Revenue growth focused posts

FINRA Regulatory Notice 10-06: For Compliance Guidance Only

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Every day there is an article like this one in a local newspaper sympathizing with someone who was fired because of something they posed online. Thankfully for registered representatives, FINRA is catching up with the digital age and addressed the issue of regulation and social media, fittingly, on its blog. In early January 2010 it released Regulatory Notice 10-06 which is intended to serve as guidance for Registered Representatives. Though short by FINRA standards at only ten pages, it is as monotonous as other FINRA publications. But true to form it does spell out some key things to keep in mind when using social tools:

Record Keeping

Because Twitter, Facebook and any of the other numerous social networking tools are written communication, the correspondences must be retained if they relate to “business as such.” The content of the particular post governs if it falls under the record keeping regulation or not. There are tools from Arkovi and Socialware that help address this.

Suitability

The same FINRA rules apply to social media as every other communication with customers. FINRA suggests going in two different directions with maintaining Suitability compliance. You may either a) make recommendations but only let suitable customers see them or b) don’t make recommendations. Make sure that either your settings or comments are restrained enough to not allow a recommendation to be seen by the wrong person.

Static

Blogs, being a static environment, are considered advertising and must be approved by a regulatory principal. This means that both Suitability and Record Keeping regulations apply.

Interactive

Unlike other the social communications mentioned above, posting on Forums is considered a public appearance and is regulated by the same Rule (2210) that would govern any event you were at in person. The same standard applies to the comment areas of blogs, Facebook walls and other areas with interactive ability.

Facebook

Facebook content falls under both of the two categories listed above. The Profile, pictures, banner ads and any content that users can’t interact with is considered static and must be approved by an appropriate regulatory principal. The wall, comments and any other content that non-firm employees can comment on, poke or engage in some activity is considered interactive. This means that a regulatory principal does not need to approve communications before posting. Due to an employee posting, well, anything on their employer’s wall could be construed as advertising it is not advisable to post non-approved principal approved comments.

As illuminating as this publication was, it is still merely guidance which FINRA offered to shed some light on these key issues. With social media and all other communication tools – Hello, Reply All button – common sense will protect will protect you more often and fully than any compliance officer ever can.

Stay tuned for more articles addressing platform specific concerns.

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Too Social?

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I gave up Facebook for Lent. The funny thing is, I’m Buddhist. Well, raised Buddhist. Anyways, as I was trying to get my kids to eat their dinner, I was on Facebook reading about what my friends were feeding their kids. It suddenly occurred to me that I had been spending too much time there and needed to prioritize. So, I instantly deactivated my account.

I felt completely liberated the first day without Facebook. I was free of the need to come up with witty status updates, free of the ‘obligation’ to share good information, free of the curiosity of what my friends were up to.

The second day, I still didn’t miss my friends. I missed the information I get from the pages I “like.” I never realized that Facebook had been my primary source for the news and topics I cared about. Right after I deactivated my account, I read an article that Facebook was now the biggest news organization in the world. Great. I gave up Facebook for Lent and won’t be signing in again until Easter. What was I to do?

I turned to my Twitter account. It had been a while, since Facebook was all I “had time for.”

Immediately, I was overwhelmed by the many 140 character bits of information from the 89 people, companies, groups that I had initially started following. Was I following too many or were too many Tweeting too much? I cared about all of them, but who do I stop following?

John Stone wrote, “think quality versus quantity” when it comes to blogs. Truly, the same applies to Twitter, Facebook, and other social media sites. Especially for business and organizations, the quality of the posts and the information shared needs to be thoughtful and valuable to maintain the interest and keep the trust of their followers. Too much information creates follower fatigue. That’s what happened to me on Facebook. In one day, I was beginning to happen with Twitter.

I like my news. I like getting them via social sites. We advise our clients to value an editorial perspective and a careful selection of relevant posts. I hope the companies and groups I follow on Facebook and Twitter do the same.

