SEO Basics: Backlinks
So you have a website, you added your keywords, your service area, your products, your contact details, a few graphics and now you sit back and watch the results … wouldn’t it be lovely if that were the case.
To gain high exposure in the major search engines, like Google and Bing, relies on a whole host of factors - the one we are focusing on today is Backlinks.
What is a backlink?
A backlink is a hyperlink from another website to yours.
This could be from your profile page in Twitter, Facebook or YouTube, or it may be a link from a suppliers or customers website.
Backlinks are a little bit like money - you never seem to have enough!
If asked for the optimal number for backlinks for a website I’d have to say how well do you want it to perform?
Google sees backlinks as one major indicator of site integrity - and it’s not just the number, it’s the quality as well.
Like the huge range of web pages found on the Internet, so too are the diversity of backlinks.
There are many forms of URL extensions such as .com, .edu, .org, .gov sites. There are OBL’s to consider, anchor text, pagerank and then the Do Follow or No Follow rule!
Sound confusing?
.GOV is a Good Surname
Let’s start with the URL extensions - every website on the web has a unique address called a URL (Uniform Resource Locator) which goes something like http://www.dlook.com.au. There can be no two website page addresses are the same – like a phone number – every page has be uniquely identified to ensure you get where you clicked.
In terms of understanding backlinks the focus is on the “.com.au” section (as shown in example) known as gTLD’s (global Top Level Domains). These consist of restricted and unrestricted domain extensions that are weighted differently by Google.
A gTLD extension denotes the type of page it is, the most common is .com (which includes .com.au as well as other country codes) and are given out for general use. More recently the .org extensions were classified unrestricted and fall into this category of general release as well.
However, .edu and .gov extensions are restricted gTLD’s and therefore less accessible. There are numerous restricted URL extensions but these two are the most common and typically are harder to get and so hold more weight in the eyes of Google.
Though backlinks are worth collecting, not all backlinks provide the same value … .gov and .edu extensions are much more desirable than the more common .com.
I Will Follow You
Websites may provide backlinks but they have the option of adding their tick of approval … or not.
Some websites choose to add the phrase “NoFollow” in their source code – which means the originating site does not endorse the link or, more specifically, it removes any search engine value from the link.
The link is still available to be clicked by real (human) viewers, but adding NoFollow has instructed the search engine that their site does not support the link.
The only way to check if a site provides Do Follow links is to check the source code of the website you are looking at.
So the best links are Do Follow backlinks … providing a full endorsement to your page.
Why Link Pages Don’t Work
Well, that’s not totally true. Though a single web page only has so much value to give out.
If we put a figure of 100 as an example … If you only have one link on the page then that link gets 100%. If there are two, 50 / 50. Five 20% each and so on.
The term that pops up often is OBL’s or other backlinks. When you run a search with a backlink checker it often includes a column denoting OBL’s. This is to highlight the number of other links that share the page with you - this could be a few to a few thousand.
So getting lots of No Follow links on pages with OBL’s numbering hundreds or more … well is possibly not the best use of your time.
Anchor Text Explained
Another key factor in integral backlinks is anchor text - this is literally the words that are used in the hyperlink. This text is given more value than the surrounding text - you’ve considered this important enough to use as your key words.
The text you use as anchor text should be the phrases or keywords that are most relevant to your page. Just writing “Click Here” doesn’t identify anything about the content. If your page is about shiny widgets then your link should be “shiny widgets”.
All Links Are Not Equal
Backlinks are not all weighted the same, we’ve already discovered that there are various extensions like .gov or .edu, there are Do Follow and No Follow and that OBL’s play a part … the final piece of the pie is Pagerank.
Pagerank is a Google patented algorithm that provides their view of a website’s integrity. The Pagerank (PR) score ranges from 0 through 10, with the majority of sites either unranked or achieving a PR of 1 or 2.
The higher the PR the less web sites with that score. At the top are behemoths like Google, YouTube, Facebook and Twitter then cascading down to the millions of websites that pop up each and every day.
A backlink from a PR4+ site is quite a coup … Add to that .gov and Do Follow and a few hundred of those would do me just nicely!
Reciprocal Links
Finally there are reciprocal links, where each site links to each other.
If you scratch my back then I’ll scratch yours!
If you close the loop on a backlink, providing an equivalent link from yours then this is also a good indicator of integrity.
Group Hug!
Well there you have it, an intro to forming a backlink strategy - like a giant virtual group hug.
