Pretzel Logic – Enterprise 2.0

Kunur Patel of Advertising Age covers a Forrester report that advises businesses to hang back on investing in location based social network marketing. The report says:

In a study out today, Forrester finds that only 4% of U.S. online adults have ever used location-based mobile apps such as Foursquare, Gowalla and Loopt. Only 1% update these services more than once per week. What’s more, 84% of respondents said they are not familiar with such apps, leaving the vast majority of Americans online still in the dark about location-based apps, which have had the marketing world obsessing over them in recent months.

I’m not a user of location based networks (a great primer by Marshall Kirkpatrick if your new to this topic). So far, I haven’t seen a personal use case emerge that compels me to stop what I’m doing and declare which restaurant, gym, amusement part I’m entering. And I’ll go as far as saying that when people auto publish their location on Twitter without adding meta data (i.e. something valuable/funny about what your doing at a location), it just clutters my tweet stream.

All that said, whilst the proof is in the quantitative data, I think the resulting recommendation in this report may be short sighted. The big value driver of location based networks such as Foursquare and Gowalla is geographic density. To each user, the breadth of the service and total number of subscribers matters relatively less. What’s more important is usage in each locale by both constituencies – my social network as well as local businesses. That makes it more interesting to the user as well as to businesses aspiring to open up new marketing channels via location based networks. San Francisco and New York seem to be hot. Airports at major cities also seem to be popular locations. Concerts and other events featuring well known performers again seem to be got. So it boils down to location and good old segmentation, like any other marketing program.

Take for instance, the restaurant or most hospitality based business. The big costs are generally fixed. You’ve already bought a days worth of perishable salmon, turned on all the ovens, and secured 8 waiters for the night shift, regardless of how many patrons show up. On the flip side, the good news is that you have a finite number of seats to fill up for each dinner service.

Most consumer tools in the restaurant business, notably OpenTable, are great as a central reservation nervous system but they do little to close the gap between capacity and demand, beyond the segment of customers that plan early. That’s where location based networks can come to the rescue by attracting new customers that happen to be in the area with deals or drive repeat visits based on loyalty. If I can get deals pushed to my phone as I enter University Avenue in Palo Alto at 6pm, there’s value there. For the restaurateur, it gets her closer to covering those every hefty fixed costs.

I get that ultimately, to scale up and improve offers, total number of users matters. But to suggest that most marketers should wait is a bit too categorical for me. I suspect macro marketing principles are being applied to what is an extremely hyper local marketing value proposition. A category of marketing that’s extremely difficult and expensive and one where location based networks offer a ray of hope. Big brands such as restaurants and retail that rely on local foot traffic could really use new approaches to attract customers. And for now performance based marketing offered by location based networks might well be the a promising, economically lucrative option.

Back to that restaurant example, if your brand participates in an area where there’s high geo graphic density of location based social network users and all you need is 200 warmed seats every night, suddenly, ‘only’ a few million users on these services looks like a goldmine.

Hat tip to David Armano for the link

Related articles by Zemanta

• The Ever-Present Debate Goes On: Is Location A Business Or Feature? (networksolutions.com)
• 3 Ways to Market Your Business on Foursquare (thesearchagents.com)
• App Lets You Know When Friends Are Nearby (technologyreview.in)
• Paul Frank and Element Tap Loopt for Location-Based Incentive Programs (mashable.com)

I’ve been buying computing hardware as a business customer from Dell for over 7 years now. All of our infrastructure technology as well as desktop equipment almost exclusively came from them. Servers, Printers, Laptops etc.

My experience, averaged out over this period with Dell has been a net positive. Their stuff works, the service and follow up has generally been good. A few issues such as a customer satisfaction calls at 6:30am (!?!), too many requests for equipment identification numbers after I’ve entered it into the touch tone system as I get volleyed from support rep to support rep. I can live with some of this as we don’t have reasons to call that often. And as a person, I’m generally not one to dwell unless you really get my goat.

Then a serious problem hit a few days ago where I really needed Dell to come through for me. My under-warranty hard drive was about to fail which would mean all my purchased software was about to be wiped out. So I asked Dell for replacement copies of software and the “its Microsoft’s problem” syndrome kicked in. So I went back and forth between these two ‘partners’ who’s reps had expert reasons for why the problem wasn’t theirs to solve.

