Big Data: It’s a people issue now

I had been considering a New Year’s resolution to stop using the term “Big Data” (it’s overused to the point where it’s sometimes hard to remember what it actually is) but not quite yet. Chalk it up to that list of deferred new year’s resolutions. I’m pulling in Big Data again because I really liked what my colleague, Matt Ariker, recently said about it as part of our series, Marketing Outlook 2013.

While all that data can lead to real and significant growth, nothing happens with it unless you can use it. And you can’t use it effectively, or squeeze as much growth (or profits or productivity) from it if you’re not organized to handle the data and insights. Matt’s piece – Big Data: It’s time to stand and deliver in 2013 – focuses on how Big Data in 2013 is going to shift from being a data issue to being an organizational one.

And that’s true as well in so many important areas where companies need to focus, from how to market to customers to how to get more ROI from marketing. Customers come at you in so many different ways – touchpoints, technologies, venues, channels, times – that it’s impossible to market or sell to them effectively unless your company is organized around the customer, as opposed to around a product or business unit or location. The CMO role itself, in fact, is going to have to undergo an organizational change in terms what CMOs need to be responsible for beyond the bounds of traditional marketing.

Are you ready to make the necessary changes in 2013?

I hope I’m more successful keeping my other New Year’s resolutions

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Three resolutions for social media success in 2013

By now, many of you have probably decided on what resolutions to hold yourself to in the new year. Personally, as I recently told Fast Company, one of my New Year’s resolutions is to visit non-technology comapanies to learn and get inspiration from other industries and organizations. From the beginning of Hearsay Social, my co-founder Steve and I have honed a culture and work ethic based on our experiences at tech companies like Google, Microsoft, and Salesforce.com. By incorporating lessons from non-tech companies, I hope to continue to improve our culture and the way we do business.

But what about social salespeople and marketers? Here are a few “social media resolutions” my team and I came up with to help you be successful in the new year:

  1. Close more deals with social signals
    The cold call is dead. Said another way, salespeople value social context: insurance agents sell more lines of coverage when their contacts have babies, financial advisors increase assets under management when clients change jobs, and real estate professionals sell more homes when their contacts move. Social networking sites provide easy access to a wealth of social context, providing your people with the right information to sell more effectively.

    In 2013, resolve to use social signals to build and deepen your relationships with current customers and to discover new leads and prospects.
  2. Measure the ROI of your social initiatives
    There is a reason why marketing and sales teams have dramatically increased the amount of time and money they put into social media each year. It pays off. Take James Peregrino, one of Farmers Insurance’s best agents, for example: “62% of my business my first year came from Facebook.”

    It’s likely that your company’s social media efforts are already driving business, but are you measuring it? The better you can track ROI, the more effective you can make your social media program and the easier it will be to iterate.
  3. Be your company’s social media superhero
    Nearly 7 in 10 Fortune 500 companies have a corporate Facebook page, and more than that have active Twitter accounts. Dive in! If you were just testing the waters in 2012, it’s time to commit. Build out a consistent content calendar, brainstorm on branding, and never let your social media assets get stale. Experiment with new techniques because there are few cut and dried solutions when it comes to social strategy. You must carve your own path.

    Resolve to take productive social media risks this year, like posting at unconventional times or testing out newly launched networks.

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iPad Becomes Advertisers’ Best Friend