The intricacy of linking and backlinking, reciprocal links forms a mosaic that all helps create relevance and site integrity.
The Backlink Shortlist:
- Create a lot of them
- Variety counts (.com, .edu, .org, .gov)
- Relevance counts too (anchor text, Do Follow)
- Be a backlink VIP (check the OBL’s)
- Look for the premium seats (Pagerank counts)
There are lots of ways to generate backlinks, hopefully this gives you a start on what to look for.
Trials of the Entrepreneur
Whether it’s Steve Jobs or yours truly, every entrepreneur has committed many mistakes and been victim to rejection and letdowns along their entrepreneurial journey. These arrows of misfortune, though agonizing, will teach you more about business than any coach, or guru ever could.
I’m no exception, I have learned a lot from my failures, and they have yet to kill me. This is an opportunity to share some knowledge I gained from my experiences. Without further ado, here are 5 tips (read as lessons) to survive the “entrepreneur fail test” that were worth confessing, once I survived them.
1. Success isn’t final
Despite how booming you are, understand that you may fall short again. ‘Loser’ tag is just fine as long as you’re ready to learn. It will motivate you to make wiser, enhanced assessments. The sooner you understand that your business has some beautiful and ugly parts, and there is such a thing as the “God Complex”, you’ll raise your stakes as a leader.
2. Keep in mind: No returns, no business
It’s as simple as that! Initiate a viable business for yourself, and not the one rooted in future skills or unreal investment. If your real business can make it, you will learn how to acquire other firms in the future or raise funding sources. But, relying on the latter path as a surefire tactic is just dumb and can easily backfire on your dreams. Upshot: Quit guessing about coming days from now, and laser-focus on present-day. Adopt, or perish.
3. Keep It Simple
As your business gets underway, and you think you can do more than a few things perfectly at once, well you’re probably not going anywhere. From PayPal to Google, everything stands out like a beacon today. These companies were developed by clear-cut plans, balanced budgets, and only then, did they expand. Keep your business/start up plan uncomplicated; because if it’s not easy, you’re doomed.
4. Be practical
You are an ordinary person attempting extraordinary things, As you are human, the mistake easily made is to believe your own nonsense, so be alert, stop conceiving you as a champion imagining your thought is brainy, and go motivate yourself better.
5. Think outside the box
Murphy’s Law in business is the likely scenario. If you predict 500 clients, you might get around 100. If you project a contract to seal within 10 weeks, it might creep up to 20. What I’m trying to say here is you invariably need to be prepared for these kinds of worst-case scenarios and have fitting backup plans for every circumstances. Don’t look at the problems with one solution in mind, commit yourself to think creatively. Extend yourself by brainstorming about options for every uncertainty and you’ll turn into a better business person.
Broken Links - End to End Networks
Can anybody define the term end-to-end network process visibility and its scope?
There seems to be a huge confusion in the market, as to what the term end-to-end network process really means. Is it one node forward in the supply chain (my customers) and or one node back (my suppliers), or is it multi-tiered (primary production to end consumer).
If it is the latter, then how do you gain visibility across your suppliers, suppliers - suppliers and / or your customers – customers - customers?
The extract from an economist article below gives an example of the compelling need for visibility across a multi-tiered network.
Broken links
The disruption to manufacturers worldwide from Japan’s disasters will force a rethink of how they manage production - Mar 31st 2011 | TOKYO | from the print edition.LAST year Iceland’s volcanic ash disrupted air transport across Europe and gave the world’s manufacturing supply chain one of its biggest tests since the advent of the low-inventory, just-in-time era. Now, Japan’s quadruple disaster—earthquake, tsunami, nuclear alert and power shortages—has put the supply chain under far greater stress. Three weeks after the massive quake, the extent and likely duration of the disruption are still unclear.
There are some enlightening similarities between the shocks that manufacturers are now suffering and those that buffeted the banking system in the 2008 financial crisis. In both cases two of the biggest surprises were the unexpected connections the crisis uncovered, and the extent of the contagion. The problems began in a seemingly well-contained part of the system—subprime mortgages in the case of finance, in manufacturing’s case a natural disaster in an economic backwater—but quickly spread.
This issue will not go away, no more than natural disasters will go away. If anything they will both increase in intensity.
We do indeed live in interesting times?
