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Saturday, June 21, 2008

"Dumb Ladies" to Blame for Ruining Canadian E-Commerce: Goodman

Whereas British-Columbia-based search marketer Gord Hotchkiss of Enquiro has recently blamed C-level execs executing perverted yoga positions for the current anemic state of online commerce sites in Canada, Andrew Goodman, author of this post and founder of Toronto-based Page Zero Media, has recently concluded that in fact "dumb ladies" are to blame for the digital malaise.

"Chicken and egg, tail wagging dog, or a playing card with a picture of a row of houses on the back, slowly falling from the top of the CN Tower; however you want to describe the situation, I assure you that Canadian CEO's aren't to blame for it," argued Goodman in a barely intelligible interview earlier this morning.

Goodman's account of the situation suggests that weak demand for "sweet spot" online items, such as drugstore-based supplies, comes from "dumb ladies" who refuse to learn how to use a computer. A full transcript of his story follows.

"Today I was walking in Bloor West Village and turned into a nutritional supplements wellness organic niceties store, because the door was open. I attempted to buy a small bottle of green tea capsules, and was told that before tax, the item would cost $45.00. I didn't hesitate to tell the shifty-eyed shop owner that I'm sorry but that is way too much, and I guess I'm used to buying this kind of stuff from a warehouse in Arizona. I don't like to buy from the Arizona place anymore because of the surprise shipping, duty, brokerage, and/or tax charges that so often sting us when we buy cross-border. So as my mind drifted to SNDCanada.com, a reputable, fast, Oakville-based retailer, the owner's faint plea penetrated just enough: 'Well these are high-potency.' I replied somewhat rudely: 'That is, if I believe the claim.' Truth is, I believe label claims somewhat in a major drugstore chain from major brand names, and I actually believe them from certain online outlets. But in a brick-and-mortar store in a 'hood full of gullible subjects I really don't think I'm getting my $45 worth.

"You see, in my neighbourhood there are a lot of underemployed, middle class (not rich, that market isn't big enough) women who concern themselves with personal grooming to the point of making it into a profession. They are, unfortunately, almost universally dumb. Rising asset values in their homes have allowed them to make overinflated purchases in local shops, and because they aren't genuine consumers like the rest of us, they don't question label claims. And unfortunately, they refuse to use computers. As anyone in business knows, dumb ladies are probably the highest-margin demographic short of New York State Governors. Sicko shop owners take advantage of the situation, making hyper-profits, and the owners of e-commerce properties don't make any money."

"I decided to take a stand today. I walked out of the store. I was about to try SNDCanada.com, but instead remembered my new friend Ali - owner of Well.ca, a recent startup in the drugstore supplies space. My assessment of the price and convenience benefit of using Well.ca is definitely mixed at this point. A bottle of the higher-potency green tea caps from reputable supplement maker Holista runs $19.59 plus $3.00 shipping. (The "Add $79.41 more to your cart to qualify for free shipping" message does not act as an enticement.) And I'll always be in Shoppers Drug Mart in any given week so the convenience element is nearly nonexistent. In fact, it's a pain to buy online what with the forms & card info and all - and then the box comes to your front door when you're not home. What I'm really looking for, to justify the online effort, is a great deal on high-potency green tea capsules in a 1,000 or 2,000 count tub.

"Whatever I do, though, honestly, for spite alone I would never buy the small bottle from the shifty shop owner for $45.00. I mean what's next, buying protein powder at GNC in the mall? The only thing worse than dumb ladies? Dumb teenagers. They keep half the stores in the mall in business, and also refuse to learn how to use a computer."

Postscript: the water meter reader who just came by is a smart woman. She uses a computer while walking house to house! I wonder if that device could be used to zap some sense into those Canadian CEO's or dumb ladies, whichever came first.

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Posted by Andrew Goodman




Sunday, June 01, 2008

The Brand of Canada: In Progress

Thinking things over, I've come to the conclusion that Canada has comparative advantage in a few areas (not quite as many as she might think):

  • Smugness
  • Gay Marriage
  • Blackberry
  • Universal Health Care (only compared to US)
  • Diamond mining not in a war zone
  • Oil sands
  • French people not from France
We also have some fascinating thinkers and poets nonpareil: Marshall McLuhan, Têtes à Claques, Leonard Cohen, and Funnyman Bobby Bittman.

