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CMO 2.0 Conversation with Erin Nelson, CMO at Dell, and Manish Mehta, VP of Social Media and Communities

March 4th, 2010 francois Posted in Interesting Links 10 Comments »

erin-nelsonmanishMy CMO 2.0 Conversation with Erin Nelson, the CMO at Dell, came with a bonus in that Manish Mehta, the VP of Social Media and Community for Dell joined us as well. I hope you will enjoy this CMO 2.0 Conversation as much as I did.

Erin is responsible for Dell’s Global brand strategy, social media, global communication, as well as for the talent development of the Dell marketing teams – where she focuses on reinvigorating the way Dell marketing works. She has been with Dell for 11 years, while Manish has been with them for 15 years. Manish is in charge of social media and communities, including dell.com, their intranet and their extranet.

One of the first things we discussed was the role of social media and communities within Dell’s business strategy – and how they got to become one of the leaders in social media adoption. On the one hand, dealing with customers directly through social media is a natural extension of what the Dell brand has been all about for the past 25 years – having a direct relationship with the customer. On the other hand it was also precipitated by what has come to be known as “Dell Hell”, when prominent blogger Jeff Jarvis and others had some not too flattering things to say about Dell in public forums. The latter incident gave them no choice but to jump full force into embracing the social on a large scale. As Erin said, it wasn’t a question of test, learn, and measure, it was actually a question of survival – with their brand under severe pressure. In hindsight, Erin believes that this has been a huge benefit for Dell, saying that you cannot get into social media by just putting a toe in the water – you are either all in and it becomes part of your culture, or you’re not.

As we argue in our upcoming book, the Hyper-Social organization, we could not agree more. Companies that successfully embrace the social are those, like Dell, that make it part of the fabric or DNA of everything they do – it cannot just be managed as bolt-on programs to existing strategies. It is also interesting to note how companies like Dell and IBM, which have managed to totally transform themselves, were able to do so only after “near death” experiences (and those are my words/observations, not Dell’s). Dell truly rebuilt itself with the customer at the core of everything they do – how they sell, how they market, how they service and support, how they communicate, and how they design new products.

The scale at which Dell interacts with customers online is staggering – with billions of connections every year through the purchase path, the support path, and through the community path of learning how to use technology and achieve more with it. All that cross-functional customer interaction required them to set up a cross functional governance council, with member representatives from across the entire company – business units, marketing teams, service organizations, and product organizations. They meet on a regular basis to share the learnings, and to make sure that the learnings become embedded within all company processes.

Next we talked about the lessons learned from listening to what is being said about the company in the marketplace and from deciding how and when to engage in those conversations. As many other successful Hyper-Social organization CMO’s told us, they do not always engage. Listening is incredibly important, but often times hearing, learning, and acting upon what is being said are the real keys to success – not direct engagement. It is also important to realize that in this new world, notwithstanding that you can have a common brand spirit, you cannot really have a singular voice of the company anymore. At Dell they have 100,000 team members who are experts in what they do and who will speak out in their own voice.

We also spent a fair amount of time talking about how best to measure the impact of social media and community initiatives – especially in view of the recent announcement that Dell sold $6.5M worth of products through their Twitter channel last year. Obvioulsy being engaged in social channels such as Twitter is not all about generating revenue (although that is a nice side effect). At Dell they try to gauge many other things, including level of engagement/connectedness, sentiment, the value that they are adding in the customers’ buying decisions, and whether they add value in how customers utilize their technology better.

Lastly we talked about some of the recent changes that Dell made to their IdeaStorm environment, and how they felt the need to expand their successful online suggestion box concept with directed and time-bound innovation jams called Storm Sessions through which they ask the community questions in real time, sometimes for days, sometimes for weeks, and sometimes for hours. They have found this real time learning capability, which they use both inside and outside, to be extremely powerful.