The Future of Employment
Article by Corri Byrne, dLook General Manager - Like dLook on Facebook
What are your plans for team expansion? Are you employing full time or on a project basis? In-sourced or outsourced? How is the employment landscape changing with technology?
Worldwide Changes in Employment
Government argues that we need more stimuli and the opposition argues that we need more tax cuts to increase demand. There is some truth in both arguments, but that’s not the whole story.
There is a restructuring going on in economies worldwide, jobs are moving to contracted people on value / relevance based terms; that are reviewed by project rather than traditional annual arrangements. Individuals are becoming more like actors / directors / producers and crew on movie sets.
The internet economy is ushering in a new wave of networked project based people working in enterprises with staggering capital values. Facebook is now valued near $100 billion, Twitter at $8 billion, Groupon at $30 billion, Zynga at $20 billion and LinkedIn at $8 billion. These are classed as US companies, when in reality they are becoming stateless organizations that are global in their reach.
While the company capital valuations are huge, they cumulatively employ less than 20,000 people. That’s not a lot of people, relative to their valuations, and while they’re all hiring today, they are largely looking for specific skill sets, suited to needs of “the movie” being made today.
The people resume of the future will call for people who have the critical thinking skills to do the value-adding jobs that technology can’t do, as well as people who can invent, adapt and reinvent their jobs (value) every day, in a market that changes @ NetSpeed.
Today’s college grads need to be aware that the rising trend in Silicon Valley is to evaluate employees every quarter, not annually. Because the merger of globalization and the I.T. revolution means new products are being phased in and out so fast that companies cannot afford to wait until the end of the year to figure out whether a team leader is doing a good job.
Employers or should I say Prime Contracting parties are asking of contract candidates: Can this contactor add value every hour, every day — more than a contractor in China, India, Poland or Russia? Can they add significant value to my prime contract position in the market place, can they adapt to my evolving role in the current project; and can they reinvent themselves for the projects of tomorrow? And can they become continuous self learning organisms that adapt to continuous market place change, so that as a federated group we can adapt and export more into the fastest-growing global markets?
In today’s interrelated, interconnected and intelligent networked world, more and more enterprises will evolve into these federated networks that will not hire sub contracting people who don’t fulfill those criteria.
This will require a new mind-set and skill set to compete. The uncertain, rapidly changing conditions in which entrepreneurs start companies is what it’s now like for all of us planning careers in a world filled by dynamic points of stability. Each point of dynamic stability has the potential to have a catalytic affect on all other points of the federated networks that we may become part of.
In accordance with the Chinese proverb “we do indeed live in interesting time”
Business Models Must Be Built to Adapt
In every market there are industry captains that excel at executing their current business model, that’s what makes them industry leaders.
However most of them slowly become hostages of the status quo, “the way we do things round here slowly morphs into the way we think round here”
History is littered with industry captains that lose out to start up companies who appear from nowhere, and in a few short years overtake the established leader.
A New Paradigm
Cloud computing is bringing in a new disruptive economic environment that will make these transitions occur @ NetSpeed.
This speed of change and market volatility challenges the sustainability of “business as usual” in many markets, placing enormous pressure on any individual enterprise’s ability to respond to market disruption in a timely manner, as most enterprises are now heavily reliant on a multiplicity of external supply partner relationships to produce and deliver their products and services to market.
What’s The Main Frame
Looking back at history, IBM in the 1960’s and 70’s dominated the mainframe computer market, and it did so very successfully against competitors like ICL (UK), Bull (France), Univac, Honeywell, Fujitsu and CDC.
IBM quickly achieved value keystone status within the ecosystems it competed in. IBM’s technology capability, capacity, service level availabilities, integrated sales channels and associated high cost structures were sustained by burgeoning mainframe margins. IBM’s cost base expanded as their enterprise structure grew to manage and support the strategic relationships they forged with their customers.
Their customers (usually large enterprises) were generally value keystone players in their respective ecosystems and also on the trail of sustaining their existing capabilities and capacities.
This capability and value sustaining model utilised by customer and supplier resulted in creating incremental innovations that maintained and improved the business as usual approach in the computer industry.
Consequently IBM largely missed out on the minicomputer market to new competitors such as DEC, Prime, Data General Etc. Subsequent to the minicomputer market, IBM misread the PC market by seeing the value opportunity in the production of PC’s rather than the associated operating systems and software services that supported them.
In the case of DEC and Prime, who had successfully led IBM in the minicomputer business, they completely missed out on the PC market.
