Just over 6 years after Jack Dorsey posted the first tweet, Twitter now has more than 500 million users and more than 250 million tweets are sent each day.  Pick up a newspaper on any given day and you're likely to find Twitter in the headlines; whether it’s over the social media giant’s refusal to hand over tweets by Occupy protesters to the police, or the terrible abuse a footballer has suffered after a controversial team selection.

Dorsey himself remarked that the name 'Twitter' was perfect for the service as it meant  'a short burst of inconsequential information' - exactly what the site enables the user to share with the world. Yet it does so much more.

It is the #1 source of breaking news for millions.  I first learnt of last year’s devastating tsunami in Japan and the demise of Osama Bin Laden through Twitter and I followed developments not on a news site, or even Facebook, but through tweets. I’ve followed the Leveson inquiry into the hacking scandal, or #hackgate, mostly in 140 character bursts.  I was in the pub the other day and I asked a friend for the latest football scores and he chose to check Twitter over the numerous dedicated football apps because “you usually hear about goals on Twitter before those apps get updated”. Twitter allows real-time conversation between people sharing experiences.  It enhances those experiences, often becoming more talked about and entertaining than the event or story itself.

I'm not going to list all the reasons why Twitter is great. Instead, this post is to start a conversation on an endemic failing that is appearing: the repeated ‘trending’ of dull, offensive or inappropriate hashtags. 

For those not yet infected by the Twitter bug, adding the # symbol in front of a word or phrase makes that tweet appear when someone searches for those words or phrases in Twitter. If enough people talk about the same thing in their tweets, those words or phrases will trend, meaning they appear on the Discover page, driving even more people to participate. This matters because it’s a really useful way of following particular issues that you care about (including the examples above and below), and Twitter identifies the most popular ones as ‘Trending’.

Unfortunately, Twitter and its users are done a great disservice by the all too frequent trending hashtags that undermine the service and the intelligence of Twitters users. Today is a perfect example. 

As I write this post, #undertheinfluenceplay and #questionsihatebeingasked are trending. The former stream largely consists of links to porn and some sexually charged tweets; the latter a mix of questions like ‘Are you a virgin?’ and ‘Who’s your least favourite member of One Direction?’. There is little clever or funny about the vast majority of the tweets on display. Regular tweeters will surely have noticed that this is a daily occurrence. The topics usually revolve around sex or race (or both as with #thingsblackgirlsdo...) and must make Twitter's founders cringe as much as they make me despair. Whilst I’ll admit that the odd #meme makes me smile; the vast majority just add to the noise, and actually make it harder, not easier, to discover the good stuff. 

Sure I can just ignore these topics and stop following people who continuously get involved in them.  But I can't help but think, Twitter deserves better. Real tweeters deserve better. So I thought I’d share a few uses of the # that I think Jack Dorsey would be proud of; and ask you to share your own in the comments. Who knows, maybe we’ll help to achieve a #cringefree day.

1. #InstagramYourCity - The Social Media Week organisers are encouraging people to capture their cities using their iPhones and share them on Twitter. The best pictures will be showcased at the events and one lucky iPhoneographer will win a trip to the Social Media Week city of their choice.  I like this because it taps into a popular activity and encourages people to get out and catch their city at its best.
2. #40dollars - To counter a Republican tax proposal the Obama administration encouraged people to tweet what $40 meant to them - which was the amount the Democrats claimed ordinary folks would lose out of their weekly paycheck if the proposal succeeded. At its peak the campaign was generating 6000 tweets per hour. It was a great way of getting the politically disillusioned public to think about the impact of policy.
3. #HiddenCrisis - Twitter chats are perhaps one of the best uses of the # on Twitter. Save The Children hosted a 12 hour global chat to raise awareness of malnutrition in children. It involved 50 moderators and guests included many distinguished political leaders.
4. #FairTweets - To raise awareness for World Fair Trade Day, Ben & Jerry’s encouraged Twitter users to donate spare characters in their tweets to promote the cause.  So if I only used 60 characters, the remaining 80 were used to promote Fair Trade. They built a page where users could enter tweets and the rest was done for them.
5. #PrayforJapan and others - This is where the hashtag really comes into its own. After the Tsunami last year people took to Twitter in huge volumes, to the extent that particular issues generated their own hashtags. #PrayforJapan was a great source of helpline numbers, and information about relief and emergency service access. The disaster brought out the good side of people on Twitter helping each other.

