Blog Bites Man

Jackie Huba at The Church of the Customer has blogged about Mouthonomics — the financial windfall from word of mouth marketing as measured by a company’s Net Promoter Score (NPS). It was a comforting blog to read, especially after all the snarky comments I’ve read about NPS recently. One thing’s for sure, there are no end of opinions about NPS. For an unbiased discussion of the strengths and weaknesses of NPS, I can’t recommend enough this report (PDF) by Justin Kirby and Alain Samson.

We just ran our first NPS survey and I published the results publicly. My feeling is that it’s a good number to track, but it doesn’t give you all the answers. It’s a metric, nothing more. For what it’s worth, I think it’s a better metric than revenue growth for helping companies to predict future growth; it’s a good bellwether.

More important than the metric is the feedback (we include an open text field and prompt respondents to tell us why they gave us the score), including the feedback from the 7’s and 8’s, the so-called passives. Frankly, many of the passives gave us better praise than the promoters (9’s and 10’s), and many of the promoters had strong criticism. ie, you can’t just look at the number and rest on your butt. The true work begins after the survey to try and address the concerns and issues that customers are experiencing.

Robert Stephens, CEO and founder at Geek Squad, delivered the second keynote at Customer Service is the New Marketing (yesterday’s blog post about the first keynote).

His comments echoed much of what Tony had to say about creating a great company culture. Although his talk touched on customer service and experience, it actually largely touched on brand — as in the marketing kind, not the kind a company gets over time based on it’s products and services. I was surprised how much time he spent at a conference about customer service talking about what ties the Agents wear and what cars they drive.

Marketing on the soles of his shoes
If I had to boil down what he said into three points, they would be:

Be yourself. In a time where Web 2.0 design has hijacked most website’s brand look and feel, companies like Geek Squad (and SmugMug acknowledged the value of looking different at the Crunchies) smartly swim against the tide. The retro police detective schtick works well. The brand is everywhere, including in the Agent’s shoes, tie, shirts, socks, and die-cast badge.

Put your brand at every step — literally. Because Geek Squad buys outfits for their Agents, it made sense at some point — the point at which it was cost effective — to make custom shoes. But not just any shoes. These shoes supposedly have a reverse imprint of the company logo on the soles of the shoes.

Robert did the math, too — people step an average of 7,000 times per day, he said. Multiply that by the number of Agents on the street, you possibly get some killer guerrilla marketing with each step.

There’s no way to measure the ROI, of course. What are the odds the shoes will make an imprint on any given day… and will anyone see it… and will it have any effect? But since they have to purchase so many shoes anyway, and since the cost was not that much more to create the imprint, it seemed like a good idea.

It’s time to grow up. He sold Geek Squad to Best Buy. In one fell swoop — hiring, training, and customer acquisition solved. Hiring — it exposes Geek Squad to gadget geeks shopping at Best Buy. Training — Geek Squad Agents also get a nice discount at Best Buy so they can try and test and learn the gadgets that they’re eventually going to have to support. Customer acquisition — customer opportunities walk through the door every day.

While you can’t put an exact value on this branding, it demonstrates Geek Squad’s ability to think different, to utilize every part of their vast workforce, and to do it all without incurring excessive costs or time.

There were three themes that were reiterated again and again at the Customer Service is the New Marketing conference in SF today:

1. Open, transparent, and honest conversations are important
2. Empowering community is the best way to scale
3. Make a real big effort to help your customers; even if you don’t always succeed, people appreciate that you’re trying.

Keynote about culture

Probably the most riveting presentation was the keynote delivered by Tony Hsieh, CEO of Zappos. Tony kept reiterating the idea of creating a great culture of service. Zappos is not a company with a mission to sell merchandise, it’s a company built to offer great service. They just happen to sell shoes.

Now, that may appear obvious to people reading this. Of course you focus on providing great service. But that’s not what most companies do. Most companies focus on making the sale. Service is frequently usually an afterthought.

Most companies focus on new customers and lead generation, but here’s a case where service is the lead gen device. Good service means repeat customers and word of mouth. Zappos tries to get more repeat customers, not necessarily new customers. That’s a different lead gen strategy! In a commoditized world like shoes, service is the differentiator. Their sales and growth to-date would seem to support that focusing on service was a good choice.

How do you foster a culture of great customer service?

Creating the right culture is what keeps Tony up at night. Not sales, not merchandising, not operations… culture.

