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[update 5/17/11] – the editor for the magazine got back with me, apologized and rectified the situation. I removed their name from the title of he post.

At some point in time tonight, I got a Google Alert about the Tribalization of Business Study, a study which I co-founded with Deloitte and the Society for New Communications Research and which is in its 4th year.

The article, written by Marco Ciobo, a Principal at AT Kearney, claimed that “A study by AT Kearney in 2009, called The Tribalization of Business, found that the vast majority of Fortune 500 companies in the US investigated, and then relegated, social media to the marketing department, which was also given responsibility for imposing tight policy controls on its use.” (screenshot here)

I immediately posted a comment on the Business Spectator Article, alerting them to the fact that the study was not done by AT Kearney, but by Human 1.0 (formerly Beeline Labs), Deloitte and the Society for New Communications Research. I also tweeted my indignation with the obvious plagiarism. After all, the study made for the foundation of our award winning book, The Hyper-Social Organization, which was published by McGraw-Hill last year.

The comment was not approved, but the article was modified to say that “A study by Deloitte and the Society for New Communications Research, in 2009, called The Tribalization of Business*” – without any mention that:

• The article had been modified
• Human 1.0/Beeline Labs is a founding sponsor and a driving force behind the study

In my book, this is a bad practice all around, violating most Human 1.0 principles we discovered through the Tribalization of Business study.

[update 12/21/2010] @fearlessweb tweeted me the following message: “@fgossieaux Your URL has been unblocked due to a false positive and should be accessible to your customers. Apologies for the inconvenience.” – hopefully done for now…

Original message:

Trend Micro is an Internet Security software company that claims to be protecting your business from viruses and spyware. They do that, and they also prevent small businesses like mine from conducting  business.

Our site, www.human1.com, which is built 100% on WordPress, and designed by some of the best people in the industry is categorized as ‘malicious’. Human 1.0 prospects and customers have alerted us of that fact for well over a month. We tried to submit for reclassification of our site, but you need to be a customer to do that. Obviously that is not something we would ever consider.

They also claim to be listening on twitter and so I engaged them there – again with limited success.

So how is it having an immediate impact on our business?

We are running two very high end workshops in January. We invested thousands of $$ to promote the events, only to find Trend Micro clients not being able to access our site. Not only can they not access our site and register, the fact that Trend Micro calls us malicious does not make for a good impression –  let’s face it, the fact that “the security system” calls us malicious is not good for our reputation. We even had a sponsor for the event pull out because of this issue…

So Trend Micro – what is it going to be? Do we need to spend more money to have our lawyer contact you? Who is the ‘malicious’ party in this case?

You are hurting business…and you should be ashamed of your business practices. Maybe you should be regulated.

Amazon lost one of its most loyal customers yesterday – ME.

I used to be a walking billboard for Amazon. I felt like they cared about me and were delivering me good services. I ignored those who told me that I could buy products cheaper in other places. I felt special.

I  know of at least a dozen people who bought their Kindle and countless others who bought books based on my recommendations. Knowing that customers who become customers through word of mouth can be twice as valuable as customers that come in through advertising, that must be worth something. Plus, I bought 850 items from them over the years – that’s a heck of a lot of stuff…especially when considering that many of those items are not books, but 4 digit purchases like high end cameras, high end lenses, and barbecues.

But I will now donate my new Kindle, buy the iPad, and test other book delivery services.

Why?

Because they told me I was not special after all…

My Kindle (the second one I bought) broke last Friday. I called Saturday and was promised a new one by Tuesday. Tuesday, no Kindle. Wednesday, no Kindle. Wednesday I call again. This time their automatic callback system calls me and puts me in a 10 minute queue. The chipper customer service rep assured me that this feature was working properly – as there is no way for the system to know how many people are in the queue. Duh, how dare I expect technology-savvy Amazon to write software that would check the length of the waiting line  before calling me…

She proceeds by telling me that there is no record of my call on Saturday, and that she will reenter an order for a replacement Kindle that will get to me on Friday…no 1 day shipping this time, two days. She also apologized for the inconvenience and offered me a $5 discount on future purchases to make up for it. I choked, asked her whether she really said $5, and when she confirmed I told her that she could keep the generous offer.

