The Future of Mobile

http://www.businessinsider.com/the-future-of-mobile-slide-deck-2013-3#-108

When Working at Home Is Productive, and When It's Not

When Yahoo CEO Marissa Mayer announced a complete ban on working at home in late February, she sparked an uproar in the media, not to mention in the halls of Yahoo itself. The ban goes into effect in June and impacts everyone, including employees who had previous agreements with the company allowing flexible work arrangements. One irked employee sent an anonymous e-mail to the technology blog AllThingsD saying the new policy is "outrageous and a morale killer."
Wharton faculty members who specialize in issues pertaining to employee productivity and work/life balance were similarly surprised by Mayer's all-encompassing policy change. "Our experience in this field is that one-size-fits-all policies just don't work," notes Stewart Friedman, Wharton practice professor of management and director of the school's Work/Life Integration Project. "You want to have as many tools as possible available to you as an executive to be able to tailor the work to the demands of the task. The fewer tools you have available, the harder it is to solve the problem."
So what is Mayer trying to accomplish by requiring all employees to show up at the office each day? A spokeswoman for Yahoo declined in an e-mail to comment for this article, saying only, "this isn't about an industry view on working from home -- this is about what's right for Yahoo right now."
According to the original memo sent by the company's human resources department to employees (and later leaked to the media), the idea of the new policy is to improve communication and collaboration. "Some of the best decisions and insights come from hallway and cafeteria discussions, meeting new people, and impromptu team meetings. Speed and quality are often sacrificed when we work from home," the memo said.
Yahoo's annual revenues have fallen more than 20% in the last two years to $5 billion, and in 2012 the company's operating profit plummeted 30% to $566.4 million. Mayer, a veteran of Google, has been viewed as a savior by Yahoo investors, who have pushed the company's stock up 45% to $22.70 a share since she took over last July.
Friedman says there's little disagreement in the work/life field about the value of face-to-face communication -- especially at struggling companies. "When a company is bleeding profusely, it requires a great deal of interpersonal communication to develop effective responses to critical challenges," Friedman states. "The need to be able to communicate in rich media, i.e. face-to-face, is much more important there than it would be, say, for a call center worker in China, where you can measure performance in very concrete, demonstrable ways."
Mayer's work-at-home decision is consistent with the management style she has perfected throughout her career, according to University of Virginia Darden School of Business professor Melissa Thomas-Hunt, who published a case study about Mayer's rise through the ranks at Google. "What we concluded was that she was very hands-on, and she liked to mentor those around her," Thomas-Hunt notes. "She would bake birthday cakes and would celebrate her colleagues. Relationships were really important. So I can see how she would feel that being able to see and interact with individuals would be important."
That said, Thomas-Hunt points out that proximity doesn't necessarily lead to better collaboration because the rise of e-mail and other technology tools has lessened the need for face-to-face encounters. "The reality is that we're often in the same office space, and yet we're sending e-mails to one another," Thomas-Hunt says. "Any time you have individuals trying to work together, there is potential for a communication breakdown."
All in all, research on the value of everyone being in the office has produced mixed results, suggesting that the answer to the conundrum of how to improve productivity may need to be decided in a nuanced way that takes into account localized challenges and the needs of individuals. "The important considerations here are business considerations. You have to look at the context in which various work arrangements are effective," Friedman notes.
Water Cooler Communications
As Mayer's memo suggests, being in the office does enhance the so-called water-cooler effect -- those chance meetings and unexpected conversations that can generate new ideas. "Serendipity happens at the water cooler," says Wharton operations and information management professor Lynn Wu, who studies the impact of both personal interactions and online social networks on employee productivity.
In one of Wu's studies, a group of workers at a technology company wore electronic badges that kept track of their face-to-face interactions for a month. Wu and the co-authors of the paper (which is under review by an academic journal) found that such meetings were associated with higher overall productivity. They also discovered that when employees interacted with key people on their teams, it sped up the work itself. "When you're trying to transfer really complex information, face-to-face communication is a must," Wu notes.
The benefits of in-person communication aside, it may not be necessary for all employees to be physically together all the time. Wu says her research suggests that having everyone in the same physical space is most valuable when there are new projects being launched or a defined set of problems a company is trying to solve. "It's important when you are in the information-seeking stage or the exploration stage," Wu states. "But there comes a point when you know what you need to do, and you just have to get it done. At that point, it's OK to stay at home."
Wharton management professor Nancy Rothbard says managers who want to maintain work-at-home options can foster interactions among remote workers, not only by structuring their time, but also by taking advantage of technology like Skype and other videoconferencing programs. "Maybe you say that from 10 a.m. to noon or from 1 p.m. to 3 p.m., everyone is available for Skype or for conference calls," Rothbard suggests. "That allows people to ask questions of one another and get things done interactively." She adds that it is important for companies to train managers on this technique and other best practices for getting the most out of employees who work at home.
Some critics of flexible work arrangements worry that working at home can present too many distractions, like crying babies, or the temptation to log onto Facebook when you should be Skyping a co-worker. But when you are able to set boundaries and handle those occasional distractions, you save a lot of time. You don't have the commuting costs of going back and forth. And if things are going well, it can be a great experience that you can use positively in your work life."
Rothbard adds that employees who work at home need to do a little extra legwork to manage how their colleagues perceive their engagement and productivity. Indeed, a Stanford study shows that people who work remotely are 50% less likely than their peers to get a promotion. "The employee has to manage his or her impression actively," Rothbard says. "You have to make sure that people feel that when you are available, you are fully present. If you sound distracted, or you have kids crying in the background, or you don't seem focused on a conference call, that's going to be a difficult impression to overcome."
Rothbard also suggests that work-at-home employees be as visible as possible. "If somebody posts a question on the company's Intranet, you want to be one of the people who are responding. You need to get people to know your value, even if you're not physically present."
Deploying Technology for Mutual Gain
While it may seem that the Internet and other electronic venues are less personal than face-to-face interactions, some research has shown that technology can actually enhance teamwork. One of Rothbard's most recent studies, for example, found that constant face-to-face communication among groups of software developers wasn't essential for the members of those groups to remain engaged and focused. "There were instances of group engagement where people were on Yahoo Messenger, interestingly enough, or another interactive technology that allowed for back and forth and the focusing on a single task."
How best to deploy technology is a challenge in every workplace, regardless of whether employees are at the corporate headquarters, in remote offices or at home. Says Friedman: "What's interesting about the [Yahoo] case is that what we might be seeing here is a kind of swinging back of the pendulum from 'all-virtual-all-the-time is good' to a more nuanced consideration of: 'When does virtual work and when doesn't it?'"
Friedman once asked his students to compile a list of all the different ways people could interact with each other -- online or off. They came up with 17 communications tools, ranging from old-fashioned phone and snail mail to today's music-sharing apps, podcasts and blogs. "There is an array of options that people face, and the problem is we're not conscious of the choices we're making about which media to use." Friedman says he often asks the executives he works with to identify the most important people in their lives, figure out what percentage of time they use each form of media to communicate with those people, and then answer this simple question: "Is that working for you?"
Friedman hopes the Yahoo uproar will eventually lead to an intelligent, deliberate discussion among all executives about when flexible work arrangements are appropriate and how companies can best manage the collaboration process so all their workers are both happy and productive. "The more supportive policies that are available the better," Friedman notes. "But ultimately it comes down to applying those in a way that makes sense at the local level. What you want to aspire to is greater freedom for people to choose how to get things done -- with clarity as to what the results need to be."http://knowledge.wharton.upenn.edu/article.cfm?articleid=3208

