It's All Geek To Me - September 22nd 2005

Precisely Calculated Guessing by Ross Lasley As most of you know, KISS is a company that is all about ROI. We've been at this website thing for a very long time now – we've sold sites for $99 and for $99,000 and the way we judge them has always been the same . . . the sales generated. A $100 site that has $150 in sales trumps the 100K site that has 50K in sales every time.

The web offers a plethora of stunning measurement tools for e-commerce, and used correctly they allow sites to get better and better every month. Highly detailed sales information used in conjunction with visitation info works every time – it might tell you your products are priced too high, or the market is not big enough, or other things you don't want to hear - but it works 100% of the time.

(the baste well Repeat graphic from the site or something similar should go here)

You probably know this, and you might even be aware that it isn’t simple or easy to make adjustments based on analysis of the generated data. We’re pretty darn good at that, and this ability is why our retainer clients smile when they write the check to KISS each month.

But what if you don't sell directly with your site and you have no shopping cart plans?

That's where precisely calculated guessing comes in. More than an oxymoron , precisely calculated guessing is also an analysis skill that needs to be developed.

Even if you don't sell products on line directly, your site allows people to sign up for your e-newsletter or get directions to your location or print a coupon – the specifics don't matter. There’s always something they can do at a good web site, and that something can be measured.

I know you can't calculate the total value of a new customer – but for the web you have to make a reasonable guess. Let’ say your guess is a new customer is worth 25K a year to your firm. That baseline figure, then, is used to judge the success of the site. In the first year you plan to generate one new customer per month with your site and your “guess” tells you this is worth 300K a year. You plan your advertising cost at 10% in your business, so your web budget should be $2,500 a month.

You probably will make several other guesses, too – an email address means you can communicate without printing or postage costs (and track response) – and those might be worth $5 each to you. This means your email marketing to that list of 1000 people must generate 50K per year in sales to meet that same 10% ad cost.

Here is the most important thing about your precision guesses – write them down.

Once per month, quarter, year – whatever is appropriate for your business – sit yourself down and do a bit of “back of the envelope” math. You'll be amazed how fast you find out you can profitably “pay” $8 for email addresses, or in fact new customers are worth more like 20K per year (sales by customer in the last month, new only, average the figures).
The reason you need to make precisely calculated guessing part of your analysis world is a simple one.

It is probable you believe that in 2025 the web will be a very significant part of your business. It is probable that you believe the web isn't (and maybe couldn't be) a significant sales channel now.

This is what most executives think and, frankly, I don't know what the heck they are waiting for. Perhaps they believe a lighting bolt will strike in 2017 at the precise moment they should “really” start working on the web to be ready for the 950K per year they expect in 2025.

Pssst – hey executives – it won’t happen that way. Like every other developing sales channel you've dealt with, spending will increase in a nice, gradual curve that you'll struggle matching to the sales curve, just as you've been doing for years.

The web is no different than any other sales channel except in its inherent ability to be precisely measured. Even if you don't have a shopping cart, a few precisely calculated guesses will let you have wonderful ROI from your site starting now – and you'll be ready for 2025.

VOIP Opens Door to New Type of Communication by Josiah Cole During a recent phone call with one of our clients I asked if they use Instant Messaging to coordinate their scattered team of employees. They replied that they used mostly email and the phone, and didn't yet use Instant Messaging to communicate. At KISS, we use Instant Messaging every day, not only to communicate with our employees across the country, but also to send quick notes and information back and forth to the people here in our office.

Now, our desks are probably no more than 15 feet apart so you may be asking “Why bother with IM when you can just get up and go TALK to the person”. The answer to that has two elements. The first element is based on the type of communication we use IM for, IM allows us to send not only pure conversation messages but also information. If Michael needs the username and password for one of our accounts, or if Desiree finds a really great website and wants to send me the link, sending that information via IM is much better than writing a note down and much quicker than sending an email. The other advantage that IM offers is that it's less intrusive then walking up to someone's desk or calling them and asking for attention or time.

What this makes me think of is the different communication mediums we have now, and what ones are on the horizon. Moving in order of innovation, there's the face to face meeting, a “snail mail” letter, a regular phone call, an email and an instant message. Obviously a face to face meeting is the most time consuming and intrusive to a productive work day, followed by a phone call, instant message, email and then finally the old and trusted snail mail message (which can be ignored for days and you can always blame the USPS for slow delivery)

What we see on the horizon is a re-invention of the traditional phone call, when it relates to a business team communication scheme. VOIP or Voice Over IP is enjoying much publicity as of late, services provided by Vonage, Comcast, AT&T all deliver phone messages over your broadband connection, and use your regular phone to place the actual calls. The other side of this market is the all digital VOIP providers which provide mostly free calling to other VOIP customers by using your PC. Skype, Google and Gizmo are all innovating in this area and continue to release new and improved products that attempt to sway people away from the traditional phone and into a world where a phone conversation is a purely digital affair. The technology, business strategies and software is not the part of this that interests me however. Michael Robertson, CEO of SIPphone and Gizmo recently shared a very interesting statistic in an interview with gadget and technology blog Engadget.com. He was asked what effect an always-on, always connected infrastructure would do to society and communication. He replied by saying the following:

“Already we’re seeing today where people will open a voice call and leave it on as sort of a virtual office. They’ll leave an audio channel open between two friends or colleagues and they’ll pick up conversations whenever they’d like. ‘Hey, Bob!’ and Bob will go, ‘What?’ So the notion of picking up a phone call or hanging it up kind of goes away, and you just decide where you want to connect it to. We’re already seeing people make calls that last 7 1/2 hours. They’re not talking for 7 1/2 hours, they’ve likely got two speaker phones and they leave the connection open for when they want to talk. It’ll definitely bring people closer by having virtual voice connections that just stay on 24 hours a day.”

This of course reminded me of Instant Messaging and what it did to the email world. This will expose my age but when I began to really use computers and the Internet, I rarely used email as I saw Instant Messaging as much more efficient and easy to use. When I began my work for KISS 5 years ago, I began to use email as it's a requirement in today's business world. What ICQ, AOL Instant Messenger and MSN IM did to email, Gizmo, Skype and others will do to phone calls. Just imagine being in your office or in your home, and having most everyone you know, or a select few people be available to have a conversation at any time. You may be thinking “No way, too many distractions!” But think about it, if you have a team of co-workers, or maybe a few really good friends, the power of having them simple a “Hey” away is amazing. These days we pay our phone bills and worry about long distance service and how many cell phone minutes we've racked up in the past month. These VOIP services are tearing down these boundaries and allowing an open FREE dialog to take place. Combined with the right hardware (microphones, speakers and broadband) and software (a computer that would allow you to “ignore” incoming messages or “hide” your online status to your group just like IM), VOIP and always on phone connections could add yet another revolutionary way of communicating to our society.