How Obama’s data-crunching prowess may get him re-elected

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Alone among the major candidates running for president, the Obama campaign not only has a Facebook page with 23 million “likes” (roughly 10 times the total of all the Republicans running), it has a Facebook app that is scooping up all kinds of juicy facts about his supporters.

Users of the Obama 2012 – Are You In? app are not only giving the campaign personal data like their name, gender, birthday, current city, religion and political views, they are sharing their list of friends and information those friends share, like their birthday, current city, religion and political views. As Facebook is now offering the geo-targeting of ads down to ZIP code, this kind of fine-grained information is invaluable.

Inside the Obama operation, his staff members are using a powerful social networking tool called NationalField, which enables everyone to share what they are working on. Modeled on Facebook, the tool connects all levels of staff to the information they are gathering as they work on tasks like signing up volunteers, knocking on doors, identifying likely voters and dealing with problems. Managers can set goals for field organizers — number of calls made, number of doors knocked — and see, in real time, how people are doing against all kinds of metrics.

In additional to all the hard data, users can share qualitative information: what points or themes worked for them in a one-on-one conversation with voters, for example. “Ups,” “Downs” and “Solutions” are color-coded, so people can see where successes are happening or challenges brewing.

And unlike an open social network, where everyone is equal, NationalField runs on a hierarchical social graph: Higher-level staff get a broader view of the state and local work below them.

For a campaign that tapped the volunteer energies of millions of people in 2008 and appears to need all the help it can get in 2012, these kinds of fine-grained technologies could make a key difference. While the Republican field (and bloggers and the press) has been focused on how their candidates are doing with social networking, Obama’s campaign operatives are devising a new kind of social intelligence that will help drive campaign resources where they are most needed.

‘Data harmonization’

It all sounds like common sense, but actually, connecting and synchronizing the data a campaign collects from its field operation, fundraising operation and Web operation isn’t a trivial task.

“The holy grail of data analysis is data harmonization, or master data management,” Lundry said. “To have political talking to finance and finance talking to field, and data is flowing back and forth and informing the actions of each other — it sounds easy, but it’s incredibly hard to implement.”

Most political campaigns tend to rely on consultants to carry out part or all of these functions, resulting in even greater obstacles to sharing information.

Like Lundry, Republican technology consultant Martin Avila is worried. His firm, Terra Eclipse, built Ron Paul‘s 2008 Web operation and works closely with the tea party movement. This year, it did some work on Tim Pawlenty‘s website until that campaign folded.

Avila’s flagship project is a conservative social-networking hub called Freedom Connector, which has grown to 150,000 members in a matter of months by giving right-wing activists tools to organize local meetings and discussions. Avila doesn’t think any of the Republican presidential campaigns fully understand the power of data today.

“They have to stop seeing a website as a piece of direct mail that people will receive,” he said. “They have to see a website as the equivalent of a campaign office in Iowa, one that is open 24/7.” And campaigns need to know how to take quick and well-targeted action to respond to every expression of interest they may get online, he argues, because voter interest in politicians is fickle. Simply sending a generic e-mail reply isn’t enough.

“If you can make that initial response a phone call from someone in their town or a neighbor, asking them to come to a county fair tomorrow, that’s much more powerful.”

Power of personal connections

Without good data management, the different legs of a national campaign can trip over each other.

“One hand doesn’t know what the other hand is doing quite often in campaigns,” Lundry said. “With master data management across a campaign, you can see how often you’re talking to a person” and thus not bombard them with untimely or poorly targeted requests.

But, according to Avila, “Not many on the Republican side know how to technically accomplish that.” Their approach to the Web, he adds, is still too much shaped by pre-Internet politicking using broadcast advertising. “The ability to connect to people on a one-to-one basis, and encourage them to connect with one another, is way more powerful than that.”

How powerful? The 2008 Obama campaign offered an early glimpse of the potential of data-driven politics. By the end of the election, it had amassed 13 million supporter e-mail addresses, collected nearly 4 million individual donations and tallied about 2 million registered users on my.BarackObama.com, the campaign’s social networking platform. Seventy thousand myBO members had used the site to conduct their own personalized fundraising campaigns.

Since 2008, enthusiasm for Obama has waned, but his online presence hasn’t. His base on Facebook has soared nearly six times from the 4 million he had on Election Day, and his following on Twitter now stands at 10 million, dwarfing the Republican field.

So even if Obama isn’t drawing millions of people off their sofas to rally to his side on their own in 2012, his team has a huge amount of raw data to work with as they build his re-election machine.