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Participatory Marketing and Audience Engagement

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This blog has discussed various aspects of Permission Marketing at (see here or here) however there has been a recent trend of Participatory or “opt-in” marketing. This post explains a few techniques that two firms (with very different products) are using. Both of these companies have fulfilled five of the steps we outlined previously to generate prospective clients and along the way used several key attributes required in a participatory community:

1. Low Barrier to Entry

2. Support for creating and sharing ideas

3. Informal Mentorship

4. Participants feel their contributions matter

5. Participants engage in a community

These two particular companies are being exemplified because they both fulfill the requirements of inbound content: Entertain and Educate.

E*Trade Babymail: Entertain

The E*Trade baby has reached meme status after his debut during Super Bowl XLII and has been parodied by a few comedy talk shows and a headlining sit-com. In addition to this year’s Super Bowl Ad, the E*Trade baby has also been launched in a write-your-own-skit via www.etradebabymail.com. The website allows visitors to create their own talking baby segments which, naturally depending on the comedic prowess of the user, can be hilarious. While the actual use of the tool has nothing to do with E*Trade’s core business, website and email of the clip sent to the user’s friends is peppered with implicit advertising.

More importantly, E*Trade’s main marketing vehicle becomes participatory. The simplicity of the website all but removes the barrier of entry for the user both to the tool and the brand. The dual effect of this is to increase civic engagement and provide strong support for creating and sharing the creations with others. The first increases brand engagement while the second increased brand exposure to the user’s friends. E*Trade has provided the tool to create a participatory culture which shifts the focus from individual expression and consumption to community involvement.

Zacks Investment Research: Educate

The day after initiating coverage of Trius Therapeutics (TSRX), Zacks Investment Research published an article on SeekingAlpha.com explaining the analysis behind the firm’s initiation of coverage with an outperform rating. The forum is as important as the content for this example.

Seeking Alpha self-describes as “the premier website for actionable stock market opinion and analysis, and vibrant, intelligent finance discussion.” The model of the website is simple: Unpaid authors contribute, editors cull, readers read and the platform collects revenues from advertising. An important structural feature of the website is that it is made clear that anyone can submit an article for publication. This enables participation of members who believe that their contributions matter and who feel some degree of social connection with each other. Zacks released their report on this particular website because of the single biggest thing they and Seeking Alpha have in common is audience: individual investors looking to for an edge.

Zacks’ poster, Jason Napodano, comments on his own article first – with an offer of the 20 page Initiation Report for free (!) if you email him. He also provides thoughtful responses to the community’s questions and critiques. The entire dialogue is available for public consumption and comment.

Conclusion

Reviewing the points we outlined in our discussion of constructive content marketing, both of these firms selected their vehicles and content to be relevant, integrated, aligned, “peanut butter” (sticky and spreadable) and – most importantly – free. Let’s run through the list of attributes (and their manifestations) that a healthy participatory community has once again:

1. Low Barrier to Entry – Free internet sites

2. Support for creating and sharing ideas – The tool to create a presentation or post a comment

3. Informal Mentorship – Watch other user’s clips and forum postings

4. Participants feel their contributions matter, or at least are seen – See above

5. Participants engage in a community and therefore create a social connection – The Result

It is useful to note the specificity of both advertising methods: A Super Bowl ad exposes about as broad a spectrum of possible clients as a single thirty second spot can get while posting a (what is normally paid content) article on a website for readers with specific interest exposes a narrow band of possible consumers. These are two very different methods, both in audience and cost, to produce audience engagement. Both of these cases have the requisite value exchange for this Permission marketing to be consumed, enjoyed and passed along.

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Don't Let the Fruit (of Your Marketing Efforts) Die on the Vine

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While companies ramp up their inbound marketing campaigns, something is happening to their house lists… they are getting tired. Naturally, hot leads find their way to sales. The rest of the new warm leads need nurturing, so they don’t die on the vine. Sending message after message may not get those warm leads any hotter. Unless those messages are targeted, relevant, and timely, companies are only exhausting their lists. The audience loses interest. Now, that’s rotten!

