Tag Archives: LinkedIn

Outposting & Irrational Exuberance

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Staking a parcel of land in a new digital space is easy. It can lead to big sexy headlines and snap-judgement misassumptions.

Mashable wasted no time last week noting that Google+ has ‘signed up 13% of the U.S. population‘ and could be larger than LinkedIn or Twitter within a year.

Exciting news to be sure. And in some ways, given Google’s reach with its search service, etc. not surprising. I question the prediction though. Via an admittedly unscientific survey across my own Google+ circles I see a lot of outposting going on.

I define outposting as the rushing out to stake a claim to a new site or service online without intention to actively engage with it immediately. Outposting is done to reserve our account name. To be seen there. And to take a peek to see what all the noise is about. The rewards for outposting are well known. Having your name locked up – especially if its John Smith or similar – has a certain first-mover cache and is good for those concerned with their personal brand. Outposting is also a little like investing a small amount in a stock on the chance it gets big someday. Plus, as with many things online, the actual investment made in outposting is pretty small – about 10 minutes of your time – so why wouldn’t you?

I’d casually estimate that 20-25% of the people in my circles on G+ haven’t posted anything yet beyond the bare minimum profile and maybe a test quip or two. Additionally, the vast majority of people who have posted regularly work in media, marketing or technology or are otherwise of your typical early adopter profile. This is fine, and niching in natural in a fragmented media environment, but it should cast a certain light on stats like “G+ could be larger than LinkedIn by next year”. G+ might give Twitter a run for its money – it’s currently appealing to the same market segment – but when I think of all the kinds of people I know on LinkedIn vs. G+, Google still has some distance to go before it has proven its appeal to the broader LinkedIn segment. (The utility of Google+ competing with LinkedIn is also highly suspect at this point.)

Outposting reminds me of the Oklahoma land run scene from the Tom Cruise film Far And Away
(I found the clip and inserted it below) where they rush out onto the frontier and jam a flag in a piece of land. In the film, it was literally a dash to stick a flag in a parcel of land surrounded by equally open, full-of-potential, land. As anyone who follows history knows, some of that land grew to become towns and eventually cities. Some became farmland. And some never became anything at all. It had something to do with the land itself, but more to do with what was being done on neighboring plots around any specific parcel.

That last part is important because the eventual settling and development of G+ will work in a similar way. What the settlers around us do with their piece will largely define if the piece we staked out will be useful and valuable to us.

I am guessing that behind Google+ rapid signup rate, there is a lot of outposting going on. Who wouldn’t take 10 minutes to claim their parcel of this brave new world? The question remains how many of these people will be true frontier settlers willing to pull up stakes and move their stuff from the comfort of Facebook or LinkedIn or wherever to the open frontier of G+.

Then again, maybe it won’t be an either/or but rather like having a summer cottage you visit occasionally. (I realize I am stretching the analogy here.) Many of us already have multiple accounts on multiple sites and visit each for different reasons. This is all well and good, but one place is always our primary residence and as anyone with summer property knows, maintenance of the place you don’t go to frequently can be difficult to keep consistently. And if maintenance drops the face of neighborhood starts to change. Timely updates are the fresh paint and manicuring of Internet land ownership. (Wow, I am beating this analogy to death aren’t I?)

It’s worthing pausing now to consider Twitter as there are some parallels. According to Edison Research, Twitter enjoys 92% awareness among Americans. This is not surprising given that the little blue bird appears on everything from T-shirts to billboards and on the vast majority of websites. However, despite this awareness, which is nearly equal to Facebook’s, regular users of Twitter represent just 11% of the population. A far cry from Facebook’s nearly half of our population.

Twitter’s rocketing growth made headlines just as G+ is today. Publishers spoke of ’100% growth rates’etc. without detailing the circumstances surrounding those statistics. As it turns out, 22.5% of Twitter users publish 90% of tweets and only 21% of registered users are actually active on the site. (Think about that… 22.5% of 21% represent 90% of all Tweets. That’s the 80-20 rule on steroids.) So while a ’100% growth rate’is a great stat for headlines, there’s a lot of outposting hidden in there as well as simple old-fashioned account abandonment and user atrophy.