While seemingly innocuous and occasionally bumbling, Canada doesn't have any national diseases (SARS was overblown) needing Sarkozy-strength fixing. Our currency is strong. We are poised, if not to take over the world, then to be more competent in 2008 than we were in 2007.

So folks, go out there and win one this week! Or at least -- like Mike Weir in the Memorial -- come tied for second in something! When in doubt, hire Americans named A.J. and B.J. and pay them a great deal of money to lose for you!

Any fellow Canucks care to build on this list/legacy: the comment field is open. Canada Day is only one (1) month away. We need you.

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Posted by Andrew Goodman




Sunday, May 11, 2008

CMA National Convention, Monday May 12

Hi all,

I'll be speaking at the Canadian Marketing Association's annual National Convention and Trade Show Monday afternoon (today by the time you read this) at the Metro Toronto Convention Centre. As usual my subject will be Mastering Paid Search - but also as usual, I'll disregard most of the bullet points I sent in months prior to the event, and instead will focus on the most cutting-edge info in the space (while being unable to resist a few digs at the slow Canadian adoption of cheap dirt cheap did I say super cheap get 'em while they're hot, paid search clicks).

This year's show looks like a winner. I'm looking forward to taking in Avinash Kaushik's keynote, and meeting Penelope Trunk, among other things.

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Posted by Andrew Goodman




Monday, April 07, 2008

Canadian Babelfish Wanted?

Today I got into some conversations about just how Canadian Toronto is (or Canada, for that matter). It made me recall a chat I had with Jeffrey Eisenberg a couple of weeks ago, wandering up Spadina (rhymes with "diner" not "Gina") Ave.; in his opinion this is the most American of Canadian cities.

Be that as it may, I got a note from a Boston-based friend asking for a translation of this:

I need a Canadian interpreter for the following sentence: "We recently bought a large semi in Little Italy." What is a "semi" in this context?

So I was not aware that "semi" to represent "semi-detached residence, specifically half of a duplex" was not commonly known to be the same as "duplex" (or the half of a duplex you own). Semi=duplex (one side). Duplex here = duplex (both sides).

It went on to say that he made his semi into "three units," meaning three rentable apartments, no doubt possible because it was a large semi.

Little Italy is the trendy area around College and Clinton in Toronto, with bars, cafes, and apparently, large semis that are sometimes income properties, but for the fortunate, single-owner dwellings.

And to round out the translation session: the "pot lights" the gentleman was installing have nothing to do with more liberal laws in Canada.

My friend is originally from Ohio, which may or may not explain anything.

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Posted by Andrew Goodman




Monday, January 28, 2008

Canadian E-Commerce Nightmare (cont'd)

On one hand, Canadian consumers should be grateful that canada.zappos.com is actually out there, showing the way it should be done to a largely underserved market and clueless sector... on the other, as this screen shot shows, when the default pricing is in USD on a site subdomained "canada...," maybe this could have been thought through a little better. The "US" is still in the upper nav, too. I mean, if this is Tuesday we must be in Cleveland, right?

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Posted by Andrew Goodman




Sunday, June 17, 2007

Canadian Search Marketing: Impending Hockey Stick?

Canadian Advertisers, Pull Thy Collective Head Out of Thy Collective Butt? That could have been the subtitle of some recent speeches and writings by Gord Hotchkiss, a well-known Canadian search marketing guru.

This week, in person and in writing, Gord was tearing into the Canadian business community for its poor record on adopting online advertising and especially search visibility tactics. This is juxtaposed with the Canadian people's world-leading Internet usage. This theme's been rolling now for a couple of years, statistically speaking, thanks to reports from companies like comScore, and now buttressed by survey research being disseminated by companies like Yahoo. In terms of quiet rants, it's been out there since 2001 or so, since some of us began seeing the post-bubble surge of quiet interest in search as the most cost-effective direct marketing and public relations tool going... by our US-based clients, who moved quickly on the opportunity and kept us all busy with work. (It didn't hurt that our dollar was very low, so we were low-cost providers who otherwise looked, quacked, and smelled like American consultants.)

