The Grateful Dead invented freemium

According to John Naughton

Now spool forward again to today, when the angst du jour is how to get people to pay for online “content”. Once again, the most perceptive insight may come from the music business – specifically from an iconic 60s band, the Grateful Dead, whose archives have recently been donated to the University of California at Santa Cruz. Marking the event in a recent article in The Atlantic, author Joshua Green reminded us of how the Dead pioneered ideas and practices that are only now being reluctantly embraced by corporate America. “One was to focus intensely on its most loyal fans,” Green observes. The band “established a telephone hotline to alert them to its touring schedule ahead of any public announcement, reserved for them some of the best seats in the house, and capped the price of tickets”. He adds: “Only in the 1980s, faced with competition from Japan, did American CEOs and management theorists widely adopt a customer-first orientation.”

Quite so. More significantly, though, the Grateful Dead decided that they wouldn’t try to stop people making bootleg recordings of their concerts, figuring that what they lost in royalties would be more than compensated for by being more widely known, and by the resulting sales of merchandise. It turned out that they were right. The band anticipated by decades the “Freemium” business model now being touted by expensive managerial gurus. Stand by for a best-selling business book entitled Management Secrets of the Grateful Dead. And if you want to know the future, ask a musician.

And I pointed out that it was a newspaper that invented the Tour de France to sell more newspapers, and yet traditional media seem completely in thrall of god knows what unable to reinvent themselves. Clinging to the wreckage in hope of salvation.  Ten years ago SMLXL called such activity that, the Dead, or L’Equip undertook to achieve their commercial success engagement marketing.

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Posted in: Engagement Marketing

Tohato – one of the greats of engagement marketing on mobile

Perhaps one of the most innovative FMCG launches anywhere – whilst others think that Buy One Get Free will suffice, Oh Well.

Tomi Ahonen, my co-author of Communities Dominate Brands provides insight into the mechanics and success of the launch. And one has to ask is this the future of marketing – well for my money this looks a lot more attractive than another poorly conceived, badly written and executed 30 sec spot – or an idle banner ad, that pretends to look important – but really isn’t.

Tohato used Japanese ad agency Hakuhodo to create the launch campaign for the new snacks. And what a campaign they designed, indeed. They designed a massively multiplayer online game (MMOG). Not only that, but their game ran on mobile phones – another relatively rare phenomenon in the MMOG space, most MMOGs like World of Warcraft, CounterStrike and Lineage 2 are designed for personal computers.

Once in the game, gamers were encouraged to recruit friends to join that Evil Army. The recruiter would gain promotions in the army depending on new recruits, and their recruits. A classic pyramid scheme and remarkably viral. A private was promoted to sergeant, then promoted to lieutanent, then to captain, etc.. The armies had 31 battlefields to win the World’s Worst War. These had again really appealing names for this generation, like Sweet Sucker’s Execution Hall, the City of Anal Torture, and Shadap Bay. Remember the target audience, this is exactly the kinds of names that are cool to them. They generated enormous traffic, 100,000 page views per day. And the game had a 24 hour news alert service to inform gamers what was going on, who died, which team won the latest battle, who was promoted, etc.

Christopher Billich from Infinita gives us some more info,

Players were rewarded with more than 120 collectible wallpapers,for capturing bases, including some very hard to get ones that could only be obtained by players that met a number of objectives. They actually did three installments of this game between October 2007 and April 2008. By the last installment, the game mechanics had become quite sophisticated, including training your soldier (on site, once a day max.) to boost his powers, rank not only depending on the number of people recruited, but also on battles fought/won etc.

It also featured an intricate system of gaining/losing “information points” by posting strategically relevant information to the own army’s BBS and eavesdropping on the other side’s conversations, which I thought was pretty cool. You could even defect to the other army if you saw things going downhill for your side.

Tohato demonstrates, how to make advertising money work hard, to attract, engage and change behaviour. It also drives advocacy and word of mouth. It also demonstrates the binding power of co-creation communication strategies, and frankly I have become bored as to whether the media bean counters can count this type of activity. The you just need to look at cost of investment for the campaign and the sales that are directly attributable to that investment.

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Posted in: 7th Mass Media, Advertising, Engagement Marketing, Engagement Mobile, Generation C, Marketing, Media, Mobile, Participation, Uncategorized

Advice for entrepreneurs

Address pain points in society to do good and do better

Entrepreneurs looking for growth opportunities should begin by identifying ‘pain points’ in society, say INSEAD Professor Subi Rangan and Shantanu Prakash, the founder of Indian educational company, Educomp Solutions.