The IBM PC division has since been sold to Lenovo (China).
Not Robinson Crusoe
The list of market failure examples is endless and applicable to any industry. All of the above quoted enterprises had the capabilities, resources and capacities to test the relevance of their strategy and value assumptions within their ecosystems; and respond to the disruptive challenges they faced. Yet none of them did so, they lacked the insight to recognise and adapt to change in their business ecosystems.
It appears as if incumbent market leaders throughout history spent their time gathering evidence to support the belief that their strategies, business models and supporting value assumptions were permanently relevant and sustainable.
Give Me the Life Raft
So what’s the lesson to be learnt?
All enterprises and their capabilities, strategies, value assumptions, capacities and availabilities within an ecosystem are dynamically interlinked with their ecosystem partners.
Existing capabilities, capacities and business models, are not permanent and profitable belief systems to be defended at all costs.
Hacking and Scraping through … Orwell’s Sensis
With the investment in competitive facilities provision now ceded to the new government monopoly of the NBN its frightening to look out a couple of years into the emerging content world and see what may become of the competitive content providers in the Australian internet market with Telstra and its resources now moving unfettered from the Google Schmoogle era to a content predator, preying on all the relative minnows in this growing internet on line advertising big pond. The Orwellian Telstra have announced they are going to take over the internet content space and build upon previously print focused Sensis all the bits they think will make it the online content world, a secret deal with Google, a deal with US Yelp for reviews and acquiring Quotify for SME quoting.
At dLook we also feel flattered by having the dubious honour of having our copyright content regularly hacked and scrapped directly by the Yellow Pages, Telstra Burwood IP 203.7.207.5 and then more recently hacked again which led back to the same Telstra IP block at Sensis YP. We assume we are not alone in having this honour bestowed and usually one would be forgiven in thinking that it could have been just an error. Hardly as for over 3 months now Sensis has tried and tried again and this persistence moves the hacking from an aberration to what is a clear and focused management strategy for entering the market using the whatever it takes philosophy. It looks more like the reported old News International principles that are now under much question in other places. Now hacking and scraping is not new and we regularly endure the hacking of the truly dumb people doing the same thing in a smarter way, but for them we understand that is a way of life … like hacking phones.
For Telstra to announce it is now going to take over the fledgling market in March 2011 and immediately start by hacking and stealing the competitor’s databases points to a disregard for the law and to a bleak minnow future when facing such a dominant non law abiding monopoly. Telstra brings already well documented significant market power into the sector with Bigpond, Foxtel and a raft of other ventures including Google. Telstra recently announced that over half its data capacity is now tied up with Google along with its special relationships. It is, of course, the dominant underlying facilities carrier and holds a dominant position in both internet transit and internet content sectors to say nothing of being the publisher of the White and Yellow Pages and the contract operator of the numbering system. Now all of these activities already have more than 50% of the markets they participate in and some well over 90%.
Competing with a Monopolist
Ahh … you may say … but that’s just competition and sour grapes. Competition is OK if you do not have to deal with a competitor who knowingly sets out to break the law and last time I looked hacking copyright content is a breach. Telstra seems to be doing just that whilst at the same time bringing all its gaming tricks from the old pseudo monopoly business into the wild west but relatively naive online internet business sector.
Just how we did arrive here in a new market when Telstra holds a number of Government licences and is supposedly subject to the purview of the ACCC ? Well it would appear that the ACCC is just looking the other way. Surprising, given the changes on foot but given its record, not really unexpected.
I fear the minnows cannot rely on the ACCC to be even able to define these new markets let alone work at a pace that could actually set out a competitive playing field before the minnows are no more. The on balance abandonment strategy and the record they have is seriously not flash … just look at mobile prices here and overseas to see what can be done and what can’t be done when the regulator is gamed and humbled. Telstra is also on record for running policies of deliberate breach and paying fines as a commercial strategy regardless of the collateral damage it inflicts to its competitors. Go figure.
Hacking and scraping is really ugly for the target as it has the double problem of creating duplicate data which can severely impact the hacked party if the data is republished from an alternate and often hidden site. Given the Google Telstra relationship it is of some concern that this may be an underlying motive and the future dims when an unchecked predator like Telstra is free to do what it likes outside the law to whomever. It’s now down to working out who is Snowball and whether the licensor will ever act.