So, what are we left to do?

Continuing inbound marketing campaigns to keep feeding the database with new leads is an option. Augmenting the lists with third-party information to build a fuller profile, is another option. Analyzing customer lists, creating segmentation and a scoring system can help one gain a better understanding of customer’s needs. That is an option too.

No one, especially those in the B2B space, wants to see potentially good lead die on the vine. Sales people don’t want to waste their time calling cold or unqualified leads. Capturing leads, getting as much information as you can to build a profile, and segmenting them into groups is the first step to nurturing leads. Using the customer analysis, one can create targeted relevant messages to re-energize interest. This is the second part of the equation to keeping leads healthy. These tactics help marketers care and nurture healthy leads until they’re ripe sales opportunities.

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Content is Still King

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An old friend recently introduced a new service that allows the Twitterati to monetize their tweets “MyLinkMyAds”. It’s a brilliant and simple idea that allows people to get paid for the content and knowledge they are sharing.

Like most of what happens on the Internet today, the idea came to fruition quickly and since my friend is a talented developer with a strong social network already, he was able to get his idea online and introduced to the Twittersphere easily.

Then a funny thing happened. He saw a Tweet come through, that basically said, “Great tool for adding ads to your tweets; but I can’t find much detail on it.”

My friend had forgotten a critical element of doing business on-line. Even in a world of 141 characters, you can’t get very far without content and information to validate your brand. He quickly rectified the issue, and added an FAQ page to the site.

It’s a basic principle, but one that is often forgotten in the lightening fast business world today. You may get attention and eyeshare on Twitter, but in order to truly use social media effectively you need to deliver expertise, in-depth knowledge and valuable information as well. As you embrace social media remember you still need to provide access to videos, podcasts, blogs, even old-school data sheets and Web content to share details and legitimize your brand.

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MIT Sloan Sales Lecture

I have been invited to speak as a guest lecturer at the MIT Sloan Sales Club on February 23 and when considering the right focus for the session, an important sales transformation issue came top of mind.

Call it sales 2.0 perhaps, but the real transformation has come from the intense competitive challenge and the need for a differentiated relationship process.

MIT Sloan Sales Club

Today’s sales teams clearly can no longer work through the phone book or the local business journal lists to find the target buyer. Today, sales managers must put together a far more integrated demand generation program and team up with marketing to make it happen.

In the session, I will explore the new dynamics of sales in today’s digital context. I will explore selling from the lens of the sales manager who must now orchestrate an integrated sales engine from demand generation and lead nurture to sales excellence and account management. In today’s environment, a fully aligned sales and marketing capability and integrated multi-touch campaigns are critical and sales must embrace new technology, content marketing and persuasive communications to meet targets.

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Your Blog: Quality over Quantity

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There are likely different schools of thought on this and there are SEO metrics that can prove or disprove the visibility impact of more posts vs. fewer posts, but in my opinion less can be more and quality beats quantity. As the cobbler’s children, we are still enhancing our blog post capacity and shortly, our core team will be more consistently writing posts. But our objective is not to game the SEO system with inbound leads. Our goal is to share articles and perspectives that we think might add some value to our readers and continue the conversations we have every day.

With the increasing spamming of the social web, we are in danger of losing site of the true value of content. I get very concerned when clients consider mass article writing strategies – particularly those clients that market and sell a complex product or service to a sophisticated buyer. These readers know when they are being trapped with content proliferation. Now the buzz is content curation – we need to be careful here too. We don’t need someone to simply compile articles, but we do value an editorial perspective and a careful selection of relevant posts. If I trust you, I will trust the links and content you collect and share.

So, rather than stuff your website with trash blog posts and articles every day, if you are trying to reach a more discerning audience, think quality over quantity.

