Internet marketing Archives - Page 10 of 47 by Mark Murnahan

Social Media ROI, Marketing Cost, and the Willingly Confused

Social Media Sends Mixed Signals

Many people have a very confused view of social media, and I can understand why. If you just look at all the ways social media is used, there should be little wonder how people confuse the issues. Some of the most bewildering concerns I notice surrounding social media are the return on investment (ROI) and the cost of social media marketing.

Millions of the world’s businesses understand by now that an investment in social media is vital to their success. Tragically, many of the same businesses are generally clueless about how and why they spend money with social media, and how to optimize their spending for the best results.

These same confused companies are further complicated by misguided notions that social media is limited to, or primarily intended only for personal socializing. They are the companies who question why a business would use Twitter, because that is where people announce what they had for lunch, LinkedIn is just for job-hunters, and Facebook is where old high school friends swap stories. That is social networking, and networking is important, but it is only one facet of social media. If you confuse this, and think that social networking is the basis for social media marketing, you will waste a huge amount of energy trying to sell to your friends, and others who already know you.

Believing that social media is just for personal socializing is a costly absurdity. It is the kind of absurdity that some companies will only discover after competitors have stolen away enough market share to demand attention.

Because of a lot of confusion, some people will say that the return on investment (ROI) of social media marketing is difficult or impossible to accurately calculate. I don’t think that is the case at all. If you have the right variables, calculating the ROI of social media becomes just another mathematical equation. The trouble is that so many people neglect or overlook the measurable data that really counts.

Social Media ROI Causes for Confusion

A first step to calculating the ROI of a social media campaign is to have a clearly defined campaign. That means having a strategy in place, and not just a list of tactics. It means producing a plan with a set of measurable outcomes. It requires creating and collecting customer modeling data, and using that data to reach your target audience.

Read the Social Media Signals

I have read and participated in a lot of conflicting discussions and possible answers about social media ROI, and most of it is very inaccurate or misleading. Many people will intentionally leave it open for a lot of confusion. After all, if people are confused, it is a lot easier to charge them money for things that are of little or no benefit. Calculating the ROI of social media is actually very basic, but that’s not what the failed real estate agent turned instant marketer wants you to believe. If they can convince you to just wait a little longer to see measurable results, they get paid more. Because of ignorance and greed, the debate of return on investment may never end.

In order to try and bring a little more clarity, let’s address two huge variables.

Social Media Branding vs. Increased Sales

Two very popular considerations for growing a business using social media are branding and increased sales. The two should work well together, but let’s face it, a brand can be really popular and still have a bigger drain hole than spigot. Even the most brilliant branding does not always make the sales hose filling your bucket as fast and powerful as the money drain leaving your bucket. There has to be a balance in order for the efforts to be sustainable and valuable to the company.

I find it very common for companies to lean too far in one direction or the other in their goals and attempts for successfully reaching their market. Confusing the value and cost of branding with the value and cost of increased sales is often when measuring social media ROI becomes completely muddled. Producing a balanced strategy is simply not as intuitive as most companies expect.

Building your brand name is extremely important. It builds recognition, trust, and sets your tone among the many other competing brands. It does not always have a proportionate result in sales. If you doubt it, look at it like this: You have probably encountered many great brands via social media, while it still didn’t bring you closer to buying from them.

In many instances, building your brand recognition will seem like it takes on a life of its own. When it gets to a certain point, it will grow and change, even without your input. People will talk about you more, and they will pass along your virtues by way of social media. They share your brand on Facebook, tweet about your brand, and they will become an influence to your brand (if you are paying attention).

Now, what about building those social-media-induced sales? All of the touchy-feely great branding and kind words about you can still lack a good reason to buy from you. There are a lot of companies I really like, but I am simply not their target audience. When I know somebody who can benefit from those brands, I pass them along. The brand reaches their target through me, and others like me, who become their connectors to their ideal target audience.

This is a fantastic outcome, but let’s face it, it is not always as efficient or as easy to come by as you may wish. It takes a lot of effort, and a lot of brilliance to produce a sustainable and self-propagating level of branding. It is a highly effective strategy for long-term growth, but it is also a very ambitious and frightening marketing endeavor in the beginning. Thus, a need for a balance between short-term and long-term marketing strategy.

