Friday, March 1, 2013

SimplePart Newsletter: February 2013

Welcome to our News and Update wrap-up for February 2013.

This month, SimplePart was recognized by Google as an AdWords Certified Partner. This elite program acknowledges industry-leading digital companies who have demonstrated the ability to generate strong returns for customers using online advertising through Google AdWords. SimplePart is the first and only provider of turn-key online auto, motorcycle and truck parts catalogs to Dealerships and Aftermarket sellers to be a Google AdWords Certified Partner. Google’s comprehensive AdWords Certification program involves extensive training, testing and ongoing education programs – SimplePart is proud to be a Google AdWords Certified Partner and congratulates SimplePart AdWords team lead Lance Huynh on his achievement.

Overall 2012 Performance
SimplePart reported on its 2012 annual performance this month. In summary, during 2012 SimplePart generated $5.78m in online sales for its customers – a 120% increase over 2011 – and served 11,947,519 unique website visitors. For more information on SimplePart’s 2012 performance please see the newly redesigned

Maintenance Products
I’ve mentioned over the last few newsletters that we have been making changes to both catalog and presentation to enhance sales of popular maintenance items – filters, belts, brake pads, etc. I wanted to take a minute to highlight the impact of those changes on sales of these popular, but competitive and hard-to-sell items.
·         Daily orders for maintenance items have nearly doubled since we began our work
·         In July of 2012, a peak performance month, 0.013% of visitors purchased a maintenance product
·         In February of 2013, typically a much slower month, 0.020% of visitors purchased a maintenance product

Below is a graph showing daily orders which include maintenance items since July of 2012.

We continue to work on improving sales of maintenance products, and will keep you updated on the impact of these changes.

Our Performance
During our busiest day in February we served more than 5,200,000 page requests, and averaged 5,000,000 daily page requests. We are seeing 1,500,000 unique human monthly visitors. What this means in practical terms is that during February we saw as many as 2,200 searches in one minute, and as many as 6,200 products viewed in one minute – in our busiest minute we saw 7,800 page requests of all types.

There were no outages during the month of January, though we did use our maintenance window in the early morning on 2/28 to perform some system maintenance and upgrades, and ran on our secondary systems for a few hours during that process. This window gave us a good opportunity to exercise our second-tier gear and confirm it will comfortably carry a production load. As you may know, we are redundant across several levels – each is a “hot standby” and capable of carrying the full system load.

Industry News
Google Changes
            There appear to have been no significant Google updates to Search algorithms during the month of February.

Google and Yahoo have signed a “global, non-exclusive” deal which allows Google to show its ads on key Yahoo properties. Yahoo’s strength is in editorial content – explicitly written and curated pages about commonly searched topics. They describe this Google partnership as a means of providing better contextual advertising on those pages. Microsoft’s Bing is already providing Yahoo’s search results, and now Google has their foot in Yahoo’s door towards taking over the advertising Yahoo shows.

Analysts at Morgan Stanley believe that Google is paying Apple roughly $1b per year to be the default search engine on iOS devices including the iPhone and iPad. In order to maintain its majority control of the search market, Google pays a number of companies to be their default search provider, next most notably Mozilla ($400m annually) for its Firefox browser. Apple accounts for 31% of Google’s total expected annual traffic acquisition costs of $3.5b.

This expenditure gives Google these users to advertise to (95% of the mobile search market), and collect information from – it is predicted that by the end of the decade Google will be paying close to $6.8b annually to acquire traffic.

Think about Google’s traffic acquisition costs (TAC) in terms of what you pay Google to advertise to these same users, and what Google spent to develop and market Android phones and tablets as an alternative to Apple devices. How much of Google’s plan with building Android might have been a design to offset future TAC expenses from Apple?

Mobile-friendly marketing emails
A recent study performed by marketing firm Knotice finds that 41% of marketing emails were opened on mobile devices in the second half of 2012, up from 36% in the first half. As many of you are using email campaigns to connect with customers, this study drives home the importance of ensuring these emails are optimized for display on mobile devices – and that the links you show in those emails lead to pages which are also mobile-friendly.

