Turn the Tables

adhesivo fight the powerThis week the crazy internets have been abuzz with the story of AOL executive Ryan Block, who attempted to do something rather mundane, cancel his cable, and was subjected to an excruciatingly long ordeal with the customer service representative at Comcast. This is well covered, I don’t need to relive it… and more to the point, we’ve all been there.

What makes this story, and others like it, catch fire is that there is a recording to go with the narrative. The call experience comes alive with the voice recording.

This is a relatively recent phenomena and one that is a result of powerful digital technology shifts that have driven the communication revolution that has swept the globe. This is the part of the story that makes me absolutely giddy because it’s technology as a great democratizer of power against monopolistic corporations that don’t care about us until it blows up in their face.

It’s no surprise that the more power companies have in the market the worse their customer support becomes and they know it. While giving lip service to customer satisfaction, the fact remains that these companies know that customer service is ultimately a cost center, not a profit center. The people hired into these roles may be well meaning, but they know they are a cog in a machine and, ultimately, replaceable. The incentives and measurement systems prioritize retention above all else, not problem resolution, and they practically beg you to provide a good score in the post call interview.

As a result of the perennially poor customer service environment I have opted to turn the tables. I never make a customer service call that isn’t recorded, using an app called MP3 Call Recorder. It is also possible to record the call through Google Voice but this only works for inbound calls so use Gethuman.com to have the company call you back to your gVoice number.

In California, where I live, there is an explicit legal requirement that 2 party consent is granted before recording voice calls, but I figure that call centers routinely notify me that my calls are being recorded for “quality and training” so I figure that consent has been granted. Besides, this is a criminal statute and I think that odds of a prosecutor bringing a case against me for recording my customer service experience at, for example, Visa to be 0%… 0.00% probable. Bring it, I’d love to be that person.

Social technologies continue reshaping how brands interact with customers, and it’s good for customers when everything is out in the open and public. What Block did, and I wish I had his demeanor and patience in such a situation, is something that brands should pay attention to because their well cultivated brand images suffer real setbacks when their bad behavior, driven by perverse employee incentives, become public. Comcast has spent years telling the market that they are different now and care about customers. The countless dollars on advertising, speeches, and public proclamations evaporated as a result of a 20 minutes customer service call. Imagine that multiplied by thousands.

Bonus: This calls for a Monty Python clip

Be Careful What You Get Good At

ivak_Bear_TrapI just finished watching True Detective, which by any measure is an impressive piece of work. There is a scene in one of the final episodes really struck a chord with me.

Cohle: Life’s barely long enough to get good at one thing.
Hart: If that long.
Cohle: Yeah, so be careful what you get good at.

Do you ever feel like you are trapped in the thing you do for a living?

There’s a lot of things we take for granted in the tech industry but that privilege does come at a price, which is that career mobility suffers. I honestly don’t know where I could do what I am good at if not for a technology vendor and get the same level of intellectual and financial reward.

People say “but you can take your skills and apply them to a wide range of industries” and while that is probably true the fact is that there are a lot of people in those other industries that also have skills and the benefit of experience. Combine that with the fact that technology companies offer significant reward in the form of financial incentives, working with brilliant people on, hopefully, really interesting projects and it’s hard to imagine going to a different industry, or simply starting over in a new career.

It’s a little late in life to go become a chef, auto mechanic, landscape architect, or screenwriter for a crime drama television show. Life is barely long enough to get good at one thing…

Fan Power

This was a surprisingly interesting op-ed, not interesting because it is penned by a glam celebrity but because op-eds are typically not insightful and rooted in facts, as this one is.

Yes, the entertainment industry is changing, as it has always done, but in this case the influence of social media – the broadcast medium of our century – can’t be underestimated. Swift writes about the changing relationship with fans and this mimics what is happening across the spectrum, companies are being forced into a new form of intimacy with customers. Musicians my recoil at the notion that fans are customers, but that’s exactly what they are, and in 2014 what fans expect from entertainers is a different experience than the music alone… they want a relationship.

One point that Swift misses on is the notion that music is art and because art is rare it is inherently valuable. This could not be further from the truth when it comes to music, television, and movies. These forms of entertainment are digital in nature and therefore infinitely reproducible in pitch perfect form. Rare art is a painting or sculpture or some other form of analog inspiration and beautification, it can only be reproduced in original form by the artist and that is indeed rare.

Music is art, and art is important and rare. Important, rare things are valuable. Valuable things should be paid for. It’s my opinion that music should not be free, and my prediction is that individual artists and their labels will someday decide what an album’s price point is. I hope they don’t underestimate themselves or undervalue their art.

For music, books, movies, etc., the market sets a price and discards the notion of rarity altogether.