So that is the value that Amazon puts on me as a customer: $5.

And I thought I was special.

I have been staking my social reputation for more than a decade on recommending them, I have been sending them thousands of dollars for stuff that I did not always need…$5.

You see, this is what went wrong here, and many companies make that mistake. I wasn’t looking for any compensation. I was just looking for a good old apology. If they wanted to give me something, they could have done it through a gift – like upgrading my 3g so it works in Europe, or sending me a few free books based on my recommendations. I would have been blown away and would have continued to act as an unpaid advertorial for the company. But the minute they put a monetary value on me I switched in a totally different mode. So that is what they think I am worth…$5.

You do not need to pay people to make up for mistakes and you do not need to pay them when they help you…mixing the two is bad business.

For my first CMO 2.0 Influencer Conversation, I spoke with Rob Kozinets, a professor of marketing from York University in Toronto, about communities, consumer tribes and word of mouth marketing – not surprising considering that Rob was the editor of Consumer Tribes, a collection of research papers on consumer tribes, recently finished a book on word of mouth, and is one of the few researchers looking at the practice of business through the eyes of an anthropologist/ethnographer (among other things).

We started the conversation by talking about the disconnect between the world of academics and the world of business, especially as it relates to marketing. It is an unfortunate fact that many mistakes could be avoided if marketers were making informed decisions based in part on some of the recent findings in the fields of behavioral economics, anthropology, complexity theory, sociology, and psychology.

One of Rob’s main themes is that consumer learning, opinions and transmission of influence happens in smaller groups – hence the idea of tribes. Today’s tribes have looser affiliations and are more hedonistic in nature than ancient tribes. They are nomadic by interest, rather than geography, and centered around expertise and commercial culture. Consumer Tribes are also not typically focused on a single brand but rather on a whole group, a whole culture or lifestyle, or a set of activities. Another challenge for marketers, according to Kozinets, is that consumer tribes don’t typically develop long-lasting relationships. Even some of the stronger tribes, like the Star Trek groups that were so popular in the 90′s, aren’t as active anymore – people move on as they get more options. It would actually be interesting to see if the Harley community is still as strong as it used to be. People move in and out of consumer tribes, and the tribes seem to have a natural life and death cycle – including a revival stage sometimes.

Of course, most marketers don’t think of their customers as tribes yet, or don’t realize the enormous impact that successful customer communities can have, so for many of them this is an non-existent problem.

According to Rob, one of the big problems with communities is that companies are setting them us expecting fixed ROI. In reality the measurement of the the impact of communities is very hard. They are hard to set up, take time to take off, and are challenging to maintain. And, as Rob points out, a lot of the successful community marketers have had their communities formed for them by their customers – much like Harley.

We also talked about the proliferation of special interest communities sponsored by various companies – e.g., small business focused communities, of which there are dozens. Obviously members will not want to belong to multiple small business communities, so what then? Consolidation, with most members gravitating towards the most successful small business community, or further fragmentation, with more user-driven communities aggregating around micro objectives? It’s hard to predict where we will see consolidation vs. fragmentation of communities as we do not quite understand how people move in and out of those spaces.

An interesting concept which Rob brought up was “share of community time,” which, in a way, is a measurement related to John Hagel’s Return on Attention (John has also agreed to conduct a CMO 2.0 Influencer conversation with me – stay tuned for a date). The problem with calculating share of community time is that there is a huge spread in the estimated number of people who participate in communities – between 100M and 1b.

Other things we talked about include:

• The role of payments and incentives in communities
• Whether online focus groups are stretching the possibilities of online community environments
• How to engage with your detractors as well as your champions
• How, if you are going to open things up, you should have a strategy to deal with criticism that will come
• The pros and cons of having a neat classification system for communities based on the different needs that they are trying to solve
• How community organizers need to think about members first and brand second

We also touched on word of mouth and how most marketers expect word of mouth to amplify their message, when in reality most word of mouth will transform your message.

