Author Archives: Peter Buechler

A Legend in Its Own Mind

Apple (née Apple Computer) has been doing some high priced promotion to celebrate the thirtieth anniversary of its Macintosh computer. Double page ads with pictures of original and contemporary Macs recently ran on successive days in the New York Times, The Wall Street Journal, The Boston Globe and many other vehicles. The commemoration took over Apple’s home page. Apple acolytes can watch an infomercial featuring almost famous-like types, whose lives were made richer, fuller, deeper, and more transcendent when they got a Mac.

The promotion has all the trappings of a major new product launch, but without the new product. Reruns of greatest hits do not equal great marketing. Taking a trip in the Way Back Machine to 1984, was the original trans-luggable Mac such a success that it should be celebrated today?

In 1984, Ronald Regan was in the White House, but computers were not in the houses or offices of most people. Personal computers, even “portables,” were heavy and expensive. They made up for this by doing relatively little. Out of the box they did nothing but show a blinking cursor on dark screen of a CRT monitor. If you wanted apps with that, an extra $500 or so would get you a spreadsheet or a word-processing program. For some hundreds more, you could get a dot-matrix printer to make an ugly printout of an ugly screen. In other words, the bar for a superior product was none too high.

Even compared with this modest baseline, the early Macs were works in progress. Their implementation of graphical computing ideas borrowed from Xerox PARC was slow. Drag the mouse, and wait for the system to catch up. The original Mac was underpowered, overpriced, and not positioned toward a market, which valued its potential enough to pay a premium for it.

Apple had the graphical computing field essentially to itself at least until mid-1990 and the release of Microsoft Windows 3. With the Microsoft two button mouse, Windows became the first viable mass-market graphical computer system. By then the Mac was a more robust product, but could not sell enough in either the home or business markets to avoid losses. The company suffered near death experience in the mid-1990s, when it fired Steve Jobs.

Apple rallied and survived, yet its later dominance was based on its consumer electronics – music players, tablets, and phones – not computers. This is not to say that Apple isn’t doing well in computers. Gartner estimates that Apple achieved a share of 13.7% of US PC shipments, though in a shrinking market.

In its most recent quarter, Apple derived more than five times the revenue from phones as from computers. This shift has been happening for some time such that in 2007, the company formally changed its name from “Apple Computer” to just “Apple.”

What Have You Done For Me Lately?

The contemporary Mac is a good, if rather expensive, computer. I’m writing this post on one. Moreover, Apple’s OS X software is arguably superior in a number of ways, such as less prone to crashes and viruses. Yet this is old news. Over the last, say, half dozen or more years Macs have not improved significantly, though they have gone through a number of cosmetic changes – all in silver, a bit lighter and thinner, and slightly sharper graphics.

Rather than celebrating a thirty year old footnote, Apple might better use its resources to reinforce what they have done for us lately – even if that means actually doing something for us lately.

What’s Your Model?

A key question any organization, including non-profits, will have to (eventually) answer is what is What Is Your Business Model? How will you fund your operations to stay in the game, let alone prosper? The question is easy to ask. The answer – not always.

You don’t necessarily start with a Biz Model. Disappearing message phenomenon Snapchat has millions of customers and a rumored valuation of $3 to $4 billion yet no revenue at all. Whatever else it may be, no revenue is not a business model.

Similarly, Twitter, after seven years and tens of billions of tweets has yet to approach profitability. Its recent successful IPO gives it space to continue to optimize its business model.

Another increasingly popular phenomenon is online instruction. From rather crude beginnings, such as MIT’s open courseware  – at first not much more than an online syllabus and lecture notes – the online learning platforms have improved and the number of courses increases substantially. These have become complete courses, not just someone giving a lecture on YouTube.

Commentators some times call these online courses by the ungainly acronym, MOOC, as in Massively Open Online Course. MOOCs are created by individual universities but commonly syndicated to students through portals such as Coursera, Udacity, and EdX, which offer courses from many schools. For an overview of the range of online courses see mooc-list.

