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What's Holding Back Corporate Blogging?

Why did the much-predicted 2005 stampede by corporate America into the blogosphere fail to materialize?

The number of Fortune 500 companies with strategic public blogging initiatives, after all, is still quite small -- somewhere between 3-4%, depending on how you figure it. Many of those firms are what you might call "the usual suspects" -- i.e., technology firms such as IBM, Sun and Microsoft that are enmeshed in network culture. And basically none of them are the sort of brand-name consumer powerhouses that could really push blogging and related customer-contact media into the mainstream of everyday business.

By itself, this delay is not surprising, especially when you look at the history of early corporate involvement with the Web a decade ago. When the World Wide Web first emerged in 1994, some pundits predicted the "imminent demise of the shopping mall" as name-brand consumer product firms rushed to set up online stores. In point of fact, it took four years for the dollar volume of online shopping to even hit the $1 billion mark -- in other words, to even reach half the size of the real-world market in blow dryers.

Change, it turns out, usually takes longer than the pundits predict. Especially change in the business world.

But it does beg the question: What are the factors or conditions that will drive mainstream American firms to truly embrace external public blogging -- whether for marketing, product development or other purposes?

I asked two authors of business blogging books -- Jeremy Wright and Debbie Weil -- for their thoughts on this question:

Jeremy Wright, a corporate blogging consultant and the author of Blog Marketing, named three factors holding back a stronger corporate embrace of blogging:

"First, these things take time. It never happens as fast as we imagine. Second, the software tools are in many cases still too immature for enterprise use. And third, a clear ROI (return on investment) from blogging remains to be demonstrated."

As for Debbie Weil, also a blog consultant and the author of the forthcoming The Corporate Blogging Book, she stressed the psychological roadblocks to corporate blogging:

"Fear is the single most important thing holding corporate America back from embracing blogging. Fear of being open, fear of a two-way conversation, fear of not being able to control the message, fear of the time commitment."

Wright and Weil make good points, to which I would add one more:

Blogging really is not for the faint of heart or the control freak -- two personality types usually thought to be well-represented in the ranks of management.

That's because, first of all, there really are dangers involved in tearing down the traditional barriers to direct customer interaction with the firm. There are a lot of angry consumers out there -- their anger fed by decades of having to deal with shoddy products, indifferent service, and the lack of corporate transparency and accountability -- and now, thanks to blogging, for the first time in history they can finally hit back. Just ask Dell, Sony, Kryptonite, Circuit City, and others whose brands, if not also their revenues, have taken a beating from the blog-fueled revolts of angry customers.

But just as important, blogging will ultimately force companies to abandon many of the traditional ways they have always managed not only their public affairs but their marketing and product development functions as well -- not least by giving customers a far more powerful and direct voice in enterprise decision-making than has ever been the case before.

In short, blogging requires firms to turn many of their operations inside out -- or, more accurately, to reverse the polarity of corporate thinking and practice from inside out to outside in.

Think about it: With notable exceptions, most large companies have always operated on a push-driven model, creating everything from their products to their marketing messages in-house and delivering them to what has always been (until now) a passive consumer marketplace. Now, thanks to blogging and other new developments, the transmission belt to the consumer is reversing direction, and marketing and new product insights will increasingly flow from the customer to the company.

That's a huge, epic change -- the sort of change that will require a lot of "tough love" for executives to embrace.

As Weil noted:

"If you put blogging in the basket of corporate communications it runs absolutely antithetical to so-called current best practices."

Ain't that the truth.

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Comments

Lots of times it depends on whether your customers use blogs.

Joining in on their existing blog-based conversations is an easy first step.

But a lot of the conversational drive has been towards selling "blogging" to corporations, which is quite a different thing. Lots of the tracking services, for instance, will tell you what others are saying, but won't help you join in yourself. Different scene, different incentives.

Good point, John.

Btw, doesn't macromedia make use of blogs not only for customer support, but for new product development as well?

I think control and ROI are definitely the top concerns.

At the end of the day if your market segment doesn't read blogs, then what's the use in having one?