To address culture, everyone in the company — whether you’re in sales, service, or merchandising — everyone, gets 5-weeks of training. It includes immersion in the culture, core values, customer service, warehouse, and more.

What are those core values? He listed the company’s 10 core values. I jotted down about half of them, the ones that struck me as particularly innovative:

#1. Deliver “wow” through service
The word “wow” was borrowed from the things their customers tell them. Customers repeatedly begin their emails with the word. They’re amazed at how Zappos lives their promise of fast and no-questions-asked customer service. Zappos took this idea and built it into their core values.

Waitaminute. Zappos took what customers were saying and put it into their core values. That’s a powerful way to reinforce a cool thing and it makes a statement to employees how powerful their customers are. Wow.

#3. Create fun and a little weirdness
Being different makes them more memorable, a fun place to work. Maybe most importantly, it makes it easier to recruit the “right” people. More of the right people helps ensure the culture will thrive.

#6. Build open and honest relationships with communities
Honesty, transparency, openness was a theme throughout the day.

#10. Be humble
He’s the CEO? That’s exactly what I thought when Tony first took the stage. He was unassuming and a little bashful. Then he revealed this 10th core value and it made a lot of sense. He was so un-CEO-like (ie, humble) that I could see the company walked the talk, from the CEO on down.

Putting your money where your mouth is

The last thing I’ll mention about Zappos:

Most call centers train their employees to hang up the phone as fast as possible; answer the question, then hang up. Not so at Zappos. Zappos’ call-center reps are not measured on call time.

They don’t often like hiring people with call center experience, because it means they have to retrain them. They’d rather hire people that believe in providing excellent customer service. Because no one is measured on call time, Zappos is perfectly content to let a call center rep stay on the phone with the customer for over an hour… even if a sale doesn’t result from the call.

That’s smart.

How do you turn people into better direct mail marketers? Send them to USPS — that’s right, the US Postal Service. Once they’re there (standing in long and tedious lines while waiting to return the Zune player that they received as a holiday gift), they’ll see these brochures (I picked up 2 of 3):

Some smart mucky muck at USPS hired the right marketing agency to create a campaign targeting small business owners. They are effective brochures, the copy is engaging, the layout easy on the eyes. They don’t preach the benefits of USPS over competitors, or offer any unique promotions or Postal Service value propositions. Instead, they offer (good) suggestions to make USPS customers more effective marketers — similar advice an agency would offer a SMB owner, albeit more concise and free.

For example the brochure on the left in the photo above includes this message:

“In five short words, farm-fresh eggs sold here captures the four-part forumula for letters, flyers and brochures that sell.

1. Attention
2. Interest
3. Desire
4. Action”

The inside of the brochure goes into each piece of the forumula, spelling it out for readers in engaging, concrete prose.

Making your customers better at their jobs is a good long-term solution for driving revenue. It’s long-term because what you’re really doing is building relationships. I’m much more likely to want to work again and again with the agency that makes me smarter than one that offers the lowest price. In this scenario the agency is no longer a vendor, it’s now your business partner.

The biggest flaw — the pink elephant in the room — is USPS. Their reputation and front desk service needs to catch up with this progressive marketing. Waiting in line for 10-20 minutes does nothing to reassure me about their business services!

I’ve yet to hear anyone, me included, say “my ____ [insert organization type here: company, non-profit, or team] communicates perfectly.” At every company I’ve worked for and with everyone I’ve spoken to, communication always seems broken. Your boss doesn’t communicate with you, the management team doesn’t communicate, or the left hand doesn’t know what the right hand is doing. While the company I work for can improve upon communication, I think we do it better than most.

I wrote a looooong blog post today about how we do collaboration. Since we sell software for doing distributed software development and collaboration, it seemed fit to put the spotlight on ourselves.

In theory, one would hope if we’re going to sell this stuff that we actually use it, too! For marketing, I’ve found the wiki to be invaluable in making it possible to communicate within the company and with contractors. A while ago, I wrote a post about using wikis for marketing, too. Here’s a link to the blog today on collaboration.

Hadn’t intend to write a sequel to this push v pull post, but a few very concrete tactical ideas were taking up space in my brain….

