Over the social hype hump and back to practicality



Sensible voices are starting to be heard again above the noise as the new social enterprise realities mature
Cross posted on my ‘ZDNet Collaboration 2.0‘, whose profit center is display advertising…

There’s a sense of deja vu about some current funded digital entrepreneur and public technology company business models. I started writing this post last Friday after reading a piece in USA Today from 2001 titled ‘Dot-coms look beyond ‘stickiness’ and ‘eyeballs’ while doing some research for a project.

That Reuters piece happened to have been published on the same date as last Friday eleven years ago and starts ‘The Internet industry has quickly learned that “stickiness” and a lot of “eyeballs” do not add up to profits…‘.

Sound familiar to the cold shower reality check many of the more absurd social business ideas have encountered recently? The last fifteen months has also been accompanied by a blizzard of dubious ‘research’ statistics, colorful infographics full of mostly unqualified percentage figures, all made worse by the low barrier to self publishing by self proclaimed experts our digitally transformed world has enabled.

I’ve been preached to by VC’s and regaled with PR messaging masquerading as strategy by some technology companies, who claim to have invented unique new work and marketing methods in ways that have been all to reminiscent of the height of the dot com era.

To quote George SantayanaThose who cannot remember the past are condemned to repeat it” -but fortunately there are a large number of grounded, sensible people who are not only all to aware of the dot com era’s lessons, but also have a good feel for what actually works in the digital strategy world. These voices are starting to be heard above the noise again.

It’s never the same twice of course and today’s fundamentals are very different to the Wall Street pump and dump and tax write off dot bomb era. Just as the web went on to fundamentally change the way we live and connect after the dotcom/infosuperhighway/cyberspace etc etc hype calmed down, so our new socially networked era has hit mainstream and continues to invoke colossal change …even as past funding logic foundations poster children such as Facebook stumble.

Quoting tech investor writer John Shinal’s ‘What the Facebook skeptics know‘ on Marketwatch

Every quarter, a greater percentage of Facebook’s most active users are accessing its site via mobile devices, rather than desktop PCs. And the ad revenues in mobile advertising are so far just a fraction of those for traditional Web-based ads.

This is a significant individual end use pattern shift which the mass advertising business is not currently geared up for from a Wall Street revenues perspective, and they are also understandably fearful of cannibalizing revenue from traditional display advertising sources. This is true for Facebook or any other new digital medium, web or mobile, but now that we are arguably getting over the hype hump these issues are being addressed in a far more pragmatic, grounded way…by some at least.

Regarding those traditional display advertising sources Mathew Ingram on GigaOM wrote in ‘What happens to advertising in a world of streams?

…The cruel reality is that traditional advertising, with its banners and popups and site takeovers and other eye-grabbing tricks, is fundamentally irritating — and it becomes even more so when it interrupts a conversation or a social activity. As even advertising giant Sir Martin Sorrell of WPP has pointed out in comments about Facebook, the more socially oriented a service is, the more difficult it is to make advertising work in the way it did with more traditional forms of content and older platforms. Then, the reader was held captive to a certain extent, but in a world of digital streams that’s no longer the case.

This is the same conundrum as the dot com era, when display advertising was deemed to have months to live. It’s an intractable problem that isn’t going to go away this time around either; everyone loves an entertaining Super Bowl spot branding spot but no-one admits to buying a product from an infomercial or clicking on a banner.

Autodesk, the 3D modeling software company, purchased Socialcam for $60 million US dollars last month in a move reminiscent of dodgy end dot com era roll ups. (“The products do not make a lot of money, but they attract a lot of people” Quentin Hardy NYT)  Socialcam is a Facebook click through parasite and will have the longevity of the very similar Washington Post reader application, whose user figures fell off a cliff after it dawned on people to avoid it. This is clearly not an alternative to traditional display advertising, and I believe Autodesk massively overpaid for an application with very little value. Like the dot com boom era this was a move by Autodesk to get into an area which is way outside their core competency, seduced by todays siren song equivalents of ‘stickiness’ and ‘eyeballs’.

I pay a lot of money every month to Comcast Xfinity for cable television and business class internet, two divisions of the same company. I was unable to watch the NBC Olympic video coverage online because those two divisions are two separate business entities, a classic Customer Relationship Management fiasco. This to me is the perfect example of how a typical ‘consumer’, expects a company like Comcast to be cohesive internally in a perfect seamless loop around the service they provide around my customer needs, like Roger Berry’s ‘Perspectives’ infinity loop sculpture in the picture above..

What I got was customer service telephone hell talking to people with no answers to my issue in their script. I didn’t have much time to waste on this so I gave up and didn’t watch any live Olympics online. I whined on Twitter but no one at Comcast responded. Subsequent marketing by Comcast to me has resonated in a very negative way. In an ideal world Comcast would provide seamless content service across devices, with any support issues speedily resolved and marketing communication that reinforced a pleasurable experience.

Apple has set the bar on this approach and arguably as a direct result just overtook Microsoft’s dot com era figures as the most valuable company in the world ever, surpassing the Bill Gates high point 1999 market value record of $620.58bn. (IBM were probably worth more in 1967 at their zenith if you account for inflation, but that spoils my dot com era comparisons!). Customer satisfaction is fundamentally what drives this kind of performance at scale, and conversely is why cable TV companies are so unpopular with their captive customers.

Advertising, word of mouth, conversations and support are all icing on the cake of a well organized company, and that culture has to be at the organizational core. For a successful company there is typically more of everything: more internal transparency, more display advertising that dovetails with social network interactions, more attentive customer support and so on.

Many of the business people I have talked to and worked with over the past eighteen months are far to busy to wade through endless discussions and propositions about social possibilities: they are very focused on specific goals. Context is king, and so are measurable results.

The end to end vision of the connected, social enterprise will define future competitive effectiveness, but boil the ocean propositions to the types of people who are constrained within business silos are usually a challenge to scale, even when there is aspiration and enthusiasm to create more network connections. What typically happens here is a social network for their silo, or a collaboration silo as I was calling this a couple of years ago. Multiples of these can have unintended consequences.

Despite the signal to noise ratio, there is a distinct shift happening right now, as success stories and ideas and competitive threats are absorbed by companies, with information streams and engagement ideas highly visible as key attributes.

Information streams and engagement models are manifestations of deeper planning – the tools put in place to get to specific goals – and we are seeing more serious engagement to get those foundational planning elements in place in our maturing digital world.


picture: Roger Berry sculpture ‘Perspectives’ commissioned by Cupertino civic art
located at intersection of Stevens Creek Blvd and De Anza Blvd in Cupertino, California USA

By Oliver Marks

Enterprise collaboration expertise

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