Modern Marketing - Blog by Collaborate PR & Marketing

Spectrum Free TV

I met Miles 'LG15' Beckett last summer to chat over the launch of Kate Modern in the UK.  Gazillions of page views, millions of users and many rave reviews later, Beckett is seen as one of the pioneers in the morphing world of TV.  The LG15 team is now a company called EQAL which has just signed a deal with CBS to build on their vision of community-driven drama.  In the announcement, I was struck by the simplicity of Beckett's vision about what he does: “It’s incredibly exciting how you can take existing TV, make it interactive and create communities around it.”  Makes it sound easy doesn't he?  In my chat last year I was struck that, while it involved huge amounts of work by a group of very clever people, the plans for KateModern weren't complicated.  A couple of backers, some young actors, the starting point for a script, a flat in Whitechapel and some handheld cameras.  Oh, and a deal with Bebo on the back of the LG15 story.  But the really big thing, the broadcasting or spectrum to share stories with the world - that was a given.  It's a kind of if we've got it, we can share it mentality which is hard wired into the brains of webizens and everyone under the age of about 25.  Clay Shirky illustrates the point when he says that the hardest time he has with his students is explaining that (only) ten years ago, you couldn't instantly share your ideas with the world.  This is one of those far-reaching changes that can be difficult for people still stuck in a world of spectrum scarcity to fully understand.  Just compare the ease of Beckett's vision for a brave new world of TV with those of his now boss, CBS Interactive president, Quincy Smith said: “These guys have cracked the code.”  There's no doubt that Beckett and his crew are super-smart and have learnt a lot about the world of community-driven story telling, but I didn't get the impression that they think of themselves as code crackers.  They are just playing with the new toys available to us all.  And having fun along the way.

Passport Control

Data Portability is the type of phrase that only the tech-heads of Silicon Valley get excited about.  In English, it simply means the ability to carry your personal data from place to place on the web, rather than creating similar profiles with many different organisations, websites and social networks.  Today's system is like having different passports for each country of the world that you visit.  Data Portability is the vision that wherever you go online, a single passport is enough to get you through customs and a room for the night.  Simple, right?  Yes, but like everything else happening on the modern web there is a gigantic power struggle going on beneath the surface.  To date, the approach of the mega social networks has been to try and keep users within their walls.  The main tactic they rely on for this is inertia.  Just like a bank, once you have spent so much time and effort finding a lender who does the basics, built a record with them, and designed your life around their products, it becomes a wrench to move elsewhere.  For social networks this inertia is largely driven by the power of the network effect.  And, to date, this dynamic has been enough to sort the men from the boys, leaving just a few social network operators standing including Facebook, Google, Yahoo, Microsoft and MySpace. However, all of the big players are aware of the scenario where inertia is not enough to keep their customers in place.  If your friends suddenly start deserting a social network for the next big thing, you may well throw inertia to the wind and join them.  It's the equivalent of a run on a bank.  So rather than just be the fashionable country that people may eventually tire of, the next fight is to decide who gets to issue the passports.  Last week, three social nets made announcements designed to give them passport control.  The initiatives were MySpace MySpace Data Availability, Facebook Connect and Google's Friend Connect.  All have different takes on the same issue.  (Notably, Google are trying to build around you, while the others want you to build around them).  But regardless of strategies, it's still a fight to become the official identity-manger of the web.  And it's that identity brokerage role that is the big prize for social networks, especially as they are still trying to find viable financial models.  Will it work?  Who knows.  Microsoft tried their own passport service a while back and it hasn't really taken off.  And many other such systems have been the victims of over-complexity, aka death-by-a-million-features. But the promise of being the guys who issue the online passports is too tempting.  Expect to hear a lot more about Data Portability.

By The People, For The People

Thanks to Anon for this insightful comment, left on the post below, about the morphing world of users and audience: "The metaphor I keep coming back to on this is Folk Music.  If you look at an open mic session, the "audience" turns up and sometimes, some people join in. People start by foot tapping, after a few ales they might pick up the courage to play an instrument, sing along at a table or even grab the mic. The boundary between audience and artist is practically non-existent. They are also playing, improvising and "remixing" copyright free music. Most importantly, you don't have to do anything, just by being there you feel as if you are participating. Internet participation and the movement from audience to user is creating a new "folk" or "people's" culture."

Is Your Audience A Bunch Of Users?

