Internet Marketing Strategy and Implementation

Business Bootstrappers vs. Angel Capital - MIT Enterprise Forum March, 2010

2010-03-19T21:39:00.002-05:00

Two scrappy entrepreneurs squared off with two beneficent angel financiers to discuss the state of entrepreneurial innovation at the MIT Enterprise Forum on Tuesday, March 16. The entrepreneurs were Jeff Judge of Interactive Mediums, which provides a platform for managing and implementing mobile ad campaigns, and Chris Hill of PerkSpot which helps corporations communicate and manage access to third-party employee benefits, like AFLAC or discount programs from Dell or Six Flags. Judge is not seeing capital while Hill is quietly raising a round of that he says he would like to be $1M.

The investors were Jeff Carter of Chicago's Hyde Park Angels and Laurence Hayward of Cornerstone Angels. They represent "angel" consortia, groups of investors who buy into early stage companies. Angel investors come into companies early -- often before they have any customers and invest smaller amounts than "Venture Capital" firms. Angel investments will typically be rounds that range from $100K to $1M, while Venture Capital invests in the $3M - $7M range.

Linda Darragh, Director of Entrepreneurship Programs and Adjunct Associate Professor of Entrepreneurship at the University of Chicago's Booth School of Business was an excellent and knowledgeable moderator.

Both of the entrepreneurial bootstrappers were very successful. Both had started their companies with their own money, and not a lot of it by venture standards. Both companies have Fortune 100 companies in their client portfolio. PerkSpot was lucky to get Anixter (just out of the Fortune 100) as one of their first clients. They had a contact in Human Resources who needed their product and who walked them into the office of the VP.

Interactive Mediums started out with several bars and restaurants, small local businesses with a hip, mobile-friendly clientele. Then they want to a trade show (with four employees and four friends, a classic fake-it-until-you-make-it move) and found some corporate marketers who wanted an easy, inexpensive way to test out mobile campaigns. Judge said he was caught off-guard when the first corporate client said "yes"!

Both companies have grown, and from the sound of it, Judge's company has changed the most in terms of their product offerings. He says that the company will transform dramatically in the next six months in terms of who they target and what their system does.

While this wasn't a formal "pitch session", both of the investors responded favorably to the entrepreneurs. They have solid products. They described good teams and an ability to adapt to the marketplace. Most importantly, both had "marquee customers."

In terms of "elevator pitches," neither described themselves as solving a "big, pressing problem" and neither discussed their competition, be it a company or the status quo. Nor did the discuss barriers to entry for competitors.

Since neither was pitching for investments at this event, it was understandable that they did not address the issue of how an investor would make money out of the deal, which would include a discussion of how scalable the business is and who would be potential acquirers.

Interactive Mediums' Judge said he would avoid outside investment as much as possible. His biggest concern was that Angels and VC's don't sufficiently value the founder's equity. Hill expressed more flexibility. Both agreed that seeking funds and keeping investors engaged and happy would take up much of the CEO's time and energy.

When asked "how did you bootstrap?" Hill said that there is "a major lack of early funding in Chicago. I bootstrapped because of that environment." He focused on solving the problem of companies communicating and managing discount programs for employees and looked for his first sale. He wanted a good developer and used equity as an incentive.

Judge started with personal funds and, before the credit crunch, was able to get a $100K loan. He follows the formula, for every $10K in increased monthly revenue, he can hire one more person.

On the investment side, Carter and Hayward provided some insights into Angel Investors in general and Hyde Park Angels and Cornerstone in particular.

Cornerstone has done 17 deals since 2006, investing $4.5M. There is wide variation between deals, from $50K to about $750M. The entrepreneurs are mostly looking for $500K to $2M. They funded three manufacturing companies who had "better processes" for industry.

They have twenty full members and they have five or six investment meetings where two or three candidate companies present. These events get forty to fifty people by invitation only, generally members and some entrepreneur guests. Members collaborate on due diligence and write individual investment checks. Only a third to a half of the presenting entrepreneurs get funding from these events.

In addition, Cornerstone holds five or six screening events per year, with 5-10 members from the screening committee in attendance. This year, Hayward says there are good entrepreneurs are coming out of the woodwork. Even the best connected entrepreneurs are having trouble finding funding from their close circles of friends and family, so more deals are coming to light in semi-private Angel Investment circles.

Cornerstone will invest outside the Midwest, while Hyde Park Angels keeps their investments "one day's drive" from Chicago. They have fifty-five angels and will cap membership at one hundred.

Hyde Park Angels lists four companies on their portfolio page, with a fifth deal recently closed and the Chicago Tribune reports they have invested "about $3M" in the four companies.

Hyde Park's investment criteria can be found at http://hydeparkangels.com/invest.html In addition, Carter has two other investments outside of HPA. They are in Tallgrassbeef.com, and windetergent.com.

Angel groups like to get other angel groups to invest with them. It spreads the capital risk to other communities and brings in capital from places other than Chicago and the Midwest. Angels want to get the first round of financing full because later rounds will often dilute their equity position.

In contrast, VC investments average around $7M (Carter says that "over $3M is VC territory").

Hyde Park Angels works with the Polsky Center for Entrepreneurship at Chicago Booth. They have ten interns (hiring 5 per year from a pool of over a hundred applicants). Carter praises the U of C students as being critical to the success of HPA. Entrepreneurs pay $100 fee to submit a deal. Hyde Park gives "a fast no and a slow yes." They present three potentially qualified deals at each quarterly meeting, and their goal is for members to fund all three of those deals. The format of the meeting is 10 minutes to pitch and 10 minutes Q&A with the panel.

Carter brought up that .05% of companies go public, so investors want to know how they will get paid. Hayward explained that investors are looking for an IRR from their fund of 19%. Since one or two out of ten investments provide 90% of the return, they are targeting a minimum of 25% IRR from each deal.

The point was made more than once that angels look to invest in scalable businesses that can be acquired, not "lifestyle businesses." This is a key point. Many entrepreneurs have really great ideas for businesses. They might not be a perfect fit for an angel investor because they are not scalable enough to become big business as envisioned by the entrepreneur. However, this shouldn't dissuade entrepreneurs from starting businesses. You can provide a pretty good income for yourself and family by starting up and running your own business.

As is usual with the MIT-EF meetings, there were some excellent questions. Both of the investors said they would like to see a social platform where they could have visibility to all local "deal flow" -- who is seeking funding, and who is investing. Carter recommended the book "World Wide Rave" by David Meerman Scott on the subject of Social Networking. He encourages every entrepreneur (and angel) to read it. The entrepreneurs were split on the value of Intellectual Property protection, but neither had pursued patents due to costs (much to the chagrin, I'm sure, of event organizer Bob Brill and event sponsor Ungaretti & Harris). The issue of control came up. The Angels generally take a minority position. Hyde Park Angels want a seat on the board, while that's not always a requirement for Cornerstone's investments.

As always, feel free to contact me with any questions or corrections (grammatical edits aside).

2010 CMS EXPO: Taking Control of Your Website

2010-03-09T09:10:00.003-06:00

In our experience, there are two pre-requisites for businesses to profit from their web sites. The first is web analytics, so that we can understand how people find your site, use web site content and how they react to changes. The second is control over the web site's content. For this reason, we recommend that you consider using an industry standard open source Content Management System (CMS). The three most popular CMSs are WordPress, Drupal and Joomla.

If you are considering a CMS or are currently using a CMS, you might want to attend the CMS Expo, May 3-5 in Evanston, Illinois. The CMS Expo provides important information to marketers and business owners who want to take control of their web sites. The CMS Expo business track will cover a wide range of issues related to making your web site profitable. Introductory sessions will be provided for all of the major Content Management Systems and for many modular components that make these systems so powerful.

The 2010 CMS Expo will mark the 4th professional gathering of the CMS Community from around the world. The CMS Expo focuses on delivering highly useful information, tips, tricks and actionable advice to attendees. CMS Expo is a learning conference, for users at all experience levels, not a "pitch session" for vendors. CMS Expo exemplifies a cooperative, sharing business environment with vigor.

CMS Expo is for all members of the Content Team – Administrators, Business people, Creatives and Developers - who collaborate to create great websites. There are sessions to help every member of the Content Team master their particular area of expertise.

For Business people, the CMS Business Track, co-chaired by Metrist Partners' Avery Cohen, provides the opportunity to learn from business experts who are respected around the globe. The Business Track provides a full gamut of high quality business sessions, providing highly relevant and timely web business insights, shared by many of today's most successful business minds. Participants will learn timely ways to enhance your business, streamline processes, protect your assets and boost revenues. Session topics include Google Analytics, Social Media, Search Engine Optimization and Usability Testing, to name just a few. Last year, many attendees were so enthralled with the CMS Business Track, they never left the track - for the full conference!

