Fred Wilson On Marketing

"I believe that marketing is what you do when your product or service sucks or when you make so much profit on every marginal customer that it would be crazy to not spend a bit of that profit acquiring more of them (coke, zynga, bud, viagra)." -- Fred Wilson


Great post.  The real point of the article is that marketing is critical, but you shouldn't be paying someone else to do it.  Thanks for the link Jamey.

http://www.avc.com/a_vc/2011/02/marketing.html

Social Commerce & Group Gifts

Fruitcake
eBay is announcing a new feature called Group Gifts.  The URL doesn't appear to be live yet.  The plan is to use your email and Facebook contacts to drive the interaction.  Social commerce isn't new, but companies might get the user experience right this time.  This is really about bringing workflow to a consumer process.  That can be complicated stuff.  That's why getting the UX is critical.  At the root of the challenge is empowering the organizer and aggregating contributions.  When the organizer is not the receipient there is the additional challenge of picking the right gift in the first place. Facebook may be the perfect place to surface informal gift registries.  Amazon and their wish list feature seems like a better fit than eBay.  Still, I'll be watching how eBay solves the UX challenge.  Especially since they deal with a number of products with a limited sale period and an inventory count of 1.  Someone in the group is bound to be lazy and let the auction expire.  Anyone thinking of buying me a group gift -- please, no fruit cake.

Update: Here's the correct URL - http://groupgifts.ebay.com/

I Heard They Hate Puppies (My Apple iPad Post)

S2MQRA6DGSNZ So there it is. The Apple iPad is out and we can start speculating about something else. As a marketer, the most fascinating thing I found around the iPad hype cycle was the user comments on tech blogs. From the initial press it does look like the general consensus is that the iPad is underwhelming. However, I'm not sure what could have lived up to that hype train. More interesting is that most of these people ranting on the tech blogs weren't going to buy this thing anyway - whatever it turned out to be. Period. A common conversation has gone something like this.
  • knucklehead: First!
  • gadgetboy: The apple ipad rockzzzz!
  • gpl1989: Too bad it doesn't have 3G.
  • gadgetboy: it does have 3g
  • gpl1989: Yeah, but too bad it only works on AT&T's crappy network. Massive FAIL!
  • gadgetboy: it comes unlocked
  • gpl1989: Too bad it doesn't have dual cameras, thinner bezel, regular SIM card, run Flash, multi-task, have a removable battery, faster processor, do HDMI out, run OSX/Ubuntu/Win7, fly to Mars and cost $99.
  • gadgetboy: huh? how could they make $$$ doing that?
  • gpl1989: They could if those corporate suits weren't so greedy!
  • knucklehead: At least it won't RROD like the Xbox.
  • gadgetboy: well, i'm still going to get one
  • gpl1989: Go ahead and buy one if you can live with that on your conscience.
  • gadgetboy: huh?
  • gpl1989: Yeah, I heard they hate puppies!
What? Exactly. That guy was never a potential customer. He's full of excuses and just came to talk. He's not even the "just looking" person in a retail store. This guy convinced himself that he doesn't need your product and his ego isn't going to let you change that. That's fine. We just need to a better job at ignoring him in the first place. This is one of the skills that digital marketers are going to need. Who should they ignore? Who should they double down on? The answer is a moving target, but critical for those on a quest to increase profitability and keep the right customers happy. And oh, I personally don't hate puppies. Cats on the other hand... The Bottom Line: Many times people look for a reason not to buy your product. Ignore them if they're not worth the trouble.

Sent From My iPhone

I've received a number of emails recently from people on their smartphones. Many have signatures that say things like 'Sent from my iPhone' or whatever phone they're using. That's fine if you think it's cool to let everyone know you have an iPhone. I get that. Frankly that's why many people buy Apple products. Individuals tout ease of use and beautiful industrial design as key reasons for buying an iPhone or MacBook Pro. Valid traits, but many aren't fessing up to their additional desire to tote a status symbol. Apple delivers on that status in exchange for a premium price. The combined value from the UX, industrial design and status (regardless of each customer's personal mix on the three) is what Apple customers are happy to pay for. But this post isn't about status. It's about promotion and opportunity cost. When you send out an email that says 'Sent from my iPhone' you are proclaiming your status. That's fine. But there's an opportunity cost. What else could your email signature say? What do you care more about that might be worth attaching to every email you send from your phone? Each email is opportunity to plug your personal brand, your product/company/blog, a nonprofit organization you believe in - lots of things. That signature is valuable real estate, and you should use it wisely. Plus, it takes less than two minutes to change the email signature on your phone. If you have something more important to say in that space - say it. Especially if the phone maker is only paying you in status. Bottom Line: Don't wear the t-shirt for free.

