September 1, 2014

What Pisses off the Man Who is the Face of 3D Printing

MakerBot, a manufacturer of desktop 3D printers priced at the level of a decent laptop, is the best known of companies producing a product that has already been raised to PC-level stature in terms of its potential impact on business and society.

Bre Pettis, the CEO of MakerBot, has become the face of this long-simmering but suddenly hot business (3D printers – the really expensive kind, anyway – have been around for decades) in part because he had lots of practice being a public face long before he ever thought about launching his company.

That background is why he was so pissed off at the recent Front End of Innovation conference, where he gave a speech about his approach to innovation.

What Caused the F-Bomb
Now, it’s important to put pissed off in proper context when talking about Pettis, who, when it comes to being the face of a new technology, hews much closer to Apple’s polite, tranquil (and nearly forgotten) co-founder Steve Wozniak than the other Steve. Besides some hair gel to sweep back a thick shock of salt-and-pepper hair and some long, hipsterish sideburns, Pettis wears the uniform of the typical sloppy, slack, sneakered, untucked anynerd and seems utterly comfortable in the skin beneath it.

That’s why when he uttered the F-bomb on stage (he apologized in advance) it came as a bit of a shock. He was talking about the US education system, saying that it is “f***ed.”

After his speech to the conference at large, Pettis held a Q&A in a small side vestibule where he was asked to explain what makes him so angry. Basically it’s the things we tamp down with Ritalin today: “We don’t let kids be playful, explore, or help them understand who they are,” he said.

A CEO Who Lived the Crisis in Education
Pettis is one of the few CEOs today who can speak about the education system from experience. He taught art in the early ’00s in a middle school in a poverty-stricken Seattle neighborhood. “If you are white you can basically skip school and not miss anything,” he says bitterly. “If you’re poor, you need the structure of the school system. About half the kids I taught got their breakfast through the school.”

With kids like these, many of whom lacked a consistent adult presence in their lives, Pettis discovered that using the medium that the kids were growing up with, video, was a good way to reach them. He did a series of videos of himself demonstrating how to make art projects and then had the eerie experience of playing the videos in class while standing next to the monitor. “They retained the information better when they watched the videos than they did when I taught in person,” he recalls.

Viral How-Tos
Not that Pettis was a bad teacher. Indeed, when he began uploading the videos to the internet (this was pre-YouTube days), they got tens of thousands of views. That led a publication called Make to approach him to make a series of weekly how-to videos for more pay than he was getting from the Seattle school system.

An obsessive, energetic tinkerer from an early age, Pettis couldn’t resist the offer. The connection with Make eventually led him east, where he co-founded NYC Resistor in a warehouse in Brooklyn so that people like him could get together and spend evenings cobbling weird stuff together.

From that base emerged MakerBot in 2009, which was co-founded by Pettis and two others. NYC Resistor is now housed in space upstairs from MakerBot’s Brooklyn factory.

Bringing Playfulness to Schools
As he demonstrated at the conference, Pettis hasn’t lost his passion for education. In 2013, the company launched a program called MakerBot Academy, in which teachers can request a 3D printer for their classrooms through DonorsChoose.org, a crowdfunding site for educators. Pettis pledged personally to supply every high school in Brooklyn with a printer, and has enlisted hackers on the company’s 3D print-plan community sharing Web site, Thingiverse, to develop a curriculum for teachers to download and plans for printing objects in the classroom. “I want to put a 3D printer in every school in the US so kids can feel empowered to create,” he said.

Of course, he wants those printers to be made by MakerBot, but what keeps his pledge from sounding like another one of those attempts to burnish the company image and revenues while doing good is the personal connection Pettis says he still has to teaching. “My skill is that I know how to gather people to do wonderful things,” he said. “I couldn’t be a CEO without having been a teacher first.”

When we think about the industrial supply chain, we can’t forget the resources that ultimately make it happen when they grow up: children.

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Is lead generation killing marketing?

What happens when you stake the value of your contribution to the company on something that you’ll never do as well as someone else?

