G: Lets just think about how you interact with Google. You interact with Google when you are searching for a product, service or answer fast. Correct? Meaning that, those on Google are more engaged and therefore have higher intent.
F: Facebook, however, is different. How do you interact with Facebook? You interact with Facebook mainly, to pass time or connect with someone. This allows me to say, that Facebook users have less intent as to those searching via Google, since their initial purpose was not searching for a product, service or answer.
G: With Google, you may not receive a lot of ‘clicks’ as you do ‘likes’ with Facebook, but I am sure to say that those clicks are likely to be paying customers, which is why Google is going to charge more per click due to higher conversion rates per ad.
F: Facebook customers are generally more interested in knowing what their friends are up to, rather than purchasing a product or service. You may get a lot of clicks, impressions, or shares, but not a lot of paying customers, therefore you will have a lower conversion rate and Facebook will charge less per ad interaction.
G: Google limits its audience by language and geography, but the creation itself are from keywords that the targeted audience uses to find the specific product or service.
F: Facebook on the other hand, has a powerful tool for demographic targeting. Audiences can be built based on many factors, such as, gender, geography, interests, behavior, income level, employment, etc. Facebook allows you to make a ‘lookalike’ audience, in which uses your current audience and shows your ads to those who have similarities to your existing customers.
Bottom line is: Both Google and Facebook are powerful advertising platforms. Depending on your businesses needs and goals, you can determine which platform is going to bring you success. Businesses that are suitable for advertising through both Google and Facebook, have the ability to see the bigger picture as both platforms then complement each other.
There was a time when only authorities had information, whether that being doctors or car dealers. That time has now passed and its irretrievable.
What is asymmetric information?
I managed to read two books whist on vacation. Both books have been ‘staring’ at me from the bookshelf for quite a while, and both were given to me from a colleague after attending a book fair. Both books were written by brilliant people in their fields of knowledge and I truly recommend others read them too.
I will start my blog article with the book ‘The market for lemons’ written by George Akerlof:
In 1967, George Akerlof, a first year lecturer in economics at the University of California, Berkeley, wrote a 13 page paper in which, using theoretical economics and several equations he explored an area of trade that only few economists dared to enter; the used car market.
The first two professional journals whom Akerlof had offered his thesis to had rejected his work because they do not publish papers with that type of trivial subject.
And the third journal had rejected his thesis, but only with a different explanation; they said that the topic was mistakenly understood. Finally, two years after he had written his thesis, THE QUARTERLY JOURNAL OF ECONOMICS accepted his work and in 1970 it was published under the name “The market of lemons: Quality uncertainty and the Market Mechanism”.
Over time, Akerlof’s paper had become the most cited work in the field of economics in the last 50 years. In 2001 he was awarded a Nobel prize.
What was written only 13 pages in length, yet so important that it reversed the understanding of the world of market economy?
In short: Asymmetric information.
Akerlof’s thesis was already then (two years before two computers were even connected to the ‘network’) that the difference in information leads to disparities when in negotiating positions, it disrupts business relations and leads to the loss of the entire market branch in the long run. It often leads one or both participants to failure.
Why did businesses fail?
Having researched about the used car industry and because of the ‘asymmetric of available information’, Akerlof was able to determine why the entire industry was collapsing and how a lose-lose model had been established.
Used-car dealers were using only the information they were provided with for each individual vehicle, and this was information the customer did not know. Because of that, when under the pressure of profit growth, car dealers were displaying realistically lower quality cars as cars of higher quality just so they could sell it for a higher price.
This led customers to having less and less belief in car dealers. Some may have received bad reviews from others or even personally had a bad previous experience when they had intent in purchasing a used-car, so, when they were actually displayed with a good quality car, they didn’t believe the car dealer. They had lost trust. Customers try in all sorts of ways including bargaining and enforcing lower prices on purchases, because they believe they are purchasing a car of lower quality and believe that the car dealer is trying to ‘rip’ them off.
For some car dealers, selling lower quality cars for higher prices seemed like a ‘scam’ or the pressure of constantly having to lower prices led to reduction in earnings and then withdrawing from the business.
Over time, in the used-car industry, those that did not have an issue with selling someone a low-quality item, were the ones that remained in the business. As a result of this, an image was created that all used-car dealers were fraudsters. Buyers, on the other hand, put so much pressure on reducing the price or avoided buying a used car, that the entire industry stagnated and began to collapse.
Up until Akerlof, it was assumed that in the business industry, both parties act rational, which implies equal awareness. With Akkerlof’s explanation of a business failure in the used-car industry, he had proven the thesis that in the business world, decisions were not made rationally, but instead were made upon other factors. That had given a strong impetus to the new theories or the development of marginal areas in the observation of consumer behavior and the ways they purchase products or the behavior of competitors (Behaviorism, Game Theory). Akerlof has proven that the asymmetry of information harms the industry as a whole and leads to the decline of those who use their position of ‘authority’ based on the possession of information, which is unavailable to the other party.
