Last year’s guest posts in December were simply amazing.  This year’s are primed to be even better.  Every year, I usually take a break from blogging in December.  More specifically, I take the back half of the month off.  The holidays are simply a tie draining experience and I find there’s just not enough time to put together quality posts.  So, rather than offer you less than my best I reach out to some great minds and see if they can help me out by guest posting.

I’m humbled and thrilled with the wide range of talented people who’ve agreed to lend me a hand this year.  Over the next 2.5 weeks I hope you enjoy the guest posts that offer some really interesting perspectives on everything from FourSquare to Data Backup.  It’s a wide range.

I’ll see you all in 2010; I hear it’s supposed to be the big year for mobile

I’m out on vacation this week.  The keys to TheKmiecs.com have been turned over to a few, select, awesome guest writers.  The following has not been edited by me and is the work and effort of the original author.  I appreciate the time and thinking that went into this post and hope you will too.  Enjoy!

It’s been a week since Denny’s ran their Superbowl ad featuring a free meal and all information seems to indicate a successful effort. The message was perfectly aligned with the economy. In a time when people are being laid off by the hundreds of thousand, offer a free breakfast to everyone in the country.

The company had seen considerable negative change in the past 20 years. They faced lawsuits accusing them of racism, and a growing public perception of inferiority, tarnishing a brand that was once widely known for good value.

Looking to put that behind them, this was an effort to reintroduce people to the value proposition of Denny’s meals. This was a big bet. Failure brings ridicule and questions on why the company spent $3 million on the effort. Success can be equally challenging, as Denny’s learned.

What Happened

Following the Superbowl and on Monday morning, Dennys.com experienced a surge in traffic with people looking for information on the offer and the location of the nearest restaurant.

According to comScore, 15% of all respondents visited an advertisers web site after seeing their web site, and 23% of those respondents visited Dennys.com. With a total audience of nearly 100 million viewers, that would place the number of visitors to Dennys.com around 3,500,000 people. Other reports vary in estimating traffic from a 434% to 1,700% spike. Both sets of figures are reasonable as the bulk of visitors likely came during peak times.

As a result of this spike, Dennys.com was largely unavailable to people after the Superbowl and Monday morning.

A Preventable Outage

It was predictable that Dennys.com would experience a significant surge following the ad. Unpredictable traffic from sources such as the DrudgeReport.com, Digg.com, and Twitter.com can lead to an unforeseen and overwhelming load on web sites, but placing a Superbowl ad requires advanced planning.

Note that Denny’s made the offer for breakfast on Tuesday morning. This may have been intended to give people time to coordinate going to Denny’s. There was clearly thought about the activation and timing of the program, but there was a either a miss in collaborating with their Digital Agency or Technology group, or a lack of experience in handling this type of event.

What Did Denny’s Miss?

It does not appear Denny’s made changes to their web site or hosting arrangement to prepare for the Superbowl traffic. A quick check of their site indicates two key misses:

1. From a brief review of the source code and scans for origin servers, it does not appear there was a Content Delivery Network (CDN) utilized for the site. A CDN reduces the work a web server must do by offloading the amount of work it performs. A CDN such as Edgecast, Akamai, Amazon Cloudfront, or Limelight places copies of the static assets of a web site on ‘nodes’. When a user requests a web page, they are first routed to the assets on these nodes instead of the web server. In my experience, a CDN can reduce the load on a web server by over 90%, while improving response times by up to 45%.The most recent detectable change in Denny’s hosting environment occurred in October 2008 when they upgraded to a new version of IIS. We cannot tell from this information if Denny’s added capacity to their web servers.
2. While it appears some steps were taken to minimize the number of queries required by users, the area most likely to be used by consumers was still partly dynamic (restaurant locator). Search of this type is among the most resource intensive. An alternative would have been to provide static navigation pages (state > city > locations). These could have been easily created by searching with the existing Content Management System and saving the results as static pages.

The cost to implement a CDN varies by vendor and capability, but I would estimate the total cost for both of these solutions to be less than $60,000 for the year.

The Negative Impact to Denny’s

The Internet provides us with enough information to make educated guesses on the impact of the failure. I’ve found it’s useful in the past to use a Customer Lifetime Value scenario to determine the impact of these decisions.

We first need to build a table of our assumptions:

These assumptions are based on public numbers, derived from figures Denny’s has released, some educated guesses, and my personal research on Thursday at the local Denny’s. For the sake of this exercise, we’ll keep this to a one-year analysis and ignore Discount Rate and Product Inflation.

The most controversial figure in this table is the retention rate. With the exception of telecommunications, most companies do not publicize their retention rate. This guess is an average based on estimates ranging from 53 – 85% in the restaurant industry.

Based on these assumptions, we can project that Denny’s would see the following results this year:

For a stated cost of $5 million, $11 million in gross profit is an acceptable return. It also accomplishes the goals of reintroducing the brand to consumers, and the financial impact would not be limited to 2009.

But did Denny’s leave money on the table?

