Creating a Perception of Relevance is Critical for Companies Vying for Cloud Computing Success

Every company wants to be known as having the answers. Every business wants to be heard. Every brand wants to be relevant.

But the truth is, relevance is a commodity that is rented, not owned.

Creating a perception of relevance is critical to business success.

And it is as simple, and as difficult, as defining a clear, concise message and constantly reinventing dramatic ways to convey this message to your markets.

At 3Point, we have done just this. From helping disruptive technologies find relevance, to helping major companies re-establish relevance to positioning acquisitions as relevant accelerators to acquirers.

As noted previously in the 3Point blog and in blogs all over the web and in tech news everyday of the week all over the globe, the future of enterprise IT is closely tied to cloud computing.

And nearly every enterprise IT company is shouting. Shouting so their flavor of cloud computing will be heard over the cloud computing hype and earn them, what else --relevance.

But to the dismay of customers, the conversation is confused.

At this week's Cloud Connect event in Silicon Valley, Microsoft CEO Steve Ballmer said that within a year the work of nearly all Microsoft employees will have something to do with the company's cloud computing mission, built around Microsoft's flavor of the cloud -- the Azure platform.

And Google is working feverishly to insert itself into as many clouds as it can. "If you don't use the cloud you will fail," said Google CEO Eric Schmidt.

Oracle is in the middle of its own multi-continent cloud computing forum, telling organizations how they "can break through with cloud computing" using, of course, Oracle's cloud computing solutions.

Also, and as you might imagine, cloud computing expos and conferences are popping up everywhere so that customers can "better understand" how to put cloud computing to "work" for them.

But in many cases, so many choices are leaving customers more confused than ever.

There's Cloud Expo, Enterprise Cloud Summit, Cloud Computing Conference 2010, and IEEE Cloud 2010. To name just a few.

Here's a thought: perhaps from these conferences and global cloud computing tours an industry realist will emerge. A realist who is also a visionary leader and an advocate for the seamless world cloud computing can make possible.

But most importantly, a leader who's an advocate for the customer. Someone who is asking customers what they want and need for a safe transition to the cloud.

Leadership like that is hard to come by, but certainly not impossible.

Using NIST Definitions to Clarify the Cloud

The other day, I heard a new term used for cloud computing, "cloud washing."  Apparently this was coined by an analyst at Forrester Research to describe the practice of repackaging existing cloud concepts as something new or unique to a vendor.

This kind of marketing adds to the confusion surrounding the cloud.  In the zeal to be different, companies "repackage" information that is not different at all.  When this happens, companies often unwittingly put up a big caution flag for customers.  When an entire sector of companies employ the same marketing practice, customers simply stop in their tracks.

Fortunately, there is a standard set of definitions for various types of cloud computing. If you are confused by the hype, it might be helpful to rely on definitions put forth last year by the National Institute of Standards and Technlogy (NIST), part of the U.S. Department of Commerce. Fortunately, there seems to be a growing consensus around these definitions. Here is a summary of the NIST definitions for Cloud Computing:

Cloud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. This cloud model promotes availability and is composed of five essential characteristics, three service models, and four deployment models.

Service Models:
Cloud Software as a Service (SaaS). The capability provided to the consumer is to use the provider's applications running on a cloud infrastructure. The applications are accessible from various client devices through a thin client interface such as a web browser (e.g., web-based email). The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, storage, or even individual application capabilities, with the possible exception of limited user-specific application configuration settings.

Cloud Platform as a Service (PaaS). The capability provided to the consumer is to deploy onto the cloud infrastructure consumer-created or acquired applications created using programming languages and tools supported by the provider. The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, or storage, but has control over the deployed applications and possibly application hosting environment configurations.

Cloud Infrastructure as a Service (IaaS). The capability provided to the consumer is to provision processing, storage, networks, and other fundamental computing resources where the consumer is able to deploy and run arbitrary software, which can include operating systems and applications. The consumer does not manage or control the underlying cloud infrastructure but has control over operating systems, storage, deployed applications, and possibly limited control of select networking components (e.g., host firewalls).

Deployment Models:
Private cloud. The cloud infrastructure is operated solely for an organization. It may be managed by the organization or a third party and may exist on premise or off premise.

Community cloud. The cloud infrastructure is shared by several organizations and supports a specific community that has shared concerns (e.g., mission, security requirements, policy, and compliance considerations). It may be managed by the organizations or a third party and may exist on premise or off premise.

Public cloud. The cloud infrastructure is made available to the general public or a large industry group and is owned by an organization selling cloud services.

Hybrid cloud. The cloud infrastructure is a composition of two or more clouds (private, community, or public) that remain unique entities but are bound together by standardized or proprietary technology that enables data and application portability (e.g., cloud bursting for load-balancing between clouds).

We're interested in collecting examples of cloud washing,  If you have one, please post it here.

Shining Light on Dark Clouds

At 3Point we are of the opinion that cloud computing is rapidly evolving to the point that eventually nearly every corner of business will be impacted. We see nearly all segments of technology, from semiconductors to enterprise software to mobility, becoming significant elements of the cloud.

However, as we have mentioned in this space before, cloud computing hype is beginning to peak which could lead to confusion and delayed market acceptance. As an undercurrent to the hype, there is also a steady drumbeat of cloud naysayers, populating the blogosphere with the opinion that cloud computing is nothing but fog and will fall short of its ideal.

A quick Google search finds articles such as Money magazine’s “Cloud Computing is for the Birds” and AdAge’s “This Cloud (Computing) Has No Silver Lining,” which present arguments and opinion that cloud computing is not all as promised. Even respected McKinsey & Company released a study last year that painted the cloud in shades of dark gray saying that while the cloud provided some benefits for smaller companies, large companies could lose money through cloud adoption. And industry luminaries such as Larry Ellison continue to rant against the cloud as old news, nonsense and water vapor.

There is even a Facebook page devoted to debunking the cloud suggesting “Join if you think that cloud computing is a horrible idea” and posted commentary like “It's a funny word for "web services". It's been around forever, and it still kinda sucks. Calling it "cloud computing" doesn't make it any more practical.”

This skeptical opinion also appears to permeate some large corporations, like P&G, as reported by VentureBlog. “What is interesting, however, is that one thing they aren't trying are cloud services. It was made clear that P&G runs everything behind their own firewall. And they have no intention of moving any part of their infrastructure into the cloud. P&G's view of the enterprise is pretty old school.”

This presents a challenge for companies bringing cloud-related products and services to market. Not only must they present a compelling case for their individual success, they must present a solid argument for cloud computing.

We welcome your comments and opinion on this topic:

Is the skepticism of the cloud well-founded?
How might companies rise above this fog of negativity?
What companies are doing a good job with the cloud?
Is any company other than Saleforce.com doing a good job of marketing cloud computing?

For Enterprise IT Companies, the Value of the Cloud Goes Beyond Technology

If you’re a PR pro, securing coverage for your technology company, or client, in the top business publications has always been a crowning achievement. It’s the type of coverage that puts wind in the sails of a PR professional, not to mention what it does for the company itself. Of course, I’m talking about positive business press coverage. When it happens, the company CEO might walk the halls of his or her company with the coverage under one arm, showing off the story in good old fashioned black and white to anyone who glances in their general vicinity. It might be a thoughtful quote from a top company executive or a quote from a financial or market analyst that included mention of your company’s name. Perhaps the business article merely states the name of your company along with the competition. It’s all good.