In the used-car industry, the only car dealers left were the ones that had enabled their potential buyers with an insight on all gathered details of the vehicle, previous owner, policy and insurance company details. Eventually that had become a legal obligation in certain countries that had used the American example of how not to allow the collapse of an entire industry (e.g. Great Britain and Germany were amongst the first to legally regulate this from happening).
The question at the end is: What do used cars have to do with doctors or internet marketing?
There is a possibility that, that question popped up on your mind. In short, doctors exist (more often and teachers) that have complained to me about their patients (students) coming into the ordination (class) with scripts roughly ten pages in length of information taken from the internet about their condition (topic that they are interested in). There is an educated name for such patients – sent by dr. Google (or they asked prof Google).
They don’t understand that maybe their patients previously had some form of bad experience with doctors, and so are trying to reduce asymmetry of information. Therefore, before seeing a doctor, they wanted to inform themselves first on their condition. Doctors also participate in the sale process, and the quicker they understand that, the better for the profession. It’s also similar with teachers and professors. According to Daniel Pink, edu-med (education-medicine) the most conservative group of professionals that can’t quite seem to realize that they are also taking part in the sale process. They are sales workers, and their patients or students – buyers. If they express themselves as ‘authorities’ as they still believe there is asymmetry of information, they will quickly receive bad reputation and people will start avoiding them.
State of ‘authority’ no longer exists. The internet has changed that! Businesses or workers who hide information in order to maintain in front their competitors, will be the first to collapse in this world where information is available 24/7/365, or even via mobile devices or voice requests.
Thereby, it is unfortunate and unbelievable to hear that some Google ads agencies or internet marketing agencies don’t provide their clients with information regarding their google accounts or don’t give clients access to their accounts. I would suggest to these agencies:
Learn from the example of those who because of asymmetry of information have lost their race in the market and collapsed. Don’t overthrow yourselves as ‘authorities. There is no longer asymmetry of information.
What I had learnt in this field: Great results can only be achieved when cooperating with clients. No imposing, inflating or hiding knowledge. Quite the opposite!
If anyone is interested to know about the books I mentioned:
Google Ads and Analytics are based on metrics. Sometimes people get lost in all those numbers. Based on metrics we have a couple of tips on how to write an effective Google Ads ad.
As Google Ads has so many possibilities, sometimes we just play around with the campaigns, but what is common to all of this is that we aim to achieve maximum results through constant testing of campaigns and personalization.
We have learnt that we aren’t the only ones with that kind of approach. Jeff Bezos, founder of Amazon is known for always having an empty chair at his table when he’s at an important board meeting. That chair is reserved for the most important person in Amazon: For the customer! Thus, at a board meeting, each member of the board when proposing or deciding has a reminder that everything he does must satisfy the customer.
Measurement and pattern recognition are important
Sometimes some successful patterns appear, therefore it is important to make the time to analyze why some ads are doing better than others. By researching the success of Pixar, Michael Dolan found that successful films were made according to a pattern / algorithm that went something like this:
Once upon______________. Everyday________________. One day____________________.
Because of that________________. Because of this______________. Until______________.
If you watch the cartoon ‘Finding Nemo’, you will see that the storyline could be sorted out like this:
Once upon a time there lived a father named Marlin. He was very protective in regards to his son Nemo.
Everyday Marlin had warned Nemo of the dangers of the Ocean and begged him not to go further into the waters.
One day Nemo ignored his father’s orders and swam out further into the ocean.
Because of that, he was caught by a diver and ended up in an aquarium in a dental ordination.
Because of this, with the help of other sea creatures Marlin sets out to help Nemo.
Until Marlin finally found Nemo. They both learnt that love begins with trust.
I’m not stating that there exists an algorithm for a successful ad, but I do know that there are some rules / patterns of behavior which most often increase CTR and Conv. rate (e.g. curiosity is a strong motivator for a click on an ad or a grammar mistake made purposely. Forgive me if I don’t discover everything, but what I’ve discovered when writing ads, is that it’s not a bad idea to write at least one ad following these rules and guidelines / test against others:
Headline 1: Repeat the search term
Headline 2: Explain your USP (unique selling point/sales proposition)
Headline 3: Emphasise your USP
Description line: Put some numbers or dates and write a strong CTA (call to action)
Words are deadly
Just a few, small amount of words can make a huge difference, was proven by Rosser Reeves (The legendary member of the so called Madison Avenue, who coined the term USP – Unique sell proposition, was the first to advertise a politician, the first to introduce rhyme in an ad text). You can often hear stories from his life about how he helped a blind man.
During a lunch break, he and a colleague made a bet that he would help a blind man fill his cup for donations. The blind man had managed to collect only a few coins in a cup, as most passers-by were uninterestedly passing by him. Next to him was a cup and a handwritten cardboard sign that read: ‘I AM BLIND’. By accepting the bet, a colleague helped him realize one of the greatest urban advertising legends.