How 'The Road Not Taken' May Be Undermining Your Choices

Who is more content with their spouse? The couple who met through the traditional dating scene -- getting serious with one partner at a time and rejecting anyone who did not meet their criteria before settling on each other? Or the couple with a semi-arranged marriage where they were presented with a handful of pre-selected men or women to pick from?
This question intrigued Wharton marketing professor Cassie Mogilner and colleagues Baba Shiv, a Stanford marketing professor who had a semi-arranged marriage, and Sheena Iyengar, a management professor at Columbia who met her spouse through the traditional dating scene but came from an arranged marriage background. "We couldn't use the marriage choice context for [a research study] because it would be very difficult," Iyengar says. "So we decided to look at the consumer choice context." For example, would the more satisfied consumers be people who went from store to store, trying out a number of different products over an extended period of time, or the 'one-stop shoppers' who made a decision with all of the options in front of them?
In a series of experiments, the researchers studied how the way options were presented to consumers affected the feelings they ultimately had about a particular choice. Their findings are outlined in the paper,"Eternal Quest for the Best: Sequential (vs. Simultaneous) Option Presentation Undermines Choice Commitment," which appeared in the Journal of Consumer Research.
Mogilner adds that it was particularly important to highlight the sequential option (or the "dating one by one") side of the debate because very little research had been done on this type of choosing: Most consumer choice research focuses on simultaneously presented choice sets. "While this research was spurred by finding a life partner, we know there are lots of other important decisions that are presented sequentially, such as shopping for a house, deciding whom to hire or choosing what job to take," Mogilner notes.
After looking at individual selections in experiments that asked some participants to choose from a range of options presented all at once and others to pick from selections offered one at a time, the researchers concluded that the couples who came together through semi-arranged marriages should -- in theory -- be more content. "Whether choosing a piece of gourmet chocolate, a nail polish color or a bottle of Italian red wine, individuals presented with their options one at a time end up less satisfied with, and ultimately less committed to, their chosen option than individuals presented with their options all at once," the researchers write.
But why do people feel more satisfied with, and committed to, a decision when they see all of the potential routes at one time? According to Mogilner and her colleagues, the key driver is hope -- in particular, the negative implications of hoping too much. "To my knowledge, this is one of the first" studies to look at the negative side of hope, Iyengar says. "We usually think of hope as a good thing."
Of Chocolate and Wine, Hope and Regret
In the first experiment, 87 individuals were presented with five different gourmet chocolate options, either sequentially or simultaneously, and asked to pick their favorite. Those who tasted the chocolate sequentially were allowed to try each variety before being asked to choose one. The researchers measured the role of hope in the decision by giving half of each group a 10-digit number to remember during the tasting, with the theory that saddling them with a "high cognitive load" would limit their capacity to conjure up the idea of a sixth, even better chocolate that might make them regret their initial choice. The other participants were asked to memorize a two-digit number -- or a "low cognitive load" -- with the idea that they would have plenty of brain power left to consider the possibility that a tastier candy was out there somewhere.
Afterward, participants were asked to rate how satisfied they were with their choice of chocolate, and to answer questions designed to measure the levels of hope, fear and regret that resulted from the experience. Finally, in order to gauge participants' level of commitment to their choice, the entire group was given the option to change their original selection, either to a type of candy they had sampled during the tasting or to an option they hadn't tried yet.
According to the paper, participants who sampled the chocolates one by one and were given the two-digit number to remember exhibited greater hope that there was a better choice out there than people who were given all of their options simultaneously, no matter what type of number the latter group was given to memorize. Participants who tasted the candy sequentially but were asked to remember the 10-digit number also reported lower levels of hope, lending credence to the researchers' theory that having to memorize the number would hinder their ability to dream up a different option.
On the other hand, participants' level of commitment to their choice was divided along the lines of cognitive load. Of those who had to remember the two-digit number, half of the sequential choosers and 40% of the simultaneous choosers opted to switch to the untested option. Among participants given the 10-digit number, just 13% of sequential choosers and 17% of simultaneous choosers decided to switch. "These results suggest that when sequential choosers have the cognitive resources available to imagine a better option, they will," the researchers write. "They will, in turn, be more likely to switch to that unknown option, hoping it will be better."
The second experiment built on the first by directly manipulating whether participants felt hope for a better option while making their choice. Unlike the first study, people who were presented with the chocolates one by one could only pick a particular type when it was in front of them -- there was no going back to select something they had already tasted. In addition to the lab study, the researchers also conducted a pilot field experiment studying nail salon patrons choosing colors for a manicure.
When the nail salon customers were offered the chance to take home either a free bottle of the color they had selected for their manicure or the chance to pick a different polish, 83% of simultaneous choosers stuck with their chosen option, while only 43% of the strict sequential choosers did so. In the modified chocolate study, half of the 198 participants were told to reflect on a time when they felt hope before they tasted the chocolates, while the other group was asked to ponder a neutral topic. Those two groups were divided in half, with some tasting all the chocolates simultaneously and others doing so one by one.
According to the researchers, provoking feelings of hope in participants dominated the way they felt about choosing a type of chocolate. Notably, the simultaneous and sequential choosers who were made to feel hope reported equally low levels of satisfaction with their original choice, and nearly half switched to the unknown chocolate option, with even more doing so in the simultaneous option group. In the neutral group, however, one-third of sequential choosers switched to the untested chocolate, compared to only 4% of simultaneous choosers. "These results suggest that the low commitment exhibited among sequential choosers is driven by increased feeling of hope," the researchers write.
The final experiment was a field study conducted as a wine tasting. The researchers measured the extent to which the 129 participants felt hope when making a choice, and further "honed in on the role of hope" by also measuring regret and including both types of sequential conditions -- i.e., people who were presented with the options one at a time and allowed to taste each wine before picking their favorite or those who could only choose a particular wine when it was in front of them -- along with a simultaneous group, in which all of the glasses were presented at the same time. The experiment followed the same pattern as the first two: sampling, selecting a favorite, filling out a survey, and then deciding whether to stick with the chosen option, switch to one of the previously sampled wines or switch to an unknown option.
All sequential choosers were much less committed to their chosen option than those who were presented with all of the wines simultaneously, the researchers note. But only those sequential choosers restricted to picking a type of wine when it was in front of them were more likely to feel regret about their choice.
"What was interesting was that when we held everything constant -- when the sequential and simultaneous choosers had all of the same information available to them -- when they made their choice, something as simple as how it was presented to them influenced levels of satisfaction," Mogilner says.
The Price of Satisfaction
Looking at the results of all the experiments, the researchers found that there was no pattern to the product selections of any one group, leading them to conclude that it wasn't that some participants ended up objectively worse off than the others -- sequential choosers experienced those outcomes as being less desirable because their mind stayed focused on "the road not taken," or the option that remained undiscovered.
Mogilner and Iyengar say it was intriguing to test people's reaction to such frivolous items as wine and chocolate, where participants likely didn't come in with any strong preconceived perceptions of a particular option. But they add that the results do have broader applications. Notably, the research supports presenting options simultaneously, as retailers would prefer that consumers don't regret a choice and ultimately decide to return an item, or communicate to other consumers their lack of satisfaction with a purchase. "While all the instances in the paper are fairly trivial, the implications of simultaneous versus sequential choice can run across all types of decisions," Iyengar notes.
But can firms change their policies and practices to turn decisions involving sequentially presented options into choices where all of the possibilities are shown simultaneously? According to Mogilner, such an adjustment is easiest for online retailers that have full control over how their product assortments are presented. "Our findings suggest that options should be presented together on the same web page, rather than on separate pages," she states.
Mogilner adds that the paper also sheds light on just how harmful hoping can be. When one is in a sequential choosing situation, he or she should have confidence in making a decision and stop wondering "what if" -- whether it's a new home, job or even a spouse.
"This shows the detrimental effect of continuing to wonder what else is out there, and how it undermines satisfactions with the choices you make." Mogilner says. "Instead of comparing your chosen option with an imagined perfect option, compare you chosen option with the other options you've seen."http://knowledge.wharton.upenn.edu/article.cfm?articleid=3212

What’s the Deal with Groupon?

