Seasonal Change

| November 8, 2010

Living in the Midwest means that we have to adopt to seasonal change 4 or  more times per year.  I say 4 or more, because our climate can go back and forth between seasons on an ongoing basis.  Yesterday the temperature reached 60 degrees in our area.  The forecast for next week is projecting temperatures in the mid-40’s.  Snow is in the forecast also.

How is this relevant to business?  With seasonal change comes a shift in both consumer and business behavior.  This is the time to review the current years business performance.  This is also the time of year to begin serious conversations about what direction you want your business to go in 2011.  I’m amazed that many business owners do little strategic planning or wait until they are well into the new year before they start to think about their operational performance and sales strategies for the year ahead.

Now is the time to review your business performance.  Now is the time to begin scheduling meetings with your key business advisors to start the planning process for next year.  You’ll appreciate it, your staff will appreciate it and most important of all, your customers will appreciate the clarity and operational alignment of your business when they arrive to do business with you.

Open Social Networking

| September 25, 2010

By Mark Lenz

I had a great conversation today about social media that inspired me to share my thoughts on social media and its future, an open and distributed network that reflects the intent of the Internet. Everyone on The Business Source team met for an extended lunch to discuss our goals for the next few months. One of the major focuses in our discussion was helping businesses get the full potential from their social media efforts. Social media can be a valuable marketing tool, but many businesses run into issues utilizing the tool and integrating it into their overall marketing strategy. Laurel Cavalluzzo, owner of Madison Marketing Communications, has joined our team to use her knowledge and experience to provide sound, valuable advice on doing just that.

If you know me you know I have a few qualms with social networking sites. If you don’t know me, it may be because I’m not on Facebook. Maybe it’s the engineer in me since 85% of engineers don’t like Twitter. I admit I just started using LinkedIn and social networking sites can be useful, but they also have their disadvantages. One recent example is the latest attack on Twitter by an Australian high school student which wasn’t malicious but could easily have been. The main issues I have with the current state of social networking and media is security, ownership, privacy, redundancy and censorship. In fact, even though site membership has increased, users are hardly satisfied with current social media sites according to the American Customer Satisfaction Index. So given my feelings you can begin to imagine where our social media conversation went.

Laurel responded to each of my inquiries with precision, but with so many other interesting and important topics to discuss there was little time to share my complete vision, nor I’m sure Laurel’s. I believe that social media is a very important new communication and archival vehicle, and we’ve only seen the very tiny tip of a very large iceberg. Not to sound prophetic, but I think “Web 3.0” is nearly upon us and it includes full integration of social media and traditional websites through an open social media network. We can solve many of the issues with social media by developing and harnessing an open network, and there are many additional benefits to an open network.

Security

The most critical concern of any business should be protecting its assets. Social networking sites are famous for their lack of security. From attacks similar to the Twitter attack that take control of users’ accounts to users themselves leaking sensitive information with and without intention. A recent article describes many of these problems faced by small and medium businesses, costing many businesses upwards of $5,000 in the first half of the year. That’s just another unpredictable cost of using social media sites, and with everyone’s accounts in one place it makes for an easy decision when choosing targets to attack.

As an example of the fragility, a few days ago Facebook was mysteriously offline twice in 24 hours, and the lack of security with regard to the U.S.’s networks is one of the NSA’s top concerns. The NSA chief and head of the U.S. Cyber Command recently told reporters he wants to create a secure partition of the Internet to protect our most vital infrastructure. One attacker could get millions of users’ private information with one attack. Issues with security will probably never be completely solved, but we can continue to improve.

Ownership

The ownership of intellectual property, the text, images, video and music you post, is another major issue with current social networking sites. Currently, sites such as Facebook will continue to publish your content long after you’ve removed it. When you post content on these sites you agree to allow them to use the content in nearly any way they wish. I am not familiar with the terms of use for corporate accounts on social networking sites, but clearly there are implications for personal use and there’s no reason to expect them to be any different for businesses. Facebook has had many issues in the past, and even though they may not keep all of your data for whatever purpose forever, they can change the rules at any time.

The ways in which you can use your content on a social networking site are governed by the how each site is designed. None of the social networking sites make it easy to swap content between sites or export it to other media. When a social networking site becomes obsolete, as MySpace has, all of your content, friends and likes are stuck on that site and you have to rebuild your profile and connections on another site. If I were a betting man I would wager that Facebook won’t be the social networking site du jour forever, and the new Google Me or Apple Ping could be the replacement. Businesses haven’t been the first-movers in this space. So businesses will eventually be forced into paying to rebuild their status on a new site once a critical mass has migrated. If we could retain control of our content by hosting it ourselves, or through web hosting providers, issues over ownership and portability would not exist.

