When Petrabytes seem like kilobytes - what comes next?

Affirmation is a great and positive word and I have been feeling some affirmation recently and here is another small slice

The concept of Web 2.0 is a dynamic, user-driven mesh of technologies

Absolutely, and Carlota Perez in her book Technological Revolutions and Financial Capital states that when separate technologies become interlocking they have a profound impact on the direction of economics, culture and wider society.

So the question was well - what comes next? Ubiquitous social computing and digital footprints means that we get a huge spike in data and so we become completely data-driven. The web (the 6th Mass Media) converges and becomes one with mobile (the 7th Mass Media )

Data will be the key . There will be independence from platforms, devices and the internet. Users might be able to collaboratively design websites and applications. The barriers between applications will begin to break down as portability between applications increases.

But it is more than just data - its what one does with that data, how one processes it - how one refines it and then deploys that intelligence. - This is called Social Marketing Intelligence.

In 6 feet of junk mail or a 29% response rate? Blyk shows the way We demonstrated the potential of refined data

Average response rate 29%

Average SMS response rate 41%

Average MMS response rate 22%

Really engaging communications consistently receive responses over 50%

So - firstly we see a disproportionate success rate when campaigns are Engaging but also an incredible mean average of 29%. Nick Fuller, Chair, DMA Mobile - 2nd November 2007 declared that

Response rates for cold [Mobile] campaigns are in the 3- 6% range while campaigns using client’s own customer data fare much better with response rates ranging between 1.3% and 20%

Recently we have seen churn rates at a large Telecommunications company reduced by 20% by using Social Links a subset and the DNA of Social Marketing Intelligence - Now that's a big number. Further with unique intelligence I think one can transform communications - Any communications - so that it becomes:

1). Timely

2). Relevant

3). Contextual 

Also, what many do not understand is that data when coupled to social networks analytics becomes transformational in what is communicated to whom and when - yes there are many data analytics companies out there, yet few I think have the ability to capture data that comes from many multiple sources, including the richest raw material of all - mobile data - and at volumes which make petrabytes look like kilobytes. Also however, data flows are dynamic like tidal waters - ebbing and flowing. Dynamic social data processing enables organisations to be responsive, fleet of foot. Traditional Media cannot deliver a captive audience anymore - so what can? And what type of audience is one delivering. I have argued we will move froma world of CPM's - Cost per Thousands to CPRA - Cost per Relevant Audience

In the advertising world, multiple shifts are piling on top of each other and it is often hard to keep track of them, much less understand their implications. says John Hagel Let’s look at just some that are re-shaping the advertising world:

1). Shifts from advertising placed in digital content to ads placed in social networks and applications
2). Shifts from digital advertisements delivered through conventional PC’s to a growing array of mobile devices, with an increasing ability to target messages based on the physical location of the person
3). Shifts in the behavior of digital users in their responsiveness to advertisements online
4). Shifts in the way that companies connect with and build relationships with stakeholders (e.g., blurring boundaries between customers, partners and suppliers)
5). Shifts in the revenue models for businesses, as online businesses in particular become more and more dependent on advertising as a key revenue source (e.g., is there any Web 2.0 start-up that doesn’t blithely answer "advertising" when asked about their revenue model?).

 Hagel goes onto say

The basic paradox of the Internet can be framed very simply: The very platform that makes advertising both more relevant and more measurable is the same platform that longer-term will challenge and ultimately undermine the basic role of advertising in communicating with customer. Exactamondo though he doesn't mention mobile - which is a bit of an oversight.  

This a map of a hierarchical social network. A beautiful image in its own right, yet it has something far more valuable to offer - Insight into how that network operates and how individuals inter-relate with each other. Understanding the social and communication dynamics of such networks will transform marketing/advertising and any other form of communications one cares to think of. And indeed what we find is that social data intelligence can become self-learning and predictive.

Social Intelligence is how we will Mind the gap as the circumnavigate the world from Analogue to Digital

Forrester in their report the Connected Agency believe that data will play an increasingly important role in marketing and branding and will in fact shape those organisations in the future.

Offer access and intelligence to brands and media                                                                                                                                                                                                  An agency will know which brands and content can enter and access community data. The agency will facilitate the interaction with the brand, and consumers will welcome agency involvement as the key to their independence. Brands like The Body Shop and Toyota will want to connect — and pay — for community entry, much as they would pay for media today. Similarly, agencies will broker content-sharing deals with media firms like Viacom to add targeted entertainment and information.  