Making “pull” happen means putting few to zero resources in “push” things like a direct sales force, outbound emails, and telemarketing. In my previous post, I focused on high-level concepts, but more practically, here are some thoughts of where to spend your marketing dollars:

Creating a great website first, SEO second: Write useful, informative content your audience — be they customers, journalists, or consumers — wants to read without stuffing search engines with keywords. If you know the audience you’re writing for, the content of your site will get a decent ranking from the search engines. Then, you can optimize the site with the header tags, linking, alt tags, add your company’s name to the Yahoo! directory, work on your linking strategy, and all the other things that the SEO experts talk about.

Word of mouth and creating evangelists: Do you trust your friends’ recommendations or what some marketer tells you? Studies confirm that what you’re thinking: friends of course. Word of mouth is the most powerful way to market your products.Risk-free offers, trial evaluations, open or closed beta testing are ways to get people to try your stuff and, by extension, create some evangelists. There are ways, too, to systematically encourage word of mouth. For example, tell-a-friend programs. Working Assets gives their customers a free pint of Ben & Jerry’s ice cream for 12-months if their their friends signed up to use the phone carrier’s service.

Perhaps the simplest way to encourage word of mouth is by shocking your customers with a product or level of customer service that knocks their socks off.

Advertise: Start with Google, Microsoft, Yahoo, and/or specialty engine ad networks and search ads first. They’re targeted. Experiment with other types of advertising such as banner ads.Scoble may say that newspapers are dead (and by extension, I assume he means print publications because they’re disappearing, consolidating, and crumbling too) but more pragmatic folks believe, and I agree, that print publications work perfectly well for some audiences. It’s just way more expensive than a lot of online marketing and it’s hard, if not downright impossible, to measure its impact. But the bottom line is that you have to go where your customers are, online or off.

PR: Hiring agencies is another surefire way of spending a lot of money. These days, it’s often equally effective to start a conversational marketing PR strategy. Talk with customers, bloggers, and influences in your space. And listen. Those conversations will turn up online and in print. It’s a slow process, but it ultimately turns into coverage for your company and products, and it doesn’t cost a dime. I think agencies are better suited to some industries than others, but you need to keep a close eye on your spending.

Conferences: Still one of the best ways to brand a company and get your name out, but they are expensive and very time consuming.

Channel marketing: Get someone else to push for you!

When people ask me for marketing advice — for how to market their business or sell a couch on Craigslist — the first thing I tell them is that they’d get better advice asking their pets.

After I’m done with the self-deprecation, I boil down marketing to one principle: put yourself in their shoes, with their being your customers or your audience. Everything else is just window dressing.

• What does your customer want? (What are the features?)
• How does your product improve their lives? (What are the benefits?)
• What risk do buyers have? Is it real risk or perceived? How can you remove the risk? (Can you offer a risk-free trial or money back guarantee?)
• How would they find out about your products? (How will you promote your product?)
• Would they prefer to buy it from you or a reseller? (Is there someone else that would do a better job of selling your product for you?)
• Who else are they going to have to convince about buying your product or service? (Do you have to sell to their boss as well?)
• What are their expectations? (How will I fulfill my side of the agreement?)

A couple book recommendations:
Getting Everything You Can Out of All You’ve Got, Jay Abraham, is an okay book, a decent intro to marketing. He focuses mostly on removing all risks for the buyer — money back guarantees, 60-day free trials. There’s other stuff in there about making your business different, creating a niche for yourself.

Let My People Go Surfing, Yvon Chouinard, is by far my favorite book about all things for running a company, creating great products, differentiating your business from the competition, and marketing. I blogged about it quite some time ago.

To all ye job seekers, we’ve posted a few new openings at Atlassian. I’m looking for some talented folks to help us expand the marketing team.

• Open Source Systems Administrator
• Media and Community Spokesperson
  

What am I looking for in the Open Source Systems Administrator position?

• You equally enjoy working with technology and people
• You have a track record that demonstrates your support of, participation in, and advocacy for open source
• Killer Linux skills, comfort with Java
• You’ve maintained high volume, high availability website and systems
• You don’t mind getting out of the office now and again to visit user communities to meet customers and talk about Atlassian

And the Media and Community Spokesperson?

The ideal candidate is…

• A PR misfit… one that sees blogs, conversational marketing, transparency , and community building as the new pillars of PR.
• You have superb writing and verbal communication skills. And even better, you communicate in plain English and manage to avoid what blogger and author David Meerman Scott calls the Gobblydegook.
• We love metrics at Atlassian. We want to know cause and effect of most initiatives. While I’d want this person to do a fair share of reporting, I’d much prefer to hire a heads-up instead of a heads-down type, someone that would rather be chatting with customers, analysts, journalists, and bloggers instead of doing metrics.
• Got a blog or other work that reflects your conversational style and some well-thought out opinions?

