#1 is when you talk directly to people who want to hear you.
#2 is taking #1 to scale by paying someone to carry your message for you, like advertising. Expensive, not always effective, but easy to scale.
#3 is when magazines and news outlets pick up your story because they think it matters. This is unpredictable but worth more because it comes off as unbiased.
#4 Is when, thanks to new technology and the democratization of distribution, people can pass your message to others, free, through blogs, Twitter and Facebook. Its costs little, very effective and scalable.
The tricky thing about #4 is that you can’t buy it like #2. And because it’s the most effective, companies try to make it work like #2, but it intrinsically doesn’t work like that, you can’t buy genuine desire to share. The only companies that are successful with #4 are the ones that make stuff worth talking about. If you really want to be successful in #4, don’t spend more money trying to turn it into #2, spend more money to change the product or service instead.

Purpose is the most influential element in business success. I believe that the formula for business success can be found faster in injecting a business with purpose than any other way. In this eBook I explain how focusing on purpose will improve business effectiveness, employee retention, employee engagement, customer loyalty and increased sales. Download PDF below.

I’m reading Evil Plans by Hugh MacLeod and he has a great quote in it from Director David Mackenzie, where he says, “A film is only as good as the reasons for making it.” Hugh explains, “What is true in Hollywood is also true for products and businesses. It’s not what you make, it’s what you believe in. That is what people respond to. That is where the enterprise lives or dies.”

A quote from Stephen Covey: “Management is going up the ladder as efficiently as possible, leadership is making sure the ladder is up against the right wall.” A lot of businesses go to work on improving inefficiencies and strengthening processes but without first focusing on their purpose, or what wall their leaning up against. Once that purpose is defined its important to let everyone know, as clearly as possible, which wall it is. Usually this purpose can be distilled into one sentence without any lame business jargon. Zappos declares to have the best customer service in the world. Wal-mart is the least expensive. Starbucks makes the worlds best coffee. It is the stake in the ground, line in the sand and banner in the sky that unapologetically declares the business’s purpose that everyone can rally behind and cause a movement. Again to quote Covey, “No management success can compensate for failure in leadership.” Working on the packaging, the logo or your Facebook page is like organizing deck chairs on the Titanic unless the customer has bought into the vision of the organization. For whatever problem a business has I think a sense of purpose will help overcome the problem faster than focusing on the problem itself.

When I was 19, before I left for college I worked at the Jolly Rancher factory in Wheat Ridge, Colorado (before it was closed down and shipped off to Canada) to save money for school. Like most recent high school graduates I wasn’t too motivated to do much and thought the $11.95 an hour sounded like a pretty sweet gig. Turns out working at the Jolly Rancher factory was the most mind numbing job I’d ever had. Watching candy go by on conveyor belts for 10 hours straight (I was working overtime to get paid time and a half) made me think I was going to go crazy. And then I realized that most of the people I was working with had been doing this for 10 to 20 to 30 years! It caused an identity crisis. Like a ton of bricks I realized that working in a factory was not me and from then on I was that much more incentivized to get an education.

One’s sense of identity is a huge motivator for change, and brands are constantly trying to get people to buy their stuff for the first time, or persuade them to buy their stuff instead of their competitor’s stuff. A major factor in opening the mind to change is the realization that you are no longer the person you wish to be and discovering the person you do want to be.
I recently finished reading the book Switch by Chip and Dan Heath (a good read) where they point to research by James March who says:

When people make choices they tend to rely on one of two basic models of decision making: the consequences model or the identity model. The consequences model assumes that when we have a decision to make, we weigh the costs and benefits of our options and make the choice that maximizes our satisfaction. In the identity model of decision making, we essentially ask ourselves three questions: Who am I? What sort of situation is this? What would someone like me do in this situation? Notice what’s missing: any calculation of costs and benefits.

Bad marketing uses rational, analytical incentives. When I say bad I mean it will train your customers to be eager to switch brands to save a buck.

Good marketing will cause an identity crisis: “I do not want to be the kind of mother who always nags her kids.” “I want to be a person my colleges can depend on, not a procrastinator.” “I want to be a size 8 again–size 16 is just not me.”