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

I’ve decided to take this post down. It was posted in good fun and I’m glad it provided amusement for most all but, upon reflection and a related conversation or two have decided to take it down. I’ve no desire to cause personal pain and as I hope you know do not make a practice of taking posts down.

I am scheduled to travel to Belgium to visit my father who was diagnosed with two aneurisms and is facing a fairly complex and dangerous operation later this month. When he had an aneurism 17 years ago it burst and not only did he almost lose his live – he lost his business.

So I made reservations on Air France to go visit, and when I called my parents today with my itinerary I realized that I had made a mistake. I wanted to come back on the 27th and for some reason when I ordered through airfrance.com they booked me a train from Brussels to Parin on the 27th and a flight on the 28th. Now I order stuff online all the time, and if there is an overnight situation I expect the site to alert me to this. I called Air France, hoping that they would rectify the situation, as I do not want to spend a night around the Paris Airport and also need to be back in the US on the 27th. When I heard that they had plenty of room on the 27th, I thought it would be a no-brainer for them to change my reservation – and was even prepared to pay a fine for what surely was their screwed up user interface. But no, they could not change it – I begged, played nice, tried the empathy card – but the answer was no way, non, merde…you lose your ticket and buy a new one (which I did – but on Air Lingus – hoping the Irish are somewhat better).

Now my family has been using Air France ever since the Belgian Airline went out of business 6 or so years ago.

In these bad economic times, you would expect companies whose service are going to be the first to be cut from personal and business budgets to do everything they can to hold on to their customers – especially if it does not cost them a dime to accommodate the change request which would satisfy the customer, and perhaps make up for their deficient product offering.

I am flabbergasted – but should I? You could blame customer service arrogance, something that the French have been accused of, but in the end it has become an industry-wide behavioral attitude.

How do we customers give them the middle finger?

With every company wanting to jump on the community bandwagon you see some pretty silly things happening these days.

One such funny community is the new P&G Tampax social network (ok, they don’t call it that way), which my partner Lois pointed out to me yesterday. Of course, coming from a company that calls Vocalpoint a community instead of a multi-level marketing effort, or their connect + develop effort a product innovation industry collaboration effort instead of a web-based idea box is not so surprising.

Heck, last week I met a CMO who called his mailing list a community.

And then there are the many people and companies who should set good examples and don’t – Seth Godin with his Tribes community to help him sell books, or various community platform vendors that set up communities in which they try to isolate their members instead of affiliating with one another and show community best practices, are just two examples of that.

Maybe one of these days we should create user-generated lists of best and worst community examples. That would be fun.

The 2008 Tribalization of Business Study that was released last week led a lot of people to conclude that online communities do not work and that companies are spending too much money on making them happen.

Well – there is some of that and then there is a whole other side to the story that we uncovered as part of the study.

Let me use this post to clarify some of the misunderstandings in the interpretations of the business community study results.

Do most online communities indeed fail?

In fact we found many very successful community examples in the companies that participated in the study – many of them well known and well documented case studies, some less so. We should also point out that most communities that were part of the study are less than 1 year old – so we do not really know whether they are successes or failures.

It is true that many communities fail, and will continue to do so. When they do, however, they do so for very similar reasons – so you’d think it should be fairly easy to avoid the pitfalls.

The first reason is that many companies who embark on community initiatives are putting their company or product at the center of the effort. As many pointed out, that is obviously WRONG – you need to put the community member at the center and make sure that there is some passion around the initiative.

Do companies spend too much on Technology?

The second main reason for community failures, and one that got misinterpreted by many, is that companies are starting community initiatives by focusing on the technology first. It’s not that they are spending too much on technology, it’s that the technology platform is not what is going to result in the dynamics of increasing return that characterize successful communities.

Should all companies have community initiatives?

If you can create a place for your customers and prospects to come and share their passion, and that place does not yet exist, then you should absolutely try to have a community initiative. But don’t be blinded by “the not invented here” syndrome – maybe the best way for your company to leverage communities is to go on Facebook, MySpace or some other community that is user controlled, like the Tivo community used to be.