The firing of Groupon CEO Andrew Mason earlier this month set off a new round of speculation about the daily-deal company’s prospects. The announcement came a day after the firm’s most recent dismal quarterly earnings report. Although sales had risen 30% in the fourth quarter from a year ago, the company reported a loss of 12 cents a share and indicated that its earnings for the first quarter would be much lower than analysts’ expectations. According to an article in Bloomberg, Groupon’s losses in the last three years have totaled $723.8 million. The firm’s board has begun searching for external candidates to replace Mason, the article noted.
What does the company need to do to turn its fortunes around? K@W Today asked Wharton marketing professor Pinar Yildirim what advice she would offer to Groupon’s next CEO.
K@W Today: What are Groupon’s biggest challenges?
Pinar Yildirim: The firing of Groupon’s CEO came after the company had been in trouble for months. [Mason] has left, but the big problems that led to his firing are still hanging over the company.
The Groupon business model relies on a “two-sided” network. On the one side are businesses that provide discounts, and on the other side are the customers. The difficulty is aligning the needs of the two sides. For example, businesses benefit from Groupon when they increase market share or sell excess capacity/inventory. But Groupon relies on customer “disloyalty” since it encourages customers to switch to whichever firm offers the deepest discount. Thus, the current Groupon model does not allow for a perfect alignment between the two sides of its network, and it is questionable how sustainable such a business model can be.
The bigger issue facing Groupon is the dense competitive market. There are too many players offering deals, and this market is more segmented today than ever. [Also], Groupon has to be able to compete with specialized discount sites. For example, some discount sites target higher income consumers by specializing in high-end or luxury offers — Jetsetter, Gilt Groupe, etc. Others target consumers based on products; [they] offer discounts only for shows, food, travel, etc.
More importantly, with the entry of Google Offers and Amazon Local, Groupon will have very fierce competition. Google, in particular, has incremental competitive power because it can combine search with discounts. Whenever a consumer searches for a service or product offering, Google can redirect them to its own offers.
K@W Today: Will the introduction of the company’s “Groupon Goods” venture (which sells discounted goods over the Internet) help to shift the company’s prospects in any way?
Yildirim: Groupon Goods will potentially increase revenue. It is offering a broader range of products from many producers. [For that reason,] it is less dependent on the challenges of the service sector. Second, it is moving from a “local offers” model to a nationwide offers model, increasing the consumer base.
K@W Today: Any advice for the incoming CEO?
Yildirim: Aiming for a sustainable business model should be the target of the new CEO. Daily deal websites can be successful if they align discount offers with business needs. For example, a new store might be in need of increasing awareness, whereas a more established business might need to get rid of excess inventory or fill excess capacity and might benefit from offering Groupons seasonally. This alignment requires optimization of when to offer Groupons and how many Groupons to make available.
The new CEO should focus on programs that encourage repeat buying. If consumers have an incentive to repeat-buy from businesses that offer discounts, more and better firms may want to partner with Groupon. When businesses win, Groupon wins. So, [there needs to be] more focus on delivering to the business side.
I also recommend lifting the Groupon image by giving discounts on higher quality items — and some exclusive offers — particularly via Groupon Goods. Currently, the offers have very little competitive power and little branding.

Featured Professors: Pinar Yildirim

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'Contagious': Jonah Berger on Why Things Catch On

If you have watched and shared PSY's "Gangnam Style" video or gone into an unknown restaurant simply because it was full of people and appeared to be popular, you have the basis for understanding what makes things go viral. In Wharton marketing professor Jonah Berger's new book, Contagious: Why Things Catch On, he identifies six principles that cause people to talk about and share an idea or product. Knowledge@Wharton recently sat down with Berger to learn more about his findings, including why people share cat memes, which organizations and individuals have conceived and implemented the most successful viral campaigns -- from Blendtec to 'Movember' -- and why making something contagious does not have to be expensive.
An edited transcript of the conversation follows.

Knowledge@Wharton: Jonah, thank you for being here today. Your book is all about what makes different products or ideas catch on. What do you think are the biggest misconceptions out there about why things go viral?
Berger: The easiest place to start would be cats. [If you ask], "Why do things go viral?" people usually give one of two answers. They say, "Oh, it's random. It's luck. It's just chance." Or they say, "It's cats." If you look on the web, there are viral cat pictures, so it must be cats that drive things to go viral.
There are definitely some cat things that become popular, but that really doesn't tell us anything about why most things go viral. It doesn't tell us why some cat videos are shared and others aren't, and it doesn't tell us why things that have nothing to do with cats go viral. It's like noticing that Bill Gates, Bill Cosby and Bill Clinton are all names that start with "Bill" and deciding to name your child Bill because that will make them famous. It's messing up correlation and causation.
What the book is all about is teasing apart the luck and random stuff, with science, and actually trying to understand what makes people talk about and share things.
Knowledge@Wharton: In the book, you actually outline a framework of six principles for why things catch on, using the STEPPS acronym. Can you describe those for us and discuss how you developed them?
Berger: The books talks about the six key steps to drive people to talk and share. STEPPS is an acronym for:

• Social currency:, It's all about people talking about things to make themselves look good, rather than bad
• Triggers, which is all about the idea of "top of mind, tip of tongue." We talk about things that are on the top of our heads.
• Ease for emotion: When we care, we share. The more we care about a piece of information or the more we're feeling physiologically aroused, the more likely we pass something on.
• Public: When we can see other people doing something, we're more likely to imitate it.
• Practical value: Basically, it's the idea of news you can use. We share information to help others, to make them better off.
• Stories, or how we share things that are often wrapped up in stories or narratives.

