East Coast, West Coast Start-up Stereotypes

Shortly after I left Argyle, I emailed several professional friends and colleagues to share the news and to start having conversations about the next thing.  Most of the recipients were local, east coast friends.  A fair portion were west coast - either San Francisco or Silicon Valley.

The (overly-generalized) responses followed a theme:

East Coast:

• Are you OK? -Lots of people
• OMG - I can't imagine Argyle without you.  -CEO of SaaS start-up
• I'm sure it must be hard to leave your baby.  -VP at SaaS company

West Coast

• Congrats!  -CEO of marketing software start-up
• I'm jealous that you get to move on to something new!  -CEO of SaaS start-up
• Gotcha - call me later!  -CEO of SaaS start-up

The responses illustrated cultural stereotypes that I recently discussed with a west coast friend.  

Valley/San Francisco start-up people are transients - they bounce from thing to thing, companies come and go, people change jobs very frequently, everyone is searching for the big win.  The quick change game is so deeply embedded in the culture that no one is loyal to anything and people often abandon ideas too quickly in search of the next shiny object.

Small-market east cost start-up people - like in Durham, NC - take a more traditional view.  Fewer fundraising options and less experienced, more conservative investors leads to more bootstrapped companies, which leads to more early stage revenue.  So there are more very small successes that somehow manage to limp along or very small successes that never graduate from weekend/part-time hobby.  Entrepreneurs hang on longer, sometimes longer than they should.

These are obviously extreme stereotypes - the vast majority of people in the game fall somewhere in the middle.  But I suspect that you might be able to think of examples of each extreme...

Just Be Like Apple

Tom Webster published a typically brilliant post about business models and the dangers of the "just be like Apple" philosophy.  

I was in business school 2007 - 2009, Google was the undisputed online king and Facebook was just finding its footing.  Apple was on its way back but no where near the juggernaut it is today. 

Google sometimes came up as a teaching case study...and ALWAYS came up in the student commentary - "Well, at Google they do this..." "Google does 20% time..."  - particularly in innovation and entrepreneurship courses.

I certainly piped up with than my fair share of Google praise because I actually understood Google's business, which wasn't the norm in MBA classrooms in 2007.  

Most of my classmates didn't understand Google's business, but didn't let that stop them from jabbering about it.  It was annoying.

One of my profs finally forbade students from discussing Google, essentially pointing out that Google is a once-in-a-generation money-making machine the likes of which the world has never seen and that it is dangerous to think that all organizations should - let alone can - emulate Google's model.

So we stopped talking about Google.  And I was glad.

Epilogue

I was the only person in the Kenan-Flagler MBA Class of 2009 that showed up on campus with a Mac.  No joke.  I wrote a silly, whiny post about it.  

I'll bet you a dollar that there are way more Mac users than PC users in the MBA program today.  In fact, I'll bet you several dollars.

Turns out that the "Just Be Like Apple" strategy works pretty well if you've got Steve Jobs steering the ship.

​How To Start A Podcast: Behind the Scenes at Social Pros

I co-hosted my last episode of the Social Pros Podcast this week - at least my last episode as the official co-host.  My friend and co-host Jay Baer signed up a new batch of sponsors and I stepped aside to make room for the new headliners, though I hope to continue pitching in from time to time as a guest host, contributor, heckler, butt of Jay’s jokes, etc.

I’m proud of what Jay and I built - 54 episodes by my count.  Social Pros has played a leading role in sparking a renaissance of the podcast form - see The Work Talk Show, Human Business Way, SocializedBusiness, and others I’m sure.

In honor of the effort, here are some details about the work that went into building Social Pros:

The Backstory

Former Argyle Social COO Tristan Handy and I were looking for creative, counter-intuitive advertising outlets for Argyle and Tristan thought to advertise on a podcast based on previous podcast advertising successes he experienced at Squarespace.  We couldn’t find the right podcast to sponsor, so we figured we might as well just start the podcast.

We already had a sponsor relationship with Jay, so we pitched him on the idea.  It didn’t take long to sell him on the concept and thus Social Pros was born.

Narrow Focus

Social Pros works in part because it has such a narrow focus - real people doing real work in social media.  Instead of boiling the ocean, we set out to build a podcast about social media professionals for social media professionals.  The hyper-targeted vertical orientation created constraints that simplified programming, guests, marketing, and sponsorship.

