Wednesday, April 30, 2008

Another pitch for text analytics gone awry

This recent Marketing Profs article was penned by David Bean, Ph.D. - the founder of Attensity, one of the largest text-analytics companies around.

I think it, again, misses the mark. And, again, this is not in any way a criticism of David, his company or text analytic tools in general (I really like these tools). It's a criticism of how they are currently getting pitched.

A good portion of his article argues against traditional research methods in favor of harvesting unstructured conversational data from consumers and customers. There are two major problems with the assumptions behind this argument.

Firstly, traditional research methods, by and large, are not broken. David refers to traditional research methods as struggling to 'make sense of it all'. As if they are somehow unfocused. Yes, research practitioners come across unfocused briefs, but they are not the norm. The norm is to have a clear objective. Most research gets commissioned when there are some specific issues afoot. A lot of this research solves these issues effectively. And it does it without asking consumers questions like 'So what do you think would make this better?' - which, in most situations, doesn't get you any good answers.

Yes there are bad examples of questionnaires and focus groups. But this is usually the practitioners fault, not the methodology (if you're having a hard time finding a good research firm, drop me a line, I can point you in the right direction).

The irony in David's article is that after a page of argument against using structured research to solve issues, he pulls out a quote from a structured research study to prove his point! (470 responses from is not the best source to understand the 'trust in advertising' issue).

Second, there is an assumption that unstructured data is more useful to understand everything from new product ideas, effectiveness of marketing campaigns, product positioning, etc. This is a tall order. People will write in to companies with emotionally laden stories of how they were helped/liked/loved/made to feel good, or the opposite. But they rarely talk about how the brand 'needs to be slightly more edgy to really make me like you'; 'I loved your ads but you need to change the color tones to more suit your brand's style; or 'here's a product idea for you...'. Fanciful stuff.

The myriad of stories you receive from customers need a solid layer of interpretation before they become useful. This typically involves structured research.

The gist of my argument is don't try and create a cure for a disease that doesn't exist. Text analytics is a great augment for your research and intelligence gathering efforts, not a replacement for them. I know there is a need to go after an internal budget when selling in a solution like this. And there is pressure to justify the cost. But this argument will be a tough sell.

A good text analytics tool is like a radio. Without a radio, you can't tune into a radio channel. You just get a bunch of meaningless static. Meaningless static is what most companies hear when they try and listen to consumers or customers. A text analytics tool gets you access to the channels you need to listen to. From there, you can decide what you need to know in more depth.

The problem with a radio is that it is one-way communication. You can't direct the conversation. This is a limitation of the medium. It's not a selling point.

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Sunday, April 27, 2008

Agile Marketing

I am doing some work at the moment for a client who is trying to measure innovation inside their company.

Depending on your type of company, this can be easy or hard. And there are a lot of resources available to help - most notably this government report commissioned last year to look at innovation in the US economy (I link to it only because it was written by of a bunch of CEO's and business leaders, not just academics, which means it has a nice practical focus).

A recent post by Gareth over at Brand New also got me thinking about innovation in Marketing. He talks about an 'option investor' approach - you dabble in a range of different activities and see what gains traction. The activity range is like your innovation sand-box. And in Marketing this can contain a lot of toys - new media, old media, social media, digital whatever. Innovation comes from trying/testing a range of things rather than just thinking and planning the 'one big thing'.

This kind of idea also matches closely with a theme in technology startups - where many people advise you to build, test, re-build, test, rebuild, etc. A very trial-and-use focused way to develop. It actually has a name - Agile Development.

So what about Agile Marketing - a very innovation, test and trial Marketing effort rather than thinking and planning one big thing? Makes sense.

Looks like I am not the first person to coin the phrase. Back in 2006 Matt Blumberg, CEO of ReturnPath actually blogged about the exact same idea - again borrowing from the software development world.

I think it's a really interesting way to think about Marketing in today's world. Throw away the 100 page plan and just concentrate on executing in phases that have clear goals and at least some way of measuring success. The key is keeping goals manageable and constantly tweaking your approach.

And don't be afraid to just try things! I always cringe when I see my ex employers web-site - it still has a reference to Netscape Navigator and IE4 on the splash page. It doesn't take 2 years to change a website!

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Thursday, April 24, 2008

Size matters...

I got an email the other day from the MarketingProfs people saying research has shown that the size (denomination) of bills consumers carry affects their willingness to spend those bills.

Apparently, if we have a larger bill in our wallet, say $100, we're less likely to break it to buy a $10 item than we are to fork over $10 or two $5s. Carrying around large bills therefore affects consumer spending - effectively lowering it if bill denominations are high.

I haven't read the whole article, just the summary. But this makes sense to a point. Human beings are bad at valuing things. It's understandable that we think a $100 bill is more 'valuable' than five $20s - it's rarer for one thing, and rarer generally means 'worth more'.

However, it's also easier to carry around and harder to change - so there is a convenience factor in there as well.