We have only just begun to scratch the surface of opportunity for hashtags – not only for helping to identify relevant information, but building communities, communication with other online services, enabling transactions and a whole bunch of ideas I haven’t had yet and will make someone else rich. It’s a shame we have to tolerate lowest common denominator content in what should be ‘the best of Twitter’ in the meantime.

Alexis

 

Businesses get caught up in their own brilliance. This danger is particularly acute in industries like technology, communications and finance, where "being clever" and delivering "the latest thing" is particularly prized. With obvious (and very successful) exceptions, these industries build too many camel/bicycle hybrids, and not enough horses. We, as users, get lumbered with having to figure out how they work.

So in no particular order, I don’t believe that most people understand the difference between the Nokia X7-00 with Symbian Anna OS (upgradeable to Nokia Belle OS) and the Sony z525 with a second CSTN 4096 colour display (I think that means it’s got two screens). They are completely confused about what on earth the £26 Orange Raccoon pay monthly mobile phone plan is, and why I should take it over their £31 Panther plan. Even the more numerate amongst us start losing the will to live when trying to understand the 36 page booklet explaining Halifax’s fixed savings account that allow you to change how long you save, how often you get paid interest, has three different interest rates for every combination of these, and enters you into a prize draw in its spare time, but doesn’t let you take you money out when you want.

People working in these industries slip into a naive belief that customers are as interested in their product as they are – whereas the reality is most people want to go see their friends and family, not worry too much about money, look after the people they care about, and to have fun now and then.

The reason this happens is twofold: over-enthusiasm by the people designing the product, and the abdication of responsibility by senior management. The former is easy to understand, work is very painful when you don’t feel excited by what you are doing. The latter is feature of the way most businesses are run. The single most important priority for a business is the product it sells – far too frequently this gets delegated way down the organisation to a world of project management, requirements documents, and status meetings.

So how do you solve it?

Accept that what you do is boring
Unless what you are doing is the subject of hilarious dinner party anecdotes, then the reality is that most of us spend our days doing things customers don’t care about. Customers would like your product to do what it said it would do, in the shortest amount of time possible, and with the minimum amount of their input. You may revel in the incredible genius of a new gadget, or a pricing plan, or an app that connects everything to everyone, or a low risk/high reward savings product. Customers do not want to have to work your product out, they couldn’t care less about the list of features, and they certainly aren’t remotely interested is just how complicated the whole thing is. Showing how clever you are may fulfil you – it just annoys your customers.

Your job is to take complexity away from the customer. Your job becomes interesting when you deliver something brilliantly simple. Payment processing couldn’t be more dull. The person who came up with one-click ordering is welcome around my house any time.

LoveThis has a very clever system, which you couldn’t care less about, that allows you to discuss a recommendation with anyone using either their email, iPhone, or Facebook account. This means that you don’t need your friends to be registered with LoveThis to be able to discuss your recommendations with them. Great, except that in the first version we shared a chunk of that complexity with the customer. We were seduced by the "brilliance" of what we were doing. Now we’re having to sort it out – not quite one click yet, but working on it.

Understand that one more feature will make it worse
There is a temptation to add "just one more feature". This can happen for a number of reasons.

In big businesses, the product development process encourages every department to chip in with their wish list and then negotiate a design. The people who see the whole picture (the senior management) sit on the metaphorical top floor and delegate this negotiation to project managers. It’s not a surprise that the best consumer product development company in the world, Apple, was run by an obsessive control freak with an incredible eye for detail – Steve Jobs told everyone else what to do. In most big businesses, the CEO delegates the product through about five layers, to a manager who runs around trying to keep everyone happy.

In a startup, the founders believe that “this extra feature is just so cool/useful/clever that I can’t leave it out”. The problem is that that "cool feature" adds complexity.  One of the more fun jobs I’m having is reducing the features of LoveThis. If you’ve spent months designing a product, it’s difficult to imagine anyone wanting less. We’re spending this week taking things out of the homescreen and giving fewer ways of talking to your friends.

The rule of thumb is, if you’re ever faced with a "should I include this" decision, then don’t.

