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June 14 2011

3 ideas you should steal from HubSpot

HubSpotI've been following Dharmesh Shah's OnStartups blog for years and I remember when he announced HubSpot, the company he was starting. I've been fascinated to watch it grow and grow, so I was excited when I got to visit their offices a few months ago. Just after my visit they closed a Series D funding round for $32 million from Sequoia, Google Ventures and Salesforce.com, but despite its success almost nobody in the technology world has heard of HubSpot. I blame the combination of a location in Boston and a mainstream customer-base of small business owners for the lack of recognition. It's a shame because there's a lot to learn from their technology and process — they've solved some hard problems in thought-provoking ways.

People are fascinated by mirrors

There's a good chance you've used their Twitter Grader tool, and its popularity shows one of the secrets to HubSpot's success. The inspiration for the company came when Dharmesh realized that his own blog was driving a lot of traffic, and the startups he was helping out were all struggling to get anywhere near the same number of visitors. He built HubSpot by applying what he'd learned from blogging, and one of the key lessons was that people crave new information about their own lives and projects. If you can create a service that gives people interesting data about themselves and their organizations, they'll spend time exploring it and they'll share it with their friends.

With Twitter Grader, Dharmesh didn't just create a source of free advertising for his company, it's also implicitly targeted at people who want to improve their presence on the social network. Many of these people will be the small business owners that are in his target market. Even better, by offering the statistics as a gift to users, he created a small sense of reciprocal obligation that will make them more likely to purchase his services. The approach started with their original Website Grader service, but they found it so powerful, HubSpot now has a whole range of similar free tools for analyzing everything from your Facebook page to your blog.

The lesson for me is that giving people data and visualizations about things they truly care about can be a powerful tool for drawing them in to your service. Do some creative thinking about your customer's problems, and see if there's something you can offer them as a reward for their attention.

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You should kill unicorns and rainbows with science

One of the most enjoyable conversations I had at HubSpot was with Dan Zarrella, who describes himself as a social media scientist. I can already hear some physics PhDs grinding their teeth, but Dan has earned that title by applying a lot of much-needed rigor to the fluffy world of social media measurements. He's crusading against "unicorns and rainbows" metrics that have no connection to the goals you want to achieve. Many businesses have focused on building up easy-to-measure numbers like fan or follower counts, but to use Eric Ries' term, those are just vanity metrics. You can gain a million friends without it leading to a penny in revenue.

Dan's antidote is the relentless application of logic and analysis, working backwards from the business goals to evaluate everything you're doing as objectively as possible. A fantastic example of this is his study looking at how minor content details, like punctuation, make a retweet more or less likely. It's possible to argue with particular conclusions he draws, but he's transparently laid out the methods by which he arrived at them. Anybody with some technical knowledge and access to a decent chunk of Twitter data can try to reproduce and refine his results. This makes the report so much more useful than the opinions or impressions that dominate most discussions of social media, since we can actually have an evidence-based argument about it.

I came away from talking with Dan with a new appreciation of how powerful the scientific method can be in even the most unlikely situations. I'll be taking a fresh look at some of the painful problems my projects are hitting, and seeing if there's some way I can gather the right data to gain insights, even if they seem hopelessly qualitative at first glance.

User education is painful but powerful

HubSpot focuses on the sort of people who used to buy ads in the Yellow Pages to promote their businesses. These people know they now need to use the Internet to reach customers, but they aren't sure how. To succeed, HubSpot has to help those people build useful websites and channels. Templates and other automated tools help, but a lot still comes down to people creating the right content for their own businesses and responding appropriately when customers get in touch through Twitter, Facebook or email. The only way to achieve that is to teach people how to do it, and so a lot of the company's resources are put into education.

On a simple level, tools like HubSpot's graders offer simple suggestions for improving websites and other content. Users of the service are sent regular emails that remind them of steps and actions they need to take, such as updating their blogs. HubSpot hosts a popular video cast that covers all sorts of tips and horror stories from the last week in social media. All of these efforts really seem to help the company, judging from how enthusiastically users respond to all the material. On a deeper level, it also seems to help build a long-term relationship between the company and its customers, driving real loyalty.

