Category Archives: The Internet

United Airlines: Broken Guitar Triggers Stock Rally

A few days ago some of the bright lights in the social media domain were all lathered up about a group of academics who were able to ‘prove’ that Twitter ‘predicted the outcome of stock market’. As it turns out, it was a worthy attempt by some academics who looked at historical data and found a parallel relationship between public sentiment and stock market movement (go to the link here). They were the first to admit that they did not find any causality between Twitter and movement in the stock market. The paper was unpublished and had not been through an academic peer review. Nary a peep from those same lathered up socialmedialists since (I think they might have been avatars anyway, not real people).

This got me thinking about the United Airlines incident whereby some poor unfortunate troubadour had his guitar allegedly mishandled and damaged by United Airlines. He was so incensed that he wrote a song about the incident and posted it on YouTube. The digerati swooned as it was ideal fodder for these Internet imperialists to take down yet another brand. So United was vilified as have many airlines since the rise of social media platforms. As they are fond of saying, Mr./Mrs. CMO – you no longer control the brand.

Well, here we are a year since the United Broke My Guitar incident. It’s earnings week in the US airline industry. So far, AMR, Southwest and Delta have fared quite well and most airlines are expected to post strong Q3 results.

Which brings me back to United Airlines. Since July 2009, United stock has been steadily on the rise. In fact, it would appear that the rally coincided almost to the day of the Broken Guitar incident and the stock has risen 10-fold since. Maybe there really is something to this social media analysis stuff.

Broken Guitar Triggers Rally

 

– Ted Morris, 4ScreensMedia.

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Commentary: Media Companies Need To Become Marketing Companies

The following is an excerpt from an online post authored by Andrew Heyward and Jeffrey F. Rayport in a recent edition of Harvard Business Review:     

                                                                                                                                                                         These consumers, people we like to call “Customers 3.0,” live in a blur of mash-ups, blogs, RSS feeds, links, text messages, tweets, and “life-casting” on social networks like Facebook and MySpace. For Customers 3.0, the very idea of content includes everything, embracing all media formats as well as advertising. And they collect, collate, and customize such content according to their individual tastes in personalized online environments (like MySpace or Facebook “pages”). This is what we call “user-generated context.”        

In this environment, it’s increasingly difficult for either publishers OR advertisers to stand out. The long-standing value proposition of publishers to brands – we create compelling content that attracts a desirable audience and then sell you the privilege of placing your commercial messages adjacent to it – is becoming a tougher sell.         

That’s because marketers don’t get much value out of seeing their messages appear in anodyne ad units (like banners ads). They need rich integration of their brands with content users are seeking or creating on their own. That leaves publishers in a sticky position: either they stand by and watch marketers build compelling online experiences without them, or they put their editorial and creative capabilities to use to help their clients – the big brands – cut through the clutter.         

In our practice, we like to say that “every company is a media company.” Increasingly, every media company must also become a marketing company. For online publishers, the challenge is to achieve that goal without damaging the very reputation for credibility and integrity on which their market positions rest. If online publishers can’t manage that balancing act before it’s too late, they’ll have more than mud on their faces.          

Here is my take:  As brands/national advertisers transform in part, to media, publishers have an opportunity to seek new partnerships by redefining their roles. For one, extending the value proposition means that publishers can be purveyors of a paid subscription base that is made available to brands as participants in making the message. Media and message become united. Message and media finally merge in a way that makes business and cultural sense.    

What this may mean, by necessity, is the redefinition of how the paid print advertising model is architected as ‘earned media’ become currency. This is not to advocate a ‘freemium model’ – after all, you still only get what you pay for – rather a model that attributes a business value to user-generated content reflecting the effort and subsequent return of the medium.     

Those that see the opportunity will find the right tools for the job. New cloud applications are about to come out of the gate in such as way that makes the cost of entry low and the opens the door to test this new media paradigm.      

