When a business proposition tries to do too much for too many, it can tend to do very little for very few.

There are a number of principles we apply in shaping business ideas, models, and strategies. We’ve written about the importance of focus in terms of marketing. It’s also essential that the model and value proposition to be equally focused.

Quite simply, the best business models do one thing. They have a narrow offering with a broad appeal. You’re looking for the one thing that just about everyone needs or can benefit from. Flickr is a place to store, organize, and share all of your photos online. That’s the one thing it does, and it’s valuable to pretty much everyone. It’s not a one-stop-shop for all of your digital photography needs.

Then there’s Google. It does this one thing—search—that everyone needs. Yes, Google does many things and recently made another push into social media, but it only expanded after it’s search engine redefined the search market. Plus, Google only makes money on search, and most people who use Google only use search. In fact, there is a small percentage of the online population that has no idea what “search” means because they’ve come to know it as Googling.

The power of doing one thing that everyone (or a large percentage of everyone) needs is that you’re message is easily communicated, the market potential can be quite large, and you can establish deep and lasting brand affinities.

The way we organize brands is quite simple and inflexible. When you do one thing and do it well, that brand association can become deeply embedded in a consumer’s mind. This is the psychology behind first-mover advantage. It is an opportunity to create a unique barrier to entry for would-be competitors because you’re brand (and the one thing it represents) becomes embedded in the minds of the people in your market. It then becomes quite difficult to dislodge this brand once it’s been established. This process is currently unfolding in the social geolocation space.

A number of companies are fiercely competing for the “check-in”. That’s what Foursquare, Gowalla, Loopt, and others do. They enable you to check in to a specific location. Everything else about the experience revolves around this one thing. The winner will be the company that ends up owning the term “check-in” in the same way that Coke owns cola and Google owns search. It appears that Foursquare is on its way to becoming synonymous with the check-in, and it’s anyone’s guess whether this market will tolerate a second- and third-place player. So if you want to start a business in the geolocation space, it doesn’t make sense to go after the check-in at this point. But there are many other opportunities.

For example, Plancast enables users to broadcast their plans, complete with geographic coordinates. This startup is clearly in the social geolocation space, but Plancast’s one thing is sharing your plans with friends or anyone else who happens to be listening, such that they can easily join you by knowing the time, place, and nature of those plans. It’s not about checking in, nor is Plancast a one-stop-shop for event planning.

Are there exceptions to the one-stop-shop rule? Yes, but they are rare. Apple is a one-stop-shop. However, unless you’re Steve Jobs, the likelihood of success is much greater when you do just one thing that appeals to a lot of people.

So that’s the question you should ask about your business proposition: What’s the one thing?

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It is our first guest post here at Max Gladwell and we are excited to be contributing to the thought leadership here.

So why we chose this topic is that a surprisingly small percentage of the general public knows that a corporate conversation around sustainability even exists, let alone that they can participate in it. This is despite the fact that many of the largest companies are spending considerable resources to become socially responsible and publicize those efforts.  We discussed some aspects of this in our recent special report Social Media is Advancing the Sustainability Dialogue.

Grail Research recently released a study highlighting the fact that most consumers have no idea that companies like HP, Cisco, The Gap, Microsoft, Nike and General Mills are socially and environmentally responsible companies.  Which was exactly the point of our paper as well – companies need to be doing a better job of communicating the good works that they are doing, and getting ongoing stakeholder input, for a variety of reasons.   Silvia Springolo of Grail Research says it very simply “The low awareness of these initiatives raises huge questions because companies are spending so much money on them. And while green qualities are very important to consumers, they are not being communicated effectively.”

Recently, Deron Triff, CEO of Changents.com has been working to bring awareness of this gap by challenging people to match Fortune 100 companies with their CSR achievements via a 5-question CSR quiz.  The winner receives 100,000 consumer impressions of their Ad (benefiting a company or a favorite non-profit) on the homepage of Changents.com.  Take the CSR quiz now and see what you know – I know it was illuminating for me.

And if companies are spending so much time and money on these initiatives, it begs the question – why do we know so little about them?  If we are serious about wanting to change the world, then these stories need to be a part of the dialogue.  Companies are putting tremendous effort into compiling CSR reports, but at the end of the day who really reads those reports?  More recently, separate CSR websites are starting to emerge – who visits them?

Sustainability is such an important topic that the stories about corporate efforts need to be part of the companies’ overall communications, and companies need to start enabling dialogue with all of their stakeholders.  Conversations amongst a relative few in government, NGOs or other third parties won’t adequately address the various problems we face.  We believe social media is a catalyst for enabling these conversations as more companies try to figure out how to engage with stakeholders in this new world that demands transparency and crowd sourcing to solve our most intractable problems.

It’s important that we get more people talking – this conversation needs to move mainstream and engage with more people where they are instead of trying to get them to specific CSR communications.  Let’s face it very few people read CSR reports much less specific CSR communications.  They need to be a part of regular corporate communications and not a separate stream if we are going to truly embed this in mainstream culture, engage more people in the discussion, and inspire the change we want to see in the world.

Please help to continue this dialogue – would love to hear your thoughts!

Beth Bengtson, Partner, SDialogue

A clever new brand challenges consumerism with a line of ethically sourced products and an ironic message: use less.

How many consumers does it take to wreck a planet? More importantly, how many people will it take to fix it?

It might seem like semantics, but there’s a fundamental difference between people and consumers. As marketers, we tend to think of them as one and the same. We refer to consumer packaged goods, consumer value propositions, and business-to-consumer models. It’s the catch-all term for all those who buy, use, and dispose of stuff. Of course, there’s no escaping the consumer designation. At the end of the day, each of us becomes one of them. Unless.

Unless we make the conscious decision to stop being consumers. This isn’t to suggest that we stop buying and using things but that we simply stop using the term and falling victim to the designation. This semantic shift could lead to a psychological shift, where we stop using this short-sighted and demeaning term to refer to ourselves and others in the collective. Are we consumers or people? If we decide on the latter, perhaps we’ll stop acting like a blind mob with zero accountability and start behaving like conscious individuals. Perhaps.

All of this is a long way of introducing a new consumer people brand known as USELESS.