Other things that we discussed include:

  • The importance of assigning roles to employees who engage in social media – making sure, for example, that technically unqualified employees do not attempt to respond to tech issues
  • The challenges associated with integrating acquisitions within your corporate culture (specifically the acquisition of Pro Systems, which increased the number of employees at Dell by 40%).
  • How making the social part of the fabric of the way they do business changed the way they think about market segments – thinking more about customer clusters or tribes rather than classic demographically based segments
  • The importance of ratings and reviews in leveraging the social as part of your business
  • The two types of customer interactions that happen online – disgruntled ones where you need to turn their sentiment from a negative to a positive, and fans, who are brand amabassadors and who you want to engage to influence the influencers
  • The importance and risks of status in communities
  • How talent acquisition shifted from looking for people with existing expertise to people who can develop new capabilities

As usual, you can listen to the full podcast on the CMO 2.0 site.



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CMO 2.0 Conversation with Christa Carone, CMO at Xerox

March 3rd, 2010 francois Posted in Interesting Links 8 Comments »

ccaronesmI had a very insightful CMO 2.0 conversation with Christa Carone, the CMO at Xerox. As with many other CMO’s I interviewed on this site, Christa has had a pretty long tenure at Xerox – 14 years to be exact, with the last 1 1/2 years as CMO.

Being the CMO at Xerox is a unique position in that the company is in the business of helping its customers market themselves better. So not only do you need to market your company, you also need to serve as a best practice for your customers – you need to walk the talk.

Early on in the conversation we talked about the dramatic changes that social media brought to customer communications and go-to-market strategies. Christa described how Xerox is very active in social media and how they have a real cross-functional approach to social marketing. They found that the cross-functional team that they put in place, which consists of existing social media enthusiasts, is keeping a much higher level of energy than typical cross-functional teams. Part of the reason for this is that they enlisted people who had a personal passion that they could now put to work on behalf of their company.

They obviously listen to what is being said about themselves, and they pay a lot of attention to what conversations to participate in, and perhaps more importantly which ones to stay away from – realizing that sometimes participating in conversations can hinder more than help. An interesting problem that they face in listening to what is being said about them is that the term Xerox is often being used as a verb and returns a lot of content that isn’t relevant to them. They also get the fact that sometimes you can start a conversation on your own platform, but that often times conversations already exist somewhere else and that in these cases it is better to engage people where they are rather than try to attract them to your own environment. As Christa said, you can build it, but if nobody shows up, you are not getting any return on your investment. Unfortunatelly, and according to the results of our yearly Tribalization of Business Study, most companies do not realize that – resulting in many dead company-sponsored forums and communities littering the web.

At Xerox, they encourage every employee to become part of the voice of the company. They developed friendly guidelines that empower employees and encourage them to use social media on behalf of the company. By tapping into employees’ passion they are achieving a level of virality with new product launches that they never saw before. In order to do this they had to give up some control, but the benefits are tremendous.

Next we switched the discussion to some more traditional marketing issues – including how to deliver a consistent brand experience through a complex distribution channel, and the impact of the economic downturn on the marketing mix.

Xerox has over 10,000 resellers and more than 6,500 authorized sales agents – making for a lot of customer touch-points. While they are incredibly disciplined on branding, they, like everyone else, are losing some control of how the brand is being perceived by the customer. What perhaps keeps the brand perception across all those touch points the most consistent is a shared passion for the brand by both employees and channel partners.

The economic downturn and the associated reductions in marketing spent has had three major effects on Xerox’ marketing mix. First they doubled down on cross-media customized content (one-to-one) as part of their direct marketing campaigns – dramatically improving their rates of return from their target markets. Second, they redefined marketing programs for which they had long standing contractual obligations like sports sponsorships – turning them into business functions where the customer hospitality actually has a business purpose. Not only did they get business value from it, the hospitality piece allowed them to strengthen the relationship with their customers. Third, and they are still working on that, they developed an integrated communications/messaging platform that has tentacles across all lines of business and that is more than just a tag line or ad campaign for the company.

