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Top Social Media Mistakes that Companies Make

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Studies show that most people are using social media nowadays and 44% of small to medium-sized business decision makers use social media but are businesses using it the right way to build their online presence strategically? In many cases, they’re not. Here are the top 10 mistakes that companies make when using social media.

1. Not taking social media seriously

There are over 800 million people using Facebook, and over 200 million Twitter users –  not to mention, a similar number of folks on LinkedIn, and yet many businesses still dismiss social media as a flash in the pan.  Your business has the potential to take advantage of this massive online hub; ignoring it is a huge folly. You don’t have to start with a presence of your own if you’re not comfortable.  Using social media to listen to, and learn from, others in your industry can be a valuable research method, and it is also a great way to get a feel for how social media is used in your sector.

2. Ignore it and hope it will go away

Back in the early nineties when I sold Internet technologies, lots of companies weren’t convinced that the Internet would take off, so they ignored it and hoped it would go away. Many were left scrambling at the last minute to catch up online and some didn’t survive. A  hundred or so years ago many naysayers dismissed the phone. The same story is now replaying with regard to social media. Don’t stick your corporate head in the sand – social media isn’t going away and the sooner you accept that, the less risk to your business.

3. It’s only for small business

I’ve read a few articles recently that write off social media off as a tool that’s only useful for small to medium sized businesses. Many large, established businesses use this as an excuse because they have done things the traditional way for so long that they know no other way. However, pioneers like Whole Foods, Southwest Airlines and Ford are proving that social media can be a driving force for larger organisations too if it’s done right.

4. The Intern can do it

Many organisations get a young intern to maintain their social networks because this person has hundreds of Twitter followers, or is on Facebook all the time. However, just because you are familiar with using these tools socially doesn’t mean you know how to use them for business.  I am not saying an intern can’t do it, but you should make sure that they understand your goals, mission, audience, brand and such first so that they can represent you appropriately online.

5. Failing to consider company strategy

Point 4 leads me nicely to point 5 – not approaching social media from a strategic perspective. Only 8% of companies surveyed in a recent Forrester report are using social media in ways that tie in with their corporate objectives.  Again, companies often embark on using social media for the sake of using it rather than using it from a strategic perspective.  Before your company sets out on the social media path you should ask – who is your target audience, what is your message, which tools are right for your business given your brand and mission, and how can you use social media to augment your everyday activities. If you do that, your social media efforts are more likely to amount to something.

6. It’s all about you

In the old business world, marketing was all about corporations; all activities centred around the product and service, and not the consumer. Every message had to be vetted – which took time and meant the company was in control.  Many organisations take this approach to social media, and then wonder why they are spending lots of resources but have few results and little return to show for it. They aren’t succeeding because they need to re-engineer their approach. These days, it is not about you, but rather, it’s about your audience and every social touchpoint should reflect that. To be effective in social media you need to focus on your target audience, be able to move faster and to communicate in the moment before content gets outdated.

7. Blatant selling

This is the biggest faux pas you can make with social media. Never use social media to blatantly sell. It is okay to promote your offering, but in your face selling is off-putting. Here at Out-Smarts, we use the 80-20 rule – 80% of our posts are aimed at adding value, and only 20% are promotional.

8. Failing to set goals and objectives

As with any other business function, you should set goals and objectives before you start rather than haphazardly setting up your social shop  (as it were). What is it that you hope to achieve? You may want to build community with your target audience, extend your reach to new communities, use social media as a conduit to extend the reach of your content, drive traffic to your website, etc.  Whatever your goals are, you should document them, quantify them and make sure that they are achievable.

9. Failure to measure success

Many companies have no idea whether their social media presence is benefiting them or not, nor are they able to respond to what is being said about them online. Once you’ve determined your goals, you should put in place tools that allow you to measure your success and to listen effectively.  These might include free tools – for example; for web traffic analysis you can use Google Analytics, to measure your Facebook following use Insights, for Twitter use counters or paid tools like Radian6 that allow you to monitor and measure engagement.