Advertisers favor showing up on iPads over any other device, and they’re willing to pay for it. Sky-high click through rates on iPad have helped it surpass the iPhone in popularity amongst advertisers despite competition making iPad placements the most pricey. The data from mobile ad platform MoPub’s Q4 2013 study of 90 billion ad views shows advertisers are betting on the biggest little screen.
Elain Szu, Director of Product Marketing for MoPub explains why the ad industry is warming up to the iPad. “Advertisers see the tablet and its [larger screen size] as nearly the same as the desktop.” Essentially, advertisers can easily translate their strategies to tablets. They don’t have to completely rethink their creative designs because the space they have isn’t all that different than on a laptop. Much smaller smartphone screens are much more different and require a new game plan.
Click Through Rates Mobile Ads Done
MoPub’s data shows how iPad is the darling advertisers. First and foremost, iPad ads seesthe highest CTR (click through rates). Over the holidays, the iPad saw a 1.7% CTR from December 1-15, and a 2.2% CTR from January 1-7. Meanwhile, the iPhone had just 1.2% CTR at the beginning of CTR moving up to only 1.5% at the start of the news year, and Android smartphones saw just 1.0% and 1.1% CTRs in those time periods.
The MoPub’s popularity index measures how many bids it sees per ad slot, and it shows advertisers are chasing those high iPad CTRs. Apple’s tablet was at the top of the pile for the first time in Q4 with a score of 5.3, up from 2.8 at the end of Q3, blowing past the iPhone which only increased to 5.0 from 3.5 in Q3.
The rush to win bids for limited iPad inventory due to its lower install base than smartphones has driven up the cost of ads there, though that hasn’t deterred advertisers. iPad eCPMs (effective cost per thousand impressions) increased 48% over Q4 from $0.94 to $1.40. For comparison, iPhone eCPMs went from $0.62 to $1.04 in that time period, followed by Android tablet eCPMs increasing from $0.59 to $0.99 over the holidays. Android smartphones are in last place, starting at a lowly $0.52 eCPM and growing to $0.80 by the start of January. Obviously these were impacted by the holidays, but their relative sizes shows the strength of the iPad.
MoPub eCPM Graph
Apple is winning the overall mobile OS popularity contest amongst both advertisers and users. iOS has both higher click through rates and eCPMs than Android overall.
MoPub CEO Jim Payne tells me that’s because Android users don’t have as high of a life-time value to advertisers who capture them. Payne tells me “It’s because the Android user is much less monetizable in terms of virtual goods, so the advertisers aren’t willing to pay nearly as much for them.”
As for my take on why advertisers want to move into iPad real-estate? I think it comes down to the tablet behavior pattern. While we surely use our phones while laying in bed or stuck in transit, most of the time we’re bustling through the real world trying to get information to accomplish the task at hand. We’re focused, and less likely to take a detour to click on an ad.
While using an iPad, we’re more often relaxed, at rest, or in a mood to discover something. That means we’re more likely to chase an appealing discount, new product, or fun game down the ad click rabbit hole. Advertisers want to court us when we’re receptive to their advances. When we pick up the iPad, we let down our guard.

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Facebook's Graph Search takes on Yelp, LinkedIn, and, yes, Google

