Sep 27

Why You Should Pay Attention to TechCrunch Disrupt (Even if You Don’t Like TechCrunch)

I’ve been to quite a few cities and discussed their tech communities with them. The one thing that rings true everywhere you go is this: everyone compares themselves to the Valley. It generally comes up in the first 30 minutes or so of every conversation.

In Austin, we are constantly making the case for why people should move here and invest in startups. I’ve talked with software developers here and in San Francisco, and there is one major difference:

Business acumen.

This isn’t the case for every Austin and San Francisco startup or software developer, mind you. I just know a lot of developers who are happy consulting and/or coding away in Austin. They aren’t making fortunes, but they certainly aren’t starving.

When I talk to many developers (not all, of course) from the Valley, they are savvy to the ways of venture capital and angel investing. They know who is who, what to expect, and how to play the game. It could be because it’s just too expensive NOT to know how to play and they have companies like Google to learn from, but it does give them an advantage.

Paying attention to TechCrunch Disrupt (Sept. 27-29) won’t teach you how to create compelling Facebook fan pages, switch to Rails 3 or give you the latest tutorial on HTML5. Here’s what you WILL learn about:

  • How to actually get money for your ideas. Yes, bootstrapping is a noble idea. It’s good to bootstrap…for a period of time. After a while, don’t be surprised when your competition raises a round of funding and then creams you. Or better yet, they just steal your idea pretty much outright. Disrupt will feature both VCs and angel investors and will help you navigate the system.
  • The triumphs and pitfalls of running a company from the founders of companies like LinkedIn and Zynga.
  • What Google is up to these days.
  • What startups are going to get the next wave of hype.
  • What it’s like to be a woman in tech.

Turns out, Michael Arrington respected me for standing up to the nasty commenters on his “Women in Tech” post. He invited me to be on a the Women in Tech panel this Tuesday, which features some interesting women including Leila Chirayath Janah, the founder of an interesting non-profit called Samasource. The panel is being moderated by Sarah Lacy.

So check out TechCrunch Disrupt this week. Software solves problems, and problems exist everywhere. Viable software startups should be everywhere–in the Valley and beyond. I’ll be taking notes and so should you.

Sep 21

It Takes Money to Get Facebook Fans

What?!?! You have to BUY Facebook Fans? That’s preposterous.

No it’s not. Consumers are lazy and often don’t care about you. You give them service, they give you money. The transaction has ended. They are under no obligation to fan you, friend you, or do anything beyond this.

In some way, you will have to spend money to get a huge fan base on Facebook. What am I talking about spending money on here?

starbucks-logo31.) Special promotions or deals. Starbucks offers deals for free or discounted coffee for participating on their fan page. I know that if I fan Starbucks, I will get news on the company, but there is an added benefit which just so happens to bring me back in the store. This is margin taken right off the top of their sales, but it’s a sacrifice they make to get more people in the stores and to continually be the #1 provider of fancy pants coffee.

Red_Bull_logo2.) Content that compels people to view and share. Red Bull has EXTREME content targeted towards their audience. They spent money and hours to find it and make it. News about the company hacky sack competition would not cut it, unless told in a super compelling way (which costs you money, because good story tellers don’t go cheap).

Note: if your business is content, you can suggest people fan you as a means for RSS or connecting with a similar community.

zappos-logo3.) Over the top service. Zappos is known for amazing customer service and over 65,000 people like them on Facebook. Customer service oriented companies often have to make seemingly irrational decisions to make customers happy. They have to have a lot of people manning the phones. They have to offer returns when others won’t. Customer service is not “efficient” in the bean counter sense, but having 65,000 fans on Facebook helps you make up the difference by connecting you with user evangelists who can spread the word.

Many companies promote their fan pages with Facebook ads. That costs money too.

Don’t think Fans are worth it? According to this study on GigaOm, the average Facebook fan is worth $136.38, as fans spend an extra $71.84 more than non-fans, are 28 percent more likely to be repeat customers, and 41 percent more likely to recommend a brand to friends than non-fans.

Aug 31

Who Really Was the Man Behind the Curtain in the Women in Tech Debacle?

Man behind the curtainMichael Arrington can be a harsh person, but he is smart. I wouldn’t say that he and other TechCrunch writers are the nerdiest in the industry, but I’d trust his assessment of whether or not a startup will make money and have a viable future.