The courses are generally free. This begs the question – what is the business model? What pays for the software, services, video production, and staff let alone a return on investment? Visitors to MOOCs generally don’t see embedded ads or even offers to buy logo wear or tsatskes similar to what traditional colleges offer. Advertising and merchandising would detract from the platform, without providing enough revenue. A few MOOCs have tried explicitly charging up to a few hundred dollars per course, but the abundance of free alternatives just a click away has so far thwarted a direct pay to learn approach.

Looking at the latest crop of online courses, providers seem to have been thinking about other ways to increase revenue and been evolving from a free to freemium model. Freemium is common with services from online gaming, e.g. Zynga, to web based storage, e.g. Dropbox. Typically, there is no charge to start and you can continue to use a modest amount of the service at no charge. Use more or avail yourself of advanced features and you have to pay.

In the case of online education, refinement of the business model also entails changing the value proposition and the essence of the product. Instead of requiring students to pay for the instruction, MOOCs ask them to pay for verification that they took the course. That is, students pay for some form of an e-certificate of completion. As in the brick and mortarboard world, the product is not so much education as certification.

For example, visit Coursera and the heading on the home page proclaims – Take the world’s best courses, online, for free. However, select a course from the extensive course list at and you’re presented with a choice – “Learn for Free” or “Earn a Verified Certificate.” The certificate costs $49.

Verified certification is but a part of Udacity’s upsell. For about $100 a month, it offers “Udacity Coach.” Students get guidance with course projects and help with assignments. Students, who do not upgrade to Coach, can only ask questions to an online forum, with no guarantee of a satisfactory answer or indeed any answer at all.

EdX, the third major MOOC, seems ambivalent about selling addons. It does offer “Verified Certificates of Achievement,” for variable fees starting at $25 but suggesting that the student pay more. Yet it virtually apologies for doing so with a plaintive:

As a not-for-profit, edX uses your contribution to support our mission to provide quality education to everyone around the world, and to improve learning through research. While we have established a minimum fee, many learners contribute more than the minimum to help support our mission. The funds go towards class creation and improving EdX.

For any of these programs, would friends, relatives, or prospective employers be impressed with a stack of such certificates? How impressed would you be to see not a diploma on the wall, but a tablet with the image of a certificate?

MOOCs might try many other possible business models. What’s encouraging is that they are actively experimenting. When is the last time your organization examined its business model?

Whose Camera Never Lies?

c1860-LincolnAlthough “the camera never lies” is a well worn cliché, we – and  our customers – know it can. Unsurprisingly fakery is in the public consciousness. Coursera, the popular free online university, is currently offering a course with this title, documenting how commercial, journalistic, and historical images have been distorted. A recent exhibit at New York’s Metropolitan Museum, aptly titled “Faking It,” celebrated works where illusion trumped reality. A sister exhibit, “After Photoshop,” displayed the ubiquity of altered photography.

Even in this cynical age, it’s not always clear what is fake. For example, the iconic image of Lincoln on the right, is in fact a composite photo of John C. Calhoon, with Lincoln’s heade superimposed.

Even if your audience doesn’t know how to use Photoshop, Gimp, or other image editing tools, they are aware that images and video can be manipulated. The resulting “enhancements” in product shots and collateral can range from fibs to whoppers. Websites such as Four and Six rhetorically ask, “can any photo be trusted?”

But what happens if the customers’ cameras do the lying? Online sites such pixlr, picMonkey, and iPiccy, and many many others make photo enhancement – or as one site euphomizes it, “embetterment” –  cheap and easy. In a climate where marketers encourage and reward social media sharing of images via Instagram and Twitter, how many are bogus? Perhaps more to the point, how many which make your competitors’ offerings look better are biased?

What would you do, if an alienated customer posted an “enhanced” image showing how your product is inferior or injurious and the image became popular on social media?

Reputation management is problematic and there is no perfect defense. You should be monitoring what social media say about your organization. To this, you may also want to track what they’re showing as well.

