Why Facebook Isn’t Worried About Ello

I haven’t yet tried Ello, the newest social network to aspire to the role of “Facebook killer” (though my request for access is pending), but I know already that it is doomed to fail in that role. I’ve seen this scenario play out again and again, and result is a foregone conclusion.

Ello has attracted attention because of its pugnacious attitude expressed in a “manifesto” that begins, “Your social network is owned by advertisers” and ends “You are not a product.”

Some people are rooting for Ello to unseat Facebook by tapping into user rage over the giant social network’s controversial approach to using member information to sell advertising. They will be disappointed. Ello has no better chance of challenging Facebook than MySpace or Friendster. The social network wars are over, Facebook won and it’s time to move on.

My opinion is rooted in more than 30 years of watching battles play out over new platforms. Invariably the script is the same. To understand why Facebook has already won you have to understand the nature of technology platforms.

Platform Markets are Different

Platforms are technologies that serve as a foundation for development. Windows is a platform. So is the X86 chip architecture. Oracle is a platform and so are iOS and Google Maps. The winners in platform markets typically get 80% share, and everybody else fights over the scraps. This is because developers and customers want safe choices. They’re willing to pay more and accept less in exchange for knowing that a platform is going to be around for a while.

Platform winners are never supplanted by direct competitors. They fail for two main reasons: Customer preferences change or a new platform comes along that delivers a new kind of value.

An example of the first phenomenon is spreadsheets. In the late 1980s Lotus was larger than Microsoft and had a stranglehold on the highly profitable spreadsheet market with 1-2-3. Dozens of competitors took on Lotus with cheaper alternatives or modestly differentiated products. None gained more than a few percentage points of market share. What killed 1-2-3 was a change in preferences.Users preferred an integrated office suite based on a GUI metaphor. Microsoft had that and Lotus was slow to respond. (What’s sometimes forgotten is the Microsoft also discounted Office heavily in the early days, a strategy that helped tip the balance.)

An example of the second phenomenon is network operating systems. Novell’s NetWare reigned as the market leader until a good enough alternative came along in IP. IP wasn’t as elegant as NetWare, but it was free and accessible to all. Once it achieved critical mass, it became a safe choice and NetWare’s fate was sealed. Linux did the same thing to proprietary competitors on the server. Platform vendors are terrified by competitors that build critical mass.

Free doesn’t always supplant expensive. Linux on the desktop has never challenged Windows, but I think that’s due more to usability issues than price. On servers, Linux has done extremely well. It has critical mass.

Once platform companies become embedded they protect their franchise through a surround strategy. Some, like Microsoft and Intel, build formidable distribution networks and use volume discounts to block competition. Others, like Oracle and EMC, build software layers around their platforms that effectively embed them into customers’ organizations. Basically, it becomes more expensive for customers to switch than to stick with the incumbent.

What’s Really Different about Ello?

How does this relate to Ello? From what I’ve read, Ello uses the same basic social networking metaphors as Facebook and every other social network. Functionally, it’s a wash. Ello’s only major distinction is in the way it handles personal data.

The problem with that strategy is a few people really care. Privacy is important to a vocal minority, but in my view the vast majority of Facebook users couldn’t care less. As long as they can post photos of their kids and trash talk with their friends at no charge they’re happy. The recent disclosure that Facebook secretly manipulated the emotions of nearly 700,000 users has gotten plenty of media attention, but I don’t see anyone occupying Central Park over this issue. Facebook knows better than anyone that there are lines it shouldn’t cross.

What will ultimately unseat Facebook – or at least halt its growth – will be something that looks nothing like a social network. It may be based on sensors or artificial intelligence or free beer. No one knows. That’s one of the beauties of technology disruption. It comes from the craziest places. One thing is clear to me, however. It won’t come from Ello.

Stop Talking! I’m Trying to Listen!

Three years ago I routinely advised clients to spread their content around liberally through multiple channels as a way to reach the largest possible audience. I recommended setting up multiple Twitter accounts for different functions like customer service and marketing. And I advised linking generously to influential bloggers as a way of generating reciprocal links that build search visibility.