Google+, at this point seems to be echoing Twitter’s general trajectory just as Foursquare did a few years ago. Admittedly, G+ probably has higher odds of pulling in more of the masses if only because more of the masses use Google tools and brand awareness and trust is very high. No one needs to learn what Google is or stands for. We all have our idea.

(Playing devil’s advocate though, even with 92% awareness, Twitter hasn’t demonstrated enough utility to enough people to enjoy higher usage.)

Lest I sound like a buzzkill, it’s worth noting here too that having 11% of the U.S. population active on your site (as Twitter does) is not shabby at all. In my opinion its not quite enough market share to warrant the lofty Wall St. valuations, but then again, Wall St. has had a bad week so I’ll be nice to them for now. Instead, 11% marketshare is sort of the equivalent of being one of the ‘big four’networks of our time – though with Twitter that network is more akin to the Syfy channel and E! combining audience than a general household demographic. (Also, its worth stating here that the dynamics of social networking tools are so different from TV networks that the comparison and utility of being the equivalent of a ‘big four network’basically ends with the simple quantitative similarity).

I guess my big point here is that I think we working in media, marketing and communications need to check ourselves against irrational exuberance associated with outposting. Outposting is a well-established phenomenon that drives great headline writing and creates really impressive growth charts in meetings. It is not, though, a guarantee of future returns.

Funny, that last sentence sounded like the disclaimer that shows up on financial statements. And finance, as witnessed by this week’s remarkable stock market plunge, is another category full of hyperbole and ‘surprising’disappointments.

Interesting.

People with low Klout are highly important.

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I recently joined Klout (I’m usually a few paces behind the real early adopters… intentionally) to see what it was all about. I entered my Facebook, Twitter, LinkedIn and this blog. I came back as a ‘specialist’with a supposedly strong core network. That’s all well and good. The more interesting thing happened when I looked at my Facebook friends’Klout scores. Overwhelmingly they are in the single digits. Klout gives these folks feel-good titles like ‘Explorer’but the real title is ‘marginal participant’.

By way of context for why this is important, I go to some lengths to keep my Facebook network focused on real-life friends while LinkedIn and Twitter are more professionally bent. This is both in terms of the content I share through these channels and the friends/followers/connections I seek out. In this sense, my Facebook friend set crosses all walks of life and does not index heavy for tech/social/net types (unlike my Twitter account which is stuffed with them because of the nature of Twitter and the type of people attracted to it – you know who you are you self-promoters you!).

So while this exercise is a far cry from a scientific sampling, when my Facebook friends consistently come back with very low Klout scores, it does make me wonder if the divide between the tech/social/net types who build these various applications and tools and the average users they think might adopt them, isn’t more significant than sometimes assumed. To look at Klout’s site, online influence is something really important to measure. Influencers are certainly desirable to advertisers. Most people, though, probably don’t care about Klout or clout or being or knowing an influencer.

(I also question the very methodology used for measuring influence online, but that’s a whole other post.)

I’ve observed a similar gap with the pervasiveness of the iPad. Taking a commuter train into NYC, it seems about one in ten people now have iPads. However, when I was in Washington D.C. a few weeks ago, I saw only a handful as is often the case when I’m traveling elsewhere. I don’t question that people are buying them – the sales figures are what they are – but I think opinions of market growth based on observing people in the metro NYC area are somewhat skewed by that rather unique and novelty-obsessed niche.

In my opinion the one recent social media rising star that has most successfully made the leap out of the echo chamber  of the tech/social/net set and become a tool for everyone is Groupon. It’s worth noting here now that Groupon isn’t really about ‘connecting’the way Klout, Facebook, Twitter, LinkedIn, Tumblr, Posterous, et. al. all circle around that word either enabling it or measuring it.

