SMS: Online

Canadians shy away from purchasing online

Thu, 04 Jan 2007 01:28:20 GMT

I came across an interesting article over the holidays on how Canadians are not purchasing as much online as their US counterparts. The article was published on the Globe and Mail.com and it got me thinking about my recent experience with the Best Buy website. The article talked about how Canadians are definitely browsing for merchandize online but do not seem to purchase them online. The article quoted a survey that indicated that two-thirds of all Americans would shop online but only one-third of all Canadians would shop online. Basically, Canadians like to browse and educate themselves online but then decide to head into a store rather than make the purchase online. Given our broadband penetration, I thought that Canadians would be more willing to shop online then their counterparts south of the border. There are numerous reasons listed in the article to explain this trend, major retailers such as Wal-mart do not offer e-commerce on their website, shipping durations are far too long and shipping costs are too high. However, I think the article has missed a couple of key points on why Canadians are hesitant to shop online.

I think the user experience while purchasing online is a key factor that has been over looked by the article. Websites operated by retailers such as Canadian Tire, Best Buy, Future Shop, etc do not make it easy for you to purchase an item. The process is cumbersome and slow at best. The sites are not fast, the layout is not user friendly and actually paying for your purchase is the most tedious part of the whole experience. Retailers have also instituted such strict fraud prevention systems on their Websites that it actually deters people from buying online. Future Shop and Best Buy have one of the most tiresome fraud prevention systems that I have ever come across. If your order is flagged by their system, you have to call their call center from the same number that you is entered on your profile. This makes it impossible for anyone who is traveling or on vacation to successfully buy anything if their order has been flagged. This happened to me last year when I bought a TV from Future Shop and their customer service rep called me and asked that I call her back from my home number. I was traveling in the US at that time and was not returning for another 2 weeks. They kept my order in pending state for 2 weeks and it basically took me close to 4 weeks to receive the TV. Retailers pay a lot of attention to the client experience in the store and spend hours agonizing on how to merchandize items in the store itself, however they can do much better when it comes to their online presence.

A great user experience is key to the adoption of any technology not only e-commerce. Folks in the wireless industry predicted that data revenues would sky rocket as a result of the Internet browsers on your phones (WAP browsers), the launch of SMS and MMS services,etc. People would be taking tons of pictures and videos and sending them to people through their phones thus generating data revenue. Wireless carriers have realized that the user experience on a WAP browser pales in comparison to the browser on the desktop, thus people are not willing to use the browser on their phone unless its absolutely necessary. The phone manufacturers have focused too heavily in the past on integrating MMS technology in the handset but have not spent enough time integrating the functionality on the phone with the carrier's network. It is easy to take a picture or capture a video clip but it is very cumbersome to try to send it to anyone else using your phone. Carriers are now focusing heavily on the user experience in its entirety to try to drive up adoption of data services. Now that I have gone off on a tangent for a bit, let me get back to online e-commerce.

Selling online allows the retailers to avoid costs related to sales commissions and the operation of their brick and mortar stories. However, they are not willing to pass these cost savings to online shoppers. If anything, they are penalizing the folks that are willing to shop online by charging them excessive shipping fees. Tactics by retailers such as Future Shop during this past holiday season clearly prove my point. Future Shop started charging shipping fees for any items purchased online during their Boxing day extravaganza. They generally don't charge for shipping item to a store, however started doing that during this Boxing day sale. To add insult to injury, they didn't clearly notify customers that they would be charging people shipping fees, when items are being shipped to a store close to them. This type of activity has resulted in Future Shop being lambasted on communities such as Red Flag Deals. Costco.ca is another site that has great deals but charges a lot for shipping any items that you have purchased. If anything, shipping for any items purchased online should always be free and the cost of the item should be lower than the in-store prices. If Internet based banks such as ICICI, President's Choice and ING can transfer cost savings to their clients in terms of no user fees and higher interest rates for savings accounts, then why cant the retailers pass on the cost savings to online shoppers? It seems like Canadian retailers and merchants with an e-commerce presence on their site are not serious about attracting Canadians to buy online.

