Experimental Lex

Playing with words.

Tag Archives: riff

The Social/Mobile CRM Opportunity

I keep thinking there is a big opportunity for innovation with social/mobile CRM, though I am still figuring out the details.  Like last time, I think I will just riff on the topic until I get my ideas sorted out.

In the traditional CRM world, businesses are concerned mainly with sales, leads, and marketing campaigns.  For some businesses, CRM is the process of contact management in the context of getting customers and making sales.  From this point of view, a CRM is a system where you can enter and manage data relating to opportunities and leads with the objective of converting leads to customers and generating sales.

Another major area of CRM is e-mail marketing and its offline counterpart, direct mail marketing.  E-mail marketing is a really big industry that continues to thrive.  10-15 years ago, there were startups making it big by offering tools that helped businesses manage and send email blasts.  In fact, I had the privilege of working with Rosalind Resnick a few years ago.  Rosalind pioneered opt-in e-mail marketing through her company NetCreations.  She took the company public in 1999 and later sold it for $100+ million and only moments before our beloved Internet bubble had burst.  Not too shabby.

Today, I still hear stories about young (and old) entrepreneurs building startups that help businesses with e-mail marketing campaigns.  And I get especially annoyed when I hear stories from teenagers talking about making their first $million by age 18 doing exactly this. (i hate them)  If there is a lesson here (besides drop out of college and build a startup), it is that e-mail marketing will continue to be a powerful and obvious channel.  To reach the inbox of a person who has not explicitly unsubscribed is like a perfectly targeted Google ad.  The nonstop brand awareness you get is worth it and it might lead to a conversion or two.

There’s really too much information to cover on the topic of CRM systems and e-mail campaign management.  I will just say that tracking and measurement of user actions in e-mail campaigns is the critical thing.  When you open an email, that activity is tracked as an “open” event and later reported as part of the e-mail campaign metrics.  When you click on a link in a campaign e-mail, the activity is tracked as a successful “click” event.  The laborious effort of creating and delivering an e-mail campaign is validated by successful “opens” and “clicks”.

Each the CRM models discussed above is focused on a transaction within a workflow.  A new opportunity or lead is entered into the CRM, which triggers a series of followup interactions with the objective of generating a sale.  A marketing campaign that generates new website registrations (also a transaction) has the objective of converting the new registered users (aka, leads) into real long-term customers.

With this speculative social/mobile CRM opportunity, the same basic guidelines apply, although the contact management and end-game are different.  Whereas traditional CRM is focused on eventually making a sale, social/mobile CRM is more about customer service.  At the core of social and mobile technologies is the ability to interact and share while you are “on-the-go”.  In this mode, buying stuff online is not the priority.  Often, it is something that you need in the moment.  Such as, answers to questions about how to get the thing you need.

Thus, social/mobile CRM looks like another branding and customer service exercise.  Is that all there is? Perhaps.

It all depends on whether you can guide the customer down a conversion path.  Not necessarily a path to buying stuff.  The real conversion would be social sharing.  Social media is all about the network effect.  If you can get one person to share with a few more people, the overall effect can be 1,000 times more powerful than lead generation and another 1,000 times more powerful than sales conversion.  The real objective here is to understand and collect as much social data as possible.  If you walk away from the campaign with thousands or millions of new social contacts, that’s a mighty powerful thing.

Riff on Internet Startups

Alas, I am reduced to this.  I haven’t written anything in months while I have pursued my elusive dream of startup fame and fortune…  Still working on it… And so I am writing this blog post to get some thoughts out of my head and perhaps find some clarity amid the fog of ideas.

The year is 2011.  Look back 10 years and think about what was happening then.  Our first grand Internet bubble had burst and startup companies were dying everywhere.  Hundreds of millions of dollars of venture capital investments suddenly disappeared.  A few companies were able to survive, but they had to cut costs drastically.  That meant continuous layoffs and very little hiring.

If you were an entrepreneur or part of a startup back then, you were well and truly fucked.  Nobody wanted to invest in anything.  They called this period the “nuclear winter” for startups and venture capital.  I think Marc Andreesen coined that term.  I remember a funny Internet meme at the time.  It was the quote “Please God, give me just one more bubble”.  The brilliant Paul Kedrosky turned it into a bumper sticker which you can find here on CafePress.

Well my friends, ten years later, we have our new Internet bubble.  Let’s not debate whether this is or is not a real bubble.  It won’t be the same as the last one for all the reasons that have already been said. Let’s just say that this is an extremely favorable time for getting funding for startups.  Some say this bubble will last through 2013.  If you waited ten years for this bubble and now it is here, what are you going to do about it.

You might say to yourself, “I sure as fuck will not miss this one”.  That’s what I’m saying.  And yet, you should carefully plan your approach to taking investor money and launching your business.  If you look back at the great Internet companies today, most were founded after the first bubble had burst or were quietly getting started (i.e., Google, Twitter, Foursquare, Facebook).

Do you want to be one of the startups that got funded, launched big and then flamed out?  Maybe that’s better than nothing.  My feeling is that there will be plenty of flameouts and I wonder if any of the founders will walk away with any money or their reputations intact.

It seems to me that it would be better to create something of value and look for the fastest and best exit strategy.  Take the cash off the table while you can and save it up for the post-bubble.  After the bubble, talent will be cheap, new opportunities will arise, and it will be a very good time to have some dry powder in your guns.