Required Reading for Web 2.0 Entrepreneurs

I just recommended that our World Vital Records team all get copies of the new book from 37signals called Getting Real. Get this: you can read it free online or buy a PDF or paperback version of it. They’ve sold 20,000 copies so far.

I will probably read part of it online and then buy the paperback version so I can mark it up like crazy, and put my notes at the end of the book the way Tim Sander’s teaches you to read in “Love Is the Killer App” (my most highly recommended business book of all time.)

Also, I was on a Facebook online marketing group tonight and found out that Paul Graham’s Y Combinator has released a reddit-like news aggregator for startup entrepreneurs. Check it out: it’s going to be recommended reading for all the entrepreneurs I know.

Paul Graham’s Y Combinator is an incredibly cool incubator/seed stage funding mechanism with an incredible focus on technology startups. If I ever do an incubator again (after spending the next N years running World Vital Records), I’ll meet with Paul first and try to learn from what he is doing. I think he’s nailing it.

But, I may never do an internet incubator again, since Geni just demonstrated that a genealogy/family social networking web site can become worth $100 million in about 8 months.

Can you believe it!!! With 100,000 users in less than 2 months, and with $10 million in new funding (at a $100 million post-money valuation) Geni is poised to become one of the most important players in the genealogy world.

It will be interesting to see their revenue model, as it unfolds.

We found at MyFamily.com that it was nearly impossible to make money with online advertising. When people are engaging with their family in private communications and content sharing, they are in what we called a “heads down” mode, that is, they were really focused on their family, and not willing to click on advertisements. We tried all kinds of things, but nothing worked.

Many other content sites are “heads up” sites, where people are in exploring or research mode and are totally ready to view ads and click on them. Our advertising click rates at MyFamily.com (where I worked from 1996-2002) were about low as I have ever seen anywhere.

So the Geni model, if it is advertising based, will be interesting to watch.

My guess is that Geni could be like YouTube–get acquired for a ton of money because of its number of users, without any regard whatsoever to revenue. That surely must be what the venture investors are thinking. If an exit like that happens, more power to them.

But if an exit like that doesn’t happen, in other words, if Geni is required to make money (and a lot of it because the valuation is so high), then the company might have to severely compromise its user experience, and bombard people with online and email ads in order to survive.

World Vital Records has been working on its “MySpace for Families” business for several months now, before we had heard about Geni’s launch in January. So we believe in this space. But unfortunately, we weren’t the first one’s to launch a real Web 2.0 application for family history.

But we believe that our angle is very unique. Our team has deep roots in family history, and our approach is very different from Geni’s, although we can certainly learn a lot from what they are doing. Our social network site won’t have to make money because our genealogy subscription site is doing that for us (we had a record month in February), so it can focus on member acquisition and user generated content.

Our site will be called FamilyL— something. Stay tuned.

Make your web site mobile friendly

I’m reviewing some of the powerpoints from December’s Search Engine Strategies Conference, particularly the presentations on mobile web site design and marketing, which were excellent.

The session on Mobile Search Optimization, moderated by Danny Sullivan, was excellent. Someone took copious notes and posted them. Must have been a court reporter present.

One URL was given out that gives instructions on how to make your web site mobile friendly in just a few minutes.

I’m finding that I use my Blackberry web browser more and more frequently. I’m sitting at a desktop less and less for web browsing, and even more rarely for email.

Janice Roberts from Mayfield Fund (founded in 1969), a veteran VC firm from Silicon Valley, gave the Entrepreneurial Thought Leaders lecture at Stanford last week. (You can get the podcast for free.) In her career, she worked at 3Com, bought more than 30 companies for them, was involved in acquiring Palm and taking it public, and has been at Mayfield for 6 1/2 years. In speaking of trends for the future in this lecture, she talked a lot about mobile devices and how many people (especially younger people) want anywhere access to everything.

If you haven’t thought about making your web site mobile friendly, you are falling behind the times.