Today I would recommend none of those things. As social networks have grown, so has the amount of noise they generate. Spammers have corrupted the value of outbound links to much that some bloggers no longer even use them. The factors that once made social media so appealing – accessibility and openness – have become a liability.

What to Stop doing in Social Media_coverLast week David Spark launched an ebook that provides important updates on the social media practices that many of us have long taken for granted – but perhaps shouldn’t any more. Hazardous to Your Social Media Health (free with minimal registration) contains advice from Spark and 56 other veteran practitioners about 50 online behaviors that used to be cool but aren’t any more. One of my comments is included in the book, but that isn’t why I recommend it. I just think it serves a timely and valuable purpose.

Shhhhhh!

An overarching theme of the ebook is to shut up. The din of auto-posts and pointless comments about nothing in particular is drowning out valuable messages and undermining social media’s value, say several of the contributors. Democratic media is great, but when everyone is shouting at once you can’t hear anything.

David Spark

“This giant land grab of users was actually valuable when we weren’t so overwhelmed by social messaging,” Spark writes. “Now the influx is so overwhelming that we’re reliant on filters to manage the noise.”

For example, Leo Laporte (@leolaporte), who has nearly a half million Twitter followers, says he doesn’t even read his home Twitter feed anymore because it’s so clogged with useless messages. He now relies upon filtering and aggregation services like Flipboard and Nuzzle to sort through the noise.

The victim of too much noise is meaningful conversation. The opportunity to talk with constituents was the reason many brands went online in the first place, but it’s getting harder and harder to converse with an audience that’s overwhelmed with information.

Beyond Social Media

So maybe it’s time for the media to evolve beyond collaboration. Giovanni Rodriguez (@giorodriguez), CEO of SocialxDesign, suggests that the next evolution of social media will “enable people to do more, not just talk more.”

He’s referring to the emerging so-called collaborative economy, which uses social constructs to create value. Services like AirBNB and Uber either enable us to do things we couldn’t do before or make it faster/cheaper/easier to accomplish tasks. The collaborative economy is an exciting development. A couple of years ago we thought it was cool to consult our social network for advice on where to book a hotel. Now the members of our network have become the hotel.

Spark and his collaborators are particularly harsh on practices that contribute to the noise level without adding value or that have selfish objectives like raising the sender’s profile at someone else’s expense. Sections like, “Stop Blogging About Everything” and “Stop Lifecasting” drive home this point. In “Stop Sharing Without Consumption,” he scolds Guy Kawasaki by name for openly advocating the practice of sharing headlines without actually reading the content. He also tweaks the practice of content curation if it’s done simply to build one’s social profile on the back of others’ work. Much as I love Kawasaki’s Twitter style, I agree completely with Spark’s criticisms.

I don’t agree everything in Hazardous to Your Social Media Health, of course, including Stowe Boyd’s advice to stop using RSS readers and Charlene Li’s admonitions against personal blogging. Some of the listed behaviors are also duplicative or appear to have been added to stretch the list to 50, but that doesn’t change the fact that this is a useful, timely and practical how-to manual for the next stage of social media development. I guarantee that in five years much of it will be out of date, but it’s sure a useful document to read right now.

I’ve Been Writing A Lot Lately, Just Not Here

I only update this blog occasionally because most of my writing these days appears on other people’s websites. But my blog is still my home base. Here’s a round up of what I’ve been scribbling about elsewhere of later.

Social is the Future of Search (Profitecture Blog)

BuzzFeed HQ

(Photo credit: Scott Beale)

What could possibly unseat Google as the king of the Web? The answer might be incubating in fast-growing media operations like BuzzFeed (right) and Upworthy. These publishers eschew search optimization in favor of creating content that people want to share. From an SEO perspective, they do a lot of things wrong. And they’re killing it online at the moment.