If you are a web site or applications developer, there are sessions on WordPress, Drupal and Joomla that range from beginner to expert. There are sessions for developers, designers, marketers, and managers. Web applications developers can learn advanced topics, like how to build plug-in modules that utilize the CMS's existing code framework. Designers can learn how to create your own theme or design templates.

With a full three days of learning sessions, the CMS Business Track will provide great insights on how to run, promote and structure your web business for maximum success, and maximum ROI. Click here for more information.

Google Personalized Search - Do you really rank that high?

2010-02-24T15:07:00.002-06:00

What You See is NOT What Your Customers Get: The impact of Google's Personalized Search

As of December, 2009, Google has been personalizing your search results. Sites you like show up more frequently in your Google search results. Google figures that the sites you like are the sites you click on for search results or, if you have Google Toolbar, any of the sites you visit on your computer. Those sites will show up higher in future search results -- for you.

Google thinks this will make you happier, as they say: "Today we're helping people get better search results." This is nice, but this means you aren't seeing the same search results as everyone else. If you visit the NY Times a lot, Google will show you the NY Times more often, while Fox News fans will see Fox more often and more highly rated.

What Google personalized search means to the entrepreneur:

Your site will appear to rank higher on Google results pages. But only on your computer. Because you click on your web site fairly often, your site will appear higher on search results for you. It may look like your site is rising in Google search results, but this could be your personalization in action!
Your competitors may appear to rank higher on Google results pages. If you occasionally (or frequently) click on your competitor's search listing or visit their web site, their site will appear higher than other sites. Again, these results will be customized for you.
What you see is not what others get. Your results are personalized, so you are seeing your own reality. And your customers are seeing their own reality, thus...
Your best customers will see you rank higher! Similarly, your competitors' best customers will see their vendor, your competitors, rank higher.

What you can do about it, how to see the world they way it really is:

To see what the new-to-you, blank-slate world sees, you will need to opt out of Google Web History so that your web activity does not skew ("personalize") your search results.
Just to be sure, you might want to install a variant browser on your computer and use that browser to check your search position. Don't click on search results on that browser.
Keep following Google's search engine optimization best practices, including fresh, relevant content and quality link building!

Instructions for opting out of Google Web History, which personalizes your search results:

Opting out of Google Web History will make it so that Google doesn't track your activity across computers and browsers.
Now, it depends on how you interpret Google's online postings. It may be that Google will still personalize search for the browser on which you are working, based on the identifying cookie on the browser. It's not clear if opting out of Web History and then signing into Google will result in NO personalization occurring in your search results. But Google does say that you can turn off personalized search by opting out of Web History.

Here's how:

If you are signed in to Google, you'll need to remove Web History from your Google Account. You can also choose to remove individual items. Note that removing this service deletes all your old searches from Web History.

If you are not signed in to a Google Account, your search experience will be customized based on past search information linked to a cookie on your browser. To disable history-based customizations, follow these steps:

In the top right corner of the search results page, click Web History.
On the resulting page, click Disable customizations.(Because this preference is stored in a cookie, it'll affect anyone else who uses the same browser and computer as you).

Note: If you've disabled search customizations, you'll need to disable it again after clearing your browser cookies; clearing your Google cookie turns on history-based customizations.

Some technical points about Google personalized search results

Google used to only personalize search for users who were signed-in to Google. Now they personalize based on the identifying cookie on the browser, and fine-tune when you are signed in to your Google Account. This means that they track based on search results you click on if and when you are not signed in to your Google Account.

For more info, visit Google
http://www.google.com/support/accounts/bin/answer.py?hl=en&answer=54048
http://www.google.com/support/accounts/bin/answer.py?answer=54067

Social Networking Basics for Marketers and Entrepreneurs

2010-02-04T22:17:00.000-06:00

2010 is fast becoming the year of Business Social Media marketing. Two drivers from last year continue to push entrepreneurs and marketers into Online Social Networks. First, Barack Obama proved that it can work in a big way. His presidential campaign used it to motivate people to spread the word. Second, the faltering 2009 economy made everyone with a job feel like they were ninety days away from either needing a new job or starting a new business.

People connected individually in a big way in 2009 as businesses began experimenting. Now businesses large and small are connecting with customers and prospects through existing Online Social Networks like LinkedIn, Facebook and Twitter in 2010 marketing initiatives and campaigns.

The good news for busy entrepreneurs and marketers is that online social networking makes spreading the word and/or reaching out to your network easier and more effective than ever. Many of our friends and clients are using these tools to connect with audiences where they already are online.

If you have information or news about your company or product to share, including information that is already on your website, you can use social networking sites to extend the reach of your message beyond your own web site. It’s also a great way to create traffic to your Web site, and that’s a great way to gain traction and grow.

Selecting a Network:
There are social and business aspects to online social networking. Linkedin is the online social network for business, while Facebook is predominantly friends and family. Twitter, a real time short messaging service, is very much a hybrid of the two. Because Twitter content is “open” – anyone can see and reply to any listing, the use of search keywords is critical to the effective use of the social network.

The first thing to ask is what do you want to accomplish? There are three key outcomes for entrepreneurs and marketers who participate in online social networks:

1. You can become known among your colleagues and target audience (your potential customers) as someone who is knowledgeable and has a giving personality —someone who contributes information, shares knowledge, connects people, and perhaps even lightens another person’s day with a funny comment. Engaging this way, and reaching out to others who are similarly engaged, will expand your online network.

2. You can build social relationships that become business relationships.

3. You can promote your events (like our Internet Marketing Seminars), share learnings from your accomplishments (talk about your customers), and create excitement about events you are attending (like industry conferences).

Determining your priority among these outcomes will help you to prioritize your social networking plan. For example, LinkedIn is best for the first outcome, while Facebook is best for outcome #2, and Twitter is best for outcome #3. Nevertheless, you should still use the other social networks to reenforce your social networking goals.

Use Social Networks like a Search Engine
Monitor your keywords – the words and phrases with which you want to be associated -- on LinkedIn and Twitter, and use your keywords when you post and participate. When you need business resources or guidance, consider using the search functions on LinkedIn. To make the best use of Twitter’s openness, we recommend desktop platforms like TweetDeck or Seesmic. You can set up live searches for your keywords and easily join the conversation.

Use Social Networks like Email
Check in on your social networks a few times a day, when you check your email. Respond to content that is relevant to you and your audience.

Measure Your Results
Effective social networking results in growth in network size, so tracking the number of connections on the networks where you are active is one form of feedback. There are also online tools like Twitter Analyzer and Twitalyzer that scan your participation on Twitter or Facebook and provide feedback on the quality of your participation. We work with our clients to interpret the feedback from these tools and to determine how to integrate the feedback into our clients marketing plans.

The Five Biggest Mistakes Companies Make on Their Websites

2009-10-19T15:02:00.001-05:00

People often ask whether we see any big “mistakes” on their website. We usually respond with this question, “What are the goals for your site?” Assuming your goals are to generate new leads or sell products and services, here are five “mistakes” we often find on a website:

1. No Planning or No Tracking
Who do you want to come to your web site? What do you want them to do once they get there? How many visitors turn into leads or customers? Analytics tools like Google Analytics can help you to see how people found your site and what they do once they get there. With this information you can take action to improve your marketing as well as the site content to help customers and prospects find you and reach their goals. Google Analytics is free and easy to configure for reporting on your specific goals.

2. Weak or Missing Call to Action
Your customers come to your site to solve a problem. They want to quickly learn about what you offer, and, if there’s a fit, to buy your products or engage your services. Are you making it easy and quick for them to achieve those goals? If you’re not, then you’re losing customers. Every page on your site should have a clear call to action to make it quick and easy for your customer to achieve their goals.

3. No Email Registration
Maybe your customer isn’t ready to buy. Then, you need a Plan B so that you can keep in touch and stay top-of-mind. Our recommended strategy is to get site visitors to sign up for your newsletter. Of course, if you don’t make this easily available to your customer, then they’re not going to sign up. We recommend offering customers the opportunity to sign up for your newsletter on every page of your site.

4. Lack of Search Terms
Your analytics tools will show the terms that people use to find your site via search. If there are terms that describe what you want to be known for, does your site incorporate those search terms explicitly into its content? Are you linking from your content to additional information on your site using those exact terms for which you want to be known to your customers? It is important to use the terms customers are most likely to use in search engines. In other words, if customers find your site using the search term “cool widgets,” then when they land on your site they should see content discussing “cool widgets” and linking to content about “purple cool widgets.” You can find out which terms are most popular on Google Insights for Search.

5. Not Enough Traffic to Your Site
Search Engine Optimization is a start, but it needs to go beyond metatags and keywords. Setting a public relations campaign with timed press releases that link back to your site is key. Additionally, if you want your customers to find you before they find your competition, consider a Paid Search (Pay-Per-Click) Campaign.

Metrist Partners runs multi-day, hands-on workshops on Paid Search and Internet Marketing, as well as customized workshops and webinars on a variety of internet marketing topics, including, Paid Search, SEO and Social Media. We also consult with our clients on a variety of internet marketing solutions. Please contact Susan Shulman at susan@metrist.com for more information.

