Archive for April, 2010

Rethinking Digital Marketing: From Awareness and Engagement to Empowerment

Thursday, April 29th, 2010

The traditional sales funnel worked in a world where we had limited number of channels reaching a wide number of eyeballs. The advent of the internet has brought forward a myriad number of alternative channels. As a result if you ask someone on the street, a random TV advertisement today is remembered by far less number of people than what the same advertisement would have gathered in the 60s.

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Traditional Sales Funnel (ref: Forrester Research)

Someone walking with a mobile phone in a shopping mall is no longer in the shopping mall, but impulsively dodging things that come by as the mind is somewhere else than in the physical realm. Someone scanning Twitter on a mobile phone while in a restaurant is no longer in the restaurant either, but lured into an endless flow of retweets.

“What information consumes is rather obvious: it consumes the attention of its recipients. Hence a wealth of information creates a poverty of attention.”
– Social Scientist Herbert Simon (1971)

Due to blogs, Twitter, Facebook, podcasts, information aggregators, news radars etc. our attention is now highly fragmented. Traditional mass media channels no longer have the same control as they used to have. Attention Economy is an economy where our attention has become scarce and fragmented, unfocused and disoriented, something Linda Stone calls Continuous Partial Attention (CPA): we only pay partially attention to what goes on around ourselves as we scan different channels for new opportunities, barely paying attention to things around us.

It is no surprise that the AIDA model (Attention + Interest, Desire + Action) from the end of 19th century is no longer as relevant as it used to be. In 2007 Forrester Research suggested that engagement is the new metric. They said that the traditional sales funnel based on awareness is broken and no longer works in digital media. In place they suggested a labyrinth depicted below, showing contributors as one potential outcome:

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The New Funnel According to Forrester Research

The complexity of this picture sure doesn’t look very welcoming to managers who want command and control, predictability and assurance for their marketing euros. What ever may be the case, the reality is that customers on the internet now have a wide variety of opportunities and low threshold to gain second hand opinion.

The labyrinth can be understood in many ways. Here is mine:

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Non-linear Inverted Funnel (ref: Teemu Arina)

Shifting from company perspective to customer perspective, things get highly non-linear and could go towards any path, not just the one the company depicted to be their sales funnel in the first place. From this perspective many sales funnels companies employ are delusional and grounded in false belief systems regarding the linearity of the purchase process and miss the beauty of the complexity involved in decision making.  Taking the point of view of the customer reveals insightful details about the process:

  1. Searching & Browsing: over 80% of browser sessions start with a search. Over 90% of people search online while considering a major investment like a digital camera, a trip or a car. Search is the primary means through which people start browsing the web.
  2. Recommendations & Persuasion: As soon as one fires a search, conversation appears. Forums full of second hand advice start to influence our decisions. Some people out there have a vast amount of knowledge and their opinions persuade our own opinions.
  3. Reinforcement & Sacrification: New information enforces our expectations but makes us also sacrifice initial assumptions, as new information emerges from the conversation.
  4. Usage & Value Creation: One decides to get involved with a solution or product. Usage reveals new requirements and reveals non-predetermined unexpected benefits. Value is created through the way how a solution is actually used, not what it appeared to be in the first place.
  5. Value Recognition & Self Expression: One starts to recognize the true, deep and hidden value the solution represents. You may as well call it wisdom in the context of using the product. Self expression leads to recommending and persuading the decisions of others: fancy details and complex reviews are being revealed to others on internet forums.

A friend of mine, Anssi Mäkelä from Nokia did a little mystery shopper experiment. As an avid Nike fan, he was looking to buy a pair of running shoes from the internet and took a screenshot of each website he visited in the process. Out of the around 180 screenshots only two were from websites owned by Nike. He only went to their website to have a feel of the products, as is the case with high-definition digital advertising.

The word engagement is so deep that it has even made itself to the values of Nokia. In their lobby I saw a banner reading “engaging consumers“. the same words insisted by a marketing person from Louis Vuitton in a conference talking about social media and how it relates to their brand. What this is to me is an oxymoron: active engagement and passive consumption do not go into the same sentence without a logical conflict.