Knowledge@Wharton: Which of these principles do you think are most difficult for companies or individuals to harness when they are trying to promote a product or an idea or just get something to catch on?
Berger: People often say, "Well, we have to do something crazy." Guerilla marketing and viral marketing is about dressing people up in chicken suits and running down to the subway and handing out $100 bills. That will get attention. That's really not the right answer. It is true that remarkable things get talked about and shared. But there are a lot of other drivers of sharing. One big thing we talk about is triggers -- how cues in the environment remind us of related things and cause us to talk about them. If I said, "peanut butter," you might think of "jelly." If I said, "cat," you might think of "dog." Peanut butter is basically a little advertisement for jelly. It's not actually there, but it reminds you of that related thing. Cues in the environment can remind us of products and ideas and make us talk about them more. Companies often don't think about, "Well, what in the environment is going to remind consumers of my product or idea?"
Similarly, emotion. Companies recognize, "Hey, if we can get people to feel emotional, we'll get them to talk and share." Most companies get stuck because they say, "Well, hold on. Our product isn't naturally emotional" or "Our product isn't naturally remarkable -- we just can't do anything about it." What the book is really about is showing both companies and individuals that anyone can craft contagious content. It's not about having to have the right product. You have to think about what makes people talk about and share and then build that into your product or messaging. Any product can be remarkable. Any product can be emotional. Think about what makes people feel emotion or what makes them think something is remarkable, and then build that into your product or idea.
Knowledge@Wharton: There's actually a great example of this in the book that has to do with blenders. Tell us about how the people at Blendtec made blenders fit this framework.
Berger: You could say new Apple products or hot cars or exciting Hollywood movies are naturally remarkable products. But who would talk about cement or toilet paper or a household appliance like a refrigerator or a blender? There's nothing remarkable about a blender. But there's a great example of a company, Blendtec, that actually made a blender video that's gotten more than 10 million views.... They have a series of videos called "Will it blend?" -- which has over 150 million views -- where they stick all types of different things in a blender.
In my favorite video, for example, they stick an iPhone in the blender. They actually drop an iPhone in. They close the top, they press the button, and you watch the iPhone get torn up by this really, really strong blender. It gets reduced to shreds. Little shards of glass and all the other things that make up an iPhone. Lots of smoke. At the end of the day, it's basically powder. Now you've never seen a blender tear an iPhone. You've never imagined that a blender could do that to an iPhone. Yet you see it, and it's pure remarkability. You're so amazed you have to share that with someone else because it's so impressive. People share these videos, even though they are about a blender. The point at the end of the day is anyone can craft contagious content. Yes, they are selling a blender. Yes, a blender doesn't seem like a remarkable product. But by finding the inner remarkability in their product, they got people to talk and share.
Knowledge@Wharton: What fascinated me about it was that the marketing director who had been hired realized that something they were doing every day -- testing blenders -- held opportunity for jumpstarting buzz for the firm.
Berger: Yes, George Wright, a new marketing hire, comes into the office. He notices a pile of sawdust on the floor on one of his first days at work. He asks, "Are we expanding the office? Why is there sawdust on the floor?" His colleague responds, "No, the CEO is doing what he does every day: trying to break blenders." The CEO would take two-by-four pieces of wood, golf balls, Bic lighters and throw them in the blender to see if the blender was tough enough to withstand the punishment. He wanted to make a really strong blender.
George saw this and said, "This is a fantastic idea. This is gonna be a viral home run." He took a $50 marketing budget --- not $50 million, not $50,000 -- but literally $50. Bought a white lab coat, some of those goofy glasses you often see people wear when they chop wood or something, and just filmed the CEO doing what the guy was already doing: trying to break blenders.... They distributed it to their mailing list, they distributed it to others, and it caught on like wildfire. People saw it, and they had to pass it on and share it with their friends.
It's a great example of why it doesn't take a huge marketing budget. It doesn't take a marketing genius -- though they are smart marketers -- to think about this. What it takes is understanding the psychology behind social transmission -- what makes us talk about and share things. Then by generating content or building in features of your products, you create that viral user growth.
Knowledge@Wharton: On the Internet, it's often user-generated content that manages to generate giant page-view numbers and the viral sharing that many companies with much larger budgets and many more resources at their disposal would just die to have. What can companies learn from that?
Berger: Companies often think it's about advertising [or about] creating a really slick message and putting it out there. [They think] it will be really persuasive. It's more about being open, being authentic and letting consumers create their own content. But also, creating ads that build in an understanding of why people talk about and share things. People don't want to share things that look like ads. They don't want to look like they are a walking advertisement for a company. But they will share really engaging content, even if that content happens to relate to a brand.
A few years ago, Burger King had a great example on the web, the subservient chicken. You could go to this website, and you could type in whatever you wanted. This guy in a chicken suit would do whatever you typed in. For example, "Do a back flip," and the guy in the chicken suit would do a back flip. "Hit a home run," and he would look like he's hitting a home run. But it wasn't heavily-branded. It didn't say, "Burger King, Burger King, buy Burger King" all over the page. The more you brand something, the more it looks like an ad, the less willing people are going to be to talk about and share it. You need to design content that's like a Trojan horse. There's an exterior to it that's really exciting, remarkable and has social currency or practical value. But inside, you hide the brand or the benefit. "Will it blend" is a great example. It's not a highly branded piece of content. People are watching it because they love to see this blender tear through things. But along the way, they're learning about the brand. If, instead, they said, "Buy this blender. It's fantastic. You'll love it," people wouldn't share that with others, because it seems like an ad.