Here Come The Lists

Data comes at us from all directions. It can be hard to make sense of it all. So we filter. We ignore. We categorize. We love to group things. It helps us make sense of the world. It happens at work and in our personal lives. While grouping isn't always a good thing (e.g. stereotypes) it's a key skill for us to acquire. It's not just a human skill. Servers running highly tuned algorithms also help us out here (e.g. Google, Bing). All in all, it's not surprising that we spend a fair amount of time managing information overload. There's a lot of data to process. As the year comes to a close the lists emerge. The 'Top 10' list is one of the most popular. And hate them or love them, most people can't get enough of them. Why? All the reasons above. You might not be much of a sports fan, but you'll watch ESPN's top ten sports moments of the year. You might violently disagree with a film critic's top movies of the year, but that's sort of the point. These lists give us a starting point to identify with what we like and what turns us off. As marketers we can create lists to get our customers attention. But you have to make them interesting. I was going to add a list to this post, but nothing came to mind (that wouldn't take some time to compile). So no (interesting) list from me. But that's okay. You don't really need mine. The lists are coming. Happy Holidays

Ad Targeting: We Can Do Better

I was looking for a deck on Personal Data Networks. That I didn't find anything interesting is another story. Mental note to blog on that later. Anyway, I found it odd that a Timbaland ad was displayed on a site like SlideShare.net. It doesn't fit. And the fact the keywords 'personal data networks' surfaced that ad is a broken experience. Yes, the ad is part of the experience. I played around with different search terms and it appeared anything with the word 'personal' in it trigger more consumer-related ads. The word 'networks' leaned more toward social network ads vs. computer networks. Now maybe some cookie on my browser linked me to others sites I had recently visited. But I don't think so. I dump my cache regularly and surf from a proxy. There typically isn't a lot of super targeted display inventory. Text ads are quite the opposite, and is part of why they scale so well. But I don't care. For me, relevant and contextual ads equals good. Audience segmentation generalized to this point? Worthless. The guys at Interscope (or whoever manages Timbalands online marketing) need to have a talk with their media buyer. But this isn't all on them. The technologies that enable better targeting need to improve. And consumers need to embrace permission marketing to complete the circle. I'm hopeful, but not holding my breath. Bottom Line: Advertisers and technology companies - you guys can do better.
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George Clooney vs. Tiger Woods

A promise is a big deal. Break one and bad things can happen. Namely people may lose trust in you. I heard a great definition of trust a while back. I'm paraphrasing, but the gist was that people trust you when they can predict your behavior. Good or bad. So yes, you can even trust an evil person to be evil. It is critical for brands to establish trust with their audience. That's core to the brand promise. Without that trust it's almost impossible to build loyalty. The media circus surrounding Tiger Woods got me to thinking about how this affects real-world brands. Tiger sold people on his focus, motivation, discipline and dedication. This combination pulled in non-golf fans who shared his values and/or were simply intrigued by his consistency. And then he let people down. He's lost the trust of many fans and supporters. Sponsors like Gatorade and TAG have been the first to pull back. I expect others will follow suit. All is not lost. Tiger the brand can still thrive, but it will need to be repositioned. Proof point? Kobe Bryant. The thing that most intrigues me with the Tiger story is that he could have avoided it all. If he never got married in the first place, this would be a non-story. He'd just be perceived as a playboy. Fans may not have shared those values, but his actions wouldn't have evoked such strong reactions. Some would argue he would be less valuable as a brand without the family values attached. I would counter that brands should be true to the values they can sustain, not those that may generate the most revenue. The reason is simple. We'll screw up at some point if we try to fake it. And if Tiger knew he was this way he should have stayed single. Tiger should have pulled a George Clooney. We trust George to be George - the perpetual bachelor who dates hot women. As a result, there's no fanfare when he shows up with his newest girlfriend. You may not agree with this lifestyle, but his consistency is something we can learn from. The Bottom Line: Figure out who you want to be and then make sure you don't promise your customers something you can't deliver.

Why Crowdsourcing Works

There's lots of talk about crowdsourcing these days. IMO, crowdsourcing works when the contributor believes they have excess capacity (e.g. time, brain processing cycles) AND will receive some sort of non-monetary compensation (e.g. recognition, purpose). The formula that makes this work for many is perceived capacity (under) utilization plus (low) opportunity cost plus a belief in the project. Contributors (many of them PhDs) in a recent Netflix-sponsored contest participated in a crowdsourcing project to help Netflix improve their rating system. In the end it was estimated that Netflix paid $0.10 per hour for the research they collected. So why would these contributors participate in this contest? Surely their time is worth more than $0.10 per hour. Right? The contributors may have felt that the non-monetary compensation (and potential prize) was worth the excess capacity they weren’t going to use in the first place. To that end, businesses/organizations who want to leverage crowdsourcing should focus on audience segments that believe they have a lot of excess capacity and/or place a high value on the non-monetary compensation that the business can deliver. Plus they have to believe in what you're peddling.