“56% of American consumers feel both a stronger connection with, and better served by, companies when they can interact with them in a social media environment.”
Center for Media Research (2008)

The potential buyer no longer comes through the front door to be lured through various steps to become a customer. Because of Google, he is entering through any door he wants instead – even a window or a backdoor – armed with the opinions of his peers carried over from the conversations along the road. As he starts to use the product, he starts to speak to other customers about the true benefits and deficits of the product: even dodging manuals to hack the product to make it what one wants, as has happened at Ikeafans.com.

From this perspective, the word consumer describing passive behavior is no longer valid. Alternatives have been suggested for the new era of participation, such as produsage and prosumerism. In any case what we are actually talking about is empowerment. The customer is not just engaged, but in an ideal situation is empowered to go beyond the product: rate, comment, converse, feed forward, troubleshoot and hack the product in the context of other empowered customers.

Give a man a fish and he is engaged. Give a man a fishing rod and he is empowered.

Smart companies know how to leverage co-creativity. Such is the case with MyStarbucksIdea.com, understanding the importance of customers as active participants in product and service development processes. The value thus is created in interaction and not embedded in the product and production processes alone. This is what Esko Kilpi talks about in his blog about interactive value creation.

Sales funnel is a selfish concept utilized by companies who are mainly interested in themselves. Words like “capturing leads”, “lead acquisition”, “customer retention” and “engaging consumers” are concepts emerging from looking inside-out from oneself as a company, rather than outside-in.

Smart companies switch off their corp-ego-centric world view and make customer-centricity a true value evident in their tactics in practice, not just an empty shell in their mission statement. To push the boundaries a little bit, attention and awareness are also selfish concepts. The true currency is not attention but the intention of your customers: intent to do something, not just attention to marketing messages. In an Intention Economy,  customers are empowered participants.

“We see our customers as invited guests to a party, and we are the hosts. It’s our job every day to make every important aspect of the customer experience a little bit better.”
– Jeff Bezos, CEO of Amazon.com

Social Media in Education, Disorganizations and the Lifecycle of Emergence

Tuesday, April 27th, 2010

5 years ago a small group including me and Teemu Leinonen formed the Finnish Association of Free, Libre and Open Source Software in Education (FLOSSE). Although we did some great things the effort didn’t last because the people involved were not that interested in running a traditional association. As in Robert Putnam’s book Bowling Alone: America’s Declining Social Capital, internet enables individualization of leisure time via the Internet and as a result, participation in traditional formal associations is in a decline.

As Clay Shirky outlines in his book Here Comes Everybody: The Power of Organizing Without Organizations, as the transaction costs (in reference to British guru on economics Ronald Coase) for cooperative work drops as a consequence of internet enabled mass collaboration, things tend to happen in a decentralized way without the need for centralized formal organizations. There are many examples of such forces at play, e.g. Wikitravel or OhMyNews.

In Finland we have witnessed the emergence of a decentralized virtual organization called Sometu (sosiaalinen media oppimisen tukena – social media in support of learning). This (dis)organization consists of over 3000 teachers, researchers and other people interested in social media in education. Sometu was formed in the end of 2007 and has grown rapidly since. Their main tool is Ning, but they use a wide variety of other social media tools to carry out educational experiments.

Now that Ning is going more commercial and social media conversation is becoming more overheated and tiring on the educational sector, people like Teemu Leinonen (at ITK-conference) and Tarmo Toikkanen have started to question the aim of Sometu and its mission. Sometu has started to live a life of its own as an echo chamber for educational social media fanatics with their own little experiments with a questionable degree of impact. With a more clear purpose such a (dis)organization could become much stronger and meaningful force in transforming the educational sector. Will it be capable for this?

With great interest I read Dave Pollard’s post on the Lifecycle of Emergence. He talks how intrigued he is of “flow” models depicting the dynamics and cyclic nature of complex systems. He talks about the details of his discovery of Meg Wheatley and Debbie Frieze’s (Berkana Institute) model of Lifecycles of Emergence and explains the model with the following picture:

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The Lifecycle of Emergence. Illustration: Dave Pollard, original by Chris Corrigan

When I saw this picture Sometu network immediately came to my mind. As I see it, it was set up by pioneers who named the network. Then it started rapidly evolving as a network as other enthusiasts joined, eventually emerging as a community of practice for using social media in educational practice. A lot of attention and success stories were built, illuminating the (dis)organization’s activities. As more newcomers joined and as the activity and transparency of the group’s activities grew, it became a major system of influence for educational transformation – until someone said that the emperor wears no clothes.

