How Much Whuffie Do You Have In The Bank?

November 24, 2009

Whuffie is a concept that was developed by Corey Doctorow is his sci-fi book Down and Out in the Magic Kingdom.  Doctorow created a world where the economy has grown beyond cash currency as we know it today.  Instead of money, the currency of his world is Whuffie, a “reputation currency”, similar to what we sometimes call social capital.  You earn Whuffie by being nice, helping people, and adding value by providing access to ideas, talent, and resources. I believe that, in the world of ecommerce, Whuffie drives business.

Down and Out in the Magic Kingdom by Cory DoctorowCharles Andres introduced me to this book in a comment on my blog last week.  The book is available as a free download or free podcast, costing only Whuffie.  You can also buy it in the traditional form from Amazon if you aren’t quite there yet.

Tara Hunt has built a following by developing a guidebook of how Whuffie applies to the world of social media marketing, called the The Whuffie Factor.   Tara breaks down the process of earning Whuffie into 5 basic steps.

  1. Stop talking and start listening to your customers.  (I might add that you must also prove to them that you are listening by providing feedback and adding value to their thoughts).
  2. Become part of the community that you serve.
  3. Create amazing customer experiences
  4. Embrace the Chaos!  Entropy is growing, so you better learn how to ride the chaos wave!
  5. Find your higher purpose.  Figure out how to give to the community and still be profitable.

The more I read about the Whuffie economy, the more I recognize that embodies the raison d’être for web-based marketing for ecommerce success.  Historically, retailers were successful by becoming an integral part of the local economy.  Merchants were known and trusted as part of their neighborhood, and merchandising was done to accent the best features of products for sale.  Whuffie was transparent: We knew the seller, we touched the product, and buying was a great experience.   Alternatively, if none of the above was true, say the store was run by a grumpy sales person that we didn’t trust, the business never survived.

The Grateful Dead foreverFor successful marketing online, the challenge, as we know, is how to scale that hands-on reputation and value beyond the local neighborhood.  The concept of Whuffie embodies this goal. Cory Doctorow gives away access to his books, making profit on his higher purpose of explaining his philosophy in live talks and future book sales.  The Grateful Dead figured this out long ago by listening to the fans’ desire to tape and trade their concerts (an amazing customer experience), thus creating a aura and community that has transcended well past the death of Jerry, selling more tickets and albums along the way, and spawning an entire genre of music (a higher purpose) that rides on the chaos of musical improvisation.

Traditional marketing and advertising can drive great short term results.  Well developed TV and radio, or paid placement ads, can drive short term business, and are valuable to jumpstart awareness of your brand.  But once you gain this awareness, the only sustainable way to keep it is to rapidly move to a Whuffie currency.  You need to think about how to engage that customer, add value, and keep them involved with your product.  In other words, scale with Whuffie.  Thus, the challenge becomes:

  • How do you listen to your customers, and encourage them to listen to you?
  • How do you engage them in a community which serves both you and their purpose?
  • How do you engage them to make them enjoy visiting and buying on your site?
  • How do you move that relationship to serve a higher purpose while earning profit?

The good news is that today, with Twitter, Facebook, and other social media forums, we now finally have the tools to implement these efforts.  We can talk and share with our customers and community.  But these tools do not replace or embody the underlying Whuffie, they’re just the checkbooks and credit cards of this new economy.  The Whuffie itself has to be earned, and that can only happen with hard work and genuine focus on your business.

The formula is simple… 5 easy steps described above. The tools are available, Twitter, Facebook, and other forums.  All you need is the awareness of your business’s value, the passion to involve your customer community, the dedication to make it work for you, and some serious investment of Whuffie to drive great sales results.


Putting Twitter in Perspective: Evolutionary Steps to Success

November 16, 2009

Ok, ok, so everyone says “you need to use Twitter to drive your business”.  But is it true?   I would vote for a resounding YES!  While it did take time to mature, today Twitter is an extremely valuable channel, when properly used, to drive visibility of your brand, your site, and increase your web-based business among the 32 million active tweeters.

Twitter has finally grown up.  It’s true that in its infancy, many people tweeted about inane things, such as where they drank their most recent cup of Starbucks.  We now must recognize that these were baby steps that marketers were taking to develop their “Twitter voice”, kind of like HAL singing “Daisy, Daisy, give my your answer do…”.  Unfortunately, there are still thousands of social media marketers who are still at this early phase.  Why?  Because to successfully leverage the Twitter channel requires the dedication of time and effort to mature and become a part, and ultimately a pillar, of the community.

Twitter Cartoon by Tony Gigov

Cartoon by Tony Gigov

You may have already learned that  maintaining a meaningful blog requires an investment of time and continuous focus on your core proposition. Twitter, with its limit of 140 characters per tweet, requires an even more focused strategy.  Unless you, (or a designated employee or writer) are prepared to dedicate a portion of your time each day to Twitter, your messages will quickly become lost in the noise.

So how should you drive this?

I believe there are 3 major evolutionary phases for effective use of Twitter for social networking:

1:  Ensure that your own understanding of your message is crystal clear, and use it to drive thought leadership.

Twitter, more than any other channel, requires a clear, defined marketing message. With so few words in each message, you need to make every tweet count.  What this message looks like depends on your business mission. For companies with defined products, your goal may be to share new ways that customers use your products.  With dynamic market driven products, such as tickets, Twitter can be used constructively to broadcast out the latest deals, or ski areas can use tweets to broadcast slope conditions.  For companies with less concrete product or service offerings, social networking may be best used to develop or elevate the recognition of your brand, both online and offline, or improve your credibility.  With your goal in mind, start the conversation by generating your own content that is focused on your customers’ needs.  Exhibit thought leadership that makes you unique. Learn what works! If you are new to social media marketing, I suggest you start with a blog, which still provides you with some editorial control. Begin commenting in other communities, such as forums, Digg and Yahoo Answers to develop your “voice”.  Once you are comfortable with blogging and commenting, then expand to Twitter to build your own community and following. Eventually you will  graduate to posting YouTube videos and using other channels as well.

2:  Listen to your customers, competitors, fans and detractors.

You should already be listening to your customers with tools like Google Alerts and other monitoring services.  Twitter is another place to hear their comments. Remember, good news travels fast, and bad news travels even faster.  Set up an alert, using a tool like Tweetdeck, to watch for mentions of your brand, so you can react very quickly with your new-found voice and clarify any misunderstandings, or fix any perception issues.

3: Communicate and Participate!

You are now a member of the community.  In addition to messages that you generate for your customer, like new deals, you will now have customers creating topics for you.  Embrace them!  When that happens, you’ve reached an important plateau.  Respond to your community’s needs, their concerns, and help them use your product or service better. Build on the good news, and clarify the bad news by asking for elaboration or encouraging their participation in a solution to the problems.  You now have a one-to-one relationship with customers who demand attention, backed by a whole universe who can see how well you handle their issues.

4: Be honest and sincere, and watch your community grow.

Credibility is key in social networking.  While you must avoid being pushy, you still have a right to promote your products.  People understand that you are in business to sell your products and services, and might find it odd if you don’t.  The key to success is working that fine line between promotion and a sales pitch.  As long as you truly believe that your product brings value to your customer (which we take as an assumption), then this should not be difficult for you.  Just keep that message clear, and you’ll find that neither you nor your customers will be forced into the idle discussion of your latest cup of Starbucks, nor will you ever regress to singing “Daisy Daisy” again.

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