Privacy

Privacy issues arise in part because of a lack of security but also for various other reasons. Facebook has dealt with many privacy issues in the past. Many of the issues were due to features created by Facebook to increase the sharing of user content and from changes in privacy settings. Google Buzz launched to loud criticism because of the amount of private information that it automatically shared. Since you have little control over how your content is shared and displayed on social media sites, and many settings can be buried under layers of obscure menus, you may not know exactly who can view which elements of your profile or how to change those settings. I don’t think these issues will be solved by incremental changes to the current social media sites.

Though social media sites have made progress to protect private data there continue to be privacy concerns. Software techniques called machine learning can be used to infer many surprising and private things using the data collected from you and your friends’ public content. Not only is your public data and behavior being tracked, but the sites and applications you use also track your private data. The same machine learning techniques used with your private data can infer even more things about you with an even higher degree of accuracy. Since your content is hosted and controlled by a third party it is difficult to control and know exactly how your content is used. Clearly retaining control of your own content would streamline social media.

Redundancy

Current social media sites are horribly redundant. Not only do you have to waste time sifting through the abundant noise on social media sites, but you also have to waste time replicating the same content across your website and potentially several social media sites. To make matters worse, replication is manual since none of the sites provide a feature for exporting your profile and content. Third party tools can be used to alleviate some of the pain, but they add another layer of complexity and potential for more security and privacy issues. Also, there is no simple or standard way to integrate social media from each site into your traditional website. Integration generally consists of links between social media sites and a business’s website, and though this is useful, tighter integration has the potential to increase the quality and timeliness of communication. By removing the redundancy you have more time to focus on your message and effectively communicating it.

Censorship

Nearly every social media site has censored user content at one time or another for one reason or another. This can be a touchy subject, but I feel that the community should decide what is appropriate instead of just a few people. One way to reduce freedom of speech violations is to make this decision open and transparent to the extent it is for hosted websites, which in the U.S. websites aren’t taken down without a court order or DMCA notice. An open and distributed social media network would be systematically identical to the traditional website network, providing the means to a more open decision-making process.

Open Social Networking

So it’s clear there are some significant issues with the current state of social media. Will the current social media sites fix these issues? They will probably fix many over time, but the reason these issues exist now is the reason they will persist in the future. Their profit comes from displaying our content, not protecting it. So they need to exert some control. It’s not good or bad, it’s just the way it is.

However, as a society I think we can and we want to do better, and we can do it by developing and harnessing an open and distributed social media network. Such a social media network would consist of an open source software platform that is installed and run in the same way as a webserver. In fact, you would replace your webserver with it. Instead of everyone communicating on sites such as Facebook, you’ll communicate on your website, and you’ll be able to search your entire social network from your website. You’ll be able to easily integrate photos and videos from your friends’ websites into your website and vice versa. You’ll control who sees what content and how. You will have nearly complete control over your virtual presence. Sounds awesome, right?

Security risks would be significantly reduced due to the sheer number of people that are self-motivated to improve the security of the platform who would be looking for issues in the relatively simple code. This has been shown to be true in many large open source projects, which I assume such a platform would become. Also, since the network would span the Internet, there would no longer be one point of failure. You wouldn’t have to worry about the security of a third party social media site, freeing you to add more focus to your efforts securing your own website. Security issues will still exist, but an open social media platform would allow you to more effectively protect your online and Internet-connected assets.

Ownership of content and privacy are basically non-issues with an open social media network. Everyone with a computer and an Internet connection could easily host their own social media site linked to the entire social media network, allowing you to retain complete control of your content. The software would still need to be developed with enough granular control, but given that it would be open source that’s practically inevitable. So if you want what happens in Vegas to stay in Vegas, or at least away from Grandma, you have that control with an open social media network.

Social media would no longer need to be redundant with an open network. An open social media network and platorm would let business and personal websites merge with social media. Gone would be the days of checking and updating your website, blog, Facebook, Twitter and LinkedIn pages. Instead they can be rolled into one social media website linked to the global social media network. Think of the amount of friends and followers you can accumulate from that pool!

