Thursday, September 29, 2005

What To Do?

The universal problem seems to be how hard people have to work just to figure out what to do. Task work has become streamlined, but knowledge work has become more cluttered and confusing. Making the right choices - fast, while everything's changing - is now the toughest part of getting our work done.
from Simplicity: The New Competitive Advantage in a World of More, Better, Faster by Bill Jensen
Let's add "learning new things" and "making new connections" to that last sentence.

I like to think that "Web 2.0" is about trying allow a more graceful pivot - one with meaning rather than random pivots whenever we feel like it. Seems like mashups, Backpack, and Yahoo! 360 all help us take steps from data to information or relate tasks to a goal. I can't wait to see how things evolve to help find knowledge in that information.

Tim O'Reilly posted this Meme Map from Foo Camp, which sets some context for the activities, but doesn't say what all of these inputs lead to. For example, harnessing collective intelligence is great, but it necessitates a way to filter that new information in a way that allows you to gain knowledge from it.

Like Bruce Sterling said at SXSW, the reward for solving societies greatest problems is a better set of problems.

Business Cycle Contraction

As you can imagine, with the fragmented attention span of the consumer, business cycles are contracting. This effect reveals itself spectacularly in the movie/DVD business, as the studios get to experience the same cycle twice.

DreamWorks' Shrek 2 experience details just that.
The DVD business is going the way of the movie business—the sales window is getting squeezed so that every bit of time after a movie opens or a DVD is released is more important then ever. We’ve seen this trend become more exaggerated over the past five years in the movie industry. People rush to see a movie in the first weekend after it’s released, then attendance drops off dramatically (unless it’s a sleeper, word-of-mouth hit). That drop-off makes it all the more important for movie studios to lure viewers that first weekend, which leads them to load up on advertising.
from Fortune Streetlife, July 12, 2005
Wait a minute. This trend points to two major things - those so-called "sleeper" movies are actually good. Most movies these days are not very good, unfortunately. When people see a movie that is truly inventive, interesting, funny, or just plain good, they tell other people. Memento and the 40-year-old Virgin were both movies that fit this mold. Quality generates word-of-mouth. Nothing else.

In the case of DreamWorks, they have to distribute the movies and DVDs ahead of time and advertise the hell out of them, so they have huge sunk costs.
But as DreamWorks found when it overestimated Shrek 2 DVD sales, DVD buyers have a super short attention span. The dilemma: If you flood the market with DVDs as soon as you release a movie (as DreamWorks does), and count that as revenue, then you’re stuck with lots of returns. That's why studios like DreamWorks are looking for other distribution channels.
from Fortune Streetlife, July 12, 2005
In this instance, now DreamWorks must take a big charge for returns. Thus, these cycles changes will demand different company planning and encourages them to explore things like on-demand distribution and whatnot.

As Seth Godin keeps repeating (and hopefully will until we get it), companies that focus on making truly remarkable products will be the ones that survive in our current over-saturated consumer culture.

I would add to that less reliance on mass marketing and big bang attempts to create a market for a product that people in which people may not be terribly interested. In the DreamWorks case, much of the problem is that they have to appeal to the parents, especially in the theater phase of distribution. The kids are the real consumers, but if parents aren't spreading the word-of-mouth, it's likely that the kids won't see the movies.

Part of me feels for companies like DreamWorks. I know people that do that kind of work - they are brilliant and creative people who do amazing work and don't want to see their companies lack of insight into their customers affect it.

Mass Marketing Is Broken

In his Chaos Scenario, Bob Garfield notes that "the cost of reaching 1,000 households in prime time has jumped from $7.64 in 1994 to $19.85 in 2004."

Plus, not only do you have to reach the people who are watching, you have to actually have their attention. Linda Stone's "continuous partial attention" theory suggest that your ad will compete with any number of other things - cellphone, email, etc, that will have a stronger personal connection to the viewer.

Think about how television watching has changed. In the 1950s and 60s, the entire family sitting around the television in the evenings, watching the advertisement on one of 3 or 4 channels. None of the main instant-on devices were available. They didn't turn on the radio or make a quick phonecall during the break.

Over time, that has devolved into the situation we have today - hundreds of TV channels along with the multitude of other opportunities for diversion.

Add in the proliferation of marketing channels - product placement, ever smaller billboards (see the coffee sleeve for a key example) - and you have a complete saturation of marketing messages for the consumer. This translates into a crisis for the Marketing Team. Still the majority of the marketing spend goes to the standard channels of TV, print, radio, and (now) online banners.

The old companies have the hardest time changing. Still, there are good examples. Toyota nailed it with Scion. They built these things from the ground up based on guerilla research with the younger set. The marketing approach has also shown this kind of ingenuity.

You almost never see a Yahoo! or Google advertisement. They don't need to. They launch a new product or feature, and key bloggers are all over it almost immediately. The user base grows organically (which, incidentally lets them gradually test the scalability of the web app). It stays in Beta mode until they're ready to launch it, then some online ads appear just in the right place, and there you go. New product.

At some point, every Marketing Team will need to deal with this issue. Right now, there's some experimentation, but online banner ads and popup ads are lame, print ad-like applications of online advertising. Should be interesting to see how it develops as the fire turns up.

Saturday, September 10, 2005

Stop Wasting Our Time!

Blake's post on downloading MS Money is hilarious, if exasperating, but also stands as a monument to how big companies still don't get it.

The post culminates in a comment by BenJ:
Budgeting doesn't need to be so complicated anyway.

Amen! I think that's why we're all here.

Both Microsoft and Quicken employ some of the most intelligent software people on the planet, but getting a simple, easy-to-use software package out the door in such large companies will continue to be a problem until two issues are solved.

Issue 1 - Put together a small team and leave them alone.

Updating people and justifying decisions to a vast array of senior managers can suck up a huge, and I mean HUGE, part of a team's time. Once the project is determined to be worthy of funding and you have your crack team in place, put a trusted senior manager/executive in charge of monitoring them and leave them alone.

Encourage the team to be in contact with their colleagues on other teams so that they have insight into what other projects are doing, but it's hard enough to do this stuff right. Let them focus.

Issue 2 - Let users buy/build extensions to add functionality they need.

First, develop a simple, easy-to-use basic framework for the software and then create extentions to let users integrate functionality specific to their desired uses. This works well in basically any software (personal, business, or enterprise). For you business strategizers out there, this can be turned into an income stream quite easily.

In fact, go one better and let other people develop extensions. The oft-mentioned APIs (Google Maps and craigslist) that created are very powerful in generating ideas for future development. If you find one you really like, license it. In this case, your customer works with you and gets something back. Heaven forbid.

As I work in a large organization, I feel the pain of the MS Money and Quicken teams. These tactics do not need to be unique to 37Signals and Adaptive Path. It seems like people are now frustrated enough, the tools are available, and the audience is starting to look elsewhere.

Life is complicated. Software shouldn't make it worse.