http://www.utterz.com/fp/social_network_streamer_small_green.swf?20

The Scrappy Marketer has a post today. So do many others including eMarketer. This is the Biggest Myth we have to bust.

Lets reason: Why does Email marketing have a high ROI?

1. People SPAM. Most people spam. Read the comments on Chris Anderson’s post on PR and look for a commenter named Dan. He and everyone else “buys lists” for the cheap. I got an email pitching me email addresses of 27,000 doctors in the US – for $395.

2. Its Easy: Yes there’s “ A/B testing, blah, blah, blah“. But Email marketing for most parts is EASY. You need 3 things right: 1) Target list – See #1 above. 2) Offer – In B2B whitepapers or 3rd party content works best and 3) Compelling draw – Again in B2B, sign up for this webinar now is sufficient.

3. Its CHEAP: To get a 2% open and 1% click through rate for an average sales price of $20 you only need about 20,000 names. Cost of this campaign <500.

Seth got this right “Email means the cost of adding one more name is zero. Email means that
lists keep getting bigger and bigger and once you’re on one, you’re on
em all.”

Its not the BEST ROI – Email is the CHEAPEST option if you SPAM & you do get returns, but is it the right thing to do?

Like saying “The easiest way to make a million is rob a bank” – but should you do it?

I am co hosting a webinar on Nov 14th with Jon Gatrell on
Supply Chain Management: How To Utilize Online Communities for Pharma.

This is being hosted by The Center for Business Intelligence. Please register to attend.

Details:

Leading
global pharmaceutical companies are enhancing their supply chain
management functions by using on line communities.  These communities
allow them to truly collaborate with their, partners, suppliers,
distributors & customers.  With extended fulfillment and multi-tier
distribution requirements, communities also need to be managed and
monitored for compliance.

Many
leading, bio/pharmaceutical companies have adjusted their traditional
supply chain management methodology to respond today’s on-demand 24/7
interactive and almost paperless world.   

Online
communities have entered into and been greatly accepted by the supply
chain management departments of bio/pharma.  There are some advantages
and disadvantages.

Join our speakers to learn if an online supply chain management community is right for your organization.

In this webinar, Mukund Mohan and Jon Gatrell will explain:

• The
  dynamics of online supply chain bio/pharma communities, and how to
  leverage those dynamics towards product innovation, trading and
  collaboration
• How to measure, manage and report the value from your community
• How to
  gain visibility and insight into your B2B collaboration and leverage it
  for collaborative use in support of ePedigree initiatives
• Methods
  for gaining immediate access to control visibility and traceability in
  your global supply chain from point of manufacture to end-user
• How to enable global partners and learn about international regulations
• Use of a community to share information about regulations, best practices and problem resolution
• How to drive value chain innovation, increase speed to market, reduce payment cycles and improve customer service

I had a chance to grab coffee last week with Michael Chin of KickApps. KickApps is one of the vendors that provides a turnkey solution to build communities. The company is about 60+ people based in New York with regional sales offices in Los Angeles. They have about 7000+ communities up and running according to Michael. He showed me a demo of one of their communities (thablock of HipHopMusicDotCom).

Basics:
1. Offering: Hosted solution with a good set of features / capabilities
2. Target Vertical Market: Media (publishing). Most small and regional newspapers / magazines & individual publishers are looking to build communities around the content they offer. KickApps is looking to target these accounts.
3. KickApps Pricing: 2 models exist currently:

• Using the KickApps Ad Network – No fee. They place banner and you can place your own skyscraper ads (Top and Left Column)
• You run your own ads and pay fees to KickApps based on CPM (per thousand views) – if you want to control your own advertising

4. KickApps Competition: While Jive and Leverage focus on Enterprise clients, Ning on consumer markets, KickApps sees Pluck (customer at USA Today) mostly in their competitive situations.

Assessment:
Since the original vision was towards empowering media companies to allow their users to connect and communicate, the theme of “rich media support” including videos, audio, etc. is evident within the KickApps product. Its a pretty easy to use and intuitive. Its well integrated with WordPress and they have a developer platform for API integration.

Useful Information: On the same lines as our 10 step checklist to building a successful community, KickApps put a 9 steps to a successful online community whitepaper. While simplistic  & not much new news, it reinforces some key traits of good communities:

Summary of 9 steps:
1. Define purpose and audience of community
2. Get a community manager (easier said than done, ask communityguy. com
3. Choose the right technology
4. Seed community with great content
5. Customize the look and feel
6. Promote the community
7. Encourage active participation
8. Manage your community with consistency
9. Listen and optimize

<img style="width: 350px; height: 225px;" src="/images/64360-56413/hiphop1.png” border=”0″ height=”305″ width=”700″>

Credit: Michele Hadburg from Bateman Group setting up the discussion with Michael.

NYtimes blog reports

My 9 books:
1. Kane and Able (Jeffery Archer)
2. Hitchhikers guide to the galaxy
3. Selling to the VITO
4. Macbeth (William Shakespeare)
5. Shall we tell the president ? (Jeffery Archer)
6. Treasure Island (RLS)
7. Calvin and Hobbes: The essential collection
8. Asterix and Obelix in Spain
9. Right ho, Jeeves (P G Wodehouse)

1. Email bankruptcy
2. Voicemail bankruptcy
3. Facebook bankruptcy
4. Twitter bankruptcy
5. Web 2.0 bankruptcy
6. RSS bankruptcy
7. Pitch by PR bankruptcy
8. Comments bankruptcy

Not to mention: Credit problems in subprime.