And

Planning, strategy, and research become continuous                                                                                                                                                                                              Insights and consumer intelligence will constantly ?ow from the community — as from a 24×7 focus group. Agency sta? will be hungry for real-time results to see how a conversation is spreading and to drive future decisions. So agencies like OgilvyOne will adopt sophisticated enterprise marketing platforms (EMPs) and sta? up with data analysts to manage this knowledge and sell it at a premium to advertisers. 

They go onto say that these organisations will become community focused - communities are formed around meaningful social connections. Manuel Castells says that we must emphasise the role of technology in the process of human transformation, particularly when considering the central technology of our time, communication technology, which relates to the heart of the specificity of the human species: conscious, meaningful communication. Clay Shirky's book Here Comes Everybody and the wealth of other research and book titles are all affirmations of Communities Dominate Brands published in 2005.

Price Waterhouse Coopers in How Consumer Conversation Transform Business outline the following points again affirmation from our previous research

The speed and scale of consumer conversations can redirect entire markets

1). Monologue is a thing of the past

2). Conversation is the new source of consumer intelligence

3). We have to know how to analyse consumer conversation

4). The Market is ready (companies in all industries are actively seeking new tools and capabilities)

5). We need to develop the art of translating conversation into action

6). The new currency in advertising is the voice of the consumer

7). Companies can use consumer conversation to innovate

Indeed and as Labour MP Tom Watson wrote

The 19th century co-operative movements had their roots in people pooling resources to make, buy or distribute physical goods. Modern online communities are the new co-operatives.

Its a far cry from the straight lines of our industrial era and this is the result The world of set piece competition is over. In a hyper competitive landscape where reach is no longer defined by time or geography and as our economic and political landscape also evolves - companies will be required to ensure that they are prepared for the landscape that confronts them. Data and the ability to refine that data into unique intelligence will become a central component in competing for the future.

 A map of set piece competition

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Power Play on the Global Stage

The way that consumer power is shifting across the globe is going to significantly affect the way that brands maintain ‘relationships’ with their customers. The impact of new economic global powerhouses, coupled with the empowerment of ‘digitally fluent’ consumers means advertising has changed forever and communication with it.

Is a point of view that the Independent Economics Editor Hamish McCrae shared with me recently. Indeed - we have already posted about epochal change in The End of the Belle Epoch

The greatest shift of economic power for 150 years underpinned by 5 seismic shifts. This is not just about outsourcing or cheap imports, it is about an awareness of a different world

    1). Demography – how do we reach the "new old" 

    2). The environment – we all want to be greener  

    3). Globalisation – power shifts to Asia  

    4). Technology –  towards a global level playing field that has significant implications

    5). Government – spend less regulate more*

*Indeed we need to dig a little deeper into Governments role – There will be huge financial pressures as demands rise and revenues are cut away. Voters are consumers of government services and Government becomes an enabler nudging society towards greater personal responsibility. Well fingers crossed anyway.  

And here is the power play. Over the next few decades we will witness the inevitable re-ordering of world economies. Aditya Chakrabortty asked Is this the Indian century? whilst we see America struggling in so many ways , economically, spiritually and politically.

There are troubling signs across America that the deepening economic crisis engulfing the country is taking a terrible and historic toll on its people, as growing numbers of once-affluent middle-American families resort to desperate measures to make ends meet 

Lurking behind the headline-grabbing stories about the credit crunch, the US housing crash and the near-death experiences of Northern Rock and Bear Stearns , is the bigger one about the slump in the value of the American dollar.

So steeply has the greenback fallen in value against its main rivals - the euro and the Japanese yen - that economists are talking about the dollar losing its status as the world's reserve currency, a position it has held since 1945.

Below two charts that show the evolution of changing economic and with it the political climate 

The growth of China as a superpower constitutes the biggest challenge the world has had for more than a century. Never before in modern times has the financial, trade, economic and diplomatic world pecking order been so profoundly reconstituted with the challenger country itself in the grips of incredible ideological and political change. Listen to Will Hutton talking on China And of course India will not be far behind.

 The implications for us all are about:

1). The fight for economic survival

2). The fight for resources

3). The fight for talent – and for the best educated young

4). The fight for the space of mind of consumers   

The imperative to adapt our organisations to the networked world, harness the wealth of networks: to educate our young to properly compete, and to be able to play to our core strengths on the global stage has never been greater.

