Sunday, December 28, 2008

Social networking can quickly spin out of control

Wow, no sooner had I provided a brief shout out to Room 214, and what they're doing in social media, did they step in their own pile in social networking circles.

To quickly summarize what 'appears' to have happened, one of their employees contacted the owner of the Tweeter username @room214 asking if he would be willing to give it to Room 214. The user then forwarded the request to Kevin Rose, founder of Digg, asking for advice or help or something. Kevin then provided that advice via a posting on Seesmic:

That's when it all exploded, with various opinionistas providing their generally-negative two cents on Seesmic, Digg, and other media, calling Room 214 corporate bullies and saying they're surprisingly clumsy, naive, or stupid for mishandling a social networking situation. James Clark, Room 214 founder, has now gone on Digg and his own blog to post apologies and to try to diffuse the situation. All of this appears to have happened overnight from Saturday night to Sunday morning on a quiet, holiday weekend.

I say 'appears' because, like everyone else not directly involved in the situation, I really don't have all the facts. But in the social networking world, it's quite common for that ignorance to be glossed over in the postings of the aforementioned opinionistas because that would tend to discount the validity of their posted rants.

Because I don't know the accurate details, I am not going to comment on what happened, or did not happen, between Room 214 and @room214. But what I find fascinating about the broader situation is the speed and severity of the response, and the implications for Room 214.

Out of the blue, Room 214 now has a multifaceted challenge on their hands. Not only do they have a bit of a corporate image problem in the social networking community, but the situation presents potential implications for their corporate clientele (not to mention the employee-relations issues with the unnamed original protagonist). James Clark has gone a long ways toward addressing the community, but it's the client relations that I find interesting.

I presume that Room 214 offers to help their clients establish and execute social networking strategies, such as establishing Facebook fan groups, MySpace pages, Second Life storefronts, or various other, more intricate campaigns. Their website lists among their current clients the Travel Channel, the Denver Broncos, Alltell Wireless, and Rally Software. A recent press release announced that the Travel Channel just renewed their contract with Room 214 for 2009.

What should Room 214 say to their current clients about this situation? Should they say anything? Should they wait for their clients to stumble across it?

What about prospects that they're trying to sign? Presumably, these prospects will do a minimum amount of due diligence on Room 214 and are probably more likely to stumble across it than even their current clients are.

Here are my thoughts. I would turn the whole experience into a good, solid case study. James Clark mentioned in all of his postings the need to act humbly and honestly, and a case study is the logical extension of that. Admit that a problem occurred, analyze why it occurred, what was done to resolve it, and how it can be avoided in the future.

The process of creating this case study is valuable for many reasons:
  1. This whole thing occurred for a reason, through some lack of company policy or poor communication of that policy or something. Fundamentally, the cause needs to be addressed.
  2. The process of analyzing root cause of the problem and trying to prevent similar occurrences will be valuable for the Room 214 team, building teamwork and strengthening the firm.
  3. Nothing would be more believable and powerful as a marketing piece for current and future clients than an autobiographical case study that effectively says: "Social networking is a powerful tool that, if not carefully wielded, can cause considerable damage. We know firsthand, and we're better equipped to help our clients because of that firsthand knowledge."
The company has the opportunity to become stronger for having gone through this situation. At some point, their clients or prospects will discover the whole thing. Room 214 doesn't need to proactively tell clients about it, but should at least be prepared with a thoughtful response based on critical self-examination.

Sunday, December 21, 2008

Totally Gross

Totally Gross. That's the name of a fun game that Ryan received for his birthday. It's from University Games, and can be purchased in various places.

The boys and I played it this morning and, for a science game, it's pretty fun. Lots of fun science trivia, like the fact that a tick only eats three times in its lifetime, or that frogs close their eyes to help them push food down when they swallow, and just enough actual gross stuff to keep the boys entertained. Good Big Science Saturday stuff.

Saturday, December 13, 2008

Have I cursed my kids?

Earlier this week, we celebrated my son Ryan's birthday at a local restaurant. Ryan's turning 10, and we had a small gathering of his friends and family members. Of the gifts that he received, probably 2/3 of them were science related, either science kits or science-related games.

