The journey of this post starts here: “Business Intelligence Meets BPM: Using Data to Change Business Processes on the Fly” by Kim S. Nash (CIO.com, 17 June 2010). On one hand this is fascinating stuff — collecting data, analyzing it and distilling information that objectively drives business action. The business side of my brain goes, “Wow!” But then reality sets in and that, “Wow” turns to, “Wow, scary.” This freight takes two forms:

1) The private person in me shutters to think that Big Brother is not only watching but he’s storing, tracking, cross referencing and analyzing too. This is taking place at and unimaginable level of granularity.

2) The business side of my brain also appreciates the fact that Guests are people. They are not just data points on a graph or cells in a spreadsheet. Analysis is certainly essential but one would bet there are plenty of companies over-valuing this new found power. They are forgetting that they are in business to serve people, not just respond to ones and zeros. As a matter of fact, read this article first: “Superhighway to Hell” by Stephen Saunders (InformationWeek.com via InternetEvolution.com, 19 June 2010).

Back to the first article by Kim Nash. There are some bits to this article (pull out of the context of the whole article) that beg to be addressed AU style:

As Kilcoyne and Coyne learned, modern business intelligence and analytics tools can extract data from enterprise software, populate pre-built statistical models and quickly produce insights that used to take weeks. “In the past, doing predictive analytics needed a PhD in statistics to build a model and interpret results,” says Aberdeen’s White. But newer analytics tools “hide the underlying statistical nerd details,” he says. “Business people don’t have to worry about how the sausage gets made.”

One word: Derivatives. No one needed to understand those either, correct? Information is only as good as the understanding the business people have of the data that was used to compile it. A report without caveats and context is no report at all. If BI is about removing assumption then that thoroughness should be part of the end to end approach.

Key to game-changing decision making is the ability to detect and respond to market changes, taking into account historical knowledge. DirecTV uses analytics to save customers who want to cancel their television service. The company started the program two years ago when it sought to cut churn rates.

What’s interesting is that the examples sited are all reactive. There is some action and then analysis is used to define the appropriate way to respond. Maybe this should be supplemented with a proactive approach as well? That is, avoid upfront engaging customers who don’t meet the good customer profile. For example, for a fitness club, membership retention would be less of an issue if the right customers were attracted in the first place. Waiting to see who leaves seems archaic, no?

How hard agents press depends on how valuable the customer has been to DirecTV, Gustafson says. “There are some people we just do not want to lose.” About 60 percent of customers who want to depart are deemed worth trying to save, he says. The company uses tools from Teradata and SAS to analyze past behavior, evaluating data such as the average annual revenue the customer represents, her payment history and how many pay-per-view shows she buys.

This is a perfect example of forgetting that we’re dealing with real people here. Maybe I am a marginal customer. But if I have 500 Facebook friends and 1,000 Twitter follows then that should be a factor too. To simply place a value on an account (notice I did not say guest or customer) is at best dangerous if the evaluation is this superficial.

Every customer saved is one less customer the company has to try to win back weeks or months later—an expensive process, Gustafson says, that can involve mailings, e-mail and telephone calls as well as sending someone out to reinstall the service. “When the customer first calls, they have a certain mind-set: They want to cancel,” he says. “When we call back, they’re unprepared. It’s a little psychological advantage we have.”

Oh no he didn’t! Forgive me if this sounds insulting but only an idiot would go on record saying such a thing. But again, Mr. Gustafson’s statement is another example of forgetting that guests are real people, not rats to be manipulated.

Now, though, the My Coke Rewards program has helped the company develop more in-depth knowledge about loyal customers. The inside of every bottle cap is printed with a 12-digit code that customers can text or type into a website or desktop widget to accumulate points that can be exchanged for prizes and other awards. Those who opt in to e-mail marketing receive regular offers to gain more points, as well as other marketing pitches. Each is customized based on segments created from demographic information and behavior collected by the site. On average, 285,000 customers visit per day, entering an average of seven codes per second. Information embedded in the codes may include a region or location where the bottle was sold and whether it had special packaging, such as an Olympics logo, that Coca-Cola uses to tailor its pitches.

Read that again… It’s not a 12 digit number, it’s a code. In other words, you can’t drink a soda in peace without wondering when and how Coca-Cola is going to watch you. Scary, right?

After four years, My Coke Rewards is among the longest-running marketing programs in Coca-Cola’s history. And as the program has grown, the company has changed the way it runs in response to insight from analytics, Rollins says.