Groupon instead offers something useful that people want – savings. That’s interesting. It might be that the next wave of successful business influenced by social-technology won’t see the technology as the ends itself, but rather the means to offer something lots of people find useful. Like coupons.

Meanwhile the tech sector keeps cranking out new ways for us to connect online. My big question is, how dissatisfied are most people with what they already have? I know early adopters need a constant novelty fix, but I don’t get the sense my low-Klout Facebook friends have too many gripes with what they have. Sure, people will be curious and sign-up – there’s a low barrier to entry for these things – but will they stick around and use it? That’s the big question.

And now of course there’s the hullabaloo around Google+ to look into. Yup, yet another account. Right now, given that Google has said upfront that the invites went out to people with ‘strong social graphs’I’m not surprised to find it full of my usual industry peers (nice to see you again at yet another URL folks!). The big question is, will those low-Klout friends of mine find it worth either moving camp from Facebook to Google+ or be willing to manage both sites? Either avenue is a lot of work. The big draw of Google+ is the ability to create overlapping friend sets for sharing. That may well be a useful app, but if it turns out to be valuable to average folks, can’t Facebook just replicate it? Technological advantage is very, very short lived these days. If I’ve already set up shop on Facebook, I can’t see pulling up stakes for that feature set alone. What, and wait for all my friends to join? And port over all those pictures and notes? And what about my Farmville (which while technies may despise it, is popular among many people)?

For me, the real test Google+ and others is whether my friends with the lousy Klout scores bother to not just sign up but to regularly participate – like they do on Facebook. Attracting social media fanboys is easy. We’re early adopters who are willing to tolerate having all these accounts and constantly switching from one technology to another.

The people with no Klout (and who, frankly, don’t care about having clout online) are the other 99%+ of the population that Facebook and Groupon continue to grab and largely satisfy as far as I can see. It’s these folks, characterized by low numbers of friends, low numbers of comments, low numbers of posts and low Klout scores, that set the high bar for being the next game-changing player in the space.

Groupon seems to get this. I’m not so sure some of the other ventures popping up do.

Social Media & The Persuasion Paradox

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When you boil it down, the premise of social-media-as-marketing-tool is the belief that individuals – be they friends or just fellow consumers – are a powerful persuasive force in purchase decisions. As such, many manufacturers are working to figure out how to leverage the inherent strength of human-to-human persuasion, through social technologies,  to sell their wares.

In the world of marketing, products are sometimes classified along a continuum. On the far left are ‘impulse items’– those inexpensive purchases which are bought almost purely on emotional whim. Retailers often allocate space near the register for impulse items.  They are purchases which don’t involve much hemming and hawing. Most people find a beer, soap, pen, detergent, etc. that they like and just toss it in the cart.

The purchase decision continuum

Click the image if you'd like to see it closer up.

On the other end of the spectrum are ‘considered purchases’. These are those expensive items for which a blend of emotional and rational thinking goes into the decision making process. That the process is longer goes without saying. It often includes getting feedback and reviews, comparing products and offers, and doing some research. The far extreme of considered purchases might be a house for example. However cars, motorcycles, computers, consumer electronics, etc. often fall into that category.

Ultimately each individual’s disposable income dictates where a specific product type lands on this continuum. For some affluent people an Apple iPad may be an impulse item. For those of more modest means, choosing between name brand and store brand detergents might be as much a rational choice based on price or dollar/volume ratio as anything. There are also fluke categories like haute couture apparel. For some people a $250 T-shirt is a must-have emotional purchase. (Though for me that’s just purely insane.)

Keeping this continuum in mind, think about those products which inspire the most fanaticism. I am referring to products where people argue passionately about their brand nearly the way people argue about politics. Apple. Mini. Porsche. Harley. These are brands that have user groups and communities, forums and dedicated club events. They also tend to be higher pricetag items which by their very nature tend to be more considered purchases. You may look to a friend for their opinion on a new car but its also expected you’ll read a brochure or two, check out a website, maybe consult a 3rd party like Consumer Reports or the Kelly Blue Book, look at the specs and maybe even take a test drive before plunking down a downpayment.