Repeatable Format

Both Jay and I are super-busy, so we had to come up with a format that worked for the listener and didn’t require enormous prep.  We quickly iterated to find a formula that work:

• Brief intro and goofy banter about college basketball, parenting, or other silliness.
• Guest interviews - 20 minutes rapping with the guest.
• Stat of the Week - 5 minutes discussing a recent social study datapoint.
• Social Pros Shout Out - 5 minutes discussing unsung social/marketing heroes.

Jay usually prepped the guest interview, though I always had a question or two in reserve.  The Stat of the Week prep generally took 10 to 20 minutes, depending on how much digging I had to do in order to find a datapoint.  If often got suggestions from Jay and listeners.

I can’t remember who came up with the Shout Outs - probably me because of my history of “shout outs” with DJ Waldow - but it was definitely clever idea.  Social pros like to share insightful content and people, so we designed a podcast version of the “like” social gesture.  This is 5 minutes of content that we don’t have to create each week.

If you’re just getting a podcast off the ground, I suggest starting out with a simple, repeatable format.  The Social Pros format started out simple, evolved over time, and I'm certain will continue to evolve in the future.  

Audience Building

This was actually the easy part for us - Jay had already aggregated a massive, well-deserved audience and Argyle had accumulated a massive house email list.  So after a few quick emails/tweets and a handful of episodes, Social Pros had a significant following.

How do you build an audience for your podcast if you aren’t Jay Baer or Argyle?  No idea.  I guess you could ask Jay how he built his empire.  Or you could start a software company.

Guest Contributors

We aimed high when it came to guests.  And thanks in large part to Jay’s network, we bagged some great interviews - Jeremiah Owyang, Howard Lindzon, Scott Monty, Rand Fishkin, Tom Webster, DJ Waldow, and plenty of others.

The guests are important parts of the promotion equation, in part because there is a probably obvious quid pro quo.  Guests were eager to participate in our podcast to promote themselves, their book, their brand, whatever...and then would promote their participation in the podcast.  Definitely a virtuous cycle.

Production

We recorded every episode in one take, live via Skype.  The mixdown and post-production typically took 30 to 60 minutes.  Piece of cake.

So go start a podcast!

Massive Tech Incumbents & Social Media Services

Dell's social media listening service - which you can read about here - recently popped back on my radar.  (Dell actually announced the service in December.)  So I did a little digging / thinking purely out of curiosity.

Dell lists the social media listening amongst a panoply of other outsourced services - including insurance services and medical revenue cycle management services, all under the same business process outsourcing section of the site.  Nothing says smoking hot sexy market segment like the phrase "business process outsourcing".  

At first glance, it seems that social media doesn't belong - but it most certainly does.  The social media mechanics for large brands are enormously complex.  Responsiveness at scale requires sophisticated planning and systems - same thing for monitoring and mining the firehose for consumer insights.  Both are repeatable processes that a capable company can execute over and over regardless of brand, context, etc.  From this perspective, social media listening and payroll processing look surprisingly similar.

Dell's role as a "social media agency" is almost certainly predominantly reactive support-based and focused on business process, not creative, brand, marketing, etc.  I would be very surprised if the company staffed up the creative resources necessary to dream up and execute the next brilliant social media campaign.

Interestingly, Clemson University stands out as the non-big-business featured on the site.  It looks like the Dell/Radian6 relationship with Clemson is primarily for research and education.  Reading between the lines, I think that Dell helped Clemson build a social media command center and possibly provides ongoing related advisory services.

I suspect that the social offerings from massive tech incumbents in search of services revenue aren't a direct threat to the core business for top-tier social media marketing agencies.  But the new offerings will definitely compete for the same budget dollars and create strange market dynamics top-tier brands - Dell for social infrastructure and support, a social media agency for creative and campaigns, and a media agency for social ad buys.

Are We Close To Hitting Peak Social?

Social Pros Podcast #48 - the last episode of 2012 - features reknowned author, podcaster, speaker, and renaissance man CC Chapman.  The stat of the week comes from the Nielsen Social Media Report.