When Customers Attack

The explosion of social media has given almost everyone access to a digital printing press, soapbox and a potentially very loud virtual megaphone. These folks include your customers, some of whom, may be upset with your products or the way your organization treats them. Others may simply have an ax to grind, and you may just be the first thing they see after sharpening it.

Communications consultant Paul Gillin and tech entrepreneur Greg Gianforte (G&G), have written a valuable book – Attack of the Customers.  It is part history, part survival kit, and part vaccine help you deal with the next customer attack. To quote G&G: “There has never been a better time to be a critic.”

The book explores both the challenge and opportunity that empowered and angry customers afford. The threats are obvious. It used to be that unsatisfied customers would not return or tell a small circle of friends that they didn’t like your offering. Now if you alienate them, they can create a Facebook page or go to Youtube and post a criticism. If their critique get noticed, think of United Breaks Guitars; you’ve not only got mail, you’ve got a problem.

Attacks can also be opportunities. G&G show how engaging unhappy customers can convert them into loyal fans. Responding to criticism can allow you to improve your own procedures, operations, and business models. This can enable you to increase both customer satisfaction and profitability.

The book is no academic treatise. It is a deep compendium of cases categorized and analyzed for lessons learned. Students of social media may be familiar with notorious cases, such as Jet Blue’s stranding passengers on the tarmac for up to nine hours. G&G, dive deeper and present examples and analyses, I had not encountered.

Social media can both amplify and shape responses of small groups of consumers. Often these complaints fail to propagate and so die out, before attaining critical mass. But not always, as the book illustrates extensively. The author’s broad experience is a welcome antidote to simplistic or formulaic responses to bad PR and worse corporate reflexes. G&G offer perspective on when you should engage critics and when it may be safe to ignore them. The latter should be a conscious choice rather than an ostrich-life reflex.

If your organization hasn’t been savaged in social media yet, it may well be tomorrow. Read Attack of the Customers and be prepared.

Note: Attack Of The Customers is currently available only through Amazon.com. You can also read a free sample chapter here.

 

Skewed Sentiment in the Twittersphere

Twitter, the popular micro-blogging and messaging service, has become a big deal – and twitter-bird-blue-on-whitenot just among social media. By its sixth birthday in 2012, it had an estimated 500 million “active” users worldwide, 140 million of whom are in the US. Based on its latest round of financing, its implied market capitalization would be $ 9.9 billion.

Activity on Twitter has become a leading indicator and Twitter sentiment is often reported in newscasts. The very volume of Twitter activity has become newsworthy. For example, the Academy Awards telecast generated 8.9 million Tweets and the Super Bowl garnered 24.1 million. Of course, many minor events are tweeted about – it seems that every conference, meeting, or presentation I attend – begins with announcing its hashtag.

A number of services such as Twitturly, Twitscoop, and Monitter allow you to track Twitter activity about your brand, organization, or cause. This can be interesting, but how relevant is it? Twitter measurement is relatively cheap and easy. Still, should you judge a marketing campaign or prospects for your latest product by reception on Twitter?

The folks at Twitter seem to think so and want to sell you a “promoted account,” which solicits more followers for you. Presumably, more followers will lead to more mentions.  If that won’t prime the pump, you can also pay for Promoted Tweets, which you can send to audiences who don’t follow you.

The question still remains, is Twitter sentiment a good proxy for what the Universe thinks about your organization or product? An interesting study just released from the Pew Research Center points to significant selection bias in  reactions on Twitter, compared to responses in statistically representative surveys. For example, the 2013 State of the Union Address was substantially more positively rated in polls (42%) than by Tweets (21%). According to the Pew researchers ” Twitter users are not representative of the public.”

This may not be shocking, but it should give one pause. How many of your users not only have Twitter accounts, but are actively engaged. Unless you’ve restricted your market to Twitterati, you may be wise to do some of the heavy lifting involved in market research.

Please Tweet me your thoughts @4ourth.