10. Failing to take a holistic business approach.

Up until recently, many businesses have looked on social media as a stand alone approach rather than considering it as a way to complement and augment their entire marketing strategy.  2012 is going to be the year when the penny drops and companies realise that the best social media projects are those that complement their real world activities.

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About the Author

This article was produced by Out Smarts Marketing, a full service digital marketing company. Out-Smarts works with clients to plan, implement, manage and track smart online marketing initiatives that deliver results. see more.

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Entrepreneurship

Take the Money and Run: A Personal Startup Story

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IT WAS JANUARY, and the weather was bleak. It’d been freezing and overcast for as long as I could remember. Sometimes during winter in Akron, it feels like the sun sets in November and doesn’t rise until March.

It was late afternoon, and I was taking a break from hacking on some now-forgotten piece of code. Looking out the window of our “office” — really the second bedroom of our apartment where we’d crammed my desk — there was a foot of snow on the ground. Someone was trying to drive through the parking lot, their tires skidding back and forth on the thick layer of ice under the slush.

Taking a moment, I tried to remember when I’d last been out of the apartment, not counting trips to the grocery store. I couldn’t remember.


We’d started our first company, AgileZen, in late spring the previous year. We launched in July — July 7th, actually, for luck — and things had been going pretty well. We landed solid traction out of the gate, and people loved the product.

I was still pretty tired after grinding out the first version of the software, but I was having a great time. I grew up idolizing id Software and Nullsoft, and ever since I was a teenager, I’d wanted to start a software company. I’d spent the six years since finishing college working as a developer at various companies, but I was tired of executing someone else’s vision.

Zen was something that Niki and I had built by ourselves, without anyone’s permission, trying to cure a pain that I had personally felt. We were pleasantly surprised that it actually seemed to be valuable enough that people were willing to pay money for it. In fact, it was now making enough money that we weren’t burning any more of our savings.

To avoid spending money, we’d been subsisting on a diet consisting largely of soup. (Ramen, the stereotypical startup food, is dried via frying, making it pretty bad for you. Soup is cheap, healthy, and easy to make in large batches.) But now, we’d gradually started to feel like we might be able to afford to eat at restaurants again. I even bought some beer again, which we had considered an opulent luxury.

Anyways, things were looking good. We were still very small, but growing quickly. We had all kinds of crazy ideas on what we could build next. It was hard work, but exciting. A little bit of sunlight would have made me happier, but I couldn’t complain.

My computer dinged a familiar sound, letting me know that I had a new email. We didn’t have any employees, so an email typically meant that there was either a customer support request or a new sale. By now, the ding elicited a Pavlovian response, and I walked over to my desk to check.

Instead, it was an email from a corporate development guy at Rally Software. He wanted to schedule a meeting to discuss how we might be able to work together. Interesting.

I walked across the apartment to Niki’s desk. The office wasn’t quite large enough for both of us to comfortably sit, so she had set up camp in a corner of the living room.

“Did you see that email?” I asked.

Niki looked up and spun around in her chair. “Yeah, what do you think they want?”

“Dunno. Probably just want to talk about building an integration.”


We never built Zen with the idea that we were going to be acquired. We’d talked about it of course, but never more than half-seriously. It always seemed so far down the road that we didn’t give it any real thought. I just saw project management as a problem that needed to be solved, and it was frustrating that no one else had figured it out.

Just a couple of weeks before Rally reached out to us, we were at CodeMash in Sandusky. At the bar after the conference wrapped for the day, a colleague joked with us that the company he worked for (a major player in the project management market) should buy AgileZen. We laughed it off, but it was the first time I realized that selling the company might be a real option.

A few days after they contacted us, we had a conference call with the people from Rally. To our surprise, the CEO was on the call. I remember muting the phone and saying to Niki, “I don’t think this is about integration.” It quickly became apparent that they were interested in acquiring the company.

