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For those who have had their head in the sand in the past couple of weeks, #IranElection refers to the hashtag that is being used on twitter and other social media sites for anyone who is posting tweets and posts about the ongoing election protests and government brutality in Iran - some call it the latest revolution.

Having been a relatively active “armchair” participant in this latest drama, and always thinking about the impact of social media tools on the world of business, I thought it would be good to take a quick look at some of the lessons that can be drawn from what is happening in the #IranElection campaign.

Lesson #1 - You Cannot Stop It!

No matter how hard you try, you cannot stop the social from taking hold anywhere - not within your employee community, not within your customer communities, and not within your community of detractors. People will find ways to help one another reach and help other people. In this case the government tried to blindfold the country - jamming satellite feeds, shutting off sms and mobile phones, doing deep packet scans on internet traffic, filtering sites, etc - it did not make a difference.

People are hardwired to be social, they now have the tools for the social to scale to where it makes a difference, and they will use it whether you like it or now.

Be like Obama, and embrace it, and don’t emulate Khamenei and his band of crooks.

Lesson #2 - Leadership and Leaders Are Defined By Their Tribe.

In this case we had an accidental leader - Mir Hossein Mousavi. While it is impossible to predict what kind of leader he would have been if he had been declared the winner of the election, most people agree that he would not have been the same leader as the one that emerged in the past two weeks. He has been reshaped by the people who consider him his leader, and is in fact allowing his leadership to continue to be transformed by the people who support him.

There has been a great deal of research on the subject of Tribal Leadership, and how successful leaders are defined by their tribes - you can find much of it in the Tribal Leadership book.

Lesson #3 - The Best People for the Job Will Emerge

Nobody appointed people to play different roles in the self-organizing #IranElection campaign. The best curators bubbled to the top automatically, the best front line reporters, the best organizers, the best leaders, the best technical advisers - all emerged from this chaos in which we also had many trolls and impersonators who tried to disrupt the process.

At different stages of a process lifecycle you will need different talent. That talent cannot be hardwired into fixed hierarchies. You need to enable the social infrastructure that supports your process to allow the right people to step up at the right times.

Lesson #4 - The Best Rules Will Emerge From the Social Messiness

In #IranElection, nobody set rules upfront, yet most people quickly agreed to settle on one dominant hashtag, not retweet names from people who are in Iran, on how to communicate the setup of proxy servers to help people inside Iran access outside services, on how to track impostors and to filter out spammers. Those rules emerged, they were not imposed or dictated by the leadership, nor were they democratically selected.

You have to have trust in your teams’ ability to sense and response and make up rules that are appropriate as the landscape in front of them constantly changes.

Lesson #5 - Social Media Is Not an Information Channel, But A Social Platform

Some debated whether twitter had more value as a news channel or an organizing tool during this latest #IranElection. In a lot of ways that mimics the discussions that many people in business are having around social media tools - is it a new way to reach employees, customers and prospects, or is an inevitable environment in which they can organize themselves into powerful social tribes.

Of course it is the latter - and of course the value as an information/news communication platform is very high as well. It is a platform of participation that allows the social to scale to where it can be turned into movements, both in politics as well as in business. But it is also a platform that allows people to interact, share information, and help other people - whom they trust, much more than faceless corporations or corrupt governments. So it is both an organizing tool as well as a information/news tool.

If you follow behavioral economists like Dan Ariely, who I recently interviewed as part of the CMO 2.0 Influencer Conversations, you will know that there is such a thing as anchoring when it comes to pricing. Basically you can set an anchor for the value of a good and then have people judge all offerings within that space against that anchor. Anchoring is especially important for new product offerings - the ones for which people do not have an assigned value for - like the iPhone when it came out or the Amazon Kindle.

Let’s take a look at the differences between the product pricing strategies for those two products. The iPhone was introduced at $600, only to be reduced two months later to $400. Of course $400 looked like a great deal - when the anchor had been set at $600. And as Dan Ariely explains in a recent MIT Sloan Management Review interview $200 iPhones today look like an even better deal.

The Amazon Kindle on the other hand was announced with books at $9.95 - a subsidized price as Amazon is paying publishers more than that. But that set the anchor for the value of a book on Kindle in the mind of consumers. Now that they raised many books to $15 and up, it does not look like a good deal anymore - in fact it looks like it’s not worth switching to electronic versions of the book anymore. And the Amazon Kindle boards are full of protests by angry customers who are calling for boycotts.

Would Amazon have sold fewer Kindle’s if it had set the price of a book at $15 to start with, and tout some of the other benefits of reading on a Kindle - like searchability, note taking, etc.? It’s hard to prove of course, but I do believe that I would have bought the two Kindles that I bought so far with books at $15 and not feel as bad as I did when they increased their price. Subsidizing prices in a new product category is as bad a strategy as having free offerings to stimulate usage in a new category.