The fiasco that is Best Buy's online Boxing day sale

Tue, 02 Jan 2007 21:12:39 GMT

Being an avid reader of Red Flag Deals I was expecting all the dirt on the best Boxing day deals in town to be on the site. Needless to say I was not disappointed, the good folks at Red Flag Deals also managed to post previews of most of the flyers before they were actually available in print to the general public. Best Buy had a great deal on the Logitech Harmony 880 Advanced Universal Remote Control. This was a web only deal. The remote control sold for $299 usually and was on sale for $99. This was not a necessity by any means but at that price, it was a great deal and as one of my colleagues had mentioned, I was on the prowl for a great deal. :)

Best Buy had sent out an email to everyone that subscribed to its mailing list letting them know that the Boxing day sale would start on December 24th as 8.00pm EST. They indicated that the site would be down for a few hours, and would be up at 7.00pm EST for browsing. They also mentioned that they would clear everyone's shopping carts to ensure no one had an unfair advantage. At 8.00pm EST, the flood gates would be opened and the bargain hunters could go nuts. My friend Puneet and I were ready in front of the TV relaxing, with our laptops ready to go shopping for some Logitech remote controls.

At 8.00pm sharp, we entered the site and needless to say things started going downhill. The site was barely up a few seconds past 8.00pm before it was overwhelmed by bargain hunters causing a huge spike in traffic to the site. The site started crashing and would not let me in, fortunately for us Puneet had gotten in and had added a few of the remotes to his shopping cart. The site crashed while he was checking out and I felt our remote controls slip away. After multiple attempts, we managed to get in to the site but now we couldn't add the remote controls to the shopping cart. A few more minutes went by and we tried again, however the remote controls were sold out at this point in time. I was not surprised as the Best Buy website is always a disaster during the first few hours of their Boxing day sale. I was disappointed though, as I had hoped Best Buy would have learnt from past mistakes and would have planned for the spike in traffic to their site. Maybe they did plan for it, but they didn't do a great job at planning or executing as their website was up intermittently for the next 2 hours.

Not to be deterred by the events of that had taken place on their site, Puneet called up their website support line and asked the rep to honour the deal and provide him with a Logitech remote at $99. Puneet patiently explained what had happened and the rep acknowledged that the site had been down, yet indicated that he was not empowered to provide him the item at the lower price. Puneet soon found out that speaking to a supervisor didn't help either. Based on the various posts on Red Flag Deals and various IRC channels, we knew that Best Buy had upset a lot of people. Best Buy basically refused to help out the hundreds of people that had been disappointed as a result of their poor execution on their website.

Later on that night I reflected on what had happened on the Best Buy website and it got me thinking about the self inflicted damage to the Best Buy brand. Companies are paying lots of money to attract, engage and delight the influentials and early adopters in their industry. Companies are not only investing in mass marketing tactics but are also targeting influentials who can be their ambassadors in the market. These influentials are the focal points of their social circles and people turn to them for advice on everything related to the industry. The members of Red Flag Deals are exactly that, early adopters and influentials. They pride themselves at sourcing the best deals and are recognized for it by their network. If there is a group of people you don't want to upset, its the members of Red Flag Deals. In addition, early adopters of technology are probably shopping online and Best Buy had also upset this sub segment of the market as well. To add to this, it is more cost effective for Best Buy to sell items via its website as they don't incur any costs related to sales commissions, which are paid for items sold in the stores. I understand that websites can be bought down by a huge spike in volume, however the companies that have a good customer support process in place can endure these unfortunate incidents. It boggles my mind that Best Buy continues to disappoint key sub segments of its target base year after year. They face a lot of heat from their customers but their level of service does not seem to improve with each passing holiday season. I guess poor customer service is a luxury they can afford given that they are one of the biggest electronics retailers in the country. Poor experiences such as this, just adds to the multitude of reasons why I don’t like to shop at Best Buy.

Blogs, a marketers' secret weapon

Wed, 22 Nov 2006 02:25:11 GMT

I was reading Mitch Joel's blog and see that he is hosting the seminar on how marketers can leverage Blogs. The seminars are offered by the CMA. I have attended the seminar earlier on in the summer and it is a great crash course for people who do not know anything or very little about blogging. As I work in the online industry and am surrounded by bloggers, I found the course covered a lot of material that I already knew. Regardless, I think the course is great for people who are considering Blogs as a marketing tool. I like the way Mitch has structured the course, it allows for a lot of discussion and dialogue during the day. People love that about the course, it allows them to engage in conversations about how they should join the blogosphere given their unique situations.