The idea that someone would be interested in buying our little company was flattering. We hadn’t even been in business for a year yet, and a multi-million dollar market leader thought what we were doing was good enough that they wanted to pay us a bunch of money and stock to have us do it for them instead.

We talked for an hour, and they bought us plane tickets to visit their headquarters in Boulder the following week.


On the way to the airport, we dropped our dogs off at Niki’s parents’ house. We were running a little late, and were in a hurry to make our flight. Walking back to the car, Niki slipped on the ice outside and fell, tearing the knee of her pants and scraping herself pretty badly.

This was strange; I’m usually the one getting randomly injured. Since we’ve been married, I’ve fallen down the stairs three times, once managing to spill coffee on the ceiling. When exercising, I’ve manage to twist my knee, ankle, elbow, and punch myself in the face not once but multiple times.

Kneeling on the ice, Niki looked at her knee and then to me with a look of sheer terror.

“We’ve  got this,” I said, helping her up. We rushed back home so she could bandage her knee and change clothes before racing to the airport. Fortunately the roads were well-salted, so by setting some land speed records — without drawing the attention of the state highway patrol — we made our flight.

We landed late in Boulder after dark, and the corp dev guy picked us up at the airport. We made small-talk as we drove from Denver to Boulder, and it was during this conversation that I first heard the phrase b-school spoken without being drenched in sarcasm.

We checked into the Hotel Boulderado, a restored historic hotel in downtown Boulder. After pacing around our room for a bit, we went downstairs to meet with Rally’s executive leadership team for dinner.

I was pretty nervous. We were just two kids from Akron that built this little web app to help people organize their work. Collectively, the people from Rally had something like 100 years of experience. Several of them had previous acquisitions, netting them significant personal wealth. Mostly, I drank a lot of wine and tried (unsuccessfully) not to sweat through my shirt.

We spent the entire following day at their office, meeting with a never-ending series of people from Rally. They explained to us what they thought the potential future of Zen could be, and we were struck with how similar their vision was to ours. They were smart, determined, energetic people, passionate about what they were doing, and driven by a higher purpose. I liked them quite a bit.

One thing that struck me as amusing is that throughout our conversations, they consciously avoided using the word acquisition — it was always merger. A clever attempt at flattery, which I appreciated in spite of its transparency.

After all of the meetings, the CEO came back to say that they wanted to meet, but that they wanted to make an offer to buy our company. We would hear from them in a few days once they put together the numbers. He thanked us, and we left for the airport.


A few days after we got back from Boulder, I was scheduled to visit Microsoft in Seattle. Just before I left, they called with the offer. It was reasonable — nothing ridiculous, but respectable, particularly considering our ARR had just barely cracked $70K. The payout was split between cash and a grant of stock up front, good compensation in terms of salary and two years of stay-pay bonuses for both of us, as well as stock options on a three-year vesting schedule.

By this point, Rally had raised $90 million or some exorbitant amount of venture capital, and were clearly near exit velocity where they could go public. We met with their CFO, who quickly won our confidence with his frankness and transparency with their finances and future plans. Between the salaries they were offering (starting at $135K for each of us) and the potential value of the stock, it was hard to look at our meager bank balance and not want to sell.

Not insignificantly, it also meant we could leave Akron. We knew we would miss our families back home, but after 27 years of Ohio winters, we were ready for a change. We weren’t keen on moving to Colorado, but strangely enough, they had an office in Raleigh, NC, where we already had several friends. It felt like serendipity.

All the financial incentives aside, we started Zen because we wanted to help people work together more effectively. We were convinced we were on to something with Zen, but we weren’t sure that we could take it to the next level. Getting access to Rally’s resources and reach meant that we might be able to get our product in front of more people, and increase our impact.