When The Wall Street Journal, The New York Times, BusinessWeek and other top business publications call, a company’s communications department typically puts the brakes on whatever else it is working on to focus on the great opportunity at hand. Historically, the bigger the company, the greater and more frequent the interest from the business press. In the past, IBM or HP or Motorola had a better chance than smaller companies did of having their story heard by the big business books.

That was then. This is now.

A recent report by ITDatabase reveals that the behemoths of the tech world aren’t getting their proportionate share of business press coverage. And companies several rungs below the largest tech companies, but still generating several billions of dollars in revenue each year, are rarely if ever mentioned by the business press – at least looking back at the last six months.

Take for example BMC Software, a $2B company which received only a half dozen business press mentions in the last six months, according to the report. Or CA (aka Computer Associates) with only 10 business press mentions to show for its $4.2B in revenue, says the report.

The Wall Street Journal, The New York Times, Forbes, Fortune, BusinessWeek, The Economist, The Financial Times and USA Today were included in the survey. Company print and online mentions and blogs run by the participating publications all were taken into consideration.

“Enterprise IT is woefully underrepresented, despite being the cash-cow in the industry,” notes Dave Rosenberg, who blogs on disrupting the software market and is an adviser to ITDatabase.

While it’s not so surprising to learn through the report that Google and Apple are very well represented in the eight business publications, the delta in coverage between companies like Twitter and Facebook (the shiny new toys) vs. the icons of the tech world -- IBM, HP, Dell and Intel, Oracle and Cisco – is significant.

Rosenberg asks if it’s “reasonable to expect that tech categories (no matter how dry they might be) receive attention proportionate to the revenue they are driving? Or is biz press tech coverage about entertainment?” He said readers gravitate to stories about their favorite brands and are interested in the “latest and greatest” technology trends.

For enterprise IT, the latest and greatest trend today, and anytime in recent memory, is cloud computing. A simple Google News search on “cloud computing” this morning displayed 15,368 results and includes coverage in the big business books as well as second tier business publications, like The Chicago Tribune.

Just today, The Wall Street Journal ran a story about CA’s purchase of Nimsoft, another cloud computing company.

Enterprise IT is jumping big time on the cloud computing band wagon. And thanks to cloud computing, the business media is beginning to have a harder time staying away from enterprise IT companies.

Real Men Have CAD

“Real men have fabs.” That famous quote from the early 1990s, is usually attributed to Jerry Sanders, Chairman of Advanced Micro Devices, and was used to underscore the belief that owning a semiconductor manufacturing facility, or fab, was the only way a semiconductor company could be successful.

Many innovative chip companies saw things differently, however, and by the mid-1990s there were many successful “fabless” semiconductor companies. These pioneers realized that the $1-2B it cost for the construction of a new fab every couple of years was not only prohibitive from a cost perspective, but also not necessary at all.

These chip makers turned to TSMC, UMC, Seiko-Epson and even IBM for the manufacturing of the wafers and chips, while focusing their efforts on design innovation, testing and marketing.

By the mid-1990s, many of these fabless chip makers were among the most profitable companies in the semiconductor industry.

Fast forward to today.

The continuing economic downturn has forced all companies to take a hard look at cutting, or at least managing, costs. The semiconductor industry is no different from other markets, and every chip maker is looking for a way to turn fixed costs into variable costs.

In his post on Xuropa last year James Colgan said that one way semiconductor companies plan to turn fixed costs into variable costs is by moving parts of the EDA (electronic design automation) flow to a SaaS model, where components of the semiconductor design software reside in the cloud.

Clearly there is a trend in the semiconductor industry to take advantage of cloud computing as a way to reduce costs. The chart below shows the adoption curve for many of the EDA modules migrating to the cloud.

This will have ramifications for how EDA companies such as Cadence, Synopsys and Mentor Graphics market their products to customers. No longer will customers want to purchase costly software design tools, or even licenses to those tools, if they can use them via the cloud on a pay-per-use model. This trend is just now in its infancy, as is the way EDA companies talk about their relationship to cloud computing.

But as rapid as other software applications have moved the cloud, we're probably not too far away from hearing some stubborn semiconductor executive stand up and proclaim that "real men have CAD."

Can Too Much Hype Detour the Year of the Cloud?

One of the interesting things about working in the communications arena is observing time and again how rapidly fundamental ideas with great potential move from inspiring to confusing as they climb the hype cycle. Often, the result of accelerated hype is that customers tend to wait and do nothing.  While there are legitimate technical hurdles -- particularly in security -- that need to be crossed before enterprises migrate to the Cloud, I wonder how much the real benefits of Cloud Computing have been obfuscated by the seemingly endless discussion of a technology at the peak of the Gartner Hype Cycle.  

When you strip away communication excesses, we believe there are four major advantages Cloud Computing offers the enterprise customer:

• Greater economies of scale from maximum server utilization
• Greater control derived when users regulate how much additional service they need and can provision on demand 
• Greater operational efficiency from simplified management systems, and
• Favorable total cost of ownership.

For those enterprises that do not invest heavily in information capital as a core competency, we might also add greater IT expertise to the list of benefits.

The Cloud discussion is also confused by various approaches to Cloud Computing.  So, let's try to simplify that:

• An Internal Cloud resides in the enterprise's data center, where the enterprise owns the IT assets.  
• External Clouds require customers to pay fees, as the infrastructure is located at the premises of an external service provider.
• Organizations who want their own dedicated Cloud environment, use a Private Cloud model. 
• The more commonly understood Public Cloud is shared anonymously by many companies.

For large enterprises, four key issues restrict their willingness to fully embrace the external Cloud. We simply refer to this quartet of concerns as “SECREG” -- security, compliance, reliability and governance.

Security issues remain unresolved -- at least to the satisfaction of many large enterprises.  For many, compliance and governance -- particularly in Europe -- are also major issues.  These issues make Private Clouds the most likely first choice of many enterprises.

But some feel Private Clouds will migrate quickly toward a Hybrid Cloud model.  Hybrid Cloud models enable enterprises to protect core data in secure internal systems, while taking advantage of some of the benefits of an external Cloud. This might be driven by the need to offload non-core information during peak activity periods or the need to access some specialty cloud-based service, like threat-intelligence networks compiled by security companies.

Hybrid hype is coming soon and offers a reasonable value proposition that enables enterprises to justify a secure migration rather than a wholesale change. Hopefully, the added hype won’t add to customer confusion. The clarity of communication might help determine whether 2010 becomes, as some predict, the Year of the Cloud.

What Cloud Computing Means For Marketers

Cloud Computing has become one of the top trends in technology, with the business world buzzing about the potential and leading innovators like Microsoft to dedicate significant resources to be at the forefront of this trend.

The IT and operational benefits of the cloud are becoming well-known – increased efficiencies, lower barrier to entry for smaller companies, increased flexibility, etc. Even we at 3Point have embraced cloud computing operationally, leading to some nice efficiencies. However, what is the value the Cloud offers marketers? Often marketers turn a deaf ear to technology talk but this is a topic that has the potential to be hugely liberating for marketers, enabling great digital experiences for customers and enhanced revenues for companies.

What is cloud computing? Simply, all the computing infrastructure and intelligence (software, data and servers) is owned and managed remotely by a third party, and accessed via the internet using a web browser. Within cloud computing is software as a service (SaaS). Many of the innovative CRM, marketing automation and social software vendors operate via a SaaS model of delivery. But why is this important to a marketer focused on sales, brand value and customer experience, not how technology is delivered?