Gord pinpoints the problem even more precisely - to Toronto, which holds most of the economic clout in the land, but seems slooow to adopt. Hey Gord, c'mon, I have to work here when I'm not hiding in New York or Glasgow! Easy for you to rant at my neighbors eh?

But this is not so new, Canada being above everybody else on per-capita this, and worse than a lot of countries on per capita that.

There are probably many more reasons beyond just a few businesspeople having their heads up their butts, than Gord and the commenters on his post let on. And even if that's the reason, it would be interesting to explore why that might be, then.


* Market size, chicken-egg, and what are they going to do with those clicks anyway? Larger companies with reasons to unlock big ecommerce budgets would have had less reason to do so until recently, because ecommerce itself had not come of age. Inventory and logistical issues were dealt with more slowly. No shopping engines were really available because the concept of a "comparison" was silly. The fear of online eroding offline margins was allowed to linger longer, because no competitors forced anyone's hand by racing online. Sweet complacency reigned, but this was at the higher level of ecommerce generally, not specifically with search. On ecommerce comparison engines, Google never launched Froogle Canada, for example. But due to not only doggedness but also market opportunity and some willing investors, Shop2It out of Calgary has persevered to build a real shopping engine for Canada (hammering out partnerships with AOL, MSN, Yahoo, and Canoe) -- that has required long effort to encourage adoption by etailers to upload their feeds, improve their stores, and actually try to sell to Canadians! An effort not even Google was up to.

* But why? There are definitely a host of cultural reasons, and reasons of business culture. Here are several sub-points in that regard.

First, small business is not championed or given the resources or encouragement it should have to pursue contemporary online growth. In Toronto the classic small business of a little independent brick and mortar shop is certainly a new Canadian's dream and the one hungry and busy middle-class Canadians are all too eager to applaud, but the other kind of small business, the one about getting a big idea and growing it, is seen as some sort of insane affliction. Family, friends, and neighbors will worry that you should just stop screwing around. Get a job with a big company Mom has heard of, like Bombardier, Nortel, or Microsoft. Doesn't matter if that job is stultifying, structurally set up to fail, etc. - so long as people have heard of it and you get invited to the company box twice a summer, you're part of the crowd. Good job. Luckily, people have now heard of Yahoo and Google, so there is a chance we'll see interest in actually nurturing tech and related startups here. (Next point covers these guys.)

Second, related to the first: big-company culture dominates, and Bay Street dominates. That's why the natural resource and financial sectors are *still* ruling our business pages. If the Street can figure out a way to finance it, then do it. Talk about it, work there, orbit around it. Otherwise, don't. That makes the Web 2.0 and any other high-productivity-oriented, high-achievement-oriented subculture just that: a subculture. The positive thing about that is that subcultures tend to be immune from peer pressure. The negative can be that unless their projects are financed, the world doesn't see the fruits. The other negative is that disgruntled subculture members become expatriates, in body or in spirit. Solution: our business *finance* and moral leaders need to nurture the subcultures, as JLA and Brightspark have done with b5media, and as the Mesh organizers have done organizing a conference around it. It all seems so under potential (b5 seems cool, but seems so alone out there; Mesh is great, but could be better) precisely because there needs to be just a whole lot more of this.

In other words, at a lot of levels there are a lot of great online entrepreneurs out there eager to be part of a community and eager to find markets. Their financiers and their neighbors down the block though could care less about their aspirations and right now are busy ignoring them as they prepare for cottage season. Because why don't you just make your ridiculously high salary in real estate or traditional advertising and shut up about innovation? "Zillow? What's that? Pass me a cold one." But it's only a matter of time before the cadre of Canadian entrepreneurs willing to build an online business, even through the delicious summer months, effects far-reaching change. Incentives and opportunity eventually produce results, but the state of financing is hindering the rate.