Realization

So if this open social media platform blathering really makes sense why aren’t we doing it? Well, some people actually are. Four students from the New York University’s Courant Institute of Mathematical Sciences, Dan Grippi, Maxwell Salzberg, Raphael Sofaer and Ilya Zhitomirskiy, found funding through Kickstarter and developed the platform they call Diaspora. If I were to bet again I would say that they and many others have had similar thoughts as myself. I applaud them for taking the initiative and turning ideas into reality. The Diaspora project will definitely kickstart the creation of an open social media network, and it’s already doing so. I’m seriously considering becoming actively involved in the Diaspora project, if at the very least by creating a presence on the network, but I say that only to try to express my confidence in the project’s direction. Regardless of any involvement from me, Diaspora will become the realization of an open social media network.

Neither Diaspora nor the idea of an open social media platform is perfect, and they are bound to create other issues, but it’s progress, open and transparent. Since the software behind Diaspora is open source, development happens transparently and critical security issues can be quickly discovered and resolved. Within two days of releasing the source code for Diaspora many critical bugs were discovered by outside developers. Diaspora isn’t the last such open platform to be created either. In fact, it will probably spawn many other platforms that will link to the same network. You won’t have to use each platform but instead pick one platform to create your social media site that will link to the global social media network. This should also increase competition and innovation as different platforms create distinguishing features to compete for your use.

It will take some time for the world to migrate to an open social media network. Migrating to a new social network requires a significant amount of effort and motivation. There must be enough compelling reasons for enough people to switch to reach a critical mass. It’s happened at least once before. I outlined a few compelling reasons for an open social media network, and there’s bound to be more. Yet there is one more roadblock, Internet bandwidth, not so much for businesses who already have websites but for individual users who currently rely on the social media sites for hosting. The bandwidth required to host a site increases with increased traffic. That means if you want a lot of friends with a lot of conversation you may need more bandwidth than most households can access. However, web hosting is a low-cost solution to the lack of bandwidth that individuals can take advantage of, and none of these issues are show-stoppers.

Don’t start closing your Facebook and Twitter accounts yet. Diaspora isn’t quite ready for primetime, but it won’t be long and more like it will follow. So dust off your social media strategy because social media is about to become an integral part of every business’s marketing toolkit.

Originally posted on the Code of Intelligence blog.

Collective Vision

| September 21, 2010

Collective Vision
by Mark Lenz

Recently I gave a talk on a few research papers that reflect an idea I like to call collective vision, the process of using the billions of images on the Internet with computer vision algorithms to learn information about our world. The text on Internet web pages has been scoured for years to infer many different things from the relevance of websites to the level of buzz for a product. The billions of photos and images found on the Internet provide another large resource of data that until recently hasn’t been tapped, and the potential for new insights is increasing with the proliferation of websites such as Flickr, Panoramio, and Facebook. Mobile phones with cameras make it easy for everyone to capture and upload photos, increasing the amount of available information every second.

There are a few research groups diving into the sea of Internet images, funded mainly by Microsoft, Google, and Nokia. I think the first novel use of Internet images was by Hays and Efros at CMU in 2007. They used a huge database of Internet photos to attempt to convincingly fill holes in photos, scanning the database for photos with similar regions to fill the hole. The Community Photo Collections team at the University of Washington developed the system they call Photo Tourism, which was the first system that can automatically reconstruct and visualize 3D scenes using photos gathered from the Internet. Further work has gone in to speeding up the reconstruction process to enable the reconstruction of full cities. Google uses photos from the Internet to power part of their Google Goggles search as well as a world-wide landmark recognition engine.

Collective vision could be used beyond reconstruction of the world and filling gaps in photos, and it can apply to other large sets of images that may not be collected from the Internet. In the short term, collective vision could aid in social tourism, something I’m investigating as a final course project, or it could help in disaster relief. I think some longer-term possible uses could be detection of infrastructure in need of repair or tracking and prediction of fashion trends. Other researchers and groups have begun investigating the potential of collective vision, and even more have shown an interest in it. So with tons of potential uses and lots of minds, it won’t be long until someone finds another novel use of collective vision, and then there’s video.

Originally posted on the Code of Intelligence blog.

Marketing Strategy: Buddy Up

| September 18, 2010

By EMILY MALTBY of The Wall Street Journal

Mountain News Corp., which tracks snow conditions for ski mountains through its website, got a burst of national exposure without spending a penny last winter when Apple Inc. chose to feature Mountain News’ mobile-phone app on an iPhone television commercial.

Before the commercial ran in February 2009, the Orinda, Calif., firm was pulling in 1.2 million unique visitors a month to its site, OnTheSnow.com. A year later, that number had jumped to 2.2 million, which the firm’s global managing director, Chad Dyer, attributes in part to the free advertising. “There was nothing we had to do, nothing to spend,” says Mr. Dyer.

