November, 2012

  • November 28, 2012

    • The headline from yesterday really caught my eye: “Gartner Says by 2014, 80 Percent of Current Gamified Applications Will Fail to Meet Business Objectives Primarily Due to Poor Design”.  It immediately brought me back to that old chestnut from CRM’s salad days half of CRM implementations would fail.

    It’s not that the prediction is wrong or that it’s not backed up by research, it’s that the notion in the headline leaves me saying, “And?”  The and is the interesting part and the press release on which the report is based goes into some detail that suggests that the authors are on track and that there’s time to do something about this canary in a coal mine.  This para from the PR summarizes the problem,

    “The focus is on the obvious game mechanics, such as points, badges and leader boards, rather than the more subtle and more important game design elements, such as balancing competition and collaboration, or defining a meaningful game economy,” Mr. Burke said. “As a result, in many cases, organizations are simply counting points, slapping meaningless badges on activities and creating gamified applications that are simply not engaging for the target audience. Some organizations are already beginning to cast off poorly designed gamified applications.”

    Yup, that’s about right and I would say it’s also tres, tres typical for an emerging market.  First you get the mechanics right then you work on the substance.  I think that by 2014 the twenty percent who survive will have moved on to substance.

    You know, that paragraph describes nothing as well as it does the airline industry and its obsession with frequent flier miles.  Sadly, those programs have been around a long time and have failed to deliver much real value so that makes me skeptical of the 2014 assertion.

    Your whole status in the airline programs is wrapped up in a badge that gives you absolutely meaningless rewards like getting on the plane earlier.  But as soon as you spend the miles you’ve built up you lose your status.  You are no longer as valuable despite your demonstrated loyalty.  It should not be that way.

    Airlines are a great example of failure at “defining a meaningful game economy.”  If I was an economist looking at frequent flier programs I would conclude that all of the programs are in a recession driven by hoarding.  I know too many people who are wrapped up in the idea of making it to the next level of a program as if they were playing PacMan or something.

    Few people spend their rewards because it involves losing status.  But I bet the airlines like it that way.  As long as the points stay on the books, they are an unclaimed liability and some airlines have taken to “rewarding” dormant or semi-dormant accounts with magazine subscriptions to clear those liabilities.

    You can’t have it both ways.  If your game economy involves a reward beyond the meaningless badges everyone throws around, them there has to be a redemption mechanism that won’t diminish status.  One’s status should not be held hostage to redemption.  A loyal customer or one with demonstrated expertise is intrinsically valuable and such customers should be exalted and, of course, this goes way beyond frequent flier programs.

    I just got a check from Costco rebating me two percent on all of my purchases for the last year.  Two points doesn’t sound like a lot but it paid for a heck of a Thanksgiving.  I am loyal to Costco but mostly because I get good service and good prices every week.

    A few years ago, I gave up on frequent flier points.  I used up all of my points flying first class until there were only enough left to get some magazines.  Then I switched airlines for better service.  Now I have to pay to check my bag and I get on the plane with the rest of the plain old citizens and I don’t mind.  I actually found it insulting as an American to have to walk on this carpet but not that one as my miles status fluctuated.

    My point is that a sub-par service will only be helped so much by gamification and the rewards have to be meaningful, which is what Gartner is saying.  For all the people with a gazillion miles flying religiously on an airline that treats them like dirt, there are some intrepid souls who still shop for deals and quality.  So the danger with gamification isn’t that the approach will die off, it’s that vendors might hide behind their games thinking they are doing better than they are, and that’s the beginning of serious business problems.

    Published: 11 years ago


    All year, it seems like, we’ve been running CRM Idol, the contest started by Paul Greenberg to identify hot emerging companies in the greater CRM space.  We are now down to voting for finalists and this is where you finally get the chance to make your ideas known.  Time to vote.

    This year’s crop of contestants, and especially the finalists, was exceptionally strong.  These companies are all well deserving of the venture capital that they’ve already raised as well as what will be showered on them after the voting is over.  We could tell right away that this year’s crop was a cut above last year’s — and they were pretty special, too.  But the companies in this year’s contest really, really get it.  They are laser focused on social and its many tentacles into CRM.

    But social is not the only thing on the menu.  We’ve seen an impressive array of automation that goes from various forms of analysis to clever virtual agents.  So, when you vote think about all that and also think about how three of the seven finalists come from parts outside of Norte America.  That’s right, this is a global event these days.

    So let’s get to it.  To vote go to the CRM Idol site here and please, s’il vous plait, por favor, puhleeze! watch the video that each company made to describe to you the business problem they solve, how they do it and what customers think of it.  Then read our judges reviews of each company.  Figure you need to spend about 30 minutes to do this job right and we need you to be conscientious about it.

    Don’t worry if you can’t get it all done in one sitting, we know what it’s like to live in these distracted times.  But come back if you need to, make some notes to yourself.  Rule some out before making your final selection if it helps (just like taking the SATs).