The summary claims that banks can somehow affect consumer spending by giving out smaller bills. I think this is a bit far fetched. Again, I haven't read the article, but from what I know about consumer behavior I would argue that the relationship between 'perceived value' and actual value of different bill denominations goes something like:

You might be able to give the $50 a 'perceived value' score higher than the $20 (rather than the same value), but not by much. And as most banks shell out $20s at ATMs, I can't see moving to $10 or $5 having any affect whatsoever.

Ok, so this is, again, me not reading the article. I'll now go and try and find it to see if I even came close to guess the right relationship.

Ugh, it's in the Journal of Consumer Research - the greatest collection of practically useless information known to man.

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Thursday, April 17, 2008

Text Analytics Revisited

A week ago I posted about the Attensity text analytics tool that one of my clients was looking to purchase. The post garnered a bit of interest. Most notably, Sid Banerjee of Clarabridge (a competing product) left a long and well thought out post on how he saw the market unfolding and how his company was positioned in it.

I wanted to do a follow-up post as I still think there are some issues with the way these text analytics tools promote themselves. This is not at all a commentary on their value to an organization - I think they are extremely valuable - it's more a comment on where I think the sweet-spot is in promotion of the idea.

My comments...

  • Don't be a tool. Anyone can claim to make a great hammer, but few people wield it expertly. You have to concentrate on selling solutions - which means knowing what the problems and issues are.
  • Don't be vague about what it is you do. Be careful in the promotion of any slogan with 'insight', 'actionable insight', 'transform', intelligence', 'actionable intelligence', etc. You get the idea. These are meaningless at the coal face. Be proud (and promote) real problems client's have solved using your tool. This gives prospective clients a far better idea of how it might apply to them.
  • Don't try and re-write the rules of marketing and branding. Yes these tools can be good, but they are not substitutes for traditional research methods. Believe me, you're going to come off looking like idiots if you get into a debate over the merits of text-analytics versus customer qualitative research. There is a whole different spectrum where text-analytics is useful, and it doesn't dovetail with traditional research as much as you think.
  • Sell as high up as you can. While these products are probably understood best by analysts, you want to sell them to CEOs. Any intelligent CEO is going to do a quick back-of-the envelope equation on the number of feedback points they have, the huge amount of information from these points, and the time and man-power to process it (or the opportunity cost of not-processing it) and realize the tool is worth it. Then tell them to factor 5 year growth in information received and they might just write you a check on the spot.
  • Don't use a technology story. No one cares. Gartner analysts might. But they are just strange. Marketers in particular don't care about technology - at least not in a geekish way.
  • Under sell. Text analytic tools are very powerful for certain problems. At some point, people 'get it'. They see what it can do and their eyes light up. Under-selling it lets them add enthusiasm. You want them to be enthusiastic, not you.
These points are of course based on my limited experience of seeing text-analytics sales presentations. So digest them with that in mind. But I do think they are all valid.

Like Sid pointed out, I think this whole area is really exciting and well timed given the huge amount of information flooding into companies these days. Sorting through this information is no small task.

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Friday, April 11, 2008

I've seen the future of digital and it's.... old

I have been waiting for the ultimate digital experience for a while and I think I finally found it -

They have been live streaming the Masters for a few years now, but the experience they have delivered this year in terms of slickness and quality viewing experience is amazing.

Check it out if you are into golf.

If not, ignore this blog post :)

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Monday, April 7, 2008

Back from Blogger Social '08!

It's been a full on couple of days around here. Mostly due to the great event that was Blogger Social '08!

A huge thanks to CK and team who managed to pull this thing together and actually make it into a wonderful couple of days.

I pretty much knew no one going into this thing, and came out of it with a lot of new friends and a huge heaping of respect for bloggers in general - a really interesting and smart (in a good way) group. Some of the people I met...

...on Friday night I had the privilege of meeting Valeria for the first time. Valeria runs the Conversation Agent blog - aptly named because the first thing we did after meeting was sit down and talk for 2 hours (yes, Valeria can talk!). I also had a brief chance to talk to Seni Thomas (really smart guy who seemed to have a ton of work/life experiences in such a short span of time) and Marshall Sponder of fame (Marshall is also an artist and has the coolest 'personal branding' card I've seen in a while).

We met up at the new MoMA building on 53rd to hang out before the open bar on 45th (a museum tour within walking distance of free booze was a great way to start the weekend!). And while I never got to chat with them much, I also met Nathan Snell and Ryan Karpeles. We briefly gave Nathan a hard time over his blog's name - The Technopian. All fun-and-games though - what's in a name anyway Nathan? The more I say it the more it grows on me as well - The Technopian, The Technopian, Technopian...

I was introduced to so many people over the weekend, its hard to remember all the conversations, so forgive me if I miss one.

At the pub after the museum I met Chris Kieff - who later the next day 'cookied' all the bloggers (pictures here). I also had an all too brief conversation with John Wall - who runs the M Show Marketing podcast (which I am about to subscribe to). Gavin Heaton was one of the three(?) antipodeans at the event. Gavin flew all the way from Sydney for the weekend - now that is dedication to the cause! Gavin writes the ServantofChaos blog - one that I have been following for quite a while. It's always a great read. Check it out.

