Polygraph Media Blog

Polygraph: Solving & more importantly Explaining Big Social Data, Facebook

Howdy everyone -- it's been awhile since I've posted here.  Lots of work on Polygraph and a new addition to my family in the form of a baby.  Margot Ellen Treadaway was born on December 14th and is our first child.  Lots of life changes -- all good.  But the blog has taken a bit of a back seat recently.

That's a-changin'.  Regular blogging is back for us as we bring Polygraph v2 to market.  I'll tell you more about that later.

But for now, I thought I'd better explain how our business has evolved and where it is going.  For those of you who have followed the Notice Technologies ride, you know that we've had quite the journey.

We started in 2009 with a couponing platform for local businesses.  We hit the streets and talked with as many local businesses as possible -- in an effort to build something perhaps a little less one-sided than Groupon in terms of who benefits from the transaction.  Local businesses were tough to work with because they demanded immediate results -- and didn't have the time or energy for anything that failed to generate immediate, incremental revenue.  Hence Groupon.  Groupon built tremendous value for itself, at least early... but much of it was at the *expense* instead of the *benefit* of the local business.  That's why Groupon remains a largely unsustainable business model -- and why we didn't (right or wrong) pursue group purchasing aggressively.  It's also why local businesses haven't gotten a revolutionary marketing platform yet.  It takes iteration, which local businesses simply aren't willing/able to do unlike other classes of customers.

We tried salvaging those couponing assets by offering them to newspaper groups.  But that became its own set of problems as you can imagine, and local media didn't prove to be much of a gainful opportunity for us.

All the while, we'd been hearing from people in agencies, brands, and other larger companies that measurement of social media was a huge pain point.  Facebook Insights didn't do the job well and still doesn't.  We saw an opportunity with our v1 of Polygraph to jump into the analytics fray.  And that's been a very positive move for us.

But we see a bigger trend and a bigger pain point in a lot of companies.  Businesses large and small are trying to better understand what value they're driving from social media.  It isn't enough for the world's leading companies to conduct best practices, adopt a social media management system, hire a consultant, or outsource social media to an agency.  The C-Suite really wants to know a few things:

• What business metrics are being affected by good social media execution?
• Is there a statistical relationship between social data and revenue or other mission-critical business outcomes?
• Do Facebook Ads and the like really work?
• How are competitors grappling with Facebook for customer outreach, customer service, and other marketing purposes?
• Is the social channel truly worthwhile?
• Should social earn a greater or lesser investment moving forward?

Who do CEOs and CMOs turn to for clear, data-driven answers to these questions?  They certainly can't turn to existing agencies of record -- they're too invested in a positive answer.  C-suite execs need a BS detector to tell them what the data says, and we're increasingly that BS detector.

Polygraph does an inventory of available data and collects it from Facebook for a company, its brands, its competitors, and its portfolio of Facebook assets.  We cache it, analyze it, and find relationships in the data.  Companies will sometimes give us other data sets that we'll add to our analysis -- such as web metrics, e-commerce results, or other mission-critical data.  We look at it all holistically to understand the customer engagement system -- how people discover the brand and make decisions to engage, interact, and make purchases (where applicable).  We seek understanding of the customer walk and conflict resolution -- are people using the brand's social assets as a customer service vehicle.

Ultimately, all of this data tells us a compelling story that can drive next steps.  Should you keep your existing agency or find a new one?  Does your portfolio of assets provide a return on investment?  Does social data correlate to real-world business metrics that matter to you?  Can we find evidence of causation?  Does social data move the needle or vice versa?

Understanding is what the C-suite craves today.  But the C-suite doesn't have it today. Agencies aren't independent arbiters aligned with the interests of a C-suite exec responsible for driving revenue and profit.  Unfortunately, very few marketers are equipped with the analysis chops necessary to make the case effectively also.  Sometimes, a marketer is equipped but isn't viewed as an independent, disinterested judge.

We're doing some fascinating projects right now in several major consumer industries that I wish we could talk more about -- but we're under NDA.  It's admittedly a little frustrating in that regard.  But you should know that the data unlocks fascinating insights that leading brands are beginning to uncover today. Truth lies in the social data. That's what we do -- collect, analyze, and drive insights from social data.