When we first heard of USELESS, it immediately struck us as brilliant. USELESS is a brand that is well ahead of its time. It’s aspirational. It challenges and speaks up to you. You either get it or you don’t. And while USELESS defies comparison, we’re tempted to call it FCUK with a purpose. It’s that good. And so is its mission and underlying story.

We met with USELESS founder Mark Simmons on a few occasions to discuss the brand and his goals for it. He’s made several appearances at BlobLive LA, where he pitched it to a live audience of fellow entrepreneurs. That’s how we got the below interview. Today, USELESS is a line of branded products, but we see it as much more than that. The brand is a universal message. It’s a reminder that we should not think of ourselves or others as merely consumers. Because we’re people, and we can always strive to use less.

Max Gladwell (MG): What’s the story behind the USELESS brand?

Mark Simmons: Two years ago I was working with Al Gore’s Alliance for Climate Protection trying to work out what to say about climate change that would get people from all walks of life involved to help solve the crisis. I saw that, while many people thought of climate change as a left wing conspiracy, they all felt, regardless of their political views, that we Americans use too much stuff. The thought of “use less” lodged in my mind and a year later when I was trying to develop a brand around reducing use of disposable water bottles and bags it struck me that “useless” would be a perfect name because on the face of it, while it is quite negative, if you scratch just below the surface you see it’s not negative at all, it’s a positive way to message about the desire to use less. And if on the one hand we in the developed world are using too much stuff and that’s contributing to climate change, on the other hand there are people in the developing world who are going without the very basics of life such as clean water and sanitation. In fact, 2.6 billion lack proper sanitation and resulting diseases is the biggest killer of children under five. So there is a natural counter-point to use less, which is to give more. The pieces then all fit into place for me. The brand would be called USELESS and its mission would be to help people USE LESS and GIVE MORE in a cool, thought-provoking way.

MG: What types of products are you selling? Why are they so great?

Simmons: So far we have a small line of products that help people use less and give more, including t-shirts, hoodies, hats, messenger bags, totes, notebooks, and reusable water bottles. They are so great because we’ve sourced amazing products that are highly functional, or utilitarian, are made to last, are made of organic, recycled or recyclable materials, and are all made in the USA. That last ingredient, being made in the USA, has made the whole journey 10 times as difficult. Finding products made from the right materials made in the USA is almost impossible, as manufacturing for this stuff all seems to be overseas. But we wanted all our products to be locally sourced, both to keep our footprint small and so we could support local jobs, and felt it was worth the effort to find the right manufacturing partners here in this country. The messenger and tote bags, for instance, are handmade for us from recycled billboards in a small workshop in Colorado. These products are just the beginning, though. We’re planning on adding new ones over the next few months that meet our strict criteria, including some digital applications for the iPhone and Facebook.

MG: How do you reconcile the contradiction of selling stuff and telling people to use less stuff?

Simmons: We are only selling things that are useful and that people need. But, having said that, we are not anti-consumerism, we just believe we can get people to think about what they consume and the power they have to make a positive difference in the world, whether it’s by reducing their use of natural resources, spreading the USELESS message or helping people who need it most. We also have a “non product” called USELESS Earth that costs $25.00, for which people get absolutely nothing – other than the knowledge that all the proceeds go to fund water and sanitation projects in the developing world. In addition we are starting to produce USELESS stencils cut from recycled steel so people can put our message on their old clothes without having to buy new ones. And then there’s the digital products I mentioned that will help raise revenue and awareness but that will use negligible natural resources.

MG: Is this a for-profit company? What is the revenue model?

Simmons: We are for-profit but are what I guess is called a “triple-bottom line” business in that, in addition to making profit, we aim to do environmental good and social good in equal measure. It used to be the time when there were corporations who were all about maximizing shareholder value and non-profits that were trying to make the world the better place but had no commercial reality. Now I firmly believe you cannot be a corporation (we’re an LLC, in fact) without doing good or a non-profit without understanding how business works. It’s the collaborations between the two that will change the world and I think our business model is one of a new breed that do so. We sell products, whether virtual or real, for a profit but give at least 10% to water and sanitation projects in the developing world and promote a message about responsible consumerism. The money we make will allow us to sustain ourselves and grow without relying on the kindness of strangers, but rather the margin on our products.

By the way, all our giving to water and sanitation is tied to very specific projects down to particular villages in Africa, Asia, or Latin America. People can see exactly where the money goes and what effect it will have. The one we’re currently funding is for a water tank and toilets in the village of Kundorwahun in Eastern Sierra Leone.

MG: Someone at BlobLive recommended USELESS-brand toilet paper. Would you consider everyday CPG products like that? Maybe white labeling Seventh Generation?

Simmons: I think doing post-consumer paper products and other consumer products that meet our standards – of helping people use less, are made in the USA and are well made, is a great idea – if we can find a business model to make it work. Currently, we’re selling products through our website, but plan to start wholesaling in certain stores such as college bookstores where there might be a demand for what we sell. We couldn’t really sell toilet paper online as the economics just don’t make sense, but could help someone like Seventh Generation develop a sub-brand by licensing out the USELESS brand to them, again only if the products meet strict criteria. In fact, the plan has always been to do a bit of a product (RED) by branding products made by other consumer brands.

MG: How do you plan to market USELESS? Who is the target audience?

Simmons: We’re starting to build our presence online through the usual suspects like Facebook, and we are still experimenting with how to do it best. We have a MySpace page but I don’t love MySpace and don’t think we’ll be doing much with it until we have our music strategy worked out. We have a blog of course that feeds directly to Twitter, and I’m trying to post meaningful content that gets across the USELESS philosophy, without being too heavy-handed. And then we’re starting to connect with other like-minded intelligent (did I mention, good-looking?) bloggers like you. Our targets are primarily college students and young adults who appreciate the irreverence of the brand. The brand is not for everyone by any means – older more conservative people seem to hate the name with a passion – but I actually like that, it’s designed to get a reaction.

MG: Where do you see USELESS in five years? What are your long-term goals and objectives for the brand?

Simmons: I think we can be a large niche player in five years time. I’m impressed with what American Apparel has done for instance, and how they manage to combine good products with a social conscience all delivered in a sexy way. I think we can do that but with a broader range of products and less of the sleaze! We’d also like to open USELESS stores to let people experience the brand in the way that Apple lets people live and breathe their products through their stores, and I already mentioned how I think we can partner with other consumer product brands. It’s important to stay true to our principles along the way, something I know is very difficult to do as you grow, but without maintaining that integrity there’s sort of no point.