It might feed your ego, but won't produce many tangible results.

You raise a really good question, Rick: Are there some firms whose market segments don't read blogs, and for whom blogging therefore wouldn't have much value?

The answer, I think, depends upon how we define blogs. What I mean to say is that, in a business environment, I think they're evolving beyond the iconic form of lone irascible voice pontificating on issues great and small into broader vehicles for direct customer contact.

So let's say you're a business-to-business vendor of air-conditioning equipment. Your end users may or may not read blogs, but probably your direct business customers almost certainly do not.

So would a blogging strategy have any relevance to you?

I think the answer is yes, if your strategy focused on developing a blog (or blog-like vehicle) that enabled air-conditioning vendors and repair businesses (your direct customers) to ask questions, give feedback, suggest new product ideas, etc.

And when it comes to consumer-product companies, I can't think of any that wouldn't benefit from developing some form of blog strategy that lets them know what customers are thinking and that enhances the brand trust that customers place in their products.

This is true even if the firm's customers aren't blog afficiandos.

Why? Because according to the latest research, the majority of all consumers now trust recommendations from their peers MORE than they trust all forms of advertising and news media.

Indeed, the vast majority of all Internet users (the majority of the US population) now search for peer-to-peer product recommendations online before making a buying decision. (This is especially true, of course, for high-information-content products like consumer electronics, vacation travel, etc.)

In short, American consumers are now listening more to each other than they are to companies and their marketing or advertising messages.

Given that conversations that affect your brand and your revenues are already happening out there, why not attempt to learn from and influence those conversations by developing a blog strategy?

But maybe I'm missing something. Can you think of a business that absolutely could not use blogs -- either public blogs or internal project management and collaboration blogs?

re: macromedia, blogs, "new product development"

Yes, I think so, at least in some ways... sometimes staffers write "how would you rank these features for a future version" kind of pieces, but an idea can come from a customer's weblog just as easily, and there's always a lot of back-and-forth in mailing lists too. Product development is part of the conversational mix.

On the Macromedia side, it was really the early use of blogs by influential customers, and the repetition of answering each hot issue in each venue in which it appeared, that prompted staffers to start weblogs too. If the customer base hadn't been so active in newsgroups, mailing lists and weblogs, then I don't know when we staffers would have adopted blogs too.

jd/adobe

I juset sent you an email asking if I could quote your last comment in a new book I'm doing on blogging and business. I thought it was really interesting.

I got an autoreply, though, which I really hope is not a problem for you. I was just trying to keep my request between us.

Sure, what I write is all in the public record, go for it, thanks.

I'd feel friendly towards a blogging air-conditioner vendor too, but what type of audience would they have, what types of posts might be of real use to that audience...?

Hell, I couldn't tell you in detail what sort of blogging posts would appeal to people in the air-conditioning equipment and servicing industry any more than I could tell you what sort of blog posts appeal to open source developers or perl programmers. But the latter read blogs in abundance.

Wherever there are markets, people are talking to each other about products, ship deadlines, service issues, inventory, employment conditions, R&D;, the weather, and life itself.

Anything that fosters communication and helps people solve problems is good for business. Generally speaking, blogs do that.

David,
Another thing that is holding back corporate blogging is the same thing that could accelerate its adoption: Whomever breaks rank and scores a big win will open the floodgates. As noted, because large corporates are risk-averse, they're not going to move unless they see proof that blogging provides a competitive advantage. So, if a shower soap manufacturer develops a new soap based on blog conversations and gets an amazing launch based upon that same conversation - it will get all other soap manufacturers' attention. It's the natural order of things in the business world.
Bloggers, of course, would like to see immediate adoption because it will validate their assertion that blogs are new customer interaction and promotional format. Plus, a lot of influential bloggers are now "blogging consultants" as well. Earlier adoption of this format means more revenues for them!
Relax. Keep evangelizing. And let the market come to you. It will come slowly as example after example will illustrate that blogs are growing as a necessary market communication avenue. Early corporate adopters will score some "surprising" early successes and will be featured on panels and in books. Marketing professionals will realize that they can earn a higher salary by being associated with this growing phenomenon.
Cheers,
TT

You are absolutely right, TechTrader.