– Ted Morris, 4ScreensMedia      

Management by Algorithm

In a recent post by Brian Solis “Influencing the Influencer” I was struck by the image showing a definition of leadership. Solis goes on to suggest how important people are in the marketing mix. Rightly so, he sets the context as the ‘attention economy’ as many who participate in social networks have an insatiable appetite for attention, notably those who see themselves as “authorities and tastemakers” or at that exalted level of self-actualisation, brands. Apparently, these are the folks that brands must recruit across the social media galaxy in order to truly lead, then connect with the broader audience – the ‘everyman’, in a most sincere and meaningful way.

So, like the days of television rabbit ears, brands need a shill: “A person who publicizes or praises something or someone for reasons of self-interest, personal profit, or friendship or loyalty.” (via Dictionary.com)

This is the oldest game in the advertising playbook.  The difference is of course, that the brand is supposed to recruit people who come from a superior gene pool, that of the online reviewer or opinion leader. It’s real time, it’s from the heart and… it’s transparent. To reinforce this approach, a number of SaaS applications are mentioned such as Klout and PeerIndex that use ‘human’ algorithms to calculate one’s social currency (capital?). It’s so valuable, anyone can calculate their influence scores for free.

Has it occured to those who advocate this kind of approach to identifying influencers that some consumers have no interest is what others think? Rather, consumers prefer to try things themselves. In otherwords, they prefer to take the lead, thank you very much.

For marketing managers, understanding customer preferences and value drivers, is really the first place to start. Management by algorithms alone is a very dangerous thing to do as it places limits on the ability to learn, develop insight and understand consumer behaviour in context.

As in using spell check, your facility with language doesn’t improve over time.

– Ted Morris, 4ScreensMedia

The Social Maze

Where are all my customers?

 The funny thing about all the endless advocacy of social media is that nothing has really changed in the business of matching consumers with brands. Oh sure, now that consumers ‘control the brand’, companies are at the mercy of infantile twittering tantrums such  as when consumers don’t get their way (especially on an airline) hoping to unleash a social firestorm primarily with the hope of getting noticed for a nanosecond or two. (The same folks likely get back on the same airline, content to collect their frequent flyer points.) 

One would think, with all those folks splaying their private lives out in public via the likes of YouTube, Facebook, Twitter, Flickr and Foursquare – lest we forget this thing called a phonebook or the science of geodemographics and credit card purchase data – that people would be easy to find. In fact, with all of the yottabytes of data out there about consumers, it should, in the year 2010, be a matter of running an algorithm or two to find customers, understand preferences and match any product or offer with any consumer 24/7 in any country with high Internet penetration.  It would be the end to the need to advertise using traditional channels.

Funny indeed. The search and storage/processing technology required to make the social web possible has, as the main output, data. Whether you call it media or content it’s still really just more data taking up space on some distant server farm deep in the Mariana Trench. As such, are we all the wiser? Not really. With free cloud apps having a shelf life not much longer that the vegetables in your local supermarket, many are wary of the risks of implementing something that will be obsolete by the time it gets traction in the marketplace. With the yet to be proven value of social media monitoring and analytics, it’s not as if the world has abandoned representative random sampling or in-market product trials.  

Do companies really have the strategies, skill sets or business processes to effectively leverage the social web? With only $2 billion slated for social media spending in the USA this year, I doubt it. Yet, evangelists are forever hopeful, as that is their stock in trade. Like Charles Revson, founder of Revlon once said, “In the factory we make cosmetics; in the store we sell hope.”  

On the other hand, Charles Revson didn’t have social networks at his disposal but his customers had no trouble finding the Revlon counter.  

– Ted Morris, 4ScreensMedia

Marketing Technology: Mobile People & Portable Brands

The idea of mobile communications is not something new, it’s just that things have progressed immensely since the days prior to the Internet and PDA devices.