Built to Adapt
Article by Corri Byrne, dLook General Manager - Like dLook on Facebook
Is your business ready for disruption? Upheaval? What are the things you can do to future proof your business? This article explores business models that are built to adapt.
Business Models need to be Built to Adapt
In every market there are industry captains that excel at executing their current business model, that’s what makes them industry leaders.
However most of them slowly become hostages of the status quo - “the way we do things round here slowly morphs into the way we think round here.”
History is littered with industry captains that lose out to start-up companies who appear from nowhere, and in a few short years overtake the established leader.
Disrupting the Landscape
Cloud computing is bringing in a new disruptive economic environment that will make these transitions occur @ NetSpeed.
This speed of change and market volatility challenges the sustainability of “business as usual” in many markets, placing enormous pressure on any individual enterprise’s ability to respond to market disruption in a timely manner, as most enterprises are now heavily reliant on a multiplicity of external supply partner relationships to produce and deliver their products and services to market.
Looking back at history, IBM in the 1960’s and 70’s dominated the mainframe computer market, and it did so very successfully against competitors like ICL (UK), Bull (France), Univac, Honeywell, Fujitsu and CDC.
IBM quickly achieved value keystone status within the ecosystems it competed in.
IBM’s technology capability, capacity, service level availabilities, integrated sales channels and associated high cost structures were sustained by burgeoning mainframe margins. IBM’s cost base expanded as their enterprise structure grew to manage and support the strategic relationships they forged with their customers.
Their customers (usually large enterprises) were generally value keystone players in their respective ecosystems and also on the trail of sustaining their existing capabilities and capacities.
This capability and value sustaining model utilised by customer and supplier resulted in creating incremental innovations that maintained and improved the business as usual approach in the computer industry.
Consequently IBM largely missed out on the minicomputer market to new competitors such as DEC, Prime, Data General Etc. Subsequent to the minicomputer market, IBM misread the PC market by seeing the value opportunity in the production of PC’s rather than the associated operating systems and software services that supported them. In the case of DEC and Prime, who had successfully led IBM in the minicomputer business, they completely missed out on the PC market.
The IBM PC division has since been sold to Lenovo (China).
Death is Part of the Cycle
The list of market failure examples is endless and applicable to any industry.
All of the above quoted enterprises had the capabilities, resources and capacities to test the relevance of their strategy and value assumptions within their ecosystems; and respond to the disruptive challenges they faced. Yet none of them did so, they lacked the insight to recognise and adapt to change in their business ecosystems.
It appears as if incumbent market leaders throughout history spent their time gathering evidence to support the belief that their strategies, business models and supporting value assumptions were permanently relevant and sustainable.
Lessons to be Learnt
So what can be gleaned from these cyclical trends:
- All enterprises and their capabilities, strategies, value assumptions, capacities and availabilities within an ecosystem are dynamically interlinked with their ecosystem partners.
- Existing capabilities, capacities and business models, are not permanent and profitable belief systems to be defended at all costs.
Whether you are dominating your market or a new entrant, it is important to maintain an adaptable business model, focused on the rapidly changing market conditions. Maintain an appreciation that your business is completely reliant on numerous external factors - all of which could significantly impact your market position, long term strategy plans or entire industry relevance.
Changing Habits of Google Search
Article by Mande Crnjak, dLook Account Manager - Like dLook on Facebook
How do you use a search engine? What are the words you type to find your page match? This article explores the world of Google search.
Google search. Searches in Google. Google Searching.
Everybody searches differently, especially when looking for a particular product or service.
The question is … are you searching your capital city? Your local area? Your local suburb?
All too often advertisers want to promote themselves as “Plumber Sydney” or “Painter Melbourne” when their real service area is just the Hills district or Mornington Peninsula.
When business owners are looking to promote themselves, they see the Internet as the opportunity to immediately tap unforeseen markets, hitherto unavailable customers - one’s who are just waiting to come across a Plumber in Penrith who will travel 45 minutes to service their emergency repairs in North Sydney.
As a business owner talking with your SEO company, web designer or online directory provider what are you asking them to optimise your page around. What are the keywords that you are trying to be found for and in what geographic area?
Keyword Searches and Suggestions
With the development of Google Places, the Google map and Google Instant (suggested search phrases as you’re typing), a search query is often being generated while you type and predictive results popping up to direct your thinking.
So while you are looking for a specific business or a particular product / service, you’re search words are being made up for you.
Are Google’s words really what you’re looking for?