Switching gears, consider the brands you’re most likely to ‘give a shot’and buy on a whim based on a someone’s recommendation alone. Beer or soda. A restaurant. A movie ticket, book or DVD. Many of the top-of-mind try-it-based-on-the-recommendation-only products are at the impulse end of the spectrum. They don’t cost much therefore there isn’t much to lose even if you don’t like them. Coupled with a friend’s recommendation they’re a low-risk proposition and a snap purchase decision.

Do you see something of a paradox forming? I do.

Click the image if you'd like to see it closer up.

On the one hand, the types of products people feel most passionate about tend to be those products which are accompanied by a considered purchase decision making process. I would even say part of the reason people feel so passionately about them is that they’ve invested in the brand both emotionally and financially. These pricier, considered purchase, passion-igniting products play strongly into the social media sweetspot. People like to invest the energy into talking about them. Social media is good at letting people talk about them. (See the red line in the diagram above.)

The only hitch is, human-to-human persuasion, that is recommendations of friends and fellow consumers, plays a proportionally smaller role in the overall purchase decision than it does on the other end of the spectrum. (See the orange field in the diagram above.)

Which brings us to the other end of the continuum. Here the low-cost, emotionally-bought products like beer, soda, pens and detergent, are simply not all that interesting to talk about in any depth. Few people are willing to invest too much energy into discussing the finer point of bleach in stain removal. Yet these are the very types of products for whom a recommendation by a friend probably holds lot of weight in the overall purchase decision.

Therein lies the conundrum. Those products which enjoy a higher likelihood of being bought purely on the peer-to-peer chatter are exactly the types of products few people feel inclined to chatter about. Meanwhile those products that people do chatter about need the support of a strong, fully integrated campaign of materials and touchpoints – which include but does not overly rely upon social media – if they are to ring the register. Why? Because peer-to-peer is not enough to complete the transaction. It’s a contributor but not the driver.

Then there is of course awareness, the achilles heel of social media because aside from the very rare, often silly, viral videos where the brand is often an after-thought of the execution social media simply cannot build awareness as broadly and quickly as mass media used to. That may be a moot point to the degree mass media are a thing of history, but nonetheless, social media doesn’t do awareness well or quickly by comparison.

Yet awareness is very important, without awareness no one knows your product exists to even recommend (on either end of the spectrum).

I will acknowledge here that there are inevitably a handful of brands which are both lower-cost/impulse-like in their purchase mechanics and also high-passion buzz-generating in their appeal. These are a lucky few that can count on social media buzz to deliver significant sales. However, most brands face a more complex situation for which consideration along the purchase continuum and comparison to the proportional strength of social media in driving purchase along that continuum is critically important.

But – and I am saving the most important bit for last – where your brand sits on the continuum isn’t really the important fact because frankly its not a point but a variable. What matters is where your customer’s financial wherewithal plots your product on their continuum. This will change from segment to segment and requires a different mix of media and tactics for each segment.

As my business partner says, “Speak to everyone with one voice and you speak to no one.” Sounds like Marketing 101on the surface, but given the number of marketing conversations that start with, “This technology allows us to do…” I would say the industry is still poorly oriented to the important driver of decision making and persuasion – the world view of the consumer and the steps, media, and validation points they use to make a purchase decision.

Of Communities and Customers

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I own a Jeep. To some marketing guy, I'm part of the Jeep community. And while some few Jeep freaks will buy Jeep-branded anything, most Jeep drivers don't. They don't see Jeep as a community or lifestyle, they see it as a product that fits into a lifestyle which includes many products.