During the second half of 2012, 28.98% of marketing e-mails were opened on a smartphone, 12.10% on a tablet, and 58.92% on a desktop or laptop PC, Knotice finds. Among smartphones, 21.53% of all e-mail opens occurred on an iPhone and 6.00% occurred on an Android phone, the study says. The remaining 1.45% occurred on other smartphones. Among tablets, 11.46% of all e-mail opens occurred on an iPad while 0.56% occurred on an Android tablet. The remaining 0.08% occurred on other tablets.

That means 32.99% of all marketing e-mails were opened on an Apple Inc. device during the second half of last year, while 6.56% were opened on a device running Google Inc.’s Android mobile operating system.

Knotice’s reporting of these statistics is driven by an image tag displayed in the email message. This tag is only loaded if the user clicks “show images,” which is a far more prominent button on desktop computers than on mobile devices. This means that the numbers here may be under-representing mobile devices.

IRS Form 1099-K
IRS form 1099-K, introduced for the 2011 tax year, requires third-party payment processors to report annually on the dollar totals it has processed for each client. Processors will fill out 1099-K and send a copy to you, and another to the IRS. The list of third party payment processors includes not only Visa and MasterCard providers, but also PayPal and Google Wallet among others. “Payment service providers” like PayPal only have to report if you’ve done more than $20,000 in business with them that year. Credit card processors must always report. The IRS uses these forms to ensure business compliance and accurate reporting of business income. This is affecting many online merchants, and should be on your radar if it’s not already.

Online Sales Tax
The most recent incarnation of online sales tax legislation, called the Marketplace Fairness Act of 2013, again proposes updates to legislation governing how online merchants must handle sales tax for orders shipped into states where they have no physical presence. This new bill applies only to merchants with annual sales outside of their home state in excess of $1,000,000 and expects to increase sales tax collections by around $20b annually.

Tips for this Month
This month I would like to encourage you all to consider new (old) ways to reach out to customers.

One of our customers sent out a simple email to its 5,000 past online customers thanking them for their business, updating them on dealership news, and offered them a coupon for $10 off their next purchase of $100 or more. Within three days of sending that email message, they had $900 in web orders come in which used that coupon code.
We would be happy to help you extract customer email addresses for anyone else who’d like to try this out.

We have also designed slick color flyers for several of our stores, which they are printing and packing into each outgoing order box. The flyer thanks the customer for their order, includes a coupon code for the customer to save on future orders, and encourages customers to share that coupon code with friends and through social media online. They’re not only a great garage-wall reminder to encourage repeat business, but the shareable coupon code is a wonderful way to incent customers to recommend your website to their friends.
We would be happy to put together flyer designs for anyone else who’d like to try this out.

New Features Just Released
1.       Assembly page image alt-text now includes user-specified fitment information for better organic rankings for assembly pages
2.       Date display format on fraud-warning cleaned up and standardized
3.       Notification icon added to product details page for products with a core charge
4.       All website buttons have been standardized, and many are now displaying in a way that allows their text to be translated by Google Translate for customers browsing from different countries
5.       Ability has been added for customers to create custom landing pages through the control panel. These can be fully controlled using a WYSIWYG editor, and are linked in from your home pages for search engine crawl.
6.       Production SQL Server memory doubled
7.       Production SQL Server OS upgraded to Server 2012
8.       Second-tier SQL Server memory doubled
9.       Second-tier SQL Server OS upgraded to Server 2012
10.   Dedicated Reporting SQL Server installed and currently undergoing testing. Expected transition for reporting during March 2013.
11.   New Cisco firewall and switch hardware testing is finally getting close to readiness. The original hardware had flash memory problems that caused frequent, unexpected restarts of the gear in bench-testing. It has taken *months* to work with Cisco to get these resolved, and we’re finally close to implementation. We hope for implementation during March 2013.
12.   Extensive second-tier hardware testing performed to validate our failover model.
13.   Order follow-up emails are now delaying 5 days from date of shipment instead of 3
14.   Reporting Changes
a.       Keyword traffic reporting data extended back to 2010.
b.      Report added for Google keyword traffic daily average by week
c.       Report added for Google product page entry click parameter detail
d.      Report added for Google assembly page entry click parameter detail
e.      Report added for Google landing page entry click parameter detail
f.        Report added for Google Referrer Orders
g.       Report added for Google Assembly Page entry click orders
h.      Modifications made to Net Profit by Day, Quarter and Week
i.         Net Profit by Month added

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