Facebook CEO Mark Zuckerberg unveiled a new search feature that's designed to entice people to spend more time on his company's website and will put the world's largest online social network more squarely in competition with Google and other rivals such as Yelp and LinkedIn.
Called "graph search," the new service unveiled Tuesday lets users quickly sift through their social connections for information about people, interests, photos and places. It'll help users who, for instance, want to scroll through all the photos their friends have taken in Paris or search for the favorite TV shows of all their friends who happen to be doctors.
Although Zuckerberg stressed that "graph search" is different from an all-purpose search engine, the expanded feature escalates an already fierce duel between Google Inc. and Facebook Inc. as they grapple for the attention of Web surfers and revenue from online advertisers.
"This could be another reason not to use Google and another reason to stay on Facebook for longer periods," said Gartner analyst Brian Blau. "I don't think Google is going to lose its search business, but it could have an impact on Google by changing the nature of search in the future."
Facebook's foray into search marks one of its boldest steps since its initial public offering of stock flopped eight months ago amid concerns about the company's ability to produce the same kind of robust earnings growth that Google delivered after it went public in 2004.
Although Facebook's stock has rallied in recent weeks, the shares remain below their IPO price of $38. Investors seemed let down by Tuesday's news, causing Facebook's stock to slip 85 cents, or 2.7 percent, to close at $30.10. Google's stock gained $1.68 to close at $724.93.
If the new search tool works the way Facebook envisions, users should be able to find information they want to see on their own instead of relying on the social network's formulas to pick which posts and pictures to display in their fees, analysts said.
Until now, Facebook users were unable to search for friends who live in a certain town or like a particular movie. With the new feature, people can search for friends who, say, live in Boston who also like "Zero Dark Thirty." And Facebook's users will be able to enter search terms the same way that they talk, relying on natural language instead of a few stilted keywords to telegraph their meaning.
Only a fraction of Facebook's more than 1 billion users will have access to the new search tool beginning Tuesday because the company plans to gradually roll it out during the next year to allow time for more fine tuning.
Not all the interests that people share on Facebook will be immediately indexed in the search engine either, although the plan is to eventually unlock all the information in the network while honoring each user's privacy settings.
That means users can only see content that's available to them through other's privacy settings, Zuckerberg pledged.
"Every piece of content has its own audience," Zuckerberg said.
Though the company has focused on refining its mobile product for much of last year, the search feature will only be available on Facebook's website for now, and only in English.
Facebook's decision to make its foray into search slowly reflects the formidable challenge that it's trying to tackle. The "social graph," as Facebook calls the trove of connections between people and things, is "big and changing," Zuckerberg said. There are 240 billion photos on Facebook and 1 trillion connections.
Indexing all this, he added, is a difficult technical problem the company has been working on.
Although Facebook isn't trying to fetch information across the Web like Google does, it's clearly trying to divert traffic and ad spending from its rival. Facebook is hoping to do this by making it easier for its users to quickly find many of the things that are most important to them: movie, music and restaurant recommendations from friends and family; photo galleries of people they care about; and new connections to old friends and other people with common interests.
It's the kind of personal data that has been difficult for Google to collect, partly because Facebook has walled off its social network from its rival's search engine. Instead, Facebook has partnered with Microsoft Corp. to use its Bing search engine to power traditional Web searches done through its site. That partnership remains.
"For a certain set of searches, this is going to be far more powerful than Google," predicted Ovum analyst Jan Dawson.
Yelp Inc.'s online business review service also could be hurt if Facebook's search feature makes it easier for people to find recommendations from the people that they trust instead of relying on the opinions of strangers posting on Yelp. Facebook's search tool also will allow people to find people who worked at a specific company - one of the advantages of LinkedIn Corp.'s online service for professional networking.
Yelp's stock fell $1.36, or 6.2 percent, to close Tuesday at $20.61 while LinkedIn's stock added 39 cents to finish at $117.91.
Facebook doesn't have plans to show additional ads as people use the new search tool, but analysts said that is bound to change. "If the appropriate privacy protections are in place, this could be a significant boost in value that Facebook can provide to its users and, in time, that will provide some really valuable new advertising avenues for advertisers," Dawson said.
Google is trying to overcome its social network disadvantage with Google Plus, a service that the company launched 19 months ago in attempt to glean more insights into people's relationships and counter the threat posed by Facebook.
Helped by Google's aggressive promotion of the service, Plus boasts more than 135 million people who post information and photos on their profiles. But Google Plus users still aren't sharing as much or hanging out on its service as long as Facebook users do, raising questions about whether Google will ever be able to grasp the Internet's social sphere as firmly as Facebook does.
Facebook now must prove it can master the intricacies of search and picking the right ads to show to the right people at the right time - complicated tasks that Google has honed during the past 14 years to establish itself as the Internet's most powerful company. It currently produces 10 times more annual revenue than Facebook. Though neither company has released its 2012 financial results, analysts are projecting $52 billion in 2012 revenue for Google versus about $5 billion for Facebook.
The search tool is laying the foundation for Facebook to close the gap, said Chris Winfield, co-founder and chief marketing officer for online ad agency BlueGlass Interactive.
"They can just chip away incrementally," Winfield said. "The can start by just taking away one in every 100 Google searches, then one in every 20, then one in every 10."
In an opinion apparently shared by many investors, Forrester Research analyst Nate Elliott doubts the search feature will prove to be a boon to Facebook. He views it as little more of a way for Facebook users to find new friends online more quickly and make new connections that ensure the social network remains relevant.
"It's vitally important, but it's also unsexy," Elliott said. "If Facebook thinks people are going to start searching Facebook when they would have searched Google, then they I think they are going to wake up in a year and find they are sorely mistaken."