One of the unwritten rules of the consumer technology world is that anything that requires educating users is a losing proposition. Anybody who has looked at their customer acquisition funnel knows how even minor usability problems can drive away vast swaths of people. What's different about HubSpot is that their customers are a lot more motivated than your average consumer on the web. They're using the service in the hope of actually making more money, so they're willing to invest some time. It left me wondering if I should spend more time creating training material for my own projects, rather than always prioritizing interface work to make them easier to use. The people who use them to create content are already investing their own time, so is that perhaps another situation where education would pay off?


Hubspot is a smart, practical company that's very focused on using the data they're gathering to understand what their customers really need. Maybe that's precisely because the team isn't in the Valley to be distracted by every shiny new idea? No matter what the cause, I'm grateful that they spent the time to show me what they'd learned, and I'm looking forward to applying these ideas to my own work.



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March 09 2011

Seldom a love story: IT and end users

No signToday, the IT department is often a victim of its success. With technology increasingly at the center of business initiatives, the demand for services is an insatiable. And while most IT professionals come to work each day to be productive and add value, more often than not, it's an uphill battle to keep internal customers happy. Working either harder or smarter hasn't necessarily produced the customer satisfaction dividend anticipated. Moreover, it has served to increase expectations of what can be provided and it has continued to raise the bar for IT.

Typically, IT will deliver the right thing at the right time (as long as there is leadership support and good requirements), but it can be painful getting there. Internal customers will be happy to get their solution, but they might not be happy in the manner it was done. It's a perception issue. IT is too often judged almost exclusively on how something was produced rather than what was delivered.

Should IT be chasing kudos or trying to get the job done right?

In the service business, success is often measured by having happy customers. In the marketplace, happy customers are repeat customers. Organizations with internal service departments are not usually subject to these types of competitive pressures. Sure, cost must be managed otherwise a service may be better performed outside the business. But even where cost is higher, organizations continue to enjoy the benefits and pay the premium of keeping many services internal. For example, they can exert maximum control and are not subject to continued contractual interpretations and disputes. With that said, if you're a captive cost-center, quality customer service has to be driven by something else such as culture, incentives, or vision. In other words: it's a choice.

If an IT team is delivering quality services and products but still not meeting, say, the speed of service expected, that might be an acceptable trade-off. In other businesses, quality may suffer in place of speed. In project management, there is a maxim known as the triple constraint. That is, changing one of the following: speed, cost, and scope usually results in an impact to the others. In service delivery, the triple constraint is often quality, speed, and customer satisfaction (underlying these is a fourth, the inadequately addressed component of risk.)

It's a worthy goal to be both a world-class customer service provider and a producer of high quality products and services. It's possible to manage the service triple constraint without too many trade-offs. But to be that organization requires an important operating principle: IT must rarely be the arbiter of priorities. That role must live squarely outside of IT.

Changing IT from an organization of "no" into an organization of "go"

I've seen it repeated throughout my 20-year IT career: internal customers come to the IT team with a need and it's IT who says it can't be done. Customers get frustrated and they have a poor view of the IT team. Usually they are saying "no" because of a capacity issue rather than a technical limitation. When IT says no to a customer, what they're really saying is that something else is more important. That's IT being an arbiter of priorities.

Yes, it goes back to IT governance, something I've discussed as being absolutely essential to business success.

But while IT governance can work as a process at the leadership level, it will fail when the IT team doesn't have the understanding and the language of the process to support it as it manifests downstream.

When confronted with a priority decision, an IT staffer needs to move arbitration back to the business.

The staffer typically wants to know what to do, not whether they should do it.

Therefore, you must transition your staff from saying "no" to asking questions about priority and capacity. It certainly can be the case that more than one request has priority. If so, it's now a question of investment. Spend more and you'll get more resources.

Bottom line: these decisions are made by the business, not by the IT staffer who's just trying to do the right thing.

Internal end-users and IT may never have a love affair, but if roles are better defined and understood, all parties will be less frustrated, have greater empathy for where they are coming from, and customer satisfaction will be firmly focused on the quality of the product or service being provided.

Photo: Encouraging No-No’s by jurvetson, on Flickr



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November 22 2010

Why "Delivering Happiness" is a must read

At Web 2.0 Summit last week, Tony Hsieh explained to the audience that when it came to phone support at Zappos, he had opted to use the phone as a branding tool rather than to focus on expense minimization or revenue maximization (upselling). Zappos is thriving. In his tenure as CEO of Zappos, Tony has made many decisions that might fly in the face of conventional advice, and in his book "Delivering Happiness," readers gain wisdom from his stories and processes.