Marketing’s big miss (BtoB magazine)

A new McKinsey & Co. report reveals a startling disconnect between B2B companies and their customers that should give every marketer pause to reflect on his or her priorities. The research shows that the themes that B2B companies emphasize in their marketing messages are wildly inconsistent with the factors that B2B buyers care about most.

Short on content? Repackage (BtoB magazine)

A lot of marketers are frustrated by the perceived need to turn out a lot of content, but the problem is much more manageable if you reuse and repackage creatively. Here are some ideas for how to get more mileage out of the stuff you already have.

Rewarding Bad Behavior (Godfrey Blog)

Marketing and sales organizations at most B2B companies have a relationship that can be politely described as strained. Sales complains that marketing gives them lousy leads while marketers charge that sales wouldn’t know a good lead is it bit them on the nose.

Both sides are correct. That’s because many organizations reward their sales and marketing people for the wrong things. Improve lead quality and a lot of the bad karma disappears.

Altimeter’s Brian Solis: ‘It’s the Customer Experience, Stupid’ (Huffington Post)

Brian Solis at Upload Lisboa, Portugal.

Brian Solis (right) is one of the most consistently provocative and perceptive analysts in the world of new media and social business. I caught up with him shortly before his Pivot conference in October to find out what’s on his mind. He believes few CEOs know how dramatically their businesses will change as a result of customer empowerment. And he thinks any business can enchant its customers. Even one that makes hammers.

Five Important Differences Between Paid and Earned Media (Profitecture Blog)

Many marketers treat social or “earned” media the same way they treat advertising and direct mail, but the two forms of media are very different. Earned media is more valuable because people volunteer to share your information. This benefits small and patient companies disproportionately. If you talk at customers in earned the channels the way you do in paid channels, your results will probably disappoint you.

 

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8 Data Points about the Importance of Customer Experience

I was asked to prepare some background information on the importance of delivering a positive customer experience, and I thought I would share some of the research with you.

How much does the market reward companies that deliver excellent customer experience? Consider that the Fortune list of the world’s 10 most admired companies in 2013 includes seven that are renowned for excellence in that area: Apple, Google, Amazon, Starbucks, Southwest, Disney and FedEx. The world’s two most valuable brands – Apple and Google – are considered world-class.

Recent research worth noting:

  1. Dell has published internal metrics showing that 97% of dissatisfied customers can be rescued with proactive intervention and more than 40% of those people actually become raving fans.
  2. Siegel+Gale’s 3rd annual Global Brand Simplicity Index reported last year that nearly 1/3 of American consumers would be willing to pay an average of about 4% more for simpler brand experiences.
  3. Gartner estimated last year that by 2014 “failure to respond via social channels can lead to up to a 15% increase in churn rate for existing customers.” You have to wonder why one-third of large corporations still block social network use by their employees.
  4. Research published by Temkin Group last year reported that only 7% of the 255 large companies it surveyed could be described as reaching the highest level of customer experience maturity, although nearly 60% said their goal is to be the industry leader in customer experience within three years. That’s gonna be a tall order.
  5. A July, 2013 Lloyd’s survey of 588 C-suite executives found that customer loss was their second biggest concern, exceeded only by worries about high tax rates. Respondents also indicated they are under-prepared to address this risk, with executives giving themselves only a 5.7 rating on a 1-to-10 scale (see chart below).Areas of Biggest Business Risk As Defined by CEOs
  6. Sixty-two percent of B2B and 42% of B2C customers purchased more after a good experience, while 66% and 52%, respectively, stopped making purchases after a bad experience, according to a recent survey of 1,000 people who had had recent customer service interactions. The research also indicated that customers are somewhat more likely to share bad experiences through social networks than good ones.
  7. Executives talk the talk but still don’t walk the walk. An Oracle survey of 1,342 senior-level executives from 18 countries earlier this year found that 97% agree that delivering a great customer experience is critical to business advantage and results, and that the average potential revenue loss from failing in this area is 20% of annual revenue.  However, 37% are just getting started with a formal customer experience initiative, and only 20% consider the state of their customer experience initiative to be advanced.
  8. A survey of 2,000 adults last year found that 83% are willing to spend more on a product or service if they feel a personal connection to the company. One-fifth said they would spend 50% more on companies that they felt the company put the customer first.