Been Gone a Long Time…

Wow, I think this is the longest stretch of non-writing that I have done in my history of blogging. Nothing in particular drove my absence, just been busy with work and family.

A lot of my time the last few months has been spent on a website redesign project, which I took over last December. This was a pretty complex undertaking, combining new messaging, visuals, information map, and a new content management system (Adobe CQ). It was a hell of a project and to borrow a line from the movie The Money Pit:

“There were a couple of times when I didn’t think we’d ever be able to put this baby back up.”

We did, it launched last week and you can check it out at www.pingidentity.com.

I’ve also been continuing to build out a top notch marketing org while also working with our sales organization on improving the manner by which we are supporting them move business through the funnel. This is probably the most challenging part of what I am doing right now, if for no other reason than our market is evolving at a fast rate and what is required of direct sales teams is changing as a result.

Summer is in full swing but this year there is no slow down to focus on the more pleasurable pursuits of the season, but it’s still a good summer nonetheless.

Retooling Marketing in a B2B Company

Ping coporate logo 2014Ping Identity has gone through a top to bottom transformation in marketing over the last year. A successful organization that fed impressive growth, reaching growth and revenue records year over year, the marketing organization relied on a proven B2B outbound marketing model that precisely measured lead capture rates.

My interest for the last decade has been in inbound marketing models that rely on content to drive business opportunity. More significantly, I follow the advice of many friends who I would call contemporaries in B2B marketing, like Steve Mann at Lexis-Nexis and Chris Selland at HP-Vertica, who align their marketing demand gen efforts to account-based scoring… opportunities instead of leads.

When you combine inbound marketing with account-based scoring, you get a very potent combination of predictable opportunity funnel that also benefits from lower customer acquisition costs. The latter is essential for on-demand subscription models where customer acquisition costs (CAC) has to be recovered in a short upfront time period, and the former increases the volume of business funnel to work through, again essential in any business that has a wide range of pricing options, from free to enterprise license agreements.

When I took over the team in the 4th quarter of last year I made a couple of quick changes, most significantly breaking up the demand gen team into distinctive task teams focused on net new customers, base expansion, and retention outcomes. The demand center teams would respond to product & solution marketing, as well as partner marketing to drive campaigns, content, events, and interactive (SEO/SEM) for the specific outcome being targeted. We roll this up with a range of sales and marketing operations activities to drive opportunities, which are companies who buy our stuff as opposed to discrete contacts at companies.

I am fortunate to have a data scientist on my team, a PhD in statistics no less, who also has a keen ability to aggregate data from many different sources, from Salesforce to Splunk. We know from this data that there are tipping points that occur in the opportunity (account) scoring that should and do cause additional sales activity. I won’t share the specifics here because they represent hard won intelligence that is a form of IP for us, but I also believe that much of this is actually not easily transferred to another company like us. In other words, each company needs to learn the unique attributes and dynamics of their sales and marketing model rather than simply copying what another company is doing.

Underlying all of our marketing strategy is the notion that we, as a business, have grown in size to the point that we are beyond the point that generalists, high bandwidth people who can do a lot of things well, will serve our growth. We have made a number of changes in the team composition in order to achieve a high degree of specialization in each function… I want the best people at each position in the team. The equation is simple, we use people and systems to feed a data model that we constantly iterate to explain and then predict our performance. 

I saw this fascinating video of a Ferrari F1 pit stop that reminded me of what we are striving to achieve. Each pit crew member has a job and there is no confusion about who is doing what. Notice how the crew members responsible for removing the front wheels know exactly where to place their hands in order to capture the approaching race car… this is the level of specialization that we are building.

Mozilla’s Diversity Problem

lynch mobThe lynch mob mentality that put Mozilla’s CEO out of a job has been well covered and while shameful at every level, I didn’t expect to comment on how badly Mozilla stumbled on this… but here I am.

What really got under my skin is the self-righteous indignation expressed by those calling for Eich’s ouster. The guy paid a price no one should have to pay for exercising the right we all carry to express our views in the form of political speech, yet that is impossible when it comes to gay marriage because to have any view other than one of support for gay marriage is equivocated to being homophobic. Are these same forces suggesting that the 7 million people in CA that voted for Prop 8 should also be run out of their jobs and publicly shamed? If so, the case against campaign finance reform has been conclusively made.

However, rather than dwell on the social commentary, which is what it is, or gay marriage, which is something I fall into the “indifferent” camp of neither supporting nor opposing (I just don’t really care), let’s focus on how badly Mozilla looks in all this. Organizations are often defined by crisis and in this case Mozilla demonstrated a failure of values by caving to a pitchfork wielding mob and in the process suppressing the ability for anyone at Mozilla to have an independent view that is not validated by kow-towing to the loudest voices at Mozilla.