During this, all I could think of is that the Dell has all the data concerning my purchase and loyalty history for seven straight years and yet, they wouldn’t budge to make this as simple as possible for me. When I mentioned to the these vendors that I have registered the software when I made the purchase (incase, the issue here was verification that I was the lawful owner), I was told, this information is captured only for future marketing purposes and that  customer support doesn’t get access to this data. Wait, my taking the time to register my software is to serve you and not me?

Please note my first comment: My experience with Dell is a net positive in spite of this. And as much as its unpopular in many circles to say you like Microsoft products, except for Vista, I really do like their stuff, personally. So this is not about these providers in particular.

The point is, CRM is a mess. Internal departments are not sharing my customer profile to appreciate my historical allegiance to the organization. OEM partners who had to collaborate to have the slightest chance at winning my business are not sharing data amongst themselves. Even when they know that keeping me as a long term customer is predicated on them both serving me equally well. As organizations, we just don’t have a handle on how to use what we already know about the customer.

As tempting it is to add to the chorus of many altruistic “CRM got it all wrong and Social CRM is here to reinvent customer interaction” or for that matter, “SCRM is strategy and not technology” (is it? or is it an execution path to established business strategy?) blog posts, Social CRM is going to accentuate the problems of CRM. The thing with SocialCRM is that it adds more customer data to CRM records when many organizations have not learnt how to act on existing data. Whist a quick look at my Twitter usage can give Dell an idea of my profile, what good will that do if organizations are not going to act on hard data they have today: How much I’ve spent with them over the years, my active registrations of software I’ve purchased, my loyalty based on the fact that I religiously buy new equipment from them every year.

So whilst we look at newly minted Gartner Magic Quadrants on Social CRM providers (Jive Software offers a copy here with registration), organizations need to understand how much house cleaning they need to do first. And unless that happens, SocialCRM only gives organizations a data migraine – more info that they don’t know what to do with.

Paul Greenberg, who sits at the pinnacle of the ‘whose who’ digerati when it comes to CRM and Social CRM has an excellent write up today about Gartner’s Magic Quadrant and the Gartner Event on Social CRM. A central point of this post is that whilst community and engagement are important and vendors to date have made solid progress, Social CRM integration with CRM to truly improve customer relationships is critical. And that nut has not been cracked yet. When the report was released a few days ago, I said to Mitch Lieberman, another SCRM thought leader on twitter:

“@mjayliebs those in the Gartner MQ #SCRM leader quadrant better have figured out lead gen in a meaningful, budget shifting way. think not”

My larger point (140 characters don’t often lend well to making larger points) was that this needs to move from community to supporting business tasks and an overall CRM initiative whether that is lead gen, or in my case, customer service and the like. In the case of my issue with Dell, everyone needed access to the same hard data (my company profile, purchase history), my probability of remaining a Dell/Microsoft customer based on my social graph , my in-warranty status on hardware and all OEM software (see that I was the legitimate owner of the software and simply wanted a replacement copy and only thanks to an in warranty failed hard drive).

We tend to think that using social media monitoring and listening systems reduces noise and lets us focus on things that matter in our customer relationships. I respectfully disagree. Until its surgically helping you execute business and process objectives more effectively, its still noise. Just squeaky clean. I asked Esteban Kolsky, a respected CRM analyst to chime in:

We have seen the positive effects that monitoring social media and acting on it in real time can have in an organization.  Even Dell, mentioned in this example, managed to earn some money in social media be leveraging real-time, social marketing.  However, that is not SCRM.  Social CRM is where the social data and the transactional data are analyzed together to create deeper insights that ever before.  Using Social data we can amplify what we know about customers by adding a sentimental, emotional layer to what we know — and that helps smart companies drive sales cycles and create better revenue models.  Are we there yet? not even close, we first need to figure out a way to integrate the socially-collected data with stored transactional data, then how to create better insights, and finally how to to act on them. Yes, it is a lot of work — but the rewards far surpass any amount of work you have to put into it.

Failing house cleaning on existing CRM design and decisive use of Social data as part of that revamp, we’ll just have glorified community forums that no doubt look far more sexier than forums of yore, but don’t mean much when it comes to tacking large scale operating and growth objectives of organizations.

It’s fascinating how we consider New Product Development /Research to be investments (by implication, a return can be had on these) on one hand, but we allocate marketing and customer acquisition as an expense. In plain English that translates to: We’re ok with considering what we design, build and sell, an asset that will yield returns. But not the effort it takes to serve prospects and customers that may be interested in what we purvey. Baffling, no?