First, of all the programs Coke has ever had four years constitutes “among the longest-running”? MyGawd, has their marketing department been thinking or just rolling the dice and hoping to find something that sticks. Must be nice to have that type of budget. Furthermore, this reads as if they are responding to analysis, not guests. Not good.

Coca-Cola uses the FICO Precision Marketing Manager suite of statistical analysis tools to study data from its websites. Marketers look at which come-ons elicit the most and best responses, says Thomas Stubbs, Coca-Cola’s interactive marketing director in global IT. Coca-Cola also exchanges data with companies that supply prizes, including Nascar, Nike (NKE) and Sony. “As technology has evolved, we’re able to do more and have a relevant dialog with customers, not just push our ideas out there,” he says.

“A man might not want to admit that he’s a Diet Coke drinker. He will say in a survey that he prefers Coke. But we see he enters only Diet Coke PINs and market accordingly.”

Danger Will Robinson! While it’s true that Coca-Cola might want to know more about who consumes their products, Coke is treading on thin ice if they believe that their definition of the guest is better than the guest’s himself/herself. Do such details constitute useful information? Yes, of course. Might they also be making over-confident decision, and possibly insulting the guest? Yes, that’s very true too.

The idea is not just to save business but to create new business. Successful projects spark new ones. Analytics tools help companies create more money-generating interactions with customers and shave costs from internal operations. CIOs should connect analytics technologies with ideas about refining business processes, says Aberdeen’s White. “Meld them together and that’s very powerful.”

Bottom line… it’s about The Guests, not data and analysis. This shouldn’t be about “refining business process” but about improving The Guest Experience. Same ends? Maybe (but probably not). Different means? Yes, very different means. One puts The Guest first and one does not. If you could analyze the two approaches which would you bet to be the winner? Of the companies you deal with which try to improve The Guest Experience and which are more concerned about their processes and their bottom line?

And finally, to help get it all back into perspective: “It’s Not Your Relationship to Manage” by Lauren McKay (CRM Magazine via DestinationCRM.com, May 2010).

“Are We Ready to Play With Pay? The Content Value Reproposition” by Steve Smith (EContent Magazine, April 2010). As the internet allowed islands of content to drift together, the cost of being an info consuming traveler  fell, drastically. Aside from the benefit of no more dead trees, it doesn’t get any cheaper than free, does it? But now what? How are content providers supposed to survive on a business model based on free?

In the end, Steve’s article inspired the letter below. The stellar news is, the editors of EContent printed it in the July/August 2010 issue. It’s always nice to see the AU State of Mind get more love. Enjoy!

Hello Steve

I just wanted to take a moment and mention that I thought your article was very well done. However, there are two things that I would like to mention:

1) I was surprised you did not make mention of iTunes. About the only thing more ubiquitous than music is air. That said, the general belief is the content (i.e., music) is the loss leader and ol’ Steve J. & Co make their money on the hardware. Maybe “value add” is the model to follow? That is, content providers don’t just publish, but consult, host seminars, etc.

2) Early on you wrote, ” Traditional media made their ad models work because they controlled both the supply and distribution of content around a limited set of brands.” I’m not so sure this is as accurate as it could be. The advantage traditional media once held was for the most part based on production and distribution. Supply had little to do with their advantage. It was the barriers to entry (read: cost) that sustained that biz model. The People have always been willing to self-express and self-publish. It wasn’t until the early 90’s with desktop publishing software and relatively
lost cost copies from Kinko’s did that really become feasible and “mainstream” (in an underground, not quite mass market ‘zine sorta way). Today, even outside of the internet, digital printing is getting
more and more reasonable. And then there’s something like MagCloud that uses the advantages of the internet to let people self publish on demand. In short, the content has always been there.

One step further, I would argue that this is somewhat the problem with traditional media. They are under the belief they were in the content biz. They were not. The reality is, they were in the production
and distribution biz with much of their “content” coming from wire services or just regurgitating the details of events. Today, I would bet for most ball games I can get play by play via Twitter. So why watch the 11 o’clock news? Let alone read the morning paper? Those mediums are slow and costly.

Again, for the most part they have not been “creating” content, just moving it around.

Thanks again for the article.