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MOBILE USAGE: How Consumers Are Using Their Phones, And What It Means

Mobile is no longer a communications utility, but a media distribution hub. According to eMarketer, mobile now accounts for 12 percent of Americans' media consumption time, triple its share in 2009.
Where is this consumer attention being focused?

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The biggest beneficiaries have been mobile apps. Time spent on apps dwarfs time spent on the mobile Web, and smartphone owners now spend 127 minutes per day in mobile apps.
In a new report from BI Intelligence, we analyze the main mobile usage trends developers and publishers should consider to be successful in mobile, detail how users are consuming content on their mobile devices, take a look at the most popular mobile activities, and examine how mobile usage is an additive activity.


Here's an overview of the four usage trends developers and publishers should consider: 

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90 Percent Of Passwords ‘Vulnerable To Hacking’

Even passwords that are considered strong are vulnerable because users can't remember them, new research says.
Global consultancy Deloitte claimed that over 90 percent of user-generated passwords, even those considered strong by IT departments, will be vulnerable to hacking in 2013.
Jolyon Barker, global lead for Deloitte's technology, media and telecommunications industry, said “Whilst moving to stronger, longer passwords means greater levels of security, people understandably find these harder to remember.”
He added that so-called ‘two-factor authetication’, using additional methods, could improve security. “Instead an additional bit of identification can be used. It could be a password sent to a cell phone or smartphone, a physical device that plugs into a USB slot, or possibly be a biometric feature of the user,” Mr Barker said.
Deloitte said inadequate password protection may result in billions of dollars of losses, declining confidence in internet transactions and significant damage to the reputations of the companies compromised by attacks. As the value of the information protected by passwords continues to grow, attracting more hack attempts, high-value sites will likely require additional forms of authentication.
In June last year, however, a survey found that 'Password' topped the list of the 25 worst web passwords people commonly use to login into sites, leaving them more vulnerable.
The second most common password was ‘123456’, another easy code for hackers to guess when trying to access people’s email or Facebook accounts. Other passwords to make the list, generated by SplashData, an American password management data application, include: ‘abc123’, ‘iloveyou’ and ‘monkey’.
Facebook admitted that hackers are breaking into hundreds of thousands of Facebook accounts every day. Out of more than a billion logins to the website every 24 hours, 600,000 are impostors attempting to access users’ messages, photos and other personal information Facebook said. Last year 6.5million LinkedIn passwords were leaked online.
Deloitte also predicted that more than 80 per cent of internet traffic measured in bits will continue to come from traditional personal computers reflecting an age of PC plus, rather than a post PC era dominated by tablets such as the iPad. ”More than 70 per cent of the hours we spend on computing devices, including smartphones and tablets will be on a PC,” said Mr Barker.
The research further suggested that new gesture-based methods to control TVs will continue to lose out to the traditional remote control, while crowdfunding schemes such as KickStarter will continue to rise.

This App Schedules A Date Between Two People Who Know Nothing About Each Other

OkCupid is trying to make it even easier for people to find love.
Today, the dating company is launching a standalone app called Crazy Blind Date that sets up dates for single people.
To use it, all you have to do is sign up, create a basic profile, select places you'd like to meet, set which nights you're free, and upload a photo. Even though you upload your picture, your potential date will only see a scrambled version of that photo.
The goal is to help people find matches more efficiently by getting rid of OkCupid's standard back-and-forth messaging process.
“If you ask women what they dislike most about online dating, it’s that it’s too much work," OkCupid co-founder and CEO Sam Yagan told Jenna Wortham of The New York Times. “People want instant gratification. It’s the trajectory of the industry.”
An app like Crazy Blind Date is possible because of OkCupid's algorithm, Yagan mentioned at Business Insider's IGNITION conference back in November.
The app is available right now for iOS and Android. Check out some screenshots below.