Not sure I really understand why people have to declare bankruptcy. Used to be there was a stigma about it. Now of course, its a badge of honor.

A ) Its easier to declare these bankruptcies than monetary ones
B ) Reminds me of the time I taught my uncle how to record on TIVO. He complained a week ago it was recording too much that he felt compelled to watch it.
C ) If you are unable to keep up, that’s okay, why feel guilty enough about it to blog it to the world?

News. Microsoft executive is not Putz.

<img src="/images/64360-56413/MSFT_Exec.png” border=”0″ width=”700″>

Jeremiah and Ian sound off on Web marketing budget allocation. I guess I could add some value since I am currently going into a budget cycle and am the VP of Marketing for a ~$140M software company.

I always prefer to talk in % allocation and follow 3 basic principles of marketing budget allocation:

1. Don’t peanut-butter your budget. Marketing folks tend to do this in most cases. Spend 10% on SEO, 10% on PPC, 10% on Social media, etc. I dont like it because it assumes they are not willing to take a risk. I dont buy the argument that “you need to be everywhere since you dont know what’s going to work”.

2. Web Marketing is a part of our budget, but its a only a part. Marketing budgets should focus on the “preferred” outreach method of the customer / prospect. Since most of our customers still seem to prefer face to face interaction, we spend more on events and lunches than web marketing. We do offer online mechanisms, but overwhelmingly our customers prefer the “meet and greet”. This might change in the future and we are willing to change it, but right now they “prefer” the mechanism they are used to.

3. Experiment. I have a guideline with our spending. Spend 10% on “one risky new mechanism” so you can experiment – high risk, high reward scenario. 90% of the budget tends to focus on “proven” mechanisms.

So how does our marketing budget look (this does not include headcount):

1. Lead Generation: 45%

1. Online & Web (includes PPC, Email marketing, list management): 23%
2. Social Media (mostly blogging): 2%
3. Promotional syndication: Whitepapers: 15%
4. Web seminars, independent research sponsorship: 5%
5. (Traditional) advertising – 0%

2. AR & PR: 25%

1. Analyst Relations: 15%
2. Press Relations: 9%
3. Customer reference program: 1%

3. Marcom: 5%

1. Content creation (whitepapers, datasheets, etc.

4. Events: 25%

1. Industry events (trade shows, seminars, conferences): 20%
2. Customer events (lunches, baseball games, etc.): 5%

Comments welcome. Do you think we are doing it right? What would you change?

Nick talks about why an economist stopped comments on his blog and makes the argument that if the # of users drops off, most “prominent” bloggers will stop blogging since their time is better spent elsewhere.

“If blogging is a successful means of establishing underappreciated
credentials – of remedying a failure in the idea market – then
ultimately the talent will be noticed and the talented economics
bloggers will move into positions in which their time will be better
applied to other pursuits, such as research or executive decision
making, in which they have greater advantage than they have in
blogging. Ultimately, you want the smartest economists to devote
themselves to something other than blogging, even if blogging may serve
a temporary role in helping those people move into positions in which
the value of their intellect can be fully exploited.”

Not sure I agree and will quote another very good blogger on what he learned on his “10 year anniversary” of cartoons drawn on the back of business cards:

“One of the smartest moves I ever made was to figure out that making money indirectly off the cartoons was far easier than trying to make the money directly. If I could teach gapingvoid readers just one thing, that would be it.”

What does this have to do with communities?

1. Most community members join and promote a cause not for the monetary benefit. Sure they have other things to do with their time and its probably better spent elsewhere, but this is what they would “really” like to do.

2. There are more indirect benefits of participating in the community than just the monetary ones that economists seem to care about.

3. Your early adopters and selfless promoters of the community are the ones to nurture always even though after a certain tipping point (in terms of # of people in the community) their influence starts to wane.

If you have been blogging for any amount of time, you’ll know that there are some metrics that are more important than others. Here are some metrics that dont matter:

1. Number of page views that your blog gets: Why? Lot of readers are “fly by”.
2. # of “RSS subscribers” – while this is a good metric for some, # of people that actually READ your feeds on a frequent enough basis is more relevant

There are a few other metrics that are “motivating”. What I mean by that is you feel like blogging because of these metrics:

1. # of, frequency of and type of people commenting. True measure of people reading, bothering to understand and offer an opinion.

2. # of “relevant”, inline links back to your post / content. This one is indicative of the fact that others think this is relevant enough to talk about or cite.

So what does this have to do with Robert? (Scoble). He get probably more comments per post than I do in a month of blogging. His pagerank relative to the things he does is very high (indicative of how many people cite his writing.

The #1 question I get from anyone in the early stages of a community is:

“How do we get the participants to talk?”.

So what can you learn from Robert:

1. It takes time. Robert’s been doing this for years.

2. It takes engagement. I think he practically responds to “every” comment and truly ties to understand their point of view.

3. MOST IMPORTANT: Its genuine or as Rohit called it – Authentic. I have met Robert several times at many geek events and parties. I know he meets over 50 people daily. Not once (even the first time I met him a year ago) did he make me feel like I was another nobody in large set of people.

The only reason he gets so many comments and his audience is engaged is that he “truly” tries to connect with people. Its not artificial.

That’s the #1 tip when you are starting to build a community.