Mark Simchock
Chief Alchemist
Alchemy United

“Fifa acts after ‘ambush marketing’ by Dutch brewery” by BBC News (news.BBC.co.uk, 15 June 2010). Being a lover of The Beautiful Game, this off the pitch sideshow is worth mentioning.

Internationally televised or not, if the Budweiser brand is fearful of three dozen women in orange dresses then there is something significantly wrong with Bud’s marketing efforts. In raising the issue to the legal level, FIFA and Anheuser Busch have probably played to Bavaria’s hand and have given the tiny Bavaria the even higher profile they were seeking. Haven’t we’ve seen this tactic before? Are FIFA and A.B. that naive?

Finally, as the anti mega-corporation climate continue to grow amount consumers, Buds excessive counter attack against the underdog Bavaria in all likelihood risks additional push back against the Bud brand, as well as the Anheuser Busch family of brands. Worth it? Probably not. What’s next, supporters being banned for wearing their squads’ colours because a sponsor doesn’t like that colour?

For violation of the spirit of the game, “The King of Beers”  should be sent off.

What do you think? Is FIFA and A.B. acting in their own best interests, or looking to be a social media victim of their own 20th century mindset?

“6 Ways to Fix the NBA” by Stephen Fried (Parade.com, 20 June 2010). As luck (?) would have it, this article managed to come my way via Google Alerts. And yes, sports as an analogy for business is overdone. None the less there are some interesting observation here that apply to incentives, as well as cause and effect gone astray.

Here is a version of the comment that was submitted:

Dear Parade,

I read the six recommendations on improving the appeal of the NBA and would like to comment. My thoughts are as follows:

1) Change foul out rules — While it’s true people wish to see the star players, no one comes to see fouls either. In any sport fouls are the “ugly” side of the game. I find it hand to believe that what ultimately comes down to more fouls is going to be appealing for the fan. Is there any prescient for ugliness increasing a fan base of any sport?

2) Increase scoring — I would like to suggest there are two flaws here. One, accelerating scoring will only accelerate the gap in two mismatched teams. Does the NBA really need more blow outs? Two, it’s supposed to be a game and sport, the tit-for-tat approach of focusing on scoring is going to wear thin very fast. One could argue it’s the perceived (?) lack of strategy is actually what’s hurting the NBA today. Pass… Pass… Dunk. Followed by pass… Shoot… gets dull after a while. We know they can score, the question is, do they have game?

That said, an interesting idea might be just giving the team that’s leading less time to shoot? Or the team that’s down more time so they control the pace, can readjust, etc.

3) Raise the age limit — Again, two flaws. One, what if the stars-to-be opts out of the college route and decide to play in Europe instead. Two, does this not confirm the criticism that many already make about college basketball? That is, it’s not about education, sport and developing students into citizen, but instead it’s just the minor leagues for the NBA.

4) Encourage quirk — Ha! In this day and age?? Even at 140 characters Twitter is enough for some of these guys to hurt themselves and ruin their careers. In a society that expects perfection this recommendation is just an accident ready to happen. Furthermore, just because they are great athletes does mean they have “personality”. What’s does shooting a basketball have to do with anything other than that? Yes, let them be who they are. Just consider the classic, “Be careful what you wish for”.

5) Change the trade rules — Truth be told, there is already collusion between the agents and the front offices. The free market will be great as long as there is a way to ensure it is remains a free market.

6) Shortern the season — Finally something that makes sense. And please suggest the same for baseball and hockey too. The NFL has it right, as does European football (aka soccer). The irony here is this is a call for quality, yet more (read: quantity) scoring was recommended earlier.

The bottom line… More fans will pay attention when the NBA, or any brand for that matter, becomes a better entertainment value than other choices fans might already have. I’m not so sure most of the six recommendation listed really workt towards that goal. That is to consistently entertain to a level that exceeds expectations.

Thanks for listening.

Mark

p.s. I thought it was interesting that the woman’s league was not mentioned. It very well could be that the WNBA is cannibalizing fans from the NBA. Maybe this is because in the WNBA it ismore about “game” than about size, or should I say size of egos?Btw, when was the last time a fan got beat up at a WNBA game?

“On My Mind: Measuring Good-Cause Effects” by Raymond Fisman (Forbes, 10 December 2009). As the holidays get closer and resolutions are being made for 2010, doing well by doing good is probably on quite a few to-do lists. If that sounds like you, then give Mr. Fisman a few minutes of your time, please.

