Who has earned my respect and business?
Recently I had the opportunity to call customer service for two products at either end of the price continuum.
Bison Designs - these folks make belts using webbing and plastic buckles. I've had a couple because they are perfect for travel - don't have to remove for security, pack lite, and go with everything. The plastic buckle on one broke and after checking REI and other outdoor shops for a replacement buckle we called them. They said - 'send it in and we'll fix it.' Great for a $12 belt bought several years ago.
Weber Grills - recently redeemed a bunch of miles for a new gas grill (don't miss the road warrior lifestyle). It came with white glove service etc. and it was on the deck; the first night the wind literally blew the doors off. Seems a plastic guard that looked like trim should have been removed. A call to customer service resulted in two brand doors sent over-night. Then they sent me more powerful magnets to make sure the doors stayed shut.
Both have earned my respect for going beyond my expectations.
Thursday, January 29, 2009
Sunday, January 25, 2009
Openness of Social Media
How does context effect response?
For an interesting discussion and reaction to just one tweet that said in part - "I would die if I had to live here" - see David Henderson's "How not to be a key online influencer". Its the story about a vendor visiting a client's city to present and made the above point. The discussion (230+ comments) illustrates that we still don't quite have a handle on the appropriateness of social media as a personal tool when part of a larger business relationship.
This makes for a great case study. The questions I posted on the original post are about context:
For an interesting discussion and reaction to just one tweet that said in part - "I would die if I had to live here" - see David Henderson's "How not to be a key online influencer". Its the story about a vendor visiting a client's city to present and made the above point. The discussion (230+ comments) illustrates that we still don't quite have a handle on the appropriateness of social media as a personal tool when part of a larger business relationship.
This makes for a great case study. The questions I posted on the original post are about context:
- What would have been the response if the tweet came from their largest client instead of a vendor?
- What if the tweet came while on vacation instead of on the client’s dime?
- How do B2B relationships differ from B2C relationships?
- What expectations should a client have regarding a vendor’s staff participating in any public communication program?
- How would this scenario have played out in a different industry? say a patent lawyer tweeting about a client’s product
- If the tweet were from an executive coming to speak about upgrading the inventory management system, would it be different?
Thursday, January 22, 2009
The Meaning of Marketing
What should we be really doing when we plan?
Tim Leberecht's post on Pop!Tech about "marketing with meaning" provides a great summary of the purpose behind the campaign - any campaign. It provides a holistic view of what we need to achieve; it even illustrates how various tactics fit in.
Using the Starbuck's "I'm In" campaign as background, Tim outlines the elements of style for marketing.
Tim Leberecht's post on Pop!Tech about "marketing with meaning" provides a great summary of the purpose behind the campaign - any campaign. It provides a holistic view of what we need to achieve; it even illustrates how various tactics fit in.
Using the Starbuck's "I'm In" campaign as background, Tim outlines the elements of style for marketing.
- Social - as a brand, we're part of the community
- Personal - it's one step at a time; micro-focused
- Storytelling - relate the message via a resonant and simple theme
- Disruptive - challenge the status quo of our thinking
- Responsible - offer a collective, aspirational purpose
Tuesday, January 20, 2009
The Technology Component of Social Media
Just how does one scale in social media?
We know that this aspect of marketing is facilitating the passing of a message via humans. We also know that if left to its own devices it may not scale very well. A given message usually decays quickly as it spreads throughout a network; hence the thoughts of Duncan Watts and the "Big Seed". Anecdotal evidence also suggests that social media is very labor intensive - monitoring, tweeting, commenting, etc. does not have the leverage that traditional media does. Adding another flight of impressions generates a bigger result (reach, frequency, leads, etc.) than the effort required to implement.
In an iMedia article on a new approach to delivering social media programs, Cynthia Francis of Reality Digital suggests that technology partners should be part of the agency's offering. Having worked for technology companies and marketing firms; great advice - but for other reasons.
Yes, I'd rather have 10 evangelists than 1 million blank stares but finding another 100 just like the first 10 takes work. It is here that technology could play an interesting role.
Questions:
Is it likely that social media campaigns will have similar budgets to regular media?
Are technology components, e.g. video mash-ups, experiential ads and sites, facilitated forwarding, etc, the equivalent to a media buy?
What technology innovations will emerge to achieve scalability? (We know about ad serving based on the social graph, but what else.)
We know that this aspect of marketing is facilitating the passing of a message via humans. We also know that if left to its own devices it may not scale very well. A given message usually decays quickly as it spreads throughout a network; hence the thoughts of Duncan Watts and the "Big Seed". Anecdotal evidence also suggests that social media is very labor intensive - monitoring, tweeting, commenting, etc. does not have the leverage that traditional media does. Adding another flight of impressions generates a bigger result (reach, frequency, leads, etc.) than the effort required to implement.
In an iMedia article on a new approach to delivering social media programs, Cynthia Francis of Reality Digital suggests that technology partners should be part of the agency's offering. Having worked for technology companies and marketing firms; great advice - but for other reasons.
Yes, I'd rather have 10 evangelists than 1 million blank stares but finding another 100 just like the first 10 takes work. It is here that technology could play an interesting role.