As some pointed out, there is another big reason why companies should always think about affiliating with other communities – and that is that people will only participate in a limited number of communities. I won’t participate in a Bank of America small business community and a Microsoft small business community and maybe a few others – I only have so much bandwidth.

When is $1M too much to spend on a community?

Many jumped on the bandwagon that it is unbelievable for companies to spend $1M on customer communities…[update 07/21 @7:45pm ET - only 6% of the companies who participated in the study spent more than $1M on their communities]

Maybe yes, maybe no…

If you are small startup, then $1M is definitely way too much. If you are a bigger company and spend $1M on designing a slick community with worthless technology bells and whistles, then that is too much to. But as I wrote by using the example of Bank Of America, in some cases companies are not spending enough to make a difference with their online community. If you are a Fortune 50 company with billions of dollars in revenues, and routinely spend multiple millions of dollars on advertising media, then only spending a few hundred thousand dollars or even a million dollars on your community will just not move the needle. And if the goal of everything you do is to create new customers in a way that will make a difference for your company, then you need to invest appropriately.

Now if you are going to spend $1M – you have to make sure that the investments need to be made in content creation, moderation and awareness development (no, I did not say advertising or direct mail ) to support large numbers of users.

Do CMOs get it?

Talk about a loaded question…but since many were quick to dismiss the capabilities of marketers it is one that I thought should be addressed.

And the answer again is – some do, some don’t, and many are trying to figure things out.

Some are indeed looking at communities as another channel through which to interrupt their customers and prospects with product messages – and most of them fail fast and miserably.

Some don’t quite get what they inherited and keep it small and contained so that it does not make it on their radar screen.

And some know that it is transforming their role and giving them a renewed chance to be the key market strategist at the executive table and the representative of the voice of the customer within their company – and those are the ones who are reaping all the gains.

So, again – do most communities fail?

Our study did not show that. But yes, many community initiatives do fail – either because nobody comes (or they come once and then never come again), or because they fail to move the needle for companies and do therefore not receive the executive attention that they deserve. As I said before, the reasons why they fail are very similar from one case to the next and should therefore be avoidable. But there are many case studies where companies delivered game changing results to their company’s bottom line – and the reason why they succeeded are very similar as well.

One of the all time success stories in the gaming world was the Halo series of games for Xbox and Xbox Live. It still puzzles me that the games were rated M (mature) as there are a lot of T (teen) games that have a lot more gore and fighting in it than Halo. At some point I thought it was a clever marketing ploy to make people want the game even more.

Many of us bought the game for our teenage kids, and while I do not have exact numbers, I bet you that a majority of players were teens.

The game keeps evolving through the download of special maps – blueprints for specific game play. If you do not have the latest maps you cannot play games with friends that use them.

All of sudden Microsoft decided to prevent child accounts (less than 18yo) from downloading Halo maps. The only way kids can play the new maps is by starting a new account and lie about their age. That of course wipes out all of their standing in the game – something many kids are very proud of, and which is totally part of their online persona.

That’s not all – apparently Microsoft also decided that Live Messenger is not for teens, so they cannot use that either. I wonder what market research showed that Live Messenger would not be of interest to teens or could potentially be harmful to them…

What are they thinking? Not only are they alienating an audience that is key to their future success, they are also alienating the parents of those teenagers. I like to think that I am in charge of what my son will watch and play with, and that I do not need the help from Microsoft to make that decision for me.

Or is this another example of the tyranny of the minority – where a small group of freakish parents contaminates the well for the rest of us?

[Update 6/11/08 - I wrote the story of how Lenovo Wow'd me and turned me into a loyal customer once again here] 

After spending 7 hours diagnosing my 8 month old Lenovo T60p today, which I bought with next business day on-site service, I found out that the computer’s hard drive is busted. They are sending me a new hard drive, but the image disks needed to rebuild the hard drive will take three days. When I told the technician that they should not sell their service as a next business day service he snapped at me telling me that he was not selling anything – he was just fixing stuff over the phone.

So much for IBM service…

And this is the computer that already had its main board as well as its memory replaced (within a week or so).

In the old days they called this a lemon…

Time for Mac?