And then what happens next is identity theft, (because of this brand’s product or service I see myself as): “I’m the kind of mother that nurtures her kids to be amazing people.” “I’m the kind of dedicated professional that makes things happen.” “I’m the kind of person who cares about their outer beauty and inner beauty”.

Once you cause the identity crisis and identity theft you move onto earning and cultivating attention on top of a movement. People don’t want to connect with brands, they want to connect with other people. So brands need to seek out groups (people who have committed the same identity theft) that want to be connected and work to become the connecting the point. Brand marketing can facilitate that. So…

How do customers use your product to tell the world (and themselves) about who they are and their point of view? How can you give the audience ways to connect through the brand?

Sorry for the lack of “data driven-ness” in the last couple posts, this is stuff I’ve been thinking about lately and wanted to get it written down.

There are many people who blame doctor’s fee-for-service compensation models as one of the reasons of increasing health care costs; costs which are pushing the country towards bankruptcy. The problem is that doctors are incentivized to do more than is actually needed, since the more care they provide, the more money they get. In addition, expensive procedures earn them even more money which drive costs higher still.

Are advertising agency’s incentives also poorly structured in a way that is causing unhappy clients and poor results? Paying a percentage of the total media cost to the agency can incentivize agencies to choose media that is more expensive rather than effective. Paying an hourly fee means the agency is rewarded for the amount of time spent on the work, not the quality of the work. And just like a doctors expensive procedures, agencies like to pick big expensive ideas to wow their clients even if it’s not the best fit for their needs.

In a recent article in Businessweek, John Windsor of Victors & Spoils explained where he sees the current state of advertising:
“Advertising is all about relationships, and at the heart of the client/agency relationship is trust. That trust has been eroded by a lack of transparency and, often, resistance to change. Over the past few months, I’ve spent a lot of time with the chief marketing officers of Fortune 500 companies. The theme is consistent. They tell me stories of being charged $10,000 per second of video editing for clips to go on YouTube, $1,000 for a single foamcore presentation board, and $25,000 for event banners; an unwillingness to collaborate; and myriad indirect charges for parties and travel.

Somewhere along the way, the big-agency business became a lifestyle. But clients, who want the best creative work, don’t want to pay for it anymore. And they’re figuring out that they don’t have to. Smart agencies need to adapt their business models and fast, or they won’t have the opportunity to rebuild these relationships.”

I get the feeling that agency compensation models are outdated and the majority of agency/client relationships are steeped in an “us versus them” mentality rather than a trust mentality like John talks about. How to fix this? What about pay-per-performance? Or an agency could be treated more like an in-house marketing department where they are paid a set amount and expected to reach a certain level of results. I think an agency should leave the client better off than they were before, not just in terms of increased marketing share, but in terms of organization of company goals and direction, higher level of education and understanding of the market and better ability to take care of themselves. These ideas aren’t without their problems but eventually someone is going to figure out the right mix and make a lot of money adding value to the client, not just ideas and spent money.

Inspired by Avinash’s last post on ensuring a clear line of site with web metrics, I took a stab at creating a web analytics framework for a medium sized eCommerce site. This theoretical site is using the following marketing channels: paid search (brand and non-brand keywords), comparison shopping engines, affiliates, email, display advertising and social media (Facebook and Twitter).

I tried to figure out where each of those channels would fit into the what matters most diagram from Avinash’s post (I know I’m missing some so I left an empty space below each segment for additional ideas), and then those channel’s strategies, KPI’s and KPI Targets.

Click to Enlarge

I really enjoyed this exercise and get how effective this would be for any organization to get everyone on the same page. It gives the people at the top an accurate idea of what the site is really worth and it gives the analysts a direction to start doing segmented analysis to discover problems to fix what directly affect net income.

Download the Web Analytics Framework.

The best marketing tactics I know of are 1. earning attention instead of buying it and 2. making stuff for your fans rather than finding fans for your stuff. Those tactics work even better when built on top of a movement. When the attention being earned is from people who identify themselves as part of that movement and want to be connected to other like-minded people. Then the brand works to become the connecting point.

My favorite part of this strategy is that it fits online perfectly, cost little and size of the business doesn’t matter.