Marketing has this almost comical, inverted model of inputs and outputs that defies Economics 101. A business typically buys inputs at wholesale and sells products at higher margin retail thereby seeking to make a profit. In contrast, marketing uses big picture estimates such as ‘customer lifetime value’ to estimate how much you can make from the average customer (output). But excluding branding, cost inputs to acquire prospects and sell more to customers are at hefty, mind boggling, retail costs – point advertising spots to sell a product, product launch emails, webinars, promotions, and recently, SEO/SEM campaigns. Hell, we financed Google’s insane success thanks to this model, if you think about it! 

Moving from Transactive vs Relationship Elasticity

I see customer acquisition model as a mindset of ‘transactive’ elasticity. In other words your spend goes only as far as supporting each transaction. So, your spending over and over again to sell new products to the same target customer. And that tactical design can’t be treated as anything but an expense. Conversely, investments are nurtured over time, are less susceptible to cuts in a down market, and yield results at intervals or in perpetuity. 

Contrast this with a model where you invest in relationships with your customers by engaging authentically with them in communities. These communities give the money you allocate to customer acquisition far more elasticity by spreading the wealth across the life of the relationship with relatively smaller spikes in expense that correlate with new product awareness. They center on investing in fostering and facilitating a dialogue with your customers, your partners and your prospects. Dialogues that far outlast single transactions. And via a platform to engage with them between transactions. Sounds like an investment and not an expense to me now.

This is articulated really well in, “CRM at the Speed of Light”, a must read by the terrific Paul Greenberg:

“Transaction is not the paramount artifact of the interaction. Instead a transaction becomes the side effect of rich relationships that are built on conversation. This notion is fundamental, and is a radical switch in priorities for the interaction between customer and vendor”

Edge Relationships Don’t Scale

Creating true relationship networks, whether on third party participatory networks (such as Facebook or Twitter) or on your own branded communities require a clearly defined approach, mindset and interaction design.

Umair Haque, Director of Havas Media Labs and blogger at Harvard Business Review wrote a superb post “The Efficient Community Hypothesis”  (that I recommend you read in full):

“People, truth, identity, reputation, values are the five elements of an efficient community”

I agree with that and they apply to communities that foster these relationships.

That said, community building often gets limited to efforts managed by the “social media expert” or the community manager. Its no doubt a first, extremely important step and herculean at that, (just ask Rachel Happe) but edge efforts don’t scale easily. And if the effort is superficial, they quickly start reeking of old school spam marketing (just see many of the groups on LinkedIn, for example, that sport the same old marketing pitches).

To be truly valuable, customers want to bypass marketers and get to those that have the highest quality information. The best information, void of spin or marketing speak, are in the minds of your other customers, your channel partners who may interact with customers more than you do, and your suppliers who know more about individual components that make up your product.

To enable such a design you need a collaborative design and enabling technology infrastructure that allows for the right minds to wrap around the customers needs. Marketing needs to broker and facilitate that, and then get out of the way. That’s the new customer acquisition design for the 21st century enterprise.

For a more in-depth overview of how to respond to this new customer dynamic and to move from a transactive model to a relationship model, take a look at a recent piece I published with Oliver Marks and TechWeb (email required).

Getting There

I’m not suggesting we stop advertising products when they launch. But do we have to buy marketing, over and over again at retail prices to sell that same customer time and again? Instead, why not invest (not expense) in more elastic relationships that defrays a good chunk of that retail cost?

Customer Acquisition seriously needs a new name to affect any institutional change in how organizations consider the actions and investment behind customer engagement. Customers never gave us permission to acquire them and it’s a bloody expensive to acquire them at retail, anyway. Tomorrows winning CMOs and Marketing leaders will be making a case for this to their CFOs and CEOs, today. I’ve been fortunate to work with some of these forward thinking folks. It’s not about big bang, it’s about etching away at it piece by piece and having it emerge, organically.

Here’s a screen shot of a Twitter search result for a blog post labeled “Four Reasons Why Enterprise 2.0 Communities Fail”

Over 60 Re-Tweets on Twitter as of April 19th resulting in god knows how many tens of thousands of impressions on Twitter. Yay for social media syndication.

There’s only one problem. That link hasn’t worked for three days.