But that's not just online. It also happens offline. There's a great local Philly example of a restaurant here called "Barclay Prime," that has a $100 cheesesteak. Now, you might sit there and ask, "$100 cheesesteak? What could be on a $100 cheesesteak?" Well, it's everything from Kobe beef to lobster to truffles. It comes with a little bottle of champagne. It's a remarkable product, particularly for Philly, where we often think about cheesesteaks. Again, people don't want to seem like an advertisement for Barclay Prime, but they do love to talk about this remarkable product. Along the way, they talk about the brand. It's about understanding what consumers like to talk about and then attaching your brand or your idea to a story that they want to share.
Knowledge@Wharton: You talked a little bit at the beginning about how a lot of people seem to think that going viral or becoming contagious is about luck, but that these six steps are what are really coming into play. For a company trying to harness these six steps, what kinds of issues do you see? How much do opposing market forces come into play? And what about sheer luck? Does luck have anything to do with it at all?
Berger: Imagine you're a baseball player, and you're hitting pretty well, but you want to raise your batting average. This book will show you how to raise your viral batting average. Can I guarantee you'll be the next "Gangnam Style" with a billion views? Definitely not. I can't guarantee that. But I can guarantee that it will raise the likelihood that consumers talk about and share your ideas. If a person on average tells one person, we can increase it to two. If half the people are talking about your product, we can increase it to 60%. We have evidence-based principles that show why people talk about it and share. There is some luck to get a billion views. You can't mathematically put something together to guarantee that you'll get that many views. There is a snowball effect on the web. But you can guarantee that more people will talk about your brand or more people will share your idea, if you understand why people talk and share.
Knowledge@Wharton: How have changes in the advertising and technology landscapes altered the nature of how things become contagious and, conversely, the reasons or the speed at which they maybe become uncontagious, or just peter out?
Berger: Advertising is great for broad awareness. It's great because it makes many people aware that your product exists. But it's not very persuasive. If we think about it, we're much more likely to believe what our friends say than to believe what ads say. I'm not against advertising. If you have enough money to buy a Super Bowl commercial, and that's worth doing on your end, it's definitely worth doing. It gets broad, broad awareness. But it's not going to be very persuasive. What's going to be persuasive is hearing from a friend or a colleague or someone you know that a product is good. Ninety percent of people believe what their friends say. Only about 30% of people believe what ads say. What I would say to businesses and organizations is, advertising's not a bad thing. Indeed, it is one way to encourage word of mouth. But they should think about why people are going to talk about and share your ads once they've happened. How can you build content, both online and offline, that people will talk about and share?
This conversation is focused a lot on the web, and the web is important. But actually, much more word of mouth is offline than online. There has been so much focus recently on social media technologies -- Twitter and Facebook and the newest shiny tool that's out there. But if you think about it, five or six years ago you could have been an expert on MySpace. You could have gone to a talk that says, "MySpace is where you should spend all your resources." You could have gone after that tool. Now that useful knowledge would be pretty worthless, right? No one's really on MySpace anymore. Will Facebook be around in 10 years? Will Twitter still be around? I don't know. Will people still be talking and sharing? Certainly. It's more about understanding why people talk and share, whether it's online or offline, rather than focusing on the technologies they are sharing through.
Knowledge@Wharton: Can you give an "offline" example of something that went viral?
Berger: One example I really like is the example of Movember. Nonprofits have a problem: most donations to nonprofits are pretty private. You know what you donate to, and you might even know what your spouse or your best friend donates to. But you don't really have any idea what your friends or people at the office donate to. That action is pretty private. But because it's private, it's hard for that to catch on more broadly. If you can't see what others are doing, it's hard to imitate it. One idea I talk about in the book is making the private public -- making what people are doing more observable or visible. A favorite example of that is this campaign called "Movember."
A number of years ago in Australia, a couple of guys got together. They were drinking beers. They were talking and thinking about what would be fun to do just as a joke, for kicks. They decided to have a mustache-growing contest. They grew their best mustache. It happened to be the month of November, so they called it Movember. The next year, they had so much fun they wanted to do it again. They decided to raise money for men's cancer. There are lots of campaigns for women's cancers: the 5K races, Susan G. Komen Foundation and so on. Not so much for men's cancers. But they had the really sharp idea of rather than just asking people for money, they would use mustaches as a public signal of that private behavior. For the month of November, you would grow a mustache, and you would ask people to donate money to support the cause for men's cancers. But what's really nice about that behavior, it's a very public behavior.... If someone's part of the campaign, you can see that he has a mustache on his face. If somebody in your office, who is a pretty buttoned-down guy starts sporting a mustache suddenly in the month of November -- a big Rollie Fingers sort of mustache -- you're going to ask them, "Why are you doing this? What's going on?" That will encourage them to talk about and share this Movember campaign, which will encourage you to do the same thing, either that year or next year. This is entirely offline, but public is a really simple way of getting ideas to catch on.
Think about Apple's headphones. It used to be that we all carried portable CD players. It was like carrying a pizza. You had to run like this, to make sure it didn't skip. Then, they came out with these things called mp3 players. Really great technology, but they were super expensive. Is it worth adopting this new product? How do I know if it's worth adopting this new product? If you looked around on the subway or the bus, you couldn't tell [which products people were using] because everyone's headphones were black. It was impossible to see what device someone was using, as opposed to another device.
But what Apple did really smartly is they used white headphones. Once you start seeing a number of people wearing white headphones, you say, "Wow. A lot of people are using this. It must be really good," which encourages you to adopt that product as well. It's just like if you've gone to a foreign city and you don't know where to eat. How you decide? You look for a restaurant that's full of people. It's a totally offline example. But you assume if it's full of people, it must be really good. Thinking about how to make the private public, particularly in an offline environment, is a great way to help your product catch on.http://knowledge.wharton.upenn.edu/article.cfm?articleid=3206