Assume you’re wrong.
Listen to your customers. This isn’t easy. If it’s your own company, your friends, family and team will be telling you how great your product is. It isn’t. If you’re a big company, no-one will want to say that maybe the six-month design and 12-month build didn’t come up with the best answer. The project manager believes they have the best compromise, the product manager has been beaten into submission and is defending the indefensible, and the tech team are just glad it’s all over.

The good news is that customer numbers don’t lie. If customers aren’t using it, it isn’t interesting, it doesn’t work, or they can’t find it. In a world where information is shared so quickly, it’s probably not because marketing haven’t got their act together.

When your customers tell you something, do something about it. LoveThis launched three weeks ago; the radically simpler home-screen will be released next week. There’s no reason why big companies can’t do this as quickly – the problem is that senior management need to take the decision. Because their involvement in the product in the first place was through a steering committee of the great, the good and the barely engaged, they don’t understand the detail, so it’s much easier to drop the price or spend more on marketing or shout at sales.

Your product is the most important job you have. It requires you to be evangelical, stubborn and humble all at the same time. The best products are so simple they can be used by two-year-olds. Do more, so your customer has to do less.

The great things about recommendations from friends is that they are personal. Which is why the top 10 tech recommendations amongst friends this week on LoveThis probably looks a bit different than the standard Top 10s you'd see elsewhere...

Jawbone Jambox

They look like big bits of Lego, but they're really a toy for adults (no not that kind of toy. A toy for your ears. Oh never mind...)

Minox BV 10x42 Binoculars

I'm sure this means we have a lot of wildlife and hiking enthusiasts as opposed to peeping toms...

Sky Anytime Plus

Our users are clearly advocates of the 'on demand' era...

iHome iW1 Airplay Wireless Audio System

Another music system.  LoveThis users obviously like their tunes.

Macbook Air

Sometimes the most popular products are just the best. (I have one and recommend the Knomo messenger bag for lugging it around...)

Canon S100 Camera

Don't think I'll ever look past the iPhone again as far as photos go - but guess if you're into more serious snapping a dedicated shooter is worth having.

Jawbone Jambox

Another music system.  LoveThis users obviously like their tunes.

Chrome Messenger Bags

Garmin 910XT

You really can tell a lot about people from what they recommend.  Something tells me LoveThis users are data junkies...

Nespresso Citiz by Magimix

This looks very cool - but it must back a good cup too if people are recommending it...

Sennheiser HD 25 SP headphones

I'd recommend Sennheiser myself - solid headphones in my experience. And our users clearly feel the same...

 

Seeing all the great things people recommend certainly does make you wish you had more spare cash :-)

Dave

Just when you were getting bored about whether we’re in another tech bubble, Facebook has reopened the discussion in dramatic fashion – buying super-hot photo-sharing app Instagram for a reported $1 billion in cash and stock.

Normally the question would be “is it worth it?” But this time, few in the tech world are even asking that: they’re just a) saying it’s not, and b) predicting a mass exodus of customers who don’t want to be associated with a "big business" like Facebook (who appear in danger of becoming the Microsoft of the social age).

Instagram has been a phenomenal success recently. They only had seven people working for them at the end of last year. When they launched an Android app a few weeks ago it saw 1 million downloads in the first 24 hours.  The iPhone app already has over 27 million users. But a billion dollars? Why (and I’m not even mentioning direct revenue, as Instagram hasn’t got any)?

1. For the talent. It is incredible that such a small team could grow a company to north of 30 million customers in just over one year. They are the first true success of the lean start-up approach. Clearly Kevin Systrom and co are a very talented bunch. But they’re not that good.

1. For the technology. There has been speculation for a while that Facebook would launch a dedicated photo-sharing app. Photo-sharing was key to Facebook’s early growth but their mobile products have, so far, been limited.  They bought the messaging app Beluga and soon after launched their standalone Messenger app (which was very similar to Beluga). Buying a popular app is easier than building your own from scratch. But it appears from noises made by Facebook/Instagram so far that Instagram will remain a standalone app; they’ll just "increase their ties to each other".  It wouldn’t surprise me if there’s a U-turn here down the line.

