The article outlines key principles behind successful emails, listing things such as having clean layout and a clear call to action. The idea being that if you follow these guidelines your emails will be appealing, and people will respond more to them.

In our experience (and that of loads of other companies) it’s not just about making things look and sound great to get the best results, you need to go one step further and it’s all about testing – testing everything you can.

A/B Testing

Many of you have probably heard the term A/B testing or split testing. You can do it with websites, emails, phone calls and even the homeless. In the case of email, the most basic way to A/B test something is following these steps:

1. Identify a goal you want to improve on, e.g. increasing replies or clicks on a link
2. Make sure you can measure the result by using things like promotion codes, different link destinations or cool marketing software that does it all for you
3. Send half your customers the original email
4. Send the other half a slightly modified email
5. Check which email version improved your goal the most

Just remember, while you might be tempted to make lots of changes to improve your goal faster, it’ll be harder to determine what particular change did the trick.

Here’s what we did

We decided to A/B test something that’s just a small thing and often overlooked – the email subject line. We wanted to see if a company name at the start of the subject line encouraged more people visit our website.

Version A (red) had no company name in the subject line, and Version B (blue) had “Xero -“ added to the start of the subject line.

Having the company name in the subject line saw more people open the email, but the difference was so small it’s unlikely it meant anything. However, by not having a company name in the subject line meant we received around 70% more clicks through to the website.

What does this mean?

There’s a bit of guesswork in reading the results. Sometimes the answer is clear – a bigger button might attract the reader’s attention more. In this case it may be that the email felt more personal and human without a company name at the start, and people were more receptive to the contents of the email. Or it could’ve been sheer luck, and by sending the email again to a few thousand more people we’ll see the new data start to average things out to show a smaller gain.

The important lesson to take from all this is that by continually testing and measuring everything, even the very small things, you can discover your own best practices in everything you design. On their own these percentage improvements may seem tiny and disconnected, but compounded over time they can have a huge impact on the success of your business.

Things you can start testing now:

• Graphics
• Colours
• Call to action
• Headline
• Page copy
• Arrangement of email elements
• Timing – try sending emails at different hours or on different days

Since then we continue to be amazed by how much Social Media is impacting marketing and communication with customers and prospects.  Now, more than ever, Directors need to understand the impact and possibilities for Social Media in their businesses.

The issue is out now and available here for download: Embracing Social Media: Is it good for governance? (pdf 1.3Mb).

I’ve tried to give a few suggestions on how to get started.

Hopefully it’s a useful conversation starter.

It’s a comprehensive toolbox of communication resources encompassing guides, pre-approved content, as well as hints and tips including steps to get online, how to introduce Xero to clients and even how to select a design agency. It also features examples of web landing pages, letters and advertisements.

We’re thrilled to see partners embracing this resource – there have been loads of requests to support initiatives such as client events, sponsorship opportunities with various verticals that a firm specialises in, co-branded collateral and ads.

This week, Xero Gold Partner Xpress Accounting launched their website which as you can see illustrates the partnership and co-branding.

Here’s what Principal of Xpress, Eric Bolt, had to say about Xero driving business to his firm.

When you open the Xero tool box not only do you find all these great resources, you also get a great team of people who are there to help you construct your project.

I love technology. I’ve loved it since I was around twelve years old when I first read about the then revolutionary IBM PC, the ill-fated Apple Lisa and the groundbreaking Apple Mac in magazines like Personal Computer World.

Twenty-one years ago this month I got a job selling bookkeeping software that shipped on 5.25” floppy disks to small businesses. I was successful not because I was an accountant (I’m still not) but because my natural love and passion for technology – yes, even bookkeeping technology – was occasionally effective in persuading small business owners to acquire this same passion about bookkeeping software and to get out their chequebooks.

But for the mere fact that it was customary to be paid for doing such a job, and that I had a landlord who didn’t quite share my passions, frankly I would have done it for free.

