What is Klout worth to you?

Posted on October 31, 2011 at 7:28 am UK

What a kerfuffle Klout has stirred up! The US company that offers a service to “measure influence online” made changes last week in the technology it uses to calculate an individual’s influence rank known as a Klout Score.

One of the results of the changes – all to do with improving the algorithms that calculate an individual’s Klout Score – is that “a majority of users will see their Scores stay the same or go up but some users will see a drop,” the company said.

My bold emphasis in that quote highlights what rapidly escalated into howls of protest by users as people’s Klout scores tumbled showing lower numbers – dramatically lower in some cases – which the formal posts on Klout’s blog did little to help people clearly understand why.

I’m a Klout user and, like many people I know, one who spent a lot of time trying to figure out how it works and whether it has any measurable value. As a user, I still don’t know for sure (give me a marketer’s hat, though, and it is clearer). But it doesn’t matter: I came to a conclusion a while ago that the value of services like Klout is more in the eye of the beholder, as it were, than in the subject’s eye.

It’s what others believe to be the value of a particular Klout Score to them. That requires a considerable amount of earned trust – and that, it seems to me, is where Klout has now got itself into some serious hot water.

The foundation of Klout’s business is the scoring system and some clever technology that runs it. But closely linked to that is a pure-play marketing programme that offers perks to users if they meet specific criteria connected to their score and their activity in the social spaces that Klout tracks, notably Twitter, Facebook, LinkedIn, Google Plus, Foursquare, YouTube, Instagram, Tumblr, Blogger, WordPress, Last.fm and Flickr.

The Klout Perks programme has attracted some big-name brands in the US such as Audi USA, Red Bull, Axe, Chiquita, and more.

And that’s where the cosy informal social-ness of a ranking or score hits the hard reality of marketing in a company that is attracting interest from investors that could give it a valuation of at least $200 million. And it looks as though the marketing is very hard nosed indeed as Ike Pigott’s experience clearly suggests.

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My Blackberry is (still) not working

Posted on October 13, 2011 at 6:58 am UK

I first posted this video satire about the Blackberry (and Apple) smartphone by comedians Harry Enfield and Ronnie Corbett last December. In light of the continuing serious downtime issues with RIM’s Blackberry network, affecting users worldwide, it seems exceptionally apt to take another look.

(If you don’t see the video embedded above, watch it at YouTube.)

On a serious note, though, this ongoing outage presents Blackberry maker RIM with an alarming loss of reputation, never mind considering its position in a hugely competitive market where major competitor Apple announced a new iPhone last week and new Android devices are coming from competitors everywhere. Is RIM headed for disaster? Plenty of opinion suggesting they’re in serious trouble now. (And prize for best new word of 2011: ‘woefuk,’ tweeted by Alastair Campbell.)

Still, as we like to say in England, always look on the bright side…

[Later] While RIM’s Blackberry woes still attract humorous commentary and opinion, let’s add a perfect cartoon from Matt in today’s Telegraph.

Don’t ignore your customers who tweet

Posted on October 12, 2011 at 12:43 pm UK

If you’ve ever vented some feelings on Twitter about your negative experience with a company, and felt you were ignored, a survey from the US will probably resonate with you.

It suggests that over 70 percent of consumer complaints made on Twitter are ignored by the companies concerned.

Research firm Maritz Research carried out the research in September when it surveyed an online panel of 1,298 US consumers who had pre-identified themselves as Twitter users who frequently tweet, had complained via Twitter about a company with whom they do business, and who were at least 18 years old.

The survey shows some interesting results:

Of those who received follow-up:

83% said they liked or loved hearing from the company

Only 4% didn’t like or hated hearing from the company

Nearly three in four were very or somewhat satisfied with the company’s response

Of those who did not receive follow-up:

86% would have liked or loved hearing from the company regarding their complaint tweet

Only 1% would have not liked it or hated it if they were contacted by the company regarding their complaint tweet

63% would not like it or hate it if the company contacted them about something other than their complaint tweet

No surprises here:

Of the people who received outreach, 83% said they liked or loved hearing from the company
Of those who didn’t, 86% would have liked or loved hearing from the company regarding their complaint tweet

I publicly posted about this on Google+ earlier today. Two comments to that post stand out:

Sean Carlos – A bigger concern, IMHO, is that twitter is too often used as a crutch to make up for inadequate “standard” support channels. By bringing their complaint into the public domain, consumers are often able to get redress otherwise denied them. That probably isn’t the most effective solution for businesses nor consumers.
Marco Barra – I think business still don’t realise that dealing with these very public complains does not mean that they have to be dealt with publicly! – Often a message such as “I’m really sorry you’re unhappy with XYZ, please DM me your telephone number and I will get one of my guys to call you right back to resolve this issue” is more than enough to move the conversation to a more private channel and defuse the situation altogether.

Consider Twitter as a valuable channel for feedback from your customers that complements your other CRM activity. It doesn’t really matter whether you actively use Twitter or not, as long as you listen to what others say there (which means you need to be paying attention: monitoring and then analysing what you find via such channels).