1. For the users (or rather their activity). I doubt there are many people who are Instagram users but not Facebook users (other than a few who have left Facebook in protest over the years). I don’t mean to suggest I’d buy Instagram to acquire customers for Facebook. Instead I’d buy it for the user activity. Instagram is white-hot. Back in August they were reporting one photo upload for each of their seven million users every five days. Now they’re at about 30 million users, including a few million Android users who have been chomping at the bit for months and are no doubt sharing like crazy: that's an awful lot of uploading and viewing. Facebook is an advertising platform, and to sell advertising, you have to have "eyeballs". Instagram has a lot of those, especially in core markets (US and Western Europe), where Facebook’s core product has been declining recently. Tight Open Graph integration could provide a huge boost to activity levels within Facebook.

Perhaps there’s another way to look at it. One billion dollars makes no sense. But as Facebook are paying largely in equity, the more relevant question is: if Facebook is worth £100 billion, is Instagram worth 1 per cent of that? Quite possibly – in which case, the issue is Facebook, not Instagram.

A while back I wrote a blog about “40-year-old marketing directors not understanding social media”. It sparked a lively debate. One of my arguments was that many of today’s senior marketing execs had entered marketing precisely to avoid the focus on numbers and metrics that have become today’s basic marketing tools. I was obviously generalising, but many agreed with me. There were three broad responses:

1) “Don’t be so ageist. It’s not age, it’s experience that’s relevant”. I agree, but the point still stands.
2) “I totally agree. I/my boss (delete as appropriate) doesn’t have a clue, but can’t admit it.” A surprising number of senior managers asked where they could ask the stupid questions on this stuff.
3) “What numbers and metrics should I be focusing on?” That's the question I'll be answering now

Every business measures "KPIs". For those lucky enough not to have come across the term until now, KPI stands for "Key Performance Indicators", and it’s based on two ideas: 1) measuring something makes it a lot easier to manage, and 2) if you focus on a small number of the most important things in a business, then you’ll be more successful. I believe in both.

KPIs are supposed to measure the most important things in a business. They are useful for getting a whole business focused on delivering the really important things. However, KPIs have now become horrendously misused to include just about any number anyone senior cares about, someone in finance can measure, or someone in the middle just finds interesting.

People appear to have forgotten about the “Key” in KPI.

I’ve worked in a business with a weekly KPI pack that was 80 pages long. Every week the most effective people in the business were rendered entirely ineffective analysing (or more accurately, justifying) vast quantities of numbers, with no shared understanding which numbers were the most important.

There’s nothing like leaving the comfort of the corporate world to get you to focus on what really matters. The limited resources of money, time and manpower require you to focus only on the things that will make your business successful.

I’ve come to the conclusion that for a consumer-based business there are five KPIs that every business should understand, measure, and manage. Everything else is a nice-to-have.

• Does the customer like your product?
This is blindingly obvious, but actually measuring how much your customers like your product seems to slip by many managers (mostly because they are convinced of their own genius when it comes to building a product). Your product is the most important thing to worry about – if it’s worse than the competition, you will fail. If it’s better you will probably succeed. It’s that simple. Measuring it boils down to two things: "Do customers enjoy using your products?" (ie will they buy it again), and "Would they recommend it to their friends?" (ie will they help you grow).

You should understand not just whether customers are using your product but how they are using it. If you understand this you will soon understand what your customers want and you can tailor your product accordingly. This allows a constant cycle of testing and learning – you rarely get it right first time.

• How good are you at getting new customers and keeping them?
You need to understand how efficiently you are winning customers from all your sales channels. Think of each channel like a funnel: 100 people turn up at your website/shop/salesperson; of these, 50 walk straight back out again, the other 50 start browsing; 10 add something to their basket; two proceed to checkout; and only one buys. This sort of drop-off is pretty common, but understanding it allows you to decide whether to spend a lot of money getting people into your shop (which is sexy marketing stuff) or, as in this case, to present products better and make the checkout more convenient (which isn’t sexy, but works). Knowing exactly where in the funnel you are leaking potential customers allows you to quickly optimise where you spend your money.

The customer retention funnel is equally as important – it’s a lot easier to keep a customer than win a new one. A service provider should know how many customers stopped using their product in the last period, and should measure the effectiveness of efforts to keep those relationships.

• Can you sell it for more than you can make it?
Anyone can sell £1 coins for 90p. It seems crazy to have to point out that a business will only work if it costs you less to produce and sell your product, than a customer is prepared to pay you for it, but lots of businesses fail because they failed to add up.