In the quest to address that pain point, Prakash set up Educomp in the mid-90s, becoming one of the India’s ‘youngest billionaires’. Educomp’s motto is ‘What learning can be.’ Among other services, the company provides technology-based educational solutions to thousands of schools across India, and is also involved in teacher and vocational training.

“Essentially I think the system is dysfunctional,” Prakash says. “And so when we looked at the system we saw opportunity and we said there is a better way of doing things. And we decided to use technology as an enabler, as a method by which we could improve the existing system. That’s how some of our innovation in the area of multimedia education and even distance learning came about.”

Via INSEAD Knowledge

And,

Rangan says the economic paradigm is changing from a self-regarding, instrumental capitalism to a substantive capitalism, which couples society with the market. In essence, it’s deepening the corporate citizenship role of business enterprises.

“Whereas the Schumpetarian entrepreneur starts with gain, my entrepreneur starts with pain,” he says. “They look at the pain in society and ask ‘how can I now make a business of addressing that?’”

Educomp’s Prakash did just that, building a company which today has a market cap of around 1.5 billion dollars.

Not bad and a valuable lesson to those that what to make money in the 21st Century. So, Prakash states

“I fundamentally believe that businesses of the future that operate in some of these areas like education or health or clean technology, will have to take an important decision about how they price their products, how they deliver (them), so that they can meet the aspirations of their consumers. And in meeting the aspirations of their consumers on price points and on quality and other parameters, they simultaneously meet the expectations of their shareholders and investors.” And his advice to other entrepreneurs? Look for society’s pain points.

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Posted in: Economics, Society, Strategy, Trends, Web/Tech

Book review: monkeys with typewriters

A year or so ago, I get a call from a lady called Jemima Gibbons who wanted to meet me to discuss how one went about writing a book – so we meet up in my favourite haunt at RIBA and had a chat about what Jemima saw as a significant challenge.

Her book Monkeys with Typewriters: myths and realities of social media at work published by Triarchy Press, is a great success.

Its a great success, because, and I am not the first to say so, Jemima’s approach to her writing is very elegant. And also, Jemima is not in your face in an evangelical sort of way. That said there is more substance here, than a flourish of the digital quill. Jemima points us to the challenge of doing business, the nature of organisations, and a different way of marketing in a networked society.

So if you want an easy to read, enjoyable guide to understanding the world described as social media – then Jemima’s book is the one for you. Dave Cushman has also written a review of Monkeys with Typewriters. Going back and flicking through the copy Jemima gave to me its, as quite often with books I read that interest me, underlined, and comments written all over it. This book gently states, though it is the most powerful meme in our world today, that social media is not about technology it is about people. As Carl Jung wrote,

I needs we to truly be I

As Jamais Cascio told me, communications technology can be wielded as a powerful agent of change. The authenticity of the book is also that Jemima has spoken to a great many people in business and academia, and those interviews bring as closer to the interface of understanding the significance of doing business in a world where as Doc Searls wrote, markets are conversations, and where we argued in 2004 that Communities Dominate Brands, and that we saw the rise of the networked community generation, always on and always connected. We also saw that at the epicentre of what made business thrive whether that was online or off, was the ability to engage people within a social context – the complete 180 to an industrial approach to not just business, but also, how we work, how we want to lead out lives and how we educate our children. That insight is now unfolding before us, as it touches our daily lives. We are mid-wives to a new way of doing things.

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Posted in: Books, Engagement Marketing, Engagement Organisations, Engagement Research

Grow VC the Kiva of tech start ups

I am proud to introduce Grow VC which has some great heritage behind it. Not only the creators but also projects like Kiva, Artistshare, Galaxy zoo and Local Motors (More on networked economics). Here is the context,

80% of the growth in the UK is created by SME’s, yet these companies are the ones that often have the least access to high quality resources that will enable them to establish a true path to economic success. And yet the pressure is on.

As Liam Byrne declared last year, “in the next decade we need to be radical about power, realistic about money and relentless on innovation”. And of course it gets ever more challenging as economic power shifts to Asia, technology migrates us towards a global level playing field. And the implications according to Economist Hamish McCrae are these:

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

Against that backdrop, Government initiatives to foster regional development via the delivery of advisory services necessary to enable businesses to be successful have been patchy at best, and poor at the worst. Even high profile organisations have failed to live up to expectations. Moreover, one could argue that entrepreneurship, the very commercial lifeline for this country is being held back by an entire eco-system and mindset. some have waived manifesto’s, others have got on with the job in hand.