So, basically, this link was never even clicked on before being re-tweeted.

Now these good intentioned folks may have well wanted to read the link later and I’m no one to judge how each of us as participants choose to use the medium. But if Re-Tweets are being considered an acknowledgment of quality content and subsequently relied upon as a metric by marketers, a Re-Tweet itself can clearly be a terrible measure.

I’m a huge advocate for social media engagement as an important component of marketing. It’s got mucho potential. That said, we complain about inaccurate open or click through rates with respect to email marketing but measuring the effectiveness and true reach of social media has a long long way to go as well.

So if a link drops on Twitter but there was nothing there to read, will it make a sound? You betcha. A really really loud, albeit hollow sound.

Hoping practical topics such as this come up at the 140 conference today.

Lots of strong reaction to Union Square Venture Partner Fred Wilsons comments about Twitter (his portfolio company) today.

On the issue of third party applications that leverage Twitters API, Fred commented that a lot of the apps today are filling holes in twitter instead of building substantive businesses.

Much of the early work on the Twitter Platform has been filling holes in the Twitter product. It is the kind of work General Computer was doing in Cambridge in the early 80s. Some of the most popular third party services on Twitter are like that. Mobile clients come to mind. Photo sharing services come to mind. URL shorteners come to mind. Search comes to mind. Twitter really should have had all of that when it launched or it should have built those services right into the Twitter experience.

The media jumped on it. In a post titled “Holy Cow Did Twitter’s Top Investor Drop A Bombshell On Twitter App-Makers Today”, Nicholas Carlson lays out some strong reaction from the Twitter App community.

But we talked to sources at a few Twitter apps, and one of them told us Fred’s message is loud and clear. This source heard, "[Twitter is] going to do mobile apps and URLs. [Twitter is] way playing down the role of other apps. [Twitter] desperately need somebody to do vertical/gaming stuff, since that’s what we aren’t going to do ourselves. Bit.ly (as a URL shortener), TwitPic (as a photo uploader) and Tweetie (as an iPhone app) are now considered ‘core’ to the platform. They will either be bought or competed with."

First, Twitter is infrastructure. And true to that mission, it supports the building of applications and services that sit above it. Over time, applications and services start to get commoditized and adopted widely across the ecosystem. At that point, features offered by these apps are considered infrastructure and as history has proven, get pulled into the core of the application. Phone companies provided phone lines and tele marketing businesses built a value add service on top of that. Similarly, utility companies provided juice that allowed us to go from analog to digital with many of our appliances. If you agree that Twitter is infrastructure, the same thing is happening here. Over time the economics change. AT&T now offers business services that sit on top of its phone lines. That’s natural evolution as the service gets commoditized and there’s wide appeal. The market expects it to come as part of the base package and the stability and assurances that come with such a move. And the same thing is happening here.

Second (and this did not come up in Fred’s comments), Twitters success to-date largely mirrors traditional media – its broadcast for a majority of the users. Not conversations or other kinds of synchronous activity that those of us in the early adopter community have embraced. Don’t know about you but I’ve lost count of the number of mainstream users that fully realize the value and promise of Twitter only after they use a third party client such as HootSuite or Tweetdeck. So unless your only interested in following celebrity tweets, engaging with users or discovering new users via Twitters native interface is nothing short of awful.

Twitter needs to fix that as its price of entry stuff. And so coming out with its own spiffy client is imperative. And there’s similar arguments to be made for URL shortners and mobile clients – both critical to engage in a 140 character constrained world. And critical to Twitter if its to be able to successfully haul the water in the long run.

So it may come of as a harsh warning, but it’s natural evolution.

UPDATE: And just two days after posting this, Twitter announces the purchase of Tweetie, a Twitter client built for the iPhone and the Mac. Marshall Kirkpatrick at ReadWriteWeb has some good analysis on this breaking story.

I don’t focus on product launches or ‘breaking news’ here on Pretzel Logic. I have a full plate on the work front.

The two exceptions when I not only cover but downright celebrate product innovation are:

• If I see traditional application or enterprise 2.0/social software vendors having the chutzpah to even attempt performance acceleration via the combination of process + social. You still need a strategy and plan but it makes execution a hell of a lot easier if the software is designed to account for context. See this on Chatter, for size.
• When enterprise 2.0 products take existing business functions in the enterprise and improve insight and diagnostics for managers to improve decision making and reduce business risk. See this on new opportunities that social software bring to improve Employee Performance Management.