    So, go vote, it will do you some good.  It will show you where the market is moving.  It will also help some very talented emerging companies to sharpen their ideas and offers.  Most importantly, I’ve come to see Idol as the premiere community building activity in the front office.  You don’t see ERP vendors doing this, or HCM or any other branch of software (OK, maybe gamers have something equivalent but that’s not business, it’s entertainment).  It’s one of those things — like Dreamforce — that makes CRM such a hip and vibrant place to hang your hat.  Click here to get going. 

    Thanks! Gracias! Prego! Much obliged, pardner.

    Published: 11 years ago


    Sometimes you walk away from a user group meeting concluding that the company didn’t introduce much that was really new.  You might get the usual product announcements or the dot-version releases and you may take a course that makes you a little smarter about the fine points of some esoteric feature that helps you to do your job.  You might say that such gatherings are evolutionary rather than revolutionary.  Last week’s Oracle OpenWorld was nothing like that.

    I am sure that Oracle did not have ground breaking announcements for all of its estimated 2500 products but what I saw had revolution written all over it.  In CRM and in the fundamentals of database operation the company appeared to be closely hewing to CEO Larry Ellison’s belief that everything changes about every ten years.  In the circumstance, it looked to me like Oracle was giving history a little push.

    Siebel rising

    It took several years for Oracle to absorb Siebel and retool its database — when Oracle bought Siebel, DB2 was the database of choice, at least for the on demand product, but that’s old news.  The Siebel people who came over with the acquisition have been hard at work improving the product that was once the leader in enterprise CRM under the direction of SVP of CRM Anthony Lye.

    At OpenWorld, Lye’s team introduced a new generation of Siebel products and quite possibly a new generation of CRM, which the company dubbed Social CRM.  The Siebel team takes pains to make the point that Social CRM is not a replacement for conventional CRM and in many respects Social CRM is simply Oracle branding for CRM 2.0. 

    Naming aside, Oracle has made a significant contribution to the CRM 2.0 discussion by providing a framework for multiple kinds of social media-infused applications that gather and share data in support of conventional and non-conventional business processes. 

    One of the knocks against CRM 2.0 has been that the idea has been made up of a large group of Balkanized applications, many from start-up companies, that provided a piece to the puzzle.  So far CRM 2.0 has often been left the user to figure out how to bring disparate solutions together to support a company’s business processes.  Sound familiar?  It should, it’s what often happens in early markets.  Oracle’s effort to bring Social CRM together under one roof marks an important turning point in the evolution of CRM 2.0.

    The company’s Social CRM kit includes a prospecting tool that helps sales people figure out what to sell and who to sell it to, a loyalty and marketing product that helps vendors zero in on customer needs and to sell to those needs and a sales library.  What you just read is a gross over simplification but I leave it to you to fetch the details.

    Bee software (or haven’t we seen this movie?)

    More generally speaking Oracle also introduced Beehive a collaboration application that will help enterprises bring together knowledge workers and their knowledge work to share ideas and most importantly bring the right people together especially for ad hoc situations.  I do not pretend to understand Beehive any better than this and judging from the presentations I am not sure Oracle does either.  That may be too harsh and I expect that what Beehive does is so new that it will take time just to understand the business pain that it exposes.  If anything, Beehive might say a lot about Oracle’s efforts to look over the horizon to support its customers.

    Larry’s a database guy at heart

    I was thinking about going home rather than waiting around for Larry Ellison’s keynote, which was scheduled for Wednesday.  By the end of Tuesday I had enough information about CRM (and enough CRM parties) to file my share of stories.  I stayed anyhow and I was not disappointed.

    It has been a long time since I was intimately involved with the innards of relational databases and some of the discussions I heard last week told me the obvious that, while the RDBMS is essential, it is also a relatively mature thing.  That was all before the keynote.  The big announcement that Ellison made was the new hardware device called Exadata and it gave me a whole new appreciation of the complexities behind today’s on-demand applications.

    I am not a database analyst but it looks to me like Exadata might be a new category of appliance that is certainly needed for enterprise IT.  Ellison described Exadata as a database server and not simply a data server and the difference can be illuminating.  Conventional strategy is to bring blocks of data into memory from disk whenever a request is made.  Sometimes the associated data has relevance and the user needs it but often it is not useful and simply takes up memory. 

    Exadata is a creation of HP and Oracle that adds more processors, memory and expanded data pathways to storage to provide a system that can deliver orders of magnitude better performance to database intensive activities. 

    My interpretation of the presentation is that rather than collecting blocks of data the database server collects finer grained fields or maybe rows.  The result is more data that you need and less traffic in data that you don’t need.  This is my crude interpretation and I am not a DBA but if this is close it says a lot.