Questions:
Is it likely that social media campaigns will have similar budgets to regular media?
Are technology components, e.g. video mash-ups, experiential ads and sites, facilitated forwarding, etc, the equivalent to a media buy?
What technology innovations will emerge to achieve scalability? (We know about ad serving based on the social graph, but what else.)
Thursday, January 15, 2009
Twitter Shows the Partisan Lines of Congress
Social Networks Reach Critical Mass
Who and how many people use social networks?
The answer was answered by the Pew Internet Project in their recent report released yesterday.
Overall, among adult Internet users 1 of 3 has at least one profile. This is up from 1 in 12 just three short years ago. And yes, it skews young - ranging from 75% among the 18-24 segment to 7% of the 65+ audience.
They use it to connect with friends and family. It seems to be replacing the more synchronous and media restrictive platforms of bygone eras - like email and phones. The singular advantage of social networks as a communication platform is that they facilitate multiple connections over time, distance, and interests.
The answer was answered by the Pew Internet Project in their recent report released yesterday.
Overall, among adult Internet users 1 of 3 has at least one profile. This is up from 1 in 12 just three short years ago. And yes, it skews young - ranging from 75% among the 18-24 segment to 7% of the 65+ audience.
They use it to connect with friends and family. It seems to be replacing the more synchronous and media restrictive platforms of bygone eras - like email and phones. The singular advantage of social networks as a communication platform is that they facilitate multiple connections over time, distance, and interests.
Thursday, January 08, 2009
Social Networks and Customer Conversion Strategy
How are social networks used in marketing?
There's been a lot of discussion about the performance of advertising on social networks. Most of it suggests that 'it doesn't work very well' since revenue per user per month pales in comparison to other content-rich sites like cable companies, newspapers, etc.
Rather than focus on the question of how to improve advertising performance a different question arises: How can we utilize social networks in a complete contact strategy and sales funnel? Is there a better place for this ubiquitous information?
Consider a typical lead-generation scenario: For every 100 leads sales or conversions are often measured in the single digit range. A 3% conversion rate means that the acquisition cost of a $50 lead is north of $1,500.
For high-consideration products there are often several steps between lead and close: "Yes, I'm interested." and "Yes, I'll do it." Both of these depend on the development of a relationship of trust via a contact strategy.
So rather than ask a myriad of questions on a form in hope of getting useful information an alternative would be to understand the customer better by learning what makes them tick - they'll be happy to tell you. In fact the profiles people post on social networks offer a wealth of information in order to build rapport.
This approach requires three steps:
1. Develop guidelines and training on how to use social networks in sales and marketing
2. Develop a process and information architecture for leveraging social network profiles
3. Develop a feedback process to ensure that customers are comfortable with building relationships this way.
Building a stronger, more personal relationship would directly impact the Cost Per Acquisition; much more so than reducing the Cost Per Lead.
For an example of the issues involved see the discussion about social networks in the admissions process at selective colleges and universities here. Not all categories have such an imbalance between supply and demand (only so many cheeks can fit in the seats). In much more competitive categories where there are no capacity constraints the opportunities are greater.
Disclosure: I've worked with various Kaplan divisions but not the Test-Prep group that sponsored the research cited above.
There's been a lot of discussion about the performance of advertising on social networks. Most of it suggests that 'it doesn't work very well' since revenue per user per month pales in comparison to other content-rich sites like cable companies, newspapers, etc.
Rather than focus on the question of how to improve advertising performance a different question arises: How can we utilize social networks in a complete contact strategy and sales funnel? Is there a better place for this ubiquitous information?
Consider a typical lead-generation scenario: For every 100 leads sales or conversions are often measured in the single digit range. A 3% conversion rate means that the acquisition cost of a $50 lead is north of $1,500.
For high-consideration products there are often several steps between lead and close: "Yes, I'm interested." and "Yes, I'll do it." Both of these depend on the development of a relationship of trust via a contact strategy.
So rather than ask a myriad of questions on a form in hope of getting useful information an alternative would be to understand the customer better by learning what makes them tick - they'll be happy to tell you. In fact the profiles people post on social networks offer a wealth of information in order to build rapport.
This approach requires three steps:
1. Develop guidelines and training on how to use social networks in sales and marketing
2. Develop a process and information architecture for leveraging social network profiles
3. Develop a feedback process to ensure that customers are comfortable with building relationships this way.
Building a stronger, more personal relationship would directly impact the Cost Per Acquisition; much more so than reducing the Cost Per Lead.
For an example of the issues involved see the discussion about social networks in the admissions process at selective colleges and universities here. Not all categories have such an imbalance between supply and demand (only so many cheeks can fit in the seats). In much more competitive categories where there are no capacity constraints the opportunities are greater.
Disclosure: I've worked with various Kaplan divisions but not the Test-Prep group that sponsored the research cited above.
Stagnant Brands
Why do brands get the doldrums?
Marketing has a unique challenge in that we are responsible for changing the status quo - grow the market, find new audiences, align new products and services with unmet needs. In a recent McKinsey survey on corporate decision making - these areas ranked highest on the list of strategic decisions made.
This creative mandate means that all aspects of a product must be fresh, topical, and on point. It often takes a new set of eyes to think through why a brand might be stagnant.