Of course, the reason he's receiving all of these science-related gifts is because of me and my whole Big Science Saturday thing. We've been doing BSS for years, though now it's pretty infrequent. But everybody in the family and everyone in the neighborhood knows about BSS, so they assume that the kids love science.

The truth is, they have no more or less interest in science than any other kids. They're just stuck with a dad that thinks that science, or at least the structured problem solving associated with the scientific method, is a pretty important thing.

So, both the boys get a bunch of science-related gifts. They don't seem to mind, though, and it gives us a bunch of new BSS material for the next several weeks.

And I made sure that his mom and I got him something far more frivolous, a pair of Heelys.

Wednesday, December 10, 2008

Marketing is a conversation (2 of 2)

As something of a counterexample, consider Vitesse Semiconductor. I was with Vitesse for a few of their rockiest years, when the company disclosed that they had been backdating employee stock options and had some past financial accounting problems regarding revenue recognition. (I left the company early this year because my job had moved to California, and I didn't want to move or commute.) This led to the company failing to file public financials for a couple of years because they needed to restate so many of their past financial reports. As a result, the company was delisted from NASDAQ and remains on the pink sheets. The former high-flyer of the late 90s, whose stock price exceeded $100, is now trading for less than $1.

Now, many companies got caught up in the options backdating scandal, and for various reasons most of these companies were not hit has hard as Vitesse. But at the end of 2007, I believed that Vitesse had survived the worst of it, that they were close to restarting public financial announcements and, most importantly, they had a strategy for growth and profitability into the future. So at that time, I bought a bunch of shares of the company at $0.84 per share.

The company finally released public financials at the end of September. Those financials showed what I had anticipated, that the company was on the road to recovery. Yet yesterday, the company's stock closed at $0.18. Even if we consider that the broader market is down say 50% in the last couple of months, that might mean the company would otherwise trade at $0.36.

What's happening? More importantly, where's it all going?

That's exactly the problem, there's no real way to know. The company website only has product releases and announcements of upcoming investor presentations, and not very many of either of those. Yet I suspect lots of things are going on within the company that people would like to hear about. Where's the forum for sharing or discussing that information?

Well, there's always the finance discussion boards, like this one on Yahoo Finance. But these finance boards are just full of people shouting epithets at each other, or pumping the stock. That's not what I'm talking about.

I'm not even talking about financial information, necessarily, but product information, technology and market discussions, application stories, or the company's view of the world. What did they learn at their last trade show? What does the company want to be when it grows beyond this current financial mess? That's all opaque to an outsider.

In that thundering silence, the stock continues to plummet.

There are lots of technical tools available, including blogs, forums, or podcasts. Why doesn't CEO Chris Gardner podcast? Or Tony Conoscenti, VP Product Marketing, Martin Nuss, VP Technology and Strategy, or CFO Rich Yonker? A biweekly podcast would be a great way to demonstrate leadership and reengage with customers and investors.

Vitesse used to be a dominant leader in their space and still has some strong capabilities. By improving their external communications, they could begin to reestablish thought leadership.

There are several marketing agencies helping companies like Vitesse to redefine external communications beyond traditional PR or, more broadly, to establish communities. One local one is Room 214, who appear to be doing some pretty cool community things. How do I know? I don't for sure, but that's the feeling I get from their blog.

Because they're communicating ...

Tuesday, December 09, 2008

Marketing is a conversation (1 of 2)

I had lunch with a marketing colleague the other day. He mentioned a saying that he's fond of: "Marketing is a campaign, not an event." I agree with that, and would an another: "Marketing is a conversation, not a proclamation."

In a prior post, I mentioned that "My marketing focus was:
  1. Understand customer needs and define the appropriate product or service to meet those needs
  2. Use the appropriate promotional tools to drive revenue growth for those products and services"
If you consider those two points together, understanding customer needs, then promoting, that's bilateral communication or, in essence, a conversation.

More broadly, there are many situations where companies need to have conversations with their customers and other constituents.

