Predictions for the Groundswell in 2010 -- Twitter gets serious or gets bought

by Josh Bernoff

Emily Riley and our whole Groundswell team have just published our predictions for 2010. We serve interactive marketers, so these are marketing focused predictions. They are:

1. Companies' use of social councils will attain budgets and power.
2. Listening Platform insights will go mainstream.
3. Marketers will focus less son fuzzy social media metrics and more on real marketing metrics.
4. Twitter will become profitable or get acquired.
5. Facebook will get more hands-on to protect users' -- and its own -- interests.
6. Incompatible mobile devices and siloed social applications will shatter the social experience.

If there is one overarching theme, it's that social technology is now a mainstream part of what marketers do. Items like using Listening Platforms (e.g. Nielsen BuzzMetrics, Radian6) and a focus on metrics that matter to marketers are signs of this shift.

I'd also like to draw attention to the Twitter prediction. Twitter has been fiddling around, growing like mad without a business model, for years now. But in in 2010, growth is not sufficient. One of two things will happen. Either Twitter will have a business generating $100 million at an annualized rate by the end of 2010, or it's going to get bought by the likes of Google, Facebook, or Microsoft. I don't believe it can continue as a huge force that has no visible means of support. Do you?

Will online volunteers transform our economic recovery?

by Josh Bernoff

I've started to write for the DigitalNext blog on Advertising Age. This is my first post for them.

The last 12 months have seen not only a severe economic contraction but also a surge in online social activity. According to U.S. consumer surveys from Forrester Research, the proportion of online people consuming social content at least once a month grew from 48% in 2007 to 69% in 2008, and the growth shows no signs of stopping.

This is already transforming the world. As Tim O'Reilly has pointed out, Web 2.0 transforms. Classifieds become Monster.com, which gets undermined by Craigslist. Britannica fades in favor of Encarta, which gets pulverized by Wikipedia. Photo film becomes Snapfish, which is swallowed by Flickr. In each case the end state is free, people-generated and revenue-challenged.

A pessimist sees value erosion. But the value's not gone, it's just different. The consumer/creators get paid for their contribution in love, admiration, pride and a sense of belonging.

The online social world is driven by free, volunteer activity. Now add a horde of unemployed and underemployed digital talent, both those laid off and new college graduates who, when they reach the doorstep of the job market, find a sign that says "Sorry, We're Closed." While they wait for better jobs to appear, they're going to invent online tools that supplant the current ones -- tools whose modus vivendi is emotional, not financial.

What will they transform? Just about any economic activity is fair game. Transportation? Loans? Education? While the lack of available credit is grit in the gears of capitalism, there's no shortage of psychic income to exchange, or people with talent they can't sell right now. The sites these whizzes create may barely make enough coin to support the person who programmed them, but they'll undermine real money-making sites and businesses.

Amid the rubble of foreclosures and layoffs, this may just be a little green shoot that transforms the recovery. But in this new economy it will be reputation, support and sharing -- not just money -- that will make the whole thing go 'round.

Why Wal-Mart Will Succeed In Social Applications

by Josh Bernoff

I just got back from a trip to Bentonville, Arkansas, home of America’s largest and perhaps most controversial retailer. While there, I met with the company’s top management, IT staff, and a couple of social media folks.  

You may believe that this company will never “get it” – and that in any cases, it has so many enemies that entering the social world would be suicidal. Let’s see if I can convince you that Wal-Mart will become social media’s biggest success story.

Wal-Mart’s social saga starts with a couple of missteps, including a blog that was revealed to be funded by Wal-Mart’s PR agency, Edelman, and a Facebook application for college students that attracted lots of negative comments from Wal-Mart haters. But when 138 million Americans go into your stores every week, you shouldn’t ignore social media, and you can’t hide from it. Wal-Mart didn’t give up after these setbacks, they got up off the mat and tried harder.