Last year, I was told by a grand fromage at Microsoft that an important part of the company's shift from software to media was changing its view of customers - from many users to a single audience.  Historically, MS has sold software to individuals who use it for their own disparate needs.  However, now the web has joined all these people together they can be seen as one big group.  And when you put it like that, advertisers are interested and branding bucks follow.  What struck me at the time was that while MS was moving from users to audience, Big Media was going in the opposite direction.  Murdoch & Co are trying to coax their audiences into a more active relationship by giving them tools to voice their views.  To become users of media in fact.  So what's going on?  Are we an audience?  Or is everyone a user now?  Of course, the truth is somewhere in between and everyone needs to find their own place along the spectrum.  For instance, it's perfectly possible to have an audience and users at the same time.  There will be occasions where your ability to serve users will create an audience that in turn pays the bills.  For instance, you can launch a few free web tools, wait for the network effect to kick in, crank-up the ad server and hoover up those AdWord dollars.  The Big Daddy of this model is Search but Mail is in there too.  But even here, some hard lessons are being learnt.  For instance, if you launch tools where everybody is a user, such as social networking, it's difficult to move along to the audience end of the spectrum where the ad revenues live.  (Unless you can persuade someone else to pay up front for the inventory).  In fact, the audience-user debate is a bit like the open-closed discussion.  If you go too open it can be bad, and if you go too closed it can be bad.  But if you are prepared to just keep on trying different recipes, you might hit the sweetspot.  For example, if you create tools which let users find their own audience, you can kick back and let the Ooomph Factor build you a super-community that drives operations elsewhere.  So, in reality, the audience isn't only users, and the users aren't an audience.  They're all people.  Which is where it gets complicated.

Google's TV Strategy Goes Live

The statement, "Television is a great way to reach new customers who might not be familiar with your product or service," is about as bland as it gets - but not when it's coming from Google.  The company has launched its TV media planning and buying service on the Dish network in the US which has 14m subscribers.  A quick peek at the demo shows that its effectively just an extension of AdWords and it must have media execs everywhere choking on their flat whites.  And no doubt there will be a few cappuccino-spillages when their creative brethren check out the the Ad Creation Marketplace, "where you can connect with industry professionals who provide script writing, editing, production, and voice-over talent at an affordable package cost".  In reality, however, this isn't a system that's MegaCorps are going to start using anytime soon.  It's focused on The Long Tail and the viewers aren't there in the required numbers.  But that's the thing about market disruptors.  They always start at that part of the market which appears to be worthless - and then grow creating Innovation Dilemmas for the big boys serving their high-value customers.  But the really interesting (although not surprising) part is that Google are promoting the fact that TV ads drive a lot of search queries.  In effect, Google are taking their mega-cash engine platform and protecting it by entering related industries.  Or in other words using their search 'standard' to 'embrace' new areas of media.  Remind you of anyone?

Community Pays

Sam Lawrence has a great piece about the supersonic Nike+ community, including an interview with Nike-dude Roberto Tagliabue.  Community is often seen as a sort of love-in with no commercial value.  But here's Nike's experience: "As of February, 2008, Nike+ members have run over 50,000,000 miles, logged over 14,000,000 runs and issued over 450,000 challenges. We created the world’s largest running club at nikeplus.com. 40% of community members who didn’t own Nike+ ended up buying. That is pretty tangible."

Don't They Have Jobs?

This is a question I get asked a lot by people who are trying to understand where people find the time to participate online.  My normal answer is that they do less of other stuff - including TV.  But now I've got a much better answer thanks to Clay Shirky including this gem: "If you take Wikipedia as a kind of unit, all of Wikipedia, the whole project--every page, every edit, every talk page, every line of code, in every language that Wikipedia exists in--that represents something like the cumulation of 100 million hours of human thought.  I worked this out with Martin Wattenberg at IBM; it's a back-of-the-envelope calculation, but it's the right order of magnitude, about 100 million hours of thought.  And television watching?  Two hundred billion hours, in the U.S. alone, every year. Put another way, now that we have a unit, that's 2,000 Wikipedia projects a year spent watching television.  Or put still another way, in the U.S., we spend 100 million hours every weekend, just watching the ads. This is a pretty big surplus. People asking, "Where do they find the time?" when they're looking at things like Wikipedia don't understand how tiny that entire project is, as a carve-out of this asset that's finally being dragged into what Tim calls an architecture of participation."

