Columbia Business School's Brite '13 Conference Archives

CMO Insights: The Content Imperative

Posted on March 19, 2013 by Drew Neisser

Steve Rubel is Chief Content Strategist for Edelman, the world’s largest public relations firm, so it shouldn’t come as a surprise that he is evangelizing about the importance of content marketing. Given that I happen to agree with Steve and having seen him speak at the Brite ’13 Conference, I was delighted to be able to dig into the topic a bit deeper with him after the fact. As you will see, there’s a lot more to content marketing than publishing a few articles. In fact, it requires a comprehensive approach including a clear strategy, a diverse blend of media (paid, earned and owned) and writers that know how to start conversations. But don’t take my word for it, read on…

Neisser: So, what exactly is The Content Imperative?
Rubel: It’s the belief that creating content is no longer optional. Rather, it’s imperative given the significant economic changes that are taking place in both media and, resultantly, marketing. With more ads bought/sold through trading desks, advertising is now far more efficient and effective. This is great for the marketers, but it’s a nightmare for the publishers since it erodes their margins.

Faced with a lack of viable options for generating new/replacement revenues – e.g. subscriptions, significant increases in video views (which have a higher CPM) – media companies are increasingly becoming open to taking sponsored content. Sponsored content is poised to become a significant, possibly even a major new advertising format. And it’s for this reason why it’s now an imperative.

Neisser: When it comes to content marketing, what does success look like in terms of business metrics that a CEO or CFO would appreciate?
Rubel: The metrics of success really depend on the approach. Are you building an asset and trying to attract an audience to you or are you trying to engage the public on other lands? In the case of the former, it’s traffic that leads to sales. In the case of the latter, it’s impressions that create brand awareness and/or potentially lead to traffic and sales.

Neisser: Presumably content marketing provides some kind of competitive advantage. Can you provide a real world example or two of marketers that have gained competitive advantage via their content marketing efforts?
Rubel: Red Bull is just as known for the content it creates as it is for it’s brand attributes. The same is true for GE (an Edelman client). Both have a content vs a message mindset. One is a consumer brand effort, the other is corporate reputation.

Neisser: So, does this mean every marketer needs to become a publisher? And if every marketer in every category is pushing out their own content, at what point does the consumer say, enough already AND/OR at what point does content publishing no longer provide competitive advantage?
Rubel: Not necessarily. There could be a first mover advantage here in some categories. And, yes, it is possible that consumers won’t be receptive. That said, throughout history quality content has prevailed over junk no matter where it comes from. What’s different now is that the playing field has leveled. Brands have a viable way to get their message out and a cadre of media owners ready to help them do so.

Neisser: Creating great content is an art form that not every company can master. And of course, content is what media companies do really well. So, how can chocolate (marketing) & peanut butter (media) get together nowadays?
Rubel: Due to the economic underpinnings mentioned above, media companies are increasingly recognizing that content marketing is a viable revenue stream when done right. Many media owners have set up distinct content studios that exclusively serve marketers. They help customers understand their audiences, create content and build deeper relationships. However, they are limited to doing so within their walls.This is why we believe there will be opportunities for agencies like Edelman to integrate different partnerships in context of a broader program.

Neisser: Given an over-abundance of content (aka the WWW) and a dearth of free time (so we all say), should marketers be more focused on quality than quantity, striving to become a recognized curator rather than a prolific purveyor?
Rubel: Absolutely. Slow is the new fast. Quality is the new quantity. (Although these are old ideas) However, scale is still critical. As is consistency.

Neisser: Content publishing has the potential to be a one way street almost like traditional advertising. Where does social / conversation fit into the content marketing picture?
Rubel: The media owners seem open to experimenting on their social platforms. The faster we together make this about content as a means to building relationships, the better.

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Thinking Big About Big Data

Posted on March 7, 2013 by Drew Neisser

The term “Big Data” has quickly become the buzzword du jour garnering its own Wikipedia page and showing up in 21 million search results. But frankly, every time I hear the phrase, it is lumped into a string of buzzwords that makes my head spin, making me wonder, could any self-respecting forward-thinking technology company present their transparent vision without paying homage to the game-changing paradigm-shifting potential of Big Data?

Fortunately for me, I got a chance to hear professor and author David Rogers speak about the genuine potential of “Big Data” (without a single cliche) at the recent Columbia Business School Brite Conference. Rogers explained how IBM’s Watson (artificial intelligence computer system) has been fed exabytes of medical information that it can sift through in seconds to help doctor’s more accurately diagnose and treat patients. Another example Roger’s mentioned is Waze, a mobile map app with 30 million users, that gets real world traffic information from users and then processes that information to re-route other users in real time. Wanting to know more, I caught up with Rogers after the event yielding this informative interview:

Neisser: Leaders have always been challenged to get the right information to make good decisions. How do modern leaders take advantage of the excess of data available to find the truth they need?
Rogers: There is actually no excess of data. That’s a myth attached to the term “big data.” Digital data has been growing exponentially since the birth of the computer era. Before that, recorded data grew exponentially since the invention of human writing. I don’t think Napoleon complained that there was “too much data” as he pored over reports of historic battles to conceive his next campaign strategy. What he needed was insight, and the right questions to ask of the data available.