Exhibit A: ratings and reviews. Walmart.com is one of the biggest Bazaarvoice installations in the world, powering a site that sells over a billion dollars worth of stuff every year. Wal-Mart is not afraid of negative reviews from customers – for example, the top rated bicycle on the site had 139 reviews including “7th gear skips fairly frequently. . . but at $150, you can’t expect not to find problems.” Wal-Mart is famous for driving hard bargains with its suppliers; we met their PR folks in one of the very windowless, grey rooms where those prices get beaten down. Reviews on walmart.com have most likely extended that power, as the company now has concrete evidence about which products consumers consider to have acceptable quality, and which not.

Exhibit B: the checkout blog. Wal-Mart’s buyer blog is still growing in popularity, but has enabled the company to join the conversation about products. It’s a genuine voice for Wal-Mart’s product folks, enabling them to explain decisions like choosing Blu-Ray over HD-DVD, (a choice that basically put the final nail in the coffin of the HD-DVD format). A post on Wal-Mart buying only milk from cows that don’t receive growth hormone generated a lively and in some cases uncomfortable discussion with 256 comments. Wal-Mart has learned to join the conversation, even in a world full of critics, and is not smothering those that disagree.

Exhibit C: elevenmoms.com. Emboldened by its experience, Wal-Mart tapped a colony of mommy bloggers who write about topics like how to feed your family frugally and how to get ready for Halloween. Don’t sell moms short – these are some pretty sophisticated blogs and Wal-Mart hasn’t changed them at all, they just link to them, and are now bringing the bloggers to Wal-Mart HQ for updates and suggesting products for them to review. Learning from past experience, Wal-Mart and the moms have both made it clear that these bloggers aren’t paid and are under no obligation to slant things Wal-Mart’s way.

Exhibit D: management attitudes. This may be the most powerful of all. Some members of Wal-Mart’s senior HR staff had read Groundswell and asked me to present on the social media topic to 75 senior VP and C-level executives from around the world, including CEO H. Lee Scott. We followed this up with a workshop similar to the ones I run around the country, in which people use the POST method to generate social application ideas. Could a group of C-level executives break into groups and successfully devise social applications? I started to get worried when I saw they’d put all the lawyers together as one of the groups.

What happened next amazed me. When I kicked off the workshop, I mentioned that they might be feeling a little hesitant about these new ideas, since they involve a loss of control. Lee Scott actually interrupted me to say “You’re wrong, we’re not hesitant, we’re ready to embrace this stuff.” And they were. What followed was some of the most rapid ideation I’ve ever seen. I can’t tell you in detail the strategies they came up with – they deserve the chance to develop and announce them when they’re ready – but every single one was a viable, customer-centered idea around concepts like customers saving money or sustainability (that is, green) ideas for Wal-Mart. Even the lawyers came up with a decent application. 

(For cynics who might want to believe this was done just to fool me, trust me, the world’s largest public company has better things to do than bring its top management together from around the world to fake out a business book author.)

Having done lots of these workshops, I’m aware there’s no way to know when these plans will see the light of day, but what I saw was a company open and receptive to embracing and empowering its customers and employees online, regardless of what they end up saying. In short, advanced groundswell thinking. 

Think about the situation Wal-Mart is in. It has plenty of detractors, hundreds of people who feel the company’s labor practices, effects on small-town America, purchases of products from China, and general ways of doing business are a threat. These Wal-Mart haters have gathered in sites like Walmartwatch.com, tend to be socially savvy, and are ready to pounce on any Wal-Mart news or rumors and spread them using social technologies.

But on the other side of the ledger are hundreds of millions of customers. When these customers think about Wal-Mart, their most likely thought is “they sell the stuff I need at really low prices.” If you don’t believe me, see what they’re saying right now on Twitter – it’s mostly about saving money. Wal-Mart wants to turn these millions of voices to their advantage, to use them as a counterweight to their detractors. And with more and more Americans participating in social technologies, they can do it. 

Have I convinced you?

The Wal-Mart haters won’t go away (I expect plenty of them to comment on this post, for example). But this company has legions of people who think of it as a place to get good stuff cheap, and a commitment to pro-social activities like saving energy and responsible sourcing. It’s going to be a battle out there in the social sphere, and Wal-Mart will continue to take its lumps. But with so many customers on its side, I think Wal-Mart will win that battle. Just watch.