If you have tried it, tell me what you think of the instructions from mikeindustries.com or how you approached the task.

Also, in your comment, give me the URL of your mobile-friendly site, so I can try it out on my Blackberry.

NONE of my portfolio sites are mobile friendly yet, including World Vital Records (where I am CEO), which is why I continue to lecture on this topic and blog about it.

How to save thousands of dollars on your next web development project

My friend Spencer Rogers came to the Provo Labs Academy last Wednesday and gave the finest presentation I have ever seen on how to outline your website using Word and then build a user flow version of it (without any look and feel elements) in Powerpoint before spending a dollar on designing and developing the site.

By disabling the Advance slide on mouse click option (found under Slide Show/Slide Transition) and by making objects clickable and linked to other slides, you can design how the site is going to work before sending it to developers. You can show where navigation elements will appear and carve the web pages up into feature and content areas. You basically outline the functionality of the site page by page, leaving the design to someone else.

Spencer worked for years in industry designing software for clients. He has applied these rapid prototyping concepts to web site design and has been responsible for the design of dozens of websites in the last few years.

After seeing one of Spencer’s Powerpoint web site mockups two years ago, I blogged about the need for wireframing before developing a web site. But I didn’t know the depth of Spencer’s approach until last week. I just kicked off a new web site project where the developer did wireframes (he was already familiar with Spencer’s approach). And I’m working on my first Powerpoint currently for the next generation for one of my web sites.

Spencer showed us his Powerpoint outline for the relaunch of EverySingleHome.com that he made a year ago and then showed us the new site that just launched, and how closely it followed his Powerpoint design.

It is so costly to design a web site without a clear road map. Design it on paper first before getting into coding it. If you aren’t careful, feature creep can totally wipe out your budget. Working in HTML and doing actual programming as the site is being designed can be enormously expensive. If you take a new direction, as you almost always do, you will throw out a lot of code and waste a lot of money.

Nail the actual site architecture first, and then pay for the design and coding. There is a scriptural concept that says things should be created spiritually first and then physically. And another one that says you don’t build a house before counting the cost of it. This is only possible with prior planning. And the Powerpoint approach seems appropriate for most projects, since most of us know how to use it and already own a license to it.

By the way, EverySingleHome.com is an amazing real estate web site that lists every home for sale in Utah County and has a photo of each one. It has an Alexa ranking of about 45,000 which is incredible since the site is only in one market. It is a very comprehensive real estate site that anyone who is buying or selling real estate in Utah County should be aware of.

I can’t finish this post without commenting that the best product manager that ever worked at MyFamily.com (who is now an incredibly successful internet businessman) used Powerpoint whenever he designed a new feature or service. While other product managers were writing the dreadful 20-40 page MRDs (marketing requirement documents), he would do screen captures of the existing design and add links or components to show what the new pages should look like.

He was super fast at this. Way faster than those who were writing the long books. And more importanly, his visuals communicated instantly and clearly exactly what the site would do, while the MRDs were time consuming and communicated very poorly. You had to plod through the MRDs to try to find anything useful. I absolutely hated the MRDs, but I loved these Powerpoints. I’m not sure what happened to the product managers who used MRDs, but my Powerpoint is one of the most successful internet entrepreneurs I know.

Like Spencer, he has used this skill to great benefit.

Be Objective About Your Web Site Design

Today, I’m teaching a class on web site design at Provo Labs Academy. In preparing for the class I am reminded how often emotions run high when people discuss or debate how a web site should be designed. There are lots of strong opinions out there, and many of them are not informed by marketing experience, but simply by personal design preference.

So I need to remind everyone that Jakob Nielsen is right about the importance of user testing. I have always loved his “Discount Usability Testing” concept. He simply says invite 5 people to use your web site and you will find 85% of the usability problems. The cost of doing this is ridiculously low and yet most companies never watch real people try to use their web site. Therefore, many usability issues go unresolved, costing companies money every day.