WOMMA publishes ethical blogger contact guidelines

Wed, 22 Nov 2006 02:24:41 GMT

A friend of mine sent me a link to ethical guidelines for contacting bloggers. The first draft of this document has been developed by WOMMA - Word of Mouth Marketing Association. I was surprised by the fact that there existed a WOMMA, and the fact that WOMMA was being very open to the community, they are accepting feedback on the guidelines from anyone. It is interesting to see the level of discussion and feedback they have received on the guidelines published to date. I would recommend anyone that is thinking of developing a blogger outreach program or contacting a blogger to review these guidelines, it cant hurt. The guidelines do sound more like an oath in my opinion.

Dell enters the Blogsphere

Wed, 09 Aug 2006 04:19:36 GMT

Dell seems to have taken the bold move and entered the blogsphere with the launch of Direct2Dell. Kudos to them for taking this step in trying to communicate with their customers that frequent the blogsphere. I was reading through some of the posts and it is quite apparent that Dell has setup a community blog. Different people within Dell are contributing to the blog and the topics of discussion are being altered based on the comments received on the blog. This shows commitment at various levels throughout the organization to this blog and addressing the audiences in the blogspshere. Dell is being very transparent about how they are running the blog and moderating the comments being posted on it. I am quite impressed with how responsive Dell is being in resolving some of the customers issues that are being discussed in the blogsphere and on their blog. Their VP of Customer care has authored a few posts on the dismal state of their customer service and what they are doing to improve the situation. I wish the Direct2Dell team the best of luck and will be visiting their blog from time to time

Who fed Google 1000 pizzas?

Tue, 08 Aug 2006 13:19:18 GMT

Answer – Cambrian House. I came across this video on YouTube about a company feeding Google employees 1000 pizzas. The video seemed interesting, so I sat through the 9 minute video and now I was curious to find out more about the company that decided to incur this expense.

I checked out Cambrian House and discovered that it is one of the very few companies which has based its business model entirely on Crowdsourcing. Crowdsorucing as defined by Jeff howe on his blog and in the article he authored for Wired magazine in June, “represents the act of a company or institution taking a function once performed by employees and outsourcing it to an undefined (and generally large) network of people in the form of an open call. This can take the form of peer-production (when the job is performed collaboratively), but is also often undertaken by sole individuals. The crucial prerequisite is the use of the open call format and the large network of potential laborers.”

Crowdsourcing has existed for a while in many ways, shapes and forms, however it is starting to gain popularity with the advent of web 2.0. Wikipedia is one of the best known examples of crowdsourcing. Other firms such as P&G and Amazon are also leveraging corwdsourcing to resolve business issues that they are facing. Crowdsourcing is an interesting phenomenon, however, there are associated risks e.g. ownership of the intellectual property for the solutions that are developed for a company that is participating in crowdsourcing.

Coming back to Crambian House, the Calgary based company whose business model is solely based on Crowdsorucing (which is similar to the concept of open source). From what I gather they are basically a technology marketing company. They solicit ideas from armchair innovators all around the world and then get the online community to vote for the best ideas. The best ideas get picked and again, they rely on their community to build and test the solutions. They are responsible for marketing and selling the product. Profits resulting from the sale of the innovation are shared with the individual that submitted the idea. They have already released their first product in beta. I have reviewed their website but I am still not sure who is responsible for supporting the application that is built by the community and sold by Cambrian, is it Cambrian or the community. I think the company needs to be more clear on this aspect of the go to market plan. Regardless, I commend these guys for having the courage to base their business on the collective expertise of the online community and developing a way to reward that community for their expertise. The company has also setup the National Viking Association (NVA) which is dedicated to honouring people and organizations that have “changed the world in a way that Cambrian House admires” (this is nothing by a pure marketing ploy in my mind). Keep a track of their blog for the latest happenings at Cambrian House.Incase any of you are still wondering why the folks at Cambrian House fed the Googlers 1000 pizzas, just check out the video on YouTube

Technorati Profile

Fri, 04 Aug 2006 19:53:50 GMT

Technorati Profile

Hi, you have 2 death alerts waiting – what a morbid use of social networking

Wed, 02 Aug 2006 17:43:44 GMT

Eons, a social networking service aimed at the 50+ launched this week. We have all seen tour companies specialize in vacations for the elderly, its no surprise that there is a social networking service that targets the same segment. The service is actually a hybrid between a social networking site and a content portal. The service has some traditional social networking features such as, profile creation, blogging capability, chat rooms based on common interests, etc. The unique thing about the service is that is also hosts a lot of content that is not generated by its own community. They have articles, games, puzzles, etc on their site as well.

