Moving On Over.........

After 3+ Years Blogging on Blogger I am moving domains to http://www.grahamlubie.com/. Come over and visit for more posts and analysis on:

• Strategy
• Product Management
• Product Marketing
• SaaS
• Cloud Computing
• Social Media
• The Social Marketing Framework
• Technology

Cheers,

 

Graham

The Dark Secret of Social Media....it's NOT free

Do a search on Google using the terms "social media free" and you get 242,000,000 results, then do a search on "social media costs" and you only get 92,200,000. Clearly 92 million is a lot of results, but the 2.5x difference seems to indicate a belief that Social Media  is Free. It is not - there are costs.

For the most part, these social media costs fall into the following general buckets:

• Internal Resource Costs - specifically the personnel costs required to initiate, monitor and respond to social media conversations; and the personnel costs required to create the content that is used. We are starting to see both new roles being created to focus on this area (e.g. social media coordinator, community managers, engagement specialists, etc.), and additional responsibilities being added to existing resource's plates (leading to a reduction of focus elsewhere).
• External Resource Costs - agency costs associated with supporting and advising social media activities, and the creation of content.
• Technology Costs - the tools needed to Monitor, Contribute and Measure social media conversations. Many basic tools are free, but premium and integrated suites like Radian6 or Hubspot have fees associated. (Shameless plug: to get up-to-date info on social media technologies, follow my daily Twitter feed for the "Social Marketing Apps - Clutter Buster Daily Tweet" @ www.twitter.com/grahamlubie or do a search on #socmktgapps)

Companies are beginning to realize that there is a cost to Social Media. According to a recent Social Media and Online PR Report by Econsultancy, 54% of companies identify "the biggest barrier to better social media engagement is the lack of resources. Now the key issue for companies to address, is where will the Social Media budget come from? Existing programs or an expansion of marketing budgets?

Official Transcript from Steve Ballmer and Rupert Murdoch's meeting

On Wednesday, the Internet was buzzing with the news that Steve Ballmer of Microsoft, and Rupert Murdoch or News Corp, were discussing an agreement that would allow Microsoft exclusive access to News Corp content. Here is the transcript from the Ballmer / Murdoch conversation that led to this announcement.

Ballmer:   "Rupert, we both have a problem and I think we can help each other. Google is leaching your revenues away by indexing your content for free. If you let it go on much longer, your Media Empire will be as profitable as a bunch of high-school newspapers. Google is a thorn in our side as well. I am okay with giving them search advertising, but they are using those revenues to compete with Office, Outlook, Windows Mobile, IE and everything else we do. So here's my idea - let's cut the legs out from under Google. I will buy the exclusive rights to index your News Corp content, and then show it as online search results. It reduces the value of Google's results, you make money, and we benefit. Frankly, were making no money on search advertising now and can only improve by having better content."

Murdoch: "I like the idea. We will charge search engine providers to index our content. No pay - no content. Hey, I spend a fortune on all those Wall Street Journal people and Google simply goes ahead and indexes the content, and then charges for ads on the search results pages. This way, I make money and you reduce Google's value and associated revenues. If Microsoft gets my Wall Street Journal content and maybe a couple of other Financial site's content, why would anybody with interest in financial information, every use Google? Brilliant."

Ballmer: "So Rupert, here is where we get a bit of revenge as well. Google and the other search engines will be forced to pay for premium content, and then either pass the costs on to their advertisers, or they will need to take a hit in their margins. If this idea reduces the market value of all search providers, too bad. Either way, I don't care. Advertising in over 90% of their revenues and under 10% of ours. Let's see them try come into our business sectors without their big advertising revenue stream."

Okay - so the transcript is not the official one from the Ballmer and Murdoch meetings, but you have got to admit, it does make business sense for both of them. It will be interesting to see how the discussions continue, and how Google counters.

Social Marketing Apps - Clutter Buster Daily Tweet

New Social Marketing apps are popping up every day, and it is tough to keep track of all the different players. So, starting today, I am sending a once-a-day Tweet highlighting an innovative Social Marketing app. Here's the general format: [AppName]-[Bit.ly URL]-[Type] #socmktgapps.

Break through the clutter.....click the "I Tweet Follow Me on Twitter button" and hear about the best and most innovative Social Marketing applications available on the market. 1 app will be highlighted Monday through Friday. So, sign-up and follow me on Twitter. My Twitter id is  http://twitter.com/grahamlubie. You may get a couple of other tweets occasionally, but only a handful at most.

See today's Tweet about a great, real-time conversation monitoring application. It's very cool.

(BTW - I am tagging these as Social Marketing vs. Social Media apps since they are specifically related to the marketing function. I believe that "Social Media" is broader in range and can address functions outside of just marketing and PR).