For example, SharedPlan had some pretty strong views regarding the collaborative aspects of project planning and management. To help us voice those views, we started a newsletter, quickly growing the readership to about 20,000. At the same time, we provided users a voice by establishing a forum and by providing a repository where users could share project plans. Again, bilateral communication .. a conversation.

At Albeo, we began a similar process. In the lighting market, LEDs represent a completely new model for lighting (with regard to economics, lifetime, light dispersion, light quality, energy use, size, heat, replaceability, you name it). The differences are so dramatic that we couldn't even begin 'selling' until we provided some fundamental education to our customers to enable them to interpret our selling statements. So we started the Albeo LED Academy, an educational resource to provide those basics. The plan was to develop the Academy into a series of webinars or live events that would then enable us to build a user community. That user community would then serve to give our customers a voice to begin a broader conversation. We had some visionary ideas about where LED lighting could go, but until we could hear the collective voice of our customers, we couldn't validate those ideas.

Both of these companies benefited from conversations with their customers and constituents. In the second post on this topic, I'll provide something of a counterexample, a company that could benefit from conversations, but does not seem to recognize or enable that.

Saturday, December 06, 2008

Robo-calling rich folks with investment advice?

"Hi, I'm Jim Coleman, and my records indicate you're a qualified investor. If you are a qualified investor, please press 1 ..."

That's the robocall I received on a Thursday morning at 8:30 am. I was getting ready to leave for work and I hung up at "press 1." But then, as I frequently do, I starting thinking about the marketing tactics being employed here.

According to this site, qualified investors are "individuals, trust accounts or institutional funds with at least $5 million in assets to invest." Therein lies my whole problem with this campaign.

I thought to myself that if I'm worth $5 million, do you suppose I got where I did by answering unsolicited robocalls for investment advice? Presumably, I'm either knowledgeable enough to invest on my own, or smart enough to have a real adviser, one that I found through referral or some other more reliable means, not via robocall.

Also, why would they call at 8:30 am when the qualified investor has either left for work or about to do so? Do qualified investors not work? Maybe they're targeting super-qualified investors who don't go to work anymore. But then, that takes me back to my first point: super-qualified investors are even less likely to respond to robocalls from Jim.

That's when it dawned on me. By asking if the call recipient is qualified, then maybe they're trying to target non-qualified suckers who want to become qualified.

It's kind of like Club 33. About 10 years ago, my company had one of the few corporate memberships to Club 33 at Disneyland, and I took my family there several times. The entrance to the club was an understated door with a 33 on it on one of the main thoroughfares through the New Orleans section. To get in, you rang the bell and the host would ask you to identify yourself, then buzz you in.

The sight of my family ringing that doorbell, being identified, then buzzed in, captivated all those around us. A glance back as we walked in showed faces with a range of emotions from curiousity to envy. People wanted to be part of the club because it was exclusive. They had no idea what was in there, they just knew that they weren't in there.

Non-qualified investors want to be qualified, even if they don't know what qualified is. So they "press 1." That's the only thing I can conclude about that campaign. Maybe next time, I'll take the time to press 1 to learn more.

Friday, December 05, 2008

HM has died, but he left an amazing legacy

I heard on NPR that HM (Henry Molaison) died recently. I had never heard of HM before this story, so I read the Wikipedia entry. What a truly fascinating and tragic story. (His story was apparently the inspiration for the movie Memento, although I doubt there was any killing involved with Henry.)

I can't get the story out of my head, how he went in for brain surgery at age 27 to correct an epileptic seizure problem, and was so irreparably harmed that he was institutionalized the rest of his life. Yet if you spoke with him, he would seem completely normal. His speech was normal, and he could remember things from before the surgery, but nothing from after. He could learn new motor skills, but not remember how or when he learned them. He couldn't remember what he had for breakfast that day, or what he did yesterday, or anything from after the surgery. The oddities go on and on ...

One of the people featured on the NPR story is writing a book on HM, who contributed an immeasurable amount to our understanding of the brain. It's incredibly sad though, the price that he paid to provide us that understanding.