RonAmok!

When I speak to business owners, the most common question that I field about New Media is: “But what about Return on Investment (ROI)?” The question is fair enough. If I, as a businessman and your New Media Evangelist, am “spreading the gospel” of New Media, I should be able to make a business case.  Right?

So let’s give it a try:

• If I spend $10,000 and get $11,000 back, then I have a return on my investment of 10%.
• Or, if I invest $100,000 into new software that saves me $40,000 per year, that investment will pay for itself in two and a half years.

Profit is a two variable equation. If I can increase revenues and/or reduce costs, then I have a positive Return on Investment.

But what happens if I invest $0 and get some sort of benefit from it? How do I then calculate ROI?  How does one divide by zero?

For example:

• I can download Wordpress and have a blog up and running on my own site — at no cost.
• I can use my little hand-held digital camera to record a video demo of my product, place it on YouTube, and pay zilch for every person who sees it.
• I can build a page on Facebook or Linked-in, connect with colleagues, get introduced to prospects, and get answers from trusted resources — for nadda.
• I can microblog on Twitter, breaking industry news, pointing customers to relevant information, or providing expertise to those who seek it — for scratch.
• I can take digital photographs at a trade show, load them onto Flickr, and share them with my favorite customers — for nil.
• And I can use RSS to keep me informed about my industry, my customers, and my finances — for bupkis.

Therefore, if I receive ANY increase in revenue or reduction in costs from my cashless investment in these technologies, whether it be a sale, a prospect to call on, or a piece of branding, the ROI is infinite.

The bean counter will quip, “But, Ron. Time is money.”

Yes it is. And that’s the basis of my argument. Management is about determining the proper use of corporate resources. Because New Media technologies offer such high (divide by zero) leverage, managers should at least consider if a small investment of time makes sense. The upside is too high to ignore.

Let’s take one example. I know a blogger who writes for a large corporation. He writes a blog post every other week. He’s told me that he spends, on average, two hours per post. After 6 months of blogging, he had built an audience of about 300 RSS subscribers.

Let’s say that the fully burdened cost of his position (salary, benefits, office, computer) is $200,000 per year. Rounding that number to $100 per hour (for a 40 hour week), the blogger’s employer is spending $200 every time delivers a message to 300 PRESENT subscribers.

But a blog isn’t a one shot deal like that of a marketing campaign, tradeshow booth, or corporate newsletter. A blog represents a growing repository of relevant content — a searchable database for both PRESENT and FUTURE readers. Today my example blogger has over 500 subscribers. With every additional subscriber, his cost per prospect/customer touch is shrinking, from $0.66 to $0.40.

That’s the investment. Now let’s look at possible returns. While gaining an audience, your corporate blogger is:

• establishing trust with a growing audience
• becoming a respected expert in your company’s field
• becoming sought-after resource as opposed to yet another person to be avoided

Therefore, what is the ROI if your blogger:

• is asked to speak at a major industry conference?
• accompanies your business development people on a sales call?
• spurs a customer to contact your company directly?
• can instantly respond to the fear, uncertainty and doubt (FUD) that your competitor is spreading about your company?

Are “returns” such as these worth prioritizing and “investment” of one hour per week? Are they worth 1/40th of your employee’s fully burdened cost?

Something to consider as you start your FY2009 planning?

Tags: ROI blogging new media evangelist ronamok ron ploof divide by zero infinity

For every fact there is an infinity of hypothesis.
The more you look the more you see. — Robert Pirsig

* * *

There’s a scene in Zen and the Art of Motorcycle Maintenance about a student with writer’s block. She wants to write a 500 word essay about the United States, but her teacher suggests that she narrow her focus. Instead of writing about an entire nation, he recommends that she write about something more specific– like her hometown of Bozeman, Montana.

She couldn’t do it.

So, he asked her to narrow her subject to Main Street in Bozeman.

She still couldn’t do it.

Frustrated, he said:

“Narrow it down to the front of one building on the main street of Bozeman. The Opera House. Start with the upper left-hand brick.”

And she returned with a five-thousand word essay.

* * *

I advise my corporate blogging clients to choose razor-thin topics. By carving out the narrowest of the narrow, a world of possibility opens, simultaneously making it easier to write for and attract a passionate audience. “If your corporate blog is a source of information that can’t be found anyplace else,” I tell them, “then you’re on the right track.”

Take Karen Bartleson over at Synopsys, for example. Karen is an electrical engineer who has been writing her corporate blog, The Standards Game, for almost a year. Her topic? Industry Standards in the field of Electronic Design Automation. You get that? She’s writing a blog on the trials and tribulations of pocket-protector-propeller-heads who are crafting mind-numbingly boring documents that explain how to get software products from fierce competitors to play nice with one other. Who would would read something so nanoscopic in nature?

Well, what if I told you that Karen has over 600 RSS subscribers? Put another way, over 600 people are so fascinated with what Karen has to say about something as geeky as Electronic Design Automation Standards, that they’ve demanded to be notified the instant she publishes something new? That, my friends, is called INFLUENCE.

If you’re a blogger who’s writing for your company, take a hint from Robert Pirsig. Write about a brick on a building on a street in your town. Learn from Karen Bartleson by choosing a topic that at first blush seems drier than Death Valley, but once you dig into it, you find a wellspring of stories. In both cases, those who are passionate about your topic will find you; they’ll tell like-minded friends, who in turn will subscribe to your valuable source of unique information.

And if you still don’t believe in the power of a nanoscoping, take a look at my good friend, Mr. B’s, online publication called Bacon Today. No joke! Mr. B runs an entire website dedicated to “Daily Updates on the World of Sweet, Sweet Bacon.”

For every fact there is an infinity of hypothesis.
The more you look the more you see.

How focussed is your topic?

Tags: bacon today build audience Karen Bartleson nanoscoping New Media Evangelist robert pirsig Ronamok Synopsys the standards game Zen and the art of motorcycle maintenence

Corporate video doesn’t need to be stiff. There’s nothing wrong with grabbing that Flip Camera and recording something that a traditional would never put on a corporate website.

The following example of online video fits that bill. Featuring Cadence blogger Bob Dwyer, the two minute video demonstrates an iPhone being used to run Cadence software remotely via VPN and VNC. Geeky? Yes. Impractical? Of course. But fun? You betcha! Better yet — Bob offers it as justification to get your boss to spring for an iPhone.

And for those non-electrical engineers out there, here’s some thoughts to explain how silly/fun the video is. The “First Encounter” software that he’s demonstrating is used by electrical engineers to place and route the guts of a chip — just like those that are found in your laptop or cell phone. Back at the office, it’s running on hardware that you can only dream of owning. And the cost of this software with all of the trimmings? Let’s just say that it’s closer to what you paid for your house than you did for that latest copy of Photoshop.

Tags: online video corporate video video cadence synopsys mentor magma ronamok New Media Evangelist eda