My passion for technology and its transformational abilities are what led me to join Xero last summer, but it’s also the source of teeth-gnashing frustration when I read about the collective confusion surrounding the future direction of software, the cloud and online apps.That there is such a persistent aura of confusion is curiously ironic given the very foundations of computing are binary; something’s either on or off, a one or a zero. But large portions of the computing industry seem so able recently to be fluently ambiguous about the future direction of software.

Every week or so another opinion piece or article is penned or a remark is made about whether online software represents the death knell for classic hard disk based software, or whether it’s just a cutesy phase that will soon fade. The resulting monumental mess of understanding is something that’s often characterised as a debate, but for me this unfairly legitimizes what is fundamentally just commercial propaganda much of the time.

I usually prefer to take the high road and let our success do the talking, but after speaking with someone today who was just totally bewildered after having spoken with a classic software vendor about pseudo-hybrid-virtualized-models and rinky-dink cloud versions of CD based software apps, I could no longer contain myself and I decided that it’s time for some inconvenient truths about the future of the software business.

1. I’m paid to tell you that the future of business software is online but I also hold it to be a fundamental personal belief.
2. I’d wager that nowhere in the developed world has a software company been formed to develop and bring to market a new CD based business app in the last three to five years. Most likely longer. I’ll do something humiliating for charity if I’m wrong about that.
3. Conferences, websites, publications and books are not springing up from every direction about the limitless future opportunities for developing and launching revolutionary new apps that ship on CD and which you copy to your hard disk in order to use them.
4. The opposite is true for online, web, Software-as-a-Service, cloud development world. You can’t move for tripping over another new cloud based start-up today.
5. When software executives talk apparently with conviction and authority (they’re technology experts, right?) about hybrid models, the ‘best of both worlds’ or cloud apps being a trivial ‘souped-up’ way of describing good old fashioned software that’s only different because it’s accessed over the internet instead from your hard disk, then in my view they cease to hold the right to call themselves software executives. They’re just executives.
6. Many software businesses followed Microsoft’s lead in this regard by mimicking Microsoft’s Software plus Services strategy-cum-mantra when it first emerged around seven or so years ago. Software plus Services was really Microsoft’s best-of-both-worlds way of saying, ‘Look, we totally get that the web is the future of software but – between you and me – we’re kinda still working on it so please keep buying our old apps with a dash of web on the side and we’ll let you know when you (well, really, we) are good and ready for the real deal.’
7. In a high profile speech last month on the future of its products, Microsoft CEO Steve Ballmer quite notably never once uttered the phrase Software-plus-Services but instead chose to redefine Microsoft’s new and total commitment to the cloud computing as being ‘all in’. Microsoft will ship a new version of Office this summer complete with cloud versions of Excel, Word and PowerPoint. Join the dots.

Customers look to our industry for guidance, help and for people in which they can place their trust. And so it really gets my goat when some of the so-called technology advocacy coming out of established software businesses deliberately compromises that relationship in favour of protecting their own businesses ahead of those of their customers.

I feel better now.

3Bit recently appeared in our solutions directory.

We’re stoked that our partners are getting the benefit from our ecosystem and we see a virtuous circle sending plenty of  love back. Interesting in Nates tweet is the comparison of social media to traditional paid for advertising.

A social media strategy is not free – it’s a different investment. A few in our team spend a lot of their time on social media and wherever possible we mutually promote our partners and try to write interesting content that add value or start a conversation. We’re learning a lot as we go along.  In hindsight too I think we now know that it takes a while to build a critical mass.

However examples like this from 3Bit show that social marketing is blowing up traditional advertising business models. While it may take a while, social marketing has to be a key part of the marketing strategy for any business that wants to grow cost effectively.

Anyone who knows us knows we compete pretty hard against MYOB. MYOB is one of three incumbent winners of the Windows generation of installed desktop software. In Australasia MYOB won, in the UK Sage and Intuit in the US. We have nothing personal against MYOB, Sage or Intuit. They have nice people working there and they no doubt mean well, but as business owners ourselves we found that using their desktop software in the early to mid 2000′s was sapping productivity and made the administration side of running a business too hard. We thought we could do a lot better.