8 Observations from #mashcon (Mashable Connect)

I was fortunate to attend Mashable Connect late last week -- a great conference down in Orlando.  I don't have a ton of time to write right now, but I thought I'd jot down some observations.  Here were my takeaways:

1. Surprisingly (to me at least), I didn't hear a lot of innovation from the speakers.  The bigger companies innovating were really just showing off or describing their incremental advances on the iPad and in social.  The agency folks didn't really share anything I hadn't heard before and the startups were "eh".  No big deal but I didn't hear anything earthshattering and that shocked me a bit.
2. I though Michael Lazerow (@lazerow) from Buddy Media had an interesting vision.  It was almost a mini-pivot in that Buddy is moving from customized Facebook apps (where FBML once provided a "moat" but with the iFrame no longer does) to Social ROI.  Who knows how that will work.
3. I did talk with a lot of "social media cheerleaders', which is fine but to me indicative of both the fact that I was indeed at an industry event and that we're in a bubble.  Bubbles occur in any industry where there is rampant optimism and where skeptics are unpopular and their opinions are almost shocking.  An interesting data point for me was when @districtjoe (great guy) pointed out that I'm skeptical about everything and that he doesn't hear that often.  It's called an echo chamber & most folks at the event were squarely in it.
4. I loved @steverubel's clarity -- overall his presentation was great.  His explanation of the cloverleaf really made a lot of sense to me -- I had seen the illustration before but had not heard it described so well.
5. As is typically the case, there are a few brands who are silently & humbly kicking ass.  You know who you are -- and you know far more about the business than many of the invited speakers.
6. @scrollmotion dragged me kicking and screaming into submission.  The iPad (and the "tablet movement") is indeed real and here to stay.  Really impressive stuff.
7. I heard a great argument for Twitter from @jkrohrs, a new friend I made from ExactTarget.  I am not sure I totally agree with his points that Twitter is better for marketing than Facebook, but I understand the argument better just from spending a few minutes with him.  Smart guy.
8. Finally, this one has been covered a bit but I'll say it again -- tech startups are starting to behave more like agencies and vice versa.  Agencies control customer relationships and are finding small development projects that can be productized.  Tech companies are realizing the limitations of a software business model & can be much more profitable if they include a services/consulting component.  That's a dirty word for a lot of VC-funded tech startups, but it may make them financially viable and it can work out that way faster than the alternative.
9. (bonus) I really like Gowalla's clarity now.  They seemed to get caught up in "check-in mania" last year & it confused their value proposition.  Now they are enhancing experiences with location and vice versa.  Much clearer.  Much better.  The messaging and the approach fits them.  I hope they succeed.

Congrats to the Mashable team for a great event -- I really enjoyed it (maybe at times too much!!).

 

Status Updates, Social Data Mining, and Intelligence

Techcrunch ran an article yesterday on the Twitterer who unwittingly, unknowingly live tweeted the raid on Osama bin Laden's compound.  I thought it was a particularly interesting case that underscores a few things about social data mining -- an area where we've worked in earnest for about six months and where we are starting to make some real progress.

But first, a quick sidebar:

I've said numerous times that the "social" phenomenon of the present day is really a few things -- mapping of the social graph *and* the revolution in real-time/self-published data.

They are inherently different, although all the major social nets (Facebook, Twitter, LinkedIn, and YouTube) do both.

Twitter has mastered real-time data (for now).  As long as they don't freeze developers out of using the data stream, they'll be OK.  If they get too cute, they'll kill the golden goose and developers will innovate around Facebook's status updates and/or a Twitter competitor will emerge.

Facebook is the winner of the social graph (for now).  Similarly, if they just execute their plan and not freeze developers out of the social graph, they'll too be OK.  

So whether or not you like Facebook and Twitter, both are undeniably capturing a record of history like no other entity that ha scome before it.  Historians will have a field day poring over records of Tweets and Facebook updates to recount history as told and experienced by normal people.

Speed and transparency to relevant information are being redefined.  Tech-savvy observers of the bin Laden story knew that the best way to get the latest information was to run a search on http://search.twitter.com -- not to listen to the live broadcast of your favorite news outlet.

We discovered that 15 years ago at STRATFOR when we mined Lexis Nexis for relevant data and information as traditional news outlets relied upon tried & true methods of gathering news.  Lexis Nexis was just a digitized collection of articles -- certainly higher quality than the public stream of consciousness but more or less conceptually the same.

And even 15 years later, mining the Internet and real-time data is still the name of the game.  Facebook and Twitter users are people who (for their own reasons) talk about things they experience every day.  They do so in the open yet in relative anonymity because of the volume of the stream.  Decision makers who can pull out the intelligent nuggets from amidst the noise will beat other people who rely on others to tell them what is important, and there are implications in a variety of industries.  Consider the following:

• The aforementionied Twitter user who live tweeted the operation in Abottabad to find & kill Osama bin Laden -- that data was in the open hours before any news organization reported it.  News organizations can integrate the wisdom of the crowd into the newsroom like never before.
• Investors in a particular market or equity can find out about supply disruptions or can mine social networks for information on how employees of a company feel about business prospects.  They similarly can use the global feed or parts of it to monitor sentiment
• Companies in a competitive market can mine social networks for information on customers, leads, and people with purchase intent.  They can identify specific targets and understand their likes/dislikes.  They can also map influencers of that person, people that person influences, and more or less what makes them tick.