I thought of two recent examples of companies that demonstrated their values in moments of backlash, Coca-Cola and Honey Maid, the graham cracker company. Coca-Cola faced a minor consumer backlash over an ad that ran in the Super Bowl featuring America the Beautiful being sung in different languages. Coke didn’t back down and regardless of where you stand on any of these issues you have to admire a company that is willing to put it’s values at a higher priority than revenue… however in this case they may have actually suffered more damage if they walked it back given their prominence in Latin America. Either way, good on them.

The more interesting example is Honey Maid graham crackers, which ran ads featuring multi-racial and same-sex couples. Like Coke, they faced a consumer backlash however rather than simply riding it out, Honey Maid doubled down and released a follow on piece. That took balls.

You may be tempted to say that Coke and Honey Maid had it easy because the issues they addressed are rising in prominence and acceptance. However, the only distinction I see between companies that express support for issues that are gaining in popularity and what Mozilla did is that Mozilla faced a test that everyone should care about, which is that when you go to work the way you conduct yourself in the workplace matters is what counts, and that your personal opinions should be respected and protected. They failed and it will take Mozilla years to recover from the stench of running a co-founder out of the organization for having the audacity to have a personal view that was not aligned with the Moral Majority that apparently runs the place. The message is clear, if your view is not in the Mozilla mainstream then shut up because the only opinions that count are not yours.

I expressed myself by uninstalling Firefox.

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Abandoning Wearables

A report is out today suggesting that up to 1/3 of wearable computing users are abandoning the devices.

That observation is strengthened by research from Endeavour Partners in the US, which found that one-third of American consumers who have owned a wearable product stopped using it within six months. What’s more, while one in 10 American adults own some form of activity tracker, half of them no longer use it.

We are still in the early phase of wearables and this data needs to be taken with that perspective, there is a lot of experimentation necessary to find the right mix of function, fashion, and utility. Samsung, in particular, has demonstrated a tendency to release devices that are intended to demonstrate a market opportunity while continuing to iterate the design to later maximize on it. This is something that should be encouraged.

My own experience with a Fitbix Flex fitness tracker is in line with the research covered above. I initially embraced the device and was diligent about interacting with it, then after about 3 months the silicone band broke and replacing it didn’t seem like a priority. I wasn’t getting a lot of utility out of the Fitbit, it does a couple of things (and the sleep function clearly doesn’t work well) and it just didn’t add anything to my life so putting it on the shelf was an easy decision. The other challenge is that it isn’t extensible, Fitbit hasn’t provided a third party market for apps that do anything more than what Fitbit provides itself… utility is a function of what the device itself does along with what third parties support.

xl_samsung-galaxy-gear-phoneThe Samsung Gear is a different example and having talked with people who have had it the issue that comes up is that the first gen device was a novelty more than anything else, and having something tethered to your smartphone is really only as good as the reliability of the connection. The Gear seems plagued with bluetooth connectivity problems that make it unreliable in this regard.

google-wearableThis is a fast evolving market and I am optimistic about where it is going, especially in light of recent announcements from Google and others that demonstrate devices that are significantly improved over previous generations. Curved displays, improved batteries, and richer development environments point to a better future for wearables.

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Twitter’s Problems

Twitter is having a bad day.

Chart forTwitter, Inc. (TWTR)

They did put up some good numbers, indicating real progress on their revenue management, which is just another way of saying they are now a successful ad platform. Great, but that’s only as good as your ability to drive audience growth and engagement, and here Twitter is having a real challenge.

When I click on random profiles in Twitter I can see the problem in realtime, there is a significant clustering of people how follow low single digits and are followed by a fraction of that number. The utility of Twitter increases by multiples as personal network thresholds are crossed, but if that increase is driven by a blunt force trauma approach of following everyone you find then the quality goes inverse to the network size.

So problem #1 is how to get people ramped up to a level that they derive utility from Twitter without resorting to spamming your entire gmail address book or sucking your Facebook contact list into your new Twitter account.

Next is the format of Twitter’s message has been both blessing and curse, and the timeline has proven to be pretty resistant to alternate presentation formats (conversation view, sorting, etc.). The former has been a problem for Twitter from day 1 while the latter is kind of surprising.

Facebook, by contrast, offers a lot of depth in the personal profile that imbues it with a sense of destination. you go to people’s profile pages in Facebook because there are photos, apps, timeline, videos and more. not so in Twitter.

Problem #2, create more personalization while also providing a richer message format.

The third problem is a tough one, most people don’t have interesting things to share in a broadcast format. even broadcasters don’t have interesting things to say over Twitter. Trending topics is a great way to discover breaking news content but it is invariably limited by the network wide approach they use, I can’t say “give me trending for my zipcode, my commute, my school, my travel schedule.”. This is where Google is really on to something with Google Now, it is exclusively relevant to me.

