Russ: This is a a BusinessMakers WebXtra, a continuation with our discussion with Steve Latham, founder and CEO of Spur Interactive. It seems like the traditional agencies might be feeling like they're entering a paradigm shift right now and might even be a little bit nervous about it.

Steve: Yeah, I think so. And what's different about online or interactive from traditional media is you can't just hire a person that knows everything about online and build a practice around them. It's really difficult because you have to have expertise in a variety of different disciplines that are quite different. You know, good Web design and user experience is a very different domain and discipline than search engine marketing. Even within search, people who optimize search for natural rankings are a very different skill set, and a lot of times just capabilities and someone who is really good at managing paid search. Even though they're the same medium, they're totally different approaches to using those for search visibility. People who are doing online media planning are very different than the people that are creating the ads that go on those sites or in that media. So, you can't really have one person do it all. What you can do is have a team of people with different disciplines and expertise to bring all those resources to bear to help you build your brand, but I think that's why you hire an agency a lot of times is because you can't hire 1/4 of a web designer, 1/4 of a media planner, 1/2 of a search engine marketing manager, and then a creative director as well. You've really got to take a team-based approach to these things and do it well, and that's why I think there's a role for agencies, especially where the landscape is still largely unknown by most brands and most marketers.

Russ: Well, Steve, you were doing a good job of describing the different areas of specialty that are all sort of subparts of interactive marketing. You mentioned the user interface on a site, the site design, search, social media, display advertising.

Steve: Well, I think as an interactive agency, we take a strategic approach and try to provide a full-service solution. Because it is pretty vast, there are areas in the agency that focus on what you specialize in and then you bring in the services that you need to really fill the gaps. I think where we're really strong is helping to understand how to reach and gauge your audiences, how do you get them back to your site, how do you convert visitors to prospects or customers. With that, that incorporates a lot of media planning and figuring out where you can reach those people online through search engines and obviously the search engine marketing, e-mail marketing, and e-mail advertising, but then also making sure that your site is optimized to convert traffic to leads or to prospects or to customers. So, there's things that we can advise on but we can't really do for a client. Social media is a great example where we can provide them a road map of what to do, but at the end of the day they have to be their own voice. So, I think we try to specialize in what we're really good at and then really bring in the resources outside where other pieces are needed to fill in the gaps for the client.

Russ: So, you might actually bring in an individual consultant that specializes in an area?

Steve: Possibly, yeah, especially if it's unique. A lot of times you'll find a client that wants you to integrate into their existing Web infrastructure, and they might have something that was written in Java or PHP or cold fusion-you never know what you're going to find, so obviously finding those skill sets to integrate into what they already have is sometimes-you know, you can't have all that in-house so we might bring those in for different projects. At the end of the day, what we want to own is really the strategy, figuring out what are we going to do, how are we going to do it, how are we going to measure it, overseeing the media part of it which is how do we reach those audiences, how do you engage them, put together a cohesive plan that gets them where you want them then to helpfully convert those people and do it in a measureable way, and then you have to test and learn as you go. So, I think that's one of the big advantages of online media which is you can test and learn really quickly what works.

Russ: But isn't it true, and I would put this in the category of a disadvantage, it changes so rapidly. I mean, it seems to me that you could recommend something to somebody, and it worked very well, and suddenly 6 or 7 months later it's not working. In my experience, one of them is display advertising. It seemed like, boy, there was this creative competitive race to see who could do the coolest ads for a while, and they would work for a while, then all of a sudden they wouldn't work anymore because the target audience has changed. Am I the only guy that experienced that?

Steve: No I think you're spot on that it always changes. What works today will not work to the same extent it will in 6 months. We see this a lot today. A great case study, for a client about a year ago we did kind of a competitive assessment to figure out how they were in the market. We really had to struggle to find competitors online. Now, less than 12 months later, their space is very competitive. They do an elective surgery that is largely covered by insurance, and what we've found is that every doctor that provides that has learned how to set up a Google ad words campaign. So you used to have 2-3 competitors online, you now have 20. So what it's done is increase the price, increase the number of options the consumers have. So, it costs more to be there, you get lower click-through rates, you get lower conversion rates because people have more options. So the economics have deteriorated, and this has really been the case over years and years. We were, I guess it's almost 5 years ago, we brought Lasik Vision Institute online from the guys that bought the 1/4-page ads in the Sunday comics for years, the $299 per eye Lasik surgery. We brought them on and lowered their cost per lead by 80% to 90% from traditional media, and it was easy, it was like fishing in a barrel. All of a sudden, less than 2 years later, that cost per lead had tripled because all of their competitors were in it, the cost per click had quadrupled, their conversion rates had fallen, you know there's a horizon for every new niche and opportunity online because, if something's working, others are going to figure it out, and that's why it's always changing, so you constantly have to be looking at what's next.

Russ: It almost seems to me like it could be an advantage for you in, when a client engages you, it almost seems like it would be in their best interest to continually engage you to watch what's going on. Do you have customers that do that?

