Get Social

Every Wednesday I leave work at 4:30pm to go to school (I’m going for my MBA at Rutgers). When I get there, the first thing I do is get my $4 latte. Sometimes I stop by a different Starbucks on a major highway on my way to work. When I look around, people are hosting job interviews and business meetings in the seating area of the store. For years, my wife and I have frequented the Starbucks counters that are inside Barnes & Noble stores for a coffee after a dinner out (which was the case this evening). When I look around, people are reading, working on their laptops, or just enjoying conversations together while sipping their lattes.

The point is that Starbucks has found a way to make itself part of people’s lives, and has done so successfully for years. These days however, Starbucks is facing a recession, new competition, and the loss of customers. But not to worry, I have an idea: Starbucks should focus on making themselves part of the online lives of their customers, particularly in a social way.

Starbucks could build applications that enable users to publicize their favorite Starbucks drinks to their friends, to rate drinks (existing and new), or even to send their friends a latte, virtual or real. They could tie their social application to a Starbucks loyalty card…I can foresee a ‘buy five, give one’ type of program that could potentially bring new customers into the store, or into Starbucks’ social network. And these applications are just the tip of the iceberg. Regardless, Starbucks could increase customer engagement with the brand, tap into the viral nature of social networking to attract new customers, and increase brand loyalty by providing a high quality, fun online experience to its customers and their friends. Oh, and let’s not forget, such a solution would be yet another valuable channel for market research.

Starbucks is a very, very strong brand. Everyone knows Starbucks, and they know what they stand for. Therefore, Starbucks shouldn’t settle for a social networking solution that lives behind someone else’s branded look and feel, such as Facebook or MySpace. Nor should they have to invest millions of dollars for a consulting company to build a custom social networking solution on their behalf. Ringside Networks has already provided a starting point, and better yet, the software is free. For little expense (maybe 1-3 consultants) and in a short period of time, they can stand up their own Starbucks branded social network that immediately taps into the Facebook community, and within months the Myspace and Orkut communities as well (pending Ringside’s implementation of OpenSocial support to be delivered in June).

In my opinion, such a move by Starbucks is a no brainer. Customer acquisition is currently expensive, and a social solution, particularly one that requires minimal investment, is likely to have a return on investment that is off the charts.

I read an article today in WSJ on network neutrality, and it got me wondering - what’s the big deal?

Apparently Comcast has admitted to delaying or blocking peer to peer (P2P) traffic on its network, thus allowing more bandwidth for non P2P traffic. On the surface, I thought, so what? A good portion of the traffic on P2P networks is illegal copies of movies, music, and software. Shouldn’t that get less of a priority than “righteous” traffic?

P2P software providers are likely to say they’re being discriminated against, and cite the fact that P2P technology enables the transfer of information in an efficient manner, etc., and who is Comcast to judge what types of traffic deserve prioritization? Good point. Unfortunately for Comcast, the bandwidth available to subscribers depends on the usage levels of their neighbors since the technology is not switched. This is distinctly different than Verizon’s offerings, DSL and Fios, which are both switched technologies (meaning that the bandwidth you pay for is not available to anyone else but yourself). So I would venture to say that Verizon doesn’t have as much of a problem, though certainly they could prioritize traffic on their network backbone if they wanted to.

So what this this all mean? It seems that network providers are in the unique position to affect the financial prospects of many businesses that rely on network connectivity and performance. If I was running a media business whose delivery mechanism primarily used P2P technology that was delayed or even blocked merely because it uses the technology, that could have devastating consequences to my company’s performance. Taking it a step further, if the network provider discriminates based on the technology used, who is to stop them from prioritizing based on content? Maybe Comcast will reduce the priority of traffic to/from specific web sites, which could be anti-competitive.

On the other hand, if I were a Comcast executive, I need to be worried about quality of service. If 15 year olds are degrading service for each of their neighborhoods across the country because they’re downloading movies 24/7, that will lead to defections to Verizon or other competitors. If I’m Comcast, I need to do something to ensure that my customers are satisfied, or my business my lose many customers. Why shouldn’t I be able to preserve quality of service for the masses if I have the ability? It’s my network isn’t it? I own the lines don’t I?

It seems to me that there ought to be a balance between network providers’ ability to manage levels of service on their own networks and openness to policing. Technologies probably would have to be developed to enable accurate identification of content traversing the network, and there would have to be some clear definition of what content can be prioritized across known service levels. Of course, that is easier said than done since there are so many voices in the conversation. I guess my take is that network providers shouldn’t be forced to keep things completely open at the peril of their business.

What are your thoughts?

Recently I purchased and began reading “The Fifth Discipline: The Art and Practice of the Learning Organization” by Peter Senge, as I was doing some work on developing processes for organizational training as per the requirements of CMMI. I was hoping to gain insight into how to design a training program for our company which thrives on learning and continuous improvement. Instead, I learned about a whole new area of interest for me: systems thinking.

As an experienced software developer, I’ve learned to employ design patterns in certain situations to create well understood and easily maintainable programs and components that transcend my own understanding. When you see a singleton pattern in use, you know what it is. When you discuss implementation approaches and call out the command pattern by name, the details are well understood.

When I came across the concepts of systems thinking and system archetypes such as the ‘limits to growth’ archetype, I was very excited to learn that such concepts existed. Immediately I thought, these are design patterns for business! By giving names to these patterns of behavior and the tools to model them, business systems can be clearly communicated to anyone. Those who are familiar with these concepts will know exactly what you mean when you utter the phrase ’shifting the burden’ and indicate a problem symptom and a fundamental solution.

Needless to say, I’m excited to master these concepts and those that build on top of them. In my head, I’ve discovered a whole new set of ‘design patterns’ specifically geared towards communicating and solving business problems. Stay tuned for more on this subject.

technorati tags:business

Blogged with Flock