Now before you jump to conclusions, there is one bit (in the third from last paragraph) that is not fully explored but seems rather intriguing:

Interestingly, in the months after Hurricane Katrina made landfall in August 2005, there was a big boost in sales probability and price from Giving Works for all Ebay sellers, young and old. So, when a national spotlight shines on particular causes, it may be possible to do well by doing good.

Possible conclusion? Be specific, and possibly current, about the cause you’re supporting. Just saying, “we do good” and “a percentage of sales goes to charity” might not be enough. Makes sense since most people would want to know exactly where their money is going. Don’t you prefer clarity and transparency over vague and mysterious?

“Furnishing Higher Profits – Business Intelligence: How Analyzing ERP Data Helped a Retailer to Get More Value from Suppliers” by Kim S. Nash (CIO.com, 28 October 2009). Today seems like a great day for KISS so let’s just get to the bottom line.

BI (business intelligence) is great but even the less enabled don’t need such a heavy duty investment to benefit from the takeaways of this article. Keep in mind:

— There is more to cost than the number on the price tag.
— You get what you pay for.
— When you’re the seller (and not the buyer) be sure to communicate the holistic value you provide for the fee you charge.

Done! Enjoy!! Pass it on…

“Makeover: Scoot Richmond – No Free Rides” by Phaedra Hise (Fortune Small Business, November 2009). As you’ve followed this blog you’ve probably come to realize that FSB’s Makeover feature is very often an engaging read. The review of this Richmond, Virginia’s scooter business is worth a go.

For what it’s worth, here are the AU caveats as emailed to Ms. Chelsea Lahmers, Scoot Richmond’s owner.

Hello Chelsea,

I just finished reading/skimming the article in FSB on Scoot Richmond. Kudos to you for stepping forward and looking for new ideas. In my previous life, I too was the owner of a retail business. I certainly understand how difficult it can be to juggle the day to day details and try to be open minded and forward thinking at the same time.

I have some thoughts as based on that article. Unfortunately, I’m running late for a meeting with a client so please accept this “rapid fire” style. I’m not trying to be blunt. I’m not trying to be critic. I’m just once again a bit pressed for time. Please forgive me.

I will preface my input with one presumption – I realize the article is not everything that was discussed, etc. The article is however all I am able to go on. Please accept my thoughts knowing the limitation of my perspective.

— Rather than waste your time going to the police station, contact your bank or whoever does your credit card processing and ask them what they offer in terms of check protection. For example, as I understand it, Heartland Payment Systems offers a (hardware/software) solution that mitigates the risk of bad checks. It might even eliminate it.

— Maybe he was misquoted but Mr. Wilson’s suggestion to “interview each candidate several times…” was (for me) almost comical. Yes, I agree with “prevention” but will you be getting the best candidates, or just the ones willing to jump over your hurdles. Moi? I like the birds of a feather rule. That is, ask your current (or former) employees and then from there ask your customers. Also be attentive of when you shop elsewhere, maybe you can steal someone else’s good employee?

— Speaking of asking your customers, it always amazes me how many of these FSB Makeover articles never recommend speaking with the customer. Maybe that’s stating the obvious but maybe it’s not? When someone buys a new scooter, do they get a follow up phone call? What about a new service cusotmer? Do you have a suggestion box? Maybe “Suggestion of the Month” get a free oil change? This is the Web 2.0 age and whether online or off people have thoughts and they want to share them. Try to live up to that expectation/reality. Yes, I know it’s easier said than done but try we must.

— Speaking of web sites, IMHO, you might want to consider a make over. I would have never guessed you were doing $1.1m by the look of your site. I like the idea but it’s not “tight”. If you’re interested in discussing such a project just let us know. We’d like to submit a proposal.

— The best way for me to describe my reaction to Ms. Angstadt’s recommendation is, “Be careful what you wish for.” If the incentive is to do something quicker then trust me, it will get done quicker. But is that really what you want? More importantly. is that what the customer wants? Will quicker still mean 100% right? That said,  what is the cost of that (say) 5% error? If you’re going to offer incentives then be 250% positive they are (what we call) guest-centric. If they’re not, then expect the worse. Try the Harvard Business Review site web for insights on incentives. The ones recommended seem counter productive.