25 Things You'll Have to Explain to Your Kids About Marketing One Day

Posted by Pamela Vaughan

1) What direct mail was.

2) That there was this thing called the Yellowbook, and that's how people would search for local businesses.

3) How there was no such thing as internet marketing ... because there was no such thing as the internet.

4) How there was no such thing as mobile marketing either, because people's cell phones looked like this ...

And before that, this ...

5) In fact, the only way to connect to the internet was to dial in on your computer through a modem.

6) And people would get suckered into picking up cold calls from telemarketers because there was no caller ID or Do Not Call Registry.

7) You couldn't skip through TV commercials either.

8) How most websites looked something like this ...

9) And buying or renting lists were acceptable ways of growing your email marketing database.

10) How companies could spam the heck out of your inbox with no legal repercussions whatsoever.

11) And how Facebook was originally just for Harvard University students, and it was ad-free.

12) How it was once cool to have banner, skyscraper, and pop-up ads on your website (and there was a time when people didn't automatically tune them out).

13) What this big thing was used for ...

14) And how the only way to buy things without going to a physical store was through one of these.

15) How keyword stuffing, page sculpting, and buying inbound links were once considered SEO best practices.

16) And there was a time when younger demographics spent more time doing this ...

Than doing this ...

17) How marketers pretty much had to guess about which of their marketing tactics were working because marketing analytics didn't exist.

18) And how this was the only social networking you could do ...

19) How the only thing marketers could automate was their out-of-office voicemail.

20) And that it once wasn't against the law to pay your customers to leave you positive online reviews.

21) How strangers used to knock on your door during dinner to try to sell you things.

22) How these were once the main way people consumed content ...

23) And this was once an innovative new advertising platform ...

(This is called a "radio," by the way.)

24) How marketers used to have to bug their IT departments to make changes to their websites.

25) What outbound marketing was ;-)

What else would you add to this list? Share your thoughts in the comments below!