If the 2012 election comes down to a battle of inches, where a few percentage points change in turnout in a few key states making all the difference, we may come to see Obama’s investment in predictive modelers and data scientists as the key to victory.

Alone among the major candidates running for president, the Obama campaign not only has a Facebook page with 23 million “likes” (roughly 10 times the total of all the Republicans running), it has a Facebook app that is scooping up all kinds of juicy facts about his supporters.

Users of the Obama 2012 – Are You In? app are not only giving the campaign personal data like their name, gender, birthday, current city, religion and political views, they are sharing their list of friends and information those friends share, like their birthday, current city, religion and political views. As Facebook is now offering the geo-targeting of ads down to ZIP code, this kind of fine-grained information is invaluable.

Inside the Obama operation, his staff members are using a powerful social networking tool called NationalField, which enables everyone to share what they are working on. Modeled on Facebook, the tool connects all levels of staff to the information they are gathering as they work on tasks like signing up volunteers, knocking on doors, identifying likely voters and dealing with problems. Managers can set goals for field organizers — number of calls made, number of doors knocked — and see, in real time, how people are doing against all kinds of metrics.

In additional to all the hard data, users can share qualitative information: what points or themes worked for them in a one-on-one conversation with voters, for example. “Ups,” “Downs” and “Solutions” are color-coded, so people can see where successes are happening or challenges brewing.

And unlike an open social network, where everyone is equal, NationalField runs on a hierarchical social graph: Higher-level staff get a broader view of the state and local work below them.

For a campaign that tapped the volunteer energies of millions of people in 2008 and appears to need all the help it can get in 2012, these kinds of fine-grained technologies could make a key difference. While the Republican field (and bloggers and the press) has been focused on how their candidates are doing with social networking, Obama’s campaign operatives are devising a new kind of social intelligence that will help drive campaign resources where they are most needed.

‘Data harmonization’

It all sounds like common sense, but actually, connecting and synchronizing the data a campaign collects from its field operation, fundraising operation and Web operation isn’t a trivial task.

“The holy grail of data analysis is data harmonization, or master data management,” Lundry said. “To have political talking to finance and finance talking to field, and data is flowing back and forth and informing the actions of each other — it sounds easy, but it’s incredibly hard to implement.”

Most political campaigns tend to rely on consultants to carry out part or all of these functions, resulting in even greater obstacles to sharing information.

Like Lundry, Republican technology consultant Martin Avila is worried. His firm, Terra Eclipse, built Ron Paul’s 2008 Web operation and works closely with the tea party movement. This year, it did some work on Tim Pawlenty’s website until that campaign folded.

Avila’s flagship project is a conservative social-networking hub called Freedom Connector, which has grown to 150,000 members in a matter of months by giving right-wing activists tools to organize local meetings and discussions. Avila doesn’t think any of the Republican presidential campaigns fully understand the power of data today.

“They have to stop seeing a website as a piece of direct mail that people will receive,” he said. “They have to see a website as the equivalent of a campaign office in Iowa, one that is open 24/7.” And campaigns need to know how to take quick and well-targeted action to respond to every expression of interest they may get online, he argues, because voter interest in politicians is fickle. Simply sending a generic e-mail reply isn’t enough.

“If you can make that initial response a phone call from someone in their town or a neighbor, asking them to come to a county fair tomorrow, that’s much more powerful.”

Power of personal connections

Without good data management, the different legs of a national campaign can trip over each other.

“One hand doesn’t know what the other hand is doing quite often in campaigns,” Lundry said. “With master data management across a campaign, you can see how often you’re talking to a person” and thus not bombard them with untimely or poorly targeted requests.

But, according to Avila, “Not many on the Republican side know how to technically accomplish that.” Their approach to the Web, he adds, is still too much shaped by pre-Internet politicking using broadcast advertising. “The ability to connect to people on a one-to-one basis, and encourage them to connect with one another, is way more powerful than that.”

How powerful? The 2008 Obama campaign offered an early glimpse of the potential of data-driven politics. By the end of the election, it had amassed 13 million supporter e-mail addresses, collected nearly 4 million individual donations and tallied about 2 million registered users on my.BarackObama.com, the campaign’s social networking platform. Seventy thousand myBO members had used the site to conduct their own personalized fundraising campaigns.

Since 2008, enthusiasm for Obama has waned, but his online presence hasn’t. His base on Facebook has soared nearly six times from the 4 million he had on Election Day, and his following on Twitter now stands at 10 million, dwarfing the Republican field.