Another interesting part of the conversation was when we talked about how Xerox transitioned from being a research lab-driven bastion for innovation to a customer-driven innovator. They still have their research centers, but even the researchers get out of the labs and participate in the periodic “dreaming with the customer” sessions that are now at the core of the Xerox innovation process.

We closed the conversation by talking about the need for new marketing metrics in this new socially-enabled business world. As some other CMOs said in previous CMO 2.0 Conversations, Christa reminded us that there is a certain level of subjectivity that goes into what we do in marketing. There is this gut check that says that something’s working, especially when you are looking at brand based marketing that is not intended to have a direct and short term revenue-generating objective to it.

Other things that we discussed include:

  • The role of one to one communications in marketing
  • The challenges associated with shifting marketing resources to social media marketing (discretionary budgets vs. headcount)
  • How to use Facebook as an extension of your employee communications strategy
  • How to strike the right balance between being taken hostage and spending the right amount of energy with those people who have the largest social media megaphones
  • The importance of surrounding yourself with people who can make good judgment calls on behalf of the company
  • The changing role of market research in defining the marketing mix
  • The importance of employee passion in getting things done

As usual you can listen to the full podcast of the CMO 2.0 conversation on the CMO 2.0 site.



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Active lurkers – the hidden asset in online communities

February 18th, 2010 francois Posted in Hyper Social Enterprise, Interesting Links, Strategy, communities, social media, social networking 34 Comments »

lurkersmMost communities have 90% of users who are lurkers – people who may consume things from the community, but who don’t contribute. Through our yearly Tribalization of Business Study, we found that many companies who run communities consider this a problem (30% of respondents considered it an obstacle) – and that of course is a problem all by itself.

You see, not all lurkers are created equal.

While it is inevitable that larger communities will end up with 1% of their members being very active users who provide enough value for the 9% of somewhat active users, who together provide enough value for the 90% of lurkers, the largest form of participation in online communities happens to be active lurking, which according to an MIT research study can make up 40-50%  of your community membership. Active lurkers are those that may take something from the community and pass it along to others using different channels – so they participate in your word of mouth. Active lurkers also include those people who may visit a customer support community and find a solution to their problem without contributing to the community. Those people derive a lot of value from that community interaction and so does your company since they do not clog up your customer call center. Active lurkers also include those who will contact the original poster through a different channel, like telephone, email, or perhaps a face to face meeting – in effect continuing the conversation outside of the visible public side of the community, but not outside of the community itself.

Thankfully we found that 18% of companies who participated in the 2nd Annual Tribalization of Business are starting to track lurker metrics. It’s not easy to measure the impact of active lurkers, but without some sort of measure about their activity, you could miss a lot of the value that they bring to your Hyper-Social processes – especially in a world where the customer lifetime value is directly proportional with word of mouth activities.

When you think about communities, you need to think about the tribes and their members first, not just one of the public places (the online community forum) where they can interact with other tribe members. They will inevitably interact in multiple places, both virtual and physical.



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Customer Reference Programs in a Hyper-Social world

February 17th, 2010 francois Posted in Hyper Social Enterprise, Interesting Links, buying behaviour, word of mouth 27 Comments »

recommendationsmThere is no question that customer reference programs do work. Long employed to support sales and marketing (you cannot talk to an analyst without having customer references) efforts in the B2B space, they tap into one of the age-old Human 1.0 characteristics – the drive to mimic the behavior of others, especially of those who are perceived to be successful within our tribes.

The problem with many traditional customer reference programs is that they are based on the old marketing principles – designed for interrupt-driven company-to-prospect communications, product-centric, and non-reciprocal. It’s no surprise that in a Hyper-Social world they no longer deliver the expected results.

So what are marketers to do? As is usual in the Hyper-Social world, the answer is pretty straightforward. Here are 5 things that marketers should consider when developing Hyper-Socially enabled customer reference programs.