But despite all of the possibilities and all the advances in self-publishing and the Internet, collectively we have not gotten better at getting smarter, faster.  The news organizations, investors, and leading companies of the next decade will be people who learn how to mine real-time data -- both what is being said, by whom, and by the additional context that qualifies just how important the information is.

Launching Lasso v3 and what is social commerce

We're busy hatching version 3 of Lasso, which brings us squarely into the fray of social commerce. The first customer has gone live and several others are following suit shortly.  I'll share these examples when they go live throughout March 2011.

So what is social commerce exactly?

We think of social commerce as the broad requirement that marketers will increasingly face in 2011 and beyond to begin to make money directly from the relationships that consumers have with one another.  That can take place on Facebook, Twitter, e-mail, mobile devices, other social networks, and web properties.

The best social commerce product and solutions providers will have technology and business processes that make these things happen without annoying consumers.

Groupon and group purchasing companies have dominated the landscape of social commerce thus far.  We have a group purchasing offering in Lasso v3.  But we're also (and perhaps more) interested in what comes after group purchasing.  Are there other ways that groups will form and make collective buying decisions?  How can technology help businesses earn more revenue and profit from groups they have either created or fostered over the years?  And what can be done for larger organizations that have earned large audiences over the years -- how can they be empowered to succeed?

These are some of the questions we are answering with Lasso v3.

Lessons Learned from the SMB "segment"

Having worked in the SMB segment with a variety of newspaper partners over the last six months or so, I thought I'd share some thoughts on what we've learned from the small & medium business "segment".  I use air quotes for the "segment" because it is more like a catchall... a bargain bin at the grocery store where you're as likely to find onion powder as an overstock of mango chutney.

Lesson #1 - small and medium sized businesses really are not a "segment" but rather share the economic commonality of being more or less owner operated.

Many of these small businesses are successful outside of the context of the Internet.  The business owner opens a retail store on the right corner.  A restaurant has the best salsa in town.  A plumber is on call all day, every day, and has a great reputation for providing excellent service even on holidays.

Lesson #2 - Internet marketing makes a lot of sense for small and medium businesses, but it isn't what built many surviving businesses.  So it is a "nice to have" and not a "must have" for many established SMBs.

New businesses have a lot to gain by using social media and internet marketing as promotional vehicles.  There's a reason mobile food trucks use Twitter aggressively.  New businesses get a ton of response from things like Groupon.  Awareness is the sweet spot for SMB internet marketing and social media today because the business owners are motivated.

Lesson #3 - Motivation matters, and it's a lot easier to sell an immediately effective solution to a needy customer.

Finally, simplicity and ease of use matter.  For many SMB owner/managers, the ease of use bar is extremely high and probably beyond what most software people should expect.  This brings me to an interesting point -- it is almost impossible to market "software" to local businesses.  If you ask a SMB owner/manager what they want, odds are they won't tell you that they want "software".

As such, our business continues to evolve... smarter and more effective than ever.

 

Forbes article on local business marketing going social

Howdy everyone - today Forbes published a summary of my thoughts on local business marketing. Paraphrasing, I really do believe that local businesses are being forced to develop a core competency in internet marketing across major channels -- e-mail, social media, search, etc.

The full article can be found here:  http://www.forbes.com/2010/09/17/facebook-small-business-technology-marketing.html

Companies that get it are killing it, and those that don't will suffer.

Have a great day everyone.

5 Ways Facebook Places Changes the LBS Game

I think just about everyone in the local advertising halo is digesting Facebook's announcement that they are jumping into LBS with two feet.  The LBS folks knew this was coming, yet the proposed "co-opetition" still scares the hell out of them.  In fact, I brought up this very point at a panel in May with Josh Williams of Gowalla.  The entrance of a major player with a HUGE audience is a massive gamechanger for the startups that popularized things like check-ins, mayorships, location-driven game mechanics, etc.

If rival tech giants such as Google, Yahoo, AOL, Microsoft, and Apple haven't considered Facebook a competitor yet, they're probably now realizing that, yes indeed, Facebook is perfectly willing and able to compete in the local advertising arena and they're a major, major threat.

Overall this is obviously a really big deal and a seismic shift in the LBS business, in local advertising, and perhaps in social networking in general -- although it will take several years to play out.

In May, I shared some thoughts about LBS on Mashable and followed up here on my blog.  I thought I'd spend a few minutes today talking about what I think the latest news means for the sector:

1) LBS startups forced into building an ecosystem like never before -- I have written before about how LBS startups have been riding the wave of popularity & innovation but have also to some degree tried to control how third-parties interact with their systems.  For instance, even today only foursquare allows write access to their API.  LBS startups are not by any means dead -- in some circumstances they will remain the "consumer front end" for LBS.  But to stay relevant, they will need to be a lot more aggressive fast about building an ecosystem that helps justify themselves long-term.