Today every company is in the throes of putting together a ‘social media strategy.’Per usual, the promises of marketing gold lie over the rainbow. And as with the dotcom bubble, new job titles like Community Manager or Curator are being minted alongside vague responsibilities whose performance metrics are rooted at the far-squishy end of qualitative measures. The lexicon of social media is changing the vernacular of marketing in other ways too. Advertising and marketing used to be about ‘targeting’customers through ‘campaigns’. Military metaphors were plentiful. Today ‘customers’are so 20th century. What companies need today – or so the thinking goes – is a community. Communities sound like everything customers rarely were – caring, committed, friendly, and most of all loyal. The language of marketing has changed too. We’ve moved away from military terms to softer, gentler, flower-power terms like sharing, communal knowledge, and crowdsourcing. Tune in, turn on, drop out dude, it’s the age of Aquarius 2.0. It all feels so good, so new, so different.

Here’s the headline: For 99.9% of companies out there; if the only thing the people you’re courting have in common is your product, they’re your customers not your community.

Sure, there are the very, very rare but very, very hyped exceptions – Apple comes to mind. Everyone being like Apple is like every actor in L.A. being a star. While you’re waiting for your audition make me a latte.

In most categories  - from fashion to food – people don’t consider themselves part of a product-based community. Do you really belong to the DKNY community? Do you belong the the Whole Foods community? Are you a member of the GAP community? The Sony or Netflix community?

Just because people post comments on your products or pass coupons around or give you four-stars… that doesn’t make them a community advocate. It makes them an opinionated customer with friends. The kind companies had back in 1980 too – only now said customer has a soapbox to stand on and friends are a click away. Sure people will ‘fan’a Facebook page or follow your Twitter feed. That’s one lazy, easy click. The barrier is low. The cost is free. And for the marketer counting these people as their community, the same rule applies – you get what you pay for.

‘Liking’something isn’t the basis for a community. Customers have talked about what they liked – from Levis to Duran Duran to the Rubik’s Cube – for decades. Again, now they have a soapbox. This isn’t to say there’s no utility to the marketer among these outspoken customers, there is. Its just that someone rating a few stars on your product page is not the same as a frothing brand evangelist at the pulpit of an engaged, evangelical, branded community.

So if communities form the core of the social web concept (we can’t be social without some mechanism in place), shouldn’t we have a better definition of an online ‘community’than ‘users of product X who have participated in a blog/forum/Facebook page/retweet/insert-whatever-social-media-metric here’?

I would offer that communities online are linked by passionate interests. That might be music or art or clothing or movies or baking. It might be a fascination with astronomy or gardening. It may even be political. The show-up-at-rallies Republicans and Democrats certainly could be characterized as communities. The thing is, most products just don’t create that kind of passion for most people. They can’t, they’re products.

The goal of a social media strategy for most companies should not  be to create, manage or curate a community. What companies need to do is consider the types of passions around which their products might fit into existing communities. That might be mothers-to-be or CPAs, pet owners or online gamers.

Some members of these communities you’ll want to make into your customers.

Most of these communities are… and read this carefully… BRAND AGNOSTIC. The brands don’t make the communities. Foodies existed before Whole Foods came along. Foodies will live on long after Whole Foods is gone. People loved exercise and fitness long before Under Armor. When Under Armor is gone, people will still love fitness. If one brand goes away or loses touch with a community another can fill its spot.

What today’s Internet-based communities bring to the table is something marketers have wanted for decades… a concentrated potential customer base to reach out too. Sure, the tactics have changed for all the well-known reasons having to do with social technology and consumer-control, but the strategy isn’t that different from what hucksters have been doing since the days of Mad Men. Marketers must still insert themselves into the lives of their customers. Now, though, those customers can be identified by their passion-based communities and not the media they use at a particular time of day.

That’s the real big difference. Yet the marketing industry ruminates and pontificates and invents new names for age old problems.New generations try to assert themselves among their older peers as some ‘new school’disrupting the old. The dotcom kids did it back in 1999 too (I know, I was one of them.) So much of it is rhetoric and I have to believe a lot of executives see through it. (I hope so anyhow.)

At the end of the day, companies have customers and customers are now reachable through self-organizing communities because new technologies allow it. So communities matter. Social media matters. But a little level setting is in order if we’re to succeed in the world as it really is.