That said, I’m fortunate to see plenty of demos and hear how the product does in fact accelerate organizational performance and why my readers or clients should care.

I’ve only recently taken to getting briefed by vendors but I spent many years in technology sourcing starting with my days as the practice lead of west coast tech strategy consulting group at marchFIRST (USWeb/CKS) and that continues until today. And our firm(s) remained retained through system deployment so we couldn’t skip town after presenting a vendor recommendation in a pretty PowerPoint to the customer. As a result, separating wheat from chaff when a vendor is presenting is second nature to me.

After sitting through presentations and demo after demo here’s one situation that I see over and over again. To the degree that you are doing this, I hope you consider this as constructive feedback. Here goes…

Stop raving about your product in the context of it’s last incarnation.

Over exuberant product managers, often weighed down by the baggage of the last version get very excited about why this version is better. And how it does so much that the previous version did not do. And quickly proceed to declare it as ‘game changing’.

If it’s game changing, it better be game changing in the context of:

• first, performance objectives that are keeping customers in your target market up at night
• second, the competitive landscape and installed base at the customer and in that context, how compelling your offering is to successfully overcome the switching cost of moving to your application. Hard cost as well as soft costs (culture & change management)

Your last release or update is already obsolete in technology years and for the most part, its a pretty weak baseline to benchmark against. Whilst its tempting and human nature to realize “how far you’ve come”, customers don’t buy based on that. They might appreciate the progress. But its not enough to cut the check. Same goes for influencers and analysts that can spread the word for you.

What’s ironic is that good product managers in fact start with market and competitive research to build a business case. Then move on to understanding how new features and capabilities change the existing release. But when they present and showcase, they forget all that hard work done to assess the opportunity and gaps in the market. And proceed to do a feature shoot out with their previous version.

After a decade of buying big ticket software and not necessarily seeing the ROI, buyers are more sensitive to ensuring stringent vendor evaluations than ever. This is one simple but very rectifiable measure. 

This post is not about what’s right and what’s wrong or whether we should or shouldn’t fight for using one or all of these concepts.  That said, each of these monikers need to be dealt with as they will become increasingly important as organizations begin to consider more efficient ways of interacting and transacting both on the social web as well as in the enterprise.

Here goes…

Transparent:

Transparent just got elevated to the top of the list. Most executives love the idea, just not the potential fall out that can come from transparency. As we saw with President Obama’s I’ll-broadcast-the-healthcare-debate-on-CSPAN unfulfilled promise, when you get into the politics at many large organizations, its as much about the lateral competition (in the case of the government, how the right and right wing media would interpret the open discussion) in the executive suite that worries more people about bringing transparency to their enterprises, as it is about top down / bottom up / emergent transparency.

Consider the recent fall out from Google Buzz. Personally I think its an excellent start to something very useful and promising. As I commented in a post by Alex Williams on  ReadWriteWeb:

The best thing about all of this for me is that Google has recognized and capitalized on the fact that email is the ultimate social network and they are aggregating- which is what they do best,” said Sameer Patel, a founding partner with the Sovos Group that consults about integrating social Web applications and collaborative technologies into the enterprise.

However, Google stepped on a banana peel when they misjuded the level of transparency that the general public would be ok with then it comes to sharing our email contacts.

Its clear that we as social networkers seem to be perfectly fine with transparency when its looking at someone else’s data and gestures. Just not when it comes to exposing our own.

Social <insert enterprise context here>

Clearly the most hotly debated moniker in the enterprise context. A President (not CIO) of one of the largest healthcare organizations that I met with threw me a new curveball a few weeks ago.  As prepared as I was to address the ‘Facebook is too social for us” argument with solid business context, the new one thrown my way was “my kids are leaving Facebook because of the new privacy concerns. If social networks are not good enough for them when all they do there is socialize, how can I bring this interaction metaphor to the office?”

Socialized <insert process context here> with the emphasis on business outcomes or activities seems to be far more palatable but to each his own.

Customer Community

Less contested depending on who you speak with. The problem is that the discussion around community and marketing is often short sold due to lack of depth and process knowledge around core marketing performance.  As I wrote a few months ago in a guest post:

Finally, with respect to marketing, most of the community focus today (especially B2B) is on brand awareness and engagement. Certainly, there’s value to be gained there, however, lead generation is the elephant in the room most don’t want to tackle or acknowledge. Regardless of the economic times, the closer your marketing activity is to generating revenue, the more strategic your program remains to your organization. That’s where customer communities need to go – fast.

