emergencemarketing.com

• IBM’s Webbie World - Forbes.com
  Cool article on how IBM leverages communities and social media tools
  (tags: enterprise2.0, web 2. web2.0, community , socialnetwork)

My 13 year old son, who is an avid snowboarder has been producing a couple of snowboard competition videos recently. As a very biased dad I off course think that they are wonderful.

But what got me most puzzled is by how he went about promoting it - he hired a friend of his to promote both videos. The friend, who is also a snowboarder, goes into snowboard magazine chat rooms and online store chat rooms to promote the heck out of the videos. When the friend gets a good response in a chat room, or when he hits a milestone in terms of views, he calls my son to report back on what happened. All that for $3/video. Another interesting tidbit about the emerging entrepreneurship at my son’s school is the underground banking system. For years my son has had a kid in class who they call the banker. If you do not have enough money for lunch he will loan you $1 and expect $1.50 back the next day. When my son’s payment was due for his marketing hire, and he realized he had no money, a competitor to the original banker emerged. He only charges 33% interest, but he has a $3 minimum on his loans.

Fun to watch those kids…

This is a pretty neat intro to a new book (via David Armano on twitter)

(RSS subscribers who cannot see the video click here)

This is too funny…

(for RSS subscribers who cannot see the video, click here - http://www.youtube.com/watch?v=a5hQKFzcvGU)

(Via ExperienceCurve)

We recently launched a new blog on the future of marketing - and called it marketing 2.0 - a term that surely will draw some criticism, but which very well describes the conversation we want to have.

Where is marketing going? Why are the marketing processes that we have grown accustomed to no longer delivering the predictable results that we were used to? What should we change to succeed?

We have assembled a great group of people to lead this conversation - including David Berkowitz, Paul Dunay, Lois Kelly, Valeria Maltoni, David Rogers, and Constantine von Hoffman. You can expect additional contributors to join the group over time.

We hope you will enjoy and join the conversation.

That is the question that MIT professor in behavioral economics Dan Ariely tries to make his readers think about in his new book, Predictably Irrational: The Hidden Forces That Shape Our Decisions, as he proves that most people are indeed predictably irrational.

Take the following experiment as an example. In the experiment, students were introduced to six products - two different wine bottles, a trackball, a wireless keyboard and mouse, a design book and a box of Belgian chocolates. Students were then given a form that listed all the items and asked to write the last two digits of their social security on top of the form and also next to each item in the form of a price. So, if someone’s last two digits was 23, they were asked to put $23 next to each item on the form. Next they were asked whether they would pay that price for that item with a simple yes or no. When the students finished that, they were asked how much they would be willing to bid for each item. Well guess what? The students with the highest-ending social security digits (from 80-99) bid highest, while those with the lowest-ending numbers (0-20) bid lowest. In the case of the cordless keyboard, the top 20 percent bid an average of $56, while the bottom 20% were willing to pay an average of $16. Overall the top 20% were willing to pay prices that were 216 to 346 percent higher than those of the students with social security numbers ending in the lowest 20%.

And that is just one of the many examples given in Prof. Ariely’s book.

So what does this all mean? As an economist, Ariely believes that fundamental economic principles like the one where supply and demand determine pricing, or the claim that free markets and free trade benefit everyone involved in those transactions, may in fact be bogus. The first one is based on the assumption that the supply and demand forces are independent from one another. The second is based on the assumption that all players in the market know the value of what they have and the value of the things they are considering getting from the trade. But if our choices are affected by random initial anchor prices as demonstrated in the experiment above as well as other experiments listed in the book, then the price that I am willing to pay (demand) can be heavily influenced by the supply side through MRSP (manufacturers suggested retail price), promotions, discounts, etc. So it is not the consumers’ willingness to pay that influences the market price, but instead the market prices themselves that influence the consumers’ willingness to pay. And for the same reason, the choices and trades we make in free markets may not at all reflect the true benefit that we would derive from the things we trade.

So what does that mean from a marketing perspective? For starters, and as it relates to pricing, it means that marketers may in fact have more control over buying behavior than they are currently given credit for. Additional research described in the book as well as on Ariely’s web site and blog, indicates that marketers may in fact be able to influence much more than the price a consumer is willing to pay for something, but also influence their general buying preferences.

In the end, the consumer may not be as much in charge as you think…

In reading Influencer: The Power to Change Anything, authored by multiple authors (more detailed comments from the book coming soon - definitely a good and recommended read), I came across this interesting set of studies that look at the impact of the “conspiracy of silence” that reigns in many organizations.

One study focused on hospitals, and looked at how the conspiracy of silence held in place powerful norms that kept people from speaking up when colleagues violated hygiene, safety or any other protocol - leading to unnecessary deaths. Take those numbers - 84% of doctors have seen co-workers taking shortcuts that could be dangerous to patients, yet fewer than 10% of physicians, nurses and other clinical staff directly confront their colleagues about their concerns. The main drivers leading to this type of culture in hospitals are the risks of lawsuit and infamy. You can find more on that study at www.silencekills.com.

