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Virtual Reality: IBM Embraces Web 2.0
January 25, 2007
By Maggie Rauch
IBM 9 opened in December as part of IBM's launch of a presence inside Second Life, a rapidly growing user-created virtual world that's enticing real-world corporations to set up shop: IBM's complex includes a Circuit City store, and Toyota and Starwood Hotels have, respectively, opened a virtual Scion dealership and launched a new, real-world hotel brand.
The head honcho at IBM 9 is Sandy Carter, IBM's vice president for SOA and WebSphere Marketing. In Second Life, her avatar goes by the name of SOAndy Starbrook. In the real world, she is one of IBM's leading innovators, test-driving marketing uses for Web 2.0 tools like blogs, wikis, viral video, social networking and RSS.
"You can reach so many more people than through traditional marketing," Carter says. In the past year, she has led three campaigns using emerging technologies. "It's also inexpensive, and it helps you break through the e-mail clutter because it's so cool."
A Brave New Web
The Internet is changing in a significant way—the hottest new applications and tools are characterized by their ability to allow users to actively program the Internet instead of passively consume it, and to link and network with their peers. This new iteration of the Web is commonly referred to as Web 2.0.
"The old Web was based on HTML [coding], which is a standard for the presentation of information," says Don Tapscott, author of Wikinomics: How Mass-Collaboration Changes Everything. "Now we have a new Web that's based on XML [coding] and the Internet is becoming a platform for programmability; it's becoming a giant global computer and every time somebody uses the Internet they're in effect programming it."
Business-to-consumer companies are already busy in this world. "American Idol" and Starbucks have profile pages on the social networking site MySpace, and Coca-Cola last summer created an ad just for YouTube. But social networks and viral video aren't just for beverage and entertainment companies—b-to-b marketers are tinkering in the space, too, and finding the new Internet an exciting, profitable place to cozy up to customers.
"A lot of b-to-c companies jump on this a lot faster and a lot stronger," Carter says. "We just presented at a marketing conference in Europe, and part of the attraction of our session was that we had done viral in a b-to-b setting. People wanted to know, is viral appropriate in b-to-b?"
Social Networking, B-to-B Style
At IBM, Carter has become an internal Web 2.0 guru, with her team's recent efforts adopted as companywide best practices. Carter knows what business leaders are increasingly understanding—that Web 2.0 is more than just a bunch of teenagers posting comments on each other's Facebook pages or tech-savvy nerds investing more energy into their Second Life than their real one. An increasingly diverse demographic is flocking to these applications, and also using them for business purposes. In a recent study, Alpharetta, Ga.–based Knowledge-Storm polled 5,300 IT professionals (mostly managers), and found that 76 percent share online video content with colleagues weekly or monthly. Among that group, 45 percent have a profile on at least one social networking site, and respondents rank business development as the top reason they use such sites.
"You see a lot of studies about blogs and podcasts as it relates to the broad consumer space, but not as much on b-to-b," says Matt Lohman, director of market research for KnowledgeStorm, an online search source for IT managers. Last fall, KnowledgeStorm conducted three surveys in conjunction with Universal-McCann: one on podcasts, one on blogs and RSS, and a third on online video, social networks and wikis. Together, the studies compose the Emerging Media Series. "We were interested in whether our clients should be using these tools. Results varied, and we'd like to think our buyers are a little more tech-savvy, but overwhelmingly we found usage was very high."
While KnowledgeStorm found evidence that most IT professionals use the emerging media that were studied, it found inconsistent results about the power of these outlets. "The influence of these formats varied significantly," Lohman says. "Part of the reason might be that there's still not a ton of content. Look at blogs: Eighty percent of our respondents say they read blogs, while just fifty-one percent say they're regularly reading them. Sixty-eight percent say there's not enough expert blogs on IT topics they're interested in." In Lohman's assessment, the demand for content represents a chance for businesses to reach IT decision makers as well as people in other business functions. "There's definitely a huge opportunity for marketers to create a meaningful relationship with customers."
Global executive search firm Christian & Timbers is so convinced of the staying power of marketing using the newest of new media, that it included "VP of marketing of social networking" on its list of 25 hot executive jobs.
"Eventually I think every company is going to have to do it," says Umesh Ramakrishnan, a Cleveland–based Christian & Timbers consultant. "While it's great to do one-to-one marketing, it is even better to get an aggregate of people who think alike. And the way to do that is through social networking."
Buzz-building
Early in 2006, Carter was charged with a challenge not uncommon at a technology giant like IBM: directing two launches in one year's time. The first was WebSphere Community Edition (CE), a free, open-source version of IBM's WebSphere Application Server.. The second was Service-Oriented Architecture, a new and more robust approach to enterprise-wide IT systems.