Not Dead Yet: Blogging’s Popularity Surges Among F500

There’s no fluff in the press release, so I’ll just excerpt it word for word. Nora Ganim Barnes and her team at the Charlton College of Business Center for Marketing Research at the University of Massachusetts Dartmouth continue to produce some of the most consistent, rigorous and comprehensive research on social media adoption by both small and large businesses. And they’ve been doing it every year since 2008, which makes the trending data particularly useful.

It’s no great surprise that this year’s report shows a broad-based increase in adoption of all types of social media. What is surprising is the sudden popularity of corporate blogs. After stagnating at just above 20% for three years, use of corporate blogs has shot up to 34% of the Fortune 500 in the last two years. That’s nearly a 50% increase.

This comes just as many of the digerati are writing off blogs as yesterday’s news. Maybe the technology isn’t very sexy, but the utility sure is. Blogs are search engine magnets and search is still the killer app for people researching purchases. It will be for a long time. Be careful of dismissing mature technology just because it isn’t cool any more. Did you know that e-mail still has a significantly higher conversion rate than any other B2B Web traffic source?

Read more and download the full report at “2013 Fortune 500 Are Bullish on Social Media.”

In the past year, the Fortune 500 have increased their adoption of blogging by 6%, their use of Twitter for corporate communications by 4% and their use of Facebook pages by 4%. Sixty-nine percent of the 2013 Fortune 500 use YouTube, an increase of 7% from 2012. These was among the key findings of the latest benchmarking study conducted by Dr. Nora Ganim Barnes, Ph.D., Senior Felow and Research Co-Chair of the Society for New Communications Research and Director of the Center for Marketing Research at the University of Massachusetts Dartmouth.

The new report is the outcome of a statistically sound study of the 2013 Fortune 500 list. The study examined these institutions to quantify their adoption of social media tools and technologies. This is the seventh year that Barnes has tracked social media usage by this sector, and it is the only statistically sound longitudinal study of its kind with every company in the Fortune 500 included. Key findings of this study include:

• In 2013, 171 companies (34%) had corporate blogs showing the largest increase in use of this tool since the 2008 study of the Fortune 500.

• Companies that blog include two of the top five corporations (WalMart and Exxon), leaving the other three (Chevron, Phillips 66 and Berkshire Hathaway) without a public-facing blog.

• Three hundred eighty-seven (77%) of the Fortune 500 have corporate Twitter accounts with a tweet in the past thirty days. This represents a 4% increase since 2012.

• Facebook, new to the Fortune 500 list, has the highest number of followers on Twitter, followed by Google, Starbucks, Whole Foods Market, Walt Disney, JetBlue Airways and Southwest Airlines.

• Three hundred forty-eight (70%) of the Fortune 500 are now on Facebook. This represents a 4% increase since 2012.

• In 2012 one hundred fifteen companies (23%) had neither a Twitter account nor a Facebook account. This year that number has dropped to eighty-four companies (17%).

• Approximately 40 companies of the Fortune 500 are now using Instagram, Pinterest and/or Foursquare.

Charts

Fortune 500 Corporations  With Public-Facing Blogs Slide1

Attack! Customers Skewer Golden Corral Over Sanitation Issues

The Golden Corral restaurant chain is getting pummeled over photos that were posted to Reddit showing the kitchen overflowing with unwashed dishes and garbage. The Reddit post has spark more than 2,000 comments already, with another 500 or so accumulating on the chain’s Facebook page.

The manager of the restaurant in Port Orange, FL called the incident “a result of the Associate Manager making a bad decision to improperly store food when the corporate inspector made a routine, unannounced visit to the restaurant. I apologize that a member of my management team made this bad decision.”

Judging by the comments on both Facebook and Reddit, apology not accepted.