So what to do about it? Well we do have an advantage - if - IF - we embrace that opportunity fully. Yochai Benkler in the Wealth of Networks wrote

We need not declare the end of economics as we know it. We merely need to see that the material conditions of production in the networked information economy have changed in ways that increase the relative salience of social sharing and exchange as a modality of economic production. That is, behaviours and motivation patterns familiar to us from social relations generally continue to cohere their own patterns. what has changed is that now these patterns of behaviour have become effective beyond the domains of building social relations of mutual interest and fulfilling our emotional and psychological needs of companionship amd mutual recognition. They have come to play a substantial role as modes of motivating, informing, and organising productive behaviour at the very core of the information economy.

Whereby the technological revolution we are currently living through is changing the structure of markets, economics and the role that organisations have in those markets. The possibility of producing information, knowledge, and culture through social, rather than market and proprietary relations – through cooperative peer production and coordinating individual action – creates the opportunities for greater autonomous action, a more critical culture, a more discursively engaged and better informed republic, and perhaps a more equitable global community.

This could well be how we compete in the future - who wants to live in a society that dictates, who you are, what you do, where you can and can not go? Etc., 

As Marcel Proust wrotes

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DoubleClicks view of the future

An interesting and indeed an engaging set of videos which are well worth looking at how media is evolving, how TV and the web will converge, how we will go increasingly mobile, how search and discovery will transform advertising buying and selling.

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How consumer conversation will change business using Social Marketing Intelligence

Prive Waterhouse Coopers have published a report How consumer conversation will change business

One consumer voice can morph into a community in minutes. Are you listening?

They say - The speed and scale of consumer conversations can redirect entire markets - is the argument

Imagine it’s seven o’clock on a Monday morning. You turn on your computer. On the screen is a startling level of insight into the real-time attitudes, behaviors, and intentions of your consumers. By knowing why people buy, you know where markets are going. This insight informs every decision you make as an organization. Every hour of every day, you are able to solve performance problems before they become financial problems, and your customers help you innovate well in advance of demand. This Monday morning is coming. In billions of chats, blogs, emails, phone calls, and social networks, consumers are talking about your business. Somewhere in this massive conversation are shouts and whispers that will determine your success or failure.

It called Social Marketing Intelligence The report goes onto predict

For the first time, methodologies and technologies exist that can interpret unfiltered, real-time consumer conversations. These dialogues contain a granular, forward-looking understanding of consumer attitudes, needs, and behaviors. And they can be combined with other existing behavioral and transactional information (such as Web surfing patterns and point-of-sale data) to create a completely new and previously unattainable view of your markets. To realize this potential, companies need to do more than collect and analyze data. Maximizing the value of consumer conversation is a matter of organizational as well as technological change.

And

Adjusting to these new methodologies and technologies will require time, trial, and investment, but the benefits will be absolutely enormous. Companies can already use real-time consumer feedback to improve products, sales targeting, segmentation, customer service, and crisis management. Those that merge disparate channels of consumer data and embed them into operations will also discover the missing
inks between buying history and buying intention. Executives will hear consumers whispering about new and expanded markets and react to these shifts “ahead of the curve,” realizing faster sales growth, reduced risk, more efficiency, and higher customer retention.

SMLXL has been involved in some large customer trials recently and we see a 20% decrease in churn by using Social Marketing Inteliigence - wiki

PwC also mention the 100 fold increase in connectivity that with fuel the explosion of networked conversation and interaction

In the next five years, there will be an explosion of global conversation in developing countries. The biggest gains in both social networking and blog use are likely to occur in Brazil, China, India, and Mexico. 2 Our own research, both in the US and developing countries, corroborates this point, and we have seen a definite trend over the last several years wherein social and interactive media have taken on increased significance in the lives of consumers.

Xtract say that 65-70% of all purchase decisions are influenced by word of mouth

Consumer opinions are the most trusted source: In Taiwan, Jason Lai, a 25-year-old engineer, says, “I am a big fan of checking out feedback on products before I purchase them. I find consumer opinions more reliable than ads.”

As a consequence Marketing capability will be transformed aligning IT with the business’ is yesterday’s challenge said Information Week, and that, aligning IT meticulously with external and internal customers’ needs…is now the end game for the most astute companies.

Bill Bailey is a comedian and he is asked how he comes up with his jokes? Bill says I start with a laugh and work backwards. In the same way companies need to be customer centric and Engagement sits at the very heart of that process.

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Its the small things that keep communities together

Just imagine you are part of the government. Among your principal concerns are how to hold society together at a time of rapid change. You worry about social and community cohesion and the practical, psychological and economic isolation of the elderly, the disabled, rural-dwellers and the poor. You set up a Department of Communities and spend billions on initiatives to create thriving, sustainable communities that will offer a sense of community, identity and belonging. Sustainability is another key concern. You care about the planet and exhort people to make fewer car journeys and walk or cycle more.

