All posts by Bill Hunt

Bill Hunt is the co-author of the best selling book Search Engine Marketing Inc - Driving Traffic to Your Companies Web Site from IBM Press now in it’s 2nd Edition. Check out the companion Search Marketing Inc blog Bill is currently the President of Back Azimuth Consulting which helps companies understand their consumer by mining search and social media data.

Big Data with No Thinking

Cleaning our my screen captures I found this grab that was good for a rant. Nearly 2 years ago I converted my Business Week subscription from print to digital for my iPad. Appearntly the non-digital side of Business Week was not aware of my transition.

big_data_no_thought

In a single day I receivied 3 offers from them for the print version of the magazine.

Offer 1 – 26 Issues for $20

Offer 2 – 50 Issues for me and a gift 50 issues for $30.00

Offer 3 – 50 issues for $75.00

In all 3 offers in the codes at the top it had the expiration of my print subscription so they knew I was a previous subscriber. I assume they did not mine the database to know that I converted that account to digital – these were clearly to get me to come back to print.

The real part of my rant is getting these 3 offers on the same day. This is just silly. Typically I just throw them in the trash but I was curious. Looking at the 3 offers more closely. Had I received them on different days I would not be able to compare and if any of them seemed like a value I might have bought.

Clearly offer 3 is out since it is the most expensive of the three.

Offer 2 seems to be the best “deal” since it is 2x the issues of offer 1 and I get to make someone else happy by sending them 50 isses.
Unfortunatly most people I know all read it digitially so no one to give them to.

Offer 1 is not bad but not as good as #2.

I just thought in the age of big data and rising mailing costs that a a company like Business Week would be smarter about these offers. Stagger the days etc. The worst offender is American Express. I often get 10 of the same offers in the mail for my various jobs and companies over the years. A simple check of the company would show half of them are not active nor am I associated with them. Again, big data can help sort all of this out.

Loyalty and Mileage Awards Have a Higher Cost than Expected

First I have to admit, and most people who know me I am a mileage whore. Everyone who has traveled with me is always amazed at the ways I can find to accumulate miles. At my peak I was flying 300k plus miles a year and 150 nights in hotels so I was typically United Global Service, British Airways Gold and top level in Starwood, Hilton and sometimes Hyatt.

As a mileage whore, I check my account. I did this week and found that United has not been counting a number of my flights. Still looking for a good app but my expenses reports and “bonus” file help a lot. Given the current state of affairs with upgrades and award flights you need all the miles you can get and I find most of these that give them are giving less and less and taking more and more from us “loyal travelers.” nearly every program I belong to have been harassing me to vote fot them in the annual Freddie Awards for loyalty, perks etc. A few that I have been loyal to over the years did not get my vote this year.

Flight Credits

I looked n my account to make sure a partner flight was credited as noted below. Then I noticed that some of my recent domestic flights were not being posted especially between months and quarterly statements. For example, I flew to St. Thomas for a dive trip and got credit for the flight from Newark to St Thomas and back to Hartford but not to Newark from St. Thomas. Granted that was only 500 miles but why not? That is the day they changed months for statement purposes but it was not on the previous statement. United told me it was a “system error” and they credited the 500 miles. I have found similar problems – to be fair, once I catch them and submit the request they do credit me but how many people are not looking at their statements.

International Partner Credit

A few other of these missed credits were international partners like Austrian, SAS and Air China. These Ironically, they counted one of the legs but not all of them which made it even more stupid.

Austrian Airlines Mileage Credit

I was flying roundtrip Stockholm to Minsk. Yes, I could have taken a direct flight on Belevaia Airlines which is the national airline of Belarus. Since it was direct the cost was a bit more than the round about flight. But, being the mileage whore (an a family that loves Austrian chocolate) I took a flight on Austrian Airlines, a Star Alliance United Airlines partner. What I did not notice was that one of the legs was classified a “K” class and this is a level where they would not give mileage credit. So apparently since 1 leg was K (although another was Discounted Business Class) they declined credit for all legs based on an email that I just got from United Mileage Plus Customer Service.

OS318 – Stockholm to Vienna – Class = M (Economy with 100% base mile and 100% Premier qualifying miles)

OS687 Vienna to Minsk – Class=M (Economy with 100% base mile and 100% Premier qualifying miles)

OS690 – Minsk to Vienna – Class =K (no mileage credit given)

OS311 – Vienna to Stockholm – Class =Z (Discount Business with 150% base miles and 15% Premier qualifying miles)

While I am still fighting the credit (on 5th email) the moral of the story is to check the United Mileage Partner’s Site to make sure that you can get credit for the different classes of tickets. I had no idea there was a class of service in the itinerary that would not get me credit. I guess it is my fault for not checking but in 20 years and well over 2 million miles of flying United I never found it necessary. In the end I should have flown the direct flight and saved time – again – cracks in the loyalty foundation.