From the customer's perspective, there are three reasons why a brand isn't meeting expectations.
1. There is no promise; people don't know what the brand stands for
2. The brand doesn't deliver on a promise made
3. A promise is irrelevant today and doesn't work any more
Agencies exist to be fired. Can't remember where I first heard it, but it seems to be true. Presuming there aren't serious personnel issues, then why is this true? What is it about marketing that prevents a long-term,monogamous relationship from forming?
I think too often it is getting caught up in a transactional mode of thinking - a time-limited campaign, a new launch, and quarterly numbers. My new year's resolution is to help marketers focus on why a brand is/is not successful: What need is being satisfied? Who has that need? How do we best communicate with them?
Marketing has a unique challenge in that we are responsible for changing the status quo - grow the market, find new audiences, align new products and services with unmet needs. In a recent McKinsey survey on corporate decision making - these areas ranked highest on the list of strategic decisions made.
This creative mandate means that all aspects of a product must be fresh, topical, and on point. It often takes a new set of eyes to think through why a brand might be stagnant.
From the customer's perspective, there are three reasons why a brand isn't meeting expectations.
1. There is no promise; people don't know what the brand stands for
2. The brand doesn't deliver on a promise made
3. A promise is irrelevant today and doesn't work any more
Agencies exist to be fired. Can't remember where I first heard it, but it seems to be true. Presuming there aren't serious personnel issues, then why is this true? What is it about marketing that prevents a long-term,monogamous relationship from forming?
I think too often it is getting caught up in a transactional mode of thinking - a time-limited campaign, a new launch, and quarterly numbers. My new year's resolution is to help marketers focus on why a brand is/is not successful: What need is being satisfied? Who has that need? How do we best communicate with them?
Wednesday, December 24, 2008
Time to Get Engaged
What does being engaged mean?
The holidays are often the time to get engaged; I did - but that's a different story.
In marketing what does "Engagement" mean? In an iMedia article on predictions for 2008 comes the following:
Engagement is two or more parties coming together and forming a bond around an objective.
The holidays are often the time to get engaged; I did - but that's a different story.
In marketing what does "Engagement" mean? In an iMedia article on predictions for 2008 comes the following:
The American Association of Advertising Agencies and the Advertising Research Foundation, working together with the Interactive Advertising Bureau, came up with this definition: "Engagement is turning on a prospect to a brand idea enhanced by the surrounding context."This strikes me as a bit one-sided or linear and something a committee came up with. I like the automobile and kindergarten inspired definitions better: "contact by fitting together" as in the clutch or "sharing in the activities of a group"
Engagement is two or more parties coming together and forming a bond around an objective.
Monday, December 22, 2008
The Ying and Yang of Web 2.0
Just how does Web 2.0 actually work as a business model?
Just finished two books on the world of Web 2.0 and how it might work for any company. The first is Paul Gillin's "The New Influencers" which provides insight on how people adapt to the social media tools and use them to achieve their goals. The second is Amy Shuen's "Web 2.0: A Strategy Guide" which is more of a behind the scenes look at how Web 2.0 businesses actually work economically.
So, if you want to understand the J-curve of cash flow along with great examples of how the tools are applied check these outs.
Mr. Gillen covers the conversation side of social media - blogs, podcasts, RSS, etc. Enthusiasm is the common ingredient of all recipes of success.
The End Notes in Ms. Shuen's book will fill your bookshelves with the collection of all things Web 2.0.
Just finished two books on the world of Web 2.0 and how it might work for any company. The first is Paul Gillin's "The New Influencers" which provides insight on how people adapt to the social media tools and use them to achieve their goals. The second is Amy Shuen's "Web 2.0: A Strategy Guide" which is more of a behind the scenes look at how Web 2.0 businesses actually work economically.
So, if you want to understand the J-curve of cash flow along with great examples of how the tools are applied check these outs.
Mr. Gillen covers the conversation side of social media - blogs, podcasts, RSS, etc. Enthusiasm is the common ingredient of all recipes of success.
The End Notes in Ms. Shuen's book will fill your bookshelves with the collection of all things Web 2.0.
Friday, December 19, 2008
When Lightening Strikes
What makes Twitter so powerful?
Several cases of reputation management have been reported lately - Ford, U-Haul and Motrin all had a potential PR problem that spread quickly from sparks on Twitter. Shel Israel concluded on the Ford question:
If I had but one social media channel to monitor it would be Twitter because of its early-warning nature.
Several cases of reputation management have been reported lately - Ford, U-Haul and Motrin all had a potential PR problem that spread quickly from sparks on Twitter. Shel Israel concluded on the Ford question:
There is another fundamental issue. If your company finds itself in a reputation crisis, it is highly likely to spill into the social media. When it hits Twitter it is likely to move the fastest and go the furthest.The triggers for all three cases were very different, yet they all spread like wildfire.
- Ford - a cease and desist letter to a fan site
- U-Haul - poor customer service at a rental counter
- Motrin - an advertising campaign
- The network effect is extremely powerful - telling a friend of a friend of a friend ... is automatic and in real time. There are no firebreaks when everyone is pre-connected.