You inherit, all around the country, a network of local offices which happen to provide many of the functions you seek. They give people access to cash, benefits and government services, as well as connecting them through the post. The majority are combined with a shop, which makes them a social hub and meeting point. The postmasters who run them are an informal source of support and advice on everything from benefit claims to what to do in the event of a death. In cities almost everyone lives within half a mile’s walk of one, and frequently their presence is what sustains a small shopping parade. In rural areas they allow people to lead local lives, and are often the last service left in places that have been steadily stripped of buses, shops and schools. So what do you do? In the name of economic efficiency, you take government business out of their hands, and then start closing them down, in their thousands.

Writes Jenni Russell as she argues In the name of supposed efficiency, politicians are destroying a vital social network that helps us live green, local lives

Thats the local Post Office then 

I asked the Post Office press officer what the company’s mission was. “To go into profit by 2011,” she said. What about community needs? “You’ll have to ask the government about that.”What is so outrageous about this strategy is that the government is acting within completely artificial constraints. Separating the Post Office from Royal Mail 20 years ago, removing key functions five years ago, and defining the network as a business, are all political decisions, not a matter of economic fact. In this area the government is acting as if it were a commercial board, for whom making profits is the sole definition of failure or success. It is nothing of the sort. Politicians aren’t running Tesco; they’re providing public services. I don’t see a demand for profits from the army, road building, hospitals or schools.

Post Offices have that important Social Capital that helps Communities work - drop into our local Post Office/Newsagent people stop to chat - etc.

Social capital, referring to connections within and between social networks, is a core concept in business, economics, organizational behaviour, political science, public health, sociology and natural resources management. Though there are in fact a variety of inter-related definitions of this term, which has been described as “something of a cure-all” for the problems of modern society, they tend to share the core idea that social networks have value.  

L. J. Hanifan, state supervisor of rural schools in West Virginia. Writing in 1916 to urge the importance of community involvement for successful schools, Hanifan invoked the idea of “social capital” to explain why. For Hanifan, social capital referred to:

those tangible substances [that] count for most in the daily lives of people: namely good will, fellowship, sympathy, and social intercourse among the individuals and families who make up a social unit….The individual is helpless socially, if left to himself….If he comes into contact with his neighbor, and they with other neighbors, there will be an accumulation of social capital, which may immediately satisfy his social needs and which may bear a social potentiality sufficient to the substantial improvement of living conditions in the whole community. The community as a whole will benefit by the coöperation of all its parts, while the individual will find in his associations the advantages of the help, the sympathy, and the fellowship of his neighbors. 

Robert Putnam Bowling Alone : The Collapse and Revival of American Community

In France, La Poste has an explicit social function, connecting people to the government by maintaining a state presence in all areas, particularly rural or disadvantaged ones. It has flourished by diversifying into providing local authority services, finance and railway tickets. Here, as a select committee report warned last month, the government’s attitude means that the long-term future of the network depends on the entrepreneurial flair of Post Office Ltd, “which has not been conspicuous in the past”. Says Russell

 Then we get Blears wants police, NHS and councils more locally accountable
‘Empowerment’ white paper unveiled today  - Proposals include rewards and compensation

So on the one hand we are ripping up the little things that create social capital and community and then on the other try and make others accountable

Ministers regard the community empowerment proposals as potentially the best way to re-engage the public with politics - such as by placing a duty on local government to promote democracy. A new government survey to be published tomorrow will show six-in-10 people do not feel they are given an adequate say on how council services are run, while more than 90% of people believe the accountability of councils could be improved.

One wonders if the right hand knows what the left hand is doing? Because

In 2006, 4 million people signed petitions against closures - that’s four times as many as marched against the Iraq war. Last year the government invited responses to its plans and had an unprecedented 2,500 submissions. Reading the weasel-worded summary of that consultation you would imagine that the majority of respondents sympathised with the official arguments. I suspect that’s sheer misrepresentation. Of a random sample of 40 responses, all but one were deeply opposed to the strategy, and in many a sense of near-desperation was evident. 

Yet even so Post offices face sell-off to rival firm and are Run down and parcelled off

Then we get that great community company WHSmith offering its premises to replace the social capital of the local post office  Go figure

Who does the UK government work for? we recently asked at Communities Dominate Brands

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Evolution of SMLXL

In 2002, I founded a company called SMLXL - short for Small Medium Large XtraLarge.