  1. Let go of control and empower customers to tell their own stories
    At the risk of sounding like a broken record, it’s important to understand that the most important conversations are no longer the ones that happen between your company and its customers/prospects, but instead the conversations that happen among them. They’ve come to distrust the information that comes from your company, and with the advent of social media and communities they have much more opportunities to get information from unbiased sources (e.g., colleagues & acquaintances) that carry much more credibility. A majority of the customer stories that lead to buying decisions no longer come from your company but are instead originating within your customer tribes (online communities, industry associations, etc.). When I explained this to a marketing agency owner who also owned a print shop, he was originally skeptical, but then remembered how he had made a multimillion dollar press purchase decision not based on any information that came from the press manufacturer, but rather based on a trusted fellow print shop owner within his industry association. So if you want a successful customer reference program, you need to find ways to help your customers tell their own stories within their own networks. You don’t want to control or help them shape their story, you want to provide them with information that will help them strengthen their story and improve their status as opinion leaders within their network.
  2. Make sure all your customer stories are customer-centric to a fault
    Most customer references are product- and company-centric. They are focused on confirming the features and benefits of certain product attributes more so than the customer pains and tribulations associated with successful product deployment and adoption. For the minority of customer references that will originate from your company,  you need to ensure that they are customer-centric to a fault. Not only will they carry more credibility, they will also travel better as “retellable” stories among your customer and prospect networks.
  3. Think tribes, not market-segments
    It is true that in a majority of cases people will only accept customer reference stories from withing their own industry – thinking that anyone outside of their industry does not understand the issues specific to their environment. That does not mean that you should develop customer stories only around market segments. See if you can also develop them around tribes – groups of people within your industries that tend to hang together based on common behavioral characteristics. So instead of documenting a customer story for pharmaceutical CIOs, see if you can develop one for CIOs who are passionate about sustainability.
  4. Don’t pay for your customer references
    On more than one occasion have I written about the cons and cons of paying people for any kind of feedback. The same is true for customer stories. If you have to pay someone for a story, it’s probably not a very strong story – definitely not one that your customer would be willing to tell his friends without being compensated for it first. So don’t put it out there. Of course, that does not mean that you should not base your customer reference program on reciprocity – you should. Allow the customer who recommends your product to give a gift to those he is recommending the product to – a small discount, or a special free feature – or make everyone feel warm and fuzzy by having reference program metrics trigger donations to worthwhile charities.
  5. Forget information channels and think knowledge networks
    Most customer reference stories are written like brochures – they have the facts, the benefits (including amazing ROIs), and information about the company and its products. They are information rich and lack real knowledge. They are built to be distributed through information channels like email newsletters, traditional media outlets, and customer story aggregation web sites. The problem is that when your customers talk to colleagues, friends, and acquaintances, they do not transfer information, they transfer knowledge and stories. If you reference stories don’t have those, they will not travel along the knowledge networks where buying decisions are increasingly being made.

Customer reference programs should not be set up as standalone programs – they need to be part of your overall Hyper-Social efforts, including your word of mouth activities.

What do you think? I would appreciate your feedback on this as I will be leading a conversation on the topic at the upcoming customer reference forum.



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Word of Mouth from non-loyal customers has the biggest impact on sales

February 11th, 2010 francois Posted in Interesting Links, word of mouth 15 Comments »

loyaltysmFirst off, thanks for your patience after this long hiatus in my blog activity. Now let’s just get back into it!

When you are trying to “fabricate” Word of Mouth (WOM) for your offerings, who do you think of approaching first? Chances are that your first choice is to enlist the help of  your most loyal customers. After all, they have the success stories to tell others, they like you, and you have an existing relationship with them – it’s a “no-brainer.”

