[Babson President Len Schlesinger making the intro...]
Last Saturday my business parter, Jason Korman and I gave a wee Q&A talk up at Babson College entitled, “How To Make The Internet Squeal Like A Pig”, as part of their tenth annual Babson Enterprise Forum. Below are the rough notes/transcription, with Jason asking the questions and me doing the answering. Thanks Again to Len for the great opportunity, we had a blast!
HOW TO MAKE THE INTERNET SQUEAL LIKE A PIG
Q. So, Make the Internet Squeal like a pig, what you mean by that?
If you’re going to be an entrepreneur these days, you’re going to have to figure out the Internet.
From the entrepreneur’s perspective, what makes the Internet tick? From an entrepreneurial perspective, what actually works?
We’ve built a tidy internet based business over the last ten years, b just obeying a few rules and they’re not easy to execute, but they are easy to understand.
Q. If you were going to generalize about these rules, what could you say?
The Internet is just like anywhere else- offline is just like online. Basically, the ideas that spread, win. The ideas that go no where, lose.
Q. So what spreads, how do you create stuff that goes viral?
Viral is a figment of people’s imagination.
The thing that spreads online, of course, is “great content”. This great content can either be your product itself (Huffington Post), or content about or somehow connected to your product (37 Signals).
Q. But what does that actually mean? What does great content have, that mediocre content lacks?
You can’t just say, “I’ll know it when I see it”. No, great content has its greatness baked in somehow. It follows rules. It has elements.
Q. Let’s talk about the five building blocks of great content- Recent buzzwords have made it sound like it Is just about passion and authenticity – is that all one needs?
Passion for passion’s sake is usually misdirected as it often misses business purpose. Authenticity has become a black hole. As I tweeted a few months ago, Authenticity is the new Bullshit. Authenticity is now being faked so well, that its hard to tell real real, vs real fake.
Q. So, if its then not about passion and authenticity, then what is about.
As with any human endeavor, WHY you do something is ALWAYS more interesting than WHAT you actually do.
Q. So is it about that Why? Where does that “Why” come from?
The question of “Why” in business was first raised by our friend, Mark Earls, in his 2001 book “Welcome to the Creative Age”. He called called the “Purpose Idea” – This has become a popular subject in contemporary business, and it has to do with the ‘why’ of what you do.
The “Why” is not your mission statement, it is not about “Best Practices” – it is about the heart and soul of what you do – As Simon Sinak says, the” People don’t buy what you do, they buy why you do it“. “Why” is the thing that gets you and your colleagues out of bed in the morning.
Call it the “Why”, call it the Purpose Idea, it is all the same: It defines the true motivation of your business, as opposed to the “what” you do of your business.
Q. How is it different from the “What’ of your business.
What is the end result. It is the actual service or product. If I am in the business of producing notebooks, for example, that is the end product, but the why might be to help people be more creative, as is the case with Moleskins.
Q. The “WHY” of contemporary business really had its roots in the 1960’s and 1970’s – How has it developed since then?
We think that the ‘Why’ question first originated in cause-centered businesses of the 60’s and 70’s – Anita Roddick, at the Body Shop (explain). The Whole Earth Catalogue, Rollingstone and MAD magazines in their own way. The idea that business could work for social good or change was at the heart and soul of why they did what they did every day.
So, while this idea started with the cause-driven enterprise, It has developed much further, and veered away from just social causes. Certain companies such as outdoor retailer REI (actually founded in 1938) is a good example, a COOP, it is now a billion and a half dollar business, these businesses were on some level, even if they were for- profit businesses, had a social cause. Rollingstone- Mad, etc)
It is really about the real belief that is at the core of your product or service. It is in part about function, it is in part about the soul of your service or product.
If people connect with your values, your “why”, they’ll tell their friends, it’s that simple.
Q. So, how does that translate to more mundane businesses, companies that are not out to change the world, but just to sell something and make a profit.
Okay, let’s talk about retailing shoes. Tony Hsieh of Zappos made several hundred million dollars selling shoes. Why? Because he understood that shoes were his WHAT, but his WHY was DELIVERING HAPPINESS.
Rackspace, a ten year old hosting business, completely amazingly effectively against the titans of the tech world because they know that their what might be hosting, but their why is FANATICAL SUPPORT.
Q. We’ve grappled with the question of “Why” in our business, and its probably taken 3 years to resolve, but I think it is a good illustration of a Purpose Idea.
On the face of it, I’m a cartoonist, and we are in the business of selling cartoons. We license them, we sell them as limited edition prints, we do corporate commissions and messaging.
That’s all very jolly, but the question is: Why? And, it may of started off being, “Because I’m a cartoonist”, But today, why do we do what we do?