People are normally pretty good at knowing how much it costs to make something. They are frequently awful at assigning marketing and sales costs to each customer or product. A 25 per cent margin on a widget can frequently be a loss when you include distribution costs, commission, and marketing.

This applies to each customer as well as each sale of the product. Does each customer you win end up paying you more or less than it cost you to win them in the first place? This is especially important in businesses where customers pay you over a period of time. I’ve attended numerous meetings talking about how inexpensive it has been to get customers from affiliate web channels compared to, say, Carphone Warehouse. But if those customers from Carphone spend five times the amount or stay twice as long, then the investment was worth it.

• Can you deliver on time?
Time, quite literally, costs money. In a large company it seems like it doesn’t matter if a project is a few months late; that’s the norm. In fact there’s a whole art form in big businesses to moving the goalposts so that a project never actually appears to be late.

In a startup, if you don’t deliver on time, you’ll run out of money. All new businesses need a runway from which to take off, and the length of the runway is defined by the amount of cash you’ve got.

Every day of delay shortens the amount of time left to get the business off the ground. As a result, delivering on time is an absolutely vital skill, even if it means delivering something less than the "full" product. Startups frequently talk about the Minimal Viable Product – your first version should be as small as possible (not least because customers are a lot better judge of what is vital than the CEO or product lead). This means measuring how long it takes you deliver, ensuring you keep to those deadlines, and constantly looking for ways to reduce scope and increase speed.

• Cash
Business is simple. People (investors, banks, family and friends) give you cash. In exchange, they expect to be given back more cash in the future. Running out of cash is ultimately what will kill your business. The ability to generate cash will make it succeed. It doesn’t matter whether you are a start-up or a multinational, or whether you’ve got an accountancy degree, cash is everything. Measure it. Hoard it. Get it in quickly, and spend it slowly.

You should be able to fit these on one sheet of paper. Everyone in your company should think about what they do in the context of these numbers. If you deliver against them, you will have a thriving, profitable business. Measure them, then manage them.

It seems that every single day an app or web service is launched that is ‘disrupting’ its industry and is primed to be The Next Big Thing. Nothing new there. But the one thing that has struck me recently is the extent to which the tech press and bloggers and the Twittering public focus on the design of the user interface (i.e. it’s beautiful) and not much on whether the app is actually disruptive (i.e. it’s solving a genuine a customer problem or, even better, it entirely changes the way we think about the problem). 

Ask most people “what was the best app of the last twelve months?” and they’ll probably answer Path or Flipboard or Pinterest. What do these apps have in common? They are beautifully designed.

But are any of them truly disruptive? Do they do solve a customer problem fundamentally better than the alternatives?  I’d argue that users read less content when using Flipboard over say Byline (which is nowhere near as beautiful, but is simple and works better). But Flipboard looks and feels great to use. It is shiny and we like shiny things.

Pinterest is equally pretty and taps into an innate desire humans have to curate and share our perception of self. But whilst entertaining, and even compulsive, I’m just not sure it actually solves a problem any of us had (unless it was what to do when bored at work on a Wednesday afternoon). It’s supposed to allow you to “organize and share things you love”, but I can’t ‘pin’ things that don’t have a URL and it only works for items that are photogenic themselves.

It’s a shiny service for shiny things, and I’d like to think I love more than that.

Path is a beautiful app. Apparently, the pop-out ‘+’ button alone took 3 months to design and code. But again, most of the gushing coverage it received focused on how beautiful it was; not on whether it was actually worth using. I’m not sure that it would have received the plaudits it has if it was a bit uglier. The service itself is just not that useful over and above predecessors like Facebook. Especially since their historic USP of respecting users‘ privacy was undermined during the recent iPhone Contacts controversy. 

I’m not intending to have a pop at the apps themselves, good design is a extremely rare and valuable skill, and we’d all rather have something beautiful all else being equal. Rather it had always been a strength of the tech world that it was driven by a ruthless Darwinian survival of the fittest, and it’s somewhat depressing to see it succumb to survival of the best looking. 

I think this is a passing fad, and is a reaction to years of horrendously unfriendly tech design. Design will always be important, but truly disruptive apps like IFTTT, Basecamp and Dropbox are the the ones I’m banking on to be around and thriving in years to come. Focus on solving the customer problem - you can always repaint something that works.