This was the gist of a very controversial assertion made by a senior marketer from a very well known B2B technology company during dinner at our ITSMA Marketing Leadership Forum (download highlights from the ITSMA Marketing Leadership Forum) when he said: “An overemphasis on leads is damaging our relationship with sales.”

You could hear the proverbial pin drop in the room after he said it.

On the one hand, what he was saying seemed ludicrous. How could emphasizing leads not improve the relationship? The perceptions that marketers send nothing but junk leads to sales and fail to measure the impact of those leads on revenue have been hurting marketers’ relationships with salespeople—and the business—for at least a decade.

But his point was that marketers will never be as good at handling leads as salespeople are. In my research, I’ve never seen anyone claim that marketing contributes anywhere near 50% of the leads that turn into sales. Most anecdotal estimates I’ve heard range from 10-35%.

Now, you could argue that if marketers improved their ability to generate, nurture, and manage leads from start to finish that those numbers would improve.

But can we ever say that marketers will become the leading contributors of leads that wind up as closed business? Maybe if you’re selling Apple iPads, but if you’re selling complex B2B services and solutions? Seems doubtful.

Meanwhile, an overemphasis on leads causes salespeople to devalue the things that marketers really do best. The mysterious arts of reputation, idea marketing, segmentation, and value propositions move from mysterious to stupid in the eyes of salespeople if only viewed through the prism of leads.

In the current climate, the psychosis over leads to continuous pressure on marketers to provide more and better quality leads. The overall success of marketing is defined by increases in those two things.

But, argues this marketing leader, are we going to allow our success to be defined this way? If so, we will never win. Salespeople will never respect us because we will never contribute as much as they do.

While I don’t think we can just walk away from the lead problem and go back to designing logos, I do think we need to compartmentalize it a bit. We need to be measured on what we really do well—the creative, right-brained stuff. Here are some ideas for how to calm the battle over leads:

  • Create a lead system of record. The most contentious aspect of marketers’ contribution to revenue is that it can’t easily be measured. That means installing a system that can follow leads from the website to sales and back again. Marketers can send more leads to sales every year and still be seen as failing because they can’t track those leads. Other functions have systems of record. We need one, too. Within that system, we need to agree on ground rules for lead management—such as the definition of a qualified lead, lead scoring, etc. People respect rules more when they’re written in stone.
  • Agree on a realistic level of contribution. Most reasonable salespeople will agree that marketers can only do so much in terms of lead generation. Sure, the totals should go up each year, but the proportion of leads supplied by marketing can’t be expected to rise forever—otherwise, why do we need salespeople? Sales and marketing leaders should decide on a target goal of proportion of contribution and then get on with it.
  • Split the short term from the long term. It seems only fair that marketers should be judged more for their contribution to longer-term revenue—to the sales pipeline rather to sales themselves, in other words—than to short-term revenue goals. Most marketing leads are people who are not ready to buy. We need to make allowances for that.

We need to get past this battle over leads and get back to doing what we do best.

What do you think?

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Why Tut would have been buried with his iPhone

Sure, sure, I know it’s Apple and Apple is to the ’10s what Sony was to the ’80s. But there must be more to the fact that the iPhone/iTouch are the fastest growing technology launch in history (and the iPad so far is on pace to outdo them both).

Now of course you know that the iPhone and iPad are popular because of the way they look. The smooth contours and the shimmering black glass bezels make the devices look more like something out of a Swarovski store than a Best Buy. They bring out our primitive attractions to the bright and shiny. (For sure Tut would have shoved some of the gold trinkets aside to be buried with his iPhone and iPad.)

The default Home screen of the iPhone shows mo...
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But there’s something else here that brings out another primal drive in us. When you look at the screen of the iPhone or iPad you see beautiful little jewel-like icons beaming at you from beneath the glass. What I realized is that the iPhone and iPad aren’t just jewels, they are jewel cases. They contain our collection of applications. And these collections bring out our hunter gatherer instincts like any other collectable—from beanie babies to giant balls of string.