It matters because this approach can be hugely liberating for marketers, particularly in enterprises where the IT function is frustratingly slow for marketers trying to keep up with the breakneck speed of changing customer expectations online, and where putting together a business case in new areas of digital may be challenging. Among the primary benefits:

Cost. Cloud services are drastically less expensive than tradition hosting options, so marketers can do more and innovate more with their money. Cloud services enable some basic things such as faster time-to-market as solutions can be built in less time.

Faster scalability to better keep up with the variables of marketing campaigns and user traffic. In the past companies would have to prepare for an ad, email, keyword, or offline-online campaign and get resources ready on standby and have difficulties implementing mid-campaign course corrections. With cloud services campaigns can scale on demand with a lower cost and faster timeline.

Strategically, social services are enabled through cloud computing. New offerings like Facebook Connect, Twitter/delicious/reddit/digg/etc. apis, or even YouTube embed capabilities are all cloud services that enable you to drive traffic to your site without having to build your own social network. Facebook Connect is a cloud service that enables the portable social graph bringing users to your property. One user post back to a user’s Facebook wall results in three more users accessing the site. Customers tried to build social networks on sites like flip.com and other properties, now they can tie into the cloud service and get the same functionality in a fraction of time .

Most importantly, Cloud services allow us to think less in terms of technology architecture and more in terms of the marketing processes and workflow supporting the desired end-result. The Cloud smoothes a lot of technical complexity and assumes everything can be easily and integrated in real-time allowing marketers to focus on marketing and creativity. Blogger Adam Needles captures this idea well in this post and the situation has continued to evolve. We anticipate more and more company marketing departments will adopt the Cloud as a model and this will lead to new innovation in the design and implementation of campaigns.

If technology is becoming increasingly integrated into how you sell, manage relationships and build your brand's reputation, take a closer look at the Cloud. There are opportunities to increase simplicity, enhance control while at the same time lowering costs and increasing flexibility. And most important, providing marketers the opportunity to focus on marketing not IT.

Cloud Chips

It seems as if every technology company in the industry has announced a cloud computing strategy. IBM and HP. Oracle and Microsoft. CA and Saleforce.com. Amazon.com and Google. All major software and computing companies are moving to market with cloud computing solutions. It’s no wonder that a report from McKinsey & Company claimed that there are 22 different definitions of cloud computing in the marketplace.

So I guess I shouldn’t have been too surprised when I spoke to a friend of mine at Nvidia Inc. recently and he told me his company was “bullish” on cloud computing. For those of you unfamiliar with Nvidia, they are, in their own words, “the world leader in visual computing technologies and the inventor of the GPU, a high-performance processor that generates breathtaking, interactive graphics on workstations, personal computers, game consoles, and mobile devices.”

In short, Nvidia makes really powerful semiconductors for graphic applications. But why would a chip company be so bullish about cloud computing?

Let’s start with one of those 22 definitions of cloud computing. At it’s simplest, it is a way of computing, via the Internet, which broadly shares computer resources instead of using software or storage on a local PC.

Now some of those “computer resources” that live in the cloud are graphically intensive, 3D-modeling software applications that are used for everything from designing jet aircraft to modeling photo-realistic images of a patient’s heart for a doctor to view before surgery.

If you’re an aeronautical engineer working for Boeing, for instance, you might use a cloud computing application to run some 3D models for wind resistance over one of the plane’s wings. That type of graphically intensive application isn’t going to run on just any old computer server in the cloud. No, complex 3D modeling requires a server that is run by powerful GPUs, the type made by Nvidia.

Make no mistake, Nvidia and other semiconductor companies aren’t going to start building server farms and begin hosting cloud-computing applications. But companies such as IBM, HP, and others do. And those companies either buy or build specialized servers to run these graphically intensive applications.

In turn, the firms providing cloud-computing resources need to offer a variety of applications to meet the widely diverse needs of their customers. As a result, the demand for servers that can handle the enormous processing load placed on them by complex 3D graphic software is going to increase.

This interconnected food chain of cloud computing is creating opportunities for technology companies across the spectrum – from enterprise software to semiconductors. That’s why Nvidia, and any other forward-looking chip company, is bullish on the cloud computing opportunity.

The Battle for Cloud Computing Dollars in the Enterprise Has Only Just Begun

It seems like only yesterday when cloud computing was considered a dark magic – fringe technology that only a handful of the brightest technologists claimed to understand. Its business benefits not quite clear but its business risks all too clear. Earlier on, only the most aggressive large enterprises demonstrated an interest in cloud computing although caution flags dotted their path. Those brave enough to put a toe in the cloud computing waters did so with some courage but with much trepidation.

Fast forward to today and the cloud hype is deafening http://www.gartner.com/it/page.jsp?id=1124212.

Everyone is shouting, from Oracle – just one of several enterprise software companies currently expounding the virtues of cloud computing – to Microsoft, HP, IBM, VMware, among many others. While a number of these companies are promoting their unique definition of cloud computing (in part, to leverage their technology “differentiators”), the one thing they do have in common is the conviction that the cloud isn’t going away.

Recently, two enterprise software vendors in particular staked a leadership claim in cloud computing: Salesforce.com (www.salesforce.com) and CA, Inc., the company formerly known as Computer Associates (www.ca.com).

Officially, Salesforce.com is the first and only $1B cloud computing software vendor. Billing itself as the “enterprise cloud computing company” in its press releases, Salesforce.com announced last week fiscal year revenue of $1.3B. Company CEO Marc Benioff credits cloud computing with driving 21% revenue growth over the prior year http://bit.ly/cCjndT. Salesforce.com is reaping the benefits – as are its customers – of its early foot hold in the cloud computing mega trend.

A resurgent CA, Inc. is following in Salesforce.com’s footsteps in terms of making a very aggressive cloud computing push. CA’s recent acquisition of 3Tera, an established cloud computing company (www.3tera.com) – when combined with the recent flurry of CA’s cloud-related M&A activity -- sends a signal to the rest of the industry that the company’s transformation toward relevance and also toward cloud computing leadership is real. “It looks like CA paid well over 30 times 3Tera’s revenue. Such multiples are fairly atypical in tech (mergers and acquisitions) today, and very atypical for CA,” said a 451 group analyst http://bit.ly/bKu0Yf.

The battle for cloud computing dollars in the enterprise is officially underway, and if Saleforce.com’s recent earnings and CA’s acquisition spree are any indication of a trend, the price to play will keep going up.

Of Health Care Bills and Hybrid Clouds...

The debate of whether cloud computing will happen resembles the current debate over health care here in Washington -- everyone agrees it is needed, everyone has a different theory of who the customer is and what the customer needs, nobody likes the other guy's approach and yet nobody can agree how the issue will be resolved. So we should expect the hype and industry debate will continue to rage.

Wholesale conversion of massive data centers laden with legacy systems -- including highly efficient mainframes -- seems impractical and unlikely. Certainly, it is easy to overlook this somewhat pedestrian issue. The lure of getting up and running faster with new products and services is as compelling as the ability to scale on-demand to handle unexpected loads. A compelling argument could be made that these safeguards alone justify the change, if for no other reason than to prevent lost business due to decreased performance or downtime. But cloud management issues, particularly security and compliance, are not sufficiently resolved yet to enable CEOs, CIOs and boards of directors to endorse a wholesale move to the cloud.

What seems most logical is an evolutionary process through stages of the hybrid model. This likely starts with a shift of internal virtualized data centers to deploying external clouds for peak demands to meet the needs of internal users.

As an enterprise gets familiar and comfortable with an external cloud model, it will more readily evolve from peak demand to on-going hybrid, where IT departments rely on external cloud providers for continuing support of non-core functions.