The answer is that our Purpose is not to make cartoons. Our true purpose is to create tools that people can use to communicate better, lead businesses more effectively, help people give more compelling presentations, create stronger organizations and generally kick ass harder and better.
That is our purpose and that is WHY we get out of bed every day. We help people kick ass through these amazingly effective little cartoons.
Q. What happens after you understand the WHY?
Once you understand your true purpose, and answer the question: “Why” – you then have a lens through which you view everything you do, every piece of marketing communication, every product or service offering.
At the same time, it must be said that finding the answer to “Why” isn’t always easy and is isn’t as simple as it looks – but the process of discovering it is very powerful.
So, the first thing you must do to is discover the “Why” of what you do.
It is easier to see now how it informs your entire online voice.
Q. You started blogging about “Smarter Conversations” in 2004. It’s your 2nd of the five items here. It seems like a simple idea. What makes it so powerful?
The great Doc Searls in the 1999 book he co-authored called “The Cluetrain Manifesto” famously wrote that “Markets are Conversations”. An obvious statement today, but it was a much less obvious statement a dozen years ago.
The point is whether you are buying fruit from a street vendor, or trading derivitives, markets are made by information and this information is exchanged through conversations ‘literally or metaphorically’.
So, if you want to be viewed as a leader in your industry, then the thing that you must do is have the Smartest Conversation in your industry.
This is one reason why blogs and other social media tools are so powerful. It costs nothing to have a voice, and if you are able to have a crazy smart conversation about your industry, you will get noticed.
Prospective customers will return your calls, you will be able to hire the best and smartest people in your industry, the media will turn to you when they need and expert. It will transform your business.
Q. So, what kind of companies are having a Smarter Conversation? It is usually the guys that also understand “Why”?
Target is one. They have a really smart conversation about the fact that design doesn’t have to be expensive. Shake Shack, also has a smarter conversation about better tasting fast food, as does Pret a Manger, a UK import sandwich chain now owned by MacDonalds that was very early into the sustainable, quality, nutritious fast food market. The Morgan Hotel Group transformed the entire hotel industry with a few properties in NY and Miami.
Q. You’ve blogged a lot about the idea of businesses having a Porous Membrane, what is it all about and how does that relate back to Smarter Conversations?
So the diagram above represents your market, or “The Conversation”. That is demarkated by the outer circle “y”.
2. There is a smaller, inner circle “x”.
3. So the entire market, the “conversation” is seperated into two distinct parts, the inner area “A” and the outer area “B”.
4. Area “A” represents your company, the people supplying the market. We call that “The Internal Conversation”.
5. Area “B” represents the people in the market who are not making, but buying. Otherwise know as the customers. We call that “The External Conversation”.
6. So each market from a corporate point of view has an internal and external conversation. What separates the two is a membrane, otherwise known as “x”.
7. Every company’s membrane is different, and controlled by a host of different technical and cultural factors.
8. Ideally, you want A and B to be identical as possible, or at least, in sync. The things that A is passionate about, B should also be passionate about. This we call “alignment”. A good example would be Zappos. The people at Zappos know that they’re job is to make people happy, and and so do their customers. They are aligned.
9. When A and B are no longer aligned is when the company starts getting into trouble. When A starts saying their gizmo is great and B is telling everybody it sucks, then you have serious misalignment.
10. So how do you keep misalignment from happening?
11. The answer lies in “x”, the membrane that seperates A from B. The more porous the membrane, the easier it is for conversations between A and B, the internal and external, to happen. The easier for the conversations on both side of membrane “x” to adjust to the other, to become like the other.
12. And nothing, and I do mean nothing, pokes holes in the membrane better than blogs. You want porous? You got porous. Blogs punch holes in membranes like it was Swiss cheese.
Q. So, it sounds like the more porous your membrane (“x”), the easier it is for the internal conversation to inform and align with the external conversation, and vice versa.
14. Not to mention it makes misalignment, if it happens, a lot easier to repair.
15. Of course this begs the question, why have a membrane “x” at all? Why bother with such a hierarchy? But that’s another story.
N.B. And yes, this works with internal blogs as well, poking holes in the membranes that seperate people within a corporate culture; aligning “the conversation” internally etc.The other advantage of internal blogging is that it organises conversation into a long-term manageable form. Two people sharing ideas via blogs is a lot more permanent, viral and useful for the company than two people sharing the same information over by the watercooler.
Q. So, poking holes in membranes subverts hierarchies and flattens Organizations?
Yes, that’s the idea…
Q. It doesn’t seem like any of this requires much of a budget, is it more about money or world view?
The decision is a moral decision, not a business decision. Since it costs nothing, it is simply about deciding. Once you do it, make it smart, put it through the lens of your business purpose.