When starting a new business, we can’t emphasize enough the importance of defining your market and focusing your efforts.

Business ideas often start with simple truths that define the business opportunity. If you’re writing a plan for a sock company, it might be that everyone has feet. It implies that your market is potentially everyone. You have more than six billion customers to choose from. While this is a compelling number, though, you’d be ill-advised to base your entire plan and strategy around such a general idea. Having read countless business plans and heard plenty of pitches, this is a mistake that signals inexperience and a plan that is not fully developed.

It’s always been true that entrepreneurs need to focus their marketing efforts, and this is true more than ever thanks to the Internet and the rise of so many mega-niche, micro-niche, and just plain niche markets. Global domination of the sock market may be your ultimate goal, but you have to start somewhere. You have to focus and define your target audience as narrowly as possible, especially if you’re bootstrapping or working with limited resources.

Much of how you target will be influenced by your product, and your product can be equally influenced by your target market. Again, thanks to the Internet and the rise of social media, defining a market and targeting it is easier than ever. Through social networks and other social platforms, people are self organizing and identifying in such a way that we can reach target audiences with very little effort. We can even garner feedback about how we can improve our product before expanding to a broader audience.

Let’s look at three examples of how entrepreneurs put this into practice.

Mark Zuckerberg: Many think that Facebook started as a social networking platform for colleges. In fact, it started as a network for Harvard University. Initially, you had to have a Harvard email address to sign up. Then it went to all colleges, right? Nope. Then it went to the fellow Ivy League schools. As soon as Facebook captured that market, founder Mark Zuckerberg rolled it out to all colleges, where you simply had to have a .edu email address to sign up. Finally, it was made available to…everyone. Because everyone has friends they need to keep in touch with. That’s the general idea that Zuckerberg started with, but his strategy for world domination began with the students of Harvard, the early adopters that he knew so well. And by limiting his product to that first niche market, in no way did Zuckerberg limit the future success or viability of the Facebook product.

Barack Obama: The President-elect set the stage for how political campaigns will be run in the 21st century, and it has much to do with his entrepreneurial approach. The Democrats started with an ambitious and unrealistic 50-state strategy. If it were a business plan, most investors would have passed. But it worked for Obama because he was selling the universal products of hope and change. Everyone wants to have hope, and by the end of the election everyone was looking for change. But Obama didn’t start by selling it to everyone; he started with a target market of brand evangelists. These were Obama’s early adopters, and they spread his messages of hope and change (sold his products) for him. By the end, he’d convinced many Republicans (Obamacans) to endorse and vote for him, including conservative blogger Andrew Sullivan, National Review columnist Christopher Buckley (son of National Review founder, William F. Buckley), and former Secretary of State Colin Powell. It’s worth noting that it happened in this order and that each is progressively more Republican than the last. In other words, Obama’s marketing spread from the center of his target to the outer edges. Had Obama started by targeting hardcore Republicans, the campaign (his product) never would have gained the momentum it needed for a freshman senator to become the 44th president of the United States.

Hitler: This probably isn’t politically correct, nor does Hitler qualify as an entrepreneur. We don’t mean any offense and don’t take the holocaust lightly. But the man didn’t choose to invade England or North America first. Nevertheless, it’s well documented that he was schooling his forces about American cities and geography. He had a battle plan and fully intended to invade the United States. Where did he start? Austria. And barely a shot was fired because much of Austria wanted to be invaded. Austria was at the center of Hitler’s target market. Austrians (no offense) were the unwitting early adopters for Hitler’s maniacal plan for world domination. Needless to say, Hitler failed (thankfully), but that’s a different business lesson altogether.

Take Aways

In general, our advice is to focus your marketing efforts in two ways. First, target those who will have a passion for your product and the motivation to spread the message. Word of mouth is the most efficient form of marketing. If you can reach people who want to tell others about it, your marketing efforts will be magnified. The second principle, however, is to target those who have the wherewithal to most efficiently spread your message. Just because someone is motivated to tell other people doesn’t mean they’re equipped to do it with any measure of reach. This is where social media becomes a powerful tool. If you can reach someone who is (a) highly motivated to spread your message and (b) has hundreds or thousands of “friends” across the social web, that’s your ideal customer. This is the absolute center of your target market. Start here and work your way out. Many refer to this as the echo chamber.

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Where the company is green and socially responsible…but that’s not something they like to talk about it.

To illustrate this point, we’re pulling from the mental archives. When we read this Business Week article just about a year ago, it stuck in our minds as an exceptionally savvy example of green marketing and PR.

It’s worth noting that we view media through a slightly cynical lens, especially when it comes to the mainstream media. Come to think of it, blogs need a more critical view these days, thanks to various pay-to-play and advertorial practices. Having worked both sides of the PR game, we often wonder exactly how a piece such as Quality over Green: Nike’s New Air Jordan came to be. What was the angle and phrasing of the pitch? How did the conversation go? How did this find its way into print?

This is our hypothetical reenactment of the conversation:

Nike: Hey, we’re launching this exclusive new Air Jordan shoe. The kids love ‘em. Super stylish and high performance. Limited editions. It’s a modern classic.

BW: Sounds pretty cool. Yeah, we saw it on the cover of Complex magazine this month. We’ll be back in touch if we need more info.

Nike: Ya know, I didn’t want to mention this…but the shoes are actually eco-friendly. We use recycled materials and reduce the toxic adhesives through proprietary stitching. We went to great lengths to make them green. But this isn’t something we’re promoting. It’s not really a big deal.

BW: So the shoes are high-performance and eco-friendly?

Nike: Yeah, but it’s nothing. Really.

BW: So you’re not actually promoting the fact that the shoes are green?

Nike: No, not at all. Not in the least. It’s really not a big deal. I mean, we invented a whole new sewing machine to be more green, and that cost a lot. But it’s nothing. Just quietly doing our part for the environment.

BW: I think that’s a story.

Officially, the XX3 is the latest in the three-year-old line of Nike Considered shoes, the company’s line of green footwear. But, be it from concerns of tampering with a proven branded success or fears of a backlash from consumers tired of “greenwashing,” executives chose to focus on the performance of the shoe. Its green factor is an added bonus.