Links if you want more:
Photos
Reddit discussion
Facebook post

Book Review: Tales From a Veteran Blogger

I’ve been a reader of Ed Brill’s blog for several years, not because of any particular  interest in the IBM/Lotus products that he long championed, but because he’s just so good at blogging.

Opting In by Ed BrillBrill was a longtime product manager for IBM’s Social Business products, where he fought an uphill and often public battle against Microsoft. Brill’s barbs were notable because IBM’s buttoned-down culture had historically discouraged direct public engagement. How did a product manager get away with poking a stick in the eye of a major competitor?

The fact that he did get away with it is one of the sub themes of Opting In, Brill’s new book about social product management. “Only twice did someone ask for me to be fired at the chairman’s level,” he jokes. That seems funny today, but at the time it was a bold test of new management principles that challenged IBM’s 100-year-old prohibitions against individual expression.

Brill’s engaging and readable book is aimed at product managers, those corporate jacks of all trades who fret about everything from market research to customer support. Product managers are the ones who ultimately take the credit or blame for a product’s performance in the marketplace, and Brill sees social media as their ally at almost every level. Opting In covers everything from Google Alerts to Pinterest, and Brill not only outlines the unique utility of each of these tools but usually provide stories to support his points.

Telling Stories

For me, the benchmark of an enjoyable business book is storytelling, and Opting In has stories aplenty. They include detailed accounts of some of his more notable confrontations, such as a 2004 dustup with the influential Radicati Group and a 2010 challenge to a controversial Gartner report. Conventional wisdom holds that you don’t pick fights with these influencers, but Brill went to war and lived to tell about it. The explanations of his reasoning behind these actions are valuable competitive intelligence for any product manager.

Ed_Brill

Ed Brill

Most of the tales in Opting In are more upbeat. For example, Brill tells how a single tweet on a trip to Sydney led to a meeting with a local follower and fellow foodie and a friendship that has lasted for years. Social media is about more than business, he emphasizes. Those glimpses into your experiences, hobbies and interests create touch points that lead to meaningful relationships.

Product managers will learn much from scrutinizing Brill’s insight on topics common to the profession. He introduces the concept of “progressive disclosure” as an alternative to the traditional Big Bang product announcement, with the idea being to use social media to build awareness and buzz leading up to the communication of the news.

He describes how Lotus has increasingly moved toward open product development as a way to integrate user feedback into the process and even shares a story about how his group handled an unforeseen customer backlash to some changes that everyone expected to be a hit. Fellow product managers will relate to all of this.

Opening Up

The hero of the book is IBM’s Social Computing Guidelines, which get a full appendix entry of their own. Brill frequently praises these rules, which are often cited as a model of social media policy, for giving him the courage to take on some of his more notable battles and to continually give voice to his opinions.

The guidelines, which were first drafted in 2005, have changed IBM fundamentally. To dramatize the scope of that change, Brill recalls how he was slapped down by corporate communications in 2003 for identifying an employee in a blog post because, “we don’t have celebrities at IBM.” Less than a decade later, IBM was running ads celebrating individual employees.

“The guidelines…signaled to employees, clients and the market that IBM would stand behind its [people],” he writes. In a day when corporate loyalty seems almost a quaint historical curiosity, the kind of faith must be pretty empowering.

Full disclosure: I have a consulting relationship with an IBM subcontractor.

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Slides and Video Cover What You Need to Know About Search

A client asked me to prepare a one-hour seminar on the basics of search engine optimization (SEO), and I thought it was worth sharing. This is more than your standard chalk talk. I pulled together slides from several presentations I’ve used over the last few years, updated them and wrote a complete script, which is included as slide notes in the in the PowerPoint. You can download the presentation and read the notes or watch the video.

I’m not an SEO expert by any stretch, but I’ve learned a lot by osmosis. For those who are mystified by Google magic, this deck will get you up to speed. If you’re already a guru, skip it and head to more advanced sites like Search Engine Land, SEOmoz, TopRank or Biznology.

Thanks to Mike Moran, HubSpot and McDougall Interactive for permitting me to steal from them.