Social Media Marketing is Branding, Advertising, and Much More!

I believe that some of the worst points of confusion in social media marketing come back to what marketing is, or is not. Both branding (long-term) and advertising (short-term and long-term) are extremely valuable when they are done well, but they require very different measurements to accurately calculate their respective ROI.

Which Way is the Right Way?

Companies often skip steps in their marketing, and then wonder why it is not measurable. This is especially common in smaller companies, because it is nobody’s full-time job to understand, monitor, and measure the company’s successes in this area. Instead, a lot of companies will try and “wing it” by assigning marketing tasks as an add-on to other job descriptions.

This is most profound as it applies to social media, but often because the people actually writing the checks have never had somebody explain the value and potential of social media from a marketing perspective. So they often just pin a badge of “Marketing Expert” on an unsuspecting employee who seems to have some aptitude (has a Facebook account).

When you decide how to set your prices for something, it is marketing. When you perform a market feasibility study, it is marketing. When you accumulate customer modeling data and use that information to better understand what people want and need from your company, it is marketing. When you set up a new Facebook or Twitter account and cross your fingers and hope for amazing business results, that is not marketing. That is dreaming. Dreaming is not measurable, and only seldom is it profitable.

Aside From Being Social, Why Should People Buy From You?

Without an expressed reason for people to become your customer, efforts will generally fall into the category of branding. This includes when they are right there on your blog, where you want them to be. As an example, I use my blogs and social networks for reaching out to be helpful, and that emphasizes my branding. When I say “I take coffee and cigarettes and turn them into better SEO and social media marketing.” … that is my brand. All of that helpfulness and broad recognition in my industry is great. It leads to many opportunities, but it is not what actually makes the sale.

On the other hand, when I say “Call me to find out how I can help you to grow your business with a measurable return on investment” … that is advertising, and that is also marketing, but it is not branding. It is how I earn a living, and it is what improves my social media ROI. The branding is just what makes more people comfortable to call, and confident when they write me the check.

As you can imagine, when it comes to spreading a word far and wide, branding statements and being useful to others will often reach further and faster. This is because they are generally non-threatening to anybody. While, although this information is good food for thought and useful to many, I have already diminished much of its social media reach by making an advertorial statement (above).

Regardless how useful what I wrote here is, many people will be far less likely to share it with others. Part of that is due to cynicism, and part of it is due to competition. It takes a lot of branding to make up for and repair cynicism and people’s disinterest and distrust toward advertorials, even within a useful context. This is why I say that a balance is very important.

If you do not understand and differentiate the value measurements of branding and the value measurements of other areas of your marketing, calculating your return on investment will always be a bit cloudy and confusing.

Am I wrong? Go ahead and tell me why and we will hash it out until one of us agrees. 😉

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Photo Credits:
Confused Traffic Signal by caesararum via Flickr
Confusing Signals by Luis Argerich via Flickr
Confusing Signage by Tara Hunt via Flickr

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Social Media Compared to Kids on a Field Trip

I recently attended a school field trip with my second grade son, and I heard social media on the school bus. As the kids boarded the bus, the sound of 40 kids filled the air. The driver gave them some “noisy time” before we hit the road, and they took full advantage of it.

Each kid had something to say, and when they felt they were not being heard, they each became louder. It really was a lot like social media in this respect. Nobody was being heard any clearer at a higher volume than when they were quiet, and the distractions made communication even less effective.

Once we were on the road, the kids screamed with excitement with each bump in the street. It was social media’s equivalent of Apple launching a new iPhone that could make an endless supply of bacon magically materialize.

The parallels between the sound of kids and social media were numerous, but one that stood out was the kid who quietly raised his hand and asked for a teacher’s attention. He was the first to get the attention.

A few of the other kids learned that simply leaning close and speaking quietly was the best way to reach their intended audience. Then, if it was something really important or interesting, the message would spread across the bus, from one row of seats to the next. It actually worked as easy as that, and it formed a great picture of how social media works.

When everybody is making noise, sometimes all it takes is a well-placed whisper to make a greater impact than screaming into the masses.