The fact that this story appeared in Business Week would seem to undermine Nike’s supposed coyness about its green manufacturing practices. It’s doubtful that this journalist went looking for a story about a company that’s quietly going green and doesn’t want anyone to make a big fuss about it. You know, just doing the right thing. Instead, the story was actively pitched as such. “We’re green, and we don’t promote it. Except for this one time, but that doesn’t count.”

This doesn’t mean Nike didn’t beautifully execute on this nugget of PR, nor does it take away from any efforts it’s making to “go green”. Given the challenges of making sustainable practices work for a company i.e. showing some type of return on investments, Nike played its hand as well as it could have in terms of leveraging this CSR asset. But let’s not kid ourselves about why Nike chose not to market the shoes as green.

If the company believed for a moment that Air Jordan customers gave a crap about whether the shoes were green or not, you can be sure that Nike wouldn’t hesitate to promote it. But these customers don’t. Performance, style, and exclusivity are the only qualities they look for (we’re making a broad assumption, of course). And that’s the way it should be.

The quality of “being green” will never appeal to everyone. The ultimate goal of sustainability is not to make green a marketable quality so we can sell more stuff. It’s not to make green fashionable or to get people to buy things because they’re green, which only encourages consumption. The end game is to make green a mandatory quality that all products and companies need in order to be competitive. Much of this has to do with market forces and pricing in the external costs for pollution and waste, such that the green alternatives makes more economic sense than the non-green. Economics is the most powerful force for change because it’s driven by clear, rational decisions. Marketing, on the other hand, relies largely on guilt and vanity. It can be effective, but it’s not…sustainable.

Case in point, Nike’s target market won’t be emotionally swayed by how green the new Air Jordans are. And the company shouldn’t get PR points because it chose not to market a quality that its customers don’t care about. But there are people who do care about the company’s green bona fides, which is what makes this bit of PR so well executed. It’s no coincidence that this story with this angle appeared in Business Week as opposed to Complex, Spin, or some other magazine that appeals to the target demo.

Nike’s communications department was clearly trying to get this message to investor types and other stakeholders who read Business Week. Because while Nike has largely recovered from its PR debacle with child labor, it still needs to build its CSR reputation for the sake of investors and talent recruiting. These days, sustainable manufacturing and risk management go hand in hand. It also doesn’t matter whether the Business Week reader cares about green or not because the story has a broad appeal. If you think green is bad for business, at least Nike isn’t promoting it. If you think it’s good for business, then it’s reassuring that Nike is doing something. Either way, Nike looks good.

The lesson for marketing green is to know your audience and craft your messages accordingly. Green may not sell as a product quality, but that doesn’t mean it can’t be sold.

Social media experts project the year to come. These are the best of the best social media predictions for 2009.

The annual ritual of prognosticating is in full swing, and there’s only a few days left before the deadline. We’re trailing slightly behind, but we’ll be sure to catch up. These are the best of the best of what we’ve seen so far.

Junta42 featured a long list of 42 social media predictions from many thought leaders in the space. These are the 10 best, complete with color commentary:

1. Patsi Krakoff aka The Blog Squad: In 2009 we’ll see more brands developing a personality or a persona to represent the core values of the company. This ‘persona’ will be responsible for most of the brand’s blog content and social media messages. As The Blog Squad, my partner Denise Wakeman and I have realized the importance of ‘persona’ to connect with people and to represent what our company does. Fortunately, we’re real people. I pity those companies that are going to have to invent a persona because that will never work as well as authenticity. I predict that 2009 will be the Year of the Personality!

Max Gladwell (MG): Max Gladwell is the personification of an ethos and an ideal that’s grounded in the principles of entrepreneurship, social media, and green living. It’s a brand persona, and since we’re totally transparent, there’s no issue with authenticity. A persona just enables us to engage on that level when it comes to the social web. There’s no reason why companies can’t do the same thing. Which leads us to the next prediction.

2. David Meerman Scott: Many marketers have now discovered Twitter. That’s a good thing. However, I’m seeing more and more Twitter feeds created not with a person’s name “Mary Smith at Acme Products” but instead the feed is created with the company name instead “Acme Products”. While I’m sure that some people may want to follow their favorite company, I’m seeing many of these feeds as a derivative of spam because they just prattle on about their products and services all day. I predict that in 2009 there will be a backlash against company Twitter accounts and either the Twitter community will need to self-police or the good people who run Twitter will need to make rules.

MG: There’s no reason why a company can’t have an authentic and valuable Twitter stream that’s also branded. Individuals can spam just as easily as companies. It has entirely to do with the person or people who are managing it, together with the larger social media strategy for which the Twitter steam is a part.

3. Paul Dunay, Buzz Marketing for Technology: I think you will see more companies acting like Media companies and even launching their own media properties based off of blogs, communities, and wikis they set up over the last few years.

MG: Today, every company is a media company. Most just haven’t realized it. We help our clients to essentially free their inner media company and operate more like publishers. This is a tremendous opportunity, and there is a lot of work to be done.

4. Jason Falls: Creating and distributing branded content will have to focus around something other than the brand to be optimally successful. Whether it’s a lifestyle, peripheral niche topics or by championing a cause or position, innovative brands will start to provide engaging content that allows them to intertwine the brand rather than push it as the primary selling point.

MG: This is all about being relevant. Your product or brand is not an island. It fits into a bigger picture. When it comes to creating content, whether it’s branded or editorial, it has to be valuable and relevant. That’s how you’ll win. Social media cause marketing will also be big in 2009, thanks in part to the tone set with Obama and the Millennial generation.

5. David Reich, Reich Communications, Inc.: Marketers will continue to experiment with social media in 2009, although they may not get into it as deeply as they might have hoped before the financial meltdown. But tight budgets might work in favor of trying social media, since programs on various platforms, especially blogs, need not be costly to be effective at reaching and engaging customers.

MG: Despite the hurdle of precisely measuring ROI, executing on most social media strategies is cost effective no matter how you measure it, especially compared to most of the alternatives. After all, Dell figures it generated $1 million in revenue off of its Twitter alone.