Adobe to buy Omniture

2009-09-16T16:14:00.004-05:00

I'm sure you have now seen the news that Adobe Systems has announced its intention to purchase Omniture, the providers of some of the most important online and cross-channel analytic products offered today.

It is an interesting play for Adobe. As more and more applications of their trditional applications will be served "in the cloud" and perhaps undercut by open source equivalents, Adobe is buying the leader in high-end online analytics, a business that is only reaching its stride as a way for businesses to cut unproductive expense and increase revenue.

When to Use Paid Search: Making Paid Search Pay For You

2009-09-15T14:05:00.001-05:00

Many of our clients are interested in paid search, but question whether it’s worth the effort and cost, and whether it's right for B2B or just business to consumer. So when should you consider using Paid Search?

1. When You Want More Visitors on Your Site:
Being on page one of any search engine results in increased traffic for your web site. Getting your site listed on page one takes time and requires optimizing for specific words or phrases. Paying for a position on page one accomplishes a similar result faster.

2. When you Want to Attract Customers on Specific Keywords:
Paid Search gives you the ability to pay for position on these less-frequently searched for terms that are farther along the decision and purchase cycle. Again, the "landing page” selection is critical for the success of these campaigns.

3. When the Competition is Doing It:
No one wants a potential customer to engage with their competitors. Paid Search provides the ability to pay for keywords that your competitor might use and intercept that traffic, directing visits to your site rather than your competitors. Tools like Keyword Spy can provide directional insights into the competition’s keyword bids.

4. When you Want a Cost-Effective Way to Test New Marketing:
Paid Search is a cost effective way to test the effectiveness of different marketing messages. In fact, you can consider Paid Search to be the world’s largest (and least expensive) focus group.

However, paid search must be done in conjunction with web site optimization. Site optimization includes search keyword optimization along with tracking and measuring what visitors do on the site. Once you know the likelihood that a site visitor will make a purchase or become a qualified lead, you have an idea of how much you can bid for a visit and still make a profit.

If you don’t track and measure leads and sales resulting from visits, you are likely to waste more money on paid search than you make (we’ve seen it!) Analyzing visitor behavior provides insights into making visits more productive and profitable, for you and your customers or prospects.

Metrist Partners is hosting a free "Paid Search" Breakfast on October 1, 2009, to discuss how and when to use Paid Search to profitably bring more traffic to your web site. For more information email susan@metrist.com or call 847.926.8280

Ad:Tech Chicago -- New Media vs. Traditional

2009-09-11T01:36:00.003-05:00

Ad:Tech Chicago 2009

With a mouthful title like "Master Class Workshop: Defining the New Media Currency – How to Bring Traditional Media Metrics Online – Or Should We?" we see how Ad:Tech is different from other Internet Marketing conferences. The focus here is on the impact that Internet technology has on the $100B+ advertising industry. The advertising industry has proven highly resilient in the face of the Internet Marketing revolution.

We are continuing a conversation that has been going on for nearly a decade. As Chicago-based ComScore"s Gian Fulgoni put it early in the session: 8% of all media dollars go to the Internet but 25 to 30% of media consumption is online. Internet Marketing mavens have been railing on the Mad Men to "get it" and shift their spending to online media. But the Internet argument has focused on "Direct Response" and has shied away from "Brand Impact" and the metrics that agencies care about, like "recency" and "frequency". Fulgoni says Internet marketers have got to pull in traditional branding dollars by talking the language and providing the impact of other branding vehicles.

The session panel:

Kelly Twohig, Moderator – Executive VP/Digital Activation Director, Starcom USA
Marc Johnson -- Chief Marketing Officer, Hitwise
Jon Gibs, -- VP, Media Analytics, Nielsen Online
Gian Fulgoni – Executive Chairman and Co-Founder, ComScore, Inc.
Todd Teresi – Chief Revenue Officer, Quantcast

The Discussion:

Teresi of Quantcast said that the power of online marketing is addressability, you can see the behavior of individuals. He is interested to see what happens when television becomes similarly addressable through set-top boxes. Then, he says, "engagement" and "behavior" will engage the minds of brand marketers.

Teresi says that some marketers see the impact that engagement has when they look at Social Media. Right now, Internet Marketers are not talking the same language as Brand Managers. We need metrics that Brand Managers can relate to.

Gibbs agreed "we need to speak in a languages that adheres to the language of the current system."

Then, Teresi asked, can we help marketers see beyond the demographics of "Women 18-29"? There"s more nuance under that. Fulgoni identified three components needed: first the marketer has to have a target defined, then you have to figure out impact and then analyze. Then you can go back and talk about media "reach" to that target, people times exposures.

Gibbs says that the creative still has a way to go, looking at non-standard ads and their surrounding experiences allows publishers to differentiate themselves from ad networks. Better targeting, greater impact.

Twohig asked how a media buyer can make a decision on a large scale, there are so many methods of data collection. How do we create a standard vocabulary for metrics?

Teresi said Marketers only care when they can create definitions of their own target market. Marketers need to be able to define their own audience. This is why search marketing is such a big deal. In display advertising, you can"t target the audience. But Gibs said that while 1-to-1 targeting is an awesome ideal, Media Planning is the art of trying to find your audience. "We" say our targeting model is perfect, but the planners often miss; post-buy reporting is needed to answer two questions: "who did we hit?" and "what did they do?"

Teresi observed that holding companies are building targeting platforms to reach the "important" audiences. They buy publishers who have a specific target audience and then sell an ad network bundle. Fulgoni doesn"t think these ad networks have enough of the picture to do a good job of targeting a specific audience. For example, he says, web analytics (Omniture, Google Analytics) ignore the value built up to the final click that brought a visitor to a web site. Web analytics reporting reports are read as if the only reason for that click was, in most cases, the last search at the last search engine. Further, if you expand the targeting to all activity by the person within the ad network using cookies, you still only see about 10% of the person"s activity. So much for 1:1 targeting.

Teresi says that cookie-based targeting does give consumer intent. And the Media Buyer has to know what they are buying. There was then some back-and-forth between Teresi and Fulgoni about data capture methods (Quantcast collects data through a network of participating web sites that share visitor cookies while ComScore and Nielsen use sample panels who have opted in to let all their Internet usage be tracked).

Twohig came back and asked "What is important to know?" Gibs said there are three key questions that advertisers need to know: 1) How many people did I hit? 2) Who did I hit? And 3) Did it work?

The client sets goals and these include offline ROI and branding metrics. Gibbs and Fulgoni both said that there are significant gaps in the ability to accurately measure reach and frequency. Whatever method you use, there is extrapolation and estimation involved. Johnson brought up comments from Ad:Tech keynote speaker Rashad Tobaccowala, CEO of Denuo and Chief Innovation Officer at Publicis Groupe Media: 1) People will continue to do Business as Usual and 2) to do new and innovative things, we need metrics.

Twohig then asked how to coordinate when media planning, buying, delivery, and reporting are all disparate systems. Gibbs pointed out that that"s only Internet, the media are in silos and addressable TV is still fairly far away. Twohig asked what tools there will be in five years.

Fulgoni said you need to know if the advertising generated sales, and advertising (as opposed to direct marketing) takes time. "Sometimes I think we want to generate sales faster than the real world will allow."

To provide effective information to those areas, you need to know what you delivered to whom and you have to know the effect, including offline purchases. Johnson pointed out that understanding the impact of online advertising and breaking down of silos between media is happening more and more as a new generation moves into executive leadership.

Gibs says that when AdAge editorializes that "the agency is dead" they are wrong. Agencies understand how to manage a brand across media. And Fulgoni claims that it costs an agency three times to do planning and buying on the Internet versus TV for the same company to reach the same audience. To scale to their needs, they will need set-top data and "three-screen visibility" to consumers along with single-source planning.

While Internet marketers look for the best "brand experience" and experiment with Social Media, the big advertising industry works on a different scale and speaks a different language. Until that gap is bridged and and a measure of impact is accepted, the big money will stay with big media, business as usual, despite an enormous gap in attention.

Follow-up Video from Windy City Social’s Social Media and Online Marketing Summit

2009-08-03T12:14:00.003-05:00

The Social Media Masters event from Windy City Social was great fun. They produced a video that captures the spirit of the event. Avery Cohen's presentation can be seen in the background -- "Marketers Roadmap" and "Developers Roadmap" slides.

#measure is the new Twitter hashtag for Analytics (buh-bye, #wa!)

2009-07-28T23:19:00.006-05:00

Web analytics guru Eric Petersen, who initiated #wa as the Twitter hashtag for analytics, to the consternation of web metrics types who really didn't care about news from the state of Washington, just announced #measure as the new analytics hashtag. Let the wild rumpus resume without an excess of news from the NorthWest!