"As we looked at our market segmentation, we knew that thirty to sixty percent of the purchase decision is based on buzz," Carter says. She determined that the best way to create buzz was through viral marketing, and the best way to disseminate viral marketing was through the use of social networks. "We knew that would help us reach an audience we hadn't reached before and help us reach it in a very effective way," she says. "Using pre-existing social networks is very cost effective and it's more powerful than, say, third party advertising, because it generates an implied endorsement from a friend."
Carter created an "innovation council," charged with developing creative ideas for viral marketing initiatives. The group tackled WebSphere CE first, since the target audience of open-source developers—who collaborate to build and improve Web-based software—already had a strong and vibrant online network.
"We looked for the people we were after, and found that there were certain online communities where they clustered," Carter says. The most prominent of those communities was the Open Source Technology Group (OSTG), a network of Web sites with news, reviews, forums and product downloads for IT professionals, open-source programmers and other techies. OSTG's network includes Slashdot.org and Linux.com. By combining participation in that community with traditional ad buys, Carter's group managed to make WebSphere CE a leading download, surpassing its competitor JBoss.
The success of WebSphere CE efforts encouraged her to continue exploring. The team's next project was a product demo, posted on Yahoo! Video, which spent some time as the most-viewed bit in the science & technology category. "People really liked it," Carter says. "It was more infotainment than a sales or marketing pitch. So we said, 'Let's try a movie.'"
Making Movies
Late last summer, Carter turned to viral video to "launch" SOA. The goal was to generate interest and convert sales for IBM products. In 2005, Carter had used a more traditional approach to fill a similar need, inviting customers and prospects to a day of PowerPoint-filled demonstrations and lectures.
"People are really tired of seeing PowerPoint pitches," she says. Carter and the innovation council developed the novel idea of creating a movie—not a corporate lecture, but a film whose plot and characters represented features of SOA.
Carter looked into having the script written by a third party, but decided to form a team internally. "We had some who are creative and get concepts, and others who really know the product," she says. The diverse team collaborated on the script for Launch, a 30-minute drama. Raleigh, N.C.–based Centerline Productions produced the film and in September 2006, IBM began posting two-minute trailers on Yahoo! and Google's video-sharing platforms, as well as YouTube. The trailers included the address of a Web site where viewers could watch the full film once it went live Nov. 16, and watch a series of "behind the scenes" interview videos further explaining SOA.
IBM then invited customers and prospects to movie premieres in several cities, from Atlanta to Beijing. To carry through on the movie theme, IBM sent guests movie tickets, held the viewings in movie theaters instead of hotels, and served soda and popcorn.
The premiere events were a key part of the campaign, according to Carter: "The movie doesn't compel you to go out and make a purchase," she says. To convert viewers into prospects, she arranged for panel discussions after each of the theater viewings, featuring IBM executives, technical experts, vendor partners and customers. Panels were tailored to each audience that viewed the film, depending on what industry would be most represented.
"It was beneficial for us to be able to sit on that panel as the only business partner and talk about our experience, because customers were very interested," says Sean Jensen, sales director at Ft. Lauderdale–based Ultramatics, a WebSphere vendor partner. "It makes it a lot easier from a sales perspective."
The Launch endeavor generated a 20 percent increase in the opt-in rate for e-mails about her products, and generated tens of thousands of sales leads. "From the responses coming in, the new customers we've attracted, and the revenue we've already generated, I've over-exceeded everything else I've done this year with that one tactic by 10 times," Carter says. "I needed to be loud enough to break through what they were already hearing, and once they took notice of me, I needed to be able to turn that into the pipeline."
A key way that Carter feeds the pipeline is through her group's microsite, where users can read and comment on her blog, which is one of IBM's most-read. They also participate in wikis, or sites that can be easily edited by members of a group. "Web 2.0 techniques are critical here," said Carter, a.k.a. SOAndy Starbrook, in an interview inside Second Life. She explains that SOA works as a "LEGO block approach" to IT architecture, where interchangeable parts can be added, removed, improved and reused. IBM partners, independent software vendors and even some customers all compose an ecosystem that feeds SOA by exchanging new iterations of various services. And the best way to enable that degree of participation, Carter says, is through robust, interactive Web 2.0 tools.
A Little Laughter Goes a Long Way
IBM's mainframe division took a more grassroots approach to viral video. Tim Washer, who works in executive communications, had created humorous videos for mainframe's annual sales meeting in 2004 and 2005. Last summer, though, the mainframe group decided to post the newest videos on YouTube.
"We put it out just for fun; it wasn't really geared toward selling more units," Washer says. "We thought we'd just get some awareness for the mainframe." The videos feature Bob Hoey, international vice president of sales for the mainframe division, playing an asinine version of himself.
In "The Sales Lesson," shot in the documentary style of NBC's "The Office," Hoey trains and coaches two employees, who often look bewildered while absorbing their boss' mixed metaphors and enthusiastic blather. The salespeople then fumble their way through calls, trying to follow Hoey's advice and translate his metaphors into a sales pitch.