The tech community have been up in arms recently over the antics of Path and Pinterest, two relatively recent darlings of the tech world.

In the case of Path, who were heavily criticised for uploading consumers’ iPhone contacts to the Path database without warning, the backlash resulted in humble apologies and Apple suggesting they would start to enforce guidelines requiring apps to ask for users’ permission to store their contacts. This was after the admission by many others, including Twitter and Hipster, that Path was far from the only one doing it. The noise around Pinterest automatically changing users’ links, in order to profit off of them through affiliate network Skimlinks, was somewhat less ferocious (Pinterest CEO Ben Silbermann insisted that the use of Skimlinks was just a test and they had ceased using it before the story broke anyway).
These sagas illustrate two interesting points:

• That emerging consumer tech start-ups are heavily beholden to the goodwill of their users and tech influencers, particularly the tech press
• That users are not so much concerned with what these businesses do with their data or how they plan to make money as with whether they are upfront about it

The first point stems from the fact that emerging consumer tech businesses fundamentally need two things; user growth and a revenue model. The former costs a fortune to achieve directly so services like Path and Pinterest rely heavily on two things; "member-get-member" marketing, and the buzz created by influencers and the press that often ignites, then boosts it.  The likes of Path and Twitter store users iPhone contacts in order to stimulate growth by notifying you when your contacts join, or prompting you to invite more of them.

And can you blame them? Path has suddenly grown to over two million users (driven in part by a change from a softly-softly private approach, to exactly the sort of aggressive tactics they’ve been found out for). However, in the age of stratospheric numbers such as the nearly one billion users Facebook has amassed as it approaches its IPO, they need to be seen to be continually growing in order to be press and investment-worthy. Uploading contacts from a user's phone without their consent isn’t acceptable, but as a founder of a consumer technology service myself I can understand the pressures they are under to keep the graph exponential.

Pinterest has the opposite problem. They have been growing ridiculously fast recently, getting to 10 million users faster than any other standalone site ever, according to comScore. They have been lavished with praise by everyone that matters in the tech world; even Mark Zuckerberg signed up. But Pinterest reportedly failed in early attempts to raise funding because they had yet to discover a convincing business model and, despite now raising significant funding, they still haven’t.  I’m not sure I buy Ben Silbermann’s story that Skimlinks was just a brief test; I can however understand the pressure $37 million of venture capital backing puts on you to find a way to make money.

Consumer tech businesses are beholden to users and the press because they rely on them to fuel growth and because only if they approve of the way the service will make money will that business plan succeed. This is why Facebook is handling the launch of mobile ads with kid gloves. Even the behemoth that is Facebook has to tread carefully if it is to continue to add users and revenue, which will determine its share price.

The second point is perhaps the most interesting. It is striking that it was not the storing of iPhone contacts, nor the editing of user links, that irked most who spoke out against Path and Pinterest. What people really protested about was the fact that Path didn’t ask permission to do so; and Pinterest wasn’t up front about how it was making money.

Alexia Tsotsis of TechCrunch accurately pointed out that Path’s behavior annoyed users in particular because they had set their stall out to be a private and trustworthy alternative to giants like Google+ and Facebook. What this suggests is that today’s socially savvy users understand the pressures start-ups are under to grow and make money, they understand that innovative and disruptive companies change industries and in doing so change the way businesses make money, they even largely see the benefits of handing over some data to these innovators in order to improve the service they signed up for. All they really want is to be in control of their data and for the businesses they help grow to keep them in the loop.

This is a fundamental shift in the way marketeers approach selling their products. For years it has been a case of how to find the most positive statement about your product without actually lying (“The World’s Favourite Airline” springs to mind). In other words marketeers had to tell the truth, but to suggest the whole truth would have been regarded as naive.

The pace of transformation is so high that it can be a significant challenge knowing how to communicate all this change to consumers. Marketeers have a new rule to live by: the truth isn’t enough – the whole truth is required.

A month into 2012 and I’m bored of the ‘Top tech trends for 2012’ lists. It is vital to have a view of the future, especially in the tech space. But the annual trend list season does bring to mind the Baz Lurhmann lyric: “advice..is a way of fishing the past from the disposal..painting over the ugly parts..and recycling it for more than it is worth”. Trends lists purport to be about the future, but more often are a recycling of what’s already happened. As such they are more about this years followers than leaders.