- With its limit on space, I can only post snippets of ideas. Twitter is great for pointing to thoughtful opinions or news articles, but in and of itself it is difficult to tell the whole story. This lends to top-of-mind, gut or knee-jerk reactions.
- The headline nature of tweets or the 'hey check this out' mode pushes copy writing to elicit a response by using strong, emotive words like 'loser'.
- It levels the playing field and the consumer as underdog with no way to voice her opinion is gone. There may be some collective 'we're not going to take it any more' and the company is used as an example rather than a specific target of dissatisfaction. I know my comments on Motrin were in this vein.
- And finally, unfortunately bad news always travels faster than good news because people like reading about it better. My father always called the late evening news 'the grims' because people wanted to know their world was safer than the outside.
If I had but one social media channel to monitor it would be Twitter because of its early-warning nature.
Thursday, December 18, 2008
Brand as Tribal Leader
Can a brand lead people?
Tribes, from Seth Godin, talks about why and how people should lead a group passionate about something, anything. In short, a leader assumes the risks of satisfying an unmet set of needs.
I understand the intent of the book was individuals, not unlike Tom Peter's "Brand You" - but I started thinking about marketing's role in social media. If you can't (shouldn't) advertise then what do you do? Simply 'joining the conversation' or allowing customers to 'hijack a brand' and take control doesn't necessarily achieve a brand's objectives.
Tribes, by definition, need a leader - someone to take them somewhere. Why can't it be a brand? More specifically, can a brand take on the attributes of a leader?
The qualities of a leader (pg 126 of Tribes) are:
Tribes, from Seth Godin, talks about why and how people should lead a group passionate about something, anything. In short, a leader assumes the risks of satisfying an unmet set of needs.
I understand the intent of the book was individuals, not unlike Tom Peter's "Brand You" - but I started thinking about marketing's role in social media. If you can't (shouldn't) advertise then what do you do? Simply 'joining the conversation' or allowing customers to 'hijack a brand' and take control doesn't necessarily achieve a brand's objectives.
Tribes, by definition, need a leader - someone to take them somewhere. Why can't it be a brand? More specifically, can a brand take on the attributes of a leader?
The qualities of a leader (pg 126 of Tribes) are:
- Leaders create a culture around their goal and involve others in that goal - thinking 'Pepsi Generation' or Fiskateers
- Leaders have and extraordinary amount of curiosity about the world they're trying to change - thinking Patagonia
- Leaders use charisma to attract and motivate followers - thinking Apple here and their stellar use of design (talk about charisma) or Harley Davidson's 'freedom'
- Leaders commit to a vision and make decisions based on that commitment - thinking Geek Squad, Southwest, and Walmart
- Leaders connect their followers to one another - thinking Being Girl from P&G, and Young and Free from credit union TDECU in Texas.
Holiday Greetings Card - Snowmen
Can you get your message in a holiday card?
From MarketingNPV - the folks that keep our eyes collectively on how marketing performs.
Made me smile a bunch.
Now the interactive part of me wanted to click on the image and be taken to a seasonal page that showed me how to balance the short term and long term; that's my real pain. Or maybe to something like JibJab's 'snowmen' site where I can upload pictures of the sales and marketing teams to create a snowball fight.
From MarketingNPV - the folks that keep our eyes collectively on how marketing performs.
Made me smile a bunch.
Now the interactive part of me wanted to click on the image and be taken to a seasonal page that showed me how to balance the short term and long term; that's my real pain. Or maybe to something like JibJab's 'snowmen' site where I can upload pictures of the sales and marketing teams to create a snowball fight.
Wednesday, December 17, 2008
Emulsifier Needed for Marketing
What's the right recipe for social networks and advertising?
Several articles this week on the lack of effectiveness of advertising in social networks; here's one on eMarketer. These articles raise the question: can advertising and social networks mix? It seems like they're oil and vinegar.
I'm a fan of vinaigrette and here's a simple recipe that I use that is a bit out of the ordinary since it is equal parts oil and vinegar rather than the traditional ratio of 3:1.
3 T Olive Oil
3 T Balsamic Vinegar
1 t Dijon-style mustard
1 t Kosher salt
Oil and vinegar don't normally mix, but the secret ingredient - mustard - does something to create a smooth and harmonious mixture that doesn't separate.
Why don't oil and vinegar blend?
The molecules involved aren't designed to attach to one another because one is charged (water) and one isn't (oil). As a result they each much prefer their own community and they band together. So, if their physical properties are incompatible with one another how do emulsifiers work? They broker a truce by fitting in within both communities - usually they are a wrapper around one of the ingredients to make the mixture more compatible. In a vinaigrette the charged water molecules (Balsamic vinegar) are wrapped by the mustard to eliminate the polarity. The result is a nice salad dressing.
So, if social networks and advertising are oil and vinegar, what's the emulsifier?
Advertising is charged. The worst offenders, or those with the highest charge, are likely the direct response ads goading you to do something now. Social network advertising should not entice to you leave the the community, what's the point of that?
Marketers have a message that they'd like to circulate easily among a social network, just like Balsamic vinegar in EVOO. They need to think like a mustard and wrap them in something that is much more compatible with the non-charged social network environment. Messages should be delivered as content with relevance and even amusement so that it stays within the community and adds to the overall experience.