Let’s next assume Denny’s implemented the recommended technology steps at an additional cost, and as a result saw an increase of 5% in the response rate to the trial (to a total of 2.1%). What impact would that have on the overall program?

The most immediate impact is Denny’s would have served 153,300 more customers on February 3. If we follow the same assumptions through the year and add the costs for the technology recommendations Denny’s would have realized an additional $573,879 in profit for the year. That is a 956% return on the technology investment.

Note: These figures also raise an interesting question into what type of retention programs they implemented. With retention driving significant dollars, was the bigger mistake to not leverage CRM?

What does this tell us?

This wasn’t a Grand Slam for Denny’s, but it was a solid double. Denny’s failure here isn’t critical from a financial perspective. The program will likely achieve profitability for the restaurant, and bring new customers into the stores. The idea with any trial promotion is to introduce people to your brand with the hopes a percentage of the trial audience will return and by those definitions, the company was modestly successful.

While the company will benefit from its efforts, I think it stumbled seriously with the online execution. There was no excuse for Dennys.com to be unavailable to users. For a company that has a reputation issue, not being able to serve people online is a failure. They had the advanced notice. Technology is readily available to serve capacity, and they were clearly thinking about the timing.

Located in Chicago, Rob Saker is a Marketing Technology & Analytics professional in the Consumer Goods industry. He can be reached at his blog at www.robsaker.com.

I’m out on vacation this week. The keys to TheKmiecs.com have been turned over to a few, select, awesome guest writers. The following has not been edited by me and is the work and effort of the original author. I appreciate the time and thinking that went into this post and hope you will too. Enjoy!

Marketing is supposed to be all about relationships. Based on this belief, it stands to reason that marketers would want to use media that has as its distinguishing feature being part of the connective tissue that holds people together. Thus the enthusiasm for social media and its ilk.

Lots of different vehicles these days are put under the heading of “social media.” Pretty much anything that can facilitate two-way communications between two or more people could be classified as “social media.” Depending on whom you ask email would technically fall into the category of social media. Depending on who else you might ask, so would the telephone or CB radio.

But the kinds of things that have the interests peaked of those who work at the bleeding edge of marketing are tools and technologies that atomizes our expressions, globalizes their reach, and localizes their targetability all at the same time.

We’ve got Twitter to micro-blog every crumb that falls from the buttered toast of our lives. We’ve got Facebook to broadcast the expression of those crumbs to the Etherverse via TwitterSync. And soon to follow will be marketers using the likes of Loopt or Google Latitude to find us where we are when brushing those crumbs from the fronts of our shirts and send us location-based messages on where to buy the bread, where to buy the butter, where to buy the knife with which to spread that butter, and perhaps where to buy the cleaning agents that can clean the shirts from which we are brushing the aforementioned crumbs.

Micro Blogging
Twitter is awfully interesting. I twitter sometimes not at all and sometimes several times a day. Most of the time, posts I read are not here or there in terms of their relevance to my life. They rarely offer a depth of insight on a given subject. But they are sometimes interesting, funny or just downright cute (one fellow I follow posts only things his kids say). Every once in a while there is a link to an article or a video or some other bit of bytes that lead me to that depth and insight Twitter, due to its character constraints, lacks.

Will Twitter hurt how we think and, thus, act, which in turn will change how we market to one another? Maybe. The structure of our language –even our syntax – dictates how we think, it forms the way we conceptualize; the means by which we articulate the world and what is in it informs what it is we think is in the world.

My concern is that the diminishment of formal structure – be it due to a lack of familiarity, willful rejection of it because of some belief that it is authoritarian or elitist, or a restriction of the characters we can write with — will lead to structure’s eradication for the sake of utility. Utility only and always without at least knowing what formal structure needs to be violated in order to achieve it leads to homogenizing, standardizing and monotonizing.

In an environment where infosnacking and reflex replaces deliberation and practiced experience, how we define intelligence and reason will become unrecognizable.

How can something like this be tamed for marketing?

Facebook, MySpace, et al
Marketers are drawn to social networks as an adverting vehicle for the same reasons they are drawn to any media vehicle: the size of its audiences and the popularity it enjoys. That does not, however, always translate into viability as a means for delivering advertising. Toilet paper, after all, is also rather popular. Certainly everyone I know uses it. But I have yet to see ads on it. This is not to equate delivery systems, but rather to demonstrate that widespread use is not a sufficient condition for carrying an ad message. There are reasons why social networking properties should be approached with care:

• Social networking is just a communication format, not a media vehicle; per se. Social networking is the first decade of the 21st century’s email. Aside from being a domain, do any of the free online email providers, even Gmail, really have a brand? Do any of them offer any specific value to marketers looking to advertising that can’t be had anywhere else? Not really. What they offer is scale (the audiences are huge) and some targetability. Certainly the kind of information available about users will lend itself to greater levels of targetability, but as we’ve already seen, the community is going to police itself against that targetability going too far.
• The relationship aura an advertiser might hope to benefit from doesn’t always really exist there. It’s a place where people allow others to be connected to them, but they don’t really have relationships there. While expanding the number of “relationships” we have, it degrades their quality for the sake of quantity. Like slicing a peach, with every cut, you lose some juice.
• Advertisers will have to compete with the brand of ‘Me’ in a social networking environment. Social networking is really a platform for self-branding. People are opening their kimonos to show off their rock-hard abs or their gorgeous breasts or the funny image they shaved in their back hair. It is an opportunity for a kind of narcissism that doesn’t ostensibly put us at physical risk. A Facebook page is like driving down the street with the radio turned up loud and the windows down; it is wearing a concert T-shirt; it is a way of advertising who we want others to think we are.
• People in marketing and advertising always like to think that the general population likes what we do as much as we do. The general population’s relationship with advertising is at best one of managed hostility, regardless of what one might say about it when the advertising message coming to him or her has been sent by their “BFF” (Best Friend Forever). Will an ensuing deluge of advertising — whether or not it was endorsed by the Lil’ Green Patch friend of a friend — be accepted?

Location Based Services & Targeting
There are as lot of GPS-type applications out there now that, with the growing popularity of smartphones, is experiencing their own surge in popularity. This has the marketing community talking about whether apps like Loopt, Google Latitude, Navteq and others can be used to serve advertising to people based on where they are.

First of all, aside from helicopter parents who might want to know what their kids are doing at every second, are these tools even valuable? Knowing my friends are near is quaint, but, if I’ve already mediated my relationship with them to the point where I’m only communicating with them by posting a note to their Facebook wall, which in turn sends an email to them to tell him or her to go to their Facebook page to read the note I left on their wall, am I REALLY going to make the effort to see them and have a beer, physically, even if they are a few blocks away?

Second, the long-held belief in advertising has been that location somehow makes advertising

a) more meaningful

b) more relevant and thus

c) more effective

But does it? Just because I’m near a McDonald’s doesn’t mean that I’m ready to eat there. Knowing where stores are is valuable, but that’s search addressable more than it is advertising. I think we in advertising and marketing overvalue the tricks of targeting. Most people have a relationship with advertising that is on average one of managed hostility. I don’t know that “adver-stalking” would endear a brand to a potential consumer. I suppose it could operate on an opt-in basis and entice purchase or trial with incentives. But I have my doubts about a marketing application.

What’s the solution to all of the above? Marketers’ least favorite form of advertising due to its lack of forced reach and potential glamour, but it is among the most effective: “Pull” advertising.

It’s what search is, yellow pages used to be, and what widgets are becoming. You approach the opportunity as one where the audience you are trying to reach reaches out to you instead of you reaching out to them, then you’ve got something here.

Jim Meskauskas
VP, Director of Online Media
ICON International
www.twitter.com/mediadarwin

I’m out on vacation this week. The keys to TheKmiecs.com have been turned over to a few, select, awesome guest writers. The following has not been edited by me and is the work and effort of the original author. I appreciate the time and thinking that went into this post and hope you will too. Enjoy!

From now on, every time you consider the potential for an interactive initiative, you must ask what your audience will be asking:

What can I do with it?

Think back to the story of Green Eggs and Ham. You’re asking someone no try a new idea, and then use that information in a variety of online and offline settings that make the most sense to them.

Merely presenting information is no longer enough. Your audience needs a clear, convenient way to do something with it. Can they use it on a plane? On a train? In a house? With a mouse?

This isn’t over-simplifying: it’s clarity. Your content is best used someplace else. Rhyming makes it more fun. Where is your content best suited? What kinds of content are most used in that place? This will take some investigation, trial and error. The best part about this investigation process is the incredibly valuable surprises you learn along the way. Making your content clean and passable will create its own sidewalks to audiences you never knew existed.

The relationship between Sam and his nay-saying nemesis became stronger once they shared the meal. Green Eggs and Ham is the tie that binds them. There’s no difference between that experience and sharing new content with friends in Flixster, MySpace, or YouTube. It’s the power of discovery.

Helping people share makes their own relationships stronger. We call these social objects today. Regardless of what term we apply, people will continue to look for these opportunities to show something new to a friend or colleague and make a stronger relationship with that content.

Don’t be afraid to show people how to use your content. Give examples. Sam demonstrates every conceivable way to eat green eggs and ham. So should you. Demonstrate the ways that other similar people have used your content. Today we call this social proof. It helps a lot when you can see people like yourself taking specific actions.

FriendConnect and Facebook are both great tools to show your content in the context of friends: making the mental leap of doing something new feel a lot smaller. Letting people share what they find, and putting it in their own terms is the most powerful marketing you’ll never have to buy. Green Eggs and Ham is just one of the stories that have lasted for generations by demonstrating the most entertaining, memorable ways of doing just that.

Thanks to Steve “Doc” Baty (Meld Consulting) for his help on the post.

Michael Leis is a strategic consultant connecting brands, technology, and people. Find out more at http://blog.michaelleis.com or on Twitter @mleis