Some of the cool features of the site (dare I use the word cool when describing Eons), are the fact that it allows you to set alerts that will notify you when someone passes away, it has a longevity calculator, brain games, etc. I think it’s a fun site for someone over 50, however I am not sure how many people over 50 will want to spend hours in front of a computer rather that interact face to face. In addition, as they grow older, their eye sight will deteriorate, which again takes them away from the computer. Stats do say that the seniors in Canada and the US are increasing significantly, hopefully that will result in this service becoming a permanent mainstream site, rather than a niche offering that lasts for a few years.

MySpace & other social networking services could be banned in US schools

Wed, 02 Aug 2006 17:40:35 GMT

The Deleting Online Predators Act (DOPA) was approved in the US House of Representatives last week. This resolution, although it’s not a law yet, would require US schools and libraries to block social networking sites and chat rooms.

If the DOPA act becomes a law most social networking sites, such as MySpace, MSN Spaces, Friendster, Hi5, YouTube, Bebo, etc will be banned from schools & libraries. This is being done to reduce the chances of children falling victims to online predators that visit these sites. I believe the intent here is good, which is to protect the children and help keep them safe online. However, I do not think the US government is taking the right approach in banning these types of sites. The forbidden fruit is always sweeter, thus banning these sites might result in kids secretly spending more time on these sites. Firstly, kids with computers and an internet connection at home will be able to access such sites and will probably not talk to their parents about it as they will be visiting a site that is banned. In addition, such a rule will also penalize kids that do not have a computer with an internet connection at home and will not allow them to participate in the latest social trend, social networking.

As with any technology, there are people leveraging it in good and bad ways. Most people are using such social networking services to meet people and enhance their social network and experience. There are isolated cases of such services being used by online predators who are targeting kids. I think the DOPA act is a bit extreme given that a select few are misusing this technology.

The right way to tackle this situation is through increased end user education and leveraging technology that makes it tougher for strangers to contact kids. Working with kids to help them better understand how to be safe online will yield more benefits in the long term than a full out ban. Leveraging technology that makes it tougher for strangers to contact kids will also help ensure that kids can experience the phenomenon of blogging and social networking without the associated danger. This will also help parents feel comfortable in giving kids their space when it comes to building and interacting with their social network.

Lets see if the DOPA act actually becomes a law.

Portal IM services get upgraded

Sat, 29 Jul 2006 05:03:44 GMT

The IM space is getting very interesting. Yahoo & Google both announced upgrades to their respective IM services. Yahoo Messenger Ver 8.0 has been released and is out of beta. Yahoo indicates that over 180 plugins have been created for the service since they released their platform last month. A quick feature comparison between Windows Live Messenger and Yahoo Messenger Ver 8.0 is available on Tech Crunch. The upgraded version is also available to Canadian users.

Google also started testing some new features for their GTalk service with a subset of their beta users in the US. They are adding some functionality such as free voicemail and displaying the song that you are listening to with this build. These are not earth shattering features by any means but indicates that the folks at Google are working on improving their IM service.

All these improvements are great for consumers and I cant wait for what else in store as the IM sphere heats up.

Canadian Internet advertising revenue grows by 54% in 2005

Thu, 27 Jul 2006 13:40:35 GMT

2005 was definitely a good year for the folks in the online ad business, the industry has grown by 54% over 2004 to hit the $562 million mark. This figure has surpassed the IAB’s (Internet Advertising Bureau) previous projection of $519 million by 8%. I am surprised that the IAB is forecasting a 43% increase from 05 to 06 in total ad revenues; I wonder why they are forecasting a decrease in the growth rate.