Relentless on innovation – its a great sound bite or byte, which leads us on nicely to GrowVC. And within that context, one wonders whether venture has become an acronym for safe, non-venture or destroy value, because we don’t really know what we are doing? In fact writing this reminds of a piece of work I did recently for a political party in looking at rapid learning systems for SME’s which I plan to run as a series of posts in the near future.

Mike Butcher writes @techCrunch

Grow VC is a new community funding model for technology startups. Here’s how it works: Grow VC will pool 75 per cent of membership fees into a community fund that gets invested back into ‘promising startups’ which are members of the platform. The fund is managed by Grow VC but all the investment decisions are left to members who determine how to invest their portion of the fund into other startup companies that they feel have the most potential. The most successful decision makers get financially rewarded when the community fund begins earning a return on investment. So, if you promote the best companies you make moola.

Joining Grow VC, and the basic features such as building a person profile, are free. Premium features come with subscriptions ranging from $20 to $140 per month, depending on how much money the startup company is seeking or how much the investor is looking to invest. For unlimited service investments, the monthly subscription fee is $90 per month. The fund is aimed at startups that need $10,000 to $1 million USD.

The service claims to include the tools needed for building a startup from the ground up, to getting funding at the seed level. Yes, that’s quite a claim, but it’ll takle a few startups to kick the tyres to see if this platform holds up. There are other playing in this area, such as the recent Sprouter.com but Grow VC is possibly the most ambitious I’ve seen to date.

Go and check it out – it might just be the panacea you are looking for?

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Posted in: Alan Moore Speaking, Convergence, Culture, Darwin, Economics, Engagement Marketing, Engagement Organisations, Engagement Sciences, Generation C, Green tech, Marketing, Networks, Participation, Strategy, Trends, Web/Tech

Online seminar with Gerd Leonhard and Alan Moore

Thriving commercially in social media and the networked society: An interactive seminar with Gerd Leonhard and Alan Moore

On March 1st Gerd and I will be running an interactive online seminar. (more information here) We felt our combined capability and insight would add value to such a session.

This interactive seminar run by Gerd Leonhard and Alan Moore is based upon their combined and extensive experience of working with many companies in helping them make the transition from a linear mass media model to a networked one. They will provide via case histories, practical guidance of how to thrive commercially in the networked society.

Attend This Event

Here is some context…

Our world of business, media, and communications is evolving from the straight-lines of an industrial era to the more complex and networked world that mimics nature. This interactive networked world isn’t about vertical silos, traditional notions of product and service creation, mass-production and mass media and marketing. It is about the massive flows of people, who are connecting, collaborating, organising and creating in a manner that has nothing to do with a linear approach too much at all.

The benefits of designing the smart organisation, coupled with the smart business model – purpose built for the needs of 21st Century culture and commerce gets us to ask these types of questions:

1. How does a company decrease the cost to build a car 100 fold whilst also halving the time in development?
2. How does a company perfectly match supply and demand?
3. How does a company use its employees to achieve business and commercial success greater than a $billion ad campaign?
4. How does a fashion retailer make €83m from mobile phone sales?
5. How does a company achieve a 29%+ response rate to its marketing with the subsequent uplift in sales?
6. How does a company spend $60,000 and get a $45m return?
7. How does a hybrid business model of [1] Freemium [2] Subscription [3] micropayment work to generate significant revenues?

Because we are still faced with the same challenges:

1. How do we find our customers
2. How do we make our customers sticky
3. How can we increase trade with our customers
4. Serve those customers whilst at the same time, reducing the cost to serve?
5. And finally how to just get stuff done

Chinwag are also kindly supporting us – so a big thanks to you guys

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Posted in: Alan Moore Speaking

Love poems on my mobile

Being Valentines Weekend the Financial Times published a poem by our Poet Laureate  Carol Ann Duffy called

Text

I tend the mobile now
like an injured bird

We text, text, text
our significant words.

I re-read your first,
your second, your third.

look for your small xx
feeling absurd.

The codes we send
arrive with a broken chord.

I try to picture your hands,
their image is blurred.

Nothing my thumbs press
will ever be heard.

Extract from “Love Poems” by Carol Ann Duffy (Picador)

Don’t forget our Social Media and Mobile bootcamp on Tuesday 16th Feb

And thanks Tim H for the heads up!!

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Posted in: 7th Mass Media, Culture, Engagement Marketing, Engagement Mobile, Generation C, Mobile, Society, Trends

Nokia Siemens Networks on the hunt for a Regional PR Manager

NSN are on the hunt for,

a regional PR manager, a passionate communicator able to independently project manage Nokia Siemens Networks PR messaging & platforms in the WSE region to maximize corporate awareness, support our strategy, products and solutions towards the business and trade press & key analysts.