Another study looked at other industries and found that the same code of silence sustains unhealthy behavior across the board. The vast majority of product launches, reorganizations, mergers and improvement initiatives fail or dissapoint because of it. In fact, the researchers found that 91% of all large scale corporate projects collapse because people fail to speak up and be heard. They argue that a deadly form of corporate silence lies at the root of all failed projects. Project problems are in fact people problems. For more information about that project and to download the findings of the study, go to www.silencefails.com.

Most of us have been in organizations where it is politically unacceptable to speak openly about what is going wrong - only to see projects fail because of weak sponsorship, unreasonable constraints, unmotivated team members, or plain old politics. It is sort of ironic that while not speaking up will eventually kill the organization in which you work and thus your current job prospect - it is job preservation that drives this behavior.

What most organizations do not realize is that this is not based on individual behavior, but rather on social behavior. Fixing this problem will not happen by focusing on changing individual behavior first, but instead by changing the social norms that drive the social behavior - and that is not a trivial task.

The Online Publisher Association announced that it added Community as a category to its Internet Activity Index (IAI). So they will now measure how much time consumers spend online with Content, Communications, Commerce, Search and Community.

The OPA defines community as:

“Web sites and applications that combine user-generated content with communications in order to foster relationships between individual members and groups of members. Many Community sites are content driven, and they were previously accounted for in the Content category. However Community’s content is largely user-generated, and when merged with communication, creates a specific category of online activity.”

The IAI numbers for January show that consumers spent 42.7% of their online time interacting with content, 28.7% with communications, 16.1% with commerce, 7.5% with community and 5.0% with search.

AdAge picked up on the story, declaring “When It Comes to Time Spent Online, Content Trumps Community.”

But wait a minute here, adding community as a category at the same level as content, communications, search and commerce, is like comparing apples and oranges. Or better yet, comparing apples and oranges with air or water. Communities are combinations of content, commerce, communications and search. And communities affect the usage pattern of all the above categories and vice versa. So if I am spending time on Amazon.com, am I spending time with commerce, content, search or community? Obviously the end result is commerce if I buy something, but it could also be searching without buying or interacting with content (both user generated reviews and published content) without commerce. The fact that Amazon is a community which leverages my personal profile very well (another component of communities) is determining my interactions and time consumption on that site. The same can be said for many other sites that combine content with community. If I am spending time on the WSJ Health blog, I am spending time with content or community? If as a car buff I spend time on Carspace.com, I am spending time with commerce, content or community? Would I spend as much time conducting commerce, searching for stuff or interacting with the content on those sites if there were no community component to them?

Probably not…

Besides the fact something does not sit right with the categories, many conclusions drawn from the new numbers by AdAge and the IPA are equally flawed. Jim Nail at the Cymphony’s Influence 2.0 blog captures those flaws in detail in his post today (well worth the read). A couple of highlights include:

• The fact that page views per person in content dropped 225 pages suggests that a number of content sites were just moved to community.
• Content sites show 480 pages per month per user vs. 380 pages for community sites. So from an ad perspective, the reach may be just the same.
• Another factor not reflected in the new numbers is influence. If a third of people below 30 don’t make buying decisions before checking with their social networks, the impact of communities on the commerce is obviously not reflected in those numbers.

We should of course remember the agendas that both organizations are representing - those of advertisers and publishers.

A new research study by CNET - Understanding Influence, and Making It Work For You: A CNET Networks Study (full PDF here - via Guy Kawasaki) - finds that many word of mouth programs may in fact be targeted at the wrong people.

The three-part research found that because of their sheer number, the group of people who wields the most influence is in fact not the most connected but instead the moderately connected.

Other interesting findings from the research include:

• Influencers are primarily motivated by the desire to help others - not to demonstrate and get recognition for their expertise
• Most people have multiple areas of interest and influence others in more than one category
• People consider information to be valuable if it is BOTH unique and trustworthy, and sources that provide unique and trusted information will be referred over and over again
• Influencers tend to be active members in their online communities
• influencers rely so heavily on technology, information that is provided in easily shareable electronic formats is much more likely to be forwarded

The conclusion of the report: “Influence is not, in fact, exclusive, but is something we all share. Influence is not a function of charisma so much as it’s a function of human nature – people are alike in more ways than they differ.”

Of course, we need to keep in mind that this study is sponsored by an organization that benefits from marketers taking a broad shot-gun approach to marketing/advertising instead of trying to pinpoint content/messages to a select few.

Nevertheless, it does provide a few interesting questions that you may want to ask yourself before engaging in your next marketing campaign:

• Is the information you make available to communities unique and trustworthy? Can it be coming from you, the marketer, or should you find other people to tell your stories?
• Is your information actionable and retell-able?
• Are you targeting the right communities, or are you being narrow minded in the way you focus on communities of interest?

A new TNS/Cymfony study found that marketers feel that their agencies are ill equipped to help them succeed in leveraging social media as part of their marketing mix (via David Armano tweet).

It’s a phenomenon that we’re seeing in our client base as well. Agencies sometimes talk the talk, but when you sign on the dotted line the next thing you know is that there is a team of junior people walking in your door doing exactly the same thing they were doing 15 years ago. And when you find someone with deep expertise in social media, often times they do not understand the lingo of a traditional marketer.