We also saw a fundamental shift to web based applications where business owners and accountants could collaborate on a single copy of the clients financial data.

MYOB, Sage or Intuit have done a lot of growth by acquisition.  By the early 2000′s they all had a broad set of acquired products with different code bases and teams.  Having a lot of experience in the software industry, and having sold businesses into public companies our hypothesis was that the incumbents in small business desktop software  had lost their ability to innovate and would find it hard to move into the next generation of web based software.  So far that assumption has been proven correct – though we expect to see new web offerings this year.Writing software is what we do. It’s still a challenge.  But our biggest challenge is getting known. It’s marketing.

One of the many things I learned when involved with TradeMe, was the strategy of attaching yourself to a competitor. TradeMe, led by the master MOD, was sensational at this as they challenged new markets.  Whenever the incumbent got press, TradeMe got a mention.  Already some new companies are attaching to Xero as well which I quite like as it’s an indicator of success and builds our credibility.

Therefore a marketing strategy for Xero has been to link ourselves to MYOB. It’s been useful to have a direct competitor to sell against.  Over the last few months we’ve made a few inroads into the Australian market. One of the best things that MYOB did for us was conduct a survey to all of their partners mentioning Xero. Then a couple of days ago the CEO of MYOB did this video interview for BRW magazine.

These examples show the power of the ‘attach to your competitor’ strategy. We could not have paid for a better targeted message.

In the early days at Xero we dabbled in traditional mediums of print and press with no measurable success. Of late, we have been getting superb results online. But we wanted to overlay this with something that would also raise awareness of our accounting partner channel, particularly in New Zealand as we lead into the financial year end of 31 March. So we’ve  launched a radio campaign to run in Auckland, Wellington and Christchurch.

There are two ads –  the first is based on a testimonial from one of our customers, photographer Eva Bradley (above).  This is followed with a referral to our homepage to find a Xero Certified accountant – where we’ve created a tile that links through to our Partner Directory.

Here are the ads – tell us what you think. (They’ll play on The Rock, Classic Hits, Newstalk ZB, The Breeze, Radio Sport, Radio Hauraki and Radio Live.)

30 sec ad

15 sec follow-up ad

This is a great way for small businesses to promote themselves. Authentication is by a phone call which usually happens pretty quickly.

It also allows photo’s and images to be loaded.  This is a great way for small businesses to differentiate.

Google are a winning search engine and we expect to see many new applications built on top of this directory data. Therefore we think it’s very important that you take control of how you are presented in search. Its simple enough to do yourself or talk to your website provider who should be able to quickly set you up.

http://google.com/lbc

I’m enjoying seeing how quickly accountants and bookkeepers are developing their game on the branding front. Jenny is one of our great new partners and is just launching her new brand.  I thought her new card was particularly good …

Also enjoyed meeting a bunch of smart people at the Future of Money conference where I was live tweeted (eeek!). Thanks Charis for putting on such a great event. I covered what I think of as Banking 2.0 – where banks expose more and more service points as webservices s0 that solution developers like ourselves can consume and integrate those services into seamless workflow improvements for small businesses and consumers.

Like as has happened in the Telco industry – the walled garden model is under pressure as advances in the cloud start linking into these core transactional systems.

Telstra is helping us spread the word with a very nice online campaign and even full width print ads in the major papers. These help build credibility with partners and are building our brand awareness in the Australian market.

It’s always a buzz spending time in Australia.   I especially enjoy the quantity and quality of the daily business coverage which promotes much more interest in business and you get a real sense of the opportunity that comes with scale.

With our partner base coming alive I’m looking forward to spending more time on the ‘West Island‘.

But as we discovered in an internal session recently, the measure of just how good that conversation is, can be quite subjective…

My challenge was thinking what I could tell such an experienced group about technology that would be relevant for Public Company Chairpersons.