Amid the humor, the video sneaks in a subtle message. It touts the mainframe as an economic, energy-efficient choice, one that allows for superior IT security.
The video did manage to generate awareness; during the month after it was posted, visits to the group's Web site doubled and traffic on the mainframe blog grew by a factor of 10. By early January, the first video in "The Sales Lesson" series had been viewed more than 85,000 times.
"Bob has received e-mails from people who are interested in talking to him about the mainframe, who did not have one before," Washer says. "So this is having some impact on demand generation."
The Risks Involved
This type of marketing does pose some unique risks. In one well-known cautionary case study, General Motors rolled out a contest last spring inviting consumers to create Chevy Tahoe commercials. Using backgrounds and video clips provided by the automaker, some created "commercials" about the SUVs' lack of fuel efficiency.
Not all online-community participants welcome corporate activity, and they're not afraid to express their distaste. IBM's Carter says that at one point a YouTube user tagged the trailer for the Launch movie as porn. And some who viewed "The Sales Lesson" on YouTube posted negative comments about what one user calls "a covert advertisement."
Tim Washer says he expected that reaction, and prepped employees for it. "We knew we would get negative comments," he says. "But it's important that you don't censor the discussion. Otherwise you're just going to lose the audience over time. It's going to be controversial and that's just part of it."
"You're going to have to place your bets and try different things," Carter says. "If you have something that's either so valuable or fun or provocative, that someone will adopt that and send it to a friend, I think that helps to spread your message quickly and convincingly."
Sidebar: Community Builders: A Midwestern Software Company Creates Constant Customer Conversation
Executive search firm Christian & Timbers believes businesses will begin looking to hire marketers at the vice president level with knowledge of social networking and other Web 2.0 tools. For now, though, most companies experimenting with Web 2.0 utilize self-made, self-designated internal experts, creative minds who have stepped up and been embraced by a corporate culture that encourages innovation.
At TechSmith, an Okemos, Mich.–based manufacturer of screen-capture software, the Web 2.0 innovator is chief evangelist Betsy Weber. Weber's experimentation began in early 2005 with a blog; that has evolved into a strategy of using free Web 2.0 applications to maintain a running dialogue with customers.
"We would always get love letters from our customers," Weber says. "But now it's all about having conversations." TechSmith's top products, Camtasia and SnagIt, allow corporate trainers, artists, academics or bloggers to capture and record images and video from their desktop. Weber discovered they were posting their work on YouTube and on Flickr, a photo-sharing site that uses community tagging to archive images. Weber created a Flickr account and began posting her own photos.
"We wanted to share the faces of people who work at the company," she says. "I also travel a lot, so we started putting up photos of me attending trade shows. And I also use Flickr to show off our users. I'll post a photo, and say, 'Here I am with a user, and here's a link to his videos.'" She can also track the number of times people view each one of the images.
Weber and TechSmith also have pages on del.icio.us.com, a tool that lets users store and share their Internet bookmarks. Since del.icio.us allows users to link to one another's pages, a network of business associates also appear on her page.
Finally, in TechSmith's user forums, users help each other troubleshoot and find new uses for the company's software. Techsmith employees sometimes answer questions, but the forums are primarily a customer-run customer care center.
Sidebar: D.I.Y. Marketing: 4 Free Tools to Get You Started
RSS
RSS, or really simple syndication, is technology that allows users to subscribe to receive direct feeds from Web sites. Feed readers or aggregators such as Yahoo! and Google's customized home pages, or NewsGator Online, send updates when your selected sites put up new content, or when a news story or blog post includes one of your chosen keywords. RSS can be used to track your competition, stay current on industry news or protect your company brand.
Del.icio.us
Del.icio.us is a social bookmarking site that allows users to create a homepage for their favorite URLs, share them with others and find out what their peers bookmark. For on-the-go salespeople, it makes browsing easier, as they can find their sites from any computer. A salesperson could also use it as a customer service value-add by including links that are useful to clients.
Wikis
A wiki is a Web site that anyone, or anyone with a password, can easily edit. Its name is taken from the Hawaiian for "quick." Computer programmer Ward Cunningham invented wikis 10 years ago, but they have taken off with the growth of Wikipedia, an online, user-created encyclopedia, launched in 2001. You can create an internal wiki for your sales playbook, product development projects or corporate communications functions. Also consider letting customers in on the project—this kind of collaboration is becoming more common. Get started with a free download at Socialtext.com.
Flickr
Flickr is a photo-sharing site, a YouTube for shutterbugs. Starting an account is free, but you pay for more advanced features. Use it to document participation at an industry conference, post photos of client events or share the faces of your sales team. When customers come to see one photo, they can browse all of them.
Sales & Marketing Management Magazine
This article is brought to you by Sales & Marketing Management, the leading authority for executives in the sales and marketing field.
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