Having such brutal honesty offline AND online is hard. People don’t like being told their babies are ugly. They don’t want to hear that their UI sucks, their competitor is leaps ahead of them in advancement, or that there aren’t many compelling software companies founded by women. Michael Arrington has faced criticism from all angles and from every part of the planet, because he and his team happen to run the biggest technology blog the world has ever known. People want power, they believe they deserve power, and telling them they haven’t earned it yet will get some people angry at you.

Shira Ovide singled out the culture of TechCrunch in her Wall Street Journal piece as a factor for why there are so few women leaders in technology. Arrington found this unfair. He, after all, has a female CEO whom he picked himself because of her skills. He would LOVE to see female entrepreneurs in the space and end the sausage fest. So he responded with an invite that TechCrunch is happy to cover software created by women that actually interests people.

I read the piece and thought, “Man, he doesn’t get what it’s like to be a woman out there”. It’s not his fault. He’s a guy, and it’s easy to assume that if YOU are cool with having a female CEO, others would be as open too. I disregarded the post entirely until I noticed commenters saying that women just don’t have the right skills for software. I thought this was a bogus statement, so I commented back. It isn’t nature that ensures there are no women in the tech space. I used to be quite good at math and science. I just gave it up because there are a lot of societal pressures on women and frankly, the sciences are a very lonely place for us and I like having friends.

What ensued honestly freaked me out. People would state their impressive credentials and then would put out some of the most illogical, hateful statements I have ever seen. I continued to comment, trying to keep my cool figuring it would do me no service to be nasty about it. I was continually painted as a whiny, know-it-all manhater, almost always by anonymous or obscured commenters. I was called beyond horrible names. It was bizarre enough to almost be funny. Almost.

Prior to installing Disqus, an innovative commenting system, the men behind the curtain of TechCrunch (in this case Arrington and MG Siegler) would have deleted the nasty comments and then grumbled to themselves that humanity is going to hell in a hand basket. But Disqus is real-time and comments show up literally as fast as people can type them. When a nasty comment would pop up, Arrington or Siegler would attempt to delete it and thirty, often nastier threads would show up after it. As the real-time web becomes more prevalent, it will become easier and easier for online mobs to take these pot shots at people with little fear of repercussion. After all, the moderators can’t control them anymore.

People want power. Nice people want it and mean people want it. Like it or not, TechCrunch has it, so it attracts the good AND the bad element no matter what. That’s just reality. As the web speeds up and becomes more connected, it will be up to US to ensure that this blog and other blogs we read are fair and civil for everyone. It’s up to decent men to tell the sexist ones that their jokes and vitriol are not acceptable. It’s up to women to stand up for each other instead of tearing each other apart, or simply ignoring the the problem. Not just when it is easy to add a +1 to a blog post opposing such buffoonery like my last one, but when someone is getting hounded by trolls for standing up for what is right, when it’s brutally hard. The web, like the real world, can be a cruel place. You can’t expect the man behind the curtain to fix all the nastiness for you. It’s just too hard of a job for one person to handle.

Jul 27

Social Media Strategy–Who’s in Charge?

I spoke with Tom Parish yesterday about social media strategy and large companies. Be authentic. Check. Be transparent. Check. Be…organized?

Wha? The social media strategy guy at the conference didn’t preach that on stage when he was waving his book around.

Tom pointed out that in the 90s, every division of a big company wanted control over their presence on the website. There can be a lot of pride of ownership issues, with each division thinking their message and agenda is the most important. You can’t really blame each division for wanting to use the site to become more effective at their jobs, but giving each division control over the layout, voice and functionality of their website would not make for a very cohesive experience to the customer. It would also make it difficult to decide what sections to prioritize.

Social media right now has a bit of the element of the Wild Wild West. Some people go full throttle in with no strategy and get nothing but fool’s gold. Some companies are too scared to venture in such uncharted territory, refusing to let people actually talk back. What seems very common is that the top often doesn’t know or doesn’t care what the underlings are doing with it until an innocent blogger wanders into hostile territory and gets shot up by some Native Americans who didn’t exactly welcome their preaching the virtues of their company with spam.

Like a website, a social media presence can communicate a lot of things. It can reduce tech support costs (see Deirdre Walsh’s thoughts on connecting the National Instruments users to help each other). It can help you get new recruits from the people who know your products best–the users. It’s not just a leadgen tool. This is why I stress that it is not merely a function of marketing, and if you view it as such, you aren’t wrong–you just aren’t using it to its max potential.

What do you see as the best strategies for keeping a company’s social media presence in check?

Jul 13

REI and the Impact of Company Culture

“Not everything that can be counted counts, and not everything that counts can be counted.”
–Albert Einstein

REI is a cool store. From the moment I walk in, I feel the former athlete in me clamoring that I just don’t get outside enough.