A few numbers to consider as you wind down 2012 and think about social media / marketing / business heading into 2013:

• In July 2011, there were 164M unique social media users in the United States.  In July 2012, there were 172M - that's a 5% increase in unqiues.
• In July 2011, US social media users spent 88B minutes on social media.  In July 2012, US social media users spent 121B minutes on Twitter, Facebook, YouTube, Pinterest, et al.  That's a 50% increase in usage minutes!
• For the quantitatively challenged - social user growth was slow and steady from 2011 to 2012, whereas social usage growth was crazy fast!

So what does this trend look like in 2013?  Have we hit Peak Social - the point at which the market reaches the maximum rate of activity and after which the rate of activity is expected to enter slow - eventually terminal - decline?

Some thoughts:

• I think that we'll see steady user growth - norming to slightly above population growth - as more youngsters give iPhones for Christmas and more Grandparents become interested in seeing grandbaby photos on Facebook.

• Barring the rise of another Pinterest, I think that usage growth will slow in 2013.  I don't think it will be flat - but I don't expect another 50% increase in minutes spent on social media.  In fact, I have a hunch that some of the usage growth might be "artificial".  In 2012, social platforms have gotten very good at activating users through email marketing and user experience.  So some of the "minutes" might be spent clicking a new follower email or interacting wit a weekly Pinterest digest.

• Jay made the great point on the show that approaching "Peak Social" might actually be a good thing for our business.  Instead selling a growth or momentum or "being the first brand on Pinterest" story, social pros will need to start thinking strategically about accomplishing business objectives using the available tools in their current state.

• These market dynamics - steady user growth, slowing activity growth - are also susceptible to platform dynamics.  For example - how will the continuing onslaught of social ads impact user activity?  Will consumer privacy concerns finally hit a tipping point in 2013?  Will a new Pinterest pop up in 2013 and suck attention away from the mainstream players?

Interesting questions and plenty of opportunity - so it's a good time to be in the social business.  Best wishes for a happy and productive 2013!

Social TV, Honey Boo Boo, And Other Nuggets From Nielsen's Social Media Report 2012

The most recent episode of the Social Pros Podcast features Erik Deckers of ProBlogService and No Bullshit Social Media fame.  It also features me in my pajamas.

The Stat of the Week turned into a winding conversation about some of the data points in Nielsen's recently released Social Media Report 2012.  The report is incredibly meaty and well worth 20-minutes of cursory reading...and probably another 60-minutes of close reading.  

One of the more fascinating datasets in the report relates to Social TV or - in layman's terms - Tweeting while watching Here Comes Honey Boo Boo.  Some of the highlights:

• 41% of tablet owners and 38% of smartphone owners use their device daily while in front of their TV.  Note that the report says in front of their TV instead of while watching TV.  Subtle but meaningful in my opinion.
• The report further breaks down specific activities by device.  For example, 45% of tablet users but only 22% of smartphone users report shopping while in front of the TV.
• Social TV is on the rise and not just during Presidential debates and Gossip Girl finales.  In June 2012, 33% of active Twitter users Tweeted about TV-related content, a 27% increase from 26% of active users in January.

My favorite social TV habits from 2012 include laughing hysterically at backchannel chatter during the Presidential debates and Tweeting cryptic minutia related to whatever basketball game I happen to be watching...err whatever basketball game happens to have on my TV screen while I'm in the room.

What are your Social TV habits?

"Hey", "Wow", and Other Brilliant Subject Lines

This week's Social Pros Social Media Stat of the Week is actually an email marketing stat.  I'm an old-school email marketer - as is Jay - so I just can't help myself.

Businessweek.com has a detailed piece about the Obama Campaign's email marketing strategy and operations.  I was astounded by the team's intellectually curious testing and ruthless, data-driven execution.  Some of the highlights:

• The campaign would test several email drafts and subject lines - often as many as 18 variations - before picking a winner to blast out to tens of millions of subscribers.
  

• The subject line  - “I will be outspent" - outperformed 17 other variants and raised $2.6M, according to testing data shared with Bloomberg Businessweek.

• Several effective strategies were counter-intuitive.  Dropping in mild profanity - such as the subject line “Hell yeah, I like Obamacare” - often drove big results.  Simple, ugly designs - plain text, garish colors - often out-performed perfectly styled emails.  

• Even in the face of ungodly email volume from the campaign, people didn't unsubscribe.  Best line of the article:  “The data didn’t show any negative consequences to sending more.”