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Small Firms Again Trump Enterprises in Social Media Use, UMass Study Reveals

The Center for Marketing Research at the University of Massachusetts Dartmouth is out with its latest survey of the Inc. 500’s use of social media, and once again small companies outpace large ones. Ninety-two percent of the Inc. 500 use at least one of the tools studied, which include blogs, Facebook, LinkedIn, YouTube, Pinterest and Foursquare.

Blog use by Inc. 500 and Fortune 500 companiesInterestingly, the use of blogs jumped among the Inc. 500 after four years of little or no groth. Forty-four percent of the 2012 Inc. 500 are blogging, compared to just 23% of the Fortune 500. The figure is a jump from the 37% of Inc. 500 companies that were blogging in 2011. Researchers Nora Ganim Barnes and Ava Lescault found that 63% of Inc. 500 CEOs contribute to blog content.

Also notable is the surge of interest in LinkedIn, which is being used by 81% of companies compared to 67% for Facebook and Twitter. Facebook was the big loser in this survey. Its usage dropped 7% from last year.  Up-and-comers are Foursquare (28%) and Pinterest (18%).

Growth in social media investment showed signs of slowing in this survey. Only 44% of respondents says they’re looking to spend more on social media, down from 71% in the 2011 survey. Forty-one percent say their level of investment will remain, up from 25% last year.

Sixty-two percent of respondents said social media is “very necessary or “somewhat necessary” to the growth of their company. This is the sixth year The Center for Marketing Research at UMass Dartmouth has conducted the study.

There’s lots more on the summary page, including links to downloads of the full results.

 

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Social Marketing Wisdom From a True Practitioner

Stand Out Social Marketing starts a little slow, but if you stick with it you’ll be rewarded with truly actionable insight that can help your whole company become more social.

Stand Out Social Marketing coverThis new book comes from Mike Lewis, who is head of marketing at Awareness Networks, a personal friend and one of the nicest guys I know. Stand Out builds on the premise that a great online presence is a function of distinctive content delivered through multiple channels with the assumption that interactions with constituents are part of the process. The book’s initial focus on social listening tactics is somewhat incongruous in that context, but it gets rolling as Lewis moves along.

There have been plenty of books about social media marketing written by people (like me) who don’t do much of it. What makes Stand Out such a stand out is that Lewis not only brings years of field experience to the topic but also insight gleaned from hundreds of customer experiences.

This book is worth its cover price for chapter 4 alone. In it, Lewis sets out practical guidelines for getting the most out of social media interactions based upon real data from real campaigns. Lewis has the benefit of being able to tap into the knowledge that huge brands like Major League Baseball have gained from analyzing millions of customer reactions, and some of the insights are fascinating. For example:

–People post more content to social channels on Friday than any other day of the week, but Thursdays have significantly higher interaction rates.

–Nearly 100% of interactions around content posted to Facebook and Twitter occurs during the first 10 days, but only 34% of interactions around YouTube and WordPress content happens during that time. This means that content posted to these channels should be created differently depending on when people are most likely to discover it.

–Content published to three or more social channels generates about 30% more engagement than content posted to a single social channel.

This is what I call really actionable information. It will immediately change some of your tactics – and for the better.

In addition to  statistics like these, Lewis offers practical advice buttressed by concrete examples. For example, “Content should be focused on the needs of your prospects and customers – not on you, your company or your product.” While experienced social marketers may think this advice is obvious, it’s stunning how few marketers think this way.

Stand Out also has several excellent case studies from both B2C and B2B businesses that dramatize the advantages of engaging in conversation rather than spewing messages. An accompanying website provides bonus information that builds on many of the points raised in the book.

A metrics section near the end introduces some new measurement tactics that were unfamiliar to me but which provide a solid foundation for understanding reach and effectiveness. It goes well beyond fans or followers to include factors like SEO effectiveness, interactions, activity and even customer service. These are useful ideas to internalize in making a comprehensive ROI evaluation.

It’s hard to think of a social media marketing angle that hasn’t already been covered by some other text. Mike Lewis manages to find one.

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