The reason is the iTunes/AppStore model. It lets us do everything that feels good about collecting:

  • Collecting is social. All collecting is driven in part by the desire to connect with others and show off and share what we have with them and talk about it all. Though iTunes could be a lot more social than it is, most applications have dozens or hundreds of reviews. The next step is to create communities around the applications so they can all geek out on it together.
  • Collecting is fun. Is there anything fun about collecting applications for your PC? Though the threat is much less than it was, installing new applications on PCs has always meant the possibility of taking down other applications or the computer itself. And the experience of finding and adding applications is almost always different from application to application. You can’t have fun when you’re anxious. Though the iTunes application store is tightly controlled—probably more tightly than it should be—it is easy and predictable.
  • Collecting is valuable. One of the most depressing aspects of PC applications is that they are basically time bombs that self-destruct with each passing generation of operating system or processor. Now, there’s no guarantee that our iPhone/iPad application collections will survive each new generation of device, but if they don’t, they’re cheap to replace. And in the meantime, they update themselves automatically. All we need to know when we’re collecting is that we’re not being idiots for investing our time in it (it’s okay to look like an idiot for what we collect—in fact, that’s part of the fun).

How to use iPhone apps for marketing
I’m not saying that the iPhone/iPad is going to take over the world, only that the model Apple has developed—and which every other phone manufacturers now trying to copy—is going to endure and will cross over into the business realm.

But as marketers, if we’re going to break into someone’s collection, the bar is set really high. Applications that convert your voice to text or instruct you on which turn to take are hard to top.

We must have the center of gravity for our mobile apps elsewhere. We need to create vibrant communities that customers will value so much that they will want a mobile application so they can keep up with the action anytime from anywhere. That’s how we get into their collections.

What do you think?

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Social media raises the bar for customer intimacy

Social media is raising the bar on customer intimacy.

Though it has become a generic term, customer intimacy was first coined by Michael Treacy and Fred Wiersema who worked at CSC/Index back in the 90s when I was a thought leadership marketer there. Rooted in Michael Porter’s timeless work in business strategy, Treacy and Wiersema took it a step further with their three “value disciplines.”

The theory is that every company competes in three disciplines:

  • Customer intimacy. These are companies that go out of their way to build close customer relationships. They are focused on lifetime customer value and are willing to incur short-term costs in order to build long-term loyalty and satisfaction—Nordstrom and Amex are a couple of B2C examples.
  • Operational excellence. Customers rely on these companies to deliver reliability and quality at a low price. FedEx is an example, having invented the guaranteed overnight shipping model.
  • Product leadership. These are companies that rely heavily on innovative, exciting, status-conferring new products to hold customer interest. Apple is the most obvious example here (Sony used to be).

Treacy and Wiersema argued that all great companies strive to be leaders in one of these disciplines while maintaining a reasonable level of parity with competitors on the other two. Though the theory was criticized at the time as being overly simplistic, it has held up remarkably well and continues to strike me with its simple (not simplistic) clarity.

Where’s the customer intimacy revolution?
You could argue that two of the three disciplines have already had their revolutions. The quality movement let most companies achieve a high level of reliability and consistency (for example, most car companies score very closely in quality rankings these days), and the venture capital movement (along with 3-D design software) has created a ready avenue for unknown product innovators to gain the spotlight.

Customer intimacy has remained the poor stepchild. There has been no revolution—no breakthrough in process or practice to raise all boats. Hard to manage and to scale, highly reliant on the vagaries of human nature, most companies continue to have poor relationships—or worse, no relationships—with their customers.

Social media is making that fact plain.

But you know, I’m tired of hearing people say we need to get closer to customers. Where’s the 21st-century revolution—the customer intimacy version of the quality movement—to show us how? We’re all struggling to move from the traditional arm’s-length, temporary campaigns to the always-on, direct relationships inherent in social media management.

The good news is that we may look back on social media as the movement that made high levels of customer intimacy as achievable as product quality seems today.

Intimacy through content
I think so because social media is starting to give us a way to scale intimacy. We can do it with content.

Social media reduces the incremental cost of content. We know that in B2B, customers and prospects respond best to ideas, news, research, and how-to—not sales pitches.