— Also, I would not recommend looking at your books in that way *too closely*. Do you need to watch the numbers? Of course you do. In the current climate we all do. But being the size that you are then I would favor a more holistic approach. For example, if using an oil change as a loss leader inspires more sales of scooters then is that a bad thing? Much like Mr. Wilson, Ms. Angstadt’s “the store should sell the oil to the repair shop…”, seems a bit out of touch. In theory, the idea is cute but it’s not going to happen – especially if a customer is waiting. Especially if the incenttive is to get it done faster. Such a transaction is just not practical on a day to day basis, is it? Maybe checking inventory and shifting whole cases might make sense but even that probably isn’t worth the time.

— If you going to watch the numbers then do some research and try to benchmark against your industry and/or your peers. If you’re strictly focused on your own numbers you might end up “grabbing the balloon”. That is, squeeze one end and it pops out elsewhere. In other words, drive up margins and profit can in fact drop. Small biz is about cash flow, service and long term repeat relationships. Margins will take care of themselves if you’re making people happy.

Not to worry, I’m almost done…

— I agree, VCU students sound like a great market for customers and possibly part-time employees. But did Ms. Cantrell really say “target them with a flyer”? Don’t get me wrong. I will be the first to say that print is not dead. But is that really the best medium for Gen ______ ? (Sorry, I don’t know the current buzz phrase of the current college generation.)

— Also,  “Buying ads in a newletters…” also sounds not very 2010. I have a couple of clients who spend quite a bit of money on print ads and unless you’re targeting the (age) 50 & up crowd, I strongly suggest you rethink that strategy. In fact, you might have the option to position the scooter as being “green” – and not being in print ads might be a statement in and of itself, eh? Hand out some t-shirts, etc. But unless more than a couple customers recommend a print publication thentry to avoid them. Naturally, as I’m sure you already know, avoid one-off ads at all costs. Lighting flashes very rarely produce cost justifiable results.

— The donate / non-profit idea is great! Never a bad thing!! Supporting them is also probably the one exception to the No One-offs rule.

— Finally, with regards to the guy you sent home late. (1) Unless he was specifically told that late = home with no pay then that was a pretty big no-no. (2) If that was his first time, then it was an even bigger no no. “Punishment” like that might come back to bite you in the butt. Do I think there needs to be expecations? Yes, I agree with you there. But much like incentives, be careful what you wish for. You’re Scoot Richmond, not Ford Motor Company. Think “team”. Not “I’m going to get you”.

Hope I helped. Please let me know if you have any questions, etc.

Good luck,
Mark Simchock
Chief Alchemist
Alchemy United
Princeton, NJ

Alright then, anyone else have any thoughts on this article, Scoot Richmond or even the AU feedback? Please take a moment and share it.

“Apple The Outlier” by Rich Karlgaard (Forbes.com, 21 October 2009). In response to Mr. Kalgaard’s blog post the following comment (below) was submitted. Maybe you’ll find it entertaining, so it’s also being shared here.

While I didn’t read every comment in detail, with all due respect, I think the essential point has been missed… When it has been more successful, Apple has been the tortoise. There are plenty of cases of Apple and/or Jobs falling on their face. How many of you are using a Next computer :)

On the other hand, where Apple has done really well, is when it slows down while others rush in. The ipod and the iphone both being great examples. Neither were new ideas. What they were were still developing ideas done a bit better and more importantly, rolled out *after* “the tipping point”. Apple doesn’t feel the need to be first to market, they’d rather get it more right their first time. They’ve come to realize the value in learning from others’ mistakes.  If there is an irony, it’s that Apple really isn’t a technolgy company (i.e., technology for technology’s sake). They understand that they are a solutions and services company, and that’s what they focus on providing.

When they get it right, Apple doesn’t waste resources trying to get to the tipping point, they let others do their bidding. In the meantime they’re using their resources (time and people) to build a better mouse trap as well as come up with the marketing spin to make it look new and exciting. I am not trying to belittle the iphone, I am only suggesting it is not the cure for cancer.

There is no doubt, Apple is a great outfit. But the reasons for that success are too often wrong and/or overstated. They have a great formula – look how their growth and market share has nudged up year by year (i.e., like a tortoise) – and at the moment it’s working quite well for them. But a smart competitor could duplicate their formula quite easily. Provided that competitor isn’t blinded by the hype, or fearful of a beast that isn’t even there.