As with anything, technology is like a chair without two legs if the cultural transformation underlying it is missing or unclear for the user. If things get technologically driven – as Sometu seems to be too much so for some people – the question then becomes what is the cultural innovation behind the scenes. This could be concentrated as a mantra, mission or vision for such an organization, but such statements may become empty in meaning.

Influencing real change in education is exceptionally hard. Networks like Sometu need to carefully examine the real competencies they have and focus on those to avoid decline and jump to a new cycle of opportunities. This will be hard, especially if even the originating founders don’t know themselves what would be the forces that will keep their vague network together in the future – simple interest in tools for education is not enough.

Just as Bruce Sterling said to mobile developers at the Mobile Monday Amsterdam:

“I want you to think real hard about the values you are going to save and stop worrying about the plastic”.

Six Non-Thinking Socks

Tuesday, April 20th, 2010

Six Thinking Hats is a well known brainstorming method designed by Dr. Edward de Bono. Six Hats aims to help a group to think more effectively. The idea is to use different hats symbolically, in order to take different productive points of view to a conversation such as positive thinking, information & fact driven argumentation and critical judgment.

But what would be the opposite of Six Thinking Hats, points of view to a conversation that would be damaging and non-productive from the group effort point of view. Something that would eventually bring the conversation to a halt, a dead-end or even a fight? On a long lunch today with my colleagues we designed just that.

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Six Non-Thinking Socks

How to destroy a potentially fruitful conversation and brainstorming session by just being present.

1. White Socks – Direct Interruption

What ever is being said is being interrupted by speaking over and loud. If someone starts to interrupt you too, just rise your voice and continue.

2. Red Socks – Getting Personal

Every point that is provided is cleverly turned into a personal assault targeting the character and personality of the fellow team player.

3. Black Socks – Unthinking

Use every logical fallacy in the book to confuse the conversation with arguments that first sound reasonable but turn out to be totally flawed in the very details.

4. Yellow Socks – Blatant Ignorance

When someone is speaking, just pretend that you are not listening. Look at the walls, at your clock and knock your fingers on the table. Moan.

5. Green Socks – Extreme Pessimism

It is the worst possible day of your life. Everything that is being said is viewed through lenses of absolute negativity and likelihood for failure. Cast a dark shadow on the whole conversation and start speculating what could most possibly go wrong.

6. Blue Socks – Unreasonable Haste

You are in such a hurry that there is no point in thinking about anything longer than a second – maybe two on a good day. No time to think – decisions are made based on intuition alone.

So, there you have it. Not too far away from your typical meeting.

Now go on and use this method in your next meeting and report back the results!

Social Media and the Volcano: an Overview

Sunday, April 18th, 2010

I had to skip a flight to Lapland for giving a presentation due to the volcano eruption in Iceland – first force majeure for me. Due to curiosity, I’ve been keeping an eye on the phenomena from the social media point of view. It is obvious that once again social media is playing an important role here for disaster recovery.

Especially real-time reporting and data has become increasingly important. Twitter and real-time mashups turn out to be most useful on the real-time web side. Various online communities on Facebook and elsewhere are providing solutions and support for those who are still out there. Events like this could be tremendous opportunities for companies customer support departments to listen and react accordingly and provide some relief to crowded phone support lines.

ishot 34 Social Media and the Volcano: an Overview

Most important tags for following the volcano related information on Twitter are #volcano, #ashtag, #getmehome and #roadsharing. Here is a chart that shows that the conversation is still going strong with #ashtag (started by twitter user Angry Britain at approximately 7:31am on Thursday 15th) and #getmehome rising as of sunday:

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Twitter tag trends for the volcano discussion (stats: Trendistic 2010)

Volcano-stranded travelers have turned to social media for alternative transportation, accommodation and other support.

On Facebook, writer Tod Brilliant organized his own Facebook group “When Volcanoes Erupt: A Survival Guide for Stranded Travelers” (531 members as of writing) a moment after he and his wife Andrea Barrett – who is 31 weeks pregnant – found themselves unable to fly home to California from London’s Heathrow airport after a wedding. The group features country specific advice.