Social media is a channel for raising the level of intimacy that we have with customers and prospects with that content. Think of social media management as filling in the gaps. Chunks and snippets of white papers sprinkled through social media like breadcrumbs in the forest let us deliver value and build trust by providing content at a higher level of frequency. Social media that connects one live event with the next one lets us continue to build the relationship. Most of this is content we were going to produce anyway. Social media lets us spread out the cost while also increasing the frequency of touches.

Unspoken intimacy
We tend to think of intimacy as being personal—something for the salespeople. But we can do it by reliably delivering valuable content. Magazines have been doing it for years. Consistency, relevance, and quality create a very intimate relationship with readers. I will never forget the live encounters I have had with readers while attending trade shows when I was at CIO or my bike magazine—people I had never seen or spoken to before—who approached me to tell me how much they loved or hated my magazine without even introducing themselves. In their minds, they had already developed a deeply intimate relationship with the content that they associated me with, and they felt passionately enough to speak it to a complete stranger because I was associated with that content.

It was very easy to strike up a conversation with those people because we already had a lot in common. And I knew that I would probably never see or hear from many of them again because I didn’t have a channel for communicating with them directly once we parted ways—except through the articles I wrote and edited. Few people bothered to write letters to the editor, just as few people contribute to communities or post comments on blogs today. But that doesn’t mean that the intimacy isn’t there. Our intimacy exists mostly through the content—we just have to find ways to surface it.

Social media increases the frequency of those kinds of contacts. I can’t help but think that as the different social media channels continue to evolve, customer intimacy is going to take a leap forward.

What do you think? How should social media evolve to let us create customer intimacy more easily and economically?

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When does content need to be mobile?

We got a question this week from an ITSMA client asking about developing a business case for creating mobile applications for their website content. I said that I haven’t seen any of those business cases yet. And I don’t think I ever will.

We’re seeing mobile be part of an integrated approach to social media, not as a standalone. In fact, I’m working on two case studies this week of websites that have mobile applications, but the mobile applications are a small part of the whole. And they both lead to content that benefits from being mobile.

The attributes that seem to matter so far are:

Location. Could other users of the application get value from knowing where others are?

Continuity. Do they feel that they will miss something by being away from the content for even a short amount of time?

Timeliness. Will content appear in the application that needs to be acted upon immediately?

One company’s mobile application is tied to a wiki-based sales enablement website that lets salespeople generate actions and updates and get updated information from the road.

The other company has a mobile application for its private, gated online community so that mobile members can keep up with message boards and forums that change frequently (there are over 100 subject-oriented communities within the site).

Creating a mobile application that leads to static content on a website isn’t going to build much interest or loyalty because there’s no real urgency to connect. The only reason I can see for creating a mobile application in this context is if the application makes the content easier to look at and interact with than on a web browser. Apple claims the iPad will make content look better than it does on a web browser. If that’s true, then it will be worth making an application that connects to static content. But not until then.

What do you think?

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Apple's marketing arrogance

It’s marketing 101: don’t hold your needs above those of your customers—and don’t defy the expectations that you set with them.

Apple has violated both of those rules this week, and I’m sure they could care less—Apple long ago concluded that their products are so much better that customers will overlook the arrogance with which they treat customers. Here’s what happened: Those customers, (like me, ordering my first smart phone ever) who ordered an iPhone 3Gs over the web last week (Apple sent me an email inviting me to order—I didn’t pursue them) were promised that they would receive their phones “by June 19.”

So far, so good. But then Apple sent out confirmation emails to its customers listing a UPS tracking number link to track the progress of the shipment. I love the e-supply chain so I clicked to see UPS’s cool codes and see where they would ship the phone on the way to me (Anchorage, AK—how cool is that?). I was happily surprised when the manifest said I would receive it on June 17.

Then, this morning I saw the TechCrunch story about how Apple is having UPS hold the iPhones at the Louisville, KY hub until Friday—Apple’s official launch date. It makes sense when viewed from the Cupertino Ivory Tower: Why would Apple want customers to get the products they have purchased before we told the world they should have them?