Its focus was and still is - how do businesses and organisations meaningfully engage in a commercial or social agenda with their audiences.  We were some say before our time and the result of our early work was the book entitled Communities Dominate Brands - published in 2005. Today - you can't open a page to read about another industry facing serious challenges in this period of epochal evolution, or how mobile and digital are transforming communications before our very eyes.

Today - we are increasingly asked to use our knowledge and insight to help companies and organisations navigate the divide between a mass media analogue world with its own rules, logic and business models to the new universe of the digital one.

The new evolution of our site we hope will provide greater value for all those that are interested in what SMLXL does, what it thinks and what it has to say.

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meltdown

The SMLXL email has had a virus which has wiped our database

please contact Alan @ alan (dot) smlxl (dot) gmail (dot) com

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Is British Television at a tipping point?

Powerful comment from Will Hutton… British TV must be saved for the nation

British television is at a tipping point. Every night, our screens are filled with programmes that represent two conflicting traditions. On the one hand, we see examples of the great television culture Britain has created over the past 50 years. Use the remote and you get the new trash which threatens to spread throughout the networks. There are still many great programmes to watch, and much creativity on display, but unless something changes, our culture and civilisation are about to be seriously impoverished.

But it gets worse
Continue »

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Business 1.0 circles Business 2.0

Reports the Chicago Tribune: YouTube deal leads to surge in online speculation
The future of business: social networking? But what does that exactly mean?

Should an Internet arms race begin, it will likely be fought over online audiences. Building a large Web following is hard to do, and many of the big public Internet companies will seek to buy what they have had trouble creating: new-generation social-networking sites with large followings of users who spend time posting videos or creating their own Web pages. For example, Google's interest in YouTube was likely sparked by the failure of its own video site ? Google Video.

The cash pours in

Venture capitalists have anticipated the interest in Web 2.0 companies and have poured funds into start-ups. In the first half of the year, they put $262.3 million to work in 49 deals, according to VentureOne, a division of Dow Jones & Co., already surpassing the $199.1 million and 51 deals of all of last year.
A persistent theme behind their investing has been sites with user-generated content–from blogs to videos to Web pages with photos and family information. Now they hope for a Google-inspired spending binge.

The question is however, can you buy communities? And I believe that in fact many companies can build their future, not by buying, but by building. By trying to get to grips with what all this peer to peer flow of communication is all about.
On our blog we have reported on a wide range of examples that demonstrate that whether it be the harnessing of collective intelligence for scientific purposes, to multiplayer online gaming, to mobile, to entertainment to folk culture and beyond
what will we end up with - too many me-too's - if we all say "I want one like that."
What we should be saying is - This is who we are, this is what we do, how can we create something that will ATTRACT our stakeholders, our audiences, that creates genuine value that we can develop over time.
Look at the news and media groups Tribune awaits bids as sector's woes mount and Media Old World - Media New World and Why is mobile social networking worth $3.45b?
I admit it is complex, because there are so many issues to consider - but the real skill is to craft somethig of value, build it from inside out, because that way the learning enters your own 1.0 orgainsation, and there is a collective cognitive learning which benefits the entire organisation.
It might be better to run a series of workshops to explore what your orgainsation could be doing in this space and what skills you need to get there, rather than going to buy something you don't understand.
SMLXL are currently working with a number of companies to explore how they can build, adapt and attract. In a world of business 2.0
You can always drop us a line if you would like an outline of our workshop approach.
Just a thought.

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Master class Alan Moore - November 20th

Motivaction in Amsterdam have asked me to undertake a presentation, Masterclass and discussion around our book. The CEO Piet Van Dam writes

With people coming across at least a thousand brands a day, how can you make sure that they will notice yours? Motivaction invites marketers and strategists for a master class with Alan Moore, co-author of the book Communities Dominate Brands. His razor-sharp observations, surprising insights and inspiring examples will introduce us into the age of community marketing.

Our parents grew up with product marketing, we were raised on brand marketing and our kids live in the world of community marketing. What does this world look like? And what does it imply for us?

Moore is going to make us familiar with the business and marketing challenges of the 21st century, keywords being: communities, relationships, engagement. You are invited to listen to Alan Moore and enter into a discussion with him. There will be plenty of opportunity for further discussion during diner afterwards.

The master class will take place in restaurant_bar_club 11, near Central Station in Amsterdam (Oosterdokskade 3-5) on Monday November 20th, 2006, from 16.30 - 21.30 hrs.

You can subscribe here

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