This evolution holds endless possibilities, but we wonder how quickly it can happen. Looming large in the decision process is the "S" word. It is reasonable to expect customers will require the same level of management and security (policies, systems and processes) in a hybrid cloud that they have with internal data centers or private clouds. Today, customers perceive risk -- what happens if my data is co-mingled with others when I go off-premise? Vendors have not addressed this perception to the extent that customers are ready to move.

At this point, it isn’t clear whether the health care bill or full-scale cloud adoption will evolve first. They both hold enormous promise for change, but both seem to be progressing in fits and starts with non-negotiable issues still unresolved. In a world in which success seems to be increasingly measured by wholesale change rather than incremental development, we're not yet ready to bet the farm on which gets resolved first.

The Cloud Flattens The World

The world really is becoming flat, to borrow from The New York Times writer Thomas Friedman. In his popular book, Friedman argues that the world is rapidly becoming flatter through the use of technology among other things. This is becoming even more evident as the advance of Cloud Computing enables the smallest emerging markets and even individuals to catch up and compete globally through their ability to tap the resource of the developed world easily and cost effectively.

Every time there is a major inflexion point in information technology, there is usually a corresponding change in competitive edge. With the arrival of Cloud Computing as a new type of IT platform, we’re about the see a significant narrowing of the IT competitive edge gap that could especially benefit companies in developing countries. In the same way the rise of mobile phone technology in Asia has enabled that region to leapfrog other countries, Cloud Computing has the potential to facilitate further advances in emerging countries, evening the playing field, creating new business models and fostering new levels of innovation.

In his blog post “How Did Cloud Computing Suddenly Become Important,” Simon Munro effectively explores the impacts of the Cloud and the potential with expanded access of information, services, products and capital throughout the world. He states that “cloud computing is destined to provide the architectural basis for new products offered by first world organizations to emerging markets. Products will be delivered via the Internet, but as emerging markets do not have first world infrastructure, so delivery will have to be done using mobiles, simple interfaces, low bandwidth and low latency. Also, due to such a high dependency on a mobile device and the low margins for each sale, the (possibly free) ecosystem needs to be social, viral and low cost in delivery and marketing terms.”

The reverse is true as well. Companies and individuals in emerging markets are rapidly gaining access to people, information and capital that once was exclusive to the developed world. Even access to capital in even the smallest amounts (imagine systems that provide, perhaps via a mobile device, microfinance funded by individuals in the United States and other wealthier nations) provides ample motivation for ideas in the emerging world. This will sponsor a new generation of innovation allowing small companies and small countries to compete globally.

For marketers, this opens up a whole new world of possibilities but also a host of challenges. Out of marketers famous 4 P’s, Place becomes a constant as the Cloud become’s the world’s bazaar of all manner of products and services, while Pricing, Product strategy, and Promotion will require a combination of simplicity, creativity and recognition of customers from all corners of the globe.

P&G Visits The Valley

The convergence of technology, media and marketing has been happening for some time with many brands experimenting with all manner of digital mechanisms to reach audiences and illuminate their brands. It is not often that we are privy to the inner thoughts of the industry marketing leaders.

This week, however, word came that Procter & Gamble, the venerable leader in all things consumer marketing has established a presence in Silicon Valley to get closer to the rapid innovation and emerging technologies. VentureBlog and others attended a P&G briefing at which P&G had some interesting impressions of Twitter (“it is best for one to many communications that are short bursts of timely information” but “it is not particularly relevant to what they are doing on the brand building and advertising side”) and Facebook (“a must-have for digital advertising and brand building”).

P&G’s revelation that it is taking social media so seriously is all the more striking in the context that only a year ago a senior P&G executive was quoted at a conference deriding social media’s impact as a marketing tool, saying among other things "What in heaven's name made you think you could monetize the real estate in which somebody is breaking up with their girlfriend?"

Of course, many questions persist including whether all P&G brands are right for social media, an essential question for a successful social media strategy. P&G didn’t comment on its specific brand plans but a quick look at Facebook reveals P&G brand Pringles has nearly 2.5 million more fans than Old Spice.

While P&G has declined to quantify its investment in Facebook activities it is clear that even the world’s leading global brands have noticed and are taking the potential social media seriously. Hopefully P&G’s investment in its digital adventure will pay off with more innovation in the Valley and among marketers. The enhanced visibility of the benefits and of measurable results will create further acceptance of these emerging technologies within the marketing mix and a new appreciation for the merits of an integrated approach to marketing.

Social media is here to stay (at least until the next big thing comes our way), so brands of all sizes might as well join the conversation.

You Can't Manage What You Don't Measure

With so much of the social media focus on metrics, it’s startling that few marketing organizations and their PR agencies have the internal resources at hand to measure their social media success. The inability of companies engaged in interactive social media marketing to measure in-house the business impact of their campaigns is putting the cart before the horse.

You can’t manage what you don’t measure.

“..how can a company claim to judge social media on a particular success metric like brand awareness or customer engagement with no ability to actually measure that metric? Do companies think they should measure the impact of social media on brand and engagement metrics but never get around to doing so?” These questions and others like it were raised by Business.com in its recent report, “Business Social Media Benchmarking Study”. Sixty-five per cent of the survey participants, many of them senior executives, said they have the ability to see the impact of their social media programs using web site traffic as a metric. And 55% said they have a view into the success of their social media programs using “prospect lead volume” and “useful product feedback” as metrics. But at the bottom of the scale, less than 35 percent of respondents using “awareness” and “reputation” as brand metrics say they can measure the impact of their social media campaigns.

Certainly, there’s no shortage of social media measurement resources – from home-grown to “one size fits all” to elaborate customized solutions. Among the challenges associated with social media metrics is identifying the appropriate resources to take on the task. Large organizations have only recently begun adding the staffing power necessary to measure their social media efforts, while smaller organizations either don’t do it – or don’t do it well – or delegate the responsibility to their PR agency who in turn often delegate the task to an outside “specialist” firm.

Marshall Sponder, founder of Webmetricsguru.com, an industry blog about web analytics, social media and search marketing, says that clients are beginning to insist that their PR firms bring the social media measurement capabilities in house; that partner-based measurement models don’t work well enough.

At 3Point Communications, measurement is a cornerstone of the communications process. Metrics help clients to better understand their customers’ goals and enable more effective interactive communications results – offline and online. While we may use proven third-party tools when appropriate, such as biz360, 3Point’s measurement capabilities are in house. That’s where we think they belong. How else are we different? We provide all the backup data and charts of a standard analytics report but we also analyze the information to present concrete action-oriented recommendations. We can do this because of 3Point’s unique combination of digital experience, analytics skills and business focus.

How are your social media programs being measured? Are you happy with the results? We'd love to hear from you.

Rational Social Media

2009 was certainly the year social media took hold as a significant tool for marketers, and with the start of a new year, many “experts” are again trumpeting the merits of social media and forecasting the demise of traditional media and traditional public relations.

It seems everyone is talking about social media and discussing what services and tools to use, how to use them, why you should use them, etc. In fact, if you listened to all the advice out there, you would probably think that no matter who you are, whether an individual wanting to build a personal brand, or a large multinational corporation intent on communicating with customers, you should be using social media.

Fortunately, despite the fervor over social media, some sanity is beginning to show with rational thought – is social media really the most appropriate or best course of action? B2B Magazine for example, lists various reasons “When To Avoid Social Media.”