Carpool Europe (1575 members as of writing) on Facebook helps people to find a ride in Europe.

ishot 37 Social Media and the Volcano: an Overview

Stuck in Helsinki – accommodation during the ash cloud (250 members as of writing) is providing a channel for those stranded in Finland.

Dohop.com travel search site organized an interactive Google map mashup of the ash plume showing aiport status.

On the real-time data side, Radarvirtuel.com shows airplane traffic and the ash cloud on a real-time map.

TED quickly approved a group to organize TEDxVolcano in London after a whole group of people participating at the Skoll World Forum got stranded.

Someone even set up a Twitter account for the ash cloud and gained over 2000 followers in a short time. Another volcano pretender here.

Roadsharing.com and Couchsurfing.org websites designed for sharing rides and accommodation just became more popular, not to mention image pools on Flickr.com for volcanic eruptions.

Various Airlines are helping their customers on Facebook and Twitter regarding the issue. Good job so far by airBaltic (33 300 members as of writing) with ongoing updates on the issue. The finnish arline Finnair is not doing as well, with only some official updates on Facebook (7500 members as of writing) and no real support. Finnair’s  Twitter account is also completely silent.

Future of Digital Reqruitment, Employment and Work

Wednesday, April 14th, 2010

Today I have some ideas for you that could revolutionize the way you do business.

ishot 27 Future of Digital Reqruitment, Employment and WorkWhat facinates me is how quickly the traditional recruitment processes are getting inefficient and old because of the emergence of new digital tools for matching open jobs with potential providers. It is already well known that everything that could be automated, will be automated. Outsourcing of repetitive work to machines or outsourcing partners is not new. But how about your own employees? The workforce of the future is a netforce, mobilized through the internet to participate in organizational tasks and processes upon need.

In an uncertain environment companies keep underused people on a payroll because they may need them very soon again. Outsourcing tasks is often a cumbersome management problem of finding the right providers, working out deals and keeping up with the quality of deliverables.

Utilization rate may be very low for certain people working for an organization. A good example might be advertising agencies: the company’s real core asset is the ability to conceptualize new ideas for marketing and communication and sell them to a customer, yet a lot of flash coders, graphic designers and copywriters sit underused with lack of projects on sight. At best, the additional time is used to work on pitching new customers.

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Pitches for a Job at Elance.com

Digital recruitment processes will change this. Reqruitment markets like Elance.com, RentACoder, Guru.com, oDesk and designer support services like iStockPhoto and 99Designs in combination with latest digital working environments may as well change the world of reqruitment and how routine work is carried out. On-demand online workforce will help coping with uncertainty through decreased overhead and transaction costs. The end result will be increased efficiency, reduction of labour costs and falling prices. In other words, comptetive advantages.

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Provider Profile at Elance.com

New business models will emerge, where a company employs only effective communicators, such as key account managers, (online) collaboration experts and creative problem solvers. The value of work done alone will drop dramatically. The work that used to be predictable and based on expertise grounded in training and repetition will be outsourced and will start to move freely between organizations. The new netforce will work for multiple employers at one time and be available on-demand. Such an organization will become small, flat and agile like nanotechnology, although the turnover per employee may rise dramatically.

It will be easy to compare potential providers and individuals, because other organizations will do the evaluation for you. Digital CVs will include dynamic real-time performance indicators based on peer-reviews from other organizations. No more endless interviews with potential employees who selectively expose to your their past activities and try to cast as optimistic picture as possible about themselves. No more probation times, headhunters, psychological tests or other resource intensive practices for finding out if someone is good for you or not. The digital reqruitment environments will do the work for you automatically.

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Skills comparison at Elance.com

And if this is not enough for you, throw in crowdsourcing. Outsource repetitive small tasks and even idea generation to an unknown group of people through the internet. Starbucks is using MyStarbucksIdea to generate new ideas on how to improve their services and products. Amazon not just outsources your servers and data, but also helps you with people in the machine with a service called Amazon Mechanical Turk, a name inspired by a legend of an ancient machine that could play chess. A finnish company called Microtask is working on something they call cloud labor. They promise to split work assignments into tiny tasks and distribute these around the world with automatic logistics and quality control.

Do you really have the option not to consider netforce in the cloud as a competitive advantage? If it’s not you who does this, one of your competitors might as well.