But of course, true to Michael Porter and Michael Treacy and Fred Wiersema’s principle of business strategy: companies only do one thing really well while trying to maintain parity with competitors on the things they don’t. Apple creates great products. The rest? Meh. UPS delivers packages efficiently—it is all about operational efficiency and supply chain.

So you won’t be surprised to learn that UPS took those iPhones and delivered the heck out of them. While Apple, which is all about product, didn’t pay enough attention (as usual) to that part of the business. Which meant that after UPS announced delivery dates to its customers, Apple stepped in to put the brakes on—and ordered UPS to go slower.

Can you imagine the looks on the faces of the folks at UPS central in Louisville as the word spread that they had to mothball the phones for two days and not do what they do best—deliver packages fast?

And can you imagine the arrogance of marketers telling their customers that a launch date matters more than satisfying their needs? I can’t. Can you?

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Why I Don't Hate the Term "Cloud Computing"

I see now why they credit old people with having wisdom. If you hang around long enough, you begin to see patterns in the way the world works, mostly through sheer repetition.

I think I’ve been hanging around long enough—first as a technology journalist and now as an analyst—to explain why the concept of cloud computing seems to be gaining acceptance when other descriptions of the very same thing did not.

The evolution of the terminology for cloud computing mirrors what the best software developers are trying to do with computing in general: abstract away the complexity. The more you make the details of computing go away—at least for those of us who have to use the stuff rather than design it—the better off we all are.

Remember MS-DOS and the terror of the blinking C prompt? There wasn’t a day when I confronted that big, blank screen with that cursor blinking impatiently at me when I didn’t have at least a fleeting sensation that I had forgotten the secret code, that I would be struck numb, that the cursor would just keep blinking and blinking and blinking blinking and never stop. That a co-worker would happen by as I sat there staring into the black abyss and say what the aggro-geeks said about us users all the time back then: “Are you so freakin’ stoooopid that you can’t get past the C-prompt?!”

And then the question that allows people to pretend that they’re being helpful but which they know merely confirms your fecklessness and makes you feel like a five-year-old: “What is it that you are trying to do?”

How about kill the questioner?

We know what happened to the C-prompt. Apple killed it—or rather forced Microsoft to hide it. Today it’s like the monster behind a flimsy wooden door—you catch a terrifying glimpse every now and then and when the monster breaks down the door and the blue screen of death appears, well, you just have to run away.

But at least we don’t have to remember what MS-DOS means, or A: or B:, or C:. We have terminology for that now that abstracts away the complexity: Windows, folders, and of course “my computer.” I still feel like a five-year-old when I see “my computer” but at least I don’t have to rely as heavily on the deeply embedded memories in my basal ganglia when I start up my computer now.

But then things got complicated again. When we pulled computing out of the boxes and onto the network, we had client/server computing, which, in terms of terminology, was a lot like the C-prompt. It took many tries before you could absorb the difference between a client and a server—the forward slash alone was scary enough, like if you had to ask what the slash meant you were one of those stoooopid people who needed conjunctions. And the definition leaked like oil from an old British sports car. Did the client hold the entire application? Well sometimes, though usually just part of it. Did the server hold all the data? Sort of—eventually.

Then along came network computing. Ah, here was simplicity itself. The network is the computer. Just to prove it, Larry Ellison came out with a computer. But I thought you just said that… Makes you want sit on the floor and cry, doesn’t it?

To clear up the confusion, we gave up the metaphors and got back to our terminological roots (psychologists would use a slightly darker term: regression)—and came up with an acronym: ASP. An application service provider was someone who managed your applications and data for you.

But isn’t that what they used to call outsourcing? Well, not really, because they do it at their data center, not your data center. But wait a minute; don’t IBM and Accenture have their own data centers that they use to serve clients? Yes, but…

Clearly, what we needed to do in the aftermath of the ASP era was to think bigger. Metaphors weren’t the problem; it was that the metaphors weren’t big enough. We needed to go huge with this thing. So along comes IBM with on-demand computing. Computing was going to be like plugging a socket into the wall. Everything would just flow through the wire like power from the electric company. Except not for a while yet. For now, companies would continue to build their own data centers themselves, or have IBM build them for them, sort of like how companies used to build their own power generators, umm, before … we … had … power … utilities.