My CMO 2.0 Conversation with Ram Menon was an enlightening one, and definitely another conversation with some real teachable moments. Ram is a no-nonsense marketer with a great deal of common sense.

Ram has an interesting take on the changes in technology marketing. He believes that the 90’s spoiled technology marketers. There was an unprecedented technology boom with plenty of IT budgets to go around, so as a technology marketer the only thing you had to do was set up a pretty web site, put out some collateral and declare victory. In the last few years however, budgets disappeared, technology buyers became disillusioned with technology solutions, and new technologies turned traditional marketing on its head. Consequently, the marketers who did not keep pace are finding themselves in tough times.

One of Ram’s interesting points of view is that bonding is the new branding. You have to bond with 1000’s of people, and at any time…you can no longer plan for a launch, come up with nice messaging, launch and then forget about things until the next launch. In todays world we are facing launches that are on 24/7 and that require ongoing bonding to all of our constituencies.

Marketers need a good understanding of the technologies that are at their disposal to allow them to become better marketers. While he does not see much of a change in the type of people they hire in marketing, that is probably due to their culture of focusing on hiring people who are smarter than you - not necessarily people who have a lot of past experience. For Ram, past experience is no indication of future success.

We also talked about the fact that even though the number of different value propositions for different buyers keeps increasing and that the channels through which you can reach those buyers keeps multiplying, his job as a marketer has in fact become easier and cheaper. The main reason for that is that the most important conversations are no longer the ones you have with your customers and prospects, but instead those that happen among them.

That led to an interesting follow up conversation on their use of communities. They run both a customer community as well as a sales community. Early on they realized that by providing a platform for customers to talk with one another and to help one another, they could in fact make their own job easier. Plus it allowed them to reduce their cost of customer support in the process. They also understood that for the community to work, they needed to be ready to engage - so they encouraged all their engineers to engage with their customers through the community. On the sales side things, they found the same forces at work. By giving sales people a platform in which to help one another, they found that sales professionals started to actually do that across geographic boundaries. Not only that, they started modifying marketing materials and mashing up content to make it work for micro-segments that marketing could not have served in a cost effective way. In effect, they turned their sales process into a social process.

Of course we could not have had a conversation with the CMO of a technology provider who markets a sales and marketing analytics solution without talking about marketing measurements. As we have seen in previous CMO 2.0 Conversations, one of the most important metrics for Ram is customer loyalty. And while they are very metrics-driven, which could in some cases stifle innovation, they support marketing innovation through a dedicated marketing R&D budget.

Other things that we discussed include:

• Offshoring marketing
• How they use social media as part of marketing
• Integration between marketing and customer service
• The issues related to letting go of control
• The need for marketing to formalize sales enablement
• The shift from physical events to virtual events in the marketing mix

As usual, you can listen to the podcast on the CMO 2.0 site and we will be posting the transcript soon.

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  trendwatching.com's June 2009 Trend Briefing covering FOREVERISM

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  embracing conversations, relationships, and products that are never done

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In this social media age, everyone in your company should become a marketer. Like many companies before you, you should empower all your employees to interact with friends, customers, prospects and detractors. Going above and beyond that, let them set up communities within and outside your company’s firewall, about any topic and with whomever they want to hang out with. Many very large (and successful) companies like IBM, Best Buy and Cisco have done it before you - with real success and with very little downside.

Now, as you are harnessing the power of communities, realize that you may have a new asset on your hands - one that some companies have become pretty successful at harnessing, and one which is similar to that of media companies. You now have an audience that others might want to have access to - and that is worth something. Think of Virgin America, which was able to fund the launch of a new hub city through a paid media partnership with HBO. Or think of American Express, with its Open Forum, a community for small businesses, where they are now selling sponsorships on specific sections of their community to partners.

It goes without saying that you should first and foremost think about the value that you will provide to your community members through a partnership. Break the trust they have in you by spamming them and they will leave in droves - leaving you with no asset nor the value that the community was bringing you in the first place.

Everybody will agree that the social has reentered business and commerce as we know it.

In fact, in the beginning, all business was social. If someone sold you a bad chicken, you would badmouth the business and others would shun it until the merchant cleaned up his act. Then the business infrastructure scaled and we ended up with large multi-national companies. People were still social, but the impact of them being social was no longer affecting business – we became at their merci and the social all but disappeared from business. That is when businesses started to develop real bad habits – treating their employees as commodities and waging war with their customers. With social media, a massive platform of participation, the social infrastructure scaled to the point where the social made a difference once again. And because humans are hardwired to be the only Hyper-Social species without all being siblings – the social made a comeback in business with a vengeance.