    Fitting it into the big picture

    The down side of social media is that it captures a great deal of data that must be stored and sorted to provide useful information.  According to Ellison, conventional storage systems slow down at the terabyte level leaving enterprises with the frustrating problem of having rich data but not always having was to access it in a timely manner.

    Although, Ellison never said so much in his presentation, I have to suspect that some of the impetus for Exadata’s development came from the realization that the largest on-demand applications could cause significant problems for the Oracle database.

    I have to say that in the past I have been an unabashed Oracle basher, with what I considered cause — such as the company’s attempt to take over the major front office vendors.  But the last several years have proven that Oracle has been a pretty good steward.  They said that they intended to maintain and enhance the disparate offerings they acquired and that they intended to make integration through middleware possible and straightforward, and by and large they have done these things.  I am therefore reducing my threat level from red to orange and am now officially an Oracle skeptic.  Hey, it’s my job.

    Published: 11 years ago


    I apologize to all my friends and readers who lived through the spamming that resulted from by Facebook account being hacked.  I am hopeful that the problem is now resolved but keep those emails coming if you are getting anything stranger than normal from me.

    Published: 11 years ago


    I tried to wait a bit before commenting on the election and the Social CRM implications partly out of respect and in part to give everyone a chance to rev down.  And these observations have much more to do with social media than with any political party or policy initiative, so please believe me when I say I come in peace.

    According to the New York Times the major candidates and their surrogates spent over six billion dollars on the presidential campaign making it the most lavish in history, if that’s the right word.  If you live in a swing state you were hammered by ads, many financed by big Super-PAC donors.  But looking at the results, especially for big donors as reported again in the Times, the results were paltry.

    So what happened?

    Very simply put, we began hearing the words, “micro-targeting” on election night.  The specific reference was to social media, data capture and aggregation and using analytics to both build models of “ideal” voters and then to find them and get them to the polls.

    Mobile technology was also employed giving field workers maps and walking directions to the homes of their best-case voters.  This get out the vote part of the campaign proved critical to the outcome.

    Finally, if you are Nate Silver, the statistician and blogger for the New York Times, you have to be feeling pretty good at this point.  Silver predicted the outcome precisely only making a wrong call on a North Dakota senate race that turned out better than he’d predicted.  Call it the triumph of the nerds if you must.

    All of the modeling, analyzing and grouping that we’ve seen in conventional marketing over the years got a turbo boost from modern technology this year and it bodes well for both the public and private sectors.

    In the private sector, social techniques have been validated on a major scale.  If you are not embedding your marketing with social technology and most importantly social techniques you no longer have a reason to wait.  Notice I said techniques too because research I’ve done recently shows too many organizations using the technology but clinging to old techniques with miserable results.  For instance using Twitter or Facebook to simply broadcast an unfocused message.  I wrote about this in my first book, “Hello, Ladies!” That has to change simply because using the new technology with the old methods yields mush.

    On the public side, I am going out on a limb.  It’s conceivable that the six billion bucks just handed over to local TV and radio might prove to be a high water mark.  Micro-targeting is far less expensive and more effective and I think the era of big advertising is over in politics as it is in business.

    Also, I think the technology from the general election will, four years hence, be cheap enough to penetrate the primary process even more than it has.  Further use of this marvelous technology will actually reduce the polarization we’ve experienced in the last few election cycles.  Here’s why.

    In primaries it’s widely known that candidates run more to their extremes, Democrats are more liberal and Republicans more conservative.  The reason is simply that primary voters tend to be more passionate about their beliefs, you almost have to be to go out to a caucus for a relatively unknown candidate on a cold January night in Iowa.

    Old broadcast techniques can reliably drum up the most passionate partisans to go to primaries and caucuses but with the down side that candidates win by being less mainstream and it’s the mainstream that votes in the general.  The Obama campaign understood that this year.  With no primary to engage in, the campaign maintained a centrist position, which was enough to win the general.  Micro-targeting worked well enough to enable the president to win all but one swing state, which turned out to be his margin of victory.

    So this election was a great proof point for social both in its theory and its practice.  And not just the social media that many people are familiar with.  It was a big win for analytics and modeling, which means big data too.  We tend to forget about analytics and too often when we think about big data at all it is in line with storage needs, but that is changing.

    Finally, this election gave a big though implicit nod to cloud and mobile technologies.  As mentioned above mobile devices in the hands of field workers made them far more effective.

    In 1952 the fifth machine of the UNIVAC I series was used by CBS to predict the result of the 1952 presidential election.  With a sample of just 1% of the voting population it correctly predicted that Dwight D. Eisenhower would win.  It was a watershed moment for the information age.  It would take more than a decade before computing started to become ubiquitous but it spawned everything around us today.

    This election was just as important but its significance may be leaning in the opposite direction.  Rather than telling us of a new computing trend forming, its real message is the full bloom of the trend that started all those years ago.  And its lesson is that computing is so embedded in our lives today that attempting to live without it is like a return to a world lit only by fire.

    Published: 11 years ago