Reeves approached the blind man and introduced himself briefly. He suggested that he should add something else to the cardboard sign. As the blind man had agreed, he added what he wanted on his sign and went off with his colleague further away from the blind man just to observe passers. Not too long after, and the cup was full. Most passers-by were now stopping, making conversations with him and even putting banknotes into his cup. Are you asking yourselves what did Reeves add on the sign? Just 4 words: It’s springtime, and…
The new sign had now read: It’s springtime, and I am blind.
Presentation and personalization lead to performance growth of up to 80%.
For a long time, sales representatives were looking for people who could be described as extroverts. Research and measurements have shown that the best sellers are the ambivert people. (Adam M. Grant, Rethinking the extraverted Sales ideal: The ambivert advantage, Psychological Science, 2013). Extroverts tend to exaggerate and therefore they get on the customers nerves, and introverts are unable to extract the most important information, therefore they cannot solve any customer problems.
Add a personal verse – e.g. a photograph in your email
However, I would like to introduce to you a very interesting test conducted by a radiologist Yehonatan Turner (The effects of Including a Patient’s Photograph to the Radiographic Examination). Given the consent, he photographed 300 patients and placed each photograph of each patient with their x-ray examination, that was then further examined by his fellow radiologists (radiologists are probably one of those doctors that rarely or even never have actual contact with their patient). Radiologists said that they had felt more empathy for their patient viewing their x-ray examination because they had a photograph of the patient pinned to the x-ray. In addition, they found an abnormality, an accidental finding for patient number 81 that was not part of their goal in the primary search.
When he had given his fellow radiologists the same x-ray examinations after 3 months, this time without pinning photographs onto each examination. 80% of accidental findings were not found. Without a photograph of the patient, radiologists are less thorough and less precise.
Perhaps your clients may read your email more carefully if they had a picture of the person who is at least in the signature?
Google recommendations
Writing something about how to write good quality ads, and not include in my blog Google’s recommendations would be flawed. Whilst we at our agency don’t use all of those recommendations, especially not for new clients or for those that have a small feedback sample, I still believe that it’s not a bad idea to take and test some of the recommendations for successful ads because Google says:
– You must use a minimum of 3 ads per Adgroup
– You need to use all possible extensions (extensions raise the CTR about 15%)
– Ad rotation must be set to optimize for….
– The Attribution model for conversions is best when it’s data driven.
The effect of stories or how just a simple message can turn tables around
A good story or message can increase ROI (return on investment) by 32 times.
“Stories are such a powerful driver of emotional value that their effect on any given object’s subjective value can actually be measured objectively.” Joshua Glenn and Rob Walker
“When people are finding meaning in things — beware.” Edward Gorey
Significant Objects, a literary and anthropological experiment created by Rob Walker and Joshua Glenn, demonstrated how the effect of narrative on any given object’s subjective value can be measured objectively.
The idea first came to them by inventing a fictional story about an object and then listing it on eBay in order to determine the impact of words the story had on the objects value. And guess what? It did!
Phase 1: “Narrative transforms insignificant objects into significant ones”, written by Sheila Heti, Nicholson Baker, Lydia Millet, Colson Whitehead, Jonathan Lethem, and 95 others, was the first volume of stories to prove this hypothesis. The experiment was purchasing objects from thrift stores and garage sales for no more than a few dollars, writing a fictional story, in any style or voice about the object and then listing the object on eBay. The winning bidder is mailed the significant object along with a printout of the object’s fictional story. The results of the experiment? Objects bought from the thrift store for a total of $128.74 were sold for a total of $3,612.51, all of which went to Significant Objects volume 1 contributing writers.
Phase 2: Significant Objects second volume of stories, written by Kathryn Davis, Tom McCarthy, Amy Fusselman, Neil LaBute, Gary Panter and 45 others sold objects pinned with their stories and raised $2.244.11, which was donated to “826 National”, a creative-writing tutoring program for teenagers in seven cities. Third volume of stories written by Wesley Stace, Rick Moody and Heidi Julavits, raised $1,748.82 and was donated to “Girls Write Now”, a non-profit that mentors at risk young women in New York City. After that, they published a “week of epistolary stories”, guest curated by Ben Greenman. Money raised went to the non-profit lit publication “One Story”. Also published a week of stories leading up to their first ever live event and Object Slam, in San Francisco and donated the money raised to “Root Division”, the arts organization that hosted their event. Various phase two efforts raised $4,351.50 for worthy, lit-related entities.
Significant Objects evolved from a simple experiment into a thematic literary journal, using eBay as it’s publishing platform.
Bottom line: A simple word, sentence, paragraph, story, can make a tremendous difference in the world. It can change the way people look, characterize, feel, believe and interpret the specific object given.
Why am I telling you all this? It’s the same when writing an ad! Effective ads are written when there is a story behind the subject being advertised!
