Aaron Kim, Emerging Technologies Evangelist with IBM Global Business Services talks about both sides of how companies are reacting to Web 2.0
In a session called “Realizing Business Value from Web 2.0: An IBMer’s Perspective on ROI, Metrics and Anti-Patterns” at the Web 2.0 Expo today in NYC with Aaron Kim, the topic was fear of Web 2.0.
The session focused on to “anti” patterns he’s observed in global enterprises that may explain why the benefits of Web 2.0 are not materializing fast enough for many companies.
While we find that many publishing companies haven’t even mastered Web 1.0, it’s important not to ignore something big that’s happening in the industry. Keep it on your radar. This session was great because it took a look at both sides of the spectrum, companies who don’t even want to talk about it, and ones that don’t think before they start building right away.
Being Hesitant: Fear 2.0
Why the bad solution (no innovation) looks attractive…
- Innovation and change are risky and scary, especially in larger companies
- Failure comes with a name tag – when you do something publicly, especially in Web 2.0 and especially if you’re a large company, everyone knows about it
Why it turns out to be bad…
- Not changing is riskier – waiting until what you think might be “the hype” is over, leaves you in the dust. Following the bandwagon too late leaves you with nothing original to add
- From distance, using Web 2.0 looks exactly like the introduction of email and instant messaging years ago
What positive patterns are applicable instead?
- Foster a culture of innovation that balances risk and rewards
- Fail quickly, fail cheaply, fail gracefully and learn from it
- Exit strategies must be an included in innovation initiatives
- Ultimately, taking full advantage of Web 2.0 may require Management 2.0” (Business Week, June 5, 2006)
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Being Overzealous: Rush 2.0
Why the bad solution (spend, build, spend) looks attractive…
- Web 2.0 sites occupy most of the top 50 sites in the world
- Your site/service is so cool and useful people won’t be able to resist it
Why it turns out to be bad…
- A fool with a tool is still a fool – Don’t start building and spending before you have a plan and research to back it. Be innovative, but don’t rush.
- People have a limited attention span – giving your users another social network to make a profile on isn’t appealing. Offering them a web application that gives them a tool they can use every day is.
- People behave in unexpected ways – unless you’ve taken the time to research what your users really want, you can’t be sure that throwing a web application or a social network at them is going to appeal to them.
- The world isn’t flat – thinking you can design or imitate someone else’s strategy might not work the way you think it will.
What positive patterns are applicable instead?
- “Web 2.0 is an attitude, not a technology” (Ian Davis)
- It’s about culture transformation, not a toolset
- Define and implement a comprehensive User Adoption plan
- Track adoption and balance incentives with desired outcomes
- Think about survival strategies: competition, predation, cooperation, and symbiosis
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Innovators vs. Bean Counters
Kim talked about ROI in Web 2.0, which was a popular topic at this conference. He followed the same path of most every other speaker I heard talk about it, and the path is this: Web 2.0 and social media is not always about immediate ROI.
For publishers, you’re likely not going to be building a stand-alone product like some other companies might do. More likely, you’re creating a brand-building tool or network for your users. The point is just that, “value capture takes time, effort, creativity and resources in short supply” Kim noted.
The value of many Web 2.0 tools should be obvious, because these tools create trust and loyalty to your brand which increases your SEO with link-building and product sales due to more personal relationships and customer satisfaction with your brand. But depending on what you’re building (or using), the value is either there or not there.
Your biggest metric, in a complimentary Web 2.0 or social media product should tell you how much you are getting in return for the amount you are spending. If you hired a social media community manager for 50k a year, that’s what you need to get in return. If you built a Web 2.0 photo community for your magazine for 10k, that’s what you need to make. If you started a Twitter account to generate traffic, you don’t need to get anything in return to see a benefit.
Kim showed a graph from the answers of 1,988 executives around the world from a survey question that asked, “What are the top 3 barriers, if any, to the further success of your Web 2.0 initiatives?” 28% said that they didn’t understand the potential of future financial returns. 25% by the way, said that nothing was holding them back.
When the question was asked about why they use it, 74% said it increased the efficiency of their business. In another question about why some companies were “holding out” on Web 2.0, 4% said it was because they “don’t see the need”. “How can you not see the need?” Kim asked.
But when Kim asked how companies were measuring the business value of its Web 2.0 deployment, 63% said they were using traditional measures such as ROI, total cost of ownership, or internal rate of return.
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More notes and quotes from the Web 2.0 Expo (and still more to be added so stay tuned):
7 Ways to Get Ranked in Google
Web 2.0 Supply & Demand Metrics