The amazing challenges and opportunities of the Big Data era really don’t stem from the sheer quantity of data. They come from the new kinds of data that we are getting, and our new tools for analyzing them – especially for analyzing unstructured data like video, images, and social media conversations.

My first advice for business leaders is: don’t meet with anyone who wants to sell you some great juicy set of data they’ve got. Don’t be that sucker. Only work with people who want to help you solve a genuine problem, or capitalize on an exciting opportunity, using data.

Neisser: I think it was Einstein who said, “information is not knowledge.” Can you provide a real world example (or two) of how this data/info is being harnessed by marketers right now?
Rogers: Sure, data is now being used to answer many of the most critical questions that marketers face. Who should I market to? When and where should I spend my budget? Which are my most valuable customers? How should I personalize my offer? What impact did I get from my marketing?

Many of these answers are coming from the domain of predictive analytics. When a customer makes their very first purchase on an ecommerce site, it is now often possible to predict, with decent accuracy, how many more purchases she will make this year, her total spend, and if she fits in the top 5% of your customer base in terms of lifetime profit to the firm. You might be wrong on a given customer, but on average over the entire behavioral segment, you’re quite accurate. That’s extremely powerful.

Neisser: Are these Big Data technologies going to be used just by big companies? Will they pose a competitive disadvantage for small and mid-sized businesses?
Rogers: Not necessarily. One of the key drivers of the big data revolution is cloud computing and the SaaS (software as a service) model. That means that hospitals around the world will be able to start accessing IBM’s Watson, the most powerful natural language processing algorithm in the world, to assist in their cancer diagnostics. Watson is an incredible supercomputer, but your local oncologist will just access it over the web via an app of their tablet.

In the marketing space, the startup Optimizely is providing incredibly cheap entry points for small business to start using its web-based tools to test and gather data on the effectiveness of direct response marketing. You don’t have to be the big boys to start reaping the benefits of the Big Data era.

Neisser: Bringing it back to the C-suite, what do you see as the challenges for leaders adapting their skills, and their teams, to the “Big Data” era?
Rogers: Firstly, formulating the right questions to ask of data will be a key leadership skill for the future. That also means knowing when and how to balance intuition and judgement versus data-driven decision-making.

CMO’s in particular will need to hire some new talent – data scientists who can apply these emerging data tools to unlock value for the enterprise. There will be a lot more math PhDs in the marketing divisions of firms, and not just where you used to find them, in the market research companies. But CMOs also need to train the rest of their team – the creative copyrighters, the ethnographic insight hipsters – to be facile with the world of big data, so they know what questions they should be posing to the data geeks in the next room. It’s really going to be a cultural change as much as skill training.

Neisser: What about the CEO and strategy? You said at the BRITE ’13 conference that leaders need to see data as a strategic asset. Can you explain?
Rogers: Yes, truly successful leaders will see data not just as a tool to assist decision-making, but as a core strategic asset.

Think about e-tailers like Amazon or media companies like Netflix. They have spent the last few years building amazing data sets about the behaviors and preferences of consumers. These are incredibly valuable assets, just as much as their hardware, their software, and their licensing and partnership deals. Amazon is using its data assets to not only improve its core retail business, but to offer incredible targeting to marketers. Netflix has used its immense data on what stories, actors, and creative teams its viewers have preferred, to plan and commission entire new TV series, like “House of Cards,” without having to go through the normal process of paying for a bunch of pilot shows and options with no clear idea which one will resonate in the market place. That’s a huge market advantage and risk reducer. The best leaders in every industry will be those with a strategy for building powerful datasets around their markets and customers – and then leveraging these assets to drive innovation and value creation for customers.

David Rogers is founder of Columbia Business School’s BRITE conference on brands, innovation, and technology, and author of “The Network Is Your Customer: 5 Strategies to Thrive in a Digital Age.” His next book will show why businesses that use big data effectively will survive in an era of disruptive change. You can find him at www.davidrogers.biz.

How Intuit Drives Innovation (and you can too)

Posted on February 27, 2013 by Drew Neisser

Small companies are often founded by innovative individuals who by design or necessity lead their business into new and unchartered territory. As a company matures that innovative spirit is often squashed under the weight of a fearsome bureaucracy. One company that seems to consistently break this pattern is Intuit, extending its product line well beyond Quickbooks and TurboTax with a steady series of innovative offerings including SnapTax, a mobile tax filing app.

Kaaren Hanson, VP of Design Innovation at Intuit, believes that the trick is “creating a culture of rapid experimentation” and is speaking about that very topic at next week’s Columbia Business School’s Brite ’13 Conference. As you will see in my interview below, Kaaren is refreshingly honest, reminding those that want to innovate (at any size business), to “fall in love with the problem, not the solution,” that today “leadership is about experimentation” and “innovation is part of everyone’s job.” But read on. There’s a lot more to this innovation thing than grabbing a white board and gathering the usual suspects!