If the acidic nature of advertising isn't smoothed over, it will end up in isolated pools off to the side being completely ignored.
Several articles this week on the lack of effectiveness of advertising in social networks; here's one on eMarketer. These articles raise the question: can advertising and social networks mix? It seems like they're oil and vinegar.
I'm a fan of vinaigrette and here's a simple recipe that I use that is a bit out of the ordinary since it is equal parts oil and vinegar rather than the traditional ratio of 3:1.
3 T Olive Oil
3 T Balsamic Vinegar
1 t Dijon-style mustard
1 t Kosher salt
Oil and vinegar don't normally mix, but the secret ingredient - mustard - does something to create a smooth and harmonious mixture that doesn't separate.
Why don't oil and vinegar blend?
The molecules involved aren't designed to attach to one another because one is charged (water) and one isn't (oil). As a result they each much prefer their own community and they band together. So, if their physical properties are incompatible with one another how do emulsifiers work? They broker a truce by fitting in within both communities - usually they are a wrapper around one of the ingredients to make the mixture more compatible. In a vinaigrette the charged water molecules (Balsamic vinegar) are wrapped by the mustard to eliminate the polarity. The result is a nice salad dressing.
So, if social networks and advertising are oil and vinegar, what's the emulsifier?
Advertising is charged. The worst offenders, or those with the highest charge, are likely the direct response ads goading you to do something now. Social network advertising should not entice to you leave the the community, what's the point of that?
Marketers have a message that they'd like to circulate easily among a social network, just like Balsamic vinegar in EVOO. They need to think like a mustard and wrap them in something that is much more compatible with the non-charged social network environment. Messages should be delivered as content with relevance and even amusement so that it stays within the community and adds to the overall experience.
If the acidic nature of advertising isn't smoothed over, it will end up in isolated pools off to the side being completely ignored.
Tuesday, December 16, 2008
Funding an Idea vs. a Company
What it is the difference between innovation and entrepreneurship?
In a recent post by my friend Allan Young on "The Startup Myth" he argues that what we need is entrepreneurs not start-ups. To understand the difference he makes the vivid point that entrepreneurs build companies not just try to get money for an idea. The end game is a viable, growing, successful business - the idea is merely a supporting player. This distinction suggests that entrepreneurship and innovation are not the same thing. This post attempts to make that distinction.
First, we need some definitions to work with. From the Web....
Based on these definitions its easy to see that not all innovations are appropriate for the entrepreneur, e.g. 'new and improved, version 3.0, and next generation.' McDonald's Big Mac was created to better compete in a local market. Conversely, there are opportunities for the entrepreneur that don't require an innovative idea, e.g. franchises and opening new markets. The Egyptian company building the cell phone network for North Korea is very entrepreneurial, but not necessarily innovative in the sense that cell phone networks are relatively mature (although I'd guess their way of doing this is different).
The economic model of angel investors or venture capitalists drives them to focus on the intersection because that is where the home runs are. Financially, for every 10 investments made only one will be successful, so EVERY opportunity funded has to have the chance of being the next big thing that covers all the other investments and produces a decent return for the entire portfolio. Since successful entrepreneurs are much scarcer than good ideas, the emphasis is nearly always on the team and not necessarily the idea. As proof, there are people who could get funding without an idea; but no idea will get funded without people.
So if your looking to fund a company what type of innovations should entrepreneurs pursue?
Weaving the ideas of Trout's "Differentiate or Die", Christensen's "Innovators Dilemma" and Kim & Mauborgne's "Blue Ocean Strategy" the best ideas are those that:
Hindsight suggests that the successful new companies solve all three requirements simultaneously. They define new categories and hence reap the rewards as it grows as the recognized 'leader' because order of entry is very important. They apply a different business model to the problem at hand - be it distribution model, how and where value is exchanged, mix of product and services, or something nobody else thought of yet so that competitors have to say 'we can't do it that way'. They create a new line-item in people's budget so it isn't so obvious that the money is coming from incumbents who fight to maintain their revenue streams. The definition of competition is the sales guy whose commission check you take.
In summary, violate every possible rule you've been taught and do the impossible:
In this space "Are you nuts?" is a compliment and means your on the right track.
In a recent post by my friend Allan Young on "The Startup Myth" he argues that what we need is entrepreneurs not start-ups. To understand the difference he makes the vivid point that entrepreneurs build companies not just try to get money for an idea. The end game is a viable, growing, successful business - the idea is merely a supporting player. This distinction suggests that entrepreneurship and innovation are not the same thing. This post attempts to make that distinction.
First, we need some definitions to work with. From the Web....
- Entrepreneur: "A person who takes the risk of organizing and operating a new business venture."
- Innovation: "The process whereby ideas for new (or improved) products, processes or services are developed and commercialized in the marketplace."