Windy City Social’s Social Media and Online Marketing Summit

2009-06-19T12:57:00.004-05:00

Avery Cohen from Metrist Partners will be presenting "Ten Tips for Improving Your Search Engine Optimization" at Windy City Social's Social Media and Online Marketing Summit. The event also includes one-on-one consultations with the speakers, so bring a list of questions!

Guests will connect with other marketers and learn about the latest trends in Social Media and Online Marketing from leaders in the industry. People will leave the event with new, innovative ideas about how to leverage Twitter, Facebook, SEO, E-mail Marketing and Experience Marketing.

Several of the speakers and sponsors will be on hand for 15 minute consultations where they’ll give attendees immediate steps they can take to improve their actual site or campaign! And our speakers are going to pick a few emails and websites submitted by attendees in advance to critique during presentations.

Speaker Highlights

Creating an Experience They Will Remember (in a good way!): Cereality Founders Rick Bacher and David Roth
E-mail Makeovers: Reagan Taylor, NCR
Top 10 Tips for Improving Your Natural Search Rankings: Avery Cohen, Metrist Partners
Tips on How to Get the Most out of the New Fan Pages: Brad Keown from Facebook
Panel on Using Twitter to Promote Big Business

Consulting Highlights

Email Makeovers
SEO Review of Your Site
Strategic Blog or Website Review: Strategic Marketing & Blogging Expert Liz Strauss (limited spaces)
Twitter Tune-up: Register for Twitter and get tips from top tweeters
Social Media Monitoring Set-up: Learn about free monitoring services and get help signing up for one of them.

Check Out the Full Line-up at Windy City Social

Or REGISTER NOW!

MIT Enterprise Forum – Chicago Whiteboard Challenge 2009

2009-06-18T08:33:00.010-05:00

Entrepreneurial Innovators Take to the Stage

Part One: The Winners

Tuesday, June 16, 2009

Ten entrepreneurs presented their five-minute pitches in an effort to win the top prize of $3,000 in the MIT Enterprise Forum’s annual Whiteboard Challenge. The top three presenters won $3,000, $1,500, and $500 in prize money from sponsor law firm K&L Gates.

There were about 90 entries this year. A panel from The Big Idea Forum preselected the ten finalists. Last year’s Whiteboard Challenge received entries from approximately 60 entrepreneurs.

The Winner: TiltAlign Therapy for Cerebral Palsy

This year’s winning entrepreneurial idea, as selected by a panel of four judges and a phone-in vote from the crowd, was Northwestern student, James Rein. Rein’s winning concept was called "TiltAlign", a therapy for people with cerebral palsy.

Rein, a Biomedical Engineering student at Northwestern stated that there are 800,000 people with cerebral palsy in the US. One of the symptoms of the disease is that patients have poor motor control and poor perception of where they are in space. Their spine and extremities get tilted from vertical and movement becomes difficult and strenuous.

This symptom of cerebral palsy is generally treated by physical therapy. One of the more common treatments is to teach them to move in a six foot cage, as seen in these videos. Rein pointed that the efficacy of "cage therapy" for cerebral palsy is "just OK" and the cage itself costs five- to six-thousand dollars and is too big to fit in most homes. Thus the patient doesn’t have frequent access to the therapy.

Rein’s TiltAlign concept is to provide a more portable feedback mechanism to provide feedback to patients when they are misaligned. The device he described uses 1) a device with an accelerometer (the electronics that tell when an iPhone or Wii controller is moving), 2) attached to the chest, arms, or legs by a Velcro strap. The controller communicates to 3) a transceiver which controls 4) a device, either a DVD Player or Music, so that music or video instructions pause when the patient becomes misaligned during therapy.

The TiltAlign concept provides rewards for maintaining good habits and provides instant feedback. It can be used at home and the controls would have adjustable sensitivity, customizable for each patient’s needs. He estimated that the cost of each unit would be $200, compared to the thousands for the "therapy cage".

My question, prior to Rein's winning the prize, was to ask why this couldn't be a software solution built on Nintendo's Wii platform?

Second Place: The BFF <3 Necklace

The second-place prize of $1,500 went to Avelo Roy, who presented eMotion’s "BFF ‹3 Necklace". Roy said eMotion’s vision is to serve people who are physically separate and emotionally connected. Roy is also no stranger to entrepreneurial competitions, the eMotion team won $25,000 in November at Entrepreneur Idol, held at Northwestern University.

There are 8 million "tweens", girls between the ages of eight and thirteen. 27% of them participate in online social communities. These girls are three times more likely to be the victims of cyber bullying or pedophiles. eMotion’s product, the $29.99 BFF<3 Necklace gives people a way to add friends in person. Once matched, you can share private messages and communicate via the necklace. CNN.com describes the "BFF ‹3 Necklace" as "a wireless communication device that takes the form of a fashion accessory."

The BFF Necklace is heart shaped and has color LEDs. The units are encoded so that friends who share necklaces can join each other’s networks. They can send messages that are conveyed by coded configurations of the blinking LEDs and they can exchange private messages on the eMotion web site.

The actual use of the BFF Necklace wasn’t clear to many audience members (anecdotally), nor was it clear (to me) how this product could protect from either cyber bullies or pedophiles. However, the company has assembled an impressive board of advisors, is selling an introductory product, and, according to Roy, the site is "becoming a destination" for their target audience.

Third Place: Portion Controlled Dinnerware

The third-place prize went to Thu Nguyen, who brought to the competition a simple, practical entrepreneurial idea: Portion Controlled Dinnerware. "For as long as I can remember, I have been dieting," said Nguyen in her opening.

After many diets, Nguyen was diagnosed as being "pre-diabetic". She was put on a special diet that required counting points – "I had ten choices per day, compared to the twenty to thirty choices I was eating before the diagnosis." She started measuring her portions, especially when eating carbohydrates. This meant that when she dined with friends, she had to take her portions in measuring cups. It was both complicated and stigmatizing.

Nguyen’s entrepreneurial solution to this situation was to conceptualize dinnerware that integrates portion control into the design. The designs on the bowls and plates clearly and artistically identify half-cup and one-cup servings. Nguyen envisioned, on the whiteboard, a wine glass with portion control markings for eight or sixteen ounces, much to the amusement of the audience. Her concept enables portion control to be managed without having to pull out measuring cups.

Food can be attractively served without the extra, potentially embarrassing, step of measuring when serving. Nguyen placed in the competition with a simple solution to a non-obvious, but frequently recurring problem.

Those were the winners. Over the next couple of days, I’ll provide a write-up of the other seven entrepreneur’s presentations from the 2009 MIT Enterprise Forum Whiteboard Challenge.

Google Analytics presentation to Joomla Chicago

2009-06-09T12:57:00.005-05:00

The slides from Avery Cohen's talk on Google Analytics to Chicago's Joomla User group are now on line. The talk used actual results and Google Analytics screens from the run-up to the CMS Expo that recently took place in Evanston. The talk was well-received and generated a lot of discussion. Dig in!

Put Ad on Web. Count Clicks. Revise. (as simple as that)

2009-06-01T15:48:00.003-05:00

A piece by Stephanie Clifford in Saturday's New York Times business section is finally addressing the data revolution in online ad buying (comparing the analytics to Wall Street's, which may impress fewer folks than it would have this time last year). Major takes: it's faster and simpler to understand ad effectiveness than it ever has been, and the prevalence of ad network cookies is raising privacy concerns.

Innoviation Authors Panel - MIT Enterprise Forum Chicago

2009-06-01T10:06:00.003-05:00

I took a lot of notes at the MIT Enterprise Forum Chicago meeting on May 20th. The meeting was both inspiring and informative. Four authors of books on the topic of “innovation”, all of them consultants for companies of varying scale, answered questions about their approaches to bringing creativity to business. They addressed product and process innovation, in theory and practice.

Alexis Driscoll, a Principal at Outpoint Consulting, was the moderator, and asked about a third of the questions. The rest were provided by the audience, which kept the audience engaged and the conversation lively. The authors were:

Adam Hartung, author of “Create Marketplace Disruption”
Sarah Miller Caldicott, author of “Innovate Like Edison” and granddaughter of T. A. Edison himself,
Craig Hickman, author of many more than a dozen business books and recent author of a mystery suspense novel with a business setting,
Praveen Gupta, editor of Editor-in-Chief, International Journal of Innovation Science and author of "Business Innovation in the 21st Century".

INTRODUCTIONS

Gupta talked about trying to create “Breakthrough Innovation”, he wants to bring out the brilliance in everyone. He wants you to let out “your inner Einstein.”

When asked why his latest book is a novel, Hickman said “Sometimes you can only tell the truth in fiction.” He cited a highly litigious business world that is also, in his words “highly corrupt”.

Caldicott echoed Gupta’s comments, “every one is innately creative.” The challenge is to unleash people’s talents to move science forward. To do that you have to understand who has the skills to create and, just as importantly, to connect with the resources to implement.

