[ibimage==29150==Large==none==self==null]
Bragging Rights, not Bitcoins, are the Newest Currency | by Howard Tullman
Having just heard the Winklevii twins try to "explain" to a very skeptical Dealbook audience the rationale for their Bitcoin investment and what an exciting new form of currency it has become (nothing less than "Gold 2.0” so they say), I still had trouble figuring out exactly how Bitcoins were likely to change the financial instruments and payments world as we know it. But maybe that's just me.
Bitcoins are definitely a fast, fluid, flexible and “free” solution for effecting money transfers and those attributes are certainly among the most compelling components of any new and demonstrably disruptive technology. But considering the Ozian aspects of its mysterious founder, the apocryphal stories of its formation, and the vagaries of its current administration as well as the utter lack of transparency regarding many of the mechanical functions which allegedly make it work so smoothly, it's just hard to have a great deal of confidence in the whole thing.
So, for my two cents (no pun intended), as far as new "currencies" go, I'd rather bet on the best/worst tendencies and reliably consistent behaviors of ordinary people. One thing I know for sure is that we all revere status and that we all love to keep score and - most of all – that we love to compete with each other and especially with our friends and family. In fact, in many cases, just winning isn’t really enough, it’s just as important to know that your friends lost.
I'm staking my claim on "status" in all its forms and flavors as the next great "currency" and, more importantly, as the most cost-effective and accessible influencer of changes in consumer behavior which is available to smart businesses of every size. Traditional forms of advertising are antiquated and virtually invisible – broad-scale, brute force marketing clearly costs too much and returns too little – but status abides. And now is the time for you to learn how to incorporate these new behavior drivers into your relationships with your customers and prospects.
The fact is that we always knew that status mattered. But it’s only with the comprehensive hyper-personalization of the web (thanks principally to Facebook) that these days we actually have to be whom we are because the days of Internet anonymity are long gone. And, as a result, it’s become possible for any business to: (1) confer upon and award status to others (particularly its customers); (2) to reliably create, measure and track status, achievements, accomplishments, etc. on a massive scale; and (3) to broadly distribute and publish the results in real time to audiences – large and small – that matter to each and every one of us.
Lists of all kinds, leader boards, badges, rankings, etc. are some of the most obvious incarnations of the status tracking/measurement syndrome that's accelerating and being supercharged by social media. And these trends aren’t limited to consumer forums – they’re impacting and sweeping through the business environment as well. One of the earliest manifestations of this kind of behavior was aggregating "friends", "likes" and "followers" before we all came to appreciate that having too many friends wasn’t exactly a good thing. At the same time, these early aggregations were generally enabled by a set of activities that consumers could directly manage and partially influence – if you spent the time, you could up your game and change your position. But today, that’s much less true especially when you compare the old systems to today's tools like Klout and Kred which are primarily beyond the control of individuals.
I realize that Kred has certain self-reporting activities ("uploadable moments") that give its participants some sway over their individual rankings and ratings, but essentially these new measurement systems profess to be aggressively independent and objective even while they entice and encourage us to engage in activities which they claim to be influential in their calculation and evaluation processes.
And, by the millions these days, people are taking the bait and changing their behavior in the (most likely vain) hope that their actions will improve their stature and standings within these artificial (and largely irrelevant) hierarchies. I say “largely” irrelevant because – the fact pretty much is – that without a fairly robust and demonstrable Klout score these days – you can essentially forget about even getting an interview with a top tier advertising agency, PR firm or social media team.
But what does all this have to do with you and your business? Simply this. If you want to keep your customers and, in fact, deepen and extend your connection and relationship with them, you need to understand how these new notions of shared notoriety and the concept of manufactured addictions (where we repeatedly engage in activities for no real economic benefit or actual purpose other than improving our rankings or status on some utterly arbitrary listing or leader board) can be used by you to build better and more beneficial bridges to your customers which will increase their commitment and loyalty to your products and services.
There are basically 3 simple elements to the status equation which almost any business can create and implement (at little or no cost) and – in each instance – your job is to create the levels, tiers and plateaus (almost exactly as if you were building a typical computer game for your customers to play) which will help you generate the kind of quasi-competitive environment that triggers and spurs on this kind of compulsive/obsessive behavior and builds Power Users. Power Users who quickly become – not simply your most lucrative customers – but – even more importantly – your strongest, most authentic, and most aggressive advocates and promoters.
Here’s a basic outline of what you need to think about and construct in the context of your business:
(1) Provide Increased Recognition for your Power Users
You need to develop a simple system to provide, document and publish the increased status and recognition which you are affording your most important customers. There are several companies already in this space who provide various programs with levels, award schemes, badges, etc. that can be easily adapted to your requirements. Just make sure that you take the time to personalize the offerings so that they don’t just seem like the latest and greatest canned incentive program that some consultant sold you.
(2) Provide Expanded Access for the Power Users
As every restaurant, night club, airline and sports team learned long ago, there’s always a “best” seat in the house and there are people who will do whatever it takes and stop at nothing to be granted access to those rarefied levels and locations. In the purest business context, this can range from special service lines, extended hours or credit considerations, concierges, accelerated processing or transport programs, etc. Here again, the incremental resources required to deliver these kinds of programs are trivial compared to the long term lifetime value of retaining these high-end and often hyper-active customers.
(3) Promote “Ownership” by letting Power Users Actually Influence the Business (or at least let them “think” that they are)
To a very real extent, the smartest companies today are designing programs and incentives which basically “hire” their own customers to work for them and encourage them to do significant amounts of work in the name of influence and ownership. Insurance companies are increasingly creating more self-service options for their customers and positioning these things as conveniences and tine-savers for their customers rather than cost savers for the companies which, of course, they are as well. Obviously, Wikipedia’s 70,000 “editors” believe (and rightly so) that they are influencing the end product on a daily basis. And they will continue to do so without any thought of compensation so long as their efforts are acknowledged and so long as they don’t feel that anyone is making a buck off of their hard work and good will. Users groups have been around for quite some time, but the difference is the immediacy with which, and the concrete ways in which, the influence of Power Users is implemented by these companies in virtually real time.
Frankly, this whole approach is just today’s rife of the old Tom Sawyer fence painting scam. As Tom said to Ben: “Does a boy get a chance to whitewash a fence every day?” And a bit later, Ben asked Tom: “Say, Tom, let me whitewash a little.” And the rest, as they say, is literature. Some things never change.
PP: “You Get What You Work for, Not What You Wish for”