[Joe at MediaBistro has summarised this perfectly - "A wikipedia a weekend spent watching ads."  Brilliant!]

Why Supply Chains Need P2P Plumbing

Supply chain management is not a term to get the blood rushing but it is a vital corporate function that describes taking raw materials from the field to the shelf.  I spent a few years at a large consultancy and saw first hand quite how complex the planning of such supply chains can become.  Armies of smart consultants would spend months mapping out the passage of exotic supplies through global megacorps, before turning the whole process into bits and bytes.  To date, supply chains have been just like company plumbing.  When blockages appeared they were quickly flushed out to keep the pipes to retailers and customers flowing freely.  However, these days, there are some new pipes that are changing the nature of markets - and supply chains.  They are the P2P pipes that customers have set up themselves. And these P2P and networked media environments have created blockages that can't just be flushed out with a corporate enema.  Think of the effect that Shawn Fanning's Napster had on the music industry.  By linking together all the customers in the market he stuck a spanner in the companies' supply chains and they've never recovered.  But all he did was recognise that the marketplace was demanding something different and used the tools at hand to meet it.  What if the music industry had extended their supply chains to include some of these new P2P pipes?  By focusing on rebuilding the marketplace, rather than protecting their industry, they could have trousered the revenues that their customers wanted to give them - rather than suing them for the ones that they didn't.  Instead they despatched a million writs, let Apple hijack the entire marketplace and joined the DRM-free party when it was too late and their reputations were dirt.  But that's all hindsight right?  Well yes, but it's also a warning for companies who still that think their supply chains stop at the corporate walls.  Compare the experience of the music labels to Lego who have extended their own supply chains into the 'grey' market where their customers are busy innovating - and plumbed them right back into the business. The company's vision in this area has transformed its fortunes.  So where do you start?  The first step is to understand which P2P pipes are relevant - and remember they may 'just' be small discussions about problems or innovations.  There are many ways to do this.  Dell's IdeaStorm and MyStarBucksIdea should help both companies stay on top of any new plumbing appearing beyond their firewalls and allow them to act.  Alternatively, you can ignore the whole thing and hope that the next Shawn Fanning isn't doing some P2P plumbing on your supply chains as we speak.

Data Is Behaviour

Marketeers are data hounds and view the world through a kaleidoscope of TGIs, JICREGs, TVRs, GRPs, PIs and other splendid analytical goodness.  However, although very smart and helpful, these systems are still approximations (aka guess-timates) of what might be happening in a complex world.  Now, as people increasingly lead their lives online, we have information about what is actually happening in a complex world.  So, for example, instead of mocking-up profiles of typical customers to help guide strategy - we can let the data describe the reality.  And we can see how that reality changes.  All of which, on the face of it, sounds like a good thing.  However, in fact, the move from reference to reality is tricky.  For starters, there's A LOT of this reality stuff and it's VERY messy.  But as with all technology, that bit will eventually be solved by some smart folk, a few machines and a bit of Gordon Moore's magic.  No, the tricky part is moving away from the reassuring, grand planning environment into one where you know who the customer is - because you can smell him.  It's The Cathedral And The Bazaar all over.  In the networked world data isn't an extrapolation or a sample - it's behaviour.  There's no need to second guess the market when you can just wander around it.  What does this mean in practice?  Well one thing is for sure.  When setting up a community, blog or social net, be aware that your guests won't be the people you invited.  But they will be the people you need to know.  Make them welcome.

P2P vs The Rational Consumer

Rory left an intriguing comment in the post below about brands in the Gift Economy.  "The thing about the gift economy, as you term it, (and free culture in general) is that in the world of the rational consumer, it doesn't work. And unfortunately (or fortunately if you create competitive advantage for a living) most brand owners (certainly in the music industry) are still doggedly following their yellow brick road to the fictional land of the rational consumer.  The gift economy, free culture, experiential marketing and customer engagement are all P2P concepts. These concepts simply don't fit most current brands. Most big brands and legacy agencies are desperately scrabbling around to save themselves with new creative concepts and marcoms strategies. What is needed is a more fundamental look at brand architecture."  My sense is that far from being 'concepts' P2P aka 'give a little take a little' is increasingly how people go about their daily business - at least online eg recommendation services.  So it looks like we're not in Kansas anymore.  The question is where does the review of brand architecture, that Rory refers to, actually start?  Any thoughts?