* Is Canadian talent being insourced to Silicon Valley? Google's office in Canada is just a sales office. One thing about weighing career and business ideas is that it has to seem like a real opportunity and a real lifestyle that other people have. In that regard, you can talk about them being "lower tier jobs" all you like, but the fact of a Google going into Michigan in a big way changes the parent-educator-neighb0r-youth dialogue. A lot of solid jobs equals a platform around which an economic and innovative ecosystem grows. Toronto is identified by Richard Florida as a creative cluster because of sheer scale, tolerance, concentration of educational institutions, and a host of other factors, but we shouldn't be content to rest on the luck and confluence of certain factors to drive growth in online business. Proactively encouraging even more of those things is a good idea. Dalton McGuinty, our provincial premier, is all over continuing our leadership in the auto sector. He's also promised transit expansion that's 15 years overdue, which will no doubt put a fat contract in Bombardier's lap. That's nice, but ... sigh, cars aren't where the puck is going. And in a metro area of 7 million, transit is just basic infrastructure. What else are we doing? Companies like Microsoft have a lot of employees here. Companies like Google strike me so far as uneven in their approach to how they foster and nurture their foreign offices. Isn't that called "insourcing"? Foreign offices can be just push centers that focus on replicating the adoption of the product back home, but those workers are classic account execs and support staff. At the end of their day, do they give much thought to engineers and high-tech startup culture? Silicon Valley is very good at luring those types of risk-takers and top thinkers away from their home countries. So what we can build around here is an important question. That's why companies like Research in Motion are so huge in the Canadian national imagination right now. The founders are literally national heroes. We need many more RIM's. And we'll need a counter-brain-drain and an insourcing revolution of our own. The reality is, you need a critical mass of people with good high-tech jobs to make that seem like the thing to do... and not to do somewhere else. Else, businesses will be run and migrated online without the benefit of new qualified blood. PROFIT Magazine and a few dozen people doing great stuff in government and education, in spite of incentives towards complacency, get it; most other potential influencers don't.

* Meanwhile, traditional advertising and Bubble 1.0 mentality web shops still cling to their perch and their perks in Canada. Large companies continue feeding them and their ranks aren't thinned by much, even though the word about measurable performance and user experience is starting to spread. Usability, business, and the online experience are really holistic phenomena that require stalwart "connectors" or "polyglots" who don't overspecialize but who have deep programming, design, and communications skills available in-house or in-brain too. Case in point, the startup I worked with settled on a web design firm out of Michigan that has Web 2.0 user interface and design savvy. They write real code and do real design; they don't force you into proprietary off-the-shelf boxes. The same job from a traditional web shop would have cost 5X as much. A local Toronto firm doing just the identity work, and none of the other work, quoted us double the price - and they are really good, far better than most in town, and so busy that they probably wouldn't have had much time for our job anyway, no matter what the budget. Demand for competent online professionals in Canada far exceeds supply. ... User experience as part of someone's job. Search savvy as part of someone's job. Basic background on online demographics and analytics as someones' job. This all has to happen. It's not happening very fast because of course you don't learn it in school (yet) and so you would need to go to a "good shop" to learn it, or learn it by osmosis through your particular subculture. I'm optimistic that we will reach the critical mass (in Toronto, Montreal, Vancouver, Ottawa, and Calgary, in particular) or simply see lifestyle/cultural shifts (as we see perhaps most prominently in B.C.) to have institutional and cultural homes for this subculture, but it's not there yet. We won't see it develop in the college and university system adequately, so it'll have to come through ad hoc partnerships and experiments with those institutions. It'll have to be fostered through online community. Through offline communities like the meetups and geek dinners. And through remarkable new conferences put together by selfless connectors.

All that being said, this country will succeed and shift to heavy online spending in spite of itself. Why? It's the big budgets. Big-company culture has its drawbacks, but by 2009 that correct percentage of overall ad budgets will have moved over to online and to search, because eventually top execs will see that logic, will have read my next book, seen Gord's next talk, listened to a presentation by Martin at Yahoo Search Marketing Canada or the new head of Google Canada, and will have jotted search down for 30-40% of nontraditional ad spending, which in itself will grow to 30-40% of all ad spending.

Like financing a mining play, maybe search and ecommerce in Canada succeeds because of some figures that get sketched out on a napkin and decided at the highest levels. That's not the same as succeeding because the subculture grows, or influential people "see the light" early on because they're forgoing their 30 nights a year in the Air Canada Centre box seats to maybe study up on this stuff. (Fortunately, if Balsillie brings another hockey team here, entrepreneurial online-savvy learning materials will be mandatory reading before entry to the box.)