At 3Point, as excited as we are by the ongoing evolution of media and the availability of the many new channels of communications, we take the stance that social media is but one of the many tools available to engage, educate, empower and enrapture audiences. Marketers have always diligently planned advertising and public relations campaigns, picking the media in which to best present the latest and greatest to homemakers, Moms or avid golfers. This has not changed in the age of social media. The same due diligence is required to ensure a social media campaign meets the same criteria.

It is important not to lose sight of what is really important – are the communications activities achieving meaningful business objectives such as increasing sales and enhancing shareholder value. Just ad hoc Tweeting of opinion or establishing a generic corporate Facebook page will likely fail to achieve a meaningful response.

Here are some questions that need to be asked before any social media is applied:
· Who are we hoping to connect with?
· Is social media the best way to reach this audience?
· What kind of information is interesting to them?
· What other marketing and communications activities are planned and how does social
media integrate with them?
· What will be different in 3, 6, 12 months as a result of our social media efforts?
· What might go wrong? What expectations might people have of us?

With rational planning and measureable objectives in place, social media can be truly effective. Without, it can cause a company to waste time and resources, or worse still, actually cause harm to the company. Social media certainly can be beneficial; the real question is to what degree should it be deployed in the support of your other marketing efforts.

Using Social Media as a Cover

It is impressive to me that the realm of social media and social networks has moved from lighthearted and trendy to a mainstream research at leading educational institutions in such a short period of time. Then again, college campuses are the perfect seedbed for social media -- demographically, intellectually and socially. But the real impetus for research in a capitalist world is in trying to tame this amorphous beast and turn it into a cash generator. Enter business school research...

Research by Mikolaj Jan Piskorski, an associate professor in the Strategy unit at Harvard Business School begins to bring some definition to Social Media that is useful to understand, and I'm going to spend a couple of blogs on this just to keep it in digestible chunks.

Piskorski's research shows how we use social media, which tools we prefer and why. It also shines some new light on an "old" standby.

Piskorski says "Online social networks are most useful when they address real failures in the operation of offline network." In other words, social media lets us do things online that we can't do as easily offline: keeping up with friends, asking for help or references, making information about yourself available passively so that a recruiter might be looking to fill a position with someone of your experience -- even if you are not overtly looking for a job.

But the research is even more revealing. Do you know the killer app of social networks?

Tah dah....Pictures!

That's right. Piskorski's research shows that 70% of all actions are related to viewing pictures or viewing other people's profiles. Now, this part gets down to some very basic human activities, but it is useful for marketers to know: According to the research, "The biggest usage categories are men looking at women they don't know, followed by men looking at women they do know. Women look at other women they know. Overall, women receive two-thirds of all page views!"

This was a very big surprise to Piskorski. "A lot of guys in relationships are looking at women they don't know," he said. "It's an easy way to see if anyone might be a better match."

Passively allowing headhunters to find us. Quietly looking for a better relationship... These are examples of how people use social media and social networks as a "cover."

But what happens if a company decides to apply the same logic?

Why Marketing Must Change

Not long ago, companies looking to distribute their message to a large, diverse and fragmented market had only one real option: cover the market simultaneously using one-way mass communication. That model is crumbling before our eyes, and people in marketing disciplines who I hold in high regard seem lost in the Tsunami of change impacting marketing. Traditional advertising companies are caught in the shift from decades of standard print and network advertising to the world of digital marketing and online advertising. PR people are reeling from the shrinking news holes of traditional print media -- due in part to the previously mentioned shift to online advertising -- and from the rapid escalation of social media as an alternative to mainstream media outreach. Trying to react from a deep cultural deficit dating back to the 1950s is difficult for traditional firms. Many are scrambling to add digital arms to try to keep pace with the highly accelerated shift. But that is only a band-aid addressing the symptoms not the cause.

Perhaps the most succinct description that we've encountered of the real cause in this shift comes from the January-February 2010 issue of Harvard Business Review. In an article titled, Rethinking Marketing, the authors cite the fact that marketing for too long has been disconnected from customers.

"Because companies can now interact directly with customers, they must radically reorganize to put cultivating relationships ahead of building brand."

This makes intuitive sense to us, but carries massive challenges in implementation. Marketing departments must undergo wholesale restructuring, replacing the CMO with a Chief Customer Officer reporting to the CEO and "accountable for increasing the profitability of the firm’s customers, as measured by metrics such as customer lifetime value (CLV) and customer equity as well as by intermediate indicators, such as word of mouth (or mouse)."

Customer-facing functions must then be realigned under the new CCO. To accomplish this, long standing silos need to be destroyed and that is not an easy task. Responsibility for CRM systems and data must move from IT to the new customer-centered organization. Brand equity must be subservient to new customer equity metrics that measure long-term value of customers. R&D and product development must be undertaken with customer input rather than by simply adding features and benefits of interest to the developers. And product managers have to shift focus from maximizing their products’ or brands’ profits and help customer and segment managers maximize their profits. This is nothing short of massive cultural and structural change -- inevitable, according to HBR, but not for the faint of heart.

The authors point to an example at IBM as illustration of what the future must look like:

IBM's Insurance Process Acceleration Framework relies on a service-oriented architecture. In this structure, "customer and industry specialists in IBM’s insurance practice work with lead customers to build fast and flexible processes in areas like claims, new business processing, and underwriting. Instead of focusing on short-term product sales, IBM measures the practice’s performance according to long-term customer metrics."

This kind of change is inevitable and will continue to accelerate. Marketing, as we know it, must keep pace, but it is going to be like riding an angry bull suddenly released from the gate. The technology exists at many levels to enable this shift, customers not only want this world, they expect it, and the right set of metrics and data-collection tools exist to enable it. Customer-centric is no longer a buzz word, it is a mandate and the impact is devastating to marketers who don't adapt quickly. We all must acknowledge, as the authors point out, "The key distinction between a traditional and a customer-cultivating company is that one is organized to push products and brands whereas the other is designed to serve customers and customer segments. In the latter, communication is two-way and individualized, or at least tightly targeted at thinly sliced segments."

Energizing Brands

The number of brands in the world is increasing rapidly. With that, you would think there would be a renewed effort to think about brand strategy, brand positioning etc. as the key to differentiation and the driver of corporate strategy, since research shows as much 33% of the valuation of public companies is linked to their brand. Just look at the companies with high two of the highest valuations in technology -- Apple and Google -- and think about how good they are at creating, enhancing and expanding their brands. Heck, we are so impressed by these brands that we don't even focus much on their mistakes or failures. We buy into their vision and are left in awe of their inventiveness.

These are, what the authors of a great article entitled "The Trouble with Brands," define as "energized brands." The article was published in Booz Allen's magazine Strategy + Business.

The article is well worth reading as it presents both a strong point of view and rare analytical data regarding brands (the authors developed and use Y&R's Brand Asset Valuator tool). But to summarize it , energized brands are comprised of three major components:

1. Vision. Brands with vision embody a clear direction and point of view on the world. They convey what they’re on this planet to achieve.

2. Invention. Brands that score high in invention change how people feel and the way they behave.

3. Dynamism. Brands with dynamism create excitement in the marketplace through the way they present themselves to consumers. Dynamism is the most emotional and immediately visible of the three components. It reflects the brand’s ability to inspire consumer affinity.

Clearly consumer brands are more the sweet spot for this, but you only need to overlay these three aspects as a lens to see how Apple, Google and a handful of other brands elevate themselves above the thousands of others that compete for our attention, our engagement and our loyalty. It is not just about marketing or communications to manipulate a brand. It is about vision, planning, aligning products with unmet needs in the market and defining the right customer for the product. And it only works when there is passion for excellence balanced by a culture that understands failing at times is part of the process of innovation -- as IDEO, the terrific market leader in engineering and design, likes to say, "fail often to succeed sooner!"