Given the number of Canadians online and the time spent on the internet, its no surprise that advertisers are spending more money online. I feel that given the reach of Canadians on the internet, this number should have been higher. Given that Canada is approx 1/10^th the size of the US and we have a larger percentage of the population is online (62% in Canada VS 57% in the US), the ad numbers should be higher. The US online ad spend is at 12.5 billion in 2005 while Canada only pulled in 1/25^th that. Canadians are spending more time online and hopefully the ad dollars will follow. Its all upside from here on in.

The most influential authorities on “blog marketing”

Wed, 26 Jul 2006 21:47:45 GMT

I read an interesting post on the most influential authorities on “blog marketing”. What caught my eye was that the Twist Image blog made the list and was in the same league as some of the big hitters like Wired, Seth Godin, etc. Good for Mitch, this is awesome recognition for his hard work. The blog details the differences between popular blogs and influential blogs. There is a detailed paper on how they this research has been conducted. I am glad to see that someone is starting to analyze the investments corporations and people are making in blogs and trying to provide some methods to measure ROI. However this also leads to another ROI discussion in mind, does a company want to communicate with people who have popular blogs or influential blogs? What if their blogs are not as popular as they are influential? I have to mull this around a bit, but my gut tells me that it will depend on the situation that the company is in and what they want to accomplish through this interaction.

How real is the online world?

Mon, 17 Jul 2006 13:01:35 GMT

I ran into a friend on the weekend and as people usually do we started chatting about some of the great deals we had recently come across. He talked about how he found a lot of great deals on RedFlagDeals. I was aware of the site and had visited it a few times, even found some good deals that I had taken advantage of. We got talking about what makes RedFlagDeals so successful and soon realized that it was the fact that people in the community were contributing content. User generated content, citizen journalism, couch experts are all terms that have come around because technology have made it possible for people to share their thoughts, view points and expertise with the rest of the world. The popularity of blogs and sites such as YouTube are clear examples of that.

We are all consumers of user generated content and news in some way, shape or form. Even the people that are not online meet their friends in person or on the phone and talk about world events or happenings in their local community. These people also consume user generated content. A risk we run in consuming user generated content is that it might not be valid (intentionally or unintentionally). In the blogsphere, a person has to earn their stripes and build credibility before they can boast a loyal readership. The same applies for any property in the online space. Online communities such as RedFlagDeals are successful because there is a level of trust between all the users. People are willing to share the cool deals they have come across and want to ensure they are as detailed in their posts so they can build credibility in this world. Trust in the people contributing to and trust in the content on the site is what makes them successful.

I feel people are less likely to trust someone they have met on the street that is offering them a great deal but what fascinates me is that we are willing to trust someone that is posting online. I was given a reality check as a result of my friend’s recent experience, He had heard a lot about RedFlagDeals and decided to peruse the site to see what the hype was all about. He found a great deal on Wonderland season’s passes and decided to buy them for his family. The person selling them had been posting items for quite a while and did not seem to have any blemishes on their record. He contacted the person, met them in a mall and purchased the passes. Imagine his surprise when he got to Wonderland with his family and was escorted into the security office, only to be told that he was carrying passes that had been purchased using a stolen credit card. He was thoroughly embarrassed in front of his wife and kids and also ended up losing approx $300.

What fascinated me about this experience was that he was willing to buy these passes from someone he had never met just because they had posted them on RedFlagDeals and the seller was part of this online community. I asked him if he would have purchased them from some guy he that approached him on the street, he scoffed and said no. Funny, isn’t it, that we tend to trust people in the online world more than we do in “physical world”. I am guilty of this myself at times. We have to start realizing that the online world is the real world and there are bad people that are willing to damage the trust that has been developed by numerous sincere users on communities such as RedFlagDeals. These folks represent a threat to credibility of such online communities, however this is no different than a bad sales person in a major department store that can ruin its reputation by being rude or unhelpful. We have to start treating the online world and communities with user generated content with the same level of caution we exercise in other parts of our life. Regardless of online or offline, if the deal sounds too good to be true, then it is exactly that, too good to be true!

Microsoft & Yahoo! announce IM interop

Fri, 14 Jul 2006 13:03:13 GMT

Microsoft and Yahoo! announced limited beta trials of interoperability between their respective IM solutions. This marks a significant milestone for the industry, the companies involved and of course the people that use Windows Live Messenger & Yahoo! Messenger. This is a great example of coop-petition, where two competitors come together to collaborate on a particular initiative.