Facebook Allows More Data Derived From Google Search Into Its New Ad Platform

Facebook has allowed a second company that targets ads using data derived from users of Google into its ad exchange. Search retargeting firm Simpli.fi announced that it had qualified to become a partner in Facebook Exchange, or FBX, the social network's real-time online bidding ad auction platform.
The first company to bring search data derived from Google users was Chango, which signed a similar deal to target Facebook users in December.
The pacts indicate that Facebook is intent on encroaching on an area that Google has long-dominated: using search intent to target online shoppers. Both Chango and Simpli.fi work by dropping tracking cookies on users' browsers as they surf the web.
If those users go shopping for cars, the cookie will track them. Once they log in to Facebook, they can now be targeted with car ads inside their Facebook accounts, via FBX.
Google was the king of shopping intent search for years because of the assumption that if you search for "Cadillac Escalade," you're likely looking to buy a Caddy. Google's search ad revenues are in the billions for this reason.
Facebook has had a disadvantage in this arena because no one uses Facebook to go shopping. Search retargeting firms in FBX, however, can now bring an aspect of that to Facebook.
Given that up to one of every five pageviews on the internet is generated by Facebook, that's a huge potential threat to Facebook.

iPhone Demand Remains Strong, Says ChangeWave Research

Finally some good news for Apple investors.
ChangeWave research has a new report out this afternoon that says demand for the iPhone is as strong as ever.
Recently, there's been a number of reports that iPhone demand was weakening. Those reports seem to be largely based on supply chain chatter that Apple cut orders for iPhone parts.
ChangeWave, which surveyed 4,061 consumers in North America, says 50% of people are going to buy an iPhone in the next 90 days. This is about in line with where Apple is after a big new iPhone launch, as you can see in the chart below.

aapl chart

If you want to be negative on this chart, you could say that iPhone interest is flattening, and even falling after a big new iPhone launch. But, it should be noted that the iPhone 5 peak was higher than the iPhone 4S peak.
If you really want to be negative, you could look at this chart, which shows interest in Samsung rising strongly, though still below Apple.

Aapl

And here's one more chart. Consumers love iOS more than anything else. Surprisingly, Windows Phone is more popular than Android:

mobil os

Small Steps to Analytics Maturity!

Recently a client asked me an interesting question: How would you start analytics in an organization?
This also seems to depend on the industry. While Banking has greater maturity in the use of Analytics, FMCG companies may have different challenges given the lack of end customer data. Also it takes time to build analytical maturity in a company. And it takes a certain unique mix of people- a combination of left & right brain talent! 
 Left & right brain
The question was interesting from many perspectives:
  1. What exactly is analytics and does the name describe the function?
  2. How should one go about starting doing the work that analysts are supposed to do?
  3. Where should the Analytics team report-is it part of a marketing team or somewhere else?
  4. What kind of issues should analytics try and solve?
  5. How much money needs to be invested to really make Analytics work?
My experience across both Retail & Retail banking has been that it is best to start small, very small! A lot of analytics can be done on an excel sheet and does not require a PhD in statistics to do. The simpler the analysis the “lesser” is the barrier in implementing the call for action that emanates from it. So my first suggestion to anyone starting out this kind of work is to follow the well know “KISS principle”(Keep it simple stupid). The most important next step from here is to choose the business area where you want to make an impact.
I would go for the counter intuitive bit here and try to make your analysis work for a business unit that is not doing so well. Businesses doing very well, have a lot of competing ideas clamouring for a share of the credit. It’s in the businesses that need help, that you will find maximum support. And finally I would say that choose business themes that are close to the CFO’s heart! The CFO’s support for analytics is probably the most critical part of what you would do-this forms the building blocks on which you can scale up your efforts in the years to come!
I have often come across situations where organization seem to believe that investing in top end statistical resources and buying high end technology is enough to extract value from analytics. The truth is vastly different and I strongly believe that embedding simple ideas and focussing far more on execution is critical for an organization to succeed in analytics based strategy.