But wait, there’s more! You can get an idea for life at Atlassian and the things we look for in every employee.

Coming soon: an opening for Product Marketing Manager. We have heaps of other jobs in Sydney and San Francisco that you can read about here.

If you’re reading this and it sounds good, give me a shout or send your resume along to jobs@atlassian.com.

I stumbled upon Erik Keller’s blog from a few months ago about whether companies should change their sales and marketing business from a “push” to a “pull” model. It was good timing. I had been thinking about blogging about how that change in thinking affects marketing priorities.

Enterprise software providers have conditioned sellers that they will lavish limitless time and attention on them for any type of deal regardless of buyer budgetary outlook and size. Though buyers may not realize it, they are paying for this inefficiency via bloated overhead costs. Unfortunately, for software sellers this behavior (and overhead) cannot be changed without a massive business reorientation.

Most overhead expenses are more associated with the selling of a software license then the deployment of services to install software as well as continuing maintenance payments. Thus when you look at the income statement of software vendors from this perspective, a key measure of corporate efficiency and productivity is the ratio of overhead (S&M plus G&A) to software license sales.

Atlassian didn’t change it’s business model — it had always sold software online with the so-called pull model — but I had to change my thinking when I came to Atlassian. Atlassian has a pre-sales team that handles orders and answers incoming questions, but no sales force or outbound sales team.

Shifting the paradigm from a push model, where sales reps are pounding the streets and shaking people down to uncover leads, to a pull model, where the customers find you, changes tactical marketing decisions in some fundamental ways.

1. There’s no hard sell. Either the customer will like your product or they won’t, you don’t actively try to convince them of anything. For marketers, it means we don’t have to spend the time writing feature/benefit cheat sheets for sales reps to memorize. My 30-second elevator pitch about our products is rusty from neglect.
2. The product is the sales tool. My second job out of college was at a small, independent textbook publishing company. The owner of the company had a mantra: our best sales tool is the product. Glossy 4-color brochures about a book don’t cut it. Get the books into the hands of the college professors to review so they can make a truly informed decision about the book they want to adopt for students. Same idea goes for the pull model. We can write heaps of glorious text about our products, but when it comes right down to it, if the customer can’t get their hands onto it and try it — really try it — then why would they ever want to buy it? Lesson here: lower all barriers to evaluation. Then lower them even more.
3. Upfront policies. All enterprise software companies have pricing sheets. But buyers will rarely, if ever, see the unadulterated versions. The sales rep wants to sell you first, then worry about price. You like the product, they become more willing to give you a starting price. That changes with a pull model.
4. Let go of the lead. Sales reps can influence a sale, but they have no control over it. Letting go of control over the sale allows the company to spend more time on dreaming up and developing great products. Great products are easy to market.
5. It’s about the user. Perhaps the biggest difference between a push and pull model is that marketing becomes about the user. A push model organization is focused on the happiness of the sales people. Push the product, get a commission, hand off product deployment to a project manager and move on. In pull marketing, user experience and satisfaction is important from the start of the evaluation period. The lesson here for marketing was looking beyond traditional lead generation to customer satisfaction, which means looking at user community resources, support, service, education and training.

I would argue one last point: this is all not possible without a little, or a lot of, transparency.

1. We admitted we were powerless over change—that spin was no longer in.
2. Came to believe that transparency in marketing could restore us to sanity.
3. Made a decision to turn our will and our lives over to the community.
4. Made a searching and fearless moral inventory of marketing budget.
5. Blogged publicly the exact nature of our wrongs.
6. Were entirely ready respond to the community about all these defects of character.
7. Humbly asked our customers to blog about their experiences—pro or con.
8. Made a list of all other marketers we had harmed because we trained them to spin the message, and became willing to make amends to them all.
9. Made public amends to such people wherever possible, except when to do so would injure them or others.
10. Continued to take personal inventory and when we were wrong promptly admitted it.
11. Sought through conversation and meditation to improve our conscious contact with the community as we understood it, actively seeking input while marketing.
12. Having had a spiritual awakening as the result of these steps, we tried to carry this message to the blogosphere, and to practice these principles in all our affairs.

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