It seems like the ‘next big thing’ is launched on almost a daily basis. But only a very small few actually go on to become even a medium sized thing. There are many reasons why, but it seems like an increasing number of consumer tech start-ups have a strategy and product design based on those ‘trends to watch out for’ articles. Location-based, check. Mobile payments, check.  Syncs with the cloud, check. Social, check. Then launch a product that is far too complicated, makes people go “oooooh” and “aaaahhh” once, and is never used again.

On that basis, if you feel like making an easy billion, what business should you launch this year?

It should enable a ‘second-screen experience’. It will be integrated for you across Facebook and Twitter, whether you like it or not, so your friends can ‘seamlessly’ know your every move in a frictionless manner. It’ll be hyper-local giving you access to deals and you’ll be able to pay for things through it – probably using Facebook Credits and other social currency too. It’ll use some fancy formula to crunch the data collected above and tell you about something you’ll like or that will save you money. Oh, and of course you’ll be able to talk to it. And wear it. 

But, of course, the tech space doesn’t work like that. The best new tech businesses don’t tick the latest trending boxes. Instagram proved that last year; photography apps weren’t a trend to watch back in late 2010. Sure they had some nice social features but mostly Instagram just kept things simple (they only had 7 employees up to December); and did one thing very well - allowing people to take and share beautiful photos. Turns out 13m customers agreed.

If the sum of your features doesn’t add up to a better solution than the alternative (including just not bothering…), then you’ll fail – no matter how many trend boxes you can tick.

The best ideas this year will not come from the herd following trends, it will be because a person out there connects some seemingly unrelated pieces of information, and comes up with a very simple way of solving a problem we all have. Afterwards we’ll think it was obvious, they’ll make a fortune, and we’ll talk about it after the event, in 2013’s trends.

Many marketing and social media manager’s new year bonuses will have been based on generating a meteoric rise in the number of Facebook Likes or Twitter followers. There will have been lots of pats on the back for that iPad 2 competition that earned 100,000 followers in less than a week, or that new landing tab that forces people to Like the brand in order to enjoy the juicy discounts within. A quick Google search for ‘iPad 2 Facebook giveaway’ gives you an idea of the popularity of such a tactic. Can we really value a ‘Like’ or a ‘Follow’ when so many of them are bought rather than earned?
I’m not talking about the value of a Like to brands here. Indeed, amassing Likes can be worthwhile for brands if they then focus on building a community. Experian Hitwise calculated that a Like generates 20 visits to brand sites; Deals platform ChompOn reckons a Like is worth $8, a Twitter follow worth $2 and an individual tweet worth $2 in additional sales of deals on its services.
Instead, I’m talking about the value to the consumer and their friends.
A Facebook Like is supposed to show a user’s approval of a brand, product or piece of content. So if I see my friend Jane has Liked Chanel on Facebook I should be able to assume that she rates that brand and that Chanel No5 would be a good birthday present. But, if a recent study by the CMO Council is anything to go by, Jane was nearly twice as likely to have Liked Chanel to enter a contest than to show her affinity to the brand. So maybe it wouldn’t be the ideal gift after all. Italian restaurant chain Prezzo has 117,000 facebook fans. If nine of my friends are among that number, I might take that to mean that Prezzo is worth a visit. But what I might not realise is that Prezzo recently gave away an iPad 2 for every 5,000 new Likes they received. They gave away eight iPads and ended up at over 107,000 Likes. No doubt this was a worthwhile exercise for Prezzo as a business, especially if they consistently engage the followers they have bought. But it can mislead users and cheapens what it means to "Like" something.
This is especially so since the introduction of Facebook’s Sponsored Stories. Prezzo can pay to advertise each user’s Like to their friends, passing it off as an endorsement for the brand when many of those Likes were in fact endorsements of Apple. Sponsored stories will soon appear in your Facebook news feed, making it hard to distinguish between your friends' opinions and marketing strategies.
I can’t say I blame brands for such tactics. Building a real community is hard work and takes time. Nor are Facebook Likes the only social currency that can be misleading. Incentives are a common way to drive up Twitter followers, get positive "customer" reviews, posts and tweets and generate word of mouth. Sites like ReviewMe and Buy Twitter Followers even allow you to skip the incentive and buy results.
Thanks to these strategies, Facebook Likes are a pretty meaningless reflection of the products your friends actually like. The exception to the rule is web content, which is where the Like really works. But for products, services and brands, the Facebook Like provides little indication of what your friends want or would recommend. In the quest to be endorsed on Facebook, brands have devalued those very endorsements. Buying a Like doesn’t mean you’re liked.