Read more: http://blog.hubspot.com/blog/tabid/6307/bid/34239/25-Things-You-ll-Have-to-Explain-to-Your-Kids-About-Marketing-One-Day.aspx#ixzz2NEtMxs1x

25 Email Marketing Tips and Tactics

Many marketers and non-marketers share a mutual concern for doing email marketing the right way. They often wonder if the emails they’re sending are making it to the inbox and pleasing their recipients, and they are curious about how they can improve the response rates of their email campaigns.

With these 25 email tips, you can improve the quality and consistency of your emails for your subscribers.  To make it easy to read, I’ve broken it up into five different sections.

If you have a tip you’d like to add, post it in the comments at the bottom.

• Always get permission – Without having permission (meaning every subscriber asked for you to email them), spam complaints will increase and people will ignore your emails — even worse, they may opt out altogether. Aside from upsetting your “newfound” subscribers, you will probably also get the boot from your email service provider for violating their policies.
• Set expectations at the opt-in – Tell your potential subscribers what you will send them and how often. It shouldn’t be a shock that nobody wants an inbox full of email from you.
• Confirm with double opt-ins – While it’s a slight barrier to get your emails, double-opt-in protects you and your email provider from incurring spam complaints. Also, it’s smart since you will be confirming that someone actually wants your emails and is willing to click a link to do it.
• Utilize email marketing campaigns instead of ‘newsletters’ – Newsletters are so 2001. With an email campaign, you can attract specific prospects and send them emails related to a particular topic.
• Make the offer at the right time – Nothing annoys email subscribers more than getting an offer at the wrong time in their inbox. Strategically and calmly earn the opportunity to make a sale by providing the helpful and relevant content that they originally signed up for.

• Match your email to your brand – Include your company logo and colors on all your emails for consistency. Doing this will make your emails familiar and expected.
• Look professional with a consistent color scheme – Colors are a major component of your brand. If you need help finding a good color scheme, check outkuler or COLOURlovers for inspiration.
• Design the email and landing pages so it’s easy for mobile users – Realize that the popular iPhone has a viewable space of 320 x 356 pixels. That’s not much compared to the real estate of your computer (probably above 1024 x 768). This means you should condense the width so they can read the email without resizing the message.
• Make your email readable without images enabled – For privacy reasons, most email clients disable images unless the user allows it. Because of this, any images you include in the email should have descriptive text set for the Alternative attribute.
• Use fonts that reflect the style and tone of the email message – Choosing the right font size and family is a big deal. You wouldn’t take a business proposal seriously if they emailed you with Comic Sans. Choose a font that everyone has instead of one that looks good on your computer (e.g., Arial, Verdana, Times New Roman or Tahoma)

• Reinforce expectations of the email campaign – This doesn’t mean using the original IP address and convincing people your email isn’t spam. Rather, tactfully explain the basis of your email message and inform them if there are future emails they can expect from you.
• Personalize the emails and include more than their name – Make your emails personal and include more than their name. You’ll hopefully know why they signed up to your list and you can presume that in your copy by making it relevant.
• Economize your message to maintain focus – People are pressed for time. They don’t want to read more than a few paragraphs to decipher what you’re trying to say. Write what you need in the most efficient way possible. A tip I learned from an esteemed copyeditor is to write what you want, then cut the length by half. It’s remarkably helpful.
• Write for people, not robots – If you use “F.R.E.E.” in your email and it’s not an acronym for “Foundation for Research on Economics and the Environment,” you’re doing it wrong. Just write for people and the spam filters will let it slide.
• Make your emails engaging and solicit feedback – As a reader, I like it when the sender asks a provoking question and solicits a response on their Facebook or simply via reply. This is good not only for the social interaction, but it will also educate you on what people think about your emails.

• Test your email messages on different email clients – Once you have the perfect-looking email, test how it looks on many different email readers. There are a few affordable services available that let you preview how it looks or you can simply try it yourself by setting up free email accounts on AOL, Yahoo, Gmail and Hotmail and downloading a copy of Mozilla Thunderbird.
• Make it easy to unsubscribe – When users don’t want to receive your emails, don’t bury the unsubscribe link. Make it visible because receiving an unsubscribe is much better than a spam complaint.
• Send emails in multipart for maximum readability – Combine the best of plain-text and HTML email by sending in Multipart. For devices that don’t support HTML, they will show the message in plain-text. Conversely, if a device supports HTML, they will show it in HTML.
• Use a pre-header to take advantage of email previews – Pre-headers are simply the first line of text in an email located at the top. Email services like Gmail display the pre-header directly after the subject line, and it’s a good idea to summarize the email right there.
• Try a plain-text format if you use HTML – Mix up your email routine once in a while and use a plain-text email if you typically send in HTML. People frequently perceive plain-text emails are more intimate and personal from the sender, so use it sparingly.

• Respect your subscribers’ time and interests – Don’t hammer their inbox with useless emails. Plan out your emails and respect subscribers’ interests so they don’t receive more than a couple messages per month.
• Let people re-confirm their interest after nine months – Getting permission is half the battle; retaining it is the other half. Permission typically expires after nine months, so it’s a good idea to ask people to confirm their interest in receiving your emails and offers. The best part is, you will discover the most loyal subscribers.
• Send emails to smaller, more targeted groups in your list – With advanced email marketing, you are able to track which links and emails intrigue your audience. Leverage this data to identify different sub-groups to send tailored messages. You will be surprised at the increase in response rates when you do this.
• Use more than email to stay in touch – Email is the holy grail of marketing for small businesses, but it doesn’t end there. As the relationship with email matures, get more information on your contacts by asking for their address and even mobile number. Consider these additional means to stay in touch with your audience.
• Ask for and use subscribers’ feedback – There are two types of feedback: passive and active. Passive feedback is looking at which links people click on, which is an indicator of the aggregate interest in your email messages. Active feedback is when people ask you a question, suggest an idea or make a comment. Leverage this feedback to improve your email campaigns.