Of course there are a few seasoned marketers that can take this on. Not to mention, community as an approach to effective awareness and engagement has benefit. But when it comes to community based marketing, few in the “social media consulting space” want to or even have the credentials to tackle the moolah question.

Second, very few are prepared to objectively say when Community is flat out the wrong approach to accelerating performance for your specific business objective. Here are 2 excellent posts by Gil Yehuda and Rachel Happe about not lazily intermingling different concepts that seem similar when in reality, are very different.

Real Time

Though I wrote a report on this topic, the idea of ‘real time’ is a meaningless discussion in and of itself without core performance context. Worse, it scares the living bejesus out of the seasoned CIO who still sport scars from the millions and millions sunk into integration to come anywhere close to near real time, a decade ago. It’s far cheaper and simpler now but real time for the sake of real time invokes instant eye rolling.

However, customers are intermingling in real time and they increasingly expect feedback in near real time. The reality is that the organization (not just support and marketing) need to have that infrastructure to be able to respond as fast as possible. That’s a very different approach than trying to rudderlessly tune the enterprise for real time and then chase/manufacture use cases to back fill value from the investment.

Enterprise 2.0

And finally, yes, Enterprise 2.0. I could leave you with a link to a Google Search Result to Dennis Hewlett’s Posts (its here by the way), but frankly, too often Enterprise 2.0 gets casted as a solution to a problem that doesn’t give the customer adequate heart burn to become a top priority. Until we see a Chief Sharing / Social / Email-sucks, Productivity Officer emerge (NOT!), lets focus on discrete objectives around leads, sales, innovation, product development and the like. It’s awesome to see a few vendors starting to come around to this in their marketing not just in the context of selling the benefit but also adoption and participation. See this excellent post by the very sharp Michael Idinopulos.

In closing, as I said above, I’m not hoping to start a war on whether we should or shouldn’t use this terms.  Transparency, social, open, relationships, collaborative IS the future of work.

If you have opinions on these or other monikers, chime away, below. But they need to know their place and the context.

Umberto Mellitti, CEO of on-demand sales intelligence provider InsideView, said on Twitter:

Umberto’s analogy is spot on. Also, if you’re worried about your Sales folks getting distracted by Social Media tools such as Twitter, sorry, but you have bigger problems. Either your compensation structure is just not juicy enough to keep them focused or I’m afraid, you got the B team. Or maybe marketing isn’t filling up the funnel effectively with qualified leads from Social Media channels.

My ex-colleague from marchFIRST Margaret Francis (now killing it at the awesome ScoutLabs) responded:

If your sales team is going to goof off, Social Media hardly presents the first opportunity to do so. There’s over 300 channels on cable TV, Golf Courses, Hulu and if all else fails, Vegas.

In the course of my work, I’ve conducted user needs assessments with well over 200 sales reps and sales managers at large organizations and it takes under 3 minutes to spot the ones that have “time is money” ingrained in their DNA. They have a nose for islands of opportunity and know how to use it effectively, always keeping the goal in sight.

I’d argue there’s ridiculous amounts of un tapped sales opportunity hidden in social media, and the good sales reps are figuring it out. And it’s time to fold in lead generation and revenue as outputs from Social Media, beyond awareness and engagement.

What a Good Sales Rep Would Never Do

I can’t imagine any good sales rep actively scouring Twitter for leads at the expense of traditional prospecting, especially in the B2B area. Sure, set up some persistent searches and if something juicy shows up, engage. But beyond that, carpet bombing Twitter or actively following (by following I mean reading) thousands of people to see if someone pops is obviously a waste of time. And the good ones know it.

Where Social Media Makes Sense for Sales

Social media for Selling pays huge dividends 1) as a lead qualifier and 2) as an engagement platform, after you have established a requisite qualification level.  Start with a qualified list from your existing funnel and using Social Media to connect, network, nurture and enrichen your prospect intelligence, as you begin the close.