Problem #3, create interesting moments for *me* through the network.

I like Twitter but admit that I use it primarily to share content through, I don’t provide much in the way of editorial content because Twitter doesn’t allow me to do that the way that Facebook and LinkedIn do, and both of those networks appeal to professional and personal networks uniquely while Twitter is somewhat stuck in the middle. Dick Costolo says they have to make it possible for people to “get it” in the first minute. that’s pretty hard to do in a service that has as an intrinsic requirement connecting with other people as a critical path to getting the feedback loop established. Tough problem, I wouldn’t want to have to solve it in the spotlight of being a public company. in a way Twitter is experiencing today what Facebook had to go through on the day of their IPO.

Celebrating Human Achievement

I love advertising, not the advertising business but the ability of good advertising to tell a story, tap into emotion, inspire us, motivate us, and create a sense of purpose is powerful. Sure, advertising is selling stuff and it would be easy to be cynical about it, but the art of advertising done well transcends commerce and touches us in a way that we often don’t even realize.

This ad celebrating the simple act of a grown man learning to read does all of the above.

The Decline and Rebirth of Retail

Jeff Jordan has an interesting post that looks at long terms trends in retail and more recent news, suggesting an acceleration that is itself a tipping point to the benefit of online. It’s hard to argue with the trends he is pointing out, however that is not the entire story, or at least the interesting one to me.

To look at physical retail and suggest that online will overtake it is not where the story ends. Physical retail won’t stand still, and much like other points in it’s history it will go through a transformation that results in a much different retail industry than we see today.

The next generation of retail likely looks like a hybrid business that brings the convenience of online with the merchandising aspects and physical customer experience of traditional retail together. Okay, that much is probably obvious but if we peel back the covers we could probably identify some interesting intersection points between the two retail models, starting with the distribution capability.

Traditional retail has a distribution model built for store fulfillment, and in parallel they have built distribution centers for online retail fulfillment. 3rd party logistics providers (3PLs) have gotten pretty efficient at template distribution models, scaled appropriately and completely turnkey, an efficiency that no doubt will continue and the result will be unburdening the retailer with significant capital costs if they chose to take this path.

Online retail is not without it’s own costs and discovery is increasing at a rate that will pinch online retailers on their bottom line. If you are Amazon you don’t worry about this, but for everyone else you have to focus a lot of effort on finding people who are not driving by your physical stores daily. Organic SEO is an art and for popular searches a vendor site will rarely display, and SEM is expensive for popular keywords. How else will you get traffic to your site to feed the funnel. a youtube video that takes off? I wouldn’t suggest you build your business model around that.

Jordan highlights a number of news items to support his thesis and while I take the intention they are provided in, I can’t help but highlight a few alternate theories. He writes “it’s getting hard to find a physical book, music or video store these days,” and while true this is easily attributed to the change in consumption habits instead of how people buy these products. I’m also not aware of where I can find a paper scroll store these days. The shift to digital content drives this disruption, not the retail model. how would you go to a physical retailer to get streaming content?

The apparel retailers Jordan highlights are suffering for reasons not associated with the shift to digital, namely the singular focus on a demographic group that has left them behind. Trends change and brands lose their luster, this is not new nor is it caused by online retail. In fact, I would argue that if any segment is insulated from being overtaken by online, it is apparel but the problem is that many physical apparel retailers still think of themselves as a retailer instead of a combined media and retail business. One online retailer that points to a future that could be embraced by physical retailers is the Net-a-Porter company, which for men is represented as the mrporter.com site. It’s a clever adaptation of storytelling and merchandising that should be embraced by physical retailers as a way of sustaining margins and managing an audience instead of just attracting customers with promotions.

I could go through each example Jordan uses and offer an alternate theory for their decline. Maybe in aggregate the trend Jordan highlights is supported by the examples but perhaps they are just complex individual cases of a business cycle playing out. Therefore, the question that we should be considering is the degree to which online retail is growing the entire retail industry, not just transferring business from physical to online.

Regardless of how much I am pro-online retail (300+ Amazon transactions alone last year, on any given day all of the major delivery services are stopping and depositing a small mountain of boxes. there are few things I won’t buy online), I can’t help but admit that physical retail has many appeals and with smart transformation could give online retail a run. Retailers will need to abandon many of the philosophical tenets that have sustained the industry for decades and unlike previous evolutions this is not going to be a crank of the wheel and a tuck here and there, physical retailers need full scale transformation to come out on the other end and only the healthy ones will have the strength to get through it.

UPDATE: McKinsey has a great article on the retail and they explore the ability for retailers to use multichannel strategies to turn stores from liabilities into competitive weapons.