In his opening remarks, Hartung was more bold. “If people continue to follow the ‘core and focus’” message that has been so popular in recent years, he foresees “massive failure.”

WHAT WOULD YOU DO IF YOU WERE CEO OF GM?
Gupta was eager to take on this one. He referenced Tom Peters “If you can’t change, you have to kill it and start over.” He referred to the “trash value” of GM’s R&D. GM has the wrong focus, you have to commit to growth and not just profit. “The rest of the world is cheaper than us.” Honda is known for innovation, Toyota is known for reliability, Volvo for safety. “US car brands are known for nothing”.

Caldicott agreed, saying that in her observations there is “no passion for cars at the senior levels. No connection between management and people who assemble cars.” It may be a contractual issue, but union members are not utilized to find better ways to make cars. She came back to Edison, who she says “knew the factories and was passionate about what he made.”

SHOULD YOU KEEP YOUR IDEA SECRET, OR SHARE IT?
Gupta quipped “Bill Gates said the life of Intellectual Property is equal to that of a banana.” He advocated for “open innovation”. Caldicott suggested that people need to find your communities who can help you develop your product.

WHEN DOES INNOVATION BECOME CORRUPTION?
This question was right in Hickman’s sweet spot. “It happens all the time. Deceit, abuse of power.” Innovation becomes corrupt when it becomes all about the competition. When the focus is on competitors and not on customers. True innovation builds solid advances in products and services. Maneuvering against the competition is false, not true innovation.

An audience member asked if Hickman’s test was “focusing on the competition vs. focusing on core competencies?” and Hickman agreed. Hickman recommended article Managing Our Way to Economic Decline, http://hbr.harvardbusiness.org/2007/07/managing-our-way-to-economic-decline/ar/1.

WHEN AND HOW DO WE DRAW THE LINE BETWEEN INVENTION AND INNOVATION?
Edison was known as an inventor, not a “scientist,” said Caldicott. He believed “utility is success.” Invent something and it will sit on a shelf. Edison preferred to take inventions out to the marketplace. That said, Edison was always doing basic scientific research, asking “How does it work?” Edison always combined the basic science with Applied Research.

Caldicott went on to describe how most institutions separate basic research and applied research. “Research” and “Development” are not together and, she said, “need to be together.” She identified three distinctions that need to work together: “Creativity” is having an idea. “Invention” is when you make something. “Innovation” is when it sells.

HOW DO COMPANIES CREATE AN ATMOSPHERE FOR INNOVATION WHEN SO MANY ELEMENTS CONTRIBUTE TO RISK?
Hartung says that the only way to innovate is to set up a separate place in the organization to develop innovation. He gave the example of GM’s electric car program. The people testing loved the cars. GM had to sue to get the cars back from the testers. But when the project came back to GM, it didn’t meet GM’s requirements and was terminated. Hartung’s take was that this project needed to stay in the “white space”, so that they could start from scratch and "fail until you succeed".

Gupta added that “failures do cost money”. Projects need a scorecard optimized for profitable growth and a will to overcome failures. The CEO must inspire people to do their best, managers must create structures for success, and employees must be free to innovate. Management must give room for innovation.

HOW MUCH WHITE SPACE DO YOU NEED?
Hartung said that IBM’s PC development lab at Boca Raton was a success. Xerox PARC failed because it lacked one of the skills Caldicott had touched on earlier, the ability to connect the “invention” with the business’ go-to-market capabilities. Argon and most U.S. basic research facilities fail.

Hartung’s objective is marketplace disruption. For big companies, the business process is locked-in. They can easily expand and do variations on a theme, but they can not change the underlying process. Thus, Xerox PARC ended up giving away the Graphical User Interface and Local Area Network technology that was developed there. They could not innovate into a completely new field. Caldicott said that Edison would sell off discoveries or inventions that he did not see his company taking to market.

Hartung says he has 10 rules for strategic innovation in his book. The “whitespace” company needs to come back and “eat” the parent company. Actually, it’s the people who need to be innovators, people willing to disrupt. He pointed at Hospira, the Abbott spin-off, as having a good mix of people willing to disrupt their processes. Caldicott talked about businesses having a mix of characteristics relative to innovation, and that it tends to be a bell curve. 10% looking to try or make new things, 10% looking to make our things better and 80% looking to be followers of defined “best practices”.

Hickman brought up a concern about the dogma of “Control or be controlled”. This works in promoting “best practices”, but fights innovation. It creates corruption in hierarchies where people have bought into being the followers.

Speaking of corrupt hierarchies,
ILLINOIS POLITICS: CAN WE INNOVATE OUT OF THE PAY-TO-PLAY ENVIRONMENT?
Hartung says that business has fewer rules, but just as GM can’t innovate from the inside, neither can state government. The federal government will need to come in and change the game. Others agreed.

ARE THERE COMPANIES THAT ARE TOO BIG TO FAIL? CAN BIG COMPANIES INNOVATE?
The question used the term “sustainability”, which some people took to mean “sustained growth” and others took to mean “environmental sustainability”, often called “green business”. Gupta took the lead on the question, and split the difference, giving the example of how Ford spent a lot of R&D money on “green” and sustainability initiatives for their cars and facilities, but didn’t know how to build new cars, only to adapt. GM, he said, “stands for Greatly Mature. Their time is gone” GM has a 5% success rate with innovation. Today, companies need to create, to manage for disruption, to innovate fast, in real time.

Not all companies can sustain innovation. There is a culture and there are structures. Caldicott discussed four models for innovation:
1. Compliant – “I will innovate if the market makes me”.
2. Dabbler – Creates teams to dabble in innovation outside core functions of the business.
3. Continual Improvement – Six Sigma adherents, incremental improvements
4. Innovative Enterprise– Constantly open to change and innovation across the enterprise.

She gave the example of the rare Innovative Enterprise as Edison’s West Orange Laboratory.

Hartung says that the problem for big companies is that their focus on profits. “Profits are result.” You need to innovate to solve problems, not maximize for profits. “When you look only at profit, you do stupid things, like selling all the parking meters at one time.” Profit squeezes are not sustainable.

HOW IS THE INTERNET AND SOCIAL MEDIA CHANGING INNOVATION?
Caldicott says that the new medium is opening collaboration to occur across the world. Companies need to harness the concept of Open Innovation and develop competencies. She referred to 3M studies on how their scientists interact on social media. They have a mandate to share information across scientific and marketing audiences. They can see clusters of information and see who the connectors are. About a dozen people are the core glue that keeps people connected and information flowing.

Gupta says that this approach has changed the whole innovation process. The building blocks of innovation are moving from big companies to smaller groups of networked individuals. Companies that understand this get the benefits. For 3M, it takes six years to get a return on investment. For Google and Apple, it is just over a year. For Nintendo, ROI is $ 3.50 – or around 90 days. And, he added, “for GM, never”.

HOW CAN PEOPLE INNOVATE ON BUSINESS PROCESSES?
Caldicott talked about the World Innovation Forum earlier this month (May 5). Business Processes played a big part in that discussion. She believes that businesses will move from a pyramid to a flatter structure. Generation Y will be the largest population on the planet. Next year Cisco will employ more Gen Y than Baby Boomers. Gen Y is more collaborative and engages in “horizontal collaboration”. This will give rise to more business processes to share information about markets and products, needs and uses.

Hickman added that hierarchies are easily corrupted because of a concentration of power. The power has to be dissipated and shared. Corruption is hidden. People must be empowered for innovation to take place. This is also critical for democracy to work.

WHERE DO YOU SEE THE ROLE OF GOVERNMENT IN INNOVATION? IS IT COMPATIBLE WITH THE U.S. CAPITALIST APPROACH?
Caldicott pointed at Argon labs. Their mandate only allows them to go to a pre-commercial phase. Thus, Argon’s battery technology ends up only at Toyota. Argon needs to open up. Their charter needs to change, though she didn’t say to what.

Gupta talked about four types of research:

1. Fundamental Science, done by universities and government
2. Platform Research, done by the largest, though sometimes mid-tier, companies
3. Derivative Development, done by most companies
4. Variations or Incremental, done at the individual level

If we want innovation, teach people to ask questions and to be creative. That value on creativity and innovation comes from governmental programs.

LARGE CORPORATE MANAGEMENT HAS SHIFTED FROM PEOPLE WITH ENGINEERING BACKGROUNDS TO MBAS. HAS THIS RESULTED IN THE DEATH OF INNOVATION?
Hickman responded that the rise of entrepreneurs is critical to innovation. “Control” has become an extreme dogma and closes opportunity. The biggest obstacle to innovation is management.

As a final note,

WHAT SINGLE MYTH ABOUT INNOVATION WOULD YOU LIKE TO DISPELL?

Gupta: We think people are not creative. This is not true. We are all born creative. Learn to challenge the status quo.

Hickman: Not all innovators are the same. We mostly do just a passable job of putting the right people in the right places so that we can use all available talents.

