Archive | August, 2011

Value Rating Part 2: Targeting in Subscriptions

In subscriptions, how can a sales manager differentiate the up-sell vs. the retention risk between two customers with same number of page views and visits? Value Rating is the answer, or the percentage of page views that are units of value (full description of Value Rating in Part 1 of series). Using Value Rating as a metric, Scout Analytics has found that categorizing engagement on page views alone, will incorrectly classify the revenue opportunity of 15 percent of customers. The consequence of using page views as a primary metric is that sales managers will use wrong negotiation tactic with customers 15 percent of the time. Chart 1 to the right will help illustrate the limitations of page views only. The horizontal […]

Value Rating in Subscriptions: Part 1

Not all page views have the same value. For that matter, some page views have no monetary value. To illustrate this dynamic, consider the following: would a subscriber be willing to pay the list price of $26 a year to search for product reviews on ConsumerReports.org but not allowed to actually see the reviews? The most common answer will be no. The monetary value of a “search” page view with no results is worth zero. Page views can be placed into one of two buckets, a “unit-of-value” or a “path-to-value.” Unit-of-value – A page view that enables a visitor to make a decision, complete a task, or fulfill a need (e.g., entertainment) delivers value. Path-to-value – A page view supporting […]

Digital Media: The Odd Man Out

July was a quiet month for the blog, but this is a repost from a submission I provided to adexchanger.com.  Look for more updates in the coming weeks. The sciencification of advertising is on a clear, steady march toward greater and greater efficiencies, whether that be optimized cost for advertisers, agencies, networks, or publishers. Behind all the investment and strategy is the idea of harnessing the scale of the Internet. Unlike gaming, social networking, and daily deals, the digital media revenue model doesn’t scale with a network effect. This makes digital media the odd man out. Digital media should take notice, focus on segmenting profitable advertisers, and develop niche advertising strategies. How did scale become so important, and why doesn’t […]