2) Legitimacy to LBS -- LBS startups have done a great job of exciting the early adopter market and showing the world the possibilities of local, mobile services.  But none have yet made it to the mainstream.  Why?  Because it is a HUGE undertaking.  Reaching moms in Kansas is just tough.  Facebook changes all of this significantly because they have such a huge audience.  150 million+ people are on Facebook Mobile and over 500 million experience Facebook on the Web.  Now those are mainstream audiences.

However, I do think that this is a situation where the "rising tide raises all boats."  This will legitimize the existing LBS startup players as well.  In fact, I think in the short term foursquare, Gowalla, MyTown, and others will experience growth.  The bigger question, of course, is the long-term impact for the LBS startups.

3) Facebook, the aggregator -- With this move, Facebook aims to be the center of all location-based activity.  The existing players are presently invited to "read" data from the Facebook Places API but will also be allowed to write data to Facebook.  What a great way for Facebook to build a robust database off the backs of the startups that popularized the sector.  I think the golden rule needs to be changed from "he who has the gold rules" to "he who has the users rules."

4) Twitter, the afterthought -- Twitter just gets a little more marginalized each day.

5) The Cold War begins in earnest -- There is absolutely NO WAY that this move will go unchecked by Google, Apple, Yahoo, AOL, and other major players who are eyeing the location sector.  To some degree, this move really forces relatively quick action by these companies who will need to do something to be relevant.  Otherwise, Facebook will own it.  I suppose you can argue that Facebook is already well on its way -- they have the audience, they are about to have a ton of data, and they've delivered an immersive experience to users so far.

We live in interesting times, that's for sure.

The Travelling Road Show

The job of a CEO is never easy -- but it's been particularly challenging over the last few weeks.  Travel has picked up significantly as we get more and more traction.  Our core business -- helping local newspapers and new media sell relevant advertising systems to small and medium businesses -- is booming.  We've had a few soft launches this summer with more in the works right now.

Overall I think that many local media companies and newspapers are beginning to realize that the SMB segment is indeed a moneymaker.  It just requires a few things to work well:  product, price, value for the consumer & local business owner, and probably most importantly -- sales team engagement & readiness.  In that sense, our engagements with local media have been a TRUE partnership -- requiring and depending on both us and the partner to execute.

Anyway, I've had a few customer/partner visits and a lot of engagement with local business owners around the country over the last month or two.  I won't use this forum to share all the feedback from them, but I can tell you that the advances of the last few years (self-serve, social media, group purchasing, etc.) have really empowered business owners.  I don't get the "fear, uncertainty, and doubt" I got when we first started talking to local businesses back in 2004!

Blog update

Howdy everyone - just a quick note to let you know that I am making a subtle change to this blog.  I am moving all posts on entrepreneurship and social media over to a new blog at Wordpress -- http://riskjunkie.wordpress.com.

This blog will focus on our work with Lasso and with local media companies.  As business picks up significantly, I thought it was appropriate and a good time to make this change to the blog.

Busy Week - Lasso progress, Facebook book release, speaking at Rice Alliance event

Interesting times in the land of Lasso.

We go live with one customer this week although you won't get to see it for another few weeks.  We start onboarding two other customers this week, and we have a third call about a new application of our product that is very, very exciting.  The game is proximity marketing, the applications are tremendous, and the opportunity is significant.  We are the infrastructure that makes it all sing and that infrastructure just keeps getting better & more capable every day.

Add to this two other events more on the social side.  My book, Facebook Marketing An Hour a Day, is formally releasing tomorrow although it has been available on Amazon for awhile.  In fact, the book has been in/around the Top 10 in the Web Marketing and e-Commerce categories so far & has been doing very well on the Marketing list as well.  So far so good.

The "virtual launch" of the book is taking place tomorrow.  My co-author, Mari Smith, and I will be on camera (technology hiccups notwithstanding hopefully) to talk about the book, Facebook, and a variety of other things.  I would love you to join us.  A quick note re: Mari -- she is amazing at mobilizing people & preaching the good word!  We are sortof polar opposites when it comes to all of this.  She's the extrovert, I'm the introvert.  She has really done a great job becoming a face of social media.  I'm less worried about all of that than I am our startup work.  The collaboration worked really well on the book, and I hope it is the beginning of even more.  We'll talk about all of this among other things tomorrow at the virtual launch.

Finally, I'm on a Rice Alliance panel re: monetizing location services on May 5th at the AT&T Conference Center at McCombs.  Joining me will be Josh Williams (Gowalla), Blair Garrou (DFJ Mercury), and Rick Orr (TabbedOut).  It should be fun -- I had coffee with an organizer Friday who told me that the event is very popular.  It's like I tell people all the time -- we're VERY early in the location services game!

When it rains, it pours I guess.  Not a bad thing.  Have a great week everyone.