Earning attention is about thinking of yourself as a publisher of helpful content related to a movement that people want rather than a marketer who is trying to interrupt. This content is then spread (if its good) throughout the group that identifies themselves as part of the movement and invites them to come back and sign up. Then the brand has the ability of delivering anticipated, personal and relevant messages to the people who want to get them. Repeat.

I’m going to write more about the different tactics of this strategy in upcoming posts so stay tuned.

I love music. I was in a short lived band once and still have: being in a touring band at the top of my do-before-I-die lists. I saw this info graphic that shows how little musicians earn online and then I read this article about how last week had the fewest number of albums sold in one week since Soundscan began compiling data in 1994, and it started me thinking about how I would do it if I were in a band that people cared about. So this is what I would do.

Disclaimer: Musicians don’t want to think of themselves as marketers or entrepreneurs but I believe that’s exactly what small musicians need to see themselves as to make money in this new digital world. I say, Get over it.

First, I would like to describe my strategy and then below I’ll put the tactics. The main trust of my strategy is sumed up well with this quote by Cory Doctorow, “It’s very hard to monetize fame, but impossible to monetize obscurity.” You’ll never sell anything if no one listens to you, so how do you get as many people as possible to listen to you? Share your music and get others to do the same. A fact of the internet is that If the product you make becomes digital, expect that the product you make will be copied. Let your music be copied and shared as much as possible.

The second side to this strategy is that once you can distribute something digitally, for free, it will spread as long as it’s good. If it spreads, you can use it as a vehicle to allow people to come back to you and register, to sign up, to give you permission to interact and to keep them in the loop. The spread of your digital music in an effort to create a well maintained following is the core of being a successful self-published musician.

The bands that create communities, connect people and spread ideas are the ones that will win. Seth Godin defines permission as an asset to be earned. “The ability (not the right, but the privilege) of delivering anticipated, personal and relevant messages to people who want to get them,” is his definition of permission marketing and that is the biggest tool in the independant musicians tool belt. Most good bands have a message that their fans rally behind: anti-war, fun, unity – whatever. Your band needs to seek out those groups that agree with your message and want to be connected – and then the band works to become the connecting point.

Let me tell you what this strategy is not: You are not trying to get discovered by some self claimed gatekeeper who decides what the masses get to listen to. I would never try to join a label. What’s the point? All the tools necessary to self publish and distribute to the world are there already at your fingertips.

Onto the tactics:
1. Sell whats scarce. Music as a digital product is anything but scarce. And you don’t want it to be, you want everyone possible to listen to your music. Meanwhile, the one thing that you can’t digitize and distribute with full fidelity is a live show, limited edition t-shirts, special edition album covers and community. This is where you’ll make money.

2. To sell that stuff, you need to find your audience. I would make a band blog where I would write about what’s going on with the band as well as writing on the topics that the band is founded upon. Also there would be a music section for people to stream any song I had written. Next to each song I would put the Facebook Like button so people could Like individual songs which gets the song sent to their news feed in Facebook for all their friends to see. This would also allow me to message any of those people who Liked a song later on. Also next to each song would be a link to Tweet the song, email the song, embed the song on their own site or any other kind of sharing possible.

A downloadable high quality version of my music would be available if the person gave me their email address. Along with the download I would include album art, liner notes and stencils for printing out and spray painting the band name or image. I would also include a message to invite the downloader to share the music with their friends. Next to the download button would be a donate button to anyone who wanted to chip something in for getting the music.

I would also make a Facebook fan page, twitter account and YouTube channel for my band where the content from the band blog would be syndicated. All of these different avenues allows people to consume my music in their preferred place. If they want to listen to my music on Facebook but hate Twitter, or vice versa, I would make it possible.

I would make a YouTube channel and make music videos for every song I record. They don’t need to be high production cost videos just whatever speaks to the fans.

I would make a flicker group for fans to upload images from shows or themselves being a part of the music.