6. Ann Handley, MarketingProfs: In 2009, an increasing number of journalists find themselves out of work at traditional newspapers, which continue to struggle with sustaining their business. Good news: the writers find a home as “content producers” and “content managers” on the corporate side, in companies of all shapes and sizes.

People who are trained as journalists are specifically geared to helping companies execute on their 2009 marketing strategy, which is to become trusted sources of information within their specific industries. They can help companies see the wisdom of talking less about the company itself, and more about solutions they can help their customers with. They are wonderfully creative in developing interesting and compelling content. Advice: If you are thinking of increasing your content play in 2009, hire a journalist.

MG: We’re journalists by trade. The best PR firms have always recruited journalists, and now marketers are waking up to the value of using top-notch storytellers to tell their clients’ stories. It’s a tough time for journalists, so it’s good news that they (we) will play a key role in the new new media revolution, where all companies are media companies.

7. Ardath Albee: In 2009, content will help companies become ubiquitous in their area of expertise. Instead of only sharing their expertise with people who come to their websites and fill out a form, B2B marketers will start spreading (syndicating) their content across the Internet to intersect with where their customers and potential customers hang out.

MG: This “intersect” is the essence of the beacon approach. It’s about sending signals into the Web by way of content that crosses paths (or intersects) with people who are predisposed to the message and listening for it. They follow the signal back to the source, and you’ve got some potential sales.

8. Michael Blumberg: Giving high-quality content as a gift with no strings attached is likely to increase consumer appreciation. I therefore predict that brands will shy away from ads and toward sponsoring more independent editorial.

MG: Again, it goes back to being the most relevant brand in your category. If you’re Subway, you want to be producing editorial around nutrition and fitness that has nothing to do with your actual products. But it has everything to do with the relevance of your brand.

9. Russell Sparkman: In particular, 2009 will herald the widespread emergence of marketing and public awareness communications content that sits at the nexus of corporate communications and journalism. As more and more non-media organizations begin to think and act like publishers there will be increased emphasis in quality and professionalism in content creation. Corporate, non-profit and government websites will become more and more like online magazines or channels. And those who recognize the importance of compelling, authentic storytelling content in their online communications will see the greatest long term ROI from their content investments.

MG: Unlike advertising, valuable content can earn long-term residual returns. The barriers to creating and distributing content have come down to the point where it’s just as cost effective to create your own media channel as it is to advertise on someone else’s.

10. Gordon Plutsky, King Fish Media: Traditional media companies will continue to lose ad revenue from companies who are now creating their own content to own their own media channel.  However, smart media companies will prosper by offering innovative lead generation programs for companies to distribute their content to new audiences. Content creating companies and media companies will create win/win partnerships to leverage the relationship’s media brands have with their audience to marry with company created original content.  The combination will result in a positive environment for content marketing.

MG: First there was advertising. Then came advertorial. The next step is branded media channels within existing media companies that brands own and control. The brands will essentially pay rent for the space in which to publish their content and gain access to an existing audience. The final step, though, is that the brand no longer needs the media company.

Change.org grows traffic and improves engagement as a result of its new blogging strategy.

In early October, Change.org re-launched its social action platform with a new blogging strategy. We immediately wrote that “Change.org Shifts Strategy to Blogging and Content.” The site was re0rganized around topical blogs for each of the causes such as global warming, immigration, gay rights, and social entrepreneurship. We went so far as to claim that blogging had won over social networking and that content had won over connecting. Of course, at the time there was nothing to back this up.

Three months later, Change.org’s Compete numbers are off the chart (relatively speaking).

Traffic grew by nearly 700% over two months from about 21K to nearly 150K unique visitors per month. We don’t have the actual analytics. Compete.com provides estimates that, in our experience, are light by about 20% but otherwise fairly accurate. At the very least, it reliably shows trends one way or the other. And while the spike in traffic could be attributed to factors that don’t relate directly to the new content strategy, Compete.com also shows a similar boost in engagement that implies the content is not only driving traffic but keeping people on the site longer.

According to this, total time spent (attention) grew by more than 700% over the same period. What drove this success?

Change.org began as a online community that enabled people to network and organize around social causes. Their members could connect with other like-minded individuals and support the nonprofits that addressed their chosen causes. Ultimately, donations could be made and action could be taken. What was missing, however, was actionable, engaging information. Yes, we know there is genocide in Darfur and that global warming needs to be addressed. But just knowing that an issue exists and being passionate about it doesn’t necessarily inspire or translate into action. And that’s what Change.org ultimate needs to do in order to be successful. On the other hand, if we have a consistent source of relevant news (content) about that issue, we’re reminded about how we can affect change and why we want to be a part of the solution.

On a practical level, content is what people are ultimately searching for. It’s a key to being a beacon and attracting precisely the type of customer or user you’re seeking. Because they’re also seeking you. Content becomes a sustainable, long-term source of traffic and potentially conversions, especially when it’s organized on topical blogs in a relatively narrow fashion.

Recently, the healthy-conscious-green-living portal Care2 adopted a similar strategy. This month it launched a cause news network, which consists of blog channels for global warming, animal welfare, politics, civil rights, and many other cause categories. As with Change.org, the causes themselves are built into the URLs (http://www.care2.com/causes/global-warming), which is highly SEO friendly. Care2’s rate of new posts is not as high as Change.org, which we’ve observed at about one new post per day per blog. Nevertheless, we’ll track Care2’s success and follow up in a couple months.

It’s also worth noting that Care2 and Change.org have different business models. Whereas Care2 is predominantly an ad-driven business, Change.org relies on its nonprofit platform, for which it charges a fee, as well as taking a percentage of charitable donations made by its members.

(Note: it’s possible that Change.org’s recent success is attributable to other factors, and we welcome input from the company or others privy to this information.)

Update: Below are the Compete.com numbers including December 2008. The growth spurt continues. And the company just launched seven new blogs as of January.

Update 2: Change.org continues to increase its traffic. Here are the January ‘09 Compete numbers: Up 2000% on the year with 715K unique visitors. All about content and engagement. Obama certainly didn’t hurt, either. 

Down with the cause in the down economy. Cause marketing is about more than doing good. It’s about maintaining competitive advantage.

Editor’s Note: Max Gladwell is proud to welcome Tom Watson as our first-ever guest blogger. Tom is an entrepreneur, journalist, philanthropy consultant, and soon-to-be best-selling author of CauseWired: Plugging In, Getting Involved, Changing the World.