In a fit of candor, we then started talking about grid computing. Cause after all, that’s what this thing really was, a grid of computers linked together to create one huge, all-knowing, all-powerful computer somewhere. Except now you couldn’t do little things on the big computer. You had to do big things, like figure out the human genome. The way I understood grid computing, I assumed that eventually someone would come and take my computer and my Internet connection away. The grid couldn’t be wasted on people as dumb and lacking in ambition as me. I cried (again) when I heard about grid computing.

But now we’ve finally broken free with cloud computing. It isn’t just a big metaphor, it’s an infinite metaphor. It’s downright existential. Clouds are everywhere and nowhere, big and tiny—puffy white things from far away and microscopic droplets of water up close. Nothing says that computing happens somewhere else—but relax, it doesn’t matter where or how—as well as cloud computing.

If I were still a journalist, my life would be wonderful. I wouldn’t have to explain the cloud to my readers. There is no loophole in the definition that invites me to delve deeper to understand what it really means and determine whether it’s really a valid description of what’s going on here. The complexity has been completely abstracted away.

I know this all sounds cynical, but in the end it’s probably just as well that the cloud metaphor lets us off the hook of rigor. Like the DOS prompt, it’s not something most people need to know about.

It’s a lesson for all of us. Tech companies are complexity junkies, needing to explain and justify every detail until the marketing becomes as monstrous as the DOS prompt. We could all use a few more layers of abstraction—and some good metaphors—in our thinking and our communications.

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How Can B2B Use Apple's "Skim and Penetrate" Strategy?

Apple is on the verge of making real inroads into the business market, say analysts and academics in this Knowledge at Wharton article.

Yeah, we’ve heard this before.

But maybe this time it’s really going to happen. We’ve all heard about the encroaching consumerization of IT, as the lines between home and work blur and employees bring their applications from home—the most successful of which worship at Apple’s altar of intuitive interface design—into work with them.

Apple is riding this wave with its iPhone. As a marketer, you can’t help but wonder if there was a method to Apple’s madness of making the initial iPhone irresistible to consumers but nearly unusable for businesses. Think about it. Apple is nowhere in the enterprise today. Which do you think would work better as a strategy for breaking into that market:

1. Another cry wolf declaration from Apple that (yet again) it has a product that works as well for businesses as it does for consumers—which falls on deaf ears in the IT department, or

2. Optimize the product for consumer use and convert vice presidents of sales into frothing iTards who start peppering the CIO with emails about how great the phone is and demanding that they equip the sales force with a PDA (which the iPhone is, after all) that actually works and is easy to use.

A Wharton professor, Peter Fader, has anointed the latter as a bone fide strategy, calling it “skim and penetrate.” Here’s the core part of the article that you should memorize:

“Fader calls Apple’s approach a “skim and penetrate strategy” in which Apple “skims” a group of early consumer adopters—say CEOs enamored of a new gadget—and later hopes that these adopters will evangelize the product and help it reach broader adoption.”

My question for you is, how can this strategy work for B2B providers that have not burnished a shiny reputation with consumers? Strip Apple’s allure down to its essence and you get two things: ease of use and elegant design. Two attributes that haven’t exactly caught fire in B2B.

Okay, so consider the skim and penetrate part of this. How could B2B players get “consumers”—i.e. business people who matter–to evangelize your products to the organization? I’m going to get a little silly to jog your thinking. Could there be a “home” version of your software that’s free to use—and that may not even come close to mimicking its enterprise functionality. Indeed, it may have different function entirely, but simply introduces people to you and and your products?

In B2B, the attraction and evangelizing is reversed. IT falls in love with a B2B product and tries to sell it to the business. It’s usually a disaster, because what’s optimized for IT—I’ll categorize this loosely as rational appeal—rarely works for business people, who respond to emotional appeal: look, feel, application to their personal goals.

Yet what is optimized for the consumer can be made to work well for IT.

Is Apple on to something here that we have missed?

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