So why are email marketing data points relevant to social media marketers?  In part because you never see articles like this written about social media marketing.

I don't think that it makes sense fo community managers to split test 18 versions of a tweet, but I do think it would be helpful to spend more time reflecting on previous campaigns - successful and less-than-successful - to seek out patterns and datapoints to inform future efforts.

A well-managed email marketing program can be an amazing conversion tool.  A well-managed social marketing program can be an amazing retention and amplification tool.  Both require discipline, data, and craftsmanship.

Social Media & E-Commerce: Why Can't You Two Get Along?

I record the Social Pros Podcast every week with digital marketing impresario and Indiana Hoosiers bandwagon fan Jay Baer.  Each episode, we discuss a "Stat of the Week".  If I can get my act together, I'll start sharing thoughts on each week's stat.

Though my Black Friday tradition is firing up the chainsaw and cutting firewood with my dad and brother, I recognize that shopping is the official national Black Friday pasttime for most.  So we discussed some recent data from IBM in this week's episode.

On Black Friday:  Shoppers referred from Social Networks such as Facebook,Twitter, LinkedIn and YouTube generated .34 percent of all online sales on Black Friday, a decrease of more than 35 percent from 2011.  

Source:  http://www-01.ibm.com/software/marketing-solutions/benchmark-reports/black-friday-2012.html

0.34% a minuscule number!  And it's decreased from last year!  So if you're a community manager for a brick and mortar retailer, you might want to let the panic ensue.  

Or you may choose to rationalize the numbers by suggesting that Black Friday is all about in-store transactions.  In which case, the Cyber Monday data should tell a different story.

But it doesn't.

On Cyber Monday:  Shoppers referred from Social Networks such as Facebook, Twitter, LinkedIn and YouTube generated 0.41 percent of all online sales on Cyber Monday, a decrease of more than 26 percent from 2011.  

Source:  http://www-03.ibm.com/press/us/en/pressrelease/39543.wss

Surprisingly - the data from IBM is light on details.  (Or maybe I just didn't dig deep enough.)  So there may be some methodology-based explanation behind the numbers.

That said - it might be the case that social platforms just aren't good channels for retailers.  Despite the emerging hyper-targeting capabilities, real-time social channels aren't email marketing light.  Conversion-oriented marketing and messaging doesn't resonate on social and there are plenty of studies that prove.  Forrester and GSI Commerce recently analyzed 77,000 transactions and found that less than 1% of transactions for new and repeat customers can be traced back to social links.

That's not to say that all hope is lost for retailers - social platforms are great for building customer relationships and developing customer loyalty.  

I think that the static in these numbers stems from misalignment in the channel and the quantification.  Relationship building is a mid-funnel - post-funnel in some cases - activity.  IBM is using a late-funnel metric to quantify activities from a mid-funnel channel.  And the numbers don't add up.

I'm a Free Agent

Argyle Social and I recently parted ways.

I've emailed a number of my friends and colleagues about the change, plus it has popped up in the local tech press - so I figure I may as well publicly comment.  

The context of the situation is confidential, but I'll share some personal, non-confidential thoughts at some point in the near future.  

I remain on good terms with the company,  the team, and the investors.  And I remain a sizable Argyle shareholder, so of course I wish the company nothing but continued success!

I'm taking some time off in Nov/Dec to spend time with my son Thomas (read: to give my wife some time off from our son) and to catch up on projects around the house.  I'm currently deciding if I'd rather re-do a bathroom or refinish the upstairs hardwoods.  Or I might just read Hand, Hand, Fingers, Thumb to Thomas another 3,000 times.

As far as what comes next - I'm not exactly sure and that's fine.  I'm enjoying the time off and doing 2 or 3 meet-ups / calls a day to catch up with colleagues and to learn what's out there.

Send me an email at eric at ericboggs.com if you'd like to have a chat.

On Removing Distractions

We've made some moves at Argyle over the past several weeks in the name of removing distractions.  Which is another way of saying that we've made certain decisions in an effort to focus on the most important thing.

Turns out this is really hard to do.  

First, you have to clearly define the most important thing.  This can be scary when you're a start-up in a dynamic market.  Defining the most important thing requires ignoring other opportunities, which can be nerve wracking and can spawn second-guessing.