The economic forecast remains grim. Big companies are crashing and governments are putting up public capital to prop up national economies. The stock markets twitch like unstable isotopes looking for the lost atomic particle of easily available credit, and the job forecast is dark indeed.

Philanthropy will take a hit: only twice in the last four decades has American philanthropy declined for two consecutive years – during the 1970s oil crisis and after the terrorist attacks of 2001. This economic crisis is likely to add a third. And even including those declines, philanthropy in the U.S. has always remained within a narrow band of the American economy – between 1.7% and 2.2% of GDP, year after year.

So funding for causes will remain, even if it depresses for a couple of years. With more competition for shrinking philanthropic dollars, will the least-proven and most experimental forms of public funding – the peer-to-peer models we all work on – fall by the wayside?

I would argue that the answer is no – a strong, spirited “no!” as a matter of fact.

When I started to research by book CauseWired: Plugging In, Getting Involved, Changing the World – which will be released by Wiley on November 10th – I didn’t just focus on the innovations of the last two years. Indeed, the earliest online social activism platform profiled in CauseWired was started way back in 2000 by a history teacher from the Bronx. Charles Best created DonorsChoose a year before 9/11 and nurtured it through the hard years as he perfected the model and expanded its scope. As of last spring, DonorsChoose had raised more than $25 million for public school projects and enhancements – one of the big peer-to-peer giving success stories ever. It was created during the dot-com bust and survived the drop in funding after the terror attacks.

Looking at the landscape in a donor-challenged economic recession, I can’t help but think that in some ways the market is coming back online social activism platforms – rather than the other way around.

Think about it. Online social activism platforms are, generally speaking, lean operations. The more than 40 platforms we’ve identified at CauseWired (and supplemented by Christine Egger over at Social Actions) do not boast deep balance sheets laden with venture capital, or vast marketing operations designed to build their brands rapidly. As hard times nip at the world’s heels – and this truly is, in my view, a global economic crisis – the cause start-ups should be well-positioned to survive, and in many ways, to help provide assistance where it may be needed more than ever.

Public relations has lost its meaning. Are you looking for media relations, blog relations, or consumer relations?

The business of public relations (PR) used to be simple. You hired a firm that had relationships with editors and journalists…relationships that were built through the revolving door that is media and PR. The PR firm pitches your story to their friends in the media, which includes so much schoomzing and schwagging. You get stories written about your company or product, also known as “hits”, which raises your profile.

Except that this has never actually been “public” relations. The PR firm doesn’t work with the public. It works with the media, which makes it media relations. And in the Web 2.0 world, this distinction is more important than ever.

As far as we can tell, public relations is broken. On one hand you have these large, aging firms that don’t get blogging and Web 2.0. On another hand, you have those that are focused so much on blogs that they are valuing quantity over quality. And finally you have those that “get” Web 2.0 so much that they’re trying to make this simple business of publicity into something it’s not.

In the following, we’ll seek to break down what has been inappropriately labeled as “public relations” into its fundamental parts: media relations, blog relations, and consumer relations. As a company, you should know which one you’re getting, the impact it will have, how much it will cost, and your return on investment. Otherwise, you can book that PR retainer as a loss or unpaid debt. If you work in PR, this might also help save your job because PR is one of the first budgets to get cut in a down economy.

Our background in PR dates back to our first entrepreneurial venture in ‘94. We didn’t hire a PR firm but rather earned coverage in the major consumer magazines in our industry, such as Men’s Journal and Bicycling, along with television appearances on ESPN and Fox Sports. We were running an adventure-travel outfitter that specialized in mountain biking. From there we jumped over to the journalism and editor side and experienced the work of Edelman, Hill and Knowlton, and other major firms, along with internal communications departments, as part of the media. We jumped back on the marketing side and managed two major firms–Sitrick and Company and Vollmer PR–for an alternative-energy client. Michael Sitrick is the crisis PR guru and literally wrote the book on spin. So we’ve seen our fair share of PR from all angles.

One of the first questions to ask yourself is whether or not you need a PR firm. Jason Calacanis doesn’t think so. His mini-manifesto on PR is excellent. Enjoy it for what it’s worth. We agree in many ways and have often mused that PR folk will be the travel agents of Web 2.0. The only problem is that we’re all not born to self promote, and it’s not necessarily something you can learn. PR is like accounting in that way. You can keep track of your receipts and maybe even keep your books in order. But it takes someone with training or natural-born talent to do the big stuff. Calacanis is a born publicist and self-promoter, and his principles are proven and sound. But your talents as an entrepreneur might be more valuable in other areas of the business, in which case investing in the right type of PR with the right person or firm makes perfect financial sense.

Today, every PR firm fancies itself as a social media firm or else they have a social media division or practice. In our experience, however, this just means they’re doing the same things they’ve always done, only with bloggers. So we have some suggestions about ways that firms and clients should look at the new PR landscape. We call it PR 3.0 not because it’s the next evolution but because there are three primary parts. And to poke fun at PR 2.0.

Media Relations

Since the dawn of mass media, this is what public relations has been about: print, radio, and TV. More recently, it includes mainstream online outlets that are run like traditional media, but these are typically a value add.

These mediums are still the primary channels of information and entertainment, and their value reflects this. Try pricing out ad rates in any national magazine or TV program. Then compare it to the CPM for blogs. Traditional media, especially in print magazines, is finite. You get anywhere from four to 52 issues each year. If your company is featured in one of these, it’s among a fairly select group. Compare that with the infinite universe of the blogosphere and online media. We’ll take a small mention in Wired magazine over a large mention in the blog equivalent any day. Because it’s not just the direct exposure but rather the privilege of having been featured in Wired. That’s where the true value of a big, mainstream hit is realized.

Generating this type of exposure, though, takes solid relationships. Try phoning or emailing the editor of Time or Vanity Fair. In fact, try picking the right editor to direct that call or email to. Not that it would matter, because you’d be wasting your time. That’s what you pay professional PR flaks to do. They get to know your story, craft a pitch, and call the editors and journalists that they (a) used to work with or (b) recently sent a bunch of free stuff to, most likely from a different client. Either way, they have access. PR flaks are to editors what lobbyists are to politicians. It’s not what you know but who you know, and that’s what a client ultimately pays for.