“The Dangers of Bad Data” by Vik Torpunuri (CRM Magazine, 1 Oct 2009)

“You Are What You Measure” by Lior Arussy (CRM Magazine, 1 Oct 2009)

“Goals Gone Wild” by Stephanie Overby (CIO Magazine, 15 September 2009)

No one will deny that setting goals and measuring progress are important. What’s even more important is setting the right goals, using the right measurements to determine progress, making sure the data is accurate and complete, and then how those measurements are used to manage the initiative.

For example, Google’s AdWords preaches the value of Click Through Rate (CTR), as well as cost per click (CPC). While both are helpful and should be monitored, they are both in many instances the wrong measurement. The better measurement is conversations as well as what Google Analytics calls goals. In theory you can have a great CRT and CPC for one campaign, but another campaign can have a lower CTR and a higher CPC but lead to more or better conversions. It’s an issue of quality verse quantity.

It should be noted that Google only gets paid for clicks not for conversions. So much for “Don’t be evil”, eh? Also, the next time some SEM “expert” starts praising himself/herself about CTR and CPC ask them about their conversion rate. Ask them about the impact their efforts were able to make on the bottom line. CTR and CPC isn’t enough and don’t let anyone tell you otherwise. Success is much more holistic than that.

Another example, is a call center. We’ve all phoned an 800 number looking for help with an issue only to get bounced from rep to rep to rep. Guess what? In that call center lenght of call probably factors into a rep’s review. Should length of call be measured? Yes, it should be. Should it be used to alter behavior of the reps in such a way that it compromises the relationship with the guest? Probably not.

The bottom line is this… measurement is important. Just be careful that you’re doing it right. And always question numbers and graphs when they are presented to you. Never assume that the messenger is right and is telling you what you really need to know.

“T-Shirt Premium Jazzes Up Public Radio Fundraising” by Michele Donohue and Mark Hrywna (The NonProfit Times, 15 September 2009). Good stuff. Who doesn’t love a success story? And a premium? But as you read this please keep these AU caveats in mind:

— Why was the KCSM-FM promotion only offered to “lapsed” members?

— The article says that there was over $42k raised from 577 donors with an average gift of over $100. Simply put, that math doesn’t add up.

— There is not mention of a control group for the KCSM-FM promotion. And while the results sound impressive, the true effectiveness is impossible to analyze. Maybe it just a better looking mail piece?

— While the fulfillment vendor isn’t specifically mentioned, AU wonders if Zazzle.com (or a similar service) might have been a better, more cost effective choice.

— Since when are mailing labels considered a premium?

Last but not least, maybe the concept of donor should be put to rest already? To a certain extent,  donor implies a sense of one-and-done. However, member and membership not only gives the guest a sense of belonging to a community but it should also force the NPO to not see every warm body as a dollar sign. Perception and words matter.  Needless to say, donor, in a world where expectations are formed by Web 2.0 does not inspire an appropriate “UX” (user experience).

“Inspire Your Customers” by Jim Champy (Baseline Magazine, 24 September 2009)

“Keeping Employees Engaged in Tough Times” by Corinne Bernstein (Baseline Magazine, 24 September 2009)

Inspire? Engage? Same thing, right? Actually, right! People are people and both customers and employees are guests. They should all be thought of as such. Employees want inspired customers. Customers want engaged employees. Join in the conversation and go make it happen. Alright!

“Courting a Wary Customer” by Sid Liebenson (Deliver Magazine, July 2009). In case you’re not already aware, Deliver is published by USPS. Natrually, it tends to be biased towards the usage of direct mail or other pro-USPS mediums. None the less, there are often pearls of wisdom worth consuming. Unfortunately, Mr. Liebenson’s article is going to be used as a poster child for don’t believe everything you read on the internet. Please pardon the dip into what might be perceived as the negativity pool.

Below is the letter inspired by Sid’s article. I’d like to add that while the overall tone is somewhat off-centre, my intention was not to bully him. There just some obvious holes in this conclusions. I’d also like to mention that in the letter I describe myself as a “punk-ass kid”, which is hardly the case. The phrase was just used for dramatic effect, if not comic relief.

Hello Sid,

As you can see I felll a bit behind on my reading. I just read your article and found it inspiring and enjoyable. Thanks for taking the time to share with the rest of us.

Let me cut to the chase…

I realize you’re the high flyin’, swashbucklin’ marketing exec and I’m just a punk-ass kid trying to grow up to be you :) but there were two points in your article that I would hope you can take a moment and clarify for me. Btw, please pardon my tone if it comes off as a bit “East Coast” but I’m just a straight shooter. I do not mean to offend. In fact, I’m hoping you see the humor in the delivery.

