Content Optimization: The Red Dress Story

content marketing A/B testing

In his seminal investing book, How to Make Money in Stocksauthor, money manager and founder of Investor’s Business Daily, William O’Neil, describes a situation faced by anyone who offers a product or service to the public, including publishers and stock traders, that he calls The Red Dress Story, It goes something like this:

A shopkeeper buys 50 red dresses and 50 yellow ones. One week later she is sold out of the red dresses and has sold only one of the yellow ones. How does a wise shopkeeper use this information to her advantage? She buys 100 red dresses for the next shipment, possibly increases their price and cuts the price of the yellow dresses. Buying more yellow dresses just doesn’t make sense.

Interestingly, though it might seem counter-intuitive, O’Neil recommends a similar approach when buying stocks. He recommends buying more of stocks that move in an investor’s favor, within certain limits, and selling stocks that move against them – in particular never letting any stock fall more than 8 percent below its purchase price.

So How Does This Relate to Internet Content?

Content creators can use this technique to gauge what their audience is really interested in – and tailor content specifically designed to appeal to it.

For example, if a content creator publishes a given number of pieces of content in a week, each focused on different keywords, and then examines which pieces received the most views, engagement, etc., they are receiving the most accurate, and up-to-date, information possible about what their audience is looking for.

Drop non-productive keywords, focus new content on popular keywords and test new keywords in a methodical way.

Obviously, some content may never appeal to a broad audience, but still has its place on the Internet – even then, content creators can test and optimize different versions of the same content using the red dress technique.

The most important takeaway from the story for content publishers is that they provide a valuable service to their audience. Regularly observing what content appeals to a given website’s audience not only increases traffic, but better serves it’s needs.

In fact, the more visitors a website gets, the more effectively it is serving its audience. Don’t tell customers what they want. Observe what content they engage in with their time and traffic. Build on popular keywords: constantly re-evaluate and optimize.

Changes in keywords trends is one thing that is certain.


Article by

Llewellyn Richards is an experienced financial writer with many published articles on topics ranging from technical analysis to due diligence. He is a graduate of the Canadian Securities Course and Conduct Practices Handbook Course. Richards is passionate about writing, as well as upholding the integrity of capital markets.

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