If you tie this up with knowing your true business purpose, then you will have an amazingly powerful free marketing platform.
Q. Okay, We’ve covered Finding “Why”, “Smarter Conversations” and “Porous Membranes”, What is the next tactic for making the internet squeal?
We call it “Newsworthy Interventions”:
An Intervention is when you change the rules, when you alter the perceived reality, when you “poke the box”, as hackers like to say.
That’s what all great businesses do. They enter a pre-existing landscape and alter it forever, for the better.
Intervening with reality, in order to change it, for the better.
Q. This doesn’t sound like the sort of thing that a small bootstrapped start-up can do? How do you do this with limited resources?
There are small companies that do it all the time. The point here is that you have free media to craft (tell) any story you want. At the same time the media costs you nothing. Nada. So, you can, as we like to say, “roll snowballs down hill and see if they turn into avalanches”.
A perfect recent example is a little clothing company based in California called Betabrand. Cool clothes, disruptive messaging, Steware Lindland, the CEO says:
“We run our clothing company as an Internet company, so we play by Internet rules when doing so,” says Lindland. “One of the big rules of the Internet is that you have to be new all the time; there’s a sense of constant reinvention. We put out products as quickly as we possibly can, as frequently as we possibly can, and we try to get people takng about them with each one we put out. It’s almost like an editorial calendar that drives design.”
You see, this is a company that runs its business to take advantage of all the tools that the internet has to offer.
It is very similar to what you and I did with Stormhoek, where we viewed wine as an amplifier of ideas, to create fun content, which was just as important as the product itself.
Q. So, if you do a good enough job, then other people are going to want to talk about it –
And if enough people want to talk about it, then suddenly the media wants to talk about it as well… and the idea starts to spread, by the factor of ten. Or a hundred or a thousand.
But this doesn’t happen by itself. First it needs the opening salvo.
Q. SO, would it be safe to think about newsworthy interventions as PR 2.0?
You Bet. PR on Steroids, that embraces social and traditional medium
Q. The subject of Building Constituencies: Seth Godin called it Tribes, Mark Earls refers to it as Herd Behavior. Its the 4th item on the list. How does that make the internet work for entrepreneurs?
You have to remember that we are now dealing in a world where you know (or are discovering) your “purpose”, you are having a Smarter Conversation about your industry, and doing stuff that gets noticed.
Now, Mark and Seth have a different take with the same result and its worth talking about the differences.
Mark says that we are all Hyper Connected apes. We all have a need to not just connect with others, but to follow what others are doing. It is the glue of communities. It can be summarized in the old as where the fellow at the bar says “I’ll have what he’s having”. Mark would say that we all have a need to be part of a larger group, be accepted and be loved.
Seth would say that there are people within society who lead others through their actions. They are often not the usual sorts of leaders, but they can attract a huge following of people through their beliefs and actions.
Mark says we are hard wired to join groups, Seth says that we are inspired into groups. For the purposes of this conversation, they are one and the same.
As an entrepreneur, you need to find your tribe, your herd, etc.
However, you are now equipped with all the tools you need for them to find you.
You have your purpose, you know how to communicate it, you are finding them, but more likely, they are finding you.
Q. So how do you manage this Tribe?
The answer to that question is one that we don’t have time for today, it is more important that we all know that your goal is to attract like minded people through broadcasting your purpose and then inspiring, managing and most importantly scaling that tribe effectively.
Another way of putting it is:
“A good customer base is the best marketing department there is.”
It sounds like once you have your tribe, they can be one of the main drivers of your business’s growth?
Q. So, lastly, HOW DO WE TIE THIS ALL TOGETHER?
Make Social Objects:
We like to say that “Social Objects are the future of marketing”.
Q. Can you please explain What is a social object?
A social object is a product, idea or piece of communication that is inherently interesting enough that people want to talk about it or share it. It could be the phone in your pocket, according to X Farley CMO of Ford, a car is a social object – or it could be a cartoon. Social Objects have meaning that do not require further explanation, but encourage conversation and human interaction around them.
A good example of social objects are:
Once you are interesting, then you will have the attention of your market, or the people who matter in your market, and then you want your product or service to spread.
We like to say that “Social Objects are the future of marketing” .
What is a social object?
We are hyper-social primates that have a need to socialize. These objects
Malinofsky came up with the insight that people socialize around objects.
These days lots of very smart marketers are very concerned with how to make them because it is understood that they are very powerful tools.
Fundamental building blocks to creating them.
The three ways to create meaning in your (hat tip: Guy Kawasaki):
- Improve the quality of life
- Right a wrong
- Prevent the end of something good (artisanal)
- Create Play – it’s well recognized how important Play for learning, etc.