Price of Flights

We are planning on taking a trip over to New Zealand after SMX Sydney this year to see the new Hobbit Town.

Being loyal to United I thought I would try to combine the trips and for a 3 hour flight from Sydney to Auckland United wanted over $3,000. No, it is not their typical fly me back tot eh US then to Auckland – it is in fact the Air New Zealand code share for 3 hours that is only $300 on Air New Zealand. Obviously I booked them separately. I am finding this happens a lot especially with United’s system.

Upgrade Points and Pay

For a flight to London where the client will only pay economy I had planned to book a upgradeable economy and use my miles. The upgradeable flight was $868 for ROUND TRIP and the screen showed it would only be 40,000 miles each way but that I would have to pay $550 per leg for the upgrade. This made the price to round trip upgrade more than the flight itself. Granted a business class flight is nearly $4,000 it was a good prices. Problem is I can fly from Boston to London on Virgin Atlantic Upper Class for $3,000 or in their Premier Economy which is the same as United Business on the 757’s they have been flying for $1,475.00. I have shifted to Virgin Atlantic and Iceland Air for most of my Europe and Scandinavia flights since they are cheaper and far more comfortable than United.

Capitalism, Good Business or Greed?

Here is another case where I have to question is this pure capitalism, good business practices or greed praying on those who are struggling?

Progressive Insurance

My son in Boston has progressive auto insurance.  He got an email notification that his car insurance was coming due.  It was interesting the various payment options available for the six month policy. I love how they thank him for being a loyal customer then reach deeper into his pocket to extract crazy fees.

Options:

Option 1 Pay in Full – For $696.00 – this is the best “deal” for everyone. It gets my son the best price for coverage and Progressive the money up front. This does mean he is “prepaying” for his insurance. If he wants to shift it is harder to do and takes about 30 days to get a refund.

Option 2 – Automatic Deductions:  $864.00 this is a 19% premium over the base price.  At this rate, you are paying about the same as most credit card interest for people without great credit so not a bad option if you can’t pay the full amount up front. It is easy, you don’t do anything except make sure money is in your checking account. Progressive does have to wait for their money since most of these are paid even if you don’t have the money and if you don’t you get hit with overdraft. It is automatic for Progressive and the $1.00 cost for the digital transaction is still profitable. I don’t understand the reason for a 19% premium other than they can.

Option 3 – Monthly Installments:  $1,009.00 – this is a 41% premium. This should be against the law. I would call this a “broke and/or dumb person penalty” since this person is broke and can’t pay and needs to call the day of the payment and pay them OR does not have a credit card where teh interest would be lower to just pay it and then pay the credit card each month.

Both of the periodic payment options represents the risk of the customer not paying and the loss of a customer but more importantly the time value of that prepaid interest revenue.
The capitalist in me finds nothing wrong with this since you are paying for a service where you have a choice in who you do business with.   But then again, this is prepayment of the insurance which you have not consumed. We don’t really do this with anything else?  These preapyments only seem to happen on insurance other than expensive medical insurance.

The emotional human side of me thinks this is wrong to prey on people that can’t pay for the full six months. You were laid off, had a emergency payment for a doctor or a large home repair and have to pay in installments – is a 41% for “installment fees” appropriate?  If they don’t pay in that month then they get cancelled so it is not like they could actually rip off the insurance company.

Fortunately, our son is doing well and learned when he was in high school that he needed to budget and save money ahead of these large expenses so that he can pay them in full which in this case he did.

Stupid Systems or Greedy Airlines?

A few months ago I was looking to book a flight for my wife and I go to from Sydney to Auckland New Zealand while we are in the area for a conference.  Being a “very” loyal United customer I went there first to check on flights.   I was going to one big trip – into Sydney – the hop to Auckland then back to the US from Auckland.  That was a problem so I tried to just add a simple leg to Auckland.

Now I have written about some crazy routs by United but this is a simple 3 hour flight in Economy that they thought a fair price for was over $3,000. Interestingly it would be on a code share partner Air New Zealand.

united_wtf

So like any good price conscience shopper I went ti Air New Zealand to see what they would charge to fly the exact same seat on the exact same airplane and it was starting at less than 10% of what United wanted. At the 10% rate I would get a better seat and a meal unlike what I would get with United.

air_new_zealand

You would think the systems would flag this type of thing but I guess if someone was willing to pay the yield on that route would be amazing. In my case I booked it with Air New Zealand.