Forrester Research is hiring -- become an analyst or researcher on our global social applications team

by Josh Bernoff

If you see how fast corporate investments in social technology are growing, it won't surprise you to learn that Forrester is hiring. We're expanding our team in the wake of all the interest stirred up by Groundswell.

We're hiring for the positions of senior analyst and researcher. These are plum jobs, because they will put you right in the center of transformation that's happening as companies begin to embrace social applications.

I've been an analyst for 13 years and it's the most fun I've ever had  in a job. You'll spend your time speaking with people in companies who are actually implementing social applications, gathering information about what works, what doesn't, and where the industry is going. This, combined with our extensive consumer research data, forms the basis of our research content. You write documents on topics of interest to clients or work with clients on how to build these applications.

In the analyst job, we're looking for people with real experience building these social applications for businesses, either at a company, in an agency, or in a technology vendor.

The researcher job is a little different, since it focuses directly on the data collection. The researchers help write and analyze the results of the surveys we use and help write research documents driven off the data. That's why the researcher job requires a strong statistical backgrounds with survey experience.

Our current analysts on this team are working in Cambridge, Massachusetts; Foster City, California; New York; London, Paris, Amsterdam, Sydney. You could work with us in any of these places, or elsewhere. For this position, due to the need to collaborate freely, we're most inclined to hire analysts who can work in Cambridge or Foster City.

Forrester is an extremely collegial place, with analysts around the world collaborating freely with each other. We keep driving forward into new areas of knowledge. Working here is a blast.

Here's how to apply. Click to see the description for the senior analyst job or the researcher job. Then click "apply online." I hope I get to work with you!

Google Friend Connect -- making open social easy

by Charlene Li

Google announced that it would be releasing Google Friend Connect this evening (link won't work until Monday evening.) The idea behind Friend Connect is to give Web masters the tools to easily add social features to their sites. This is what Google announced:

"With Google Friend Connect (see http://www.google.com/friendconnect following this evening's Campfire One), any website owner can add a snippet of code to his or her site and get social features up and running immediately without programming -- picking and choosing from built-in functionality like user registration, invitations, members gallery, message posting, and reviews, as well as third-party applications built by the OpenSocial developer community."

What Google is essentially doing is making it easy to tap into new, emerging standards around social features. These standards specifically deal with identity (OpenID), data access rights(OAuth), and social applications (OpenSocial). These are all standards that have emerged in the past six months and are laying the foundation for open social networks. Friend Connect is Google's way to make these new standards more accessible to Web site owners who don't have legions of developers at the ready.

Dan Farber at CNET has an excellent review of how Friend Connect works (and what it isn't).

One question I'm hearing is why Friend Connect is being announced now, especially on the heels of MySpace and Facebook announcements last week. Google is tapping into the "all things social" heat of the moment, but it's adding a different perspective -- not as a data source and social network "owner" but as an enabler. It's played this role well in the past with search and mapping APIs but make no mistake -- Google wants to spread its tentacles into the social Web.

The biggest buzz right now about social networks is not about them becoming more open, but about how they can't make money. I expect that at some point in the future, participating sites will have the option of enabling monetization engines via AdSense that tap into the deep profile and user data flowing through Friend Connect -- all done, presumably, with clear user approval and transparency.

For the readers of this blog, how interested are you in adding social features to your site? And if you are interested in doing this, what features would you want to add first? For myself, I would love to add links to identities/profiles for the people who add their comments to posts (again, assuming that they provide permission to do this). That would provide greater context for the comments and potentially stir even more discussion.

Facebook Connect - another step to open social networks

by Charlene Li

Facebook just announced "Facebook Connect", which they position as the natural evolution of Facebook as an open platform, which started from their initial API in 2006 and expanded with Facebook Platform in May 2007. This is how they describe Facebook Connect:

"Facebook Connect is the next iteration of Facebook Platform that allows users to "connect" their Facebook identity, friends and privacy to any site. This will now enable third party websites to implement and offer even more features of Facebook Platform off of Facebook – similar to features available to third party applications today on Facebook."