Small companies generally keep tight tabs on advertising and marketing expenses, as the payoff may be uncertain. About 40% of business owners reported earlier this year that the economy was preventing them from spending on marketing and sales, according to a survey released by American Express OPEN, the company’s small business division.

Birds Barbershop split the cost of its ad campaign with Lone Star Beer.

Sharing the Spotlight

While most small businesses aren’t fortunate enough to be able to latch on to the campaign of a big company like Apple, some business owners have found ways to reduce marketing costs by sharing the spotlight with another company.

In May, Birds Barbershop in Austin, Texas, launched an advertising campaign with Lone Star Beer, which is owned by Pabst Brewing Co. The ads, which are running in local print and online publications, show a customer sporting a new hair-do and holding a beer. The ads list the price of the haircut and indicate that the beer is complimentary.

The barbershop has been serving a free beer to customers since 2006, says Michael Portman, who co-owns four locations. Lone Star had already been supplying the barbershops with cases at a discount price, and was game to split the cost of the ads.

The most expensive ad, prominently displayed in a bi-monthly Austin magazine, cost $900. Without a partner, Mr. Portman says he probably would have chosen a more modest ad. “I wouldn’t make that leap alone,” he says.

AssociaDirect Inc., which provides customized marketing tools to help organizations reach new members, is in the process of sending out more than 2,000 direct mailings to potential customers advertising a new marketing application for mobile phones. AssociaDirect’s chief executive, Michael Faye, says the firm is splitting the $3,700 cost of the mailings with mobile technology company ConnectMedia Ventures, which will help create the application.

AssociaDirect is the only firm being advertised on the fliers, even though the two firms will collaborate for each project—AssociaDirect will create the design and ConnectMedia will provide the tech support. AssociaDirect will pay ConnectMedia for its portion of the work.

‘Sales Arm to His Product’

“My partner understands that we are the sales arm to his product,” explains Mr. Faye, who says he has since landed six appointments with interested organizations. “I don’t have hundreds of thousands of dollars in my marketing budget.”

FirstBank Holding Co. ran seven billboards throughout Colorado in the latter half of 2009 showing off its entrepreneurial customers. The billboards listed the services each entrepreneur provided—math tutoring, wedding singing and dog walking, among others—and included contact numbers. The bank’s logo and a message about catering to small firms was at the bottom.

‘I Didn’t Lose Anything’

But even free publicity may have no end result. Math tutor Travis Macy, who is also a high school teacher, says he didn’t land any new customers despite getting a flurry of inquiries from the bank’s billboards. “None of them were a suitable client because of time constraints or subject matter or price,” Mr. Macy says. “But my investment was nothing…so I didn’t lose anything.”

Cost isn’t the only consideration in a collaborative ad campaign, says Paul Weber, president of Entrepreneur Advertising Group LLC., in Kansas City, Mo., which specializes in small-business marketing. One risk is whether the brands can coexist and, if there are multiple partners, whether the brands dilute each other. For example, a mail campaign that contains a stack of individual coupons isn’t as beneficial as a campaign that focuses on the businesses as a collective community.

“If you’re sharing the cost of a rotating billboard, [audiences] can separate the two,” he says. “But if you are putting them together and telling customers that if you like this, you’ll like that, make sure to do your due diligence.”

Your Time is Now

| September 13, 2010

Now is the time to invest in your marketing and customer development programs.  With the elections near and all the media hype associated with elections, global politics, terrorism and the troubles our country faces, it’s easy to understand how people can slip into a negative mindset.  I’ve heard that thousands of people in the United States are quietly sitting on billions of investment dollars, hedging their investments until “the economy improves”.

Guess what.  This is how the economy is.  It is what it is.

It’s been proved historically that companies who invest in their marketing and customer development process experience larger sales gains as the economy continues to stabilize for future growth.

We all know that our path to success with our businesses will be determined by our ability to plan forward and design new ways to achieve greater levels of competitive advantages and positive points of differentiation that appeal to our prospects and customers.  We need to communicate our core competency and how it resonates and is relevant to the needs of our customers.

Here are two good articles on the subject that are must reads.

Harvard Business Review – “Roaring Out of Recession” written by Ranjay Gulati, Nitin Nohria, and Franz Wohlgezogen.   http://hbr.org/2010/03/roaring-out-of-recession/ar/1

iMedia CONNECTION – “How brands thrived during the Great Depression” written by Dave Chase.  http://www.imediaconnection.com/content/20821.asp