So even if Obama isn’t drawing millions of people off their sofas to rally to his side on their own in 2012, his team has a huge amount of raw data to work with as they build his re-election machine.

If the 2012 election comes down to a battle of inches, where a few percentage points change in turnout in a few key states making all the difference, we may come to see Obama’s investment in predictive modelers and data scientists as the key to victory.

Nail Art Advertising

TrendCentral: KIA Motors recently tapped into the nail art trend to promote their “smALL” sized KIA Picanto, proving that one really can pack big things into compact spaces. The auto maker created a stop-motion ad campaign that caught the attention of some hip folks. Being the first-ever nail art stop motion is pretty impressive, but what’s even more noteworthy is that it took only 25 days to create this masterpiece. Each nail took two hours to paint, using 1,200 bottles of nail polish for a total of 900 fingernails. Working out the math, that equals one outstanding piece of advertising that has really nailed its target market.

Using Quick Response Codes to Promote Your Business

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Fatheadz has long used race car sponsorships to promote its line of oversize sunglasses. But because racing fans didn’t often connect to his website while at the track, Chief Executive Rico Elmore felt he was missing a marketing opportunity. After learning about Quick Response (QR) codes earlier this year, he slapped some of the squiggly squares on the Fatheadz autograph cards he hands out at races. Now, fans with smart phones use them to get information instantly about their favorite drivers—and a look at Fatheadz’s glasses. Although data is still coming in, Elmore says, June is shaping up to be the Indianapolis company’s best sales month ever.

Quick Response codes were developed about 15 years ago, but they are just starting to be adopted by small U.S. companies like Elmore’s, says Jared Smith, CEO of Talent Evolution, a digital marketing consultancy in Laguna Niguel, Calif. Smith spoke recently to Smart Answers columnist Karen E. Klein about using the codes.

Karen E. Klein: Where did the QR code come from?

Jared Smith: It’s actually been around since the mid-1990s, mainly in Japan. In the U.S., they’ve popped into awareness in the last 18 months. People have started noticing them on products and in magazines.

I’m doing a lot of seminars and speaking about them because small business owners are starting to wonder how to leverage them.

How do they work?

They are actually 2D bar codes that you scan with your smart phone or other mobile device. You have to download a QR code reader; then you can use them to access all kinds of information, including web addresses, personal or professional contact information, or Internet landing pages. There are several QR apps you can download for free.

So you have to know a little about them, and you have to get the technology to be able to use them. Does that make them kind of exclusive?

Yes, you have to know a little bit to use them, but once you understand them, it’s very easy to learn more. I bring a QR code blown up to poster size to my workshops, and people are amazed. They always say, “I’ve seen that. What is it?”

What kind of awareness do you find among small business owners?

About 50 percent have no idea what I’m talking about. Another 50 percent are somewhat familiar with the technology. All of them want to know more, especially about how they can begin using them.

What’s the best way for small businesses to use them?

We recommend that our customers use them to drive people to a specific product or service, not just as a link to their website. When you’re using it for the first time, you need to educate people and include a call to action with it. Tell them what to do: “Scan this code and get more information” or “receive a discount.”

How do they best fit into an overall marketing plan?

They are great tools to leverage what you’re doing offline, say with a print ad campaign, or your business card, or product packaging. We’re going to start seeing more of them on television and websites, too.

The QR code can take someone to a specific landing page, like a video testimonial or your company’s Facebook page. One of the key things is to have the QR code provide an extra level of information. You want people to think this is going to show them something really cool.

You can also use the QR code as a tracking tool by tying it to a special promotion. For instance, we use one to promote our workshop, and we give those who scan it 25 percent off the price. That’s a great metric.

How does a company create one of these codes?

You use a tool called a QR code generator. Again, it’s free, and there are several different applications you can use to generate them. You plug in the URL where you want the code to go, and then you get an image of the code. You right-click on that and copy and paste it into your materials.

And if you’re using it on print material, you’d send the image to your designer or printer?

Yes, just make sure they test it. You don’t want thousands of copies of an ad going out with a code that doesn’t go to the right place.

The other thing you want to do is make sure the pages you link to QR codes are mobile-ready, so people can view them easily within their phone.

Karen E. Klein is a Los Angeles-based writer who covers entrepreneurship and small-business issues.