So what do you do with that? Smart business people, like many of the ones I interviewed as part of the CMO 2.0 Conversation, will tell you that the only thing you can do is to allow your business processes to become social. Barry Judge, the CMO from Best Buy who I interviewed said: “So to the extent that we can basically be human with what we know, and share it as freely as we possibly can, I think we’ll go a long way towards gaining a higher or stronger level of trust with the consumers.” In talking with Luis Suarez recently, he told me that IBM went as far as letting its complete knowledge management process go social. Pfizer’s Sr. VP of Strategy and Innovation, Kristin Peck, was recently quoted in an interview about their innovation process as saying: “when we thought about innovation,we asked ourselves “how do we make it more social?”"

It looks so obvious, right? Yet what do many companies do? Looking at how to commercialize the social that is happening between their customers and prospects. Buying ads on social networks, trying to develop buzz networks, and paying people for recommendations and word of mouth.

That unfortunately will not work much longer. Let’s just hope that those who try to commercialize the social do not muddy the waters with decreased levels of trust among customers and prospects for the rest of us.

My CMO 2.0 Influencer Conversation with behavioral economist Dan Ariely, who is also the author of one of my favorite books, Predictably Irrational, was particularly insightful and instructive.

Dan started the conversation by talking about his past, and how a life changing event - having about 70% of his body burned by a magnesium bomb that detonated close to him - led him on a path of human experimentation.

We quickly moved to one of my favorite topics - how people make decisions either in a market framework or a social framework, and how mixing the two, which inevitably happens in the world of business, is not a good idea.

People are inherently social creatures, and when we talk about money we create a different set of expectations than the ones we have in our social world. The social world and the market world have different rules and regulations. What do you think would happen if instead of taking a bottle of wine to a dinner party you were to give the host cash so that she could buy her own bottle? It would no go over so well, would it?

In the business world we have no choice but to mix the two together, as we hire people in return for a salary, but also tap into social drivers that money cannot buy (i.e., an extreme example of that is firefighters putting their own life on the line, which could not be motivated by any amount of money). Too many companies try to put a monetary value on things where they would be better off leaving it in the social realm. They need to understand the trade-off between economic efficiency and social efficiency. Who would be more motivated to work overtime when you need it - the person who got a $1,000 cash reward for doing well or the one that was sent on a trip to the Bahamas worth $1,000? Research shows that it is the person getting the gift. The same is true for healthcare - why put a monetary value on the healthcare services that you provide to your employees? It does not buy you social efficiency which you could otherwise derive from providing them with that service as a social reward.

Next we talked about group dynamics, especially herding, and how that affects people’s buying behavior. People tend to herd - buy the music that got the most downloads, stand in line at the restaurant that has the longest line, etc. We also follow the herd of our own self, meaning that we buy things based on the way we bought before - even if that was based on a random act.

Dan also reviewed recent research that shows how we internalize the social. In an experiment he gave some people shirts with the term generous printed on it and others with the term stingy printed on it. After wearing the shirt in public for awhile people who had the generous shirts were behaving in a more generous way than those that had the stingy shirt. The interesting part of the experiment is that he got the same results when people were wearing shirts with the same terms printed on the inside of the shirt - so in a way that they were the only ones to know.

Another issue near and dear to many marketers is that of free trials. Free trials for products that are known quantities, i.e., Godiva chocolates, will not lead to the depreciation of value of those products in our mind. Free trials for products that we do not know, and do not assign value to, will diminish the value of that product so that when you start charging for it we will refuse to pay for it.

Other things that we talked about include:

• The dark side of social rewards
• How the feedback you get from focus groups can be very suspect because people have bad intuitions about their own behavior
• How ideation works best when other people can build on your ideas
• The importance of experimentation and business education in business
• How pricing is not determined by supply and demand and the importance of self-herding
• Behavioral economics and its impact on the economy and the stock market
• The honesty mindframe and its influence on cheating

As usual you can listen to the podcast on the CMO 2.0 Site and soon we will be putting up transcripts of this CMO 2.0 Influencer Conversation.

• People are Talking
  Anticipate product performance through online discussions

• 80% of Recession Shoppers Want Companies with ‘Human Face’

I get that question so often that I thought I would write a short post about it. What is the difference between a B2B and a B2C community? Or people will ask me, can you please only show me B2B examples because we are different than B2C.

When it comes to communities - especially successful ones - there is no difference between the two. The main interactions in communities do not happen between businesses and other businesses, or between businesses and consumers - they happen between humans and other humans. And that is no different in B2B than in B2C environments.

Sure, some people will show a greater affinity for a consumer product than they will for a piece of enterprise software, but successful communities are never built around products, they are built around the members and their shared emotions. Even the Harley community is not built around bikes, it’s built around a shared lifestyle of the community members. And so the dynamics within that community will in fact not be all that different from the dynamics you would find in a software developer community - it comes down to human to human interactions or h2h.