Outside The Box Thinking - Improv Training For Your Marketing Team

A recent Facebook post by Hubspot (inbound marketing SaaS provider) described how their marketing team was going through improve training. My first reaction was "Huh, improve training?" Could I understanding send a Product manager to a Pragmatic Marketing class? Yes. Would I send a Direct Marketer to a Marketing Sherpa Lead Gen Summit? Yes. But improve training?

After thinking about it a bit more, it makes sense. Given Hubspot's "inbound marketing" philosophy and their hypothesis that content is king, training your employees to improvise and create great content is valuable. Producing great content isn't easy and Hubspot produces a LOT of content like webinars, slideshares, podcasts, articles, whitepapers, videos, etc. So, given the large amount of content being created and the value of keeping that content fresh, it makes sense. It is also a great team building exercise.

Hubspot is not the only company that has tried comedy as a way to get their message recognized. About a year ago, Serena (developer of an enterprise mashup server) launched a video titled "Is Mashup a dirty word?". It has gotten over 1.2 million views on YouTube. IBM has also started doing humorous videos to push Mainframes. Yes - MAINFRAMES, and they have gotten almost 250,000 views of their YouTube skits.

So, while the videos are humorous, I do wonder about the value of them. How many of the viewers of these videos are actually in a position to buy a million dollar mainframe or mashup server? Probably a very, very, very small percentage. Do these videos makes sense from a marketing $ allocation standpoint or are they just another form of shotgun advertising? I don't know the answer for any of these three organizations, but I would suspect that their web analytical teams can tell if there is value, and if there wasn't any, they wouldn't continue to do them.

Micro ISVs are the Garage Bands of technology

Balsamiq (see prior post) bills itself as a Micro ISV. Until a couple of weeks ago, I had never heard the term "Micro ISV" so I decided to dig a bit deeper. My findings in a nutshell: Micro ISVs are a very interesting concept and are viable because of the seismic changes that we are experiencing in marketing and technology.

Here's a basic definition: "A Micro ISV is an Independent Software Vendor (ISV) that has just a handful of employees and is bootstrapped. Typically the software is distributed online and has a Freemium or Try-Then-Buy business model". The appeal of Micro ISVs is pretty much like being part of a Garage Band. You work on your songs, get a couple of gigs a month, and next thing you know, Rolling Stones is calling for interviews.

The cost of being a Micro ISV is now lower than ever before. Rather than spending a lot of $$s upfront, it is possible to deliver great software using a combination of open-source plus SaaS offerings. Here are some of the components, by function, that a Micro ISV can draw upon:

Product Development

• Open Source development stack (Linux, MySQL, etc.). Free
• Source control, issue tracking, roadmap management, test automation, etc. (Altassian)  $10 a month.

Operations:

• Virtual Instances of the application on Amazon (EC2, S3, SQS, RDS). There is no upfront hardware to buy and it covers both website hosting and operations. Nominal fee. Usage based.

Support:

• Community driven support forums, wikis, peer2peer support (GetSatisfacition + ZenDesk) <$30 a month.

Finance

• Online sales and subscription management (Spreedly). $20 a month + 1 to 3% of billings

Sales & Marketing:
Lastly, but most importantly is marketing and sales. Most Micro ISVs sell either single user software or SaaS, and have either a Freemium (ie. basic app is free, but premium features cost more) or Try-Then-Buy (ie. get 30 days free and then start paying) business model. So, the basic marketing and sales strategy is to (1) connect online with high volumes of users, and (2) get them to try the software. There are no sales teams out in the field, and marketing needs to leverage inbound interest, rather than traditional (read costly) outbound lead generation. To accomplish this, Inbound Marketing is key. By using social media (eg. blogs, SEM, Facebook groups, Twitter, etc.), viral marketing (eg. tell a friend options in the app, etc.), and online advertising (eg. PPC), it is possible to get tremendous exposure and generate revenues on a shoestring budget.

Balsamiq is a poster child of Micro ISVs. They have embraced system thinking and have generated tremendous online exposure. Within 12 months, they were generating over $1m in revenue with just 4 employees. Pretty impressive.

BTW: [I am currently advising a Micro ISV on their go to market strategy and product marketing approach. Expect to hear a lot more about them, and our Social Media techniques over the next few months.]

A Good Wireframe's Worth More Than A 1,000 Words

If you've ever designed a software product or built a complex website, you've gone through at least some of the following steps:

1. Gather Requirements
2. Brainstorm & Conceptualize using Wireframes
3. Do the Design
4. Develop
5. Test
6. Deploy

Well, step #2 of creating wireframes has gotten a whole lot easier with Balsamiq. It's a great tool for quickly creating wireframes and mockups. Balsamiq has a pallet of design components that allows you to do traditional client software, web-apps and mobile app wireframes. I recently used it to brainstorm an iPhone mobile app with a client. In just a couple of hours we were able to collaboratively do 80% of the screens and evolve how the different components would interact with one another.  Having predefined iPhone images made life so much easier than having to create them one by one. Here's an example of how a screen gets laid out in Balsamiq.

Balsamiq is definitely a keeper.