Caldicott: It is not true that innovation takes a lot of people. A great team is 3 to 8 people. Not 25-50. A team of three people invented optical fiber. Their competition was a team in Japan had 50 people and failed.

Hartung: It is not true that innovation comes from deep knowledge of a subject. Deep knowledge leads to incremental improvements. Innovation comes from lateral thinking.

And that's quite enough from me. As always, please contact me with any questions or corrections.

SPARKt = Chicago Real Estate + Technology

2009-05-15T23:25:00.003-05:00

Kit Mueller runs REConnect, featuring an on-line networking and events for Chicago real estate professionals. Mueller and also holds twice-yearly SPARKt conferences on Real Estate and technology. The second Chicago SPARKt conference was held April 29 in the Volcano Room at the Bottom Lounge in Chicago's West Loop, with a half-dozen relatively quick high-quality presentations. Muller kept the proceedings on-target (with occasional coaching from the peanut gallery) and the atmosphere upbeat, casual and informative.

There was a good sized crowd, made up primarily of Real Estate professionals, including agents and brokers as well as various online real-estate related web sites and a handful of other service providers. Highlights included
- Matt Dollinger from @properties on Real Estate use of online social media
- Michael Berger, 37 Signals' iPhone geek talking about mobile applications for Real Estate
- Christian Sterner of Welcomemat.com demonstrated how to make online video effective
- A discussion on "Privacy and Social Media" from lawyers Glenn Manishin of Duane Morris and Brock Meeks from the Center for Democracy & Technology
- Eric Bryn talked about how he uses Web Analytics to help realtors come up with blog topics.
- Adrian Holovaty from Everyblock talked about the future of Everyblock and its local data technology.

Matt Dollinger's blog, The You Factor, helps Realtors understand how to use Social Media. The crux of Dollinger's message is to put yourself, personally, out there. Dollinger puts a Real Estate frame around some of the concepts discussed online by Social Media thought leaders like David Armano and Peter Kim (both of whom he referenced in his talk). When you are online, you are not "selling", but building a "personal brand" that shows you to be someone who can help people when they need to make a complex and emotional decision.

Christian Sterner expanded on Dollinger's "personal branding" message, showing how Realtors can use online video not just to show homes, but to become an online presence for all things local. Post videos on YouTube & Yahoo for search engine optimization (SEO) effects. Sterner also suggests using Social Media sites to announce and embed your videos, as an opportunity to connect with people where they are online.

Michael Berger, a former "Apple Genius" who focuses on mobile applications at 37 Signals, demonstrated mobile applications on the iPhone that Realtors can share with clients. Apps from Zillow, Trulia, and Everyblock take advantage of the iPhone's GPS capabilities to show local real estate information on maps. You can see your current location and nearby homes for sale, and other local community information.

Brock Meeks from the Center for Democracy and Technology was perhaps the highlight of the afternoon. A former big-league journalist, he and Glenn Manishin discussed some of the legal issues around on-line social networks. Meeks talked about the process of hiring a Social Media Manager for the Center for Democracy and Technology. He looked at their Facebook and Twitter posts; many candidates demonstrated an "personal brand" that was not consonant with the mission and values of the Center. They also warned that what you say on Facebook or Twitter could become a binding addendum to any existing contract. So be careful out there!

Eric Bryn showed how to use Google Analytics and a few other tools to capture new audiences on the web. He manages several group blogs for realtors. He looks at the blog contents and uses Google Analytics to discover the "organic" search keywords that are used to reach blog entries. If he sees a spike in activity, he knows that there is a good opportunity to use those terms again. Google Analytics also reports if site visitors read more than one page or register for email newsletters.

Bryn also looks at the terms used in entries, and finds synonyms through the Google AdWords Traffic Estimator. This shows synonyms and approximate value for those terms if one was to advertise on the topic. Microsoft offers adlabs.microsoft.com, a tool that shows keywords and relative intent-to-buy associated with usage of those keywords.

Once a valuable keyword that drives traffic is found, Bryn encourages his clients to write "variations on a theme" using the keywords as topics. He used a visual of Andy Warhol’s Campbell’s Soup Cans. "7 tips for...", "What not to do when buying...", video and photographs.

Adrian Holovaty talked about the Everyblock iPhone app. With iPhone GPS capabilities, you can see crime/health/news reports for your current location. Holovaty also talked about how Everyblock.com was created under a grant, and under the terms of the grant, the Everyblock code, built on the Django platform, will become open source this June.

There were a lot of very practical gems in the SPARKt conference. With the exception of Meeks & Manishin's talk, the focus remained solidly on Real Estate, though the advice was easily transferrable to other high-touch services. Photos from the event are at SPARKt website. Mueller continues to run frequent RE-Connect events.

Is SEO the "goal hanger" of Internet marketing?

2009-05-14T16:05:00.004-05:00

Karl Havard in the British Internet periodical "Econsultancy" uses a football ("soccer", to you NFL fans) metaphor to make a point about all of the other things, besides good solid SEO, that we Internet marketers need do to "score" success. A "goal hanger" is a player who waits just outside the box around a football goal, hoping to deflect the ball that others work so hard to advance. To Havard, we focus too much of our efforts (especially monetary ones) on SEO, while shorting, for example, the conversion elements on our site that make SEO pay off, just as football fans give too little credit to the players who worked so hard to get the ball to the "goal hangers". The algebra of success is Site Entries times Conversion Rate, and the return on conversion investment is often "misunderestimated", as former President Bush would say.

Google Analytics goes multi-dimensional, and more

2009-05-08T11:54:00.004-05:00

News out of eMetrics San Jose: Brett Crosby of Google Analytics announced new features for Google Analytics, including Pivoting and Secondary Dimensions, so that we can look at the relationship between two dimensions at once; Share Custom Reports and Advanced Segment Customizations, so I can port custom report structures I've built, and new ones now being made available, into other GA accounts via a URL; Manage Customizations Across Profiles, to do just what that says, especially useful if some custom reports would be nonsensical for certain profiles. Expect to see these over the next few weeks.

Business Network Chicago Venture Capital Panel

2009-04-21T23:41:00.005-05:00

April 7, 2009

Four interesting and innovative companies presented their concept pitches to the monthly Business Networking Chicago Venture Capital meeting. Hosted by Len Bland and David Carmen, the attendees included entrepreneurs, service providers, students and perhaps a half-dozen actual investors.

The companies presenting at BNC Venture Capital are generally early in the cycle of seeking investment, and both participants and audience have an opportunity to learn how to make their business case to potential venture capital investors. Each speaker is given ten minutes to present and fifteen minutes to answer questions from the crowd.

Moderator Bland asks them to make sure they answer three questions: 1) What is your product or service and why will customers buy it? 2) Why is the management team qualified to execute the business plan? 3) How will your investors make money?

Of the four companies that presented at the meeting on Tuesday, April 7, 2009, two were related to education; One was an innovator in sustainable (e.g. "green") transportation options; and one offered to transform the manufacture and distribution of a common retail product.

INNOVATE2LRN – Dedicated Workstations for Urban Students

The first company, Lake Forest based INNOVATE2LRN, branded as QWK2LRN provides "thin client" computers to urban schools, with the objective that each student have a working computer at their desk full time. They provide hardware and infrastructure utilizing on-demand remote (or "cloud") server capacity.

It was interesting that the audience did not have a clear understanding of the Innovate to Learn's business model. That their service is related to providing computers and a "cloud-based" infrastructure to schools. This may be because QWK2LRN CEO Bill Lowe focused much of his presentation on the efficacy of having a dedicated computer workstation for each student in urban schools. He then recommended that the schools use web-based educational programs; the QWK2LRN solution does not provide software or teacher training, though they do have one person available to consult with teachers and administrators on selecting appropriate web-based educational programs.

A key to QWK2LRN 's business plan is that the management team works with school district superintendants to get access to already-allocated federal funds to pay for the hardware. The core team is made up of executives from Xerox, they bring Xerox's top-down approach to sales. The executive team has built strong connections with philanthropists who are active in urban and educational causes. This has given them access to school district superintendents rather than going in through the IT department. We note that, at this writing, their web site is "undergoing site maintenance".

SCHOOL TOWN – Web-based Teacher-Parent-Student Communication Platform

The second education-related company to present at the BNC Venture Capital meeting, School Town, provides tools to help teachers, students, and parents communicate about school assignments and schedules. School Town also provides capabilities for teachers and parents to collaborate and share lesson plans and other educational information. School Town CEO Michael A. Kritzman also stated that School Town provides a platform for teachers to implement "differentiated learning" in the classroom.

Based out of the Chicago suburb of Glenview, they have had successes with their initial installations. The solution helps teachers and parents communicate with students, and helps students develop time management skills. One concern of the audience was whether competition in the education marketplace represented a good opportunity for the company to be acquired for integration or if the company could succeed as a stand-alone SaaS offering. Kritzman indicated that their strategy is to develop the product and be acquired. Another question from the audience was how much time School Town would save teachers versus the complexity it added to their jobs.