Social Media rock god Chris Brogan has some good advice here.  After marketing has created awareness and surfaces leads, selling can commence:

So now you’ve put someone into your lead cycle. You’ve decided you are going to close them for a sale (and remember, let’s use “sale” loosely. Maybe you’re “selling them” on donating to your charity, or watching your video channel. The advent of services like Twitter allow you to mind read from afar. If I’m going to hit up Len Devanna from EMC to sponsor a conference of mine, I’m sure as hell going to read his Twitter stream from the last two days and make sure his dog hasn’t gone into the hospital or that he’s not dealing with a budget cut, etc.  It also allows you to gently touch (without selling) your clients so that they keep you top of mind.

Mark Hausman of the Strategic Communications Group also lays out a good approach, though focused more on how Marketing can use a Sales reps time more effectively:

• Step 1 Prioritize the Hot Ones. By working closely with your sales team, a set of prospects can be culled based on their standing in the sales pipeline, intimacy of existing relationship and potential size of the transaction.
• Step 2 Map and Monitor. Compile an overview of each prospect’s [Social Media] engagement
• Step 3 Engage in a Prospect’s Communities of Choice.
• Step 4 Evaluate. Get Sales reps to give you feedback on how social media has helped move these deals forward.

There’s some basic tenants of what defines the work model of a killer sales rep. These hold true for the use of both internal sales operational data as well as prospecting insight. The simple fact is that the availability of data or any other potential distraction such as Social Media will never, ever, come in the way of a good sales rep making his or her numbers.

Of course, there’s always another perspective on all of this, best characterized by Conan O’Brien:

“In the year 3000, YouTube, Twitter, Facebook will merge to form one super time-wasting site called YouTwitFace.”

Happy Friday

Earlier this week, I did a Q&A with the folks at Helpstream on the need and importance of customer communities to the enterprise.

We covered the following topics:

• the importance of building customer communities as part of an Enterprise 2.0 design 
• the role of a community manager and skills
• which functional areas will get the most value from communities in the enterprise
• important questions you need to think about when building a community
• have we reached the ‘social tipping point’ wrt the need for a community

Here’s an except:

Helpstream: What’s your general feeling on the importance of building customer communities for companies today?

Me: A customer community is one of the more promising components of the emerging enterprise design that’s powered by social computing technology. In a world before online communities existed, insight into customer intent and sentiment was limited to the few people on the organizational front lines. In contrast, most community initiatives today offer an open format that enables everyone in the organization to see what customers expect from you. But that only signals the very beginning of the promise of the open enterprise. Eventually the best minds across your organizations’ supply chain, employee and customer base, and distribution partners will be able to truly rally around the needs of your prospects and customers – often in real time, to accelerate business performance. A critical initial step to realizing such a work model is a well-conceived customer community.

The rest of the Q&A is over on the Helpstream blog, here.

Thanks to the folks at Helpstream for reaching out.

Last week, I had the opportunity to review a draft of The Guide to Online Community Management, published by the ReadWriteWeb team and edited by Marshall Kirkpatrick. Simply put, if you’re planning or considering a community effort at your organization, this is a must have. The report provides answers to any “ifs, ands & buts” with regard to the strategic importance of community engagement.

Most readers of this blog come from larger organizations. I’ve kept that audience in mind when reviewing this report.

Overall Impressions

To be honest, about 15% into the report, I struggled with the idea of buying a premium report that was largely peppered with quotes from articles that I’ve read before. However, as I kept reading, it became clear that report does a great job of identifying major trends, challenges and opportunities emanating from specific community efforts, backed by rich and sometimes opposing expert opinion. What you end up with is a set of succinct recommendations that organizations can consider and evaluate in the context of their own business objectives.  Should you publish a blog? Should you invest in a Facebook or a Twitter presence? Should you hire a full time or part time community manager? How to guarantee that your community efforts will fail? The pros and cons are nicely laid out for you, complete with real word experiences from practitioners, consultants and vendors. All of this to help with not just planning, but also practical execution.

On to specific areas that really resonated with me…..

Addressing ROI – Head On

I was quite surprised to see so many consultants and vendors either advise against quantifiable return or set a tragically low bar for success measurement. Thankfully, the unrelenting focus on ROI in this report clearly shows how community based engagement can be justified at large organizations. Ultimately, in my opinion, it boils down to whether you have the tenacity to attach the value of community management to specific business activity or not. What the report does well is to contrast and highlight examples of both approaches that enterprises can learn from and apply accordingly. Citing scores of case studies from companies such as Zappos, Dell, and WholeFoods, enterprises should be able to quickly identify what types of community efforts make sense for their business, and market place in general.