What lies ahead is a huge opportunity for brands to get closer to their customers daily lives by  becoming integral to their cutomers’ processes. For me, the idea orignated when I was at IBM where self-serve technologies, such as the ATM and airline check-in kiosk were beginning to take hold. One of my colleagues quipped “Yes, it’s really about the customer saying to the brand ‘come into my process’ but I will remain in control of the transaction”.

This was compelling as it freed the customer not only from delays (lineups at the airport) but it suggested that the customer could transact when and where they pleased – on their own terms.

With mobile devices – PDA’s if you will, customer (and brands) can enjoy more freedom than ever before. No longer encumbered by a fixed location to transact, bank customers can now do their banking from wherever and whenever they choose. The same goes for those who travel by air, say, using Air Canada or Virgin Airways.

Mobile applications can and are being developed for many brand categories. Pharmaceutical apps can help patients with prescription continuance and information on disease states; automotive dealerships send service alerts so that maintenance schedules are adhered to; transit systems can notify passengers when the next bus is about to arrive at a stop.

At the end of the day, its about people who are mobile, devices that enable ‘anywhere computing’ and brands that are portable – the ultimate engagement & collaboration.

– Ted Morris, 4ScreensCRM

Data: The New Capital of the Digital Age

Data: The New Green

The Economist recently ran a special report on managing information that prompted some thinking. First, some big numbers from the report: Wal-Mart handles over 1 million sales transactions per hour. Facebook houses some 40 billion photos (after only 4 years of operation). Cisco estimates that Internet traffic will reach 667 exabytes by 2013.

 With some 60 million people on Twitter, according to comScore data (November 2009), there are roughly 10 million tweets a day. This doesn’t account for the content – characters, photos, articles and video content. I also found that YouTube has generated more video content than all of the television networks combined have ever generated. The current upload rate is equivalent to about 100,000 Hollywood movies being made on a monthly basis. Finally, almost 100 trillion e-mails were sent in 2009.  

Bringing this a bit closer to home, consider the number of daily transactions that take place for banking, air travel, credit card processing, phone calls and e-commerce. You end up with some very large numbers indeed. This data also says a lot about how we behave. Most intriguing perhaps is what it can tell us, through the use of complex algorithms, how we might behave at some future point in time – and where new business opportunity may dwell.  

This growth in the information industry is not reflective of recessionary times. It points to a shift in investment, new business models, the laying of new infrastructure (servers, storage, cloud computing, software) and global workforce expansion in business information. It’s also transformational as the CIO’s role is increasingly one of contributing directly to business growth in contrast to the dogmatic notion of keeping the lights on in the boiler rooms of Enterprise Resource Planning and Supply Chain Management.  

It’s the effect of the peta, exa and yottabyte world that is most intriguing. Conventional ways to sense and understand consumer behaviour  will be challenged by the new wave of business analytics. Marketing research is but one example. If predictive analytics can do a better job of identifying which category of SKU’s is trending upward or which meal combo is gaining favour, what will marketing research be used for? Data analytics can also be used to generate new ideas for services, products and as importantly, help companies shed under-performing assets and balance inventories. By implication, there is a clear line of sight to the financial payback as firms like Amazon and Marriott have learned.  

This point from the Economist is worth noting:  

“…all these data are turning the social sciences upside down, he [Sinan Aral, NYU] explains. Researchers are now able to understand human behaviour at the population level rather than the individual level.”  

It’s no wonder Big Tech (IBM, Microsoft, Oracle, SAP etc.) is loading up on search, storage and processing capability. In exchange they will reap new profits from the digital age, largely unnoticed from behind the curtain of social networks and online store fronts.   

– Ted Morris, 4ScreensCRM  

Meet @Spam – Social Media Persona

This is @spam. Lots of followers, a ‘personal branding’ advocate and someone who is famous, at least, by some measure. You know, the type that likes to dispense advice, get your attention and loves to tell you about themselves in the most menial of ways.

Unlike the commercial “When E.F. Hutton speaks, people listen”…this is where is all ends, perhaps.

@spam. All about the ‘me’ in social media.

– Ted Morris, 4ScreensCRM