The Idea Dude


Tuesday, January 30, 2007

The year of small biz ads

According to Businessweek, this may well be the year of small biz ads. It's always a challenge for small businesses to launch online advertising campaigns because they lack both the expertise and money to get the maximum bang for their buck. With large retailers with deep pockets buying up popular words and search phrases, it is becoming increasingly difficult and time consuming to find the niche words that are cheap and effective. Often it takes weeks if not months to fine tune your ad strategy which goes beyond just buying a couple of words. It's finding which words are condusive to click-throughs and when users do click what do they do on your site. No question, it's an art and many marketing/advertising companies make their living doing this. Again, small business can neither afford such services nor have the time to figure out what sticks and what doesn't.

Smacks of the long tail emerging in the ad space. As a technology becomes popular, the biggest and the richest are able to exploit it better than others creating imbalances and disparities in usage and benefits. Google and eBay (with their Skype acquisition) are starting to look at exploiting the long tail of small businesses through a relatively new and emerging twist called click-to-call. Instead of clicking through to a website that many small businesses cannot afford or have no time to maintain, the click makes a direct call to the business. The benefits are to both the consumer and the business. For the consumer, it means getting answers quickly without having to search and read numerous webpages. For the business, it is a direct engagement with the consumer. Couple this with location-aware advertising, you could end up calling your grocery store down the road about a special you just saw or use the coupon that's just been offered.

Given that 5-10% of the any long tail usually accounts for 50% of product (whether it is traffic, revenue, etc), saturation of the top minority means that the other 50% becomes more attractive. However the key is controlling cost and scaling because as the paradigm suggests, the long tail is traditionally extremely thin and inefficient.


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