– One –

You said: Your marketing messages need to be not only personalized, but frequent. In a tough economy, it’s common for consumers to question where every penny is going. When they do that, suddenly every relationship is a little at risk. Their question becomes “Am I really getting value from this relationship, or is there something that will satisfy my needs equally for less money?”

— Pardon me for asking but it’s not clear to me how frequency answers that question. More often is not an answer, at least not to the question you suggest they are asking. In fact, if said organization is not delivering value then it’s likely that frequency will only remind the customer of the (failed?) relationship and the brands inability to understand and in turn satisfy them.

If your question is *the* question then it would seem to me that the focus should be on actually delivering value that satisfies and not just delivering more marketing spin more often. Sorry, but I don’t think it’s safe to assume that every company has it’s “stuff” together and should just repeat marketing formula X more often. Maybe it’s just me? It would seem to me that your recommendation might actually be doing quite a few (of those in denials of their flaws) a disservice.

– Two –

You said: From April 2008 to August 2008, there were more than 83,000 visits and 2,357 messages left on the site. This clearly shows the effects of empathizing with consumers.

With all due respect Sid, no that does not clearly show empathizing. It’s a simple statistic – nothing more, nothing less. Now if you supported that conclusion with “as compared to a control group” or made reference to some sort of follow up interview then that stat might hold some water.

As it is, 2,357 out of the universe of all BCBSF customers (or potential customers) doesn’t sound like much of a sample to me. Can it help? I’m sure it can. But a sub 3% “response rate” as a ratio of visits (btw, is that unique visits or just visits?) really isn’t very meaningful. Don’t get me wrong, it sounds like the client was pleased. It’s just not clear to me how the stat you mention translates into some conclusion about empathy.  Frankly, I’m a bit disappointed that someone who should know better tried to pull the wool over our eyes with some old media-esque broad brushed spin.

Again, I hope it did not offend. I look forward to your reply.

Mark Simchock
Chief Alchemist
Alchemy United

Btw, this letter was sent earlier in the week and Sid has yet to reply.

“Wikipedia to Limit Changes to Articles on People” by Noam Cohen (New York Times, 24 August 2009). A subtle but noteworthy tweak in approach. It’s as if to say the people are always right except when they’re not. Interesting, eh? What do you think?

“What Data Mining Can and Can’t Do” by Allan E. Alter (CIO Insight Magazine, June 2007) The subject of business intelligence (BI) came up in a meeting a couple days ago. The discussion centered around using broad patterns, as well as past behaviors of individuals to make future predictions. This article isn’t new but given the authority of Mr. Peter Fader (who is the interviewee) it will help you properly wrap your mind around this topic.

In short, there seems to be a fair amount misunderstanding when it comes to BI. Well, at least Prof. Fader thinks so.

“Coke’s RFID-Based Dispensers Redefine Business Intelligence” by Mary Hayes Weier (Information Week, 8 June 2009) Don’t let the geeky title scare you. Put yourself in the shoes of a Coke guest and read between the lines. This a perfect example of the shift in expectations that’s being driven by the empowerment guest now enjoy as a result of “technology”. Offline or online is not important. What is important is the experience. As much we hate to tip our hats to high frutose corn syrup & water, Kudos to Coke for this effort.

Our guess is that eventually Coke will link all the machines so that instead of having to reenter your custom flavour everytime you’ll be able to enter your own code and the Freestyle machine / network will take care of the rest. There’s also the possiblity of integrating the machines with a web site (or social network widget) and letting people share their custom flavours. Similar to Abobe’s Kuler (http://kular.adobe.com) but slightly  different.

“The New New Economy: More Startups, Fewer Giants, Infinite Opportunity” by Chris Anderson (Wired Magazine, June 2009) If you’re trying to make sense of what has happen and of what’s to come Mr. Anderson sheds some valuable light on the matter. As expected, there are two AU caveats:
1) Capital was traditionally only available to fairly large companies. The internet changed that. Investors can not only move money quicker and easier, they now have a tool for mitigating risk by providing a better way to identify and evaluate the smaller companies with the potential to be the next big thing. (Note: This relationship also works in the other direction. The internet provides a platform to companies seeking investors.) The large companies have reached growth capacity, the smart money is looking for better returns, and there are small upstarts lining up to accept that backing. The internet provides the frictionless fluidity to make that happen.