Search marketing and ecommerce in Canada won't succeed perhaps for all the right reasons, but I'm saying they still succeed. Based on the sheer compelling reasons for moving ad budgets and talents over to online user experiences and commerce, it'll succeed wildly. Budgets will increase in 2009-10 in that hockey-stick way.

And in part that'll be made possible by the unique history of a free, peaceful, diverse country that gave its best minds reasonable space in which to think and develop, and enough reasons to stay that Hotchkiss stays here. Hopefully, at least, some of those reasons include dollar signs. But Hotchkiss is also going to need a few more fellow players in this subcultural sandbox to keep him from picking up his pail in seek of a new playground.

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Posted by Andrew Goodman




Tuesday, February 27, 2007

MSN AdCenter Canada Launch: Where's Barry?

It's an inconvenient truth: Canada's online ad market is 10-15% of the US market, give or take. Inside that market, Microsoft has around 10% share of search referrals, on a good day. Also, Canadian marketers are more reluctant to spend and experiment online. So the amount of attention that a marketer with a pan-North-American focus might pay to Google AdWords in the U.S. as compared with MSN adCenter in Canada would, if we're going by associated dollar spend... if you have the math right, it should be a ratio of about 50:1. Throw in a little ADD, and you're talking 100:1.

So I suppose that's why a really big (and quite fun) Microsoft launch event today seemed strangely out of sync with reality.

While MSN aDcEnTer Canada (heretofore to be called microsoft adcentre, eh) had its Kevin Lee, it didn't have its Barry Schwartz. Please tell me I'm not the first to blog about this? I know some folks at the 400-attendees-strong Canada launch of MSN adCenter today were snapping the usual photos, but I don't see much live-blogging-chatter out there yet.

Maybe this is because it just isn't a big deal, in the sense that "you're getting to discover it much as we did several months ago in the States," as one speaker put it. Yawn?

However, it felt like it was supposed to be a big deal. Tony Robbins jumping up and down big. Steve Jobs dwarfed by a giant phone image big. Or maybe just, "thanks for acknowledging our country" big. Fair enuff.

We were wooed by a mysterious email and a fancy flash invite at a URL called thesearchisover.ca, followed by a collection of cookie-tin type boxes in the mail, containing a USB flash card, redundantly inviting people again but arriving after the RSVP deadline. Somehow, we managed to decipher it and show up, even without Ms. Dewey's help.

Entering the facility (Muzik nightclub at Exhibition Place) after dispatching the valet parking formalities, we encountered much signage, eventually making our way through the cavernous club towards the large hall. The light and sound show was louder than, say, Yahoo's recent Canada launch. It felt positively Ballmeresque -- though we were really just getting glorified Powerpoint.

Oddly, a business professor from UWO Ivey acted as the MC for the event. Some Microsoft folks spoke onstage about how excited they were. Quite a contingent from the Redmond and New York MSN offices were on hand too. And Did-It's Kevin Lee gave the most detailed presentation extolling the virtues of the adCenter platform.

Nothing new to see, but a reminder that yes, the platform does allow for some cool experimentation, segmentation, and learning.

Practically speaking, combining Microsoft's third-place status in search referrals with Canada's lower overall search volume (10-20% of the US market depending on the vertical), it's actually a pretty tough sell. Low volume search in a low volume place. To make it as clear as I can, if we were focusing just on Canada, we'd generally be looking at some pretty low-volume campaigns. Not only that, but as Martin Byrne over at YSM Canada reminds us, "search isn't sexy." (Even when you have Sam Roberts playing at the event.)

There will be writeups in the media, of course. I hope observers understand the importance of the paid search part of the market in general, but I also hope they get the market share numbers right. I believe at least a couple of the reporters out there are savvy enough to look at their own media companies' in-house search referral stats. That should put the story in perspective. Microsoft is in third place, no matter how hard you try to Sympatico up the story.

A glossy, impressive third place - well ahead of the also-rans - and definitely diverse and part of a very large company. But - still behind Yahoo, and those other guys.