A few weeks ago I wrote that 40-year-old marketing directors didn’t "get" social media. It struck a nerve. Many social media marketing managers agreed and aired their bottled-up frustrations with bosses who weren’t prepared to learn.

Meanwhile, some "40-year-old marketing directors" were offended. (For the record, I’m 40 too – it’s about attitude, not age), but a surprising number admitted they were struggling.

A recent IBM survey of 1700 chief marketing officers (CMOs) around the world suggests I was on to something:

Social media was found to be the second biggest challenge for today’s CMO.  But what struck me more, was that this was second to the challenges posed by "data explosion".

The term "Big Data" has been part of the tech industry’s lexicon for some time and its use has certainly ballooned in 2011. In 1953 the entire contents of the digital space totalled about 53kb (most emails you’ll send today are bigger).  Today Twitter alone generates more than 20 terabytes of data every day. The rise of social networks, RFID data tags, e-commerce and so on has meant that the amount of data available to anyone with a PC (or even a smartphone) is colossal. The man responsible for a significant contributor to the data explosion, Mark Zuckerberg, suggested that people will double the amount of information they share online each year. This was coined "Zuckerberg’s Law".

Why is data such a challenge? There’s too much of it, so what should you look at?

Let’s say you’re the marketing director of a consumer goods company. You know how many visited your website yesterday. You know how many people talked about your brand on Facebook or Twitter. You know which products were bought at what price, through what sales channel, and at what discount. You know who has called your call centre, and about what. You have demographic data. You’ve segmented your customer base into groups of customer that think or behave differently. You’ve got all this information for each of these groups. You get a lot of this information every week, or even every day.

I once worked at such a company. It had a weekly reporting pack for consisting of over 80 pages of data. (As an aside, there seems to be a widespread condition in which the amount of analysis being applied to a problem is in inverse proportion to the amount of common sense that gets used – “Dormandy’s Law”, a subject for another blog perhaps).

The single most important job of the chief marketing officer (CMO) is being able to make sense of this information, to identify what is relevant, and to drive the agenda of the business around those things. If your CMO finds this a challenge, then you’ve got the wrong CMO.

Even once what’s important is clear, you are still faced with how to measure it. The mere fact that you can measure something, or divide one number by another, or report on something regularly, does not make it useful. The details matter.

Say you decide average customer spend is important. It’s no use knowing your average customer spends £10 a week with you if, in fact, you’ve got 100,000 people spending virtually nothing, and 1,000 very valuable customers spending £1,000 each. This is what actually happens in gaming companies. As a CMO or Marketing Director you had better understand this detail – exactly what to measure and how to measure it. The most important question is: what do you do about it?

We are paid to get things done. The final challenge for senior marketers is how to go from a huge amount of information, to an organisation that understands and measures the important things, to people turning up on Monday morning to deliver things that make a difference.

This is a challenge, and managing it takes a particular mindset. It is unsurprising that some of the most successful senior marketing people today spent the 90s working in direct marketing  (and being looked down on by creative colleagues who regarded them as too "salesy"). The people who learnt their trade in direct marketing are used to managing things by measuring them; to testing, measuring, learning, then testing again; and delivering a brand in a way that gives a clear return.

The good news is that if you can solve the challenges posed by the explosion of data, it can add significant value to your business.  Those who use data intelligently can use networks like Facebook and Twitter to acquire more customers more cheaply, and sell more relevant products. Netflix is using the customer data it collects to commission original shows, rather than just buy the latest series off the HBO production line. Mobile companies are saving a fortune by reducing commissions for customers who always hunt the best deal, and instead are spending it on loyal customers who cost them far less.

The really good news is that managing all this information will require skills that are in short supply. Millions of new managers (and that’s an estimate from McKinsey, not my hyperbole) are going to be required to make decisions and manage businesses on the basis of big data. Whether you are 40, 20 or 60, brushing up on those quantitative analytical skills seems like a good idea at the moment.