategic thinking with the behavior and preferences of their customers. HP's chief marketing officer was recently quoted saying he's spending more than 50 percent of his budget in the digital arena. Microsoft and Intel have announced such plans long ago.

Keep in mind, these are B2B (define) companies and not high-flying B2Cs (define). Plus, there are some B2Cs involved in some interesting things like Dunkin' Donuts' Facebook initiative or Southwest Airlines' great Twitter strategies.

These companies think digitally, act digitally, and really embrace principles of online marketing. It's not good enough to have an e-newsletter, run a few paid search ads, and redesign your Web site sometime over the past two years. It's critical to understand that it's competitive. Those that execute online marketing better will succeed; those that don't will quickly fall.

Consider these few principles that winning organizations embrace and culturally will make or break a company in the most trying economic times we've seen in two generations.

Principle No. 1: Be Willing to Fail; It's the Secret to Amazon.com's Success

Amazon.com CEO Jeff Bezos, in an interview on "The Charlie Rose Show" last week, discussed how Amazon.com became successful. One of his overarching tenets is being willing to fail and fail fast. Bezos admitted he's failed at numerous new initiatives. But, when he succeeded, he applied those learnings.

What does this mean for companies that aren't pure-play online retailers or those engaged in B2B? You can't move into a new area or change strategy and expect immediately to realize a robust ROI (define) and then base all decisions on that. If that happens, one is forced to be conservative and only do what is known to have worked. And that is nowhere near crossing the digital divide.

SEO (define) and social media strategies are the best examples. If you aren't willing to invest in determining the right strategy and balance of what's needed in these two areas, you can count the days down that your competitors will -- and the tremendous market share to be lost.

Principle No 2: Treat Your Web Site as an Asset or Capital Expenditure

Your Web site should be treated as the absolute epicenter of all things marketing. Every ad should have a URL; every direct mailer should have a Web-based call to action.

For instance, PBS asked viewers for $60 donations during a recent fundraising drive. I was on my laptop thinking, "All right, I'll pony up." And all PBS offered was a toll-free phone number. Who wants to call anyone at 10 p.m. and talk?

Lesson: if you don't have campaign-specific URLs on everything, then you're missing the boat. While most marketers use campaign-specific URLs, the real question is why we aren't paying more attention to the landing pages, microsites, and Web sites we send visitors to. Every marketing effort will either see a significant lift or decrease in its conversion rate even in long B2B sales cycles if you give the customer what they want. Also, make sure it's easy for visitors to find related items of interest on your site.

Still, folks are struggling for Web site budget. Many companies have made this a capital expenditure. Really, it's the cost of doing business.

So the marketing should control Web site investments, but the business operation must pay for it. Nothing will have a greater effect on your company's sales than its Web site.

Principle No. 3: Strategy Starts With the Customer

Yes, we all know this. We all preach this. We all hear this at every conference. But, how many really do this?

Let's go back to Bezos' interview. He was asked what makes Amazon so successful in the hyper competitive markets it plays in. His answer was shockingly simple: "Our extreme focus on serving the customer and reducing cost through operation efficiencies."

Amazon.com made ratings and reviews popular because their customers loved it. This was 10 years ago, before the rest of us started getting on the bandwagon.

Early on, Amazon.com had a one-click purchase system that made online buying simple. And it deployed a recommendation engine to suggest other books of interest before the words "behavioral targeting" were even mentioned.

We don't need to be pioneers like Bezos to be successful. All we have to do is look around us, learn from those succeeding, listen to our customers and be committed to crossing that divide before our competition does.

Meet Aaron Kahlow at Search Engine Strategies New York March 23-27 at the Hilton New York. The only major search marketing conference and expo on the East Coast, SES New York will be packed with more than 70 sessions, including a ClickZ track, plus more than 150 exhibitors, networking events, parties, and training days.

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ABOUT THE AUTHOR

Aaron Kahlow

After selling the Online Marking Summit (OMS) event company in 2011, Aaron is now leading the charge of the newest venture, the Online Marketing Institute - the leading eLearning platform and training destination for digital marketing education.

Kahlow is one of the most recognized thought-leaders in the digital marketing and social media space. Having founded, funded, and built three prolific and highly profitable digital marketing companies, Kahlow has also delivered hundreds of marquee keynote speeches around the globe. As a speaker, Kahlow is known for his inspirational style and plain-spoken nature where audiences always walk away feeling both motivated and educated. Aaron is a leading educator translating online marketing technology jargon into simple marketing and business terms. He is a recognized author, columnist (ClickZ, NYT) and authority on social media marketing, sales and marketing integration, demand generation, business-to-business marketing, search marketing, usability, analytics, and digital marketing strategy.

Named Metropolitan Magazine's "Top 40 Entrepreneurs under the Age of 40" Kahlow is also well known for his endless energy as an entrepreneur. Having built Business Online from three guys and a brother in a dentist office to BtoB Digital Agency of the Year; founding and selling the industry's premier digital marketing event, the Online Marketing Summit, and now on his third successful start-up, Online Marketing Institute, Kahlow is synonymous with building successful digital companies. Kahlow also has served on the Board of Directors and Advisory Board to many digital associations and media companies like the International Business Marketers Association, Search Engine Strategies/ClickZ, Microsoft/ BING Prof. Accreditation, Social Media Examiner, as well as many digital technology start-ups.

Today, Aaron can be found in his new home city of San Francisco, working on the global expansion of "Teaching the World Digital" in his eLearning technology venture, the Online Marketing Institute. Facebook and LinkedIn are his preferred places to connect.

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