Media Predicts 2010

Recently I attended a PRSA-hosted event called Media Predicts 2010 at the Computer History Museum in Silicon Valley.

Among the panelists attempting to predict the future of technology were Brad Stone from The New York Times, Connie Guglielmo of Bloomberg, USA Today's Byron Acohido, WIRED's Steven Levy, GigaOM blogger Om Malik, the Wall Street Journal's Ben Worthen and Matt Marshall from VentureBeat and the DEMO Conferences.

Some of the predictions were tame and, well, predictable, such as the companies to watch in 2010: Apple, Google, Amazon.com, FaceBook and Twitter. No one went out on a limb there. Many of the other predictions, however, were insightful and thought-provoking. Here are a few:

• The Motorola Droid running Google's Android operating system over Verizon's network will crush Apple's iPhone; there is a rumor that Apple will release a new version of the iPhone on the Verizon network in 2011. From firsthand experience, I doubt this will happen.
• M&A activity will increase leading to a smaller number of bigger companies. As result of the M&A activity, companies will become stronger and more profitable while at the same time laying off more employees increasing the level of unemployment not only in Silicon Valley but across the world.
• Venture capital money will be very scarce with few, if any, companies receiving significant funding.
• The "buffet" of free news on the Internet will end as newspapers, magazines and even some blogs will begin charging a fee for their online content. There may, however, be an uber-site that allows users to pay a single fee to access content from many news organizations, if the FTC decides to allow such a practice.
• Apple's iTablet, or whatever it ends up being called, will finally become a reality, thus blurring the lines between smartphones, netbooks and laptop PCs.
• Twitter will go out of business.
• Twitter will figure out a way to make money.
• Twitter will be acquired by Google.

The debate among the panelists as they gave their predictions for technology in 2010 was lively and for the most part informative.

What predictions for technology do you see for 2010?

Barbagallo Joins 3Point In Boston

3Point Communications Taps ex-Porter Novelli Partner Jim Barbagallo
Agency and corporate communications veteran to establish 3Point's presence among Blue Chip and fast growing emerging companies with focus on the U.S. northeast

Boston, MA, November 17, 2009 -- 3Point Communications today announced that Jim Barbagallo has joined the agency as a managing director. In this newly-created position, Barbagallo will drive growth for 3Point in the northeast while also helping the communications firm grow nationally. Barbagallo has more than 25 years of experience in public relations and marketing communications with specific experience in developing and executing strategic, integrated communications programs for emerging and established technology companies.

"Information technology companies are already starting to play a key role in pulling the U.S. economy out of this recession," said Barbagallo. "And in the northeastern region of the U.S., and especially Massachusetts, IT continues to play a role as fuel for the economy. Other technology sectors -- including "clean tech", nanotechnology, electronics and biotechnology -- also are key parts of the economy in the northeast. Among these companies is a strong and growing demand for communications professionals who can help elevate brands and 'instigate' conversations with stakeholders. That is at the core of what 3Point does."

Previously, Barbagallo was with Porter Novelli, where he was managing director of the Boston office as well as a company partner and member of the global firm's technology council. During his 10 years with Porter Novelli, Barbagallo developed and cultivated client relationships with world-class companies such as HP, Analog Devices, BMC Software and 3Com, among others. In addition, Barbagallo worked with a number of emerging technology companies, including IBRIX, Sociocast and NeuStar. Barbagallo had also been with Copithorne & Bellows PR prior to its merger with Porter Novelli. In addition, he had also been director of marketing public relations at Digital Equipment Corporation, a global marketing communications manager for HP and a reporter with the "Eagle-Tribune" in North Andover, MA.

About 3Point Communications helps its clients accelerate growth through effective communications. By developing compelling stories that can be retold in a number of different ways, we create communications that includes content that inspires action and engenders communities to interact. Leveraging the most appropriate traditional and digital media channels to elevate brands’ mindshare and instigate conversations, we are able to reach a variety of audiences, delivering a message that resonates locally, regionally and globally. With a presence in Boston, Silicon Valley and Washington D.C., 3Point develops creative, results orientated campaigns for market-leading blue chip and fast growing start-up companies.

Droid Doesn't

In its massive advertising campaign, Verizon (with Motorola and Google) states, "In a world that doesn't, Droid does." The ads are for the new Motorola Droid smartphone running Google's Android 2.0 operating system over the Verizon Wireless network.

I ordered my new Droid on Nov. 6, the first day they were available to the public, and had it in my hands by Tuesday, Nov. 10.

After activating the phone I began playing with the many cool features loaded into the Droid, including fast Internet browsing, more than 10,000 apps, etc. But when my first call came in I discovered that the Droid's most basic function, the phone, performs extremely poorly.

Although on the Verizon network, my Droid rarely holds a steady, or very strong, signal. I often watch in amazement as the bars jump from 4 bars (full signal) to 1 bar (weak signal) to no bars at all; something my old LG phone never did. And by the way, I live in the heart of Silicon Valley which typically has excellent Verizon Wireless coverage.

The fluctuating signal translates into poor phone reception. The person to whom I'm talking to on my Droid often cuts out, sounds like they're far away, or the call is dropped altogether. And on the other end of the call, the people I'm talking to experience an echo problem. That is, whoever I talk to can hear their own voice echoing back to them.

I did a quick check on the Motorola Owners' Forum and found that both the poor reception and echo problem were being experienced by thousands of Droid users in all parts of the country.

Apparently Motorola was so focused on packing tons of cool features into the Droid that they forgot to build a decent working phone.

After battling for more than a day with my crappy reception and echo problems -- and more than 4 hours on the phone with Verizon's technical support staff -- I was directed to go to my local Verizon Wireless store to get a new Droid.

The people at the Verizon store were helpful enough and I walked out of the store with a new Droid.

I got home and made my first call to discover that the poor reception and echo problem were present in my new Droid as well. Not only that, I discovered a new problem to boot. Because the Droid is a touch phone, the screen goes dark when you put it to your ear to avoid the accidental pushing of any buttons. There is a sensor inside the phone that is supposed to sense when the phone is removed from your ear in order to relight the phone's touch screen. Well, my sensor wasn't working properly and the screen remained dark making it impossible to use the key pad or to end a call.

After many hours on the phone (on a land line) with Verizon Wireless tech support, I was told that the poor reception and echo problems will hopefully be fixed with a Dec. 11 upgrade to the firmware, but that no one had yet reported the sensor problem.

Obviously neither Verizon nor Motorola were tracking the Motorola Owners' Forum because all of my problems were being experienced by many other Droid owners too, including the dark screen.

The Verizon tech support guy was very helpful and promised he'd send me a new phone (my third) if the poor reception problem, echo and dark screen issues didn't clear up.

I've owned my Droid(s) for less than a week now and have spent more hours on the phone with tech support than I have talking on my Droid. I realize that with any new technology there are going to be bugs that have to be worked out. But when building a new smartphone, you think that Motorola would have focused on the phone part of the Droid first, making sure that it worked to perfection.

As for Verizon, the poor phone reception is hurting its well-earned reputation for having great nationwide network coverage.

I guess in a world that doesn't, neither does the Droid.

Resurgent California

Is California the “Golden State” no more? I think not.

Having been a magnet for masses (including myself, a transplant from the Midwest) seeking the land of opportunity and a better life, California has always personified what the American Dream has been about – innovation, tolerance, cultural diversity, opportunity. Be a pioneer, go to California with an idea and strike it rich.

