Larry Becker from The Rimm Kaufman Group – Podcast Transcript

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Shaun Ryan: [0:03] Hi. I am Shaun Ryan from SLI Systems and this is the E-commerce podcast. Today, I am speaking with Larry Becker from the Rimm-Kaufman group. Hi Larry.

Larry Becker: [0:11] Hey Shaun. Thanks for having me.

Shaun: [0:14] Hey, you are welcome. Now, here is my traditional first question. What was the first thing you ever bought online?

Larry: [0:19] You know, it is something that is sadly rather unexciting. It was in fact a book, and probably from Amazon some time around ’99 or ’98 if those numbers jive with reality. I believe, it was a book called “Webonomics,” which was based on an article in “Wired” that predicted the rise of the web economy with some accuracy too.

Shaun: [0:49] Cool. Cool. That is great. Now, Larry, can you give me some background about yourself?

Larry: [0:56] Sure. I work for a company called the Rimm-Kaufman group and we are an online marketing agency that specializes in paid search marketing and website effectiveness consulting. That is making your site sell more.The first has been around for about three and a half years and we were just recognized as one of the fastest growing companies in America by the Inc. 500.

Shaun: [1:23] Congratulations.

Larry: [1:27] Thank you. My role there is I head up our consulting practice empathizing usability and conversions. In other words, once you pay to drive traffic to your site, how do you make sure you bring maximum value out of every visit?Our primary clientele are online retailers. We serve about 100 folks in that area. We also work, especially on the consulting side, with some folks in the B2B space as well.

Shaun: [1:50] All right. What is your background? What did you do before you were at the Rimm-Kaufman group?

Larry: [1:57] Prior to joining RKG I worked on the retailer side for about a decade. I was with Crutchfield Corporation, the consumer electronics retailer. I started out there as a salesperson and got involved in the web and served as VP of E-commerce there for several years before joining these folks that I am with today.

Shaun: [2:19] I imagine that would have given you some fantastic experience from your customer’s point of view.

Larry: [2:24] Yeah, I think, what is interesting about our firm is all the principles are former online retailers. So, we definitely have a sense of what it is like on the other side of the desk or email exchange and really understand the issues that our clients are facing.

Shaun: [2:41] Excellent. So, can you tell me a little bit more about the customers? What sort of problems do they have when the come to you, specifically on the consulting side that you head up?

Larry: [2:53] Sure. I think that there are two levels to it. I think, most folks understand that their site could probably sell more, and that would bring greater efficiency to their advertising spend and all sorts of good things. But, how does one know where to start? Which changes are worth making? How do you prioritize and how does one really get into the customers head?Online retail is great that it is a very metrics driven business, but I think sometimes retailers lose sight of really getting into dialogue with their customers and experiencing their sites the way that the online shopper actually does as a real live human.When we work with a client, we help them benchmark their site against some very specific and detailed best practices. We also spend time shopping their site for their most important products as the users do. We also actually get involved with some live user testing as well.So, the problem is “What should I change?” And the solution is really taking a deep dive into the site, and then looking at the cost benefit of the different changes that can be made.I think that another challenge is that in the paid search space, there is some synergy here because as cost per click naturally continues to rise, just as it becomes more competitive, I think retailers and other advertisers are realizing that the more that one can increase dollars per session, usually in terms of conversion, that their value of advertising spend is ultimately bringing.As anyone knows, you reach a point of diminishing returns in terms of the most cost efficient clicks you can buy. Then, it is really what happens once you get to the site.

Shaun: [4:46] Yes. I imagine you must see a huge variety on the different retail sites. Some retailers who have put a lot of effort into it that are just going to make some incremental improvements and others that can make some huge improvements that haven’t really considered this before.

Larry: [5:02] I think, the case is fairly rare where the best course of action is to tear down the site completely and start again. Those days of the raise it to the ground and the start again redesign are over. It is a lot more effective to make incremental changes to your site on a project based or task-based basis and then be able to measure the outcomes. You can also target the areas that have the greatest impact on your conversion and your sales without expending resources on areas that simply aren’t as important to your customer or your business.

Shaun: [5:40] Right. Now, you must see some trends across your customers. What types of improvements are common things that are incremental improvements?

Larry: [5:50] I think, they can fall into various categories. There are changes that have to do with layout; making sure a call to action is visible and scannable on every page. There is the role that headlines and copy play in making that call to action persuasive. And I think, for many of our clients, it is getting that understanding that user experience isn’t only the mechanics of usability, but it really is “Does the site do a good job of conveying a reason to buy here as opposed to from your direct competitor?” For most of us, we are selling something that is more or less commoditized, if we let it become that.So we help folks understand that the mechanics need to be in place, and we can give specific direction there, but really let them look at their site along with their direct competitors and help them bring their selling proposition more to the foreground and make it a bit more compelling.

Shaun: [6:54] Right. Now do you see a variety of technologies employed on the E-commerce sites or are you seeing some common technologies that are used across a lot of your customers?