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2011 Top Ten List for Revenue Growth

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We had fun this year with our holiday greeting and we offered a top 10 list of resolutions. Why not share it with the blog reading audience.

We hope you can be:

  1. Visible… Get to the top of search results page with your content and SEO strategy.
  2. Present… Extend your brand beyond your website with social media outposts.
  3. Approachable… Build relationships by being authentic in your online dialog.
  4. Focused… Identify your strongest niche markets and tailor your value proposition.
  5. Nurturing… Help your prospects remember you and understand your value.
  6. Synchronized… Develop a revenue attack plan that aligns marketing and sales teams.
  7. Automated… Use marketing and sales technology to free up time for new ideas.
  8. Relevant… Provide the content that your customers value.
  9. Tenacious… Follow-up on your leads and manage your account relationships deeply.
  10. Engaging… Make your story more entertaining with video, mobile and multi-media.

Some might say- “OK, but I already have these items on my wish list… how do I get them all done?” To that I would ask whether they have a plan in place.

  • Have you clarified your strategy?
  • Is everyone on board – including both marketing and sales?
  • Have you prioritized and considered the dependencies (people, skills, process, technology)?
  • Can you place initiatives into a timeline and a release plan (must, could, should)?
  • Do you have the right team and skills to execute?
  • Do you know the budget required?
  • Is the ROI clear?

If you can’t answer these, it is worth a little time to get organized – it will save you in the long run. Most every client we work with is on a continuous path to maturity around each of these areas and the bar keeps moving. Just when you think you have your content marketing plan in place with relevant articles and blog posts, you realize digital video is more important to reach audience and communicate message.

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Why You Should (re)Tweet

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Successful tweeting is about focus. Numerous companies small and large have shown that diligently writing a few tweets with content their customers want to read can greatly increase connection that a person has to the company. Even more common are twitter feeds that are rarely read and pretty much irrelevant. The difference is focus. Treating a feed like it is business will go unnoticed. Treating a feed like a friendly conversation will get noticed. Think of it as telling a friend “I liked this article and you probably will to.”

By doing something as simple as tweeting news articles or retweeting other’s valuable tweets that your firm’s clients want to read makes your twitter feed worth reading. The simple truth is that most people don’t want to spend their time finding news that directly pertains to them in the vastness of digital information.

The number of news outlets has risen exponentially in the past decade. Just as books became significantly cheaper and more available after the Gutenberg press, the internet has again dropped the cost of publishing to a new level. One of the numerous side effects is that the amount being published has risen and, because content is king, newspapers have been publishing more because their main reason for not publishing has all but disappeared: Cost.

The cost of publishing, as Clay Shirky has told us, was the main deterrent for publishing articles that consumers wouldn’t read. Publishing too many unread articles would lead to decreases in readership then subscriptions and eventually profits. The cost lowering effect of internet media has removed that physical barrier on printed page real estate. It is this cost reduction that has lead to a decrease in the inherent filtering that newspapers perform and hence an increase in total articles published. This has lead to the popular notion of “Information Overload.”

This impression isn’t exactly accurate because since shortly after the Gutenberg press was invented there were more books than a human could physically read in a lifetime. The difference between printed and e-newspapers eras is a question of filtering. Trusted newspapers became trusted because filtered for to find the best of “all the news that’s fit to print” and printed quality, vetted news that their readership wanted to read. By becoming the filter for your audience you become the source. Using the retweet function can increase your Social Capitol because you are the filter. As any retailer will tell you, being the source is good for business.

Retweet – and be the filter – so that you are the source.

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Key Topics from the HBS Discussion on Digital Business

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We had a packed room at Harvard Business School on November 17 to discuss experiences in developing digital businesses.