Steve: We think so. There are certain things that certainly lend themselves for them to be taken over in-house, and we're happy to do that, and there's certain things that they can take over once we've got them up and running. But, the landscape does change, and the requirements are constantly changing for success, so we have to constantly be looking at what's next and what's new and how do we continue to build on what we've done.

Russ: Steve, why don't you give our audience just an overview of the kind of businesses and customers you do business with.

Steve: It kind of varies from B to B clients like Halliburton and Texas Industries and Amegy Bank to, on the consumer side, retailers like Sun and Ski Sports to big direct marketers like The Scooter Store; you've probably seen their ads on TV during the day. I think they all have very different needs, objectives, certainly their audiences and what they're trying to achieve are all different, but they all have, I think, a common goal which we want to effectively use the web as a channel. They realize that that's how people are choosing to consume media, and so they hire us because they want help figuring out what should be do, how do we do it, how do we measure it, and how do we make sure it's being executed correctly. That's kind of how we evolved into being a full-service agency.

Russ: Okay. Let's say I'm tuned in, I'm listening to the show, and I sell to consumers, and I've got a website but it's just kind of there but not really performing like I would like it to at all. What should I be doing?

Steve: I would recommend what I call a foundational approach which is really 4 things. It's making sure your site is optimized for usability; it's easy to navigate, it's easy to figure out who you are, what you do, find what you're looking for, but you're also giving them good cause-action or good reason to take action whether it's register to learn more about us or request some information or make a purchase. Most of our clients don't sell online, but they realize that's where a lot of the initial engagement takes place. So, the first thing is really improving your site usability. The 2nd is having some metrics to measure your performance. You want to really look at your performance over time and define what are the metrics that are going to help us determine whether or not we're improving, getting better, getting worse, staying flat, and there's things like, you want to not just look at what some people might call hits, but really, things like page views, the time spent per visit. Those are metrics that are going to help you determine are people engaging and spending more time on the site, what percentage are taking action, etc. The 3rd is really search. You've got to be in the search engines. You can't be effective as a marketer and not be found in search engines. Those are generally people that are in market looking for your product or service. You want to make sure that you are easy to find, that you have a good compelling copy on there that's going to get them from the Google or the Yahoo pages to your site, so search but through paid and natural search optimization are both really important. And then fourthly, e-mail marketing is generally one of the underutilized yet most profitable tools in your kit which is, after people have come to your site, they like what you have to offer, get them to sign up to join your newsletter, and send them content that's relevant to them. You've got to segment, you can't really send a one-size-fits-all message to everybody, but if you can segment based on what they're interested in, it's pretty easy; all you have to do is ask them when they're signing up, what are you interested in, choose these boxes. Then it makes it really cost effective and profitable to reach them to upsell, to build a brand, whatever it might be.

Russ: Okay. What if I sorta had been hearing about this social media thing and think I ought to be considering that as well?

Steve: I think social media is something that you have to get your arms around whether you're a B to B, or B to C, or whatever your business is, how do we effectively use that. I think on the consumer side most people kind of get that. On the B to B side they still struggle with that, how do we use it. I would advocate that before you put a blog on your site, before you start trying to ramp up with a Facebook profile for your company, I would start by just participating in discussions that are already taking place out there. No matter what industry you're in, there are discussions taking place, and your brand is probably being mentioned once in a while. I think a great case study of that is Continental Airlines has a guy whose job is to basically hang out on flyertalk.com and some of the other kind of business travel sites and really be the voice of Continental to their audiences. When people complain about something, he's there to learn more and then go hopefully implement some change, come back, report to the community here's what we did, thanks for that input, and that's a great use of social media, and none of that takes place on Continental.com, so it's a great case study of a company doing good things. I think after that you've got to be on LinkedIn. If you're in business, you need a LinkedIn profile. It is a phenomenally effective networking and recruiting platform. I think everybody needs to be on Facebook. I read today that most of the people coming on Facebook are over 35, in fact over 50% of the members now are over 35. It's actually probably going to become less cool for the college kids, they're probably going to move on to something else at some point, but everybody who has been getting on Facebook really I think has found it, not only from a social networking standpoint, but it's also good from a business standpoint because you are your brand in a lot of ways, especially if you're an entrepreneur or an entrepreneurial company, what your employees and what your people are doing out there really reflects on your brand, and obviously you don't want to put anything up there that you wouldn't want your clients to see. I think then you also need to look at Twitter. Twitter is becoming a pretty popular and important platform, and it's a great way to start networking. So I think there is a lot of value out there, but you don't want to jump into creating a blog until you've realized how much time it consumes and be ready for that commitment. But it's a great way to start just by participating in discussions that are already taking place.

Russ: Cool. That's great advice. I really appreciate you sharing it with us, and Steve I really appreciate you giving us some of your time.

Steve: My pleasure, thank you very much.

Russ: You bet. We've been talking with Steve Latham, the founder and CEO of Spur Interactive. This is The BusinessMakers Show, heard here and online at thebusinessmakers.com.