For more than 40 years, we've escalated our obsession with productivity. From efficiency experts at Disney in the 1960s peering over the shoulders of animators to being accessible 24/7 by checking email and answering the phone in the bathroom today, we have worshipped at the altar of output, efficiency and accessibility. Our productivity- obsessed society manages time and not attention.

At many companies, software developers are rewarded for knocking out the list of features and cranking toward the release date with no emphasis on the quality of the feature being checked. Does it work? Check. Tests ran? Check. Is anyone asking if it's contributing to the excellence of the product or service? Is there another way, a path to quality results and profitability that is not productivity-obsessed?

One might venture a guess that Apple has found that path. Readers of "Delivering Happiness" realize that this alternate path is the secret sauce at Zappos.

Our productivity-obsessed society is in the more, faster club. Sometimes that's a good thing. Sometimes it's not. Which is why I started a discussion about post-productivity computing and an era characterized by post-productivity values.

Post-productivity does not mean unproductive. It does mean, let's take the best and leave the rest, as our burned-out selves, our burned-out workforce and our burned-out economy take steps to move into a thriving and prosperous 21st century. This era of engagement is post-productivity because the motivations and metrics mine, in the best ways, our human assets (positive emotions, positive relationships, meaning, engagement) as well as profitability. I use the term post-productivity primarily as a reminder that a productivity-obsessed approach to an era of engagement takes us right back into the murky swamp.

This is about a new mindset. Tony Hsieh figured it out and last year, 25,000 people applied for the 250 job openings at Zappos. Applicants are enthusiastic to be part of an era of engagement, post-productivity company -- selling shoes online, being part of the Zappos team.

Like many of you, I've worked in companies that pit employees against each other by rating on a curve. Productivity, which could be contagious, instead, becomes a zero sum game. The brilliant and insightful Stanford professor Carol Dweck, author of "Mindset," would view this as a management process with a fixed mindset orientation. Hsieh manages Zappos for what Dweck calls a growth mindset, a mindset that welcomes challenges, embraces exuberant learning, and experiences failure as part of positive forward motion.

Once you start reading "Delivering Happines" you'll feel an irresistible pull to email Zappos for a copy of their "Culture Book". This crowd-sourced, edited collection of stories bathes the reader in stories of a corporate culture characterized by trust, productivity, joy, and profitability. "Delivering Happiness" is an inspired and inspiring must read for our journey into an era of engagement.



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May 12 2010

Craig Newmark on better government through enlightened customer service

Would you "like" a government agency on Facebook? Would you "like" a service delivered by a .gov website? How would you feel if a government official "liked" you back? How would you like to be identified online?

Craig NewmarkThere are no easy answers to these questions, as anyone who attended the FTC privacy workshops or recent "privacy camps" in the District of Columbia or San Francisco knows. Craig Newmark, the founder of craigslist.org, attended the privacy camp in San Francisco and shared a few thoughts about issues of trust, identity, social networking and government.

Online privacy is now even more top-of-mind for tens of millions of users, as Facebook's social plug-ins roll out across the Internet, along with its instant personalization pilot. Thirty-three government agencies are on Facebook, with more than 400 pages between them. Those government agencies may not have added "like" buttons yet -- but they're interacting with citizens on Facebook, Citizen Tube, Google Moderator, Twitter and beyond.

Electronic privacy is much more than social media privacy, as White House e-privacy priorities on HIT, smart grid and education show, but the topic has been red hot since Facebook's f8 developer conference. When Jenna Wortham asked the readers of the New York Times to ask Facebook privacy questions, for instance, nearly 300 of them responded.

When Craig Newmark visited Privacy Camp SF, he used characteristic humility in observing that he saw a whole bunch of people "much smarter than him interested in real privacy issues and how to do something about them." Newmark, who founded craigslist more than 15 years ago, has seen how online culture has evolved as the Internet and web has experienced exponential growth. "That culture respects privacy, though the concept is being redefined," he said. "It's a moving target. It's important to know what information exists about you, know how it is being used, and be able to control that information."

