“Remember that an engaged customer is a highly valuable one.”  10 Ways to Measure Social Media Success
“Rushing into social-computing initiatives without clearly defined benefits for both the company and customer will be the biggest cause of failure…” Gartner Says Companies Need to Pursue Four Steps to Harness Social Computing in CRM

I’m hearing a lot of two extremes right now: social media is useless fluff, and social media is the magic bullet.  The truth is somewhere in the middle, and depends on your business, your industry, and your customers.

Put it into action today: Think about one thing you’d like for your audience to know about your company/product, and put it into a blog post, a tweet, or even one phone call to one person.

“What’s” are the specific things a business needs to accomplish, as opposed to the process they typically use to accomplish it. Some are high value; some are not. Understanding the difference can give you great insights into where you can safely pare away and where you should leave well enough alone.  A Better Way to Cut Costs

Put it into action today: Brainstorm the “what’s”.  Work with your team to figure where you’re creating value for your customers.  (Then go validate it through a quick and dirty survey)

“Stop looking at your member count to determine whether your community is successful, and don’t expect (or even ask for) rapid growth. Real relationships take time to develop, and if you want a real community based on real relationships, you need to be in it for the long haul.”  Member Count Not a Measure of Community Success

Put it into action today: Think of a question that you’re afraid to know the answer to, and ask it.  On your forum or blog would be great, but if you’re not ready for that, ask via private mail.  But take the first step towards ceding control.

” to a larger extent than you probably realize, your environment dictates your actions… So don’t fight yourself to change your behavior in the midst of the wrong environment; just change the environment.”  The Easiest Way to Change People’s Behavior

Put it into action today: Think about a result you want (a co-worker to stop doing something, a customer to start doing something, etc.) and brainstorm “How can I make it as easy as possible for this person to do this thing that I want?”

It could be asking a multiple-choice question instead of an open-ended one to your users (reduce their thinking time).  It could be proposing 6 meeting times instead of 2 to a customer (increases the odds that their calendar will be open for one).  It could be walking through a whiteboard exercise with someone instead of waiting for them to do it on their own (reduces their chance for procrastination, interactivity increases the odds of you getting exactly what you need.)

As a consumer, how could I complain?  It’s not hard to bookmark a half-dozen sites in order to get free access to incredibly useful tools like Tadalists, Posterous, Twitter, or Dropbox.

As a product manager, I think it’s a tempting way to paint your company into a corner.  I’ve talked before about always asking yourself “what’s the alternative to using our product?” Understanding that is a good way to understand the value you provide relative to the friction of asking consumers to change their behavior.   But on its own, it may paint too rosy a picture.

Let’s take the example of an online to-do list:

Alternatives: not making a list, writing lists on paper, entering tasks on online calendar or PDA

Friction: need to bookmark a site but setup and learning curve minimal

The alternatives are not that attractive (not making a list means I’ll forget things, writing lists on paper means I have to remember to carry that paper around and not lose it, entering tasks into an online calendar means putting personal stuff into Outlook or maintaining multiple online calendars…) and the friction is not very high.  This is a recipe for pretty decent consumer adoption!

That’s great, until either the alternatives or the friction level changes, and those two items are not entirely under your control.

Next week, a competitor to-do list product emerges with more robust features, or a snazzier UI, or even just better buzz than you.  Suddenly the alternatives include “use our competitor’s product”, and you have to lop a certain percentage of consumer adoption right off the top.

Or a sudden change at Google sinks your Adwords income dramatically.  Now you need to either sell more ads (negative user experience) or start charging and now your friction has gone way up.

How well-prepared you are to cope with one of these occurrences can be predicted in part by asking yourself another question:  “what would our users do if we disappeared tomorrow?”

In the to-do list case, I’d be disappointed.  And then I’d make my daily to-do list on paper and move on.  In contrast, my old company’s Yodlee MoneyCenter product would have a much more complicated extrication process.  I relied on “bill due soon” alerts to pay my bills on time, I stored username/password combinations to my financial sites, and I had years of transaction history.   Restoring the same level of service to my life would be a hassle – probably enough that I’d be willing to pay for a formerly free product in order to avoid that hassle.

The Yodlee product has plenty of flaws, but so do most of the products that I rely on.  The key is that they are solving big problems, things that I can’t as a consumer tackle on my own.  If I have a hangnail and a broken arm, and you offer me a flawless hangnail cure, I’m going to ignore you in favor of the company offering me a wooden splint.

Solve for the broken arm. Little problems are easier to identify if you’re not looking externally, and they make you feel confident: you can see the solution, there are few unknowns.  But talking to customers it’s hard not to hear what their “broken arm” problems are, and they’re generally pretty willing to ride out the unknowns with you.

Should applications look clean and professional?  Absolutely – things like good spacing and a consistent color palette helps you earn credibility with your audience.  Should text be legible and forms readable?  Absolutely again – visual cues must work with the kind of rapid ‘scanning’ that web users perform in order to speed processing time and reduce errors.  But beyond a minimum level of competence, design has to be treated like any other competitive advantage.  Will this drive more usage, more customer adoption, nudge my product towards being a de facto standard?

The answer is often “no”.