The field trip was to a farm expo, where the kids learned about where their food comes from, and the many important tasks of farming. There were hundreds of kids attending from schools all across town. It was the responsibility of the volunteers and teachers to help them enjoy the trip, learn, and then deliver each of them back to the correct school.

Kids are very social creatures, and they love to mingle. Keeping our school’s group where they belonged, and holding their attention on the course was a bit like herding cats. The best way to reach them was often just as we had seen on the bus. Simply tapping them on the shoulder, giving them a bit of friendly instruction, and encouraging others to follow their example worked exceptionally well.

The Field Trip Was Fun and Educational for All

By the time we returned to the school and disembarked, I realized that even as they grow up, some of them will understand the value of a well-placed whisper, and others will just keep trying to scream across the bus.

Some of the kids joined in with existing conversations, and added to them productively. They were given opportunities to communicate and share their perspectives. Sometimes the conversation even went right where they wanted it to.

Other kids screamed to create their own conversations, but a frequent outcome was that they only added to the noise. They were not talking about things the other kids wanted, and they were a distraction to the others as they tried to force their topic.

I hope you can see the similarities, and that you will be encouraged by the lessons of these second graders. For me, it emphasized that one is never too old to learn, nor too young to teach.

What do you think? Do you see how we can all learn from a second grader?

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Social Media Marketing Pricing Like Cab Rides by the Pothole

I find that a lot of people are curious about breaking down marketing services like social media and search engine optimization to an hourly rate. I know this, because a lot of people search the Internet for pricing information and find me.

Silly me, I don’t have a standard rate sheet, but I will tell you why. I don’t know how much it will cost to perform SEO or social media marketing until I know what a company wants and needs from the services.

I understand the concern of marketing cost. After all, the reason for a company to spend money on marketing is to achieve a higher profit. This means the cost of marketing will be a factor. However, it is too common that the only set of numbers a client will clearly understand is the outgoing money, while they ignore the more important numbers such as accurate projections, goals, and increased profit.

The cost of marketing is not the same for any two projects, because the associated tasks are as different as the company itself. More importantly, marketing is something which spans the life of a company, and not just a set of tasks that are finished in a set number of hours. If you shop for marketing by seeking to buy a set of tasks, then you are essentially dictating a job, rather than letting the professional do the work they are trained to perform.

Reasons Marketing Cost Varies, and Menu Pricing Fails

Menu style pricing works great for some marketers, but it can create a huge disaster for the client. I don’t have time to list all the reasons the cost of marketing can vary widely, and you don’t have the time to read that list. I’ll give you a few points to consider.

Some companies will have well-formed projections of their market potential, and some will have already done the research to know how many people they must reach to achieve their goals. Some will have a targeted marketing strategy already prepared, and most will need help improving it. Some will have already performed A/B testing to determine their optimal conversion rate. Some will have creative ideas for their marketing, and even have talented people to help implement it.

Some companies have all of these things in place, but this is often not the case. Instead, I find that they come to me asking me to do whatever it is I do, without really even knowing what needs to be done. Then, without understanding the tasks, or reasons for them, they want a shortcut answer to “How much does it cost?“

The question of how much it will cost, without a clear idea of what is needed, or what will actually improve your return on investment is an easy way to waste money and time doing the wrong things. It is like shopping for a dentist by seeking the cheapest price for a filling while what you really need is a root canal. Worse yet, it is like telling the dentist how to perform the filling, and asking for a discount because you used less Novocaine. With that kind of thinking, should there really be any wonder why most marketing fails?

Dictating Social Media Tasks is Like Telling Your Cab Driver to Swerve for Giraffes

Would You Buy a Cab Ride Priced by the Pothole?

It makes me wonder how many companies pay their building lease by the hour. What if they booked flights by the mile? Would you pay extra to fly around a storm? Would you tell the pilot which way to fly, or would you rely on the professional?

Some things just don’t sensibly calculate in the terms we think they should, or wish they would. It is not always because somebody is trying to hide an obscene profit. Many times, it is because the cost would be outrageously high to account for each item granularly. Imagine trying to account for a cab ride that includes a charge for every time the cab hits a pothole and gets a little closer to needing a new set of tires or shocks. Should stopping for traffic signals cost more to account for the brake wear, or should we burn more gas and take the longer route to avoid them?