I talked about social media and especially Twitter.  Boards of Directors need to know about Twitter. Let me explain:Twitter started off as a pretty banal thing a few years ago.  In 140 characters you answer the question: “What are you doing”. Here’s what the standard Twitter entry screen looked like:

A typical series of  twitter posts might go like this:

• Just got out of bed
• Making toast
• Putting vegemite on my toast

Twitter went nuts and now has over 50 million users.  Companies started to use Twitter over Google Adwords because Twitter was providing great opportunities to talk to potential customers. This guy might be a candidate as an example:

You soon learn people don’t hold back on Twitter.  It is as raw as that. Cringeworthy but a good sales lead. Don’t worry we’ve had some rough ones as well.

A month or so ago the front page of Twitter changed. Profoundly. See if you can spot the difference.

Twitter hit critical mass and suddenly what Twitter was useful for flipped around.

See what people are saying about … YOUR COMPANY

Twitter has become a real time social graph on almost every business of significance.

Before Twitter, if you had a disgruntled customer, they were hidden in your call center queue. Now they have a voice than anyone can hear and even find some time well after the event.  And if you don’t join the conversation they still keep shouting.

So for the company Chairperson and Boards in general they have new risk surfaces they need to consider.

1. What is being said online about your business?
2. What are your risk minimisation strategies for dealing with social media?
3. What additional resources are required to work with social media?
4. Do we have an open culture that listens and responds to customers?

Before a board meeting you might just do a Twitter Search and be armed with the perfect question to the CEO

The executive team need to determine who in the business is authorised to engage online.

Significant companies are engaging on Twitter.  This exchange between a customer and one our partner banks was fascinating …

A conversation we were having with a technology group inside the bank is surfaced by a customer and the bank is forced to respond directly. Doesn’t that change the dynamic?

Just today another interesting example.  Real time, public, performance monitoring of our Sydney account managers:

Isn’t that wild? What if she had of said “Just had two clowns in from ….”?

Twitter is a great example of how business is changing so fast in the connected world.

Our strategy is to engage.  That is a real commitment but we feel it’s an investment we need to make. As we are a new company and we are growing quickly we can keep on top of it.  Our market is a word of mouth mouth ‘recommender’ model so we have to be on the ball.

But if you are a large company that has been around for a while how do you deal with it? I can understand this stuff is hard for larger organisations with a large customer base. They will likely have some dissatisfied users who have the potential to be very noisy.

I suggest being honest and put processes in place to gather the feedback so you can report on it.  I think customers do understand it can take a while to turn the ship around. If you provide a way for customers to engage and have the dialog they may understand and can at least take some satisfaction from venting.

I also suggest diverting some of your customer care staff into monitoring your twitter and blog exposure.

The simple tools to at least monitor what’s been said are:

• Twitter Search: http://twitter.com/#search?q=yourcompany
• Google Alerts: http://www.google.com/alerts

Any other tips for managing social media? Do you agree Boards should be thinking about Twitter?

As the Internet and Web 2.0 has taken off we’ve been able to break out and  do things globally. That’s what makes the Internet so cool – success can come from anywhere in the globe.

In the same week our Prime Minister appears on Letterman, our own Dave5 from Ponoko nails the cover of the year …

Dave, we’re all so proud!

I was invited to speak and I talked about how important this blog has been to the success of Xero. I shared some insights on why that is, how we manage the process of writing it as a team and other ways we’ve been using WordPress.

I just happened to come across these “10 harsh truths about corporate blogging” and they are definitely closely aligned to our experience and advice.

My slides are below and Idealog has a pretty good summary of the preso.

The six tips are:

• Know why you’re in business

• A bird in the hand

• Tell people what you do

• Spend every dollar like it’s your last

• Be financially well organised

• Get help

People asked us where they might get a copy of the presentation so we thought we’d share it with you.

At the Web 2.0 Expo I picked up some really valuable tips that I wanted to share.