A deeper explanation and visuals around, say, geotargeting, would have been time and cash better spent than the Star Trek intro imagery. Or maybe dull old Al Gore up there with a graph or two. Boring works nowadays. See: Oscar Night, 2007.

Speaking of local search in Canada, there is a steady stream of news on that front. There are several developments brewing, including the imminent launch of RedToronto's new brand (and new product and totally new approach to local search). I think I can tell you it's an offshoot of their merger with Zip411 and that it will be called Zip Something-or-Other. Some interesting ideas percolating there!

Also, Hyperlocal Media - which has launched with a couple of successful pilot sites including one in Brooklyn, is launching a Toronto site, Until Monday Toronto.

Whoops -- wasn't I supposed to be talking about Microsoft?

Points for trying - very hard. You have to hand it to whoever thought of offering blue drinks dubbed the "Microsoft Conversion." Talk about a double entendre. It wasn't a religious experience for me personally, as I opted for a Heineken. But I do in fact accept the premise that Microsoft paid traffic converts very well. The data never lie.

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Posted by Andrew Goodman




Monday, February 05, 2007

YSM Confident in Canadian Rollout

Last week I attended the Yahoo Search Marketing launch event in downtown Toronto (held at Kai Lounge). It's intended to confirm to Canadian advertisers that yes, now you can use the full suite of search marketing tools to target just Canadian searchers; you can geotarget; and you can do all of this using the new Panama platform. This is now live with a full complement of support reps available to provide support and assistance. My company hasn't worked with a huge number of Canada-only campaigns in the past, but coincidentally demand for it is now picking up and questions about Yahoo are increasingly common now that companies are aware of it as a second option after AdWords. An example of a field where you pretty much won't be marketing "across the board" to the U.S. and Canada would be a highly regulated area like drug trials or pharmaceuticals. As another example, a major Canada-only ecommerce site I'm pitching right now will benefit immediately from the Yahoo rollout. Money will no longer be left on the table due to platform limitations. What were companies doing in the past? Well, nothing. You couldn't buy PPC just for Canada through Yahoo.

For those who are confused by this latest launch event - because it's the second time Yahoo has held a launch event for YSM in Toronto in the past few months - I think this latest was more of a "we're flipping the switch" reminder to a selection of businesses who are particularly plugged into the scene. The previous event was broader-based and intended to gain media attention and to introduce the local advertising community to a range of Yahoo execs.

Of course for oldtimers in the industry there was little new here, but the agency community and larger advertisers should take note that Yahoo consistently refers to the extensible nature of the Panama platform. Eventually (similar to Google's trajectory), you'll be able to bid on a range of media through the auction. That consolidation is healthy but it's going to be awhile before it reaches critical mass.

I'm not sure how accurate this is, but at a dinner following the event I was told that the Yahoo Canada team has grown to well over 100, currently all crammed into the Front Street office (though they're still on track to move to a more spacious location sometime this year). The team specifically devoted to search marketing is smaller, of course - Yahoo's a diversified company so that explains the "well over 100" number.

I haven't seen much coverage of this event, other than Sulemann Ahmed's brief overview. What Sulemann didn't cover was the door prizes. In keeping with the company's fun image they had a few giveaways for those who handed in business cards. After the first ho-hum drawing, all eyes were on the next prize: the video iPod. I apologized to the friend standing next to me, warning her that "I always win the door prizes at these things." The next thing you know, her name was being called as the owner of a new iPod! So much for me being evil. :)

The final door prize, dinner and Raptors tickets, was going to be a great way for me to treat some of my buddies, so I was really looking forward to winning that one. Unfortunately, Martin Byrne (Director of YSM Canada), the MC, called me over to do the drawing, so I was ruled out! A guy from Lavalife won it. I apologize for having trouble reading his name (small white print on a bright red business card). Or maybe this was because I still had my eyes shut from the random drawing process.

It is just good to see that due to an influx of full time Yahoo people in Toronto, there are more search-savvy people to discuss customer targeting with and to generally advance the cause. Some staff have been lured back from sojourns in the UK and continental Europe - call it Canada's brain gain. Yahoo plans a full slate of events to evangelize search to marketers in Canada, beginning with some introductory level academy type courses (by a third party company) at a very reasonable cost.

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Posted by Andrew Goodman




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