To many damn surveys

I recently traded in my tree hugger Prius for a Mini Cooper CountryMan which I love.  I really liked my Prius but got tired or not being able to quickly pull out from a cold stop and wanted something a little more upscale.   Anyways… since buying the car two months ago I have received 12 different surveys.   The first one I did since it was from Mini Cooper.  I had an amazing experience buying it from my dealer and have been very happy with the car.  Maybe that was my first mistake – actually taking the survey.

Over this past weekend I received 4 more different survey packets in the mail all wanting to know about my new car buying experience, the features and one I would almost interpret as a “why did you not buy American” since that was the sort of questions.   I just threw all of them in the recycle bin.  I have never had this many requests for information after buying a car.

Nothing more specific other than they were all very long and none of then gave me any real incentive to complete them.  All would enter me in some sweepstakes to win $50 or potentially an iPad.

Is the bad economy creating Cowardly Marketers?

I do think the bad economy (yes, its bad and not some scare tactic by Obama) and the fear of loosing their jobs that are causing some marketers to hide their heads in the sand and allow grossly under performing campaigns and programs continue to run.

Until recently I had rarely encountered a marketer who actually admitted they were “afraid” to tell management of problems or poor performance in a marketing campaign. In most of my experiences companies wanted to know so they could fix it or not repeat it. As long as they learned from it they can and should improve it. It seems now that I encounter this fear of even knowing they have problem almost 50% of the time. At a time when we should be trying new things or wringing every dollar possible from our campaigns too many cowardly marketers don’t even want to know how poorly they are doing .

I recently did a pilot of my tool for a couple of companies that showed significant problems with their search programs. While they loved the insight and the identification of a lot of problems – two of the companies decided not to continue the pilots since they were afraid that it would showcase “too many opportunities.” I always thought it was silly when companies referred to “Challenges” and “Problems” as “opportunities” just to make themselves feel better. But to not want to know you have problems or let management know at this frequency is pretty amazing.

In one of these cases, we pulled in all of their PPC keywords and found that over 27,000 words had a negative Return on Ad Spend (ROAS)- meaning the media cost was more than the revenue generated. Not always a bad thing, but the amount of the loss in this case was just over $155,000. The company was in total disbelief that they had that many under performing keywords. Just looking at a few of the words we found significantly opportunity for changes that would improve the campaigns. Ironically, this loss for a single month was 3x their annual SEO budget which was doing nearly 50x the returns of the paid program

In another case, we found nearly 300 keywords with over $100 in organic revenue that were not in their paid program. We also found that 16 of their top 20 most expensive words were not in any sort of SEO monitoring or optimization program. If your willing to pay a premium for keywords in PPC they should also be as important to the SEO team.

While I can understand the concern letting it continue only makes it worse. I had my first “don’t tell management” experience many years ago when working in a similar “fear-based” management culture. My first job out of the Marine Corps was for a Not-For-Profit company doing medical records review for the federal government. They were part of the government but privatization sounded to the government agency good so they merged 10+ offices into one the year before I started working there. This meant there was a lot of office furniture that belonged to the government and no one knew what to do with it so they put it in storage and forgot about it but were paying nearly $15k a month in storage fees. Apparently everyone in corporate accounting thought this was medical records storage (even though there was a separate line item for records storage) and not old furniture storage. The silly part is any excess government property it can be turned into the re-utilization center at no cost. We were lucky that we had one not afar away on the Marine Corps base and even better one of my Marine buddies worked in that division.

Being the go-getter, I got the appropriate forms from my buddy, wrote database application for the inventory management so that we could quickly process the paperwork. I called a local moving company to get a quote to load and deliver the furniture to Orange County from Los Angles. Total cost out the door was about $16k given we would need to do 4 semi truck loads and half-dozen temps to load them. My budget request was “denied” due to not having the money budgeted. Ironic we could not spend $16k to save $180,000 in annual storage costs for furniture and equipment we would never use. Even worse, the local management team told me to “forget about this” because if senior management had heard that they did not dispose of the furniture and were burning that much money to store it it would be hard to explain. In the end, a financial audit found it and these incompetent managers were fired over hiding this from management.

I hope this trend does not continue and maybe when the economy gets better it is easy to piss away a lot of money but when times are tough we should encouraging our teams to dig deep into the data and find nuggets of savings and performance improvement.