PARRY TRANSIT – Ultralight Rail Using Hybrid Power

Parry Transit is an American subsidy of a British company that developed the hybrid trolly. They offer a sustainable ultralight rail solution. CEO Barry Seifer described ultralight rail as an affordable green transit technology. Light rail has a 10-year sales cycle, but ultralight is less expensive for both the track and cars and can go to market more quickly.

Despite Mayor Daley's repeated tries to build light rail in Chicago, this Chicago audience could not relate to the Trolly concept, asking if they could put tires on the cars. Unfortunately, that would eliminate many of the benefits of the Parry Transit system. Light rail has enjoyed success in other locations, including downtown Portland as an outstanding example.

On one hand, with federal stimulus dollars on the table, Parry's ultralight rail looks like an appealing investment. On the other hand, high-speed rail for the Midwest has been getting the PR buzz lately. A lot of Parry's success rides on managing all aspects of selling to government, including setting public expectations.

NOVUS ICE SYSTEMS – On-site Ice Production for Retail Locations

Chicago-based Novus Ice proposes to "redefine the distribution chain for bagged ice" in retail locations by placing automated systems in stores. The systems run quietly and have the same footprint of current ice vending systems, with added height.

The manufacture and distribution of ice is typically a local monopoly, with some 2,000 suppliers nationwide. There are two large public companies trying to roll up this market: Reddy Ice and Arctic Glacier. Novus' business model is to finance the placement of the systems and take a percentage of sales from each unit. They will guarantee the retail price of a bag of ice. Eliminating the manufacturing and transportation costs of ice should improve margins on ice to around 20%.

The machines use standard components, assembled for Novus by the hardware suppliers. The makers of the freezer units have an existing nationwide maintenance operation, which Novus says will minimize the exposure of the maintenance risk.

The use of standard components raised the question of competition. Novus said that there is no competition currently in the market and that their projections are to take 4% of the retail ice market, focusing on chains with larger stores. Their business plan showed 64% EBITDA at the end of five years. They are in the planning stages for a pilot with Walmart.

Note, however, that a later Google search for "in-store ice production" yields a February announcement from Arctic Glacier of their in-store ice production system, and another system from Louisiana based Ultra Pure Water Technologies, dating back to November, 2005. (see http://findarticles.com/p/articles/mi_hb5559/is_200102/ai_n22604092/ and http://www.upwt.com/icemakers.html ). It appears that there may be more to the story behind this innovation. If I were Ron May, I'd probably take up the space to also point out that the management team is not listed on the company's web site.

FEEDBACK FROM THE CROWD

At the end of each presentation Bland polled the audience to vote their confidence in the presentation's investment potential on a scale of one to ten. Novus Ice Systems was the best received of the companies presenting. School Town received the most tepid support from the audience. Parry Transit appeared to have the widest dispersion of low-to-high votes.

The next Business Network Chicago Venture Capital meeting is Tuesday, May 5.

Good news for Zillow, Trulia, Bad News for Realtors

2009-04-05T23:07:00.004-05:00

Real estate web sites Trulia and Zillow are both reporting growth, according to Search Engine Watch. Truila announced record growth in March, while Zillow announced an agreement to build co-branded real estate web sites for a consortium of 180 community newspapers. This makes Trulia and Zillow increaslingly important resources for realtors.

Compete.com shows significant growth for both Zwillow and Trulia over the past several months, as shown below. We note that Compete's panel does not conform to Trulia's reported Q1 growth, at lest reporting through February. By comparison, Google Trends reports relatively flat search traffic on the terms "real estate" and "homes for sale". It would appear that Zillow and Trulia are taking market share from other sites, perhaps the sites of realtors themselves.

What does this mean for realtors? We expect it's going to be increasingly difficult to draw people to the realtor's web site. Given that, realtors have an oportunity to engage with potential buyers and sellers on Zillow and Trulia. There is also an opportunity to focus locally and build online reputation through a variety of social media sites, including Facebook and Twitter.

It's going to be up to the realtors to find their customers online and to connect with them where they are. Customers are searching for "real estate" or "homes for sale", but they are increasingly searching out "zillow" and "trulia". Trulia's blog talks about Trulia's presence on Twitter.

Trulia is chasing Zwillow for real estate shoppers. The opportunity is for realtors to become even more nimble. One strategy is to connect ubiquitously to their own local communities as real estate clients, homeowners and potential homeowners, become more connected online.

The Uses of Social Media in B2B Communications, a panel discussion

2009-04-02T00:31:00.004-05:00

Social Media Club Chicago, March 26, 2009

Social Media Club Chicago had a crowd of approximately 225 last week at The Chicago Mercantile Exchange for an evening of The Uses of Social Media in B2B Communications.

The high point of the panel was when Ellis Booker worried that "people are doing the right things for the wrong reasons." Marketers are using Social Media "not because it is effective, but because it's cheap!"

To extrapolate on Booker's comments: At this stage, most marketers using Social Media are not measuring results, but activity. Social Media becomes 1) an inexpensive focus group, gathering anecdotal evidence from an unorganized stream of information, and 2) an extremely cheap publishing platform with occasional flashes of brilliant or break-out success. Of course, it doesn't have to be that way.

The CME group has made a video of the event.

The SMCC is organized by Barb Barbara Rozgonyi. The event panel was assembled by Jeff Willinger. Great food from Rivers, in the CME building.

Len Kendall, Media Manager, Critical Mass, moderated a panel of:
Allan Schoenberg, Director of Corporate Communications, CME Group
Ellis Booker, Editor, BtoB Magazine, Crain Communications
John Fairley, Director of Web Services and Social Media, Walker Sands Communications

My lightly edited "summary" of the panel:

What are the differences between B2B and B2C on Social Media?
Booker says that "B2C is easy." B2B is a longer process. In the time he has been at BtoB magazine, he has seen a change, "the playfulness of campaigns has ramped up... having more fun."

CME Group's Schoenberg pointed that the B2B audience is smaller and that the value proposition needs to be stated more strongly than in B2C. While Fairly said that "more people are involved in the sale and decision." Social media allows you to reach those people at different points in the decision process.

Booker says that corporate Social Media presence is becoming an expected part of doing business. Fairly says that people will move toward companies who are active in Social Media because they will be perceived as being more available and transparent.

What tools are you using to manage Social Media presence?
Fairly likes free tools that track history, suggesting "SM2.com", "Social Mention" and "Blog Tracker". Schoenberg likes tools that track what people say about the commodities market, and uses "Vocus". Fairly suggested using Twitter Search to monitor mentions of your brand and related terms.

Tools like TweetDeck and PeopleFollow let us filter the conversations and focus on relevant content.

What are ways we can drive traffic using Social Media?
Fairly talked about the relationship between Search and Social Media. You need to understand the tools of Social Media. Study the networks and see if your customers are there. Are they on LinkedIn, Facebook, Twitter, or other niche communities? Listen to your customers on the site. What are their pain points and interests. You have to follow social norms, understand the audience. Then establish key relationships. Later you can tweet to the masses. "Our strategy is to tweet about a pain point to a 'maven' in the community, who re-tweeted our comments."

Booker says you have to focus on why you are doing Social Media. He gave an example of a "sandbox" community site created by a company. They wanted to do a six-month trial, but 18 months later, they had 400 of their best customers actively engaged and had no choice but to keep up that test community, even though it wasn't part of their media strategy.

Later, Booker also said that they are "listening more with Social Media. We use the Social Media infrastructure to listen and decide what to report.

Schoenberg's guideline is "C-squared": Content x Community. Keep driving new content into the community, then engage in conversations. He used LinkedIn, then Facebook and talked about cross-pollinating the venues.

Where is the revenue?
Schoenberg had some anecdotal examples. "We have brought in leads for our brokers, and now they are trading." But he acknowledged that Social Media has been less money and more time. However, he says they have 52K followers on Twitter.

Fairly pointed out that Paid Search has set a standard. It's very measurable, but Social Media doesn't correlate directly to revenue. There is a story to be told: how many influential bloggers linked, some new leads, increases in traffic. Viral media brings traffic from everywhere, so you have to look at cumulative effects.

Booker worried that "people are doing the right things for the wrong reasons." Marketers are using Social Media not because it is effective, but because it's cheap!

To extrapolate on Booker's comments: At this stage, marketers are not measuring results, but activity. Social Media becomes an inexpensive focus group, gathering anecdotal evidence from a disorganized stream of information, and an extremely cheap publishing platform.

What metrics are you using? How do we gauge expectations?
Schoenberg said CME Group's Social Media efforts are part of an overall marketing strategy, "it has to fit into everything else we do. If it's just an island, you are going to fail."

Booker pointed out that E-Marketer magazine forecast on-line advertising would grow by 53% this year. Now, they are saying growth will only be 10%. At least, he concluded, it's going up. Unlike print advertising.