The challenge for a lot of people to realize is that the cost of any product or service will be built into the price. The cab driver will need to receive more money for his job than what it cost him, so he sets his pricing and maintains his car to optimize his earnings. If you asked him to itemize each thing, you would have to pay him for that extra time he is doing accounting instead of driving his cab. If your driver lets you blindfold him and direct him how to drive, you are both foolish.

My point here is to express how easy it is to make mistakes when shopping for and comparing services in an unfamiliar industry. In the industry of online marketing, if you pay for somebody to account for every hour, you will likely pay a lot more for the extra accounting.

Then again, I guess I shouldn’t complain if somebody wants to pay me for the hours I lie in bed at night staring at the ceiling as I ponder how I can make them more successful tomorrow than yesterday.

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Photo Credits:
Costa Rican Pot Hole! by Arturo Sotillo via Flickr
Cone & Pot hole by oknidius via Flickr

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Hourly Rate for Setting Up Social Media Profiles?!

My blog is often inspired by things that happen in my real life. It is easier to tell something from experience than to make things up. Sometimes those things which happen in real life make me want to scream! I am going to share a good example.

I received a call from a friend yesterday. My friend was seeking some advice about social media, so I was delighted to provide my assistance. The question created one of those moments when I want to scream, pull my hair out, and choke people. My friend wanted to know how to set an hourly price to set up social media profiles for companies.

The question was important to her, because an advertising agency she works with had come to her asking for an hourly rate to help set up client’s accounts on Facebook, Twitter, and etcetera. She was caught off guard by their request, and so she asked me for an opinion of what it is worth.

My friend is a relatively popular blogger, and avid user of social media, but she is not really in the business of social media marketing. Strangely enough, they thought she could help. Since she does not want to turn away business, I feel for her dilemma. In this case, I suggested that providing a service that creates a zero net gain, or even a loss to the client is a good reason to either further educate the client, if they are open to learning, or to walk away from the offer.

I suggested that an hourly rate for setting up social media profiles, as with any other marketing or public relations service, should have a basis in the value to the client. In this case, the value would be minuscule, if not negative, and I explained some reasons this is the case. Of course, it began with the logic that any company who needs somebody just to set up their profiles is not likely to use those profiles for any significant benefit.

Creating social media profiles has extremely low value without a strategy, and without the manpower and mindpower to use them well. If they had that manpower, and more importantly, the mindpower, they wouldn’t need my friend at all. It all got me to thinking that it is like a dog chasing a train. What will the dog do if he catches it? The dog doesn’t know, and so the dog will not get much benefit from the chase.

I want to tell you a couple reasons this is a formula for failure.

Social Media Profiles Do Not Provide Value!

I understand that this may not make perfect sense to everybody, but I am going to try to make this easy. Sure, there are a lot of people who do not know how to get their name on Facebook, or how to create a Twitter username. My mother would not have a Facebook account if I had not set it up for her. My mother is not running a business and trying to promote her name, either.

Think for a moment … If my mother was in business, would it make sense to have somebody set up her account just so she could say “I’m on Facebook and Twitter”? What good is that? Is it so that people who already know who she is could magically flood her with new business? Why would they do that? Let me tell you the truth about this … They won’t!

The value of social media comes when you actually give people a reason to chose your company over the squillion other options out there in the marketplace. If you don’t have a clear reason for people to choose you over a competitor, or to recommend you to their friends because your company is awesome, what is the point? Is it the visibility that is so enticing? I want to assure you that there are millions of visible people who are failing in business. Having a social media profile is not going to make you more successful, and is very unlikely, in itself, to make you more visible.

A lot of people obviously do not yet understand that social media profiles are not going to spew crude oil or reveal a hidden gold mine. Perhaps everybody around you says “You have to be on Facebook” or “There are people making tons of money on Twitter.” The thing they don’t tell you, and probably do not realize, is that social media is not like a Hollywood “Field of Dreams” method for easy success.

This mentality is something I really try hard to understand, and I even try to be compassionate and patient about. The challenge is that when I explain it to people with solid proof, but they still have to learn things the hard way, I end up feeling bad for not having the strength to help them. That is crazy, right? I should not feel guilty for other people’s unwillingness to believe the truth, but I still do.