In recent years California has driven itself to the edge, staring into an abyss of high taxes, high unemployment and a bureaucratic jumble unable to govern effectively or efficiently. Driven seemingly at the point where no return is possible. Not a day goes by without a headline trumpeting the demise of California.

But, as it has been many times before, California is resilient and a new age beckons. As Michael Grunwald of Time Magazine writes “It's expensive and crowded — because people still want to be there! — and it's recovering from an economic earthquake. But it continues to have a powerful claim on the future.”

With an economy that would surpass that of all but 7 countries in the world, California is always at the forefront of many of tomorrow’s industries becoming the mecca for high tech, biotech and now clean tech with many new companies leading the charge. California is not just into renewable energy, California is about renewable industries and renewable companies. This past year California attracted more venture capital than the rest of the U.S. combined, a testament to the innovation culture that is California.

"The beauty of California is the idea that you can reinvent yourself and do something totally creative," says Kogi'Taco’s founder Roy Choi, a former chef at the Beverly Hilton, in Time.

Californians are always looking ahead of the curve, anticipating and creating our future. “Does it play in Peoria” is less important here than the journey of innovation, the tug-of-war between success and failure that brings about positive change. So, while California may get the negative press (which it sometimes deserves) it at the same time is leading the country and the world in new directions.

Enter Droid

The new Motorola Droid smartphone, running Google's Android 2.0 operating system, on the Verizon network hit the market today and by 10 a.m. Pacific time I had placed my order online. According to Verizon, I should have my new phone by November 9.

In his review for the LA Times, Mark Milian calls the new Droid "the best phone on Verizon." Milian praises the technological advances in the Droid, including a 5-megapixel camera with flash, a pleasantly loud speaker, and a touch screen that is not only "gorgeous" but larger than Apple's iPhone with more pixels per inch.

The Droid also has a slide out key pad that remarkably doesn't add any significant thickness to the phone compared to the iPhone.

And the Android Marketplace offers more than 10,000 apps for the Droid.

There are, however, some drawbacks according to Milian.

If you plan to use the Droid to listen to music, watch videos or play games, the iPhone is probably a better option than the Droid for now.

But don't forget, the iPhone uses the AT&T network exclusively, which is generally considered inferior to the coverage offered by Verizon. So if voice, text and Internet access is a priority, then the Droid will give the iPhone a run for the money.

And speaking of money, the Droid comes in at $149 if you can get the instant rebate and have good standing on your Verizon account; much less than a comparable iPhone. There is, however, a rumor that Apple will soon release a $99 3GS iPhone in response to Droid.

Once I get my new Droid and have some time to put it through its paces, I will post a review of my own.

New FTC Rules Aim to Keep Bloggers Honest

New FTC rules on social media content go into effect December 1. For the most part, the new rules are aimed at protecting the consumer from reading a blog, for example, about a product that presents itself as an editorial, when the "blogger" has been paid to promote the product and/or has been given the product for free.

That's a good thing, right? Yes, but it does create a few things every marketer must consider --whether they run a blog and/or promote their products on blogs or other social media sites (such as Twitter).

The main crux behind the new rule is this...when endorsing a product or service (in a blog, tweet, etc.), you must:

1. Disclose when you are being compensated--whether you are being paid for the endorsement and/or have been give free sample of the product (traditionally known as "not-for-resale" copies).

2. Be truthful in your statements, and make sure they can be substantiated.

3. Speak from actual experience -- meaning you can't just regurgitate the sponsor's marketing speak if it isn't an actual experience, opinion, or belief of your own.

And the fine for not doing so? 11,000 big ones, as in dollars.

Really, most legitimate marketers already follow #2 and #3, but they should now be much more diligent in making sure nothing slips through. The biggest change is the disclosure requirement -- so make sure your social media efforts now have these new rules on the operations checklist (whether you are the blogger or the product company promoting through 3rd party blogs). It's the law!

Do Companies Really Want to Hear from Customers?

In a recent post to PR 2.0, guest writer Becky Carroll concludes with this thought:

"One note of caution. Once you begin engaging with your customers in a collaborative way, the relationship changes. You are no longer customer vs. brand; you are working together for something new, something better for the future. As mentioned, this type of interaction creates strong customer advocacy and loyalty, and customers won’t react kindly to a termination of this unwritten contract. Be in it for the long haul."

In addition to being "in it for the haul," i.e., an ongoing, possibly never-ending conversation with customers, companies have something even more important to consider before jumping head first into social-media driven discussions with customers -- are they really willing to listen?

Remember, conversations with customers will not be about the weather conditions at corporate headquarters or how the CEO's daughter did at her soccer game. No, conversations with customers are about real business issues, tough issues. And you know what? Customers want companies to not only hear their input but to act on it as well.

Is your company prepared to make changes to your distribution channels because of customer input? Is your company ready to scrap the new feature that product development has been working on because customers now want another feature instead? Are you ready to lower the price of your product or change the way you package it?

How a company decides what customer input to act on and that input that can be ignored is critical to the customer/brand relationship Carroll speaks of. So a couple of things to consider.

Who in your company is having these conversations with customers? Is it your sales department through customer service channels? Is it marketing? Or is it your outside PR agency? Most likely, many people within your company will be having conversations with customers via social media.

So the next question is this: Are you sure they're all saying the same thing? Does your mid-level marketing person really understand your company's brand essence? Are you confident that the intern at your PR agency is sticking to your company's marketing messages?

That's why before a company decides to embrace social media as a means to communicate directly with customers, it should be able to answer a core set of questions:

Community

• What segments of your customer base are you trying to reach?
• How do they live, work and play?
• What do they expect from you?

Content

• What is the lexicon of different customers?
• What information are customers looking for?
• What formats must you develop to reach them?

Communications

• Where do your target customers look for information?
• What do they respond to?
• What does it take to get them to participate?

And once you answer all of these questions, there's one final question you must ask yourself: Are you willing to do something in response to your customer's input?

AMD Once More the Aggressor

Roughly four years ago, AMD took out full page newspaper ads challenging Intel to a dual-core server duel. Intel declined the offer. CNET, however, decided to hold a shoot-out between the two leading microprocessors to see which chip performed better.

CNET put the chips through a series of seven tests, and the results showed the AMD Athlon a clear winner over the Intel Pentium Dual Core processor.

That’s the good news for AMD. Unfortunately, as of 2008, AMD still held only 13 percent of the microprocessor market compared to Intel’s 80 percent market share. AMD was able, however, to chip (pun intended) away at Intel’s lead.

Now AMD has its sights set on another market leader, this time in the market for graphics chips for PCs – nVidia. With its introduction of the ATI Radeon HD 5800 series of graphics chips, AMD claims it now has the fastest graphics processor ever created, and they’re shipping in PCs today.

It will be interesting to see how nVidia responds. It will also be interesting to see if AMD’s newest entry begins to win it additional share in the graphics chip market. Currently both nVidia (with 29 percent market share) and AMD (18 percent market share) both lag considerably behind market segment leader Intel (which boasts 51 percent market share).

But AMD aims to make it a three-horse race.

Too Old to Change?

I am a product of the Baby Boom -- a member of the generation born in the euphoric decades immediately after World War II. I take pride in my generational badge. We are acknowledged as the generation of change -- not just technological change, but massive, scaleable social change that has impacted race, war and peace, politics, philosophy, education, investment, art, music, fashion, transportation and so many other aspects of our nation's collective DNA. However, I now wonder if our last great social contribution to the world may have been the democratization of information via personal computing and the Internet. Not a bad track record, but having brought that double-edged sword to global prominence and daily addiction, we now seem to be sitting on our hands ready to enjoy the fruits of our past labors but hesitant to embrace what might be the greatest social change agent in the history of man taking place right before our eyes. Rather than jumping in and mixing up, we are starting to sound like our parents did when they heard our music and intuitively understood that crossing the gap from what Frank Sinatra sang about to what Neil Young rebelled against was probably a bridge that was culturally too far to cross.