Gov 2.0 Expo 2010Newmark was thoughtful about privacy controls for social media platforms, deferring specific technical questions to the Electronic Frontier Foundation or the Sunlight Foundation, where he sits on the board of directors. He also saw potential in Facebook's new features. "For example, Facebook's open social graph stuff could be a good tool for democracy," he said. "It allows someone to work with a wide network for good effects, mutual benefit and for the common good. In addition, if someone uses a Facebook profile -- or something similar -- to participate in national agenda setting, it provides transparency into their identity."

Many actions online require identities, particularly for engaging with government entities or making transactions. Should citizens use identities from a trust framework like the Open Identity Exchange (OIX), social network profiles, or virtual versions of government-issued IDs, like social security cards or driver's licenses? "I prefer to have a choice, like public-private partnerships," said Newmark. "People are still finding out what works."

Is Facebook a trustworthy entity to be an online identity provider? "I think Facebook is trustworthy," said Newmark. "But absolute power corrupts absolutely in practice. We need a number of trusted options for identity providers."

On this count, Newmark expressed a similar position to the one Vint Cerf, Google vice president and "the father of the Internet," articulated during his keynote talk at the Future Web 2010 Conference in April. "Not for a moment do I believe we have a single unique identity," said Cerf. "I want multiple strongly authorized identities."

The paired issues of e-privacy and trust and reputation systems have often appeared in Newmark's writing and interviews this year. Newmark recently spoke with GigaOm senior writer Mathew Ingram about the web's next big problem:

Public service, meet customer service

In the interview, the most famous customer service representative in the world also offered simple tips to government officials -- or anyone faced with helping customers, consumers or clients online, for that matter. "First, listen," he said. "Figure out if their concern is valid. If it's valid, you solve it. There will be people you can never make happy. You help them in good faith but you need to know when to give up."

What if government agencies, employees and elected officials can't "give up" on providing online services? "That shouldn't be an excuse for not delivering good customer service," said Newmark. "A related problem is trying to help someone who is having trouble articulating a problem. You need to proceed in good faith and listen."

How would he like to be contacted by someone in government? Again, Newmark kept it simple: "Tell me who they are, where they work and what they want to know."

Newmark grounded the value of craigslist for towns and cities in creating a platform for communities to interact online. "It requires people running cities to stay engaged with communities, listen, then act. That pattern then repeats."

Newmark also pointed out challenges specific to government in engaging through online forums. "There are a number of problems where government is impeded in attempts to serve the public," he said. "Laws and regulations, like the Paperwork Reduction Act, get in the way of providing good customer service. People in Washington are working on that now."

Newmark was spot on. Cass Sunstein, administrator of the Office of Information and Regulatory Affairs (OIRA), issued a memo in April on "Social Media, Web-Based Interactive Technologies, and the Paperwork Reduction Act" that made it easier for federal employees to use public social software platforms. A PRA primer was also released to "give a clear, simple, transparent understanding of the law's central requirements."

The bigger problem, said Newmark, is that "until the last year or so, people were told government is the problem, or that government doesn't matter. People in government were told that providing good customer service could be career-limiting."

Newmark described some areas where that's been changing in the federal government. "Where I see things beginning to work better are in Veterans Affairs, under Peter Levin, the new CTO," he said. "Or Todd Park, CTO of Health and Human Services, or with federal CTO Aneesh Chopra and federal CIO Vivek Kundra."

Newmark spoke to CQ Politics about "how the Internet will make you a better citizen." Video of the interview is embedded below:

What are the risks and rewards of open government in practice?

"It's a complex situation," Newmark said. "The danger is that a very, very small organized minority can try to game the system to make it seem like their position is supported by a majority. There are front groups that specialize in that kind of thing. They represent special interests and add spin. We need better ways to counter that. One method is to rely on fully populated [social networking] profiles, because those are expensive to create. That's only the beginning of the solution, since it's still quite possible to build profiles. It's more difficult to sign up for email than to build a profile that has social capital."

What recommendations would Newmark make to agencies using internal collaboration software? "I have used internal discussion boards and ideation software," said Newmark. "People can oppose new ways to do things, other people can revise suggestions and everyone votes them up and down. Another approach is to use internal wikis to share knowledge about how to do things."

Newmark is bullish on the potential for social media to improve government. "I've seen it already happening, for example with HHS and Veterans. I would like to see that use spread everywhere in government, including state and local levels," he said.

For more on Newmark's thoughts on the future of public service, read his interview with Micah Sifry or watch the following video of him speaking with Alan W. Silberberg at the Gov 2.0 LA unconference earlier this year:

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