If you combine user testing with web analytics (and A/B split testing) you can make your decisions objectively based on real feedback from customers. Then it doesn’t matter who is right. What matter is, which design generates the most revenue?

Training: Web Site Design, Landing Page Optimization and Conversion Rate

Yesterday we held a Provo Labs Academy training session on landing page optimization. I played about 15 minutes of excerpts from the May 23rd MarketingExperiements.com conference call recording. They described how they increased the conversion rate of a hypnosis product landing page by 40% by improving the layout and design slightly.

They also offer some excellent guidelines for landing page design at the end of their report.

We also reviewed the landing page design guidelines listed in the free 30-page report from Enquiro.com (Inside the Mind of the Searcher) from 2004. (Registration is required.) Here is the list they provide:

What Purchasers looked for on a Landing Page

(in order of importance)

* Query Keywords – In a heading or other prominent location
* Product Picture
* Offers – Value added offers, i.e. free shipping
* Prices – Don’t make them ask for it
* Features — Find out more about the product
* Clean Professional Layout – Is this a trusted site
* Clear Conversion Path – Is it easy to buy or ask for more information
* Selection – Ability to see different products in one place. Should have trusted brands featured
* Comparison – Direct comparison between models
* Clear Navigation – Is it easy to move around and continue researching

It is incredible how many PPC campaigns take you to the home page of a company’s web site or to a page that doesn’t match at all what the person was searching for.

Your landing page should contain the keywords your visitor was searching for and if they are searching for a product, it should have a picture of the product. Otherwise, in the few seconds that they spend scanning your page, they won’t immediately see what they were looking for and they will leave. Your bounce-off rate will be extremely high.

We also discussed the MarketingSherpa Landing Page Design Handbook, which sells for $247.

The editor of this handbook Stefan Tornquist shared 5 ways to increase landing page conversion rates with TechWeb last year.

Some powerful tools for optimizing landing page conversion rates include Optimost and Offermatica. The new Google website optimizer tool is in beta and we don’t know anyone who has been accepted into the beta yet.

One of our Academy members has 20 years experience in direct marketing. He said long format direct mail pieces traditionally pulled better than short format, but in today’s world of information overload, he has been finding more instances where short format pulls better.

In 2004 MarketingExperiments showed that most of the time long copy still pulls better than short copy, but a recent example (see test #2 on this page) had different results.

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Can’t Live Without Web Analytics

I’ve been using web analytics from Omniture this morning (Provo Labs uses it in our more mature portfolio companies) to discover some really interesting (and disturbing) customer usage patterns.

LDSMedia.com — our LDS search engine — has a new subscribe page. Using SiteCatalyst, I can run a report showing every visitor in June who hit the signup.php page, and using the Next Page Flow Report, see visually what each of them did next.

16.3% of our visitors who hit the signup.php page exited the site. Not good. 4.7% went to the home page (using the ClickMap I would be able to see if they clicked on the logo in the upper left corner of the landing page.) 2.1% went to the login page. The vast majority of visitors left the signup page and went back to the content page they were looking at. In the few seconds they take to look at our signup page, we lost almost all of them. Only 1.8% clicked through on one of the green “Sign Up Now” buttons.

1.8% would be an okay conversion rate for a content subscription web site. But this isn’t the site’s conversion rate. Only a small percentage of these people who clicked through actually completed the credit card process, so the overall site conversion rate is extremely low.

To me, this is a huge opportunity. Fortunately, we’re only a week into offering the subscription and this is the first landing page we’ve tested. The good news is that we are an internet company. We can make a few changes, test the results, make a few more changes, test again, and over a period of time optimize our subscription process so that the messaging is just right and the signup process is easy and appealing. I can’t wait to blog in a week or two about how our next landing page doubled or tripled our conversion rates!

With hundreds of thousands of people searching the internet for important LDS religious content, much of which is only available on this web site, our conversion rate should be (and will be) much higher.