I'm speaking of social media. Daily, I encounter conversations with affluent, avidly online Boomers astute in technology who rail dismissively against social media. Their description of the value of Twitter, Facebook and other means of enabling global conversation is a consistent scornful drumbeat that often sounds like my parents did when I tried to let my hair grow long. Now, I'll be the first to admit that I'd rather be forced to listen to the Carpenters Greatest Hits than read minute-by-minute reports from someone at a conference -- regardless of the subject matter. But to view social media in that narrow window of understanding is akin to interpreting the Internet as only a vehicle for pornography. And yet, that seems to be how my "demographic" looks at it. A recent study by Burst Media found that only 8 percent of Baby Boomers feel social networks are focused on them. Put another way, 92% of the most affluent demographic -- one that makes up more than 25 percent of all U.S. online traffic -- feels disconnected from social media. This includes people who engage in social networking. The chart below shows the key findings of the Burst Media study.

Source: Burst Media

One of the questions this raises is whether we, as a generation, have become disconnected, irrelevant or just curmudgeonly. Clearly something is missing. Either the network providers don't value the generation enough to figure out how to appeal to them (which I consider unlikely given that most social media is based around highly customizable platforms) or the generation doesn't value social media. More likely, we simply don't understand how to engage. As one boomer explained to me, "it feels like jumping on a moving train and it just isn't important enough to me." Thus, a generation known for progressive change has become too tired or too comfortable to participate in a disruptive technology that has played a major role in electing a President, stimulated massive protests to combat tyranny in Iran and serves as a tool to continue building awareness of key ideas and issues around an ever shrinking globe. Boomers can not be disenfranchised from this phenomenon. We need to stop thinking Bee Gees and start thinking John Lennon again.

Social Media Policies

Establishing policies to govern social media is a significant challenge in many organizations on many levels. Nowhere is this more complex than at large, diverse organizations. We have seen this kind of issue often over the years. Yet it is even more complex today. Within minutes of any discussion of social media, complicated debates arise over areas such as security, use of customer information and references, privacy, regulatory issues and the sheer determination of who in the organization manages social conversations for which part of the organization. Those debates are usually accompanied by a fundamental ROI question: how does the company create a meaningful set of metrics to make stakeholders accountable for performance of social media and social application investments.

Sometimes the best starting point is looking at what other organizations have developed. Chris Boudreaux is a consultant who is writing a book on this topic. He has developed a database of examples from more than 80 organizations, ranging from local government to media and large corporations in several different companies. It is one of the more comprehensive lists we've seen. You can order a preview of the book, access his database with links to the actual policies or contribute your own or your client policies at:

http://socialmediagovernance.com/policies.

New HP Printer Leaves the PC Behind, Almost

This week HP's new Photosmart Premium TouchSmart Web All-in-One printer (whew, that's a mouth full) becomes available, representing the first printer that can print directly from the web without being tethered to a PC.

But before you send your faithful PC to the recycling center you might want to take a closer look at the new printer. There is no actual browser capability available on the TouchSmart, rather users tap on widgets from about a dozen of HP's partners.

Users will be able to print out movie tickets from Fandango, maps and calendars from Google, coupons from Coupons.com and even select articles from USA Today. Not all capabilities are available immediately on the TouchSmart, however, so users will have to wait until later this month to print tickets from Fandango and even longer to print driving directions from Google Maps.

Still, this is an important step forward in the world of printing. It wasn't that long ago when printers weren't capable of true photo-quality images and all-in-one devices were clunky and slow. Today, we take those capabilities for granted in our printers.

Within a short time, HP and other digital imaging manufacturers will provide printers that enable us to connect, view and print directly from the web. Video on your printer screen is not that far off. These products will not only change the way we print, but will change the way we interact with our computers.

But for now, hang on to your PC.

Asia Social Media Evolution

The social media phenomenon is very much global with populations worldwide using technology to communicate and build communities. Marketers are faced with evolving variances from market to market as audiences gravitate to media channels most effective at providing the content they need and want. The challenge to marketers is determining the best communications channel to reach any particular audience to ensure the message is accessible and in the best context. Nowhere is this more so than Asia, with its vast variety of peoples, languages and cultures and a dynamic social media scene.To provide those interested in Asia a guide to the current state of digital marketing, the Asia Digital Marketing Association offers a free 2009 Yearbook , providing an indispensable resource in understanding the regions emerging social media scene.For marketers trying to grasp the regional differences in the use of digital marketing techniques, the 80-page Yearbook is full of facts and figures such as these summarized by ADMA Chairman, David Ketchum, whose day job is as CEO of leading regional consultancy UpstreamAsia.“Facebook, Twitter, Friendster, Bebo, MySpace and LinkedIn have built large-scale user bases in Asia Pacific but these global players don't dominate in every market. New patterns of usage and local behavior are emerging across the region, with clear distinctions from country to country where consumers spend time online, and how they behave.”China is number one in search, with 12.8 million searches performed in a month by nearly 150,000 searchers - that's 85 searches per searcher. Japan is the second largest search market, with 5.9 million searchers. However, Korea's searchers are most prolific, with 109 searches per searcher, Singapore not far behind with 106. Mobile continues to gain, both as a text messaging and voice call channel, but also for Internet access. Asia Pacific (ex Japan) has 97.6 million mobile online gamers, and 50% of them are in in China. There is 60% mobile phone penetration in the Philippines. Filipinos send the highest number of SMS messages per subscriber in the world. Mobile site page views grew 1120% YOY. 2008 Asia Pacificwide mobile data revenues topped US$65 billion, and an estimated 473 million handsets were sold.”Clearly 2009 presents an opportunity for marketers to explore and create new methods of interacting with their customers globally, along with the challenge of navigating the local dynamics of each individual market. By doing their homework and utilizing these evolving methods, marketers have the opportunity to deliver well thought out messages in ways that resonate most with their customers. The ADMA 2009 Yearbook is a great place to start.

What Really Matters in Business

Sep/21/09 08:50 While the promise of social media continues to create a frenzy, a growing number of industry thought leaders are sorting out the proper place in the marketing food chain for this exciting new form of communications. There is no doubt social media represents new and varied opportunities for brands to engage their customers. Those among us with a bit of gray in our hair recall that it isn’t the media itself that makes the story. Our friend Ted Simon posits that this discussion is too tactical in nature as media, social or traditional, are merely channels, and that the real discussion and value is in defining the message or story and ensuring it drives business objectives. Communications is best when it tells a story and that story reflects a brand’s true attributes and supports its business objectives as opposed to frivolous, ad hoc messages haphazardly distributed with the hope that they reach a friendly ear. The executive suite still assesses business not by the number of followers the company has, but by valuation, sales, revenue and operating income. It is crucial that communications support these metrics. Measuring by followers, media clips, impressions and press releases falls far short since they are all calculations of activity not bottom line impact. It is important to take an agnostic approach to media, evaluating the merits of all media channels and tools based on their ability to deliver the right message to the right audiences in the right context to achieve business goals. Social and traditional media intersect and interact, each contributing to the other. Marketers are wise to recognize this interdependence and embrace both, evaluating the efficacy of specific channels of communication as it relates to the business needs of the brand.