The employees are fit. They all do outdoorsy stuff. From the wood walls to the visually blech-but-oh-so-snuggly NorthFace jacket, REI is all about getting that inner kid in you back outdoors. They have “Family Adventure Programs”. Oh, and you aren’t a customer of REI–you are a member.

I can just see the out-of-touch bean counting accountant going, “Wait, we are paying for our employees to go to the Muir Woods? Jigga wha?”

To the average bean counter, none of these things make sense. It does not make sense for REI to be a co-op instead of a corporation and hire people based on their kayaking skills versus last years’ quota figures. What it does do is promote loyal customers. There is no measurable ROI you get when a loyal customer buys a cool new bike from REI, shows it off to his friends, and then says, “You have to talk to Jorge about your next bike. He is the BEST.” REI’s ridiculously lenient return policy for members is a bean counter’s nightmare but does ensure that customers always start their search for outdoor goods there.

Apparently REI’s model makes sense because they have stores in 28 states and have been in business 72 years. Who knew?

Jul 07

Do You Think the Fast Company “Influence Project” Actually Influenced Anything?

Technology is cool. I love seeing marketing campaigns like Fast Company’s “Influence Project” use it creatively. What I don’t like seeing is a campaign that takes a cool idea and misses the mark in terms of understanding the fundamentals of human motivation and drive. I do not agree with Rohit Bhargava’s assessment that this is a “brilliantly conceived marketing campaign”.

Essentially, you get a link and the more times people click on the link, the bigger your photo shows up in their influence graph. Now, the graph looks pretty cool, but let’s break down this concept for the end user (the clicker):

1.) I click link.
2.) I make your picture bigger for other Fast Company readers to see.

6a00d8341c4f1253ef0133f21f3af7970b-800wi

As someone who loves using technology to make marketing campaigns more interesting, I am not quite sure what the end goal is here. Do people really think true influencers will actually value having their photo show up bigger on Fast Company? Is the Dalai Lama keen on showing you that he has more clout than you? Can you see Alan Greenspan hovering over his computer, furiously spreading his link around to ensure that Bill Clinton does not beat him on the influence graph?

Influence is something we earn by gaining expertise and by executing on it. It’s also something we can waste if we get too carried away in our own egos. I don’t question that influential people could certainly “win” this contest, I am just not quite sure they would actually care to. It is self-promotion for self-promotion’s sake and reminds me of those weird programs where at-risk kids go door to door and practice their speaking skills for money. Couldn’t they just spend that time selling something? Raising money for charity? Anything?

So I have to agree with Amber Naslund’s assessment. The graph is a cool idea, but I wish Fast Company appealed to my desire to be helpful rather than my desire to be known.

*pic from http://www.rohitbhargava.com

Jun 27

Why Do Corporations Struggle with Social Media?

I see a lot of larger companies who don’t seem to get how social media makes things cheaper and well, just better. It’s a direct communication tool, like a cell phone. Big companies seem to just snuggle with Web 2.0 rockstars and then call it a day. That’s lame. That doesn’t make me want to throw you my money. I just want to know that you aren’t going to hose me or my friends and then we are cool.

Here are some tips for large companies on how they can cut costs, improve their products, and well, make the world a better place by using social media:

1.) It sounds harsh, but evolve or die.
Look folks, I’m not making this stuff up. Social media and in particular Facebook is a global revolution. Imagine a country that grows to 400 million people in six years. That’s Facebook. Twitter was founded in 2006, and studies show that 37 percent of journalists already use it. 59 percent of them already blog.

Yes, it sprung up on you, but that doesn’t mean you can’t take it seriously. If 37 percent of journalists are on Twitter, how easy is it for pissed off customers to hit them up with a juicy story about your company?

What am I saying here? It means 1.) Your communications people need to do their homework, 2.) Your senior leadership needs to do their homework, and 3.) You need to come up with a plan and a budget, and you need to revisit them frequently. Don’t just ignore it because the word “Twitter” sounds kind of dirty.

2.) Social media is not a marketing tool. It can be used by your entire company.
Social media tools like Twitter are merely communication tools. When I advise people about them, I use a term from the movie “The Matrix”:
There is no spoon.

This means you can use Vimeo not just to spam people with ads, but to instruct them how to use your product. You can use Twitter to follow potential business development opportunities or get feedback for your product teams. There really is no rigid “use” for social media. If you give it to the marketing team, you are essentially telling the world, “The only way we would like to communicate with you is to sell you something”. I suppose that’s within a company’s right, but there are many more useful ways to use social media to cut costs and make things happen in a short period of time.