At some point in the night I got cornered into a corner with Anna Farmery and Heather Gorringe - two Brits. Standing in the corner of a pub with two English girls would normally have me searching for excuses to bolt for the door (I jest!). But not these two. Two of the nicest people I've met. Heather runs a popular farming podcast in the UK - Wiggly Wigglers. While Anna runs the Engaging Brand blog and is one of those really smart people you can have a conversation about anything with - I think we covered topics from consumer apathy on environmental issues, to choices in the face of imminent extinction. How did we get on to that?

Later in the night I got to meet Paul McEnany of heehawMarketing -another blog I have been following for a while - Paul's a great writer. Always has a clear idea and lets his personality really come through in what he writes - it's honest stuff. Briefly got to talk to the other antipodean, Katie Chatfield - still supports the All Blacks despite the Australian accent - good to see. Also got to talk to Mike Arauz - whose blog I didn't have in my reader but now do. Had a great wide ranging, far reaching and interesting conversation with Marilyn Pratt that continued the next day. Marilyn is a community evangelist at SAP. Having started our business in the Microsoft program, it was interesting to briefly hear how another company manages a developer network.

One of the highlights was bumping into Saul Colt - the Marketing guy for FreshBooks. I use Freshbooks for my consulting and just love it. It's one of those brands that just has the marketing built in. A lot of that is Saul's doing. He is, after all, The Smartest Man in the World! Saul hit me up for a 'user profile' spot that I am going to take him up on. I love to talk about products and services I like - it's almost a duty these days.

On the Saturday afternoon we all went on a boat ride around Manhattan. CK donned a 'liberty crown' and ended up looking a lot like the statue - 'statuesque' describes her pretty well. 'Larger than life' would also fit.

On the boat I had a chance to talk with Mario Vellandi and Jennifer Berk - Jennifer's blog is Information Squid... because she just likes squids. We got into a conversation about the various merits of octopuses and starfish, but squid just seemed to come out on top every time. I also had a good talk with Rohit Bhargava and got a chance to skim read his just released book Personality Not Included. Off to Amazon to get it right now. I get a good feel for a book just skimming the pages, and this one looks to be great. A must read if you are any way involved with branding or Marketing.

Again, you have to give credit to CK and team who pulled this off. It really was a 'social' - just a bunch of people with similar interests and passions getting together and hanging out. I couldn't make the Saturday night event, but I am sure it was also a huge success.

One last thought. On the boat we were asked (as part of a video documentary of the weekend) to say a few words about Tibet. Next to us on the pier were Tibetans protesting over the recent Chinese crackdown. On the spur of the moment I think managed to blurt out something nonsensical. What I meant to say was...

... I'm not a person who throws around hope in humanity lightly - we don't have a great track record. But if this 'social' and the community around it is any indication of the future of communication, governments who rely on the suppression of expression, of ideas or dissent will not last long. The wider we make the conversation, the more inclusive and less restrictive, the more honest and powerful it becomes. That has to give hope to displaced and suffering people everywhere.

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Wednesday, April 2, 2008

Thinking about measuring customers

I had an opportunity yesterday to have a talk to some people about the setting measurable goals and KPIs (Key Performance Indicators) for their business.

I spent a lot of time thinking about how to describe 'measurement'. Which on the surface seems quite straightforward - you think about a business process, think about the areas of that process that are critical to it working, and measure them as best you can.

And with many processes it is this straightforward - the defects in widgets coming off a production line is an easy to understand measure of manufacturing efficiency.

When dealing with processes that affect the customer (or potential customer), it gets more murky. The idea of a 'measurement' that accurately reflects the success of a process is harder to define.

You can measure if someone is satisfied with your level of service - but they still get pulled away by a lower price. You can measure if someone likes the comfort of the interior of your newest car model - but they buy the one with more cup-holders. You can measure the softness of pillows in your hotel - but it's the complicated alarm clocks that cause more concern.

I just made these examples up (well, mostly). The point being that you're not measuring widget quality - it's not CLEAR what success really is. You can have a go at defining it, but there are things you might miss.

There is no real way around this. It's an uncertainty inherent in the process of measuring a customer or consumer. However, despite this uncertainty I find that a lot of people still approach measuring the customer/consumer as IF they are measuring widgets - that there is one, universally accepted idea of success and that is what they will pin their hat on.

In reality, these (widget measurement and customer measurement) are two different types of 'thinking' about knowledge (and I am borrowing from Donald Rumsfeld here).

Widget measurement deal with things you 'know you know' - you understand exactly, to the minutest detail, everything that has been done to that widget. Customer measurement deals with both 'know unknowns' and 'unknown unknowns'. The former being everything you think might be important (such as measuring cup holder satisfaction) but don't measure. The latter being everything else in the given universe that might affect the outcome of the process in your customer's mind, but you have no current knowledge about it and couldn't even guess as to what it might be.

These two types of knowledge affect the way you manage the process. Customers aren't widgets - which most people understand. And the knowledge you have about them is not the same TYPE of knowledge you have about the widgets - fewer people understand this.

I'm not going to wax philosophical about this for too long as I'll probably put a few readers to sleep. It's more the beginnings of some thinking I have been doing around 'knowledge of customer knowledge' - a topic that isn't really addressed by anyone.

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