What email marketing tips do you have to share with other business owners? Share it in the comments below!http://bigideasblog.infusionsoft.com/25-email-marketing-tips-and-tactics/

Multi Level Innovation in Rewards

The examples that follow bring home the point - that innovation needs laser focus on each stage of your rewards programs.  (Click on the highlighted part of each example to get an indepth understanding of each one).

#1 Setting Goals
Tiger Fuel aimed its rewards program directly at a brand perception problem.

#2 Who Should Be Targeted
Hilton maximized brand value in China by recognizing locals who were known for their work ethic.
Vista bank targeted both consumers and businesses with a community oriented rewards program.

#3 When to reward
Givex and Transacta partnered to deliver a solution for companies to affect purchase decision making in real time

#4 Choosing platforms
Jersey Mike’s uses NFC for customers to collect rewards
PointBank uses a social activity tracking system to reward customers for social activity

#5 What to reward
Vista Bank rewards customers for using social to spread the word about its loyalty program
Shopkick empowers retailers to rewards store visits rather than only purchases

#6 What rewards?
Loyalty Shares takes alignment of company and customer to next level:Company shares as rewards puts customers in the company’s shoes and forces them to look for win-win’s in purchasing process.http://www.loyalty-ip.com/article-104-multi-level-innovation-in-rewards

http://www.loyalty-ip.com/news-767817-loyalty-shares-changes-the-game-in-loyalty-rewards

SMB Nation Credentials

Mobile solution drives SMB retail loyalty programs

http://www.zdnet.com/mobile-solution-drives-smb-retail-loyalty-programs-7000002200/

A new service, MercuryLoyalty, harnesses mobile phone numbers to let small and midsize retailers glean customer insights that they might not otherwise be able to collect.

The service, offered by Durango, Colo.-based software developer Mercury is meant to replace the traditional methods that small retailers typically use to track customer purchases, such as paper card-punch methods. The store owner or manager basically encourage people to sign up (if they want) by sending them a text. Once a profile has been created, future purchases can be credited and tracked by collecting the person's number. (The process is explained above.) 

The making of India's budget

 

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As winter takes hold of northern India at the end of every year, in New Delhi's corridors of power, a well-oiled bureaucratic machine moves into a higher gear, in preparation of India's annual Budget, perhaps the country's most important yearly statement.

 

But the making of India's Budget — a complex, expansive set of documents that details the country's income, expenditure and economic policy, among others — actually begins late into the fall, with the issuance of what is known as the Budget Circular in September.

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That single document remains essentially static in its form and content, and informs each department and ministry in the government of India to begin work on estimation of its expenditure and, in some cases, the revenue generation for the coming year.

 

Specific deadlines are mentioned by the Finance Ministry's Budget Division, the key administrator of the entire process — and unusually for a government and bureaucracy often accused of lethargy, these deadlines are mostly met.

 

On the expenditure side, all public sector undertakings (PSUs) are brought in dialogue, along with their respective ministries, the Planning Commission and, of course, the finance ministry officials to churn out the Internal and Extra Budgetary Resources (IEBR).

 

The Planning Commission, in fact, is the main agency through which all discussions on the 'Plan' expenditure, or the Gross Budgetary Support, in government parlance, are held, while the Finance Ministry helms the activity on the 'Non-Plan' side.

 

But that's only one part of the process.

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The government also needs to figure out how much resources it will be able to raise, and part of this is done through the Budget Circular. On the other hand, crucial tax estimates are tricky business, and two specialised divisions within the Finance Ministry's Revenue Department are tasked with producing these numbers. Suggestions on the country's tax framework are also thrown up, and duly considered by the core Budget Team, comprising the Finance Minister, a clutch of secretaries of the Finance Ministry as well as the Chief Economic Advisor.

 

It is also this team that pours over the 'Blue Sheet', a secret summary sheet of the Budget that is constantly updated with the major numbers, but very closely guarded. These numbers, as the New Year settles in, are slowly finalised. Through January, the Finance Minister not only continues to meet with the core Budget team and others such as the Prime Minister and Planning Commission deputy chairman, but also other stakeholders including industrialists, agriculturists and trade unions.

 

Yet, the great balancing act that is central to the Budget is no easy task.

 

Although, as former Finance Ministry bureaucrats attest, the entire Budget process runs like a well-oiled machine, a week before the Budget is presented in Parliament, it moved into a higher gear. Over a 100 officials are willingly quarantined inside the Finance Ministry's basement in New Delhi's North Block, where the Budget press is located to ensure the absolute secrecy of the documents. For almost 10 days, these officials live and work in the basement, with no contact with the outside world, except one telephone that receives calls, that, too, monitored by the Intelligence Bureau, which is tasked with the ministry's security.

 

In such a 'war-like' atmosphere, the Finance Ministry begins work on the Budget speech that will be read out on the floor of the Parliament, but each minister differs in his or her style. Some consult bureaucrats and their Chief Economic Advisor assiduously, while others just write it out on their laptop and pass on the pen drive to the mandarins.

 

In either case, copious copies of the speech and the remaining documents must be ready by the morning of February 28, when they are counted, trucked to the Parliament and then counted again before delivery. But the core Budget team embarks on a different journey, travelling through the Rashtrapti Bhawan to meet the President, before settling in for an unusual Cabinet meeting in the Parliament.

 

It is only after all this that the Finance Minister finally presents the Budget to the Parliament — and the people — thereby, marking the end of a process that lasts nearly six months and encompasses the entire government of the world's largest democracy.http://www.business-standard.com/article/budget/the-making-of-india-s-budget-113022600078_1.html