The same process happened over the last 5-6 years with corporate America's adoption of patent strategy and warfare as a strategic advantage (the subject of my book "Rembrandts in the Attic"). A few high-profile wins and losses from the savvy deployment of patents against competitors -- the almost $1 BILLION judgement in the Kodak case, the $500 million "rembrandt" patent found in Honeywell's dusty files, etc. -- started the ball rolling. Now 90% of CEOs see intellectual property as a strategic component of executive planning (just look at Microsoft). 10 years ago it was probably 10%.

So thanks for that reminder about the way things work re: the adoption of new strategic imperatives.

By the way, being as how you're in the capital markets, how "real" do you think the recent acquisition binge by Murdoch and Yahoo et. al. of social software sites and firms will be as creators of major new value?

So, being a precise "finance" type, I have to parse your question in order to give you my best answer:

How "real" do I think the recent acquisition binge by Murdoch and Yahoo et. al. of social software sites and firms will be as creators of major new value?

Hmm...I don't think there is a blanket answer here. In Yahoo!'s case, I don't think it creates any new strategic developments -- it's just an extension and enhancement of what they're doing. Yahoo!'s business model is all about audience size and monetization through advertising and premium services. I think they acquired Flickr, Oddpost and Del.icio.us for two reasons:
1. They wanted to acquire the talent that understands how to leverage Internet powerlaws and the blogging phenomenon to create high-growth communities.
2. One of Yahoo!'s primary business metrics is the amount of time people spend within "their network". Moving that metric just a little bit to the plus side probably has a big effect on their advertising revenues > margins > EPS.

On the other hand, News Corp. suddenly noticed that the light at the end of the tunnel was getting brighter and realized that they're not on the train. They're planning on utilizing their mastery of media in this "new" channel. They're swimming in a whole different ocean now.
I actually think that old line media companies know a lot about generating compelling content and they'll teach all of the technologically-oriented start-ups a thing or two once they fully embrace the Internet as one of their primary delivery channels.
So, depending on how you define "real", and looking at each player, you get different answers. I'm not being coy; I just believe that it's hard to make blanket assessments about such a dynamic market with numerous and diverse players.
Cheers,
TT

Yeah, good point about examining each case on its own merits. We've seen this before, haven't we? Some players made smart moves in the early days of the web, others over-reached or saw "synergies" where there was just smoke and mirrors.

And I, too, will never count traditional media out. Having lived through the evangelistic hyperbolic frenzy of the early days of the web -- e.g., all that Gilderian baloney about how supposedly "Microsoft is dead!", "old media is dead," and "Hollywood is dead!" -- I'm a big proponent of "real-world" futurism.

Which means recognizing that technological possibilities are always shaped and constrained by social and economic realities (not to mention the limits of human nature).

Thanks again for your feedback.

Great post and comments. This has been a fun discussion to follow. I especially like what TechTrader has to say: "Relax. Keep evangelizing. And let the market come to you." I think companies who try to blog for blogging's sake will fail at it, while those who use the tools associated with blogging (lightning-quick publishing, comments, trackbacks, easy design, etc.) in creative ways will succeed.

I agree with the reasons given above why companies may be holding back from corporate blogging. I think the trend will accelerate as mainstream media report the financial growth of successful blogs and spotlight the positive effects they are having on different businesses.

For example, see this Forbes article from Jan. 24; it discusses the salvation of Indeed.com via blogging.

Thanks, Easton. And by the way, I had seen that Forbes article already because it quotes my coauthor and names my book.

Which, of course, makes it a terrific article.

I'd like to add another reason why we don't see more blogging from corporate execs.

They don't know what the hell to write. They may be high level administrators who sit before the computer and don't know what to say. Each day? Sometimes more that once?

That's probably not a desription of the marketing/PR types or many in product development. But I bet it describes a good part of corporate America.

Good point, Jonathan. But corporate blogging does not necessarily require CEO blogging.

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