Then you have to know how to pursue the most important thing, which is a function of the clarity of the definition and your team.  One can set a context and define a priority, but the method of pursuit is often best defined by the team that will do the work.

Then you have to actually pursue it in the face of 10,000 distractions - internal, external, personal, and otherwise.  I think that this is the hardest part.  It is so much easier to just react to whatever drops into your lap.

I think the framework holds up, but I don't feel like I'm doing a very good job of executing it.  Though I think that it is a process and a skill that I can improve over time.

Bill Friday and the Rhyne Family

My cousin Sylvia Hatchell - head coach of the UNC women's basketball team - wrote a great piece about Bill Friday, my late grandmother Catherine Rhyne Boggs, and my hometown - Dallas, North Carolina:

http://www.dailytarheel.com/article/2012/10/a-unc-basketball-coachs-respect-connection-and-relationship-with-bill-friday

Telling the Truth in Advance

A VC that I've gotten to know over the past couple years once told me that the biggest difference between Silicon Valley and everywhere else is that people in the Valley are more comfortable with and much better at "telling the truth in advance".

Fast forward to a few weeks ago.  I attended Dreamforce in San Francisco.  Salesforce announced  - with great fanfare - a cool product called "social keys" that seems extremely applicable to what we're doing at Argyle.  So I made a note to follow up on it when I got back in the office.

I read the social keys announcement blog post today and noticed this nugget at the very bottom of the post:

Currently scheduled to be available in the second half of 2013.

Guess you can do this when you're Salesforce.

Southern Documentary Fund

I recently joined the Board of Directors for the Southern Documentary Fund.  

SDF's mission is to cultivate and preserve stories made in and about the South.  Over the past ten years, the organization has nurtured over a hundred projects - documentary films, radio programs, and photography.  SDF-support projects have screened at international film festivals, won critical acclaim, and garnered countless awards - including an Oscar shortlist designation.

As you might expect from an organization largely driven by documentary film, SDF has a very cool trailer:

I'm happy to be a part of the organization and look forward to many good things to come.

How To Email A Busy Person

Everyone is busy.  

I thought I was busy while working at Bronto...and then I thought I was busy while at MBA student at UNC Kenan-Flagler.

Then Adam and I started Argyle...and then Kelly and I had a baby.  And a few weeks ago, we bought a 1957 fixer-upper house in Durham.  

So I've got a lot going on these days - enough to truly qualify as "busy".

And I get more email than I can possibly process - a fair amount of which includes pitches, introductions, and solicitations to "pick my brain".  In part to be somewhat less irritating than the people that often email me and in part to save myself some time, I'm trying to build new email habits:

- I often include the entire message in the subject line, noting "EOM" in the subject line.  The recipient can process what I'm saying without even opening the message. 

- I often begin emails with "No need to reply to this message".  The recipient can read without having the pressure to chime in or actually process the thought.  

- I sometimes send emails to process and clarify my own thoughts - I ALWAYS pre-empt these emails with a "no reply necessary" blurb.

- Unless I solicited the intro, I ignore intro emails until the other half of the intro responds to me.

- I ruthlessly archive without reading.  And I respond with a quick "no" more often than comes naturally.

- I write short sentences/paragraphs and use bullet points.  Note this blog post.

Additional thoughts from the comments and Twitter:
------ 

- I use Twitter.  ~Erika @ Start-Up America.

- I add my standard mobile signature to a short note if I want to be brief without appearing rude.  ~Doug @ Twitter.

Email Marketing Tips For Start-Ups

Argyle is a social media marketing start-up and we're obviously big believers in the power of social as a marketing channel.  But we're also old school in the sense that we invest very heavily in email marketing.

I was employee #1 at an email marketing start-up earlier in my career.  I spent four years with the company and learned a thing or two about email marketing along the way.

Here are a few email marketing tips to keep in mind for your early-stage company:

Email Early, Email Often.  At Argyle, our email list was most important marketing asset for the first year.  (Our Twitter following is quickly catching up today.)  We collected addresses at every customer touchpoint and sent very frequent emails - usually weekly.  We fired out a message every time we had something remotely interesting to say - new product features, new blog post, whatever.  Momentum is important early on, so any glimmer of hope is worth celebrating and sharing.