What About the SEO Value of Social Media Profiles

A lot of people seem to be convinced that there will be a big SEO (search engine optimization) benefit by having a lot of social media profiles. Social media can have an amazing impact on search engine rankings, but it is not why some people think, or hope, or would ask you to believe. The benefit comes when social media is used well, and more of the right people learn about your offerings and share it across their networks and link to your website from other places, such as their blogs and websites.

I understand how the false notion can seem almost logical, because each of those social media profiles will have a link to their website, and more links are a good thing.

There really is a lot of SEO value in social media, but it takes more than just setting up unused profiles. Otherwise we would all be in a race to have the most social media accounts. Some people are, but not the wise ones … not the informed ones. If you ever actually thought that the SEO comes from unused and unknown profiles, think again! Of course, most of the people seeking to pay for such a service would never take the time to read and learn about this, but for your amusement, I offer you some articles on the matter as follows:

100 Social Media Profiles or 1,000 … How Much Do You Want to Waste?

There is a constant pipeline filled with desperate companies hoping and begging for a quick and easy fix to increasing their business’ profit. However, with each company that sets up their social media profiles and endures the failure of short-sighted thinking, comes dozens of their friends and colleagues who will learn from their failure. This means that the pipeline will eventually slow down, and people will have to start thinking before they earn.

When Marketers Sell Negative Value, They Destroy Their Own Market

There is a rule in marketing that a lot of people try to overlook, but it is to their eventual regret. Regardless of the client’s request, it is the duty of a marketing professional to be sure that the client receives more value from the relationship than its cost. This goes for advertising agencies, independent marketing consultants, and in-house marketing departments.

The rule works like this: If the client / company receives less value, in the way of increased business, than the cost of the marketing efforts, it is not sustainable! Trying to work around this rule is like rubbing a lamp and hoping that a money genie will somehow magically come and make up for the screwups.

I realize that the conventional thinking is to give the client what they ask for, and to take their money. I see that as a huge mistake, and proof of a marketer who does not adhere to the same standards they expect of their clients. Good marketing consultants help clients to maintain their marketability and to avoid taking hazardous shortcuts. If the consultant just takes the money and gives a client what they ask for without questioning it, they are not doing their job.

As long as people are set on believing the myths of social media rather than the truth, they may as well say a toast to their own failure.

My Answer to This Question

My answer, if somebody asked me how much it would cost to set up their social media profiles would be something like this:

It will cost a bare minimum of $5,000 per month, and quite easily over $25,000. It will come with a whole lot of market research, strategy, implementation, and a well-forecasted return on investment. That means it will pay you a lot more than you pay me, but that is only if I believe in your company enough to hang my reputation on it. That does not happen with companies who are resigned to believing that simply “being on social media” will increase their profit. Thank you, but no thank you.

If you run your business by placing cost above value, you are making a big mistake. Instead of pouting about how much a successful marketing campaign will cost, it is better to focus on how much it pays. Then the more important factor is how to get your hands on the money it will take to achieve the results you are after.

Related Articles:
Yes, I put these here for you to read. I think they can help to emphasize why simply setting up social media profiles without a good strategy is a waste of time and money. You already have an idea whether you can afford me or not, so don’t worry … I am not selling you anything, and my prices will not go down just because you read more of my blog. Enjoy!

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In Marketing, It Will Fly or It Won’t: What Grounds Your Marketing?

Persistence is important in marketing. If you give up too soon, you could miss a huge opportunity. On the other side of the equation, if you are trying to fly a lead balloon, it is best to stop before wasting any more time and money.

I want to inspire you with some questions about your marketing, and your business challenges. You don’t have to answer, but I hope you will. So, let’s start thinking about some things that can ground your marketing.

Know When to Change Course

How do you define the point when it is no longer productive to keep doing what you are doing? If you don’t know when to implement changes, it can destroy your company. What is the right answer? Is it when the competition starts taking away market share? Is it when the budget runs out? Is it when the company goes completely broke? Is it before all of this begins to go wrong, and you can take a proactive approach? Let’s consider this quandary, because although it may not be comfortable, knowing when to make changes is imperative to the growth of a company.