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Moontoast Raises $5M For Premium Social Ads

Social advertising startup Moontoast just announced that it has raised $5 million in Series B funding.
CEO Blair Heavey told me that the company currently works with about 50 clients. It’s not an enormous list, but one that includes names like Universal, Lexus, Nike, Hyundai, Lady Antebellum, Time, and Simon & Schuster. Advertisers use Moontoast to create custom, interactive ads for social media — the ad types listed on the Moontoast site include a “social store,” surveys, sweepstakes, and a unit to offer free MP3s in exchange for email addresses.
Co-founder and CTO Marcus Whitney told me that the ads usually incorporate some form of rich media, but they aren’t just traditional ads repackaged for Facebook or Twitter.
“In the social advertising world, the actual creative is conversational,” Whitney said. “It’s much more marketing than standard, old world advertising. Our units are meant to really bring the conversation to life.”
The round was led by The Martin Companies and brings Moontoast’s total funding to around $14 million. Heavey said the funding should allow the startup to reach profitability.
In addition to announcing its Series B, Moontoast is also updating its platform today with what Whitney said is a new version of its analytics service incorporating data from the Facebook Ads API. He said the company plans to continue improving the analytics side of the platform throughout the year.
Moontoast was founded in Nashville, and even though half the team is now in Boston, Whitney said you can still see the Nashville influence in some ways — for example, in the fact that many of its initial clients were musicians.


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What Businesses Are Doing Wrong on Social Media (And 5 Tips For Success)

Over 1 billion people in the world are on Facebook, including over 175 million Americans, or 1 in 2 adults. Twitter recently surpassed 400 million accounts. LinkedIn boasts over 200 million users. Small business owners are trying to take advantage of these trends, but few are fully reaping the rewards.
For many business owners, the temptation is to use social networks to promote themselves and broadcast their messages. But if you stop thinking like a marketer and start thinking like a customer, you’ll understand that the secret to social media is in the "social" more than in the "media" - it's in being human – being the sort of person at a cocktail party who listens attentively, tells great stories, shows interest in others, and is authentic and honest. The secret is to simply be likeable.
Here are 5 tips for small business owners (and business people at all levels, really) to be more likeable and ensure greater success using social media:
  1. Listen first and never stop listening. Before your first tweet, search Twitter for people talking about your business and your competitors. Search using words that your prospective customers would say as well. For example, if you’re an accountant, use Twitter to search for people tweeting the words “need an accountant” in your town. You’ll be surprised how many people are already looking for you.
  2. Don’t tell your customers to like you and follow you, tell them why and how they should. Everywhere you turn, you see “Like us on Facebook” and “Follow us on Twitter.” Huh? Why? How? Give your customers a reason to connect with you on social networks, answering the question, “What’s in it for me?” and then make it incredibly easy to do so. Note the difference between these two calls to action: “Like my company's page on Facebook” vs “Get answers to your social media questions at http://FB.com/LikeableMedia.
  3. Why ask questions? Wondering why nobody’s responding to your posts on Facebook? It’s probably because you’re not asking questions. Social media is about engagement and having a conversation, not about self-promotion. If a pizza place posts on Facebook, “Come on by, 2 pizzas for just $12,” nobody will comment, and nobody will show up. If that same pizza place posts, “What’s your favorite topping?” people will comment online– and then be more likely to show up. Make sure you understand Edgerank - Facebook's formula for determining what shows up in people's ever-crowded Newsfeeds.
  4. Share pictures and videos. People love photos. The biggest reason Facebook went from 0 to 1 billion users in 7 years is photos. Photos and videos tell stories about you in ways that text alone cannot. You don’t need a big production budget, either. Use your smartphone to take pictures and short videos of customers, staff, and cool things at your business, and then upload them directly to Facebook,Twitter and LinkedIn. A picture really is worth a thousand words – and a video is worth a thousand pictures.
  5. Spend at least 30 minutes a day on social media. If you bought a newspaper ad or radio ad, you wouldn’t spend 5 minutes on it or relegate it to interns. Plus, there’s a lot to learn, and every week, new tools and opportunities across social networks emerge. Spend real time each day reading and learning, listening and responding, and truly joining the conversation. The more time and effort you put in to social media, the more benefits your business will receive.
Above all else, follow the golden rule: Would you yourself click the “Like” button, the Follow button, or Retweet button if you saw your business or your content here? Would you want to be friends with your business at a cocktail party? Just how likeable is your business?