For example, assume you are in a suburb in South Sydney and are looking for a carpet cleaner.
You go into Google, start typing in “Carpet Cle”… and before you even finish typing the rest of the word, Google has given you the options, “carpet cleaning, carpet cleaning Sydney, carpet cleaning Newcastle, carpet cleaning Wollongong, carpet cleaners, carpet cleaners warehouse”.
So you then click “Carpet Cleaning Sydney” as this seems the most relevant. But the results don’t meet your needs as “Carpet Cleaning Sydney” generates search page listings that are located on the North Shore, Western Suburbs or the Sydney CBD.
Are you going to choose one of these businesses? Or are you going to refine your search? So how often are we refining our search terms?
When searching for businesses which provide us with our desired product or service, we are all refining our searches because:
- We want to support our local community
- Our local suppliers often provide a quicker and more reliable service
- It’s easier to return the product or call back someone regarding the service if it wasn’t quite right
- We don’t have to pay travel costs like tolls, fuel, or be inconvenienced by the time to travel.
Extra delivery costs – additional postage & handling fees particularly when buying from online stores
You may be here in front of me, but how do I find you?
Depending on the type of product or service you are looking for, once you’ve done a local search to find a business do you make the call? Would you go in store to see their range of products for yourself?
So how, as a business owner, do you know if your customer has found you online via your website, your directory listing or social pages? How do you measure the success of your online brand?
Are we searching cities at all?
If you live or work in the city, you are most likely searching that city.
But let’s say you are searching for a restaurant. Are you searching “Melbourne”? Or would you type in “Melbourne City”? Or “Sydney CBD”?
Or would you even go as far as typing in “Italian Restaurant Lygon Street”? Or in Sydney “Thai Restaurant Oxford Street”?
These are the types of keywords people do use to search … so why aren’t business trying to optimize their pages, whether they’re websites, directory listings, advertising campaigns, around these words?
From the North to the South to the East to the West
When looking for a plumber I don’t need to know that it takes 45 minutes to get here - I want you down the road. Well I want you in my house asap and fixing my leak, my burst water pipe or whatever emergency has beset me.
If I’m booking you over the phone following a web search and then you explain that it won’t take long, but I will have to charge you for tolls … hey, give me a local plumber anytime. I don’t want the extra costs or the extra inconvenience.
More and more people are understanding how to use search engines and how to generate the results that suit their needs. It is becoming more specific in keywords and more local in geography.
If people live in the service area then they know how to search it … whether that’s the Hills district, north shore, Southeast Melbourne or the Valley these terms and specific suburbs are showing up with increasing regularity in search engines.
The development of cities which are now moving out in every direction, North, South, East and West, has not only urbanized search terms in relation to these areas, but also keyword searches like “Sydney metro” or “Adelaide Hills”. Are you using these types of keywords to gain customers from these areas?
If you own a business and are advertising online, whether it’s your own website, a directory listing or an online advertising campaign, consider where you want to service and the suburbs and areas that surround it and use these linked phrases and suburbs / areas as your primary search terms to get the best clicks for your buck.
Cloud Computing
Article by Corri Byrne, dLook General Manager - Like dLook on Facebook
Are businesses ready for Cloud Computing? Are we on the verge of a major corporate overhaul of systems, drivers and methods?
Cloud Computing is as useless as a Newborn Baby
A revolutionary new way of doing business is taking place. It started as information technology within business enterprises, and has now been embraced and extended by consumers. It is making sweeping changes to every aspect of today’s economies. It is radically changing the importance and speed of information communication for enterprises, individuals and demand / supply networks.
It is a revolution in network process dynamics, their creation, combination, bifurcation, recombination and patterns of behavior.
It is not being led by Chief Financial officers or Chief Information Officers, who introduced Management Information Systems (MIS) in large enterprises or technology vendors.
Consumer Driven Systems
It is being led by consumer driven dynamic networks (Facebook, Twitter, LinkedIn), who’s implications Business Information Industry leaders have in the past tended to ignore.
It is Cloud technology which is now beginning to be adopted by business and government institutions. Like a newborn baby, it presents society with open possibilities around the way we collaborate, cooperate and compete as individuals and groups.
Historically business operations were all about analyzing the year-over-year business model within the physical constrains of individual enterprises:
- Balancing capital, resources, work activities and customer service
- maintaining in-stock levels
- effective asset management and product assortments
However, customer conversion in retail is not just about setting-up a store or even a multi branded distribution network. Consumer preferences from product research to product purchasing has become multi-dimensional, it is now combined as a digital and physical experience and is geographically global in its reach. Sustainable business models must become aligned, agile and adaptive with their demand / supply value networks.