Based on these definitions its easy to see that not all innovations are appropriate for the entrepreneur, e.g. 'new and improved, version 3.0, and next generation.' McDonald's Big Mac was created to better compete in a local market. Conversely, there are opportunities for the entrepreneur that don't require an innovative idea, e.g. franchises and opening new markets. The Egyptian company building the cell phone network for North Korea is very entrepreneurial, but not necessarily innovative in the sense that cell phone networks are relatively mature (although I'd guess their way of doing this is different).The economic model of angel investors or venture capitalists drives them to focus on the intersection because that is where the home runs are. Financially, for every 10 investments made only one will be successful, so EVERY opportunity funded has to have the chance of being the next big thing that covers all the other investments and produces a decent return for the entire portfolio. Since successful entrepreneurs are much scarcer than good ideas, the emphasis is nearly always on the team and not necessarily the idea. As proof, there are people who could get funding without an idea; but no idea will get funded without people.So if your looking to fund a company what type of innovations should entrepreneurs pursue?
Weaving the ideas of Trout's "Differentiate or Die", Christensen's "Innovators Dilemma" and Kim & Mauborgne's "Blue Ocean Strategy" the best ideas are those that:
- Disrupt the current thinking about how the 'category' is defined in people's mind
- Change the way business is done
- Find net-new money from clients rather than redistributing an existing pot
Hindsight suggests that the successful new companies solve all three requirements simultaneously. They define new categories and hence reap the rewards as it grows as the recognized 'leader' because order of entry is very important. They apply a different business model to the problem at hand - be it distribution model, how and where value is exchanged, mix of product and services, or something nobody else thought of yet so that competitors have to say 'we can't do it that way'. They create a new line-item in people's budget so it isn't so obvious that the money is coming from incumbents who fight to maintain their revenue streams. The definition of competition is the sales guy whose commission check you take.
In summary, violate every possible rule you've been taught and do the impossible:
- Create a need then fill it; people can't tell you what they don't know so don't ask them.
- Do things the industry doesn't do; don't do things they do do.
- Rearrange the rank order of attribute importance; if speed is important sell power consumption.
- A start up in an existing category will suffer from the classic 'fear, uncertainty, and doubt' sales strategy of the market leader. So, damn them with faint praise as you explain that you do something different.
- A start up that doesn't change the rules of the game, will lose since 'those with money write the rules.' So find that differentiator and make it your sole beachhead.
- A start up that doesn't make people see a problem in a new light will always fail to overcome the inertia to change. So be patient with your audience as they learn to change their way of thinking.
- Southwest Airlines: provided access to second-tier markets; flew point-to-point, not hub-and-spoke; and made affordability the ONLY driver
- Cirque-du-Soleil: circus with a plot line in a strange language; stay-put, integrate music, get rid of animals, stars, and travel; theatrical value vs. individual acts
- Facebook: organize student communities; open the platform to third parties, ignore music; think of it as a cocktail party and not a teenager's bedroom (source)
In this space "Are you nuts?" is a compliment and means your on the right track.
The Social Side of Search
Is search social media?
In response to Jermiah Owyang's query on twitter I said "maybe". Since 140 characters is a bit short, here's my thinking.
The original question came from part of a post entitled 'so who do consumers trust?' It includes the following with italics added:
So to the question at hand: Are search results social media?
First, some definitions and assumptions:
1. Search refers to organic results and not paid.
2. Media are vehicles by which messages are carried, e.g broadcast media, online media, and social media.
3. Social is a fuzzy concept, but generally refers to people interacting in communities or groups.
Given the above, search results are definitely a medium by which a message is conveyed. "This page has several things we think you'll find relevant based on the keywords you entered." Reducing a bazillion pages to a simple set of 3-line bites that can be quickly scanned is the essence of search engines. With the help of the people writing those pages we have a very powerful medium for getting a message out.
But is it social?
The original point was that the engines use the human activities of organizing, linking and creating content (in part) to produce the set of recommendations shown. This makes it a set of 'social recommendations'.
In the strictest sense it is not direct, social interaction in the way word-of-mouth is. Nor is there an opportunity to clear up the issues of intent and context in the way that conversations allow. Finally, there is a fair amount of manipulation going on to get to the top of the page - when that is the sole objective it is only social to the extent that bullies are also social.
The second thought was about the search engine's role in the process. In a group or community, participants play an active role and usually stay involved. Search, and Google in particular, is a way station. They can be described as the world's largest and most successful travel agencies. Their mission is not to just organize the world's information but more importantly put us on the correct path toward a destination. If 'time on site' is a measure of engagement, then Google doesn't play a significant role as an active member of a community.
However, in a broader sense - what other medium do we have that allows us a peek at how others view the world? How do we find like minded individuals? How do we coalesce around the common interests that are the new demographics? Certainly advertising media don't provide this; they simply have another objective to achieve. It seems that in this sense search results provide an abstraction or snapshot of a set of human endeavors geared at telling their story. Since the algorithms look over their shoulders at what other people are doing (thinking?) it could be argued that they are in fact social recommendations.
So, I came up with the 'maybe.'
Why does this matter? Because the language of social media often defines how people talk about their needs, wants and desires. Thus, it should certainly be used in search marketing - both natural and paid. In fact, your brand monitoring efforts should report on the popularity not only of key words and their relationship with one another but also where they are likely to occur and with what other concepts and ideas to they relate to.