Why Food Startups Are Getting Hot

The U.S. restaurant industry grew by 1.4 percent in 2010, interest in new food co-operatives is at its highest level in 30 years, and sales of packaged ethnic foods are booming, fueled by adventurous Gen Yers raised on the Food Network. Even venture capitalists, long focused on technology startups, are grabbing plates and getting in line: Tech entrepreneur Jonathan Kaplan, creator of the Flip camera, reportedly snagged $10 in million in venture capital funding for his grilled-cheese restaurant concept, The Melt. For more than two decades, CPA Karen Burns has worked as a partner at San Francisco consulting firm Sensiba San Filippo to help startup entrepreneurs break into the food and beverage industry. The market may be sizzling—particularly for organic, sustainable products—but poses extra challenges to new entrepreneurs, says Burns. She spoke recently with Smart Answers columnist Karen E. Klein. Edited excerpts of their conversation follow.

Karen E. Klein: Are you seeing a lot of interest from entrepreneurs who want to break into the food industry?

Karen Burns: It has really increased within the last five years. I think what’s driving this trend are the many medical studies that are being done about issues like obesity in children, diabetes, and allergies. A lot of entrepreneurs are making products to help their customers with medical issues.

Gluten-free is an example. No one ever heard of these products just a few years ago. Now you can go into a major market and there’ll be an entire aisle with products that are gluten-free.

What basic advice do you give to people who contact you for help?

Know your product and do that product well. Don’t bite off too much, too early. Have a go-to-market strategy and be very successful with it before you expand. You can have a very tiny menu to start. You don’t have to have 18 different SKUs [stock-keeping units] of products that you’re selling.

Are you seeing venture capital funds get interested in food startups?

Definitely, especially within the last three to five years. An organization called the Pacific Community Ventures Fund is focusing specifically on the food and beverage industry. Now some other funds are cropping up that want to get in on it, too.

What other areas are particularly hot right now?

Ethnic food is big, particularly some of the Asian foods that have not traditionally been so popular in the U.S., like Taiwanese and Filipino. Being in the San Francisco Bay Area, there are so many Asian entrepreneurs who have come to our country in the last generation, all of them with family recipes. They locate in ethnic communities initially and serve people from their own niche, but eventually other people also want to try their menus and they take off in the mainstream.

What are the particular challenges of getting into the food business?

From day one, there are compliance issues: tax returns that need to be filed, even if you don’t owe anything; product ingredient labeling; health department inspections. Like any business, startups need to do budgets and take their cash-flow forecasting to banks and outside investors.

If you want your company to be able to market itself as environmentally conscious, there are green initiatives that you can use to get various certifications in different states. There are some credits you may be able to get for that from a tax perspective and some programs that you may be able to find on your state or local level to help you finance it.

What do you recommend for early startups that want to get their products consumed?

So many of them start at farmer’s markets, which is a great idea. Trader Joe’s and Whole Foods (WFM) walk the farmer’s markets looking for the next great thing. Of course, it can be a trap to get very wide distribution early on because the retailers’ demands are extensive and the margins are very thin. I tell clients to watch their overhead very closely if they do get picked up by a volume retailer.

What’s the funding picture like for small food companies?

I think it’s getting a little bit better. We’re starting to see that financial institutions have cleaned up their portfolios, bad debt is off their balance sheets for 2011, and they’re willing to take on some new risk. Also, there clearly is an awakening in the [venture capital] market to invest in this area.

A lot of food production companies are family businesses, however, and they don’t want to take on outside money. And all startup entrepreneurs should expect to have to personally guarantee the funding. That’s a hard nut—but from the financial institution’s point of view, if you’re not willing to stand behind your business, why should they?

As people are coming out of the recession and trying to get financing, I’m advising them that it’s okay to forecast a break-even quarter and then maybe have a slight profit. The bank would rather see you hit or exceed your forecast than have you forecast all roses and not hit it.

Q: Do you have any tax tips?

Definitely look to take advantage of [research and development] credits and enterprise zone credits at the federal and state levels. If you can locate your business in an inner city area, not only do you get tax relief but you might also get hiring credits and access to advisors that will give you low-cost or free consulting help.

If you’re doing research on making a new product or making your existing products better, you can claim the R&D credit. Even if your business is not making money early on, you can start capturing the data and claiming the credits because there are carry-forward provisions that can be used in the future.

If your company is doing its production domestically, you can file for something called DPAD, theDomestic Production Activities Deduction. You fill out a form that calculates what your deduction is, based on sales relative to domestic production. Companies that do everything domestically get a higher permanent deduction. It’s worth looking into.