HBSEntrepreneur

Mike Roberts, a James M. Collins Senior Lecturer and Executive Director at the Arthur Rock Center for Entrepreneurship put the speaker team together and it included some highly experienced HBS students, recent students and entrepreneurs sharing their experiences in building digital businesses. The team included Maxwell Wessel, Brent Grinna and Lincoln Edwards. Our moderator, Christopher Michel both facilitated the session and delivered a lot of value as an accomplished entrepreneur. Brent is an MBA ’10 grad who is incubating his start-up, Evertrue at a Venrock-backed company in Boston called Where. Maxwell and Lincoln also represented some fresh and real experiences launching digital applications. I was put forward by our client colleagues at Bain Capital Ventures and MITX. My role was to bring a perspective as both a service provider to the industry and as an entrepreneur building digital businesses.

Most of the 100+ attendees were midstream with plans to launch digital businesses. There were Arthur Rock Center for Entrepreneurship scholars and others, and they surfaced a range of issues. Christopher Michel, the facilitator was back from a month in Tibet but was able to jump right in and drive the conversation. The challenge was to share some perspectives on how to go about a web development project, how to engage effectively technology team and how and whether to outsource to an offshore provider. Qestions included:

  • How and whether to outsource technical development?
  • How does an HBS entrepreneur engage the right technical leaders in partnership to launch a digital business?
  • What are some of the better offshore partners?
  • What are other considerations in building a digital business?

Some headline conclusions were:

How and whether to outsource technical development?

The outsourcing model makes a great deal of sense for elements if not all of the development process. It is particularly strong for low cost prototyping efforts at the early stages of concept development. A critical success factor will be having a technical member of the core team to help oversee the outsourced team. Some of the considerations we discussed were location – whether offshore in India, Eastern Europe, Asia or South America makes sense and how language, time zones impact these choices. There are also highly varied levels of offshore resources ranging from one or two people in India to global sourcing firms. The choice of who to select should consider the technical complexity and technology frameworks used, the ability to work in a highly effective communication process. Keep in mind as well the location and documentation of the code base to ensure sustainability if things go wrong with the relationship. Using milestone payments for documented code releases can be an effective model. Most of the digital applications in this discussion were based on a custom build approach – for companies looking to outsource web development for standards based platforms like WordPress, Joomla and Drupal, the options are many and the risks more manageable.

How does an HBS entrepreneur engage the right technical leaders in partnership to launch a digital business?

The days of heading down to Kendall Square and lining up a development team from MIT are perhaps gone. In fact, it may be the reverse. The MIT Technologist heading to Harvard Square to line up a business team for his/her digital venture. But the real truth is that a digital business cannot be successful – in my opinion – without a highly trusted core team member that is also a technologist. The role is critical to ensure an effective development process and effectively translate a business vision into a solution. This is particularly true if the team uses an offshore provider to build out the system.

What are some of the better offshore partners?

Many were brought up in the discussion, and there are many firms that specialize in different segments of the outsourced environments. The checklist should include competencies around the current technology platforms needed in the development, the approach to project management, the ability to communicate in English in a trusted way. Above all, the provider needs to be a trusted partner and you can’t rely solely on the ratings in the freelancer systems as these organizations change. Make sure you discus options and get personal referrals where possible and use win-win contract structures. What is the CMM level of the firm? Will the team be dedicated? How do you communicate, Skype? Are all the skills considered – user experience and branding? Functional design? Technical implementation? Testing? By developing a personal relationship with the provider team and meeting face-to-face, you can build long term trusted relationship and realize strong returns on investment.

What are other considerations in building a digital business?

A few other considerations were brought up. Technology is only a small part of the business model. How will the team operationalize the business? How is the the governance structure set up? How is equity and compensation structured? When executing a project, what is the right development model? Iterative? Waterfall? How do you ensure confidentiality? How will the application be supported over the longer term? What are program, regulatory, operational and sourcing risks and how should they be managed?

Final Remarks

Debi Kleiman who recently took over leadership of MITX from Kiki Mills offered a strong closing argument about the benefits of membership and the supporting focus of the MITX organization as a resource for students and others pursuing a digital business.

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