This entails orchestration, loose integration and coordination of clustered demand / supply network partners; digitally linking their enterprises, distribution centers, and business processes, into a seamless experience for the ultimate consumer of their products and services (the use of shared assets, combined business processes, social, mobile, voice, and video networks. and multi-channel retailing.
Despite the consumer / retailer relationship changing at net speed, bricks and mortar retailers have been unable to respond to this consumer led disruptive business model. Retailers are now compelled to manage product assortments and inventory across multi-brand, multi-channel and multi-distribution strategies, (what products to range, across which channels, what inventory to keep, when, where and how much to keep and distribute).
Demand / supply network partners must rethink how their combined operations interact, react, cycle and feedback to accommodate the new physical - digital retail selling environment.
Changing Consumer Shopping Experience
As Facebook, Twitter, LinkedIn, iPhones, iPods and iPads change the customer shopping experience - Demand / supply network partners need to understand how end-to-end network value is created, transformed, exchanged and consumed in this new environment.
All of these events are network driven and yet all computer business applications to date are enterprise (department) driven.
Vertical industry networks have a compelling need for dedicated real time network support (Cloud Process utilities that coordinate and manage people-to-people and system network-to-network dynamics) that cannot be predefined or pre programmed … the way that current system-to-system interactions are.
Connected Consumer
Article by Corri Byrne, dLook General Manager - Like dLook on Facebook
This article explores the Connected Consumer and why traditional marketing struggles to attain the penetration rates it used to.
Once upon a time consumers depended on retailers to access information as to which product would best answer their needs. However the advent of the web and social networks means that access to product information has been separated from the product and retail store.
In many cases consumers no longer depend on retail outlets for anything other than price comparison and availability. Now with software applications like Red Laser, consumers can use an iPhone to scan a bar code, then search online to find the best deal.
Rising Consumer Awareness
Increasingly, consumers are now better networked and more informed than many of the staff that are trying to sell to them.
When consumers choose to buy online, products are easy to identify, procure and pay for; service responsiveness and product fulfillment is just a click away, and product delivery can be tracked from source to home.
Consumers can also feel more secure in the buying decisions they make; because their purchasing decisions are backed up by online reviews, blogs, recommendations, peer support and advice that is simultaneously available 24/7. All communication is in English – or the consumer’s language of choice.
The real time process between online business and consumer is aligned, agile and instantly adaptive to market change.
This has brought about a gap out there in the market, between retailers and buyers. Retailers are using newspapers, TV and radio broadcasting in an attempt to reach buyers, and it just doesn’t work anymore.
Broadcast Spam - Consumer Filters
Buyers have too many filters available to them. Buyers can limit the content they consume by using caller ID to filter out unwanted phone calls, record television programs and skip through the commercials, or siphon off unwanted junk mail.
Consumers awareness of spam has crossed over to all forms of marketing.
Marketers assume a 1.0% response rate to broadcast marketing campaigns, which is fast turning out to be clearly ineffective.
The Dell System
Consider the worldwide manufacturing operations of Dell Computer. When a consumer designs their computer online, Dell beams that demand signal to its 30 tier-1 and 400 tier-2 suppliers scattered across the globe, they all work asynchronously, against their own clocks, using human and system resources in non-predetermined ways.
That solves the critical challenges in synchronizing the 20% exceptions that must be dealt with in real business— which consume 80% of resources—if an enterprise is to achieve a sustainable competitive edge.
Consumers can stay in touch with their purchase product’s journey manufacture through shipment to final delivery; and the consumer can continue to have ongoing direct relationship with Dell’s support desk without any retailer providing middleman assistance.
The retailer no longer offers any value add to the equation; unless the consumer requires finance.
The question then is how long it will be before finance is tied to online purchases?
Constantly Connected Consumer
The Universal 2008 McCann Report: Power to the People, Social Media Tracker stated:
- 57% of Internet users have joined a social network
- 73% have read a blog
- 34% post opinions about products and brands on blogs / social media networks
- 36% think positively about companies that have blogs
- 83% have viewed video on multimedia channels
- 184 million people worldwide actively maintain a blog
These figures are rising with each year … so where is the future for disconnected retailers?
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