“The Morning After”

Since a good chunk of my work centers on execution planning, I was especially thrilled to see a sub section within the ROI discussion that was devoted to life after launch. As important, stakeholder expectations that need to be set with respect to ongoing operational requirements, changes in the customer engagement dynamics and new opportunities that emerge from maintaining a thriving community. For instance, on the issue of getting disillusioned because only a fraction of registered users regularly interact, Rubicon Consulting Principal, Michael Mace advises:

Managing a community is hard work and labor intensive. The report cites detailed case studies on how to beat the odds. For instance, Ex-Microsoft SharePoint Manager, Lawrence Liu (now at Telligent Systems) realized that the cost per incident was 90% lower when it was dealt with in the community forum as opposed to commercial phone support. With that in hand, he goes on to illustrate how he leveraged his success with the enthusiast community to create a business case for more dedicated in-house community support:

In terms of execution, the report also details useful how-to’s on topics such as hiring rock star community managers, establishing required resource commitments to ensure community health and sharing insights with relevant constituencies in the organization about what prospect and users want. Some of this is probably after-the-fact ROI, since you don’t know what direction the discussion will take until its’ had some time to gestate. The take away is that that once you get started, your list of benefits and value proposition for the community can continue to grow, beyond what you initially planned for.

Ancillary benefits that Community Managers can deliver across the organization

Beyond ROI that’s tied to the intended use case, the report discusses how other departments can gain from community efforts such as customer led innovation, recruiting, and awareness and research in the areas of marketing. Forrester Research Social Media Analyst Jeremiah Owyang says:

There’s some valuable discussion about how to generate leads in the context of B2B from community efforts, but this is an area where I believe that the report could have challenged interviewees even more. You’ll see some great examples at the end of the report about how sales reps engage on Twitter and surface qualified leads through conversations. But are two hours on Twitter more productive than say 5 qualified cold calls? Maybe; maybe not.

The end game

Overall, the only major component that’s missing for me is a deeper view into what a community managers’ career (and the programs they create) can look like in years to come. As new paradigm shifts in how to accelerate business performance emerge, there’s usually 3 phases to deliver lasting value:

Experiment > Operationalize > Institutionalize

This report has the first 2 phases covered. Experimentation is self explanatory and the report showcases some very effective emergent models. Operationalizing involves setting up a central command post that can incubate and manage these new work models as they bloom (much like what Dell has achieved, also covered in the report). Finally, institutionalizing requires that you get off the side lines, go to where process-laden, structured activities live, and improve, integrate with or take–out these inefficient forms of working. That’s where it can get truly transformational, towards an Enterprise 2.0 design. Business process management via ERP achieved this at larger organizations. In contrast, knowledge management largely failed at infiltrating each business activity and becoming institutionalized. How will the community function turn out and what are the risks that may cause it to fizzle? The good news is that we are beginning to see DNA-changing progress, primarily in the area of community based support. Helpstream is one company that’s leading the charge on this.

From a career standpoint I’ve always felt that today’s brightest community manager’s will not grow into VPs/CXO of Community or Social Media, etc. Rather, the very best ones will actually take over as leaders in charge of primary business functions such as Brand, Marketing, Customer Support etc. The catalyst will be successfully making relationships (not process) central to driving awareness, innovation, lead generation, support, and the like. This report confirms that hypothesis.

All that said, what the ReadWriteWeb team has done is brilliantly articulate how you can start and operationalize vibrant communities. And that’s what most enterprises are pondering, today.

The RWW Community Management Aggregator

Finally, this report is like the gift that keeps on giving. To respond to the dynamic nature of best practices as well as technology innovation, this report comes with a portal called the “The RWW Community Management Aggregator”. This important utility will keep subscribers up to date on the latest news, thought leaders and case studies in this space to make sure you are listening in the right places.

I fully expect that in the near future, this news aggregator will begin to surface insight into how to institutionalize community engagement in the context of specific lines of business activity.

Congratulations to the folks at RWW. Get a taste or buy the report here.

More reviews on the report here:

Jason Falls: ReadWriteWeb’s Guide To Online Community Management A Must Have For Businesses

Dawn Foster: ReadWriteWeb Guide to Online Community Management

Beth Canter:  Newsmastering for Professional Development 2.0 Dashboard