Be Entertaining.  Our product was pretty weak for the first year, so we had to manufacture reasons for people to like us.  So I resorted to entertainment.  Our early emails had subject lines like "Hold On To Your Butts" and pictures from awkwardfamilyphotos.com to illustrate new features.  It was all about getting attention, sharing our personality, and making friends.  

Invest In Automation.  We used MailChimp for a long time because it is by far the best bang for the buck - great features and a strong API for peanuts.  And we hacked together some very basic hooks into Salesforce and a few auto-responders.  As soon as we had a full-time marketer and a few sales guys, we dumped MailChimp and moved our email marketing (and landing pages) to Pardot - a very specialized B2B marketing automation platform that integrates deeply with Salesforce.com.  (We also gave very strong consideration to Marketo - it is more powerful, but also more expensive.)  Today our email marketing programs are incredibly complex.

Email Like An Executive.  It is obvious that you should use email to keep in touch with your customers.  It is less obvious that you should use email to keep in touch with prospective investors, prospective partners, and strategic prospects.  I have a couple email lists that I email ~monthly with company updates and strategic content.  I do it all through Pardot and track the responses very carefully - just like we track our customer marketing emails.

Regarding Competitive Misinformation

This has become an increasingly common marketing interaction:

• A prospect tweets about their experience evaluating Argyle.  Or a blogger mentions Argyle in a post.
• A competitor swoops into the conversation saying "Hey - you should check out our product!".

I don't have a problem with this whatsoever.  Social is an amazing competitve equalizer.  There are no protected markets - most customers are highly visible and often talking about their business problems and buying process.  At any given time, it is pretty easy to track down someone that is evaluating one of our competitors or one of our customers talking about Argyle.

However, stuff like this crosses the line:
 

(Sendible is a tangential competitor to Argyle based in the UK.)

As the CEO at Argyle, I have unique insight into the claim that "lots of users" are leaving Argyle for Sendible.  Turns out that this claim is false. 

We are building *very* aggressive customer acquisition machine at Argyle.  We win business with great products that solve meaningful problems and a transparent, consultative, and affable sales team.  While we're happy to highlight differences between Argyle and other offerings, we never disparage or flat-out lie about our competitors.

We're overly transparent because it is good business and the right thing to do.  And because the market is always watching.

A Story About Durham

This post was originally published at TriangleStartUpFactory.com.

--
I first visited Downtown Durham to take a tour of the American Tobacco Campus, which was still very much a work in progress at the time.  It was 2005 I think.  There was an 8 foot barbed wire fence around the property and there were trees growing inside of the buildings.  I was a Sales Associate at Bronto Software, which had 7 or 8 employees at the time.  Bronto moved to the American Tobacco several months after my tour of the campus yet-to-be and my love affair with Downtown Durham was born.

In December 2009, when my business partner Adam Covati and I pinched our respective noses and decided to take the plunge with Argyle, we knew that we wanted to move into a Durham office as quickly as possible.  After several months working anonymously in our respective home offices, we developed enough traction and raised enough money to move into a tiny office in the Snow Building at 331 W. Main St, right above Beyu Caffe.

I knew that we made the right decision the day we moved in.  Adam and I were struggling to move a couch (that we bought from UNC surplus for $20) into our building and Jud Bowman, the Founder and CEO at Appia and Durham start-up veteran, happened to walk by and hold the door for us.  We were bumping into guys like us on the street before we had even moved into our office.

Fast forward to today - Argyle has 21 employees and has carved out its own niche in Durham on Rigsbee Avenue, right around the corner from Rue Cler.  The city is our 22nd employee.  It helps us recruit, it keeps us entertained, and it inspires us to keep looking forward.

Durham is a momentum story - the culinary, artistic, and (of course!) start-up scenes have grown by leaps and bounds over the past several years.  There is a palpable sense of forward movement in Downtown Durham that makes it a great place to launch and grow a start-up.  I'm excited to see Triangle Start-Up Factory accelerate more good things in the Bull City.

Why Pay Sales Commissions?

Adam linked to a thoughtful article written by Fog Creek Software that described its rationale for switching to non-commission-based comp plans for its sales team.  The article spurred some interesting thoughts as well as a burst of tweets from some developer friends and colleagues - presumably because the article reflects a developer perspective.

So I thought I would jot down some notes for posterity.

In short - different jobs require different skills that require different incentives. Selling and coding are incredibly different tasks and thus shouldn't be comped the same.