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Good social media strategy: Lots of moving pieces moving quickly

The social media explosion is forcing companies to take a very different look at the suite of analytics tools that they're using to help them understand what’s happening – from monitoring what’s going on, to managing responses, to thinking about the broader picture about what those responses mean for decisions they need to make, and then think about the processes to react to all the interactions. Acting quickly requires processes to take all the insights wrung from the data and do something about it to increase the impact of your product or service.
For example, if you're launching a new product, one of the things that you want to understand is, first of all, whether there is any buzz about the product. Hopefully customers are saying positive things. Maybe there are certain attributes that they're talking about in relation to your product versus competitors. If there are positive attributes coming through, then you should consider amplifying those words in your marketing and buying them as search terms.
If you’re not picking up any buzz out there, you need to think about places to start fresh and give people a reason to talk (positively) about your product. You also need to look at the people who are buzzing or you want to be buzzing, for example influencers who seem to be powerful within certain communities – perhaps you can give them a sample and get them engaged with the brand.
If there's negative buzz, you better get out there fast and understand what people are saying. That requires a mitigation strategy to be in place before any negative buzz kicks in, or your response will be too late. That response has to be closely tailored to what’s being said. If people are complaining in the case of, for example, a shampoo product, saying that it's damaging color-treated hair, you then have to understand whether it’s an issue with the product itself or of people not reading the directions correctly.
Whatever the issue, you quickly find there are a lot of moving pieces that need to move quickly. It’s not just somebody looking at all this social media data in a way that’s divorced from the processes of the company. Whether it's analyzing that data and acting upon it or providing social services such as responding to Twitter feeds for customer service, you need to have an established infrastructure to handle all of this unstructured social media activity.
What we've seen in many cases is that setting up a good infrastructure can actually cost less than some other more established approaches.We've done some analyses on behalf of clients, for example, who have been interested in building Twitter or Facebook-oriented social support for their products. We've seen the infrastructure that’s been developed be dramatically less expensive than handling calls, or responding to email or chat. Often social service options on the web where the community is helping each other is one of the cheapest ways of actually handling it. And the great thing about this approach is that if you do it well and people see that, it creates positive buzz.
Which companies do you think are doing the best job building positive social buzz?

The second generation of cloud startups is here

Fred Destin is a partner at Atlas Venture.
There’s a little strategy game that both entrepreneurs and venture capitalists excel at.  It’s called re-segmenting markets. It’s as old as marketing itself and it’s very useful when you’re trying to define white space for your market. So cloud has now morphed into a series of acronyms that somehow all manage to incorporate “as a service”.

Maturity in PaaS

Behind all the hard work in seducing analysts into designing ever more precise magic quadrants, there is a movement at work in which the cloud is spawning the second wave of startups. Central to this new wave are dynamically configured – or “runtime” – services like Heroku that don’t require hardware provisioning and services that combat IT “lock-in” by making data portable. Both runtime and portability services not only need to provide value, but also must hide complexity from the user.
Let’s focus on the Platform as a Service (PaaS) segment for a moment.  If you think Debian is an electronica band you might not relate, yet companies like Heroku and EngineYard have slowly been building the infrastructure and range of scripting languages that web developers have been dreaming about. Unsurprisingly, they’ve also attracted the watchful eyes of acquirers (with Salesforce buying Heroku a couple of years ago) and incumbents (with SAP, RedHat, Oracle and VMWare all entering the space with slideware and, occasionally, product).
Now we’re all waiting to see how the game plays out and, in particular, what moves the big boys – Google with App Engine and Microsoft with Azure – make.

Mobile First

For those who think the real disruption is in mobile, PaaS isn’t where the puck is going. PaaS offerings were designed and built for a web-centric world, where customers build and host a backend and a web tier on the PaaS technology stack.   Mobile apps, however, live across native and HTML5 platforms that require libraries that connect to the backend.  PaaS doesn’t make this easy. Developers have to figure out how to connect cross-platform PaaS in a secure manner to their backend, while ensuring that the apps work online and offline, while synching data with the backend and various other third-party services.