3. Once you find your audience, turn them into family. Kevin Kelly says you really only need 1,000 true fans to make a living. Making music for your fans instead of finding fans for your music. All sharing tactics above have the same goal in mind – get as many people as possible to listen and then capture their email to create your fan database. The fans in the database are your biggest asset. I would turn my music into a subscription service. They are the ones you send anticipated, personal and relevant messages to. They get first dibs on listening to new music. They get alternate tracks. They get asked for their feedback and see that their feedback gets put into practice. They get to talk to each other on the blog. They get exclusive fan club stickers and patches. They also can buy tickets to shows before eveyone else, buy the limited-run t-shirts before everyone else and get first dibs on buying special edition delux albums.

The internet is the best thing to ever happen to music. In an age when it’s cheaper and easier than ever to design something, to make something, to bring something to market, bands win.

There are two types of job seekers: active and passive. An active job seeker is someone who is unemployed and is actively searching for a job, posting their resume on internet job boards, responding to available positions on Craigslist and networking with friends to find a job. A passive job seeker is currently employed. They aren’t actively looking for a job by posting their resume where ever they can, but if the right opportunity came up, they might consider a change. If you’re only recruiting from active job seekers, you are limiting your potential to find great talent.

Passive job seekers are much more sought after by recruiters and head-hunters than active job seekers. Active job seekers are riskier since they are currently unemployed (and may be that way for a reason), potentially desperate which could make them over-eager to the point of exaggerating their skills and unproven that their skills are adequate to do the job.

Internet marketing tools lend themselves perfectly to attracting passive job seekers since recruiting is in itself marketing:

The recruiter doesn’t solve an urgent problem for the person being recruited, in fact, they create one. That person already has a job (hence no problem). The problem being created is that until they change over to your job, they’ll be unhappy. (Seth Godin, The Difference Between Hiring & Recruiting)

Passive job seekers are out there online reading blogs and consuming content just like everyone else. Using Google’s AdPlanner and AdWords tools, you can select your demographic, get targeted ads in front of those passive job seekers within that demographic, send them to engaging landing pages after they click that invite them to submit a resume and use cost per resumes submitted (CRS) as your driving metric and then accurately measure your cost per hire. I won’t go into full detail on all the strategies that could be used to do this (because there are many), instead I’ll hopefully open your eyes to how effective and affordable recruiting for passive job seekers online can be.

Lets say you need to recruit a web designer to work for your business in Denver. Using Google Adplanner, you can create a detailed media plan based on the demographic of that person. In the “Research Tab” of AdPlanner you can search by site if you know of particular sites that you think your passive job seekers are going to, or you can search by audience.  Whenever you search by site you can see stats for that site to see if it aligns with the kind of candidate you’re looking for. I choose the site SmashingMagazine.com for this example so you can see the kind of detail it gives.

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The other option is to use the “Search by Audience” tab. You can filter by Geography and either target the whole state or click the plus box and choose a region within the state. I also recommend using the Ad Specs button to choose “In Google Content Network” so that only sites that allow ads from Google show up and also the “Ad Specs” button to filter the kind of advertising you’re going to do, there’s no sense at looking at sites that don’t support image ads if that’s what you’ll be using.

You can also filter by demographic to build your targeted list. For targeting a web designer I would choose the “Sites Visited” button and enter a few sites that have to do with web design and then I would click on keywords searched and choose words like “web design blog”, “MYSQL update” or “photoshop brushes”. Sites meeting your criteria get listed and you can ad them to your plan. If you sort by “Comp Index” it will sort by the sites that closest meet your requirements. Once you have your Media Plan made you can export it to excel for uploading into Adwords.

In Adwords you can create a campaign for your Web Designer candidate and choose to have your ads show only on the sites that you chose. You can also set the location that your ads will be seen, in my example case this would be Denver, schedule the ads to only be shown during work hours (for catching those passive job seekers while they are browsing the net while at work) and set a daily budget for how much you are willing to spend a day.

After the ads get going you can start to optimize your ads by testing different ad variations, excluding sites that aren’t performing well and use Google’s Website Optimizer to do A/B testing on your landing pages to get the most resumes submitted as possible.

Utilizing these tools for recruiting passive job seekers is a must for any organization looking to find good talent without spending large amounts on head hunter finder fees and job placement companies. Let me know any questions that you have in the comments!