Stephan Spencer did a great session on SEO. Here are some of the key takeaways I got from it:

• Anchor text (the text of inbound links) is one of the greatest determining factors in setting page rank for your keywords (we want to rank high for online accounting so please link to Xero with that anchor text!!!)
• Avoid duplicate content on your blog (main page, post, category page) because it dilutes page rank, instead use excerpts to increase keyword traffic and concentrate Google juice to your permalink blog post page. Spencer has a detailed write up on SEO for blogs.
• Conserve Google juice for high value pages by using nofollow on low value pages (ie, privacy page, terms of service page). I’ve dug into this a bit deeper and there’s some controversy over this advice.
• Google serves different results for different locations, not just countries, but down to the city level
• Track and fine tune unique and precise meta descriptions and page titles to boost keyword ranking
• Measure and fine tune visit-to-signup conversion rates on a daily basis for high value pages
• Short URLs result in higher click thrus from search results. The theory is that people innately trust that the source is more precise.

Here are slides from a few other awesome sessions that provided great insights and advice:

• Eric Ries’ session on building and running lean startups (slides with audio)
• Awesome panel on customer metrics strategies for activation/acquisition/retention

This is just too good not to share …

That may be my favourite YouTube clip of all time. Thanks spareroom.

I often tell this story during events, but may as well tell the world.

Firstly we really wanted a great name. If we are going to be a global player we wanted a name that stood next to SAP, IBM etc.  But it is really tough because you have to have a great web address as well.

We thought it would be impossible to get a great 3 letter domain name, but were really keen on 4 letters. It had to be a ‘.com’. Some of the early names we looked was Accounting 2.0, Basecount, Pacioli (the inventor of double entry accounting), etc etc.  Not great names.

A friend of mine Dot Johnstone is great at finding names so we engaged her to help us out.  It’s unlikely you’ll be able to just get a great domain name.  Most are taken and parked so you have to negotiate for them.

Dot thought of Zero, but when we approached the domain holder the numbers they wanted were ridiculous.  She then thought of Xero. We just immediately liked it.

Xero.com was used by an designer in New York. We made contact, had a good discussion and negotiation and got the domain for a reasonable price for both parties. (Thank you!)

Later we found out that Xero was a comic book character, so my google alerts often come back with unusual results.

Doing some further research on the other Xero superhero turned up this …

Xero, about a superpowered government agent who was a black man who wore a mask to appear as a white man while working as Xero, was a short-lived comic series from DC in 1997. Christopher Priest (who owned the character) and ChrisCross were the creative team.

Hope that answers the question.

T-Suite is Telstra’s Software as a Service platform. Here Australia’s small businesses can save costs by leasing software instead of outright purchasing expensive systems. Other software vendors already part of T-Suite are: business productivity from Microsoft and on-demand security software by McAfee.

Xero fits in perfectly with the T-Suite as: it’s accessed purely over the internet, subscribers pay a small monthly fee instead of hefty purchase licenses, aims to improve cashflow for small businesses, and reduces IT demands by letting users focus on more important tasks while the software is updated automatically.

Form June 2009, Xero will be available to over 700 000 of Telstra’s small business customers.

Rod will be presenting on social media tools to create brand awareness and build niche communities. Rod will address how blogs, Twitter and other web technologies help make a significant difference to your brand and improve engagement with your customers.

When: 4pm, Thursday April 2nd
Where: War Memorial Hall, Marine Parade, Napier

Drinks & nibbles will follow the presentation.

If you would like to get along to this free event, then email Tank at admin@tanked.co.nz or call Natalie on (06) 835 6100.

In a Downturn, Provoke Your Customers

Underlying provocation-based selling is the idea that the vendor should help the customer find investment funds even when discretionary spending appears to have (at least temporarily) dried up.

I’m sure many sales people are already using this technique but I always enjoy reading analysis behind sales theories.

I don’t really like the word provocative, or provocation. It seems confrontational. I really think of this as active selling a specific benefit that is more relevant at a particular time.

But I find it really useful to be away of sales models and be able to flip between as the situations arise. Are you doing a product sell, solution sell, relationship sell or now a provocative sell.