2) From the consumers’ side the internet provides each individual a choice. No longer are consumers forced to consume the me-to, mass marketed products and services that are the by product of the large companies’ cookie cutter (i.e., economies of scale) approach. Also, consumers are no longer at a disadvantage in terms of the availability of information. They know what they want and they know where to get it. Big is out. Small and personal is the new black.

The real question is, will the USA be the next debt ridden, too-big-to-fail dinsaur to fall?

“Put Ad on Web. Count Clicks. Revise.” By Stephanie Cliford (New York Times, Sunday 31 May 2009). Let’s jump right to the AU caveats:

• Yes, this approach is helpful but what the quants and the bean counters are not considering is that the ad with the most clicks does not necessarily make it the most effective. An ad can draw more clicks but ultimately lead to less satisfied guests. In other words, it totally discounts The Guest Experience and simplifies that relationship into one that based on the perspective of the companyand a single click and not the guest and their value over the long run. As we all agree by now, that’s a no-no.
• Yes, if you’re a “little guy / gal” it’s smart to watch the big dogs and see how they’re running. However, in many cases resources might be better spend getting the house in order first. In other words, take a hard objective look at the design of your site (or better yet engage someone else to do so); strongly consider what the UX (i.e., user experience) is like and how that will lead guests to draw conclusions about your brand; also check the responsiveness and thoroughness of your guests services. Unfortunately, one of the current trends is “I just need SEO…” Well, you can SEO/SEM – yes, we just made it a verb – ’til the end of time but you can’t put lipstick on a (less than ideal web site) pig and expect stellar results. In fact,  driving traffic into a sub-par experience can do more harm than good.
• For example, twice in the last two weeks we have used the contact form on the site of the MLS’ Philadelphia Union (www.PhildephiaUnion.com) and have not gotten so much as a auto-reply. It should be noted that this is an expansion team that has yet to play a match. It’s not a good sign when your number one focus is to energize supporters and there’s no response to the Contact Us form.

“Companies Object to Google Policy on Trademarks” By Miguel Helft (New York Times, 15 May 2009) Simply put, all hype and blind envy aside, Google is a publicly traded company and is oblicated to act in the best interest of ther shareholders. If Google can make a profit on a service in spite of a couple random lawsuit then they will continue to do that regardless of how evil it is. Ignore the slogans and the tag lines – once again, actions speak louder than words.

“Social Butterflies Can Raise Money” by Michele Donohue (The NonProfit Times, 1 April 2009).  It’s difficult to go a day without someone asking, “What about Twitter?” or “How can I use Facebook?”. True success stories do seem to be somewhat limited at this point in time. However, all hype aside, when an 800 pound guerrilla – make that two 800 pound guerrillas – walks into your room and beats their chests it’s probably wise  to sit up and listen.

Most Twitter articles tend to focus on how you could / should use Twitter. Yet more often that not the blank stare is followed by, “But what do I have to say that that’s important?” While not mentioned directly, this article highlights another strategy for using this tool… Get others to Twitter about your company, event, etc. to their network. It’s possible you might be asking the wrong question. It’s not a matter of what you have to say, but how can you get others to say (good) things about you. Let them define the what, while you focus on supplying whats to Twitter about. It might not be necessary to build your own network as much as try to capitalize on ones that are already there and are sympathetic to your cause / brand.

While we’re on the subject of non-profits, this issue of NPT also had: “Spending more in a down economy” by Tom Pope, as well as “Destroying The Integrity Of Nonprofits” by Richard A. Viguerie. Unfortunately, Mr. Viguerie’s cutting-against-the-grain insights are not yet available online.

“Curious at Amazon, but Not Idle” by Saul Hansell (New York Times, 27 March 2009). This will get you thinking a little bit. What’s odd is that the article overlooks the real benefit – at least in this case – of Mr Bezos’ curiosity. It puts him closer to his guests, both internal (aka employees) and external (aka customers). Yes, he’s learning but he could just as easily grab a Kindle and read up on cat litter. He is naturally curious because he has vision. Because he is passionate about his company.

In contrast the Detroit car executives don’t even drive their own cars. They’re too disconnected. And the growth of their companies is reflected in their ignorance. Conclusion: Sell the stock of a company next time you read about an executive who doesn’t want to get their hands dirty. Hopefully you won’t be selling you.