In reality, additional WOM from that group will have the least impact on your sales because those people likely already told their networks about how good you are. It’s the WOM from non-loyal customers and prospects, those who have not informed their network about you (or may not even know you yet) that will have the highest impact on sales. When you think about it that way it makes just as much sense as Peter Drucker saying that most firms should focus their new product innovation on non-customers since 70% of all customers that will be needed to ensure a firm’s future revenue are not currently customers..

You don’t buy it? Well fortunately there are a couple of studies by David Godes and Dina Mayzlin that prove this point. They did find that the impact of WOM from non-loyals on sales was indeed bigger than the impact of WOM from loyal customers. The other counter-intuitive (or maybe not) observation that came out of the study is the fact that among the non-loyal customers, it is not the opinion leaders who will be buzzing. Opinion leaders, or experts, will only buzz about stuff that they feel strong (and thus loyal) about. The people who seem to be the most effective buzzers within the non loyals are all highly connected. It is not clear, however, whether highly connected individuals are a good predictor of becoming an effective buzzer – making for a tricky targeting strategy.



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Forget information channels – how organizations must embrace knowledge networks instead

December 1st, 2009 francois Posted in Hyper Social Enterprise, Interesting Links 25 Comments »

networkssmInformation channels stop working when the customer is collaboratively involved in the delivery of the message. When that happens, the message (and sometimes the definition of the product and its value) changes as it is propagated through the network. Moreover, some customers will be more “important” than others, due to their location and status in the network. The message may also change in response to what the network feels the message is, or should be, or simply because of the typical sharpening (the emphasizing of what the speaker considers the gist of the message) and leveling (the de-emphasizing of those pieces considered less important) that happen to messages when they travel through networks made up of humans 1.0. Accordingly, the message might have to be clarified by the company or another interested human, or the actual propagation might force a review of what the desired message was or should be. What’s the upshot of all of this uncertainty? One clear answer is that discrete business “channels” are an endangered species.

In a networked world, where your customers, potential customers, and detractors are all nodes equally visible to every other node, there is no such opportunity for the company to control “the channel” as they might have in the past. In a Hyper-Social environment, where you don’t know who will be participating in the conversation until the conversation actually begins, it is impossible to create separate pathways where you can message a retailer, a customer, or a business partner.

That being said, you need to be aware of the topology of the networks that exist within your tribes, as differences among them call for different approaches. In some cases you will have very tightly connected members at the core of you network with others at the fringes that are less connected; in some cases you may have more evenly distributed networks; or you may even have networks that have ring networks inside of them. The tribal network characteristics will determine where you might want to position yourself within the network (if they allow you to become part of it) and how to most effectively have your content travel through them. In some cases you will want to target the members who are the most connected at the center of your network, and in some cases you will be better off by targeting those who are loosely connected to them. You should also understand the nature of the social bonds and leadership structures that exist within your Hyper-Social networks. If the leadership does not rotate on a periodic basis, or doesn’t allow for newcomers to achieve status within reasonable amount of time, that is a problem. The type of bonds that people have with one another is also an important characteristic. In certain environments, such as sites with product reviews, connectedness is not all that important, but status might be. In other environments, where people are helping one another in the context of complex problem solving, connection is an important factor that will determine how knowledge flows within those communities. In all cases you will need to gather network characteristics for active lurkers – the largest and potentially most influential participation group within your community. They are those who participate and share information with others, but do so using different channels (phone, face-to-face, or email) than the public community forums.

Another fundamental difference between channels and networks lies in what flows through them. Data and information flow through channels, whereas networks allow knowledge to flow. As John Hagel said when I talked with him: “unlike information or data flows, knowledge does not flow easily – as it relies on long-term trust-based relationships.”

There are two reasons why this is an important distinction to make – one for buyers and one for companies.

Besides the fact that as potential buyers we don’t trust the non-reciprocal communications that companies want to have with us through fixed interrupt-based channels, we turn to our trusted networks because we can gain actual knowledge about products and services – a commodity much more valuable than plain old data or information about them.