Good or bad, what tweeters say about you provides you with unfiltered opinion upon which you can act.

Download Maritz Research and evolve24 Twitter Study (PDF).

(Via Jay Baer’s Convince & Convert)

Famous last words

Posted on September 26, 2011 at 7:25 am UK

It’s probably no surprise to anyone that Oswald Gruebel, the CEO of Swiss bank UBS, quit his job on Saturday in the wake of the rogue trading scandal at the bank’s London office.

That alleged crookery looks like will cost the bank its anticipated profit for at least Q3, no bonuses for employees who would normally expect them, and a hole in the balance sheet of $2.3 billion (£1.5 billion / €1.7 billion) or more.

So the CEO fell on his sword. He’s quoted in UBS’ September 24 press release as saying:

[...] Oswald Grübel feels that it is his duty to assume responsibility for the recent unauthorized trading incident. It is testimony to his uncompromising principles and integrity.

This is the same man who was reported on September 18 saying:

[...] "I’m responsible for everything that happens at the bank," Mr Gruebel told Swiss Sunday newspaper, der Sonntag. "if you ask me whether I feel guilty, then I would say no."

That statement looked odd when I first read it. Maybe something got lost in translation, I thought (as did others). It reads like responsibility, yes, for the consequences, no.

Reality bit.

Related post:

When a UBS headline doesn’t tell you a story

When a UBS headline doesn’t tell you a story

Posted on September 15, 2011 at 4:22 pm UK

I’ve been following developments today in the UBS $2 billion rogue trades scandal – and the latest news re an arrest of the alleged rogue trader in London today – which could lead the Swiss bank group to report a financial loss for the third quarter of 2011.

Visiting the UBS online newsroom, I was puzzled by an entry posted this morning entitled simply ‘Media Release’ as you can see in the screenshot:

Click on the ‘More‘ button, and you see this:

The ‘More’ button reveals this text:

Zurich/Basel, September 15, 2011, 08:54 AM

Media Release

UBS has discovered a loss due to unauthorized trading by a trader in its Investment Bank. The matter is still being investigated, but UBS’s current estimate of the loss on the trades is in the range of USD 2 billion. It is possible that this could lead UBS to report a loss for the third quarter of 2011. No client positions were affected.

Extraordinary – it looks very much like whoever wrote or published the news release was trying to hide the information behind a generic headline, perhaps hoping no one would really notice it. Look at all others releases in the UBS online newsroom – normal story titles as you’d expect. All but this exception.

No doubt there’s an innocent reason such as I’ve speculated. Yet there could be serious consequences nevertheless from this behaviour, perhaps in areas related to full and fair disclosure of information likely to affect the share price or otherwise affect investors’, shareholders’ and the wider financial community’s trust in the company, not to mention customers’.

And I’d be surprised if there weren’t Swiss or US financial industry regulatory matters that would embrace this, given that the company’s shares are listed on stock exchanges in Switzerland and the USA.

It adds up to a reputation crisis at the very least.

[Update Sept 16] Some of the repercussions I’ve seen reported since yesterday:

Financial Times Sept 15: Trader hinted at turmoil in Facebook posts

When Kweku Adoboli typed a short update on Facebook last Tuesday, he might have been referring to troubles other than a mounting trading loss at UBS.

“Need a miracle,” he wrote.

But the idea that it may have meant the 31-year-old knew he was in trouble provoked pity and shock among friends and acquaintances on Thursday, after he was arrested in connection with a $2bn fraud at the bank where he was a trader.

BBC News Sept 16: UBS did not notice Adoboli’s £1.3bn loss

[...] The disclosure that it was Mr Adoboli’s decision to inform his colleagues of his actions that set alarm bells ringing at UBS, rather than its own monitoring system, will add to concerns that investment banks simply aren’t capable of controlling the huge risks that their traders take.

UBS estimates that Mr Adoboli’s alleged unauthorised trading will cost the bank around $2bn (£1.3bn) and will more than wipe out the giant bank’s profits in the current three-month period.

If Mr Adoboli had not revealed his activities on Wednesday, in theory the final bill for UBS could have been even bigger.

Financial Times Sept 16: UBS bankers face zero bonuses

[...] Hundreds of UBS bankers could receive zero bonuses this year following the revelation that a 31-year-old trader at the Swiss group is suspected of losing $2bn through unauthorised trades.

[...] Analysts said that while UBS has enough capital to withstand the financial impact of a $2bn hit, such a massive trading loss could effectively wipe out any profits from its investment banking operations for 2011.

Over the first half of the year, UBS has earned a pre-tax profit of SFr1.2bn ($1.37bn) in its investment bank unit, headed by Carsten Kengeter.

A $2bn trading loss, which UBS said could push the entire group into the red for the third quarter, means the investment bank is sitting on a $650mn hole.

Expecting more bad news to emerge in the coming days.