Are there ethical guidelines companies should be following?
Schoenberg brought up Digg as an example that Social Media can be gamed. Their biggest concerns were legal. Let people know you work for the company.

Who is in charge of your Social Media Presence?
Last year, the buzz was "you are no longer in control of your brand." You don't know what people are doing until you listen and hear or see for yourself.

Both Fairly and Schoenberg said you need to manage the message, educate your internal people to get a consistent message. Schoenberg expressed a need to manage the message and to be clear about who is the official voice for the organization.

How do you manage the volume of messages and the 24x7 nature of Social Media?
Booker stated that it is important to get right back to people. Fairley said that they "co-Tweet", having a collaborative Twitter account. Schoenberg uses "TweetLater" to schedule messages to drip out into Twitter. Fairly said that "Social Media is like adding another phone to your office, and you have to answer it."

But Fairly also brought up the most important thing you can do with Social Media: Identify people who are most passionate about your product or topics, engage with them, and activate them to be your advocate.

Web 2.0 and How It Can Promote Your Business: Chicago MIT-EF March, 2009

2009-04-01T14:34:00.004-05:00

Web 2.0 and How It Can Promote Your Business Chicago MIT-EF: Jason Fried (37 Signals), Harper Reed (Threadless), and Howard Tullman (Flashpoint Academy) Talk About Social Media and Your Business

Chicago MIT-Enterprise Forum, Tuesday, March , 2009

Introductions
Fried's 37 Signals provides personal and business productivity tools through a Software-as-a-Service model. Fried describes this as "freemium," basic versions of the tools are available for free, and people can buy enhanced services.

Reed is CTO at Threadless, which uses a "crowdsourcing" model to produce t-shirt designs. Each week, there is a competition of designs and the winning designer gets his shirt made, some cash and store credit percentage of sales. They have developed a community of designers and consumers over the past ten years.

Howard Tullman is CEO of Flashpoint Academy is an entrepreneur in the field of education. Tullman says that properly run, education can be productive and profitable.

What is Web 2.0?
Fried: The Web 2.0 concept emerged in 2004 – 2005, as a buzz-word centered around user generated content and small team development. There was a Web 2.0 aesthetic: gradients, pastels, and reflections.

Reed: All of our products and content are developed by our community.

Fried: We are very focused on small business tools, all are web based. Our products do a few things, do it well, and get out of the way.

Tullman said he sees Web 2.0 as being search driven, with the next step from there being user generated content.

Further reading: see Tim O'Reilly's definitive 2005 article.

37 Signals & Threadless: Web 2.0 Practitioners
Fried was concerned that one aspect of Web 2.0 was business models. He pointed out that 37 Signals and Threadless represent two profitable web-based companies. Reed said that's because they offer something for sale, an important step toward profitability.

Fried pointed out that their "freemium" model (a term coined by Fred Wilson, VC from Flatiron Partners) starts with free services and adds paid modules. "Start free, then charge." Basecamp, a collaborative project management tool to help organize stuff you might otherwise email, has 3 million users. The majority of their customers only use free services, the minority is paid and they are profitable.

Reed described the relationship between Threadless and its community. Many of the Threadless designers have grown up with the company. They have interacted with the customer community. The interaction between customers and designers has resulted in sales of 100K shirts per month, one million registered users and 200K active users. Their community recommends new features and helps identify bugs as they enhance the software that runs the site and design tools.

Web 2.0: Beyond the Web Site
Reed had a presentation showing how Threadless uses other sites as opportunities for interaction. They have found that their community likes to interact with the Threadless development team. One of the Threadless team, Charlie, has a video blog on Vimeo, where he will have a video blog entry and results in interactive discussions in comments.

Reed pointed out a competitor's advertisement on the Threadless video page on Vimeo, a competitor that is owned by Viemo's parent company. Which may explain that while 37 Signals was kicked off of Vimeo for posting "commercial content", Threadless is allowed to post new video content that talks directly about the company, its products, designers, and community.

Threadless also uses Flicker to promote their site and products through user-generated content. Customers get a point, worth about $1.50 in store credit, for every picture posted on Flickr of someone wearing a Threadless t-shirt.

Web 2.0: Twitter and Customer Service
On Twitter, Threadless was "somehow put on the 'suggested users list'" and in two weeks went from 9,000 followers to over 150,000 followers. These people receive messages from Threadless in their Twitter message stream.

37 Signals has been on Twitter for a few months and figures they have around 11K followers (Fried has 8.5K at this writing and the Twitter account 37signals has 13.3K).

The value of Twitter is that its search mechanism is open and real-time. This gives access to what people are saying right now. It creates an opportunity to quickly respond to people, and they will respond to your postings.

A quick response is most effective at winning people over. Tullman talked about the value of "fixing" the situation when a customer has a bad experience. The staff at Threadless hangs out on Twitter, monitoring the term "threadless", and responding when appropriate.

When asked by an audience member about the term "community", and if it is "a real community" or just another buzzword, the panelists acknowledged, in jocular fashion, that the term has become a Web 2.0 buzzword. They also illustrated that there is substantial value that comes from the interactions between consumer and supplier. 37 Signals gains insight into how their products are being used. Threadless has developed a thriving and successful community of designers, along with a very loyal consumer base. Consistency of interaction and sales indicates that there is a value to the "community" these companies have developed.

Other Web 2.0 Tools
Both 37 Signals and Threadless use Campaign Monitor for Newsletters. They like Survey Monkey as a low-cost source of customer attitudinal data. Reed likes Google Apps for collaboration outside Basecamp. Both are making use of Google Analytics and Fried's team is using Google Web Site Optimizer.

None of the companies on the panel has a dedicated analytics team, nor do they employ a Social Media manager. These duties fall to the team to pick up organically in the course of their other duties. For example, monitoring Twitter conversations becomes a part of everyone's job at Threadless, and Reed gave an example of how he got a call from one of their warehouse managers over a weekend, informing him that a feature on the site was broken.

This speaks to the scale of the ventures presenting. When asked by the audience what potential they see for automating the interpretation of semantic data from social media, it was not on their map. For these companies, interacting with the audience is one of the most important part of their business models, but is so ingrained into the corporate culture that there is not a formal process for these interactions.

The Next Big Thing
Tullman asked "What's the Next Big Thing" and Fried took exception. Our industry is too focused on change. He recommended that people focus on things that don't change. Chasing "The Next Big Thing" leads people to lose sight of what is important and successful in their business. Two constants for or his web-based applications: Speed and Ease of Use.

What Are You Investing in?
Fried said that they are not focused on new products, but are improving speed and integrating a suite of their products. Reed said that they invest in their users, focusing on their users and developing use cases that describe the users' needs.

The Threadless parent company "Skinnycorp" has built a new site http://nakedandangry.com/, where they make products like handbags and umbrellas using patterns created by their design community. He discussed the challenges of expanding to new products, that their core competency was in developing software, but expanding product lines has meant sourcing products from China, working on product quality issues, and managing longer lead-times for the supply chain.

Allstate's Social Media Play

2009-03-31T11:13:00.004-05:00

Allstate has released their new viral media play, Friender Benders. This imaginative use of flash animation is reminiscent of Office Depot's highly successful "Elf Yourself" campaign, which ComScore credited as being a primary driver of 150% increases in Office Depot online sales.

I found it easy to use and pretty funny. There are four animations, and you can see the different ones by clicking on the people in the pile-up at the end of the video, which gives it a strong social media kick.

If I Worked for Facebook... I'd Target Outlook

2009-03-20T11:39:00.005-05:00

If I worked for Facebook, I would wake up every day saying "How close are we to replacing Outlook as people's communications and contact management center?"

I'd buy Eventbrite, so that event management and registration would be done right inside Facebook.

I'd buy 30 Boxes, so that events and birthdays would go right on a calendar that could compete with Google Calendar. And I'd integrate meeting scheduler capability like Timebridge.

I'd build a better inbox! And maybe let people pick up copies of their POP email from FB.

And I'd figure out a way to let people tag their contacts, color-coding and filtering views - friends & family & business: clients, active prospects, acquaintances, frenemies, etc. And I'd integrate those views or color codes into the calendar and email functions.

And I'd let people build useful applications to help make Facebook be the place that organizes all people's personal and professional contact information. Of course, if my mission in life was to "organize all the world's information", I'd buy Facebook and implement/integrate the above ideas using my existing catalog of applications.

Google behavioral targeting is the savior of the news and content business because it enables valuation of impressions

2009-03-16T09:57:00.003-05:00

The news that Google will roll out AdWords behavioral targeting is a good one for the content business, and perhaps for many newspapers, to use the old industry term. Behavioral targeting will use some functions of historical clicks of ad viewers to select ad placements. If what is delivered enables a better-than-random data-based valuation of ad impressions, it may provide an economically better predictor of an ad's eventual profit contribution, and so provide an expected online revenue prediction based on impressions and well as clicks.

Discuss, please.