Larry: [7:07] In terms of technology? That is a good question. Many of our customers now… I think, it is typically one out of four customers are always sort of redesigning or looking at re-platforming. So, people are looking at those decisions. The technology decisions that they are making are often to do with cart, platform, and site search. As you know from your business, there are a few large players into those and they are always new competitors coming out.I think, one of the challenges for online retailers over the last couple of years now, is really making sense of all the new technologies that fall under the Web 2.0 umbrella, and finding the right applications on their sites for things like; AJAX, and actual Web 1.0 technology, but it is now called “2.0,” would read reviews and user generated content.We see that dust beginning to settle, and some folks making very good use of AJAX and seeing what’s frivolous for user technology for technology’s sake. I think, the smartest folks are always relating it to a way to actually make it easier for their user to complete a critical task on their site, whether it’s adding something to their cart or posting a review.

Shaun: [8:29] Yeah. Some people shouldn’t be saying, “I want to have AJAX on my site.” They should be saying, “I want to achieve the same goal, and AJAX might help me achieve that.”

Larry: [8:38] Sure, and do technology agnostics. Look up the task that your customer needs to complete in order to meet their goals and your business’ goals, and then you use the best possible tool for that individual task. I think, most folks are past iCampi.

Shaun: [8:56] Yep. So, what do you think is going to be changing over the next year, compared to the last year?

Larry: [9:04] I think, over the next year, we’re going to see more and more folks realizing the importance of converting, in terms of making their advertising effective. They’re going to want to make sure that they have an effective cost efficient means of driving people to their site – that hasn’t changed.As we said earlier; with rising competition; having discreet tactics in place to really get the most out of that visit, being able to test different experiences on your site, and being able to have a very clear idea of which changes on your site will matter and which should be left for further down the road.

Shaun: [9:45] OK, cool! Larry, do you have a site that you particularly admire, whether it’s one of your customer’s or not, and why do you admire it?

Larry: [9:53] I don’t have any one particular favorite site. If there was a question that a little – because the people will ask that, I think there’s a difference that sites succeed for different features and will reuse them.So, I’ll mention some sites though that are timed and some that are not. I like the “Old Navy’s” use of AJAX in terms of their corp. and their whole family of sites; that the way they have used new technologies to enhance the actual experience of buying a product. It’s done very smoothly, and they’re consistently using technology to help people shop in very specific manners.I love thinking of “Musician’s Friend” and their Stupid Deal of the Day, where they have a great viral way of getting folks attuned to the site at all hours of the night when their one massively discounted product goes on sale everyday, and they really understand how to speak with their customer in their own language.As a former musician before I got into this field, I understand that often in selling musical instruments is about selling expensive things to people who have no money. So, it’s interesting to see people succeed in that.I think, it’s important to look outside the space too, at the fact that the New York Times always has most emailed articles as really to change the way that I read headlines. I no longer necessarily go to the headline first on a page as one typically would, I go down to that little box and see what the wisdom of the crowd if you will, has to say about what’s important in the world today.

Shaun: [11:30] Excellent, thanks! There’s some great examples there. Now, what do you see are the biggest opportunities online?

Larry: [11:39] I think, the biggest opportunities online are for retailers who can really begin to incorporate the voice of the customer when they make decisions about, “What’s really going on with this site?” Blending that in with quantitative click stream information they have, and then being able to make those targeted surgical changes to their site, and then measure to see what happened and what has impact.If people… I feel like I’ve repeated myself a little in these few minutes, but that emphasis on “You’ve pay good money to drive traffic to your site, but are you getting full value from each visit?” The folks who really come up with concrete answers to that question, either their own or with their partners, are going to be the ones who not only won on their site, but won in the advertising game, because of course conversion rises, you can afford to buy higher position on your [inaudible 12:40].

Shaun: [12:41] Yeah, now I understand it. It makes a huge difference, not just to your paid search campaigns, but to the effectiveness of your search engine optimization, and any other marketing campaign you have driving traffic to your site. Now, just a quick question about your customers; what size of retailer use your services, is it a variety or is mainly the larger retailers?

Larry: [13:07] It is a variety. On the consulting side, I would say it’s folks in the range at $10 million a year and end up in revenue, although certainly some smaller folks as well. On the paid search sites, because they’ve put the scale, folks tend to be a bit bigger when it makes sense for them to really outsource those surfaces.

Shaun: [13:31] Yeah, so what sort of size paid search campaign would use your services?

Larry: [13:36] We’re quite open about our prices. We charge 12 ½% of media spend, with a monthly minimum of $3000 a month in fees, and a monthly maximum that’s pretty unique among agencies of $12,500 per month. So, you just have to see how much you’re spending a month to see whether those fees make sense.

Shaun: [13:59] Right. OK, now that’s great. So, I think, you’ve given us some really valuable information there Larry. Is there anything else that you think retailers would like to hear on Ecommerce Podcast such as this?

Larry: [14:15] I think, it would be really interesting to interview some retailers, and hear straight from the retailer’s mouth what are some of the challenges that they’re facing. I know that from the questions that we ask and answer, that retailer’s are really interested in hearing how their colleagues are evaluating different technology solutions. I know that platforming is a really hot question perennially as well as just, “How do I come up with the changes that matter to my site?”

Shaun: [14:49] Those sound like great things for me to be doing. I have been interviewing a lot of retailer’s, and it’s really interesting the types of things they’re coming up with, and it’s great to hear their recommendations.So, Larry I just want to thank you very much for taking the time to talk to me today.

Larry: [15:04] Thanks for the opportunity.

Shaun: [15:05] That was Larry Becker from the Rimm-Kaufman Group, and I’m Shaun Ryan from SLI Systems for the eCommerce Podcast. Thank you!