3.) You are playing with fire when you outsource it to someone else.
Your customers are going to ask you all sorts of things.
Can I get a job at your company?
Fix this issue or I’m calling my lawyer.
Why hasn’t this tech support rep answered my email?

Can you really trust some 24-year-old at a marketing agency will get a tweet from a journalist or a very angry customer and is going to represent your company in a way that doesn’t get you in trouble with the SEC or the press? I don’t really understand this model of using social media. I’ve tried it and it doesn’t work. Agencies can create good marketing campaigns using social media and can provide guidance for sure (see this and this), but they shouldn’t really represent your company’s presence online.

Again, trusting it just to the marketers means you are missing other opportunities to save money, like using these tools for tech support or product development.

4.) You let the lawyers take control even though they think “blog” is a drink you have on Christmas.
People seem to think lawyers know everything about the law. Here’s a secret: THEY DON’T. The law is very expansive and constantly changes. No lawyer knows everything about it and if they do, they are just big lying liars.

Lawyers should not be able to set policies on tweeting and blogging if they don’t have any familiarity with the mediums and in particular, the concept of Creative Commons. It just makes employees nervous and distrustful and then they do their own thing on the side anyway. Just like senior leadership should do due diligence to learn about social media, so should the legal department.

5.) People aren’t convenient numbers. They are people. Now they can form a “corporation” of their own, for you or against you.
This is perhaps the point where big companies struggle the most. You’ve got the bean counters who expect certain amounts of leads, profits, etc, whatever. They are used to a Cold War game, where you just outgun your opponent with huge shock and awe figures.

The game has changed. This is not a trend. This isn’t a fad. That game is gone and lost forever.

What the Cold War mentality isn’t considering in a new media world is that these numbers can all ban together and decide you rock. They can ban together and decide you suck. They now have easy access to each other. You can’t just hose a bunch of people and think they don’t know any better. It’s not the way it used to be. They are all talking about your company and comparing notes.

In a new media world, you just have to be honest and reduce your risk for IEDs, snipers, and the like. You have to win the hearts and minds of people and then ask them to spread the word.

It’s not that corporations can’t be agile enough–it’s that often the people in charge simply don’t get it. They didn’t get where they are at using it so there is no use dropping what works for some “fad”. A little research and a holistic strategy about social media could mean wonders for them. I don’t how you can look at social media tools and figure that consumers will ever stop using them to reach out to each other. They just help people make informed decisions.

Frustrated because your company fits this bill? Leave a comment for how big companies can improve what they are doing. You can use a fake name like Awesome McAwesomePants or something outrageously cool like that so as to not incriminate yourself.

Jun 24

When Closing More Leads Can Actually Hurt You More

Marketing. It’s often considered a spin doctor-ish, slimy profession intended to deceive people into buying something they don’t need.

Marketing as it should be done is actually a very noble profession that can improve people’s lives. However, not only is pursuing “anyone and everyone” at the expense of their happiness unethical, it is stupid and costly to your business.

Bazaarvoice is a company that allows companies to increase and measure reviews about their products. Here are some stats they’ve gathered about word-of-mouth:

*The average consumer mentions specific brands over 90 times per week in conversations with friends, family, and co-workers. (Keller Fay, WOMMA, 2010)
*90% of consumers online trust recommendations from people they know; 70% trust opinions of unknown users. (Econsultancy, July 2009)
*Users put great trust in their social networks. One-half of Beresford respondents said they considered information shared on their networks when making a decision—and the proportion was higher among users ages 18 to 24, at 65%. (eMarketer, October 2009)
*Consumers trust friends above experts when it comes to product recommendations (65% trust friends, 27% trust experts, 8% trust celebrities). (Yankelovich)

Why are these statistics relevant? These along with reputable game theory studies show that people trust other people they know more than they’ll trust you. If you are doing the slimeball marketing tactic by focusing on sheer numbers and quotas, you aren’t focused on who is actually buying your product and if these people would actually enjoy using it.

LET’S DO THE MATH:

Let’s say that your manager wants you to meet a quota, and so you sell 10,000 widgets like you were asked. Because widgets are rather obscure, you sort of fudged the benefits of the product and now only 25 percent of the people who use them are happy with the product. That’s 7500 people who now hate your widget and probably you for selling it to them. According to a study cited by the social network DoctorBase, if these are social media users, a negative review from them will reach 130 people. That’s:

7500
* 130
975,000 people who now think you deceived them

Now let’s say you do this more responsibly. You ignore your manager’s quota and you say, “I won’t get 10,000 sold now, but I will have 3000 sold in six months, and 75,000 sold in a year, and I will do it in a way where we can spend much less in marketing and much more improving our product for the future”. How do you do this?