Details on the four main feature -- Trusted Authentication, Real Identity, Friends Access, Dynamic Privacy are below in the extended post. Overall, this means that all of the fun stuff that developers are building into apps on Facebook Platform will now be available for third-party developers to build into applications OFF of Facebook.com.

I spoke with Ben Ling at Facebook, and the hypothetical example he used was yelp.com. If I link my Facebook identity to my Yelp identity, I'll be able to port over my profile, my content, my reviews. Also, I'll be able to see if any my Facebook friends are also members of Yelp -- and be able to automatically have our friendships authenticated and visible on Yelp.

This is the beginning of the future I laid out earlier this spring, where social networks will be like air -- everywhere you need and want them to be. Facebook has a distinct advantage in this space, given its vibrant member base AND its relationships with developers who are already creating these social apps. Ben gave me some startling numbers: 24,000 Facebook applications, 350,000 developers on Facebook Platform, and 70 million Facebook users who have installed an app.

So in a few weeks, we can expect to see Facebook leaving the confines of its server, allowing users to take their Facebook experience anywhere they want. Instead of damaging itself and eroding the value proposition, Facebook is extending the reach of its social network through the Web.

With Yahoo! Open announcing and MySpace in the data portability game, it's now a battle not for just users, but a race to see who can open faster -- and more importantly, play well with other sites. Remember Facebook Beacon? That was an innovative program with partner details not very well thought out or implemented. I don't expect Facebook to make the same mistakes and if anything, they are ahead of the game having learned from that painful experience.

I did ask Ben about the timing of the announcement, coming as it does on the heels of MySpace announcing that it was joining the Data Portability Project. He said, "Openness is part of our DNA, We want to be transparent about our intentions, about the type of functionality we will offer to developers. There is a lot of mistaken perception that we are a close community."

So welcome to the race -- and look for a lot of interesting things to happen as the giants in this space - MySpace, Facebook, Yahoo!, Google, Microsoft -- all try to outdo each other in connecting with other sites. I for one am very much looking forward to it -- good bye social silos!

What "dream applications" would like to see developers build in this brave new world of social networks being extended into other sites? And what concerns do you have, especially if you work on a site that could be linked to these social networks? Let me know in the comments below or email them to me at cli at forrester dot com.

Yahoo! Open throws down the gauntlet for the open social graph

by Charlene Li

Yahoo! unveiled Yahoo! Open at O'Reilly's Web 2.0 Expo today. In a nutshell, Yahoo! is doing the following:

1. Rewiring Yahoo!. They are making it possible to create applications that can be shown throughout all of Yahoo!. That means search, mail, front page -- everything.

2. Open Yahoo! to developers like never before. Third party developers will be able to write applications that appear throughout Yahoo!. That's right -- you can write a mashup that integrates Yelp reviews into search results that appear anywhere -- on search results or even the home page.

3. Making Yahoo! more social. Yahoo! has over 10 billion connections lodged inside its various services -- think about all of the relationships expressed in address books, Messenger buddy lists, and most importantly, Yahoo! Mail flow. You'll be able to have your social graph appear throughout Yahoo! as a results (more on what this will look like below).

For me, this is a significant step forward in the next phase of social networks and the social Web. I wrote about this last month in a post about the future of social networks, where social networks will be like air. It makes no sense that your social connections be locked up in a social network -- when I receive a message within Facebook, there's no way to forward to it my work colleagues, friends, and family who are not on Facebook. And that significantly reduces the effectiveness and value of Facebook to me.

Yahoo! is clear that they are NOT creating another social network. Yahoo! CTO Ari Balogh said in his Web 2.0 Expo speech, "This is about making Yahoo! social in every dimension. Social is not a destination -- it's a dimension and it will infuse all aspects of a consumer's experience on the Web."

I couldn't agree more. Yahoo! is the foundation for hundreds of millions of users every month (Ari said that 500 million people worldwide use Yahoo! each month). But the real potential of this is that the social experiences that a person has on Yahoo! will be ported to other sites. In March, Yahoo! announced that it would support OpenSocial, meaning that applications developed for and on Yahoo! will be portable to other OpenSocial sites like Google and MySpace.