In Xeroland our current provocation is Management Reporting. We believe that when the next round of loans come up for review Small Business Owners and Accountants will require up-to-date financials and regular ongoing monthly reporting. This is of course an opportunity.

In the technology world you can use upcoming technology trends as an accelerator. One that we’re hot on is Netbooks which we believe will fundamentally alter small business computing. It is cool that the mainstream media are beginning to wake up to this as well. ‘Big Three’ taking technology into the sky.

Where in the world will Google take us next?

The ambitious web search company joined the browser fray late last year with Chrome. It has an operating system, Android, that is running on some mobile phones and a “netbook” …

Next stop: the clouds. Cloud computing is the next new thing in the information technology world. …

Spending on cloud computing services is expected to treble in the next three years, reaching US$42 billion ($79 billion) a year by 2012, say analysts IDC.

The technology world presents many opportunities to use provocative selling methods.

A key quote in the Harvard article is around seeking a person with authority who can get a deal through.

To begin a provocation-based sale, you must do three things well: identify a problem that will resonate with a line executive in the target organization; develop a provocative point of view about that problem (one that links, naturally, to what your company has to offer); and lodge that provocation with a decision maker who can take the implied action.

Please feel free to share any other sales tips in the comments.

Campaign Monitor was chosen after a lengthy assessment by our direct communications manager Charlotte Hinton and the design team. They offered the most advanced and cost-effective product to enable us to communicate to our stakeholders and measure these comms in the best fashion.

Not only that, they are absolutely design -led just like Xero, and therefore seemed a natural fit. The guys have continually listened and responded to our questions and requests and are aways interested to hear what Xero is up to and what our needs are.

Campaign Monitor is an industry leader,  and count among their customers other leading international brands besides Xero, such as  Apple, Twitter, Yahoo, Facebook and Ning.

A few of our snazzy – looking communications are shown at the bottom of the case study. Many of you will receive our newsletters each month but for those of you that don’t you can send us an email and we will put you on the list.

You can read the full case study on Campaign Monitor’s website.

We quickly discovered that it is very, very, expensive for small companies to build brand.

Rather than throw money into brand building activities our strategy has been instead to invest in great people that have the horsepower to create marketing partnerships with significant organisations who are already communicating to our potential customers. We believe that Xero gives these partners  new and relevant messages to talk about.

We’ve been working on these relationships for some time, so these prime advertisements from Telecom are a clear deliverable of this strategy.

We believe this is good for the the wider industry in general. Telecom is demonstrating they understand some of the pains of small business owners, and that by partnering with innovative companies they can create a strong, joint, value proposition.

It also starts to signal that telecommunications is about more than the pipe. It’s about the applications that run over those networks.

Another broader trend we are seeing, is that in these tough times, big businesses need to work hard to provide value and service to small businesses. Small business as a sector is still ticking over. I think we’ll see a lot more innovation from carriers and banks as they focus on the small business market over the next few years.

We promised to our accounting partners that we would be providing more than software. We would provide business opportunities. As new customers come into Xero, they check out our partner directory and we know this creates new customers for our top partners. Everyone in the Xero ecosystem benefits.

Thank you Telecom for your support. It’s much appreciated.

There is no need to wait. We have launched a new campaign that allows you to prepare for 2010 now. And, billing won’t start until April, 2009.

So get a head start on your new financial year now and switch to Xero.

Having a sig shows that you’re professional and serious about doing business. It’s necessary for prospects, plus new and existing customers. By having a sig you’re making it easy for people to find your website, to call you, to IM you; in short, to do business with you.

Without it, you’re essentially putting up an obstacle. You’re making it hard for people to reach you at that moment when they need you. So people instinctively look for the next closest option, somebody else who cares enough to make things a little bit easier.

Do yourself a favor and make sure you have a sig with at least your web address and phone number(s). In some cases, it’s important to include your postal address and IM address. Some people even use the sig to promote their latest offering; if it’s low-key, that can be very effective and useful for your customers.

On a related note, here’s another great list of top ten business tips.