1.) Understand what your widget is, how customers use it, and how it compares to other products like it in the industry.
2.) Instead of figuring out how you can preach your product far and wide to everyone, figure out how you can get it to 3000 who would be insanely happy with it. This is a lot easier to achieve than finding 10,000 happy customers but requires a bit more homework.
3.) Make those 3000 people insanely happy with your widget. This may or may not cost money in product development, but that’s often what it takes to make people insanely happy.

Let’s be very conservative here. If you make people insanely happy with your product, asking them to tell their friends about you is actually quite easy. They feel like they are doing their friends a favor. So let’s say those 3000 people only reach out to an average of 25 people and convince them that your widget will totally change their lives.

3000
* 25
75,000 people bought your widget and love it.

That’s 7.5 times what your General Manager asked you to sell.

By marketing to those 10,000 instead, you now have to do damage control for your brand’s reputation. You have to spend more money sustaining growth because people aren’t talking about how awesome you are. You have to spend money on customer acquisition and retention. That means less money for product development. This hardly seems sustainable.

By being a marketing sniper versus a cannon, you can trust your community of users to do the marketing for you. Plus you can sleep at night, which is always a plus. ;)

Feb 11

Gain Loyalty by Protecting Your Network

It’s nice to have a lot of contacts. I like the idea of knowing a go-to person for just about everything and that the fact that we know each other makes us more accountable to each other.

There is something you notice when you start meeting a lot of people indiscriminately though. You open yourself up to what I call “toxic networks”. These are people who always manage to ask you or your network for favors but offer none in return. Or my favorite technique–they’ll give you a favor even though you didn’t ask for one and then expect that they can ask you for whatever they want. It’s like they are some sort of New York City window washer at a street light.

I don’t think people intend to impose. They often do not see that when they ask you for something that is easy for you but hard for them, they could be one of 50 people doing just that at that very moment. It’s not cool that it pans out this way but that’s just life.

So how do you protect against this?

1.) Don’t “network” for volume–network for quality. Having one good designer in your network is worth more than eight mediocre ones.
2.) Slow and steady wins the race. Network through existing networks you trust. Good people tend to attract good people.
3.) “Big” doesn’t mean quality. Some successful people I know also seem to ask for the most and give the least. It’s irritating but the way of the world sometimes.
4.) Don’t be afraid to cut someone off. The time you spend with people who drag you down could be spent with people who are actually quality.
5.) Don’t think of what a person means to you. Think of what that person means to your network. If you are ashamed to introduce someone to others, they are not worth your time.
6.) If you initiate a favor with someone, don’t be that window washer expecting a favor in return. Help people because you want to support something good. Then it’s easy to feel positive about life.

Introducing two people into what is a mutually beneficial relationship is a very satisfying feat. Introducing a good person to what I would call a succubus is not. I’ve done a bit of both in my time. Keep good company, play smart instead of fast, and you won’t have anything to worry about.

Jan 24

Why I Never Want to Buy a Non-Hybrid Car Again

I recently got a great deal on Toyota Prius from Motorphilia. I have never been so pleased purchasing a car. Not even when I bought a BMW 328 brand new.

Why do I love my car?
1.) I like the fact that my car contributes significantly less CO2 in the air than my other car did. Why? Because I as well as other people I like breathe air, and I’d just assume keep it clean.
2.) I am saddened by the political landscape in the Middle East and other regions dominated by oil. Oil is a capital-rich, labor poor industry, which often presents a ripe breeding ground for corruption. By driving a car that gets 45 miles to the gallon average, I am helping reduce the demand for oil. America should be free of this addiction once and for all.
3.) It’s very cheap to fill up. $20 can fill the tank.
4.) It drives well and has a very nice fit and finish.

Toyota puts a meter on the dash that shows how many miles you are getting per gallon. It feels like a video game when you try to reduce it, and I like the notion that they reward drivers for responsible behavior.

Joshua Baer claims he’ll never drive another gas powered vehicle again. I don’t blame him one bit. Once you realize how enjoyable it is to drive a battery powered car, you’ll wonder why more vehicles don’t use one.

Anyway, not trying to be a smug hippie here. I just really dig my new (to me) car.