The potential here is that what will become portable is more than just the applications, but also the social graph of each Yahoo! member. There are still plenty of details to be worked out, in particular, control over each person's social graph. But in my discussions with Yahoo!, I'm confident that they will take the appropriate measures to ensure that each person has full control over how their activities and relationships are mapped, expressed, and revealed.

Ari didn't discuss specific timing, but I suspect that we'll see parts of Yahoo! Open rolling out over the next few months. I'm especially interested in seeing how Mail integration rolls out, especially the prospect of being able to implicitly map out my relationships. That's because I don't use Yahoo! Mail -- I use Gmail. Will Yahoo! enable me to reach into Gmail with its APIs and map out the relationships? I believe that they will -- after all, it behooves Yahoo! to bring me back into the Yahoo! network, even if I still keep my feet firmly planted in Gmail. 

The question inevitably arises -- is this a "Hail Mary pass" on the part of Yahoo! to fend off Microsoft? I think not. To Yahoo!'s credit, they have been focused -- as much as a company can be under the circumstances -- on executing on a strategy initiative that started last year. Regardless of how the Microsoft/Yahoo! dance turns out, Yahoo! will be setting a precedent for other portals and social networks to follow.

So it will be interesting to see how quickly the other players -- like Google, Microsoft, MySpace, and Facebook -- answer the challenge that Yahoo! has set down. I don't think it's a matter of if, but rather, a question of when.

I'd like to hear your thoughts about what a completely open, "social-ized" Yahoo! means to you. What experiences would you want? What concerns do you have?

Starbucks embraces customers' input

by Charlene Li

Today I tried out Starbucks' new customer feedback and idea generation site at mystarbucksidea.com, which is powered by Salesforce Idea (it's the same product that's behind Salesforce's own Idea Exchange and Dell's Ideastorm).  Josh and I feature these two sites in our Groundswell book, as an example of how a company can execute an "embracing" objective.

On these sites, people like you and me can "share" an idea. Then other people can "vote" for them, and the ideas with the most votes float to the top.  People can "discuss" an idea by adding comments, and  finally, to close the loop, Starbucks will provide feedback and status reports on the most promising ideas.

The results: Starbucks "launched" the site on March 19th. The top idea as of today is for Starbucks to offer a "punch card" to provide a frequency discount or free drinks. It has 29,410 points, which means that 2,914 people have voted for it (each vote counts as 10 points). The site's "Ideas In Action" section has a post (sorry, no permalink!) has an entry on March 24th saying that this particular idea is being reviewed and will be incorporated into the Starbucks Card Reward program.

The reason why I was so intrigued with the Starbucks site is that I'm a loyal user of Starbucks, so I have plenty of ideas on how they can improve their service. Just how much do I use Starbucks? It's my default place to work on weekends (the empty office is too depressing and having spouse/kids at home is a recipe for non-work) and my remote office when I'm traveling. As a result, I know where the electrical outlets are at all of my local Starbucks and bring along an extension cord. I also have a list of Starbucks stores bookmarked on my phone browser.

What's impressive is that I'm feeling more connected with other Starbucks fans, especially those craving healthier breakfasts, automatic ordering with my Starbucks card (mine is a simple Grande decaf), and my pet peeve, more power outlets.

But Starbucks, please don't let this engagement end! I want to subscribe to your Ideas in Action "blog" via RSS so that I can find out more about what's new -- and to see if my favorite ideas are being implemented. I want to comment on your blog too, to let me know that I'm happy/not happy about your future decisions. Close the loop, and you've not only got me hooked, but I'll walk the extra block in NYC or drive the extra mile to go to you rather than another coffee house.

Update: It hit me that I'd like to know your experience with Starbucks Ideas. What do you like/don't like about it, and more importantly, what brands/companies would you like to see adopt something similar? I'm curious to see if you would participate and contribute more to personal, consumer brands like Starbucks, or if there's also an affinity to business-oriented companies like Salesforce.

Purists and corporatists -- you respond

by Josh Bernoff

Thanks for all your responses on the scale I posted. Recall that 10 is an extreme purist (power to the people!) and 0 is an extreme corporatist (power to the corporation!). I saw people coming in all over the scale.