When you measure the ROI for traditional media, it’s typically pegged to equivalent ad rates and expressed as “media value”. There are accepted practices in PR for determining this, and the PR firm will give you a monthly report with a list of values and a bottom line. Hopefully it’s more than the retainer you paid.

This is media relations in a nutshell. It’s as old as newspapers, and it’s barely changed since. It’s not rocket science. It’s relationships. When it’s done right, it can be quite effective, and you can measure that success. In fact, there are performance-based PR deals that put rates on nearly every type of coverage. You only pay for what you get. We urge people to explore these, as they properly incentivize the PR firm to not waste your money.

Blog Relations

With the rise of blogs as significant influencers and trend setters, PR firms have embraced this new medium. It is another channel for reaching the public, for sure, but it’s a much different game than media relations. Though blogs are technically media, bloggers don’t necessarily see themselves that way. And when public relations firms lump bloggers in with their media relations, they do everyone a disservice, especially the client. So first of all, if you’re a PR firm that wants to promote a client to bloggers, don’t approach it like media relations. These are much different animals. And if you’re screening PR firms, make sure they know the difference. Just having a “social media practice” doesn’t cut it. This isn’t social media. It’s blog relations, and if a PR firm doesn’t know this, move on.

At Sitrick and Company, which specializes in media relations, they pride themselves on hiring journalists. Why? Because journalists know what it’s like to be pitched and hounded by PR flaks. They know what journalists like and don’t like. They know the level of skepticism and cynicism with which most self-respecting journalists view PR flaks. So they curb all of that crap and deal with their fellow journalists as a peer: once a journalist, always a journalist. So there’s a mutual respect. This is a reality that many PR firms don’t get, but it also translates into blog relations.

If you’re working for a PR firm and you’re tasked with doing “blogger outreach” or managing a client’s blog relations, the best thing you can do is to become a blogger. How simple, right? If you’re in PR, chances are you can write. You’re probably also somewhat of an expert in PR, so you might want to blog about that. Or if you have another hobby or passion, blog about that. If you want credibility and that sense of mutual respect from bloggers, become one of them (one of us). If not, then you’re wasting our time. Go back to media relations.

Beyond this, there’s plenty of banter about PR 2.0 and how it’s so different from, well, PR 1.0, whatever that was. In fact, the high-level differences are pretty subtle. As much as some people want to split hairs and argue semantics, it’s still publicity. It’s still a matter of pitching your client’s story to those who have an audience. You’re not curing cancer. You’re hustling stories. The true difference between mainstream media and blogging is the medium.

There’s been plenty written about the social media press release, which is essentially a different form of release that cuts to the chase and provides multimedia. In our opinion, it should be called a blog release. Because at the end of the day, it’s intended to make a blogger’s job easy.

It’s true that the traditional press release is ineffective for blog relations. It’s the wrong tool. Bloggers aren’t trained, by and large, in the AP style. They haven’t drunk the AP Kool-Aid, and so they look at these stodgy, formulaic documents with the robotic quotes and corporate-speak with an understandable level of WTF. The press release is a relic from the days of one-way communication: company feeds info to media; media feeds info to public. Blogging is a conversation, and so companies have to present their releases in a more authentic and conversational form. Furthermore, the blog release should be a living document that gets updated as that story unfolds in both the blogosphere and mainstream media.

But this isn’t the quantum shift that the preachers of PR 2.0 make it out to be. It’s simply a matter of understanding and adjusting to the medium. It’s clear that many PR firms don’t get this, but it’s not because it’s hard to get. It simply requires separating your firm’s blog relations from its media relations and never mixing the two. Especially when it comes to ROI.

This is where PR firms are really gaming the system. The currency in PR is the hit. And with the rise of blogs, PR firms have been able to generate many more hits with much less effort. After all, there are only so many newspapers and magazines, while there are millions of blogs. What’s more, many bloggers are just looking for good content to post. There are no hard costs involved. They don’t have to bump a story to fit it in. They don’t have to pitch it internally and run it through the editorial approval process. If you’ve done your job as a blog relations pro, you’ve packaged the blog release in such a way that a blogger has to do little more than copy and paste. (More reputable ones will write a largely original post.) This is clearly not as valuable as its print counterpart, and the ad rates and PR effort it takes reflect this: value in, value out.

And yet we’ve seen binders full of print-outs with all of the blog hits that a PR firm has produced for its client. As if to say, “Look at all the great coverage we’ve gotten for you!” The question is how much are these actually worth? What is the actual value and how is it being measured? What are the metrics? The problem is that not only are PR firms using media relations tactics in pursuing blog relations, thereby damaging their client’s reputations, but they’re trying to pawn off blog hits as just as valuable as media hits. Just because you print them and put them in a binder does not make them print coverage.

What seems to be happening is that these firms are putting interns and associates on blogger outreach for the firm’s low-priority clients, while the high-priority clients benefit from the senior-level relationships that one needs to do effective media relations. These low-priority clients are placated with binders full of blog hits, but to what end? Where is the value?

We’ve developed a system for measuring the value of blog hits that we make available to our clients. As PR skeptics, one of the roles we serve is to analyze our clients’ PR return and suggest adjustments. We know that PR is valuable and that quality media relations and blog relations can earn a significant ROI. Unfortunately, though, you can’t give PR firms an inch. They have to be clear on what’s expected and vice versa. You have to demand execution and performance. Otherwise, you’re wasting time and resources.

Consumer Relations

We use “consumer” for lack of a better term. This is closer to what we’d call social media, because it is a form of PR that puts the people of a company in direct contact with its customers and potential customers. In short, it humanizes a company and builds trust. This is PR 2.0. Unlike media relations and blog relations, customer relations has no go-between or middle man. No one to interpret and tell your story. No pitching and no racket. It is authentic and empowering and sometimes even risky. But the good will and value are second to none.

As a counterpart to customer service, where a company is typically responding to problems, consumer relations engages customers and the broader public in a more positive sense. It celebrates the product or brand and keeps everyone informed about developments, news, updates, and changes in a one-on-one format.