Enter: BaaS

So mobile brings an explosion in complexity.  The services are now in dire need of smart “context awareness” (that’s a fancy way to see that you don’t do the same stuff on your mobile as you do on your big screen) and developers are dying to provide consistent experiences across devices.  Right now all we hear are stories of dev teams backing away from Android simply because they cannot deal with the platform complexity.  It’s a nightmare for everyone.  Who wants to bet their business on a single-platform, iOS-only launch?
Enter Backend as a Service (BaaS) – a simple runtime environment that spins up all the backend connectivity developers need, allowing them to focus on the user experience, not the app’s “plumbing.”  BaaS provides mobile developers with the entire backend stack, including native mobile and web libraries, which ensure the app keeps the data secure and works online and offline. As a result, developers have a consistent user experience across all devices.
Check out the infographic above (or click here for a larger BaaS infographic) to see where it fits in this increasingly complex cloud ecosystem.

Why should you care?

Back to my opening point: Who needs JASA (Just Another Stupid Acronym)?  Well, you may want to pay attention as the second wave of cloud services picks up where the first one left us.  IT infrastructure is a total mess, and with the emergence real-time analytics and big data it’s getting messier still.  We’re looking at a second wave of companies that are runtime by nature and facilitate (rather than impede) data portability all while shielding the user from technical complexity.
The VC industry has certainly paid attention. And since everyone knows we never create anything remotely interesting without entrepreneurs, that means the smart entrepreneurs took a liking to this trend a few years ago.  VCs are refreshingly dumb because experience has taught all of us that it’s no good being too smart.  So we look at massive macro trends (Ten billion devices!  One billion mobile apps!), hard customer requirements (speed to market, code quality and security, cost efficiency) and attractive platform opportunities.
There are in the region of 25 companies active in the BaaS space today.  I backed the guys who coined the term “Backend as the Service,” Kinvey, out of TechStars. Kinvey recently raised a $5 million Series A from Avalon Ventures (the team who backed Zynga) and from my firm, Atlas Venture. Parse and StackMob are two other leaders in the BaaS field, and there are rumors that Ray Ozzie is working on a BaaS startup too.
Michael Facemire at Forrester has written a good overview of the BaaS market, which is a great place to start if you want to learn more.
Money is flowing in for a simple reason.  If Salesforce is the hub for CRM and LinkedIn is the economic graph, then the company that becomes the data hub for the world of apps will be very, very valuable.  We’ve got their backend, so they can have yours.


The Facebook Phone Is Coming Tuesday, TechCrunch Is Sort Of Reporting

Facebook is holding a press event at its headquarters on Tuesday.
The company hasn't said what it's announcing.
TechCrunch columnist MG Siegler says Facebook will finally announce a "Facebook phone."
Or, at least, Siegler kind of says that.
He writes:
Multiple sources have told us that they expect some sort of Facebook Phone to be on display on Tuesday.
Now for the caveats (and they’re important). It’s not entirely clear if this will be an actual piece of Facebook branded hardware or if they will simply use hardware from a phone maker to show off some sort of new Facebook OS for mobile. That is to say, it could very well be that the “Facebook Phone” is more about a Facebook OS running on a phone (or a few phones).
But then he writes:
Complicating matters is all the chatter that Facebook has both publicly and privately told partners such as Google and Apple that they had no intention to build their own phones. Again, maybe it’s semantics. Or maybe Facebook simply changed their minds. Or maybe this phone/OS isn’t meant to compete head-on with the iPhone and the Android phones that Google focuses on. Perhaps this is meant solely for emerging markets.
Then Siegler quotes something Facebook CEO Mark Zuckerberg said at a TechCrunch event in September:
"It’s a juicy thing to say we’re building a phone, which is why people want to write about it. But it’s so clearly the wrong strategy for us."
Finally, Siegler nearly walks back the entire thing:
Facebook is fairly good at keeping things close to the vest these days. And the truth is that there are a number of things the company could announce on Tuesday. But speculation that is something smaller, like a new app, doesn’t jibe with the multiple sources telling us this is going to be “a big deal."
So there you have it. Facebook will reveal a phone on Tuesday. Or maybe it won't.