Here's what I learned:

1. Nobody likes to be pigeonholed. I loved this from frymaster.

When I'm drinking [which is most of the time], I'm a 10. When I'm at the client I'm a 5. Unless I had a little nip, and then I'm a 7.

 

I also enjoyed Mark's attempt to add a dimension. People just can't get comfortable living on a line segment.

2. A lot of people seemed comfortable in the 5 to 7 range (or couldn't tell my definitions of 5 and 7 apart). Here are the definitions again.

7 The groundswell is powerful, but companies have a role in it. Groups of people inside of enterprises can get together and make themselves heard. Even so, the groundswell will always prevail over their interests.

5 Companies belong in the groundswell. They have interests just as the people do. They will set up corporate efforts -- presences in places like Facebook or their own corporate blogs -- and connect with their customers. They can't shut down or co-opt people in the groundswell, but they can form meaningful relationships with them. And they can accomplish goals like marketing or collaborative innovation, if they respect that they're not in charge.

Given the fact that our active readers are probably the biggest believes in the power of social, this shows an amazing tolerance for corporations. Maybe because to make a living doing this stuff, you have to give the corporation a role. I'm quite happy myself at 5 and expect to sell a lot of books to others who are comfortable there.

3. I was intrigued by the perception that people were moving. I especially liked this comment:

The last number [average of businesspeople you meet] is the one I see movement in every day...one at a time I'm seeing people who used to be 2 or 3 become a 4 or 5.

So here's the interesting question. Is the business world slowly creeping towards the middle, or headed towards the purist end? Are we going to end up with a balance between enlightened corporations and powerful people, or are the people just going to overrun the corporations and take over? I think how you answer this says a lot about everything you do while working in the groundswell.

Buzzkill: People are not bees

by Josh Bernoff

(Cross-posted from our blog at harvardbusiness.org.)

People are not insects. So why is it so popular, in analyzing the surge of social activity online, to compare them to bees?

Here you see the covers of two recent books about social technologies, Barry Libert and Jon Spector's We Are Smarter Than Me and Larry Weber's Marketing to the Social Web. Both appear to be more hive than Web.

It doesn't stop there. Online contributions are typically referred to, in the aggregate, as buzz. There are dozens of companies in the buzz-monitoring business. Two of the prominent ones are Nielsen BuzzMetrics and BuzzLogic, which has got bees all over its site. Or, if you'd prefer to hire people to buzz about your product, you can always go to BzzAgents, which has got an angry (determined?) looking bee as its logo.

Language matters (see my rant against "users" which stirred up a hornet's nest . . . oops!). These books are pretty good and pretty interesting, and these companies are all successful at what they do. But from their covers and Web sites, you would think that all those contributors to the groundswell are diligent, interchangeable workers. This is the wrong image, folks. The groundswell is as heterogeneous as humanity itself. You're part of it. Are you an interchangeable part?

The fact is, the groundswell is made of people. Some of them are strident and vocal, some are quiet. Some like to gather in social networks, others in online forums. Their contributions are thoughtful, insipid, polemical, balanced, respectful, blasphemous, adoring, hateful, and any other adjective you can muster. You can use companies like BuzzMetrics to get a general idea of what's happening, or you can use companies like BuzzLogic and Visible Technologies to identify the influencers in your market, which could be far more important.

I think these bee images recur because they're easier to understand. Yeah, it's a lot of people out there contributing and interacting (We Are Smarter explicitly harks back to The Wisdom of Crowds in its marketing) but by thinking of them as bees in a hive, we become comfortable with their activity. Like all those busy little workers building Wikipedia. Ok, says the corporate strategist, I get that.

In fact, online activity is messy. It's characterized by flareups often driven by a single person with a creative idea, which never happens in beehives (lots of great instances are in Groundswell and in Citizen Marketers, for example). You can join it, influence it, deal with it, become a part of it. But no matter how much smoke you pump into it, it won't calm down as a beehive does. And that's because it's made of unique individuals, not worker bees.