There are many ways to initiate and manage a consumer relations effort. A corporate blog is the easiest method, though it’s far from a one-size-fits-all formula. Corporate blogs require specific strategies with clearly defined dos and don’ts. The risks of corporate blogging increase in proportion to the size of the organization and should be weighed accordingly. That said, it’s one of the best ways to engage with your most dedicated customers and earn valuable feedback.

Companies can also build all manner of social networking applications, microsites, social networks, wikis, and other programs in an effort to engage directly with their customers, while allowing customers to engage with one another. This is participatory PR, which is the best kind when it’s done right.

We’ve often heard PR described as a necessary evil. No one likes paying for it, but everyone needs it. However, if you approach PR with a clear set of expectations. If you’re familiar with the different types of PR and how they function. If you don’t accept excuses but rather demand a return on your investment, PR can be an effective and profitable part of your business strategy.

We welcome comments from PR flaks, PR clients, and anyone who’s ever had a positive or negative experience with PR.

Update: This excerpt from The Cluetrain Manifesto is so brilliant and spot-on that we felt this piece was incomplete without it.

Ironically, public relations has a huge PR problem: people use it as a synonym for BS. The call of the flack has never been an especially honorable one. There is no Pulitzer Prize for public relations. No Peabody, Heismann, Oscar, Emmy, Eddy, or Flacky. Like all besieged professions, PR has its official bodies, which do indeed grant various awards, degrees, and titles. But do you know what they are? Neither do most PR people. Say that you’re an award-winning PR person and most people will want to change their seats.

Everyone — including many PR people — senses that something is deeply phony about the profession. And it’s not hard to see what it is. Take the standard computer-industry press release. With few exceptions, it describes an “announcement” that was not made, for a product that was not available, quoting people who never said anything, for distribution to a list of people who mostly consider it trash.

Dishonesty in PR is pro forma. A press release is written as a plainly fake news story, with headline, dateline, quotes, and all the dramatic tension of a phone number. The idea, of course, is to make the story easy for editors to “insert” in their publications.

But an editor would rather insert a crab in his butt than a press release in their publication. The disconnect between supply and demand could hardly be more extreme. No self-respecting editor would let a source — least of all a biased one — write a story. And no editor is in the market for a thinly disguised advertisement, which is the actual content of a press release.

If you like word-of-mouth advertising, you’ll love discovery marketing.

When it comes to social media marketing, we like to say “it’s better to discover a product with unique value than to be told a product is valuable.” This is the essence of what we call discovery marketing. Since the term can’t be found in Wikipedia, we’ll assume for now that we’re using it in an original way to describe the following.

Discovery marketing is essentially what we outline in Be a Beacon. It’s a strategy that maximizes the discoverability of a product or brand on the Web with an emphasis on the social web. We describe many of the tactics including blogging, RSS, SEO, and lifestreaming. We divide target markets into two groups: those who are looking for you and those you are looking for, where the beacon signals are programmed accordingly. The ultimate goal, though, is to facilitate a discovery.

We’re all aware of the power of word-of-mouth advertising, also known as word-of-mouse in online circles. It’s widely considered the best kind of advertising because the brand message is being spread through trusted referrals. This is why marketers put so much faith in social networking because networked individuals can spread a message more quickly and to more people more easily than non-networked individuals. That’s why today’s key influencers, whether they be moms or tweens, can largely be found online. Still, a word-of-mouth message has to start somewhere. And whether or not it originates through a discovery can make all the difference.

Paid advertising is one way to distribute and originate a brand message. It’s a direct pitch. The company is telling you why it’s product is valuable and why you need it. If you decide to try the product, you’ll find out whether or not it lives up to the hype. The only discovery being made, then, is whether or not the company was being accurate in its ads.

Assuming that’s the case and you like the product, it’s possible that you’ll refer a friend or two i.e. what we call word-of-mouth advertising. But this isn’t a discovery either. It’s just second-hand advertising. It can be effective and often is, but not quite as effective as when the origin of the message is a bona fide discovery.

When someone makes a brand or product discovery, it creates a connection with that brand or product that no ad pitch or word-of-mouth referral can simulate. It’s the fabled a-ha factor or a-ha moment, when the true value and uniqueness is revealed through a learning process and personal experience. This is ideally how all customers should come to know and appreciate a product.

There are many ways to employ discovery marketing. A demo tour where a company enables prospective customers to try its products in an appropriate setting, such as what Burton does with snowboards, can facilitate discoveries. Sample trays at the grocery store or farmers market enable discoveries of new food products. What sets this apart from advertising and referrals is that there’s little or no pitch. The idea is to position your product or brand such that it can be discovered by the right type of customer in the right setting. Burton would have a tough time demo’ing its snowboards at the beach, which is why they do it at ski resorts. On the social web, companies can use similar methods to aid potential customers in discovering their products or brands. And the nature of the social web makes these efforts that much more powerful and effective.

By using the beacon tactics of blogging, Twittering, social networking, and YouTubing in strategic ways, you can make your brand more “discover friendly”. In other words, by sending these targeted signals into the social web, you are enabling people to follow them back to the source, where the discovery can be made. There is no pitch involved, lest you be a spammer, but rather quality content that provides value in and of itself. Burton can’t offer snowboard demos on the Net, but it can produce compelling content that snowboarders will appreciate, and that can lead to a discovery of the Burton brand.

When discovery marketing and word-of-mouth meet on the social web, the results can be especially powerful, even viral, because those doing the discovering are highly motivated to spread the message. There is a certain pride of ownership in making a product or brand discovery. It’s similar to those who discover a great article and then submit it to Digg. They proceed to promote it to their friends in the hopes that it’ll get voted to the front page. We take pride in the things we discover, whether they be articles, products, or brands. We want to do our friends the favor and be known to them as the one who first discovered something cool or useful. We don’t, however, tend to feel the same way about products that get pitched or advertised to us.

This isn’t to say advertising and traditional word-of-mouth don’t work. It’s just that discovery works better. Therefore, all brands should strive to become more discover friendly.

Photo: Flickr

Update: This post was partly inspired by Ari Herzog’s call to action, “Social Media Marketing Tip: Pause“.

His call to action went as follows: “On that note, I tag David Bradley, Max Gladwell, Jacob Morgan, Gillian Swart, and Kim Woodbridge to add to the conversation on their blog.”

To which we responded, essentially, that making your brand or product more discoverable through social media can be a supremely powerful marketing strategy (see above).