In response to Jermiah Owyang's query on twitter I said "maybe". Since 140 characters is a bit short, here's my thinking.
The original question came from part of a post entitled 'so who do consumers trust?' It includes the following with italics added:
50%: Say they trust portals/search engines: In Google We Trust, is that Charlene Li frequently used to tell me, and it still holds true. When you look closely, the search engine results in Google are really social recommendations. How so? The Google algorithm (while I’m over simplifying) puts a great deal of weight on how humans organize, link, and create content.
So to the question at hand: Are search results social media?
First, some definitions and assumptions:
1. Search refers to organic results and not paid.
2. Media are vehicles by which messages are carried, e.g broadcast media, online media, and social media.
3. Social is a fuzzy concept, but generally refers to people interacting in communities or groups.
Given the above, search results are definitely a medium by which a message is conveyed. "This page has several things we think you'll find relevant based on the keywords you entered." Reducing a bazillion pages to a simple set of 3-line bites that can be quickly scanned is the essence of search engines. With the help of the people writing those pages we have a very powerful medium for getting a message out.
But is it social?
The original point was that the engines use the human activities of organizing, linking and creating content (in part) to produce the set of recommendations shown. This makes it a set of 'social recommendations'.
In the strictest sense it is not direct, social interaction in the way word-of-mouth is. Nor is there an opportunity to clear up the issues of intent and context in the way that conversations allow. Finally, there is a fair amount of manipulation going on to get to the top of the page - when that is the sole objective it is only social to the extent that bullies are also social.
The second thought was about the search engine's role in the process. In a group or community, participants play an active role and usually stay involved. Search, and Google in particular, is a way station. They can be described as the world's largest and most successful travel agencies. Their mission is not to just organize the world's information but more importantly put us on the correct path toward a destination. If 'time on site' is a measure of engagement, then Google doesn't play a significant role as an active member of a community.
However, in a broader sense - what other medium do we have that allows us a peek at how others view the world? How do we find like minded individuals? How do we coalesce around the common interests that are the new demographics? Certainly advertising media don't provide this; they simply have another objective to achieve. It seems that in this sense search results provide an abstraction or snapshot of a set of human endeavors geared at telling their story. Since the algorithms look over their shoulders at what other people are doing (thinking?) it could be argued that they are in fact social recommendations.
So, I came up with the 'maybe.'
Why does this matter? Because the language of social media often defines how people talk about their needs, wants and desires. Thus, it should certainly be used in search marketing - both natural and paid. In fact, your brand monitoring efforts should report on the popularity not only of key words and their relationship with one another but also where they are likely to occur and with what other concepts and ideas to they relate to.
Friday, December 12, 2008
Marketing 2.0 as Defined by IT
What do IT deployment strategies offer marketing?
Amy Shuen's "Web 2.0: A Strategy Guide" offers a wide-ranging view of how business can work in this environment. Of particular interest is the relationship between 'Value' and 'Function'. In the IT world, only the most valuable projects get funded. Those that don't slip into the hack or do-without mode. SaaS, or software as a service, sits between the Build/Buy models and the muck about with Excel and hope it works.
SaaS and its 'on-demand' cousins create an opportunity to extend the reach of a solution by changing the cost-model to one that is shared across a group of clients. This effectively allows SaaS models to reach the long tail of business opportunities. Companies that can not afford to make or buy now can 'rent' so to speak. If the functionality is good enough, the competitive landscape changes radically because their is a real fuzzy line between the 'haves and have-nots'.
From the book:
It seems that social media, and its relationship to marketing objectives, falls into the same pattern. There are certain activities that clearly fall into the high-value therefore we control category. There are other marketing activities that accrue like the post-it notes illustrated above - ideas that may never see the light of day.
Certainly people are talking about things, i.e they are 'hacking' in the sense that it is not highly organized. In between are the functions that a community needs - sharing, opnionating, feedback, and sometimes bitching. If we consider social media as a service then it extends the reach of marketing into the long tail of both customers and marketing activities. To be sure, there are trade-offs on both sides but it seems that it is way to find common ground and level this playing field as well.
Amy Shuen's "Web 2.0: A Strategy Guide" offers a wide-ranging view of how business can work in this environment. Of particular interest is the relationship between 'Value' and 'Function'. In the IT world, only the most valuable projects get funded. Those that don't slip into the hack or do-without mode. SaaS, or software as a service, sits between the Build/Buy models and the muck about with Excel and hope it works.
SaaS and its 'on-demand' cousins create an opportunity to extend the reach of a solution by changing the cost-model to one that is shared across a group of clients. This effectively allows SaaS models to reach the long tail of business opportunities. Companies that can not afford to make or buy now can 'rent' so to speak. If the functionality is good enough, the competitive landscape changes radically because their is a real fuzzy line between the 'haves and have-nots'.
From the book:
It seems that social media, and its relationship to marketing objectives, falls into the same pattern. There are certain activities that clearly fall into the high-value therefore we control category. There are other marketing activities that accrue like the post-it notes illustrated above - ideas that may never see the light of day.