You will be based in the UK – if this is of interest to you contact me and I can send you a fuller brief. If this then gets you really interested then I can put you in touch with the relevant people at NSN. BTW they are very nice people to work with. That is my experience anyway.

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Posted in: Uncategorized

Social media and mobile: my remote control for life bootcamp

Last year I sat with one of the anointed Glitterati of the US Digerati who was extolling the virtues of “social meeedijaa”, but only from the context of online. In the end I could not take it any more and I pointed out that surely mobile has an incy wincy part to play in all this social malarky – non? Especially when we see mobile penetration rates going through the roof some countries stand at 140%+

Au contraire, this particular geek looked at me and claimed that, whenever social  meeeedijaa was mentioned, naturally mobile as concept and reality was included within that context – you know based upon the last 2 hours of conversation I had listened to I did not agree. Yet our man was and is not the only one.

And this perplexes me – when the UK has 120%+ mobile penetration, yet at the same time there is a significant number of the British population that cannot even get online, you begin to wonder whether media and marketing companies have taken leave of their senses, by not taking mobile marketing communications more seriously?

Apparently only 7 media companies in London take a serious approach to mobile in their media planning. Yet it is the only media platform, that has over, once again, a 120%+ penetration.

And it more than that; mobile is our remote control for life and will increasingly will become so. And that is why the Social Media and Mobile: my remote control for life bootcamp is worth a day of your time. This is a one day interactive bootcamp that will help you understand why ignoring mobile, or thinking that mobile marketing is either sms push marketing (a numbers game mate), or an iPhone app is plain silly.

And why is that, well because we are still faced with the same challenges: how do we find our customers, how do we make our customers sticky, how can we increase trade with our customers and serve those customers whilst at the same time, reducing the cost to serve?

In a world which is not awash with cash, right now I reckon answering those questions  makes an enormous amount of sense.

I will run the day and we will use case histories to help all attendees reflect on your current marketing and business challenges and where you can begin to identify new opportunities and possibilities.

The case histories are wide and diverse, and are a means by which we can collectively work through new solutions for all attendees. I promise it will be a fun day. And whether you know a little or a lot – you are all welcome. And remember when mobile does a play a role in marketing and you get it right a 29% response rate is not unusual.

Don’t expect to be passive.

More information here

This is what you will get out of the day

1. Achieve a comprehensive understanding of how to drive business success – through using the mobile as a remote control that can sell car tyres, or become an extension of a retailer that delivered €83m in one year, and repeatedly delivers a 29%+ response rate.

2. Open up your collective minds towards the possibilities of mobile marketing and, in particular, help to develop solutions on what relevant mobile marketing looks like.

http://www.flickr.com/photos/21829813@N05/4209204594

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Posted in: 7th Mass Media, Advertising, Alan Moore Speaking, Convergence, Culture, Darwin, Data, Distribution, Economics, Engagement Marketing, Engagement Mobile, Gaming, Generation C, Link Economy, Marketing, Media, Mobile, Strategy, Trends

Facebook dominates UK mobile usage

Facebook accounts for nearly half of all the time people in the UK spend going online using their phones.

This is really quite extraordinary which I picked up from the BBC via a hat tip from Tim Harrap (thank you Tim).

People in the UK spent around 2.2bn minutes browsing the social network during December alone. The true number may be even higher as the data was only collected from three of the five UK networks. The data, which will eventually be collected from all five networks, showed that 16 million people in the UK accessed the internet from their mobile phones in December 2009. Together, they viewed a total of 6.7 billion pages and spent more than 4.8 billion minutes (60 million hours) online during the month. Facebook dominated the statistics, racking up the most unique visitors (5 million), the most number of pages viewed (2.6 million) and the most time spent on the site.

MOBILE MINUTES SPENT ONLINE

Facebook; 2.2bn minutes Google sites; 395m minutes Microsoft sites; 165m minutes Orange sites; 138m minutesAOL (and Bebo); 106m minutes Apple; 104m minutes Vodafone; 89m minutes BBC sites; 83m minutes Flirtomatic; 54m minutes Yahoo sites; 48m minutes Source: GSMA/Comscore

Social Media and Mobile Marketing bootcamp

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Posted in: 7th Mass Media, Advertising, Economics, Engagement Education, Engagement Marketing, Engagement Mobile, Generation C, Marketing, Mobile, Social Networks, Society, Strategy, Trends