As for companies, they need to increase their external knowledge flows if they are to survive. When I spoke with John Hagel he explained how he believes that in this era of intensifying competition, we need to shift from a knowledge stock mentality, where you aggressively protect and hoard proprietary knowledge, build scalable offerings around it, and then extract value from it for the longest possible time, to a knowledge flow mentality, where you realize that what you know today has rapidly diminishing value and where you refresh your knowledge stocks by participating in knowledge flows. So the key to success in this new economic reality is to move from a transactional world to a long-term trust-based world. Examples of taking on a knowledge flow approach include letting your key customers participate in product innovation, or turning them into affiliates to allow them to help one another.

What do you think? As usual, I would be interested in your thoughts.



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links for 2009-11-13

November 13th, 2009 delicious Posted in Interesting Links 3 Comments »



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Brand positioning takes on a new meaning in a Hyper-Social world

November 10th, 2009 francois Posted in Hyper Social Enterprise, Interesting Links, branding, buying behaviour, communities, web 2.0 42 Comments »

brandingtagsmSome pundits will tell you that you should do away with brand messaging and positioning all together, since you cannot control it anyway. Not so fast! People need to know what bucket to put your offering in, and if they can’t, they won’t know how to assign value to what you have to offer. Tivo ended up in that pickle, with consumers not quite sure what category of products to compare the offering with. Was it more like a DVD player or was it more like a computer?

Knowing that a good positioning will impact your revenue and profits, and realizing that you still have a seat at the customer decision making table (it’s just a much more crowded table and your share of voice has significantly been reduced) you need to develop a point of view about your positioning and try to get it co-opted by your tribe. Like in most social interactions, your chances to get someone to adopt your point of view are going to increase if you involve them early on. The more say you give them in the process of co-creating your products and services, and the earlier you get them involved (preferably at the product concept stage) the more they will embrace a shared view of the brand and product positioning. An added benefit of co-creating products with your customers is that those who are involved in the design of new products will typically pay higher prices for those products .

Marketing executives have come to understand, sometimes the hard way, that brand perception is only as good as the last interaction the customer had with it. When I spoke with Mark Colombo, senior vice president of digital access marketing at FedEx he described the challenge as follows: “In the 50’s and 60’s, brands used to be built on a set of attributes. Now brands are built by customers, one experience at a time, and those experiences are, obviously, more and more online experiences.” So you cannot just convey a brand’s promise or a product’s positioning through advertising and packaging anymore, you also need to deliver against that promise across all your other customer touch-points, and at any time. That becomes especially challenging when you have complex product distribution channels, high numbers of people involved in your service delivery, or a high level of interaction between your customers and your customer service and support center. It gets further complicated by user generated touch-points that people will encounter in the form of online reviews, blogs, and online communities. All those touch-points can make or break your brand, product, or service promise and position. Like many other things in marketing, this is not something new; it’s just something that we used to get away with because our customers, prospects and detractors could not behave Hyper-Socially and hold us accountable for our actions.

The way you control a brand promise through multiple touch-points is not through elaborate process manuals that we have grown accustomed to in business. The way to do it is by embracing Hyper-Sociality and all the messiness that comes with it and allow all the people involved in the process to behave like humans. Some companies like Zappos and JetBlue achieve that through a shared values-based culture that creates a common sense of belonging among their employees. Others like Western Union achieve it by becoming customer-centric to a fault. Still others, like IBM, are doing it by encouraging all their employees to set up communities with whomever they want, wherever they want, and about anything they want.

The key to success is to embrace all four tenets of Hyper-Sociality: think tribes, knowledge networks, customer-centricity, and be willing to accept some of the messiness that comes with Hyper-Sociality.

What do you think? I would appreciate your feedback.



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Twitter Weekly Updates for 2009-11-06

November 6th, 2009 francois Posted in Interesting Links 2 Comments »

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Twitter Weekly Updates for 2009-10-30

October 30th, 2009 francois Posted in Interesting Links 1 Comment »

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