Yahoo! Messenger users can finally chat with their friends on Windows Live Messenger without signing up for a separate account. Both the companies announced this limited beta in the following 15 countries; Argentina, Australia, Brazil, Canada, China, France, Germany, Hong Kong, India, Italy, Korea, Mexico, Netherlands, Singapore, Spain, Taiwan, Turkey, the United Kingdom and the United States.

This is good news for the industry as people expect the IM market grow as a result of this interoperability. You, remember the time you could only send a SMS to your friend only if they were on the same wireless network as you. Since the carriers launched inter-carrier SMS services, the SMS traffic has grown as more people are texting and they are also sending more messages to one another. Each company hopes that the entire IM market will increases as a result of this announcement. I am not sure that the IM category will expand significantly in Canada as a result of this announcement. 95% of Canadians using an IM solution use Windows Live Messenger or MSN Messenger (May 2006, comScore Media Metrix, All locations), I am not sure they will be inclined to change to Yahoo! Messenger suddenly. I see people consolidating multiple IM clients into one application on their desktop. The IM client that has the most number of contacts on it, will be the one that will remain on people’s desktop. It’s a hassle to move all your contacts from one buddy list to another and people will choose the path of least resistance.

I think this is a bold move for both companies and is a clear indication that each company is confident in that they can win based on the feature set of their respective clients. In addition, I feel this is a move that both companies had to make as they have been feeling the pressure from consumers to breakdown the walls between each IM community and implement interoperability. This is similar to wireless number portability in the mobile space. This move will ensure that the IM service with the best feature set, user experience and the one that demonstrates the best value will win in this space. This should lead to increased innovation at a faster pace as both companies vie for more users and work hard to retain their existing users. This can only be good news for consumers who will benefit from this increased innovation. This is another great example of how increased competition benefits consumers and moves technology ahead by leaps and bounds. We should see a similar phenomeon in the Canadian wireless industry as soon number portability is launched.

At the moment, I am going to the Ideas site to sign up for the beta so I can start chatting with my buddies on Yahoo! without launching my Yahoo! IM client.

MySpace # 1 in the US but not in Canada

Thu, 13 Jul 2006 04:30:25 GMT

Did you hear….MySpace is the number 1 website in the US? This piece of news has been picked up everywhere and there is a lot of buzz in the blogosphere about it. This news was picked up by the Globe & Mail in their business section and Mark Evans has even mentioned it in his blog. I like the comparison Mark made on his blog “the social networking "opportunity" is similar in many ways to China - the market is huge from a people and potential perspective but it looks like a hard nut to crack in terms of making money. Marketers are hesitant to advertise on Social Networking properties as they host user generated content and marketers can’t control where their brand might show up. However, if you look at the success of MySpace in attracting advertisers, it’s pretty easy to see that they have cracked the nut. They are successful at attracting advertisers, some people might even say that MySpace is being over monetized and there are too many ads on it. I do agree that there is an element of risk when advertising on blogs and social networking properties such as MySpace. However, there is a way to reduce this risk by advertising on special blogs that have been created for a celebrity or a series of events. The bottom line is that the youth are hanging out and spending hours a day on blogs and if you want to reach them, this is darn good way to do so.

Getting back to the article in the Globe & Mail and Mark’s post, the thing that gets me (and I will jump on my soap box for a bit) is that none of the coverage I have seen so far talks about the Canadian angle. MySpace is in a leadership position in the US but the story is very different in Canada. With over 8.2 million unique visitors in May 2006 (according to comScore Media Metrix, All locations) MSN Spaces is the leading online blogging service in Canada. MySpace is not even in the top 5 in Canada. Yet, no one seems to be interested in talking about the phenomenon in Canada and what Canadian youth are doing on MSN Spaces. I know I have a bias on this front as I work at MSN Canada but regardless I am surprised that no one has pointed out how we differ from our neighbours down south. I was shocked to see that there was a session at the recent Youth Marketing conference on MySpace. My colleague, Mike Sharma hits the nail on the head on his blog, when he talks about marketers are losing sight of where their audiences in Canada are hanging out. There is no doubt that in Canada, its MSN Spaces.