For our purpose at Argyle, sales reps execute a process over and over. Unit-based incentives work incredibly well for these tasks.  The best sales people are coin operated - if you create a properly aligned commission plan, they'll do exactly the things that earn them the most money...which are hopefully the things that create value for the company.

Software developers solve complex problems over time.  Unit incentives are demotivating when tied to these tasks.  Check out this great talk from Dan Pink about the surprising impact that incentives can have on motivation.

A commission-less sales comp plan doesn't take away any of the realties of the sales role.  There is still a quota and intense pressure to hit it.  Just without the upside for performance beyond quota.

When done well, sales commission compensation rocks.  I loved getting it as a sales rep.  And I LOVE paying it as a CEO.  I'll write another post about how we've evolved our commission plan over time at Argyle.

2011's Greatest Hits

These are my favorite tunes from 2011.  And this is the obligatory tip of the hat to Chaz Felix for introducing me to the "annual greatest hits" format many years ago.

2007 Edition
2008 Edition
2009 Edition
2010 Edition

Interestingly, all of the following links point to Spotify whereas the previous editions pointed to YouTube, Amazon, iTunes, and elsewhere.  Spotify definitely changed the way I jammed in 2011.

Other than Big Boi (AKA Sir Lucious Left Foot AKA Daddy Fat Sacks AKA Chico Dusty) in January, I can't remember going to a single concert in 2011.  You see!  This is what happens!  This is what happens when you run a start-up and have a kid!

How Far We've Come - Dawes

Such a fun, bouncy tune!  A friend recommended Dawes to me and I listened to the record non-stop for several weeks.

Who? - The Sheepdogs

This would be a fun song to cover.  Very cool harmonies and a hard-hitting bridge.  Evidently the Sheepdogs are kind of a big deal.

Less of Me - Glen Campbell

I read an article about Glen Campbell's struggle with Alzheimer's and the record that he released - "Ghost on the Canvas" - as a goodbye note of sorts.  So I decided that I would like Glen Campbell.  And it didn't take very long. This song is particularly special because I like to sing it to Thomas.

Piggy Jig - Kindermusick

Speaking of Thomas - I have a kid now.  Which means I have to listen to songs like this.  Piggy Jig is actually pretty cool.  Could be a lot worse...and I suspect that it will be sooner rather than later.

Black Tongue - Mastodon

I have a kid, but I still like to kick @ss.

Whole Love - Wilco

At this point, Wilco is like a worn-out pair of shoes that fit familiarly and perfectly every time.  I thought "The Whole Love" was a strong effort.

Fanfare for the Common Man - Copland

I remember blasting this jam in January when we would close a deal at Argyle HQ #1, 331 W Main St, Suite 403, Durham.  We weren't closing many customers earlier this year, so it was always a big deal when we got one!  Luckily, we're closing much more business these days.  And we have way too many employees to distract with deafening Copland.

Judas - Gaga

Not ashamed that I love this song, even though many Argylers made fun of me for listening to it so frequently after it released.

Tracking Churn Versus Froth

This weekend, Kelly, Thomas, and I had brunch with some of the very smart guys at Shoeboxed.  Much of the conversation centered about best practices for measuring customer retention, as all great brunch conversations do.  Which lead to some interesting ideas around tracking churn versus tracking froth.

Delineating between churn and froth makes it easier to more accurately pinpoint and address the reasons behind lost customers.  Churn represents customers that cancel their subscription 3 months (or more) after signing up.  Froth represents customers that cancel their subscription within 3 months of signing up.  These are simple definitions, there are many other ways to define the metrics.

A high churn rate more likely indicates a product problem.  Churned customers bought into the value prop and stuck around, but didn't get long term value from your product.  This might suggest that certain features might be lacking or that the scope of your product is too broad.

A high froth rate more likely indicates a marketing problem or, to a lesser extent, an on-boarding problem.  Your marketing programs might be generating leads outside of your sweet spot.  Or your sales team may not be properly qualifying opportunities.  Or your services programs might be under-resourced such that new customers don't get the proper resources/training to ensure that they properly use your product from the outset. 

Both metrics are important and inform different strategic decisions for SaaS companies.  Identifying the characteristics of churny and frothy customers and pro-actively addressing the issues will pay off in the long term.