People Care About Markets, Not Industries

No one cares about the music industry.  But they really care about music, musicians - and the music marketplace.  They care about songs, singers, bands, DJs, gigs, clubs, forums, recommendations, discussion boards, MySpace, specialist dealers and obscure collectors.  And now the web lets people organise these things into the marketplace they've always wanted.  Which looks something like - free music supported by live gigs, merchandise and good quality recordings.  The music business (RIP) lost sight of the industry vs marketplace distinction along time ago.  After years of trying to protect their cathedrals, they ended up outsourcing the headache to Steve Jobs.  Who made a mint by ignoring the industrialists and rebuilding a lighter-whiter-brighter marketplace.  Now TV is trying to avoid the same fate of being stuck behind stone walls, throwing boiling oil at its customers.  TV's smart kids know no one gives a hoot about their industry.  But they do care about great entertainment, amazing actors, sensitive scriptwriting, powerful plots, celebrity glitz and inspiring drama.  In fact, they care so much that given the opportunity they want to get involved.  Just look at the success of the L-Word fanisode and LG15 (now EQAL), creators of the hits Lonely Girl and Kate Modern.  Both are examples of smart operators turning their backs on the industry, looking out into the marketplace (aka the bazaar) and reacting to what they observe.  But it's not all small studios hustling webisode craziness.  The Big Daddy of social networks - MySpace - has its own TV channel and just listen to its VP, Jason Kirk describe their approach: "We’re trying to decide what makes sense for our community. The video is often the catalyst, but it’s about how does it play into the community."  Or Amanda Goodfried, LG15 producer: 'The show is more than just a video series, it’s a universe, a full experience where viewers can become directly involved in the character’s lives.'  No industrial sentiment there.

Why Ads Don't Work In A Gift Economy

Online gift economies can easily sound like a load of kool-aid fulled, hippy nonsense.  But in fact, it's how we all operate day-to-day in the real world.  We give and expect to get back - but only at an unspecified future date.  Think regular drinking pals who don't count the rounds too closely because they know it all evens out in the long term.  By buying the beers when you've just been paid you are saving up a few gratis ales for when money is tight.  And we all know what happens to people who don't get their round in.  Eventually, they get thirsty.  The difference is that gift economies used to be restricted to tight social units such as the family, close friends or neighbours.  Now the gift dynamic is writ large across the world.  Networked media has created millions of small groups who are brought together by common interest but remain geographic strangers.  The surprise, however, is that our natural propensity to give-and-take translates into these online cliques and makes them tick.  If you link to the article I have been working on today, I'll be inclined to point at your post tomorrow.  If you add my photos to your montage and give me a name check, I'll recommend your artwork to my friends.  If you add my video to your delicious feed, I'll introduce you to someone helpful.  If you add a little juice to my P2P project, I'll make sure you are invited to that cool new event.  If you praise me, I'll defend you when your name is being dragged through the mud.  Through these small favours, back-pats, gestures, nods and winks, the strands of social networks are drawn together.  Groups unite and alliances form.  There's nothing new here.  It's as old as the hills in fact.  But when magnified through the distributed techno-bobbins that we have in our homes and on our persons, those small gestures and contributions grow into market forces that disrupt whole industries, causing big headaches for MegaCorps.  Think Skype's attack on the telecomms biz, McCool competing with enterprise tech, Fanning's assault on music or BitTorrent's steady disruption of the studios. All powerful market forces that kick-off with a small gift.  So how do brands work in such environments, where people want a favour not a fiver, a thumbs-up not a backhander?  Well, it's fair to say that advertising in its current form won't cut it.  In gift economies advertising is the equivalent of having dinner at your friend's house and leaving £50 on the way out, as the wonderfully hirsuite Yochai Benkler notes in this TED talk. It feels a bit grubby.  Gift economies work because someone is given a voice, made to look smart, introduced to a new friend, when their style is praised, their art is pimped, a door is opened or some light is thrown on a problem.  But just like the real world you have to give before you get and the payback is in the long-term.  Which makes it a difficult corporate investment to justify.  Especially while the short-term option of buying some 'loyalty' through media remains.  However, as the gift economy grows and challenges new markets, brands that can't operate in this forum might find themselves getting thirsty as those beers start to dry up.  Whose round is it again?