Have you ever pulled the plug on a marketing campaign? I have, and sometimes it was too late, but other times it was too early. I lived, and I learned. It sometimes felt like I was one of The Wright Brothers, crashing airplane after airplane trying to get it right. If you have ever really tried to make a business fly, you have probably felt the same way. Sure, there is value in mistakes, but there is even more value in learning to avoid them!

Look at the efforts in this early flight video, and tell me if it feels a bit familiar to you.

Marketing really doesn’t need to be so painful. The information you need to know is right there at your fingertips. Yes, right there at the computer you are gazing into, but it will only help if you learn how to use it. Even then, it does no good if you don’t actually make the tough decision of putting it into action.

If Your Marketing Won’t Fly, You Need to Know Why

How do you avoid the failures and cut straight to the part when your marketing soars like an eagle? That is tricky, and it is as unique as the company itself. You cannot eliminate all mistakes, but you can come a lot closer, don’t you think? I think we all can.

Something that many companies hesitate to embrace is that a marketing campaign should be carefully researched, or it should not be launched at all. When companies neglect the value of market research and planning, it is usually because they have already reached a point of desperation. This is often geared to cut corners, but it is about the worst place to make cuts. Another reason I see companies skip market research and planning is because they simply fail to realize how much they don’t know about growing a business. They may know their business, but know little about how to make the business grow.

Shortsighted marketing is especially common as social media marketing has become a perceived savior of the business world. This can all be used to your advantage, but not if you are doing the same things, and making the same marketing mistakes the competitors are.

Social Media Made Marketing Easy … Mistakes and All!

During my 20 plus years in marketing, I have made a lot of observations. What I have seen in recent years is a far greater tendency for under-funded and poorly planned companies to try and emulate competitors, rather than stand on their own unique merits. I call it imitation marketing, and imitation marketing means imitating failures, too. It does not fly well.

Along with the social media marketing craze where everybody wants to become a marketing professional, a lot of talent has been discovered. Far more often, it has led to massive amounts of waste created by squillions of people trying to earn as they learn, instead of earning based on their experience, knowledge, and marketing talent. I’m not exaggerating when I say that social media has as many downsides as it does upsides, and this is a huge downside!

Projections became more like a drunken bar room shootout for a lot of companies, and based less on solid mathematics and science, and more on luck. This makes absolutely no sense to me, because there is no other form of marketing that is more measurable than that which is performed with a computer. Computers record data and organize it very nicely, but some people still question the measurement, or the ability to hit the target. That sounds completely absurd to me, but then again, I have worked with it every day, since the 1990’s.

A Crash at the Air Show

Wouldn't Orville Wright's Diary Help You Fly?

I often watch unprepared marketing departments and small business owners running off customers by crashing their plane at the air show. They finally get an audience, and they make a bad maneuver. Worse yet is when they strafe the audience.

Firing into the crowd and hoping something hits the target is popular, but it yields a low return on investment (ROI). In military or police terms, it is a “spray and pray” effort. If you spray enough bullets, and pray to the warrior gods, you may get through the battle alive.

Failure to implement a proper marketing strategy is often why small businesses remain small. I don’t think it is because they don’t want to do more business, but rather because they are overwhelmed.

There is much more to running any business than just the marketing. A challenge exists in realizing that good marketing is what makes a company successful. Marketing is what makes the difference between Coca Cola and other drinks that didn’t make it. It is a pretty terrible area to make mistakes, or take shortcuts.

There are many potential points of failure in any organization, but making your company more marketable, and actually marketing it well, can make the difference between huge success and utter failure. It makes the difference in whether it will fly, or it will not.

What Challenges Your Marketing Flight?

I want to know what you think. What are your biggest challenges, or the challenges you see other companies facing? What do you think companies are missing in their marketing? Is it ineffective market research, lack of marketing creativity, failure to budget, fear of loss, or the monster of all monsters … complacence?

You name it … I want your opinions, and I hope your insight may help others.

Let’s do some learning together. I would not ask you these questions if I didn’t want to learn, too. If you struggle with an answer, here is another way to look at it: What obstacles do you think hold a company back from hiring an experienced flight engineer like myself? Please share your insight.

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