Karen E. Klein is a Los Angeles-based writer who covers entrepreneurship and small-business issues.

Related articles

• Why Food Startups Are Getting Hot (foodforfuture.wordpress.com)
• What are the five stages of every Venture Capital deal? (hubtechinsider.wordpress.com)

Don’t Market to the Mirror

“I don’t watch TV.”

I can’t tell you the number of times I’ve heard those words from individuals running businesses or company divisions. While the claim is usually a bit of an exaggeration, I generally have no reason to doubt it. I’m not surprised that people who run successful companies have little time (or concern) for much of the mind-numbing programming that passes for entertainment these days.

That said, it would be a mistake for business leaders to conclude that because they don’t watch TV, nobody does. Most Americans don’t get up every morning with the burden of running a company on their shoulders. Most watch a great deal of television—an average of more than four hours per day, according to Nielsen. Any business leader who rejects the prospect of TV advertising (or direct mail, online video, mobile marketing, pay-per-click, or any other form of outreach) simply because of his or her personal preferences is making a mistake.

Yet it happens more often than you might think—particularly at small companies in which the chief executive officer must wear many hats. It’s easy to project your own thoughts, opinions, attitudes, and behaviors on the broader population, particularly people you believe would be good prospective customers. But while you might share some things in common with prospects, based on the industry in which you do business (a love of scuba diving, a belief in solar power, and so forth), there will always be fundamental differences—not least that you know and care much more about your business than even your most ardent fans do. You’re already sold, by definition. Your prospects, by definition, are not.

EMPATHIZE AND PERSEVERE

With that in mind, here are five common ways the “marketing to the mirror” mistake can manifest itself. See how many you have embraced.

The giant logo. Not only do you love your brand, you’re paying for the space and by gosh, you want to see a big, bright logo beaming from it. Your prospective customers, however, are either unfamiliar with your brand or have some incomplete or mistaken impression of its value to them. If they’re accosted by a giant logo before your marketing message has had a chance to get through, they may skip the ad and miss the point entirely.

The overstuffed ad. Have you ever heard a radio commercial in which the words go by so fast that you can’t process anything? Seen an ad in a magazine so riddled with bullet points that you don’t know where to begin? Or driven past a billboard loaded with so much copy that it would take binoculars and three changes of the traffic light to process? In advertising, as in many things in life, less is often more. Additional words do not always translate to better communication. On the contrary, they are likely to hinder it.

The magic slogan. Ah, the slogan: so misunderstood, so overappreciated. You and your team put so much time and effort into creating those three or five little words that they’re overflowing in meaning and packed with power—to you. To the rest of the world, they’re just three or five little words. They may make a nice ribbon to tie around your advertising package, but they’re not the package itself—and certainly not the prize inside. Don’t put more faith in a slogan you came up for your brand than you’d place in some words heralding someone else’s. (See “What’s in a Phrase?”)

The “my” buy. Who listens to jazz radio? Or classical music? Or that easy listening station that drones on in dentist offices and elevators? I don’t. But a lot of people do. If they didn’t, those formats wouldn’t exist. We all gravitate naturally to the radio stations we listen to, the TV programs we watch, the websites we visit, the newspapers and magazines we read, and the social networks in which we participate. There’s nothing wrong with advertising in places you personally frequent, as long as they’re good outlets to reach people you’re targeting. Just don’t make the mistake of thinking that because something is of interest to you, it’s of interest to them—or that because it’s irrelevant to you, it’s irrelevant to them.

The one-hit wonder. It’s likely that you find your ads quite convincing: one exposure and you’re sold. Alas, that’s not the way things work in the cluttered and cacophonous world of modern communications. My research among some of the most successful companies in the U.S. shows that those that enjoy the greatest long-term success tend to run campaigns for more than two years at a stretch. If you’re wondering why your new advertising isn’t setting the world on fire, it may be because it’s new. Every fire takes time to spread.

One of the most difficult things to do in marketing is to step out of your own shoes and into those of your customers and prospects. It’s a critical first step in effectively conveying your message. If you can sustain your business by preaching to the choir, go for it. But if you need to expand your customer base, recognize that what you do and how you think is not necessarily reflected in your target audience’s behavior. Look, listen, and feel through their eyes, ears, and hands and you might see more of their feet crossing your threshold.

Steve McKee is president of McKee Wallwork Cleveland and author of When Growth Stalls: How It Happens, Why You’re Stuck, and What to Do About It. Find him on Twitter and LinkedIn.