I can thank a certain large web portal for helping me to see that, several years ago.  I was working on a project that was already behind schedule, with a budget strained to capacity, and the main topic of hour-long conference calls would be adding gradient-fill backgrounds to the sidebar, or replacing the standard HTML form buttons with images that had rounded corners to match the Photoshop mocks that some visual designer had put together.

Turning Photoshop mocks into HTML code is a little bit like making sausage: you may like the result, but you don’t want to watch the process.  Having been fingers-deep in the process, I was forced to realize that the extra 20, 40, 60 hours that went into these “fit and finish” tweaks were basically an ego project.

Same thing with one of the other features that I consistently shot down with my last product: application “skins”.  Every few months, we’d get consumer requests for the ability to customize the look and feel of our web application.   Our design was flexible enough to work well in a variety of monitor resolutions, and browser text resizing worked – this was purely wanting to make the background green and the text pink (or whatever people do with skinning.)

Would rounded-corner buttons provide a slightly better experience?  Probably (assuming that accessibility concerns were addressed).  Would skins provide a slightly better experience?  Probably (to the people who bothered to use them; to the other 90% of users they might just add clutter and confusion).

Would either of these be significant enough to drive buying/usage decisions?  No way.

But clearly, sometimes better design and more choices do drive buying decisions:

One question to ask is “Do consumers use your product to define themselves?”

Can others see when your consumers are using your product?  Can consumers choose the way in which they display, wear, or consume your product?  Are consumers more likely to strike up a conversation in a coffee shop with a stranger because they’re both users of your product?

It’s easy to come up with physical product examples (like the iPod shuffle – Apple knows it is a personality-definer; that’s why they advertise them clipped to models’ clothing, already a part of them).

It’s harder to come up with online product examples, but here are a few:

• Email (in general).  No one wants a username like sanfran_cindy_2008@… and Yahoo! Mail knows it, so they recently bought some new domains to give users a chance at a shorter username.  Among the tech geeks, having your own domain name gives you much higher “geek cred”.
• Facebook applications. High school kids everywhere are FREAKING OUT about the proposed redesign because their profiles are such a significant part of their public persona
• Evite.  I’ve never gotten an Evite that looked completely generic/default.  Even the least “design-y” of my friends pick some sort of color and design scheme from the provided options.
• Flickr. Why is Flickr really the leader in photo sharing?  It’s certainly not the UI – I get lost between simple tasks all the time.  But the visual design does exactly what it’s supposed to – puts focus on the photos, not the other widgety things on the page.
• Mint. Mint’s gorgeous design takes an inherently geeky task – managing your money – and makes you feel cool for doing it.

If your product doesn’t have a lot in common with these examples, you may want to rethink offering it in six different colors or spending an extra two weeks of development on eye candy.   As much as it may pain your inner designer.

I’ve found that newer product managers often have a difficult time predicting consumer adoption for a new feature. It’s easy to overestimate the percentage of consumer adoption when you’re excited about a feature, and even asking the consumers isn’t always helpful. (When someone asks you “do you want X?”, and X is in the abstract, wouldn’t you say yes?)

I like to pose the framework of a friction coefficient. It looks like this:

Pain or Perceived Reward – Friction = % Adoption

To illustrate:

• Consumer is actively on fire (Pain = 100)
• You are handing him/her a turned-on hose with a big “FREE” sign on it (Friction = 0)
• = 100% adoption. Congratulations! 100% of on-fire consumers will accept your hose. (Start selling those garden hose ads.)

or:

• Consumer sees a $20 bill lying on the street (Perceived Reward = 100)
• There are no people, businesses, or homes in sight that it might have come from (Friction = 0)
• = 100% adoption. Congratulations! 100% of guilt-free consumers will take your money. (Go back in time to 1999 and start a dot-com company.)

Let’s take a real-world approach:

• Citibank offers consumers $150 to open a bank account (Perceived Reward = 80)
• Consumer must pay one bill per month for two months to get the money, and checking account fees are $6/month + is afraid that they will forget to close the account right away and rack up a couple more months of fees + assumes that they will rack up a couple of foreign bank ATM fees until they figure out where the Citibank ATMs are (Friction = 75)
• = 5% of consumers will open an account

(I have no idea what the actual adoption rates were for this campaign, but judging by the fact that this offer started at $50 and kept going up, I would guess 5% is, if anything, a generous estimate.)

Now, there’s obviously no science behind the 80 and 75 numbers – this still comes down to somewhat of an educated guess. But by thinking in terms of reward and friction, you can ask consumers more directed questions. You can ask on a scale of 1-10, how motivated consumers would be by $150. You can ask
on a scale of 1-10, how they would rate the effort of opening a new bank account. You can ask about satisfaction with their current bank. And you should always quietly add in a Friction of at least 20 to cover natural apathy.

The other reason this is useful is that you can try to move the bars. Let’s say you want to introduce some very slick AJAX functionality. You have to admit that your site is perfectly usable without it (low Perceived Reward). So you will need to make the Friction incredibly low in order to ensure a good level of adoption. Amazon did a great job of this with their inline 5-star rating UI.

Alternatively, you have a disruptive innovation that will require consumers to change their behavior (high Friction) – you’d better make it incredibly easy to see the value and ease the behavior transition. TiVo did this half-right – their original advertising did not communicate the value to me at all, but once I held that remote in my hand I was completely ready to buy the lifetime subscription and hand over my firstborn.