By using web analytics, we have a starting point from which to measure our progress.

Web analytics is one of those essential ingredients to online marketing success that most people aren’t familiar with. There are a lot of free web stats packages out there that just don’t give you what you need. And more commonly, there is so much data available that it is nearly impossible for the untrained webmaster or marketer to know which web analytics reports are really important.

This morning I came across this excellent article about web analytics. I’ve been using web server log files and custom analytics reports since 1997 and SiteCatalyst since 2002, so I’m extremely familiar with hundreds of different reports.

But I love how this article focuses on six practical reports that online businesses should run regularly in order to understand their customers and how their web site is working (or is not working).

I think in all the years that I’ve been involved in online marketing, this is the best introductory article on web analytics that I’ve ever read. I’m definitely going to be using this in my BYU internet marketing class this fall.

I would like every Provo Labs employee to read this article and run each of these reports of one or more of our web sites.

We’re going to have some Omniture SiteCatalyst training in an upcoming meeting, but in the meantime, try to run each of these six reports and carefully review them to determine what we should do differently or what we should do next on our web sites.

Most importantly, if you’re on the LDS Media team, let’s put up a new landing page today or tomorrow that isn’t so complicated. The one we are using right now has Basic and Premium packages (too complicated) and has way too much text. It was patterned somewhat after a popular genealogy subscription web site’s signup page, but it is obviously not working for us.

I would like us to test a completely different page layout that is patterned after RealNetwork’s SuperPass 14-day free trial signup page.

What I love about this page is that it offers a 14-day free trial and captures an email address at the very beginning of the subscription process. Since growing our email database is a high priority, this approach makes a lot of sense.

We don’t have to try to convert a visitor into a paying customer on the first visit. If we can capture their email address and permission to contact them again, then we will have many opportunities to interest them in our premium content in the future.

Let’s launch this new 14-day trial email capture landing page and start reporting on how many new email addresses we get each day in addition to the number of daily subscribers.

Neal: I’d like an email or SMS every day with those two stats in them.

Call for Utah experts on Usability testing

I blogged the other day about the need for usability testing of web sites. The Steve Krug book “Don’t Make Me Think” is a good one, but my favorite is still “Designing Web Usability: The Practice of Simplicity” by Jakob Nielsen.

One of my readers asked:

Thank for the blog entry on usability the other day. Do you know of any usability/UI experts here local in Utah?.. Or that you can recommend locally?

I haven’t worked with any external consultants or firms that will do this. Does anyone know who the best people are in Utah?

And since usability testing can be done from anywhere, who are the best firms worldwide for doing web site usability testing and feedback?

Single Product E-Commerce Sites

Yesterday I spent time looking at internet marketing tools (I’ve purchased and used several over the years). I decided that Web Position Gold’s web site is perhaps the cleanest and crispest single product ecommerce site that I can ever remember visiting. The layout, design, formatting, and copy is so well done.

Question for readers: what other single product ecommerce sites do you think accomplish their purpose superbly? And why are so few web sites laid out so well?

As a side comment, I’ve always been biased towards the functionality and not the design of a web site. If you look at ICQ in the early days (here’s an ICQ snapshot from 1999) before AOL bought it for hundreds of millions, it gained millions of users with one of the ugliest text-based site designs you have ever seen. Because the functionality was hot. More recently, Craig’s List is succeeding in a huge way (including getting a minority investment from eBay) with a horribly ugly — but very functional — text-based site design.

Jakob Nielsen is still my authority on web usability (www.useit.com) and Google is still my favorite example of simple but functional web site design. Too many designers are artists. Too few designers think about the user experience and how it can be simplified.

I also love the book by Steve Krug, Don’t Make Me Think: A Common Sense Approach to Web Usability. One of his objectives is to help designers cut out useless stuff from web pages, making them far clearer, more readable, and more usable. Most of the time you can eliminate half the copy, then eliminate half the copy again, and end up with a better web page.