Certainly people are talking about things, i.e they are 'hacking' in the sense that it is not highly organized. In between are the functions that a community needs - sharing, opnionating, feedback, and sometimes bitching. If we consider social media as a service then it extends the reach of marketing into the long tail of both customers and marketing activities. To be sure, there are trade-offs on both sides but it seems that it is way to find common ground and level this playing field as well.
Completing the Social Graph
How many connections does a marketer need?
Mark Niehaus recently wrote a piece about the idea of linking social network data with traditional data to create a complete picture of every person in the US.
For a guy who spent a lot of time in the trenches of data analysis and systems; I love the challenge - in fact parts are being worked on right now by numerous players. For instance, we routinely append demographic, psychographic and purchase data to social network profiles to help understand where and how social networks are used.
The marketer in me has a different opinion. A couple of thoughts:
1. While 'data-driven marketing' is great, the ultimate marketing objective is more strategic: How do we design and deliver goods that satisfy people's needs? The risk of using a humongous 1-to-1 database is tempting, but that is one-directional.
2. Influence, the mystical concept of one person's leverage on another (or many), is a function of trust and relevance. This implies that there isn't just one social graph for marketing, but a bazillion - one for each decision being made.
3. Even if we know the connections, the interests, and the purchase history - do we have the restraint to use it appropriately? Sure, the data is public or generated from opt-in but unless we have an invitation to use it; we shouldn't. I was at an open house the other night where Governor Huntsman was also attending and talking with one of our joint connections. But unless someone brokered that introduction I wasn't going to barge in and show him my wares. I had all the data, the interests and connections - but the timing was in appropriate.
4. Data is a like a silent movie - we can see a lot things, but can't hear anything at all. Those verbal cues are critical for developing relationships.
Mark Niehaus recently wrote a piece about the idea of linking social network data with traditional data to create a complete picture of every person in the US.
For a guy who spent a lot of time in the trenches of data analysis and systems; I love the challenge - in fact parts are being worked on right now by numerous players. For instance, we routinely append demographic, psychographic and purchase data to social network profiles to help understand where and how social networks are used.
The marketer in me has a different opinion. A couple of thoughts:
1. While 'data-driven marketing' is great, the ultimate marketing objective is more strategic: How do we design and deliver goods that satisfy people's needs? The risk of using a humongous 1-to-1 database is tempting, but that is one-directional.
2. Influence, the mystical concept of one person's leverage on another (or many), is a function of trust and relevance. This implies that there isn't just one social graph for marketing, but a bazillion - one for each decision being made.
3. Even if we know the connections, the interests, and the purchase history - do we have the restraint to use it appropriately? Sure, the data is public or generated from opt-in but unless we have an invitation to use it; we shouldn't. I was at an open house the other night where Governor Huntsman was also attending and talking with one of our joint connections. But unless someone brokered that introduction I wasn't going to barge in and show him my wares. I had all the data, the interests and connections - but the timing was in appropriate.
4. Data is a like a silent movie - we can see a lot things, but can't hear anything at all. Those verbal cues are critical for developing relationships.
Thursday, December 11, 2008
Language Skills
What else can we learn from social media?
How your company and brand are portrayed is an obvious use of social media. Another application is understanding a new market. If your targeting either a new audience or entering a new category, understanding the language is key.
Working with a client on understanding a new category segment we found the following:
1. The sophistication of the language is very different, even when talking about the same thing.
2. Language and terminology can be perceived as either a barrier to entry or a protective shield around a club of those in the know.
3. There appears to be a trickle down effect of language -certain sources often create phrases or 'sound bytes' that work there way into the vernacular. (It would be interesting to trend the adoption of these over time - like a diffusion model.)
4. The hard part is identifying the appropriate terminology. Since social media monitoring typically works with a list of key words it becomes an iterative approach to find the next set of words.
Linguistic and semantic skills are required to leverage social media this way.
How your company and brand are portrayed is an obvious use of social media. Another application is understanding a new market. If your targeting either a new audience or entering a new category, understanding the language is key.
Working with a client on understanding a new category segment we found the following:
1. The sophistication of the language is very different, even when talking about the same thing.
2. Language and terminology can be perceived as either a barrier to entry or a protective shield around a club of those in the know.
3. There appears to be a trickle down effect of language -certain sources often create phrases or 'sound bytes' that work there way into the vernacular. (It would be interesting to trend the adoption of these over time - like a diffusion model.)
4. The hard part is identifying the appropriate terminology. Since social media monitoring typically works with a list of key words it becomes an iterative approach to find the next set of words.
Linguistic and semantic skills are required to leverage social media this way.
Saturday, November 29, 2008
Saving is The New Message
What are financial services companies saying to customers?
ING recently launched the "We the Savers" program - a declaration of a personal financial independence. They're taking a simple, interactive and social approach to spread some thoughts on responsible saving. They're not telling us what to do as much as asking us to agree and comment.
While I applaud the effort it could do more - possibly feed our message directly to congress.
I hope this grows.
ING recently launched the "We the Savers" program - a declaration of a personal financial independence. They're taking a simple, interactive and social approach to spread some thoughts on responsible saving. They're not telling us what to do as much as asking us to agree and comment.
While I applaud the effort it could do more - possibly feed our message directly to congress.
I hope this grows.
Subscribe to:
Posts (Atom)
Posts