Drew: Are we currently in the “innovation age” or is innovation simply an imperative for companies looking to thrive (versus survive) in a rapidly changing global economy?
Kaaren: We have a long way to go. I would say we are entering the “innovation age.” Changes in how we work and think are beginning to take place, but most of the results and impact are yet to come.

Drew: Can you share a specific recent innovation at Intuit and speak to how it came into being?
Kaaren: How about preparing and filing your taxes in less than 10 minutes on your smart phone? That’s a recent innovation from Intuit we call SnapTax. After announcing mobile as a key priority for the company, Intuit CEO Brad Smith was asked by an engineer in an employee chat: “What the hell does mobile have to do with taxes?” He told them he didn’t know, but he knew they’d figure it out. A few months later a small team had an idea. Intuit gave this small team the freedom and the resources they needed to dream and develop – and they came up with a mobile app to prepare simple tax returns on an iPhone, easily and accurately. That team’s work became SnapTax, which makes it easy to file a simple tax return on a smartphone in the amount of time it takes to find a parking space at H&R Block.

Drew: Does creating a culture of innovation also require a certain tolerance for failure? Are there ways to mitigate the risks?
Kaaren: Who likes failure? A string of failures and you’re out of business. You have to learn from failure and use it like road signs that direct you to success. Having a culture where people savor surprises is important. That surprise could be a big upside or a big downside. Intuit’s co-founder Scott Cook says it well: “If there’s something that’s really a big surprise, upside or downside, that’s generally the real world speaking to you, saying there’s something you don’t yet understand.” It’s less about mitigating risks and more about carving out space for people to experiment and learn from failure. One example from Intuit is our Lean StartINs. These are one or two-day events where small groups of employees come to test their ideas for new products or services.

Drew: What are the other big cultural changes required for companies to become more innovative?
Kaaren: Leadership models need to change, especially when it comes to how decisions get made. In the innovation age leadership is much more about Thomas Edison than Dwight Eisenhower. Leadership is about experimentation. It’s no longer about the boss making the decision or judgment. Instead, we make the decision based on testing the hypothesis and experimentation. This is moving decision-making from the boss’s opinion to enabling the answer to prove itself with customers voting with their feet.

Drew: Innovation often seems to align with the corporate growth cycle—younger companies tend to innovate more than bigger ones either out of necessity or because the culture is younger and less risk averse. How does the proverbial old dog learn new tricks?
Kaaren: It starts with having a strategy that will fuel growth through big economic and technological changes. Then give employees the freedom to experiment, and ultimately bring to life those groundbreaking innovations that will inspire more innovation.

Drew: Can the big guys do this without creating “skunkworks” or other splinter operations that are not just empowered to innovate but are really required to do so?
Kaaren: At Intuit innovation is part of everyone’s job. If the big guys want to see new ideas come to life at their company, they should democratize innovation. We offer unstructured time to all employees at Intuit, to give great people with great ideas the time and freedom to pursue them. Having an innovation awards program is also a good way to celebrate successes and reinforce the importance of innovation. When it comes to our innovation awards program, we provide the three things that innovators wanted most: recognition allowing access to leaders and other innovators, time to innovate on a project of their choice and financial reward.

Drew: Henry Ford is famous for saying, “if you asked people what they wanted, they would have said faster horses” and Steve Jobs was also a skeptic of the consumer’s ability to recognize the need for what would become a totally new category. How important is consumer input/feedback in your innovation process?
Kaaren: Just listening to what customers say is a waste of time. Customer Driven Innovation is one of our core capabilities that differentiates us and allows us to deliver solutions that truly change people’s lives. One of our signature methods is something we can Follow Me Homes, observing customers “in the wild” – it may be their homes, coffee shops, or the train. We notice what and how they are going about their daily lives and then probe deeply to understand the motivations and emotions that drive their behaviors. These nuggets provide rich material for our innovations.

Drew: Presumably Intuit has had some failures along the innovation road. Is it true that you can learn as much from failures as you do successes and if so, what have you learned?
Kaaren: You can certainly learn from failure. It goes back to my earlier comment about savoring surprises. We recently learned this important lesson: fall in love with the problem, not the solution.

Many of Intuit’s customers are small businesses. We had a team that had been exploring opportunities in adjacencies to our payroll business, and found that health coverage is the most important employee benefit. Yet most small businesses don’t offer this benefit because it’s too expensive and too much work to administrate. The Intuit team took that customer problem and found a way to create a new, low-cost health insurance plan solution. The insurance plan got positive feedback from customers and good overall results in market testing. However, when the team began offering the plan, they only sold four plans in five months. The team then went back to drawing board. They again examined the learnings from customers and added some new members to the team with different perspectives. This led to the team taking insurance out of the solution. Instead, they created a health debit card product to which employers would contribute an amount that they set for their employees to use for healthcare expenses. So the employer sets the cost, and employees get full choice with pre-tax dollars.

A key learning from the failed low-cost insurance plan was, fall in love with the problem, not the solution. In this case the problem still existed. The team needed to have a mindset that as long as they understood the problem, they could be flexible, iterate further and in the end make a product more likely to succeed. The team continues to iterate, and the Intuit Health Debit Card is performing well in a limited market release.