With all that said, one of the main reasons that we decided to sell was: quite simply, there were times when we felt like we had no idea what the fuck we were doing. We couldn’t shake the feeling that we were just a couple of kids in an apartment, buried somewhere under lake effect snow. These people were big time. They had deep pockets, lots of experience, and a strong understanding of the market.

So, we sold our company.

Due diligence took a month, during which I spoke at Microsoft’s MIX conference in Las Vegas. I was more than a little distracted, and my talk was a trainwreck. To my chagrin, I’m sure there’s visual evidence of it somewhere. I’ve never really apologized to Phil Haack, who was nice enough to ask me to speak at the conference, only to be presented with a huge shitshow. Sorry, Phil.

On the day the deal finally closed, we bought a $50 bottle of champagne and drank it together in our little apartment-office as the snow continued to fall outside. Just a couple of kids from Akron, but we were real-life entrepreneurs with an actual acquisition on our resume. We got calls from the press asking us questions. Investment bankers called us asking to manage our assets (which weren’t nearly as impressive as they undoubtedly thought). We felt like we’d made it.

Eventually, we’d come to learn how wrong we were, how hard the road ahead of us would be, and that selling the company would mean the end of what we’d worked so hard to build. But that night was for celebrating.

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About the Author

This article was written by Nate Kohari, a software engineer and an entrepreneur who co-founded AgileZen. 

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Knowledge

Lessons from LEGO’s Digital Economy

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Danish toy company Lego continues to ride the crest of the wave, despite stiff competition by mobile video games.

The Danish company is the second largest in its industry in terms of sales, surpassed only by Mattel, the manufacturer of Barbie, which in 2013 generated lower operating profits than its rival. These successful results were largely due to Lego’s digital economy, which has prevented the company from being pushed aside by new technologies. To examine its business strategy, the first thing to be  considered is that its audience consists of children.

While it’s true that construction games are also a challenge for adults, who can easily take part in the process, play with their children, and take an interest in their kids having fun with this type of toys (before other types of entertainment), the purchase decision is influenced by the demands of the children, and the company targets its efforts at them, as well as the nuclear family as a whole.

Lego’s video games

Lego launched its first computer video game, based on its physical games, in 1997. At that time, the PC had proven itself to be a powerful entertainment platform and was beginning to enter the home. Consoles were still an expensive option by comparison. Since then, the company hasn’t stopped releasing new games and has progressively added supports for its software development as new ones have started to become more popular.

lego’s digital economy

From Windows, it made the jump to Mac OS, and to video game consoles at the end of the 90s and early 2000s, including portable devices like the GameBoy Advanced and Nintendo DS. Lego’s objective has always been to be wherever kids find entertainment, instead of trying to use advertising spending, for example, to try to keep kids from changing their habits.

If kids are playing on the computer, then that’s where Lego breaks in, to position itself among the available play options. Of course, this isn’t the company’s primary business, but the visibility helps the physical games to sell better. Today, smartphones and tablets are the supports that have the biggest influence on children. For years, Lego has been releasing games for these devices, mostly for iOS, abut there are also a few available for Android.

All the mobile video games that are based on Lego’s physical games are free. There are other games that are centred around characters or worlds whose copyright does not belong to the company, like the Batman, Harry Potter or Lord of the Rings sagas. In these cases, the downloads are paid and there is only an iOS version. But in all cases, the main function of the video games is to spread the brand.

Perhaps the biggest challenge in Lego’s digital economy in this area is the video game Minecraft, which is based on building virtual structures with blocks, and will soon release its own movie, perhaps inspired by the ‘The LEGO Movie’ project. The movie was a success for Lego not only in terms of publicity, but also at the box office and among critics. It’s not a shoddy product; quite the opposite, it’s an adventure comedy with refined aesthetics, humour and charisma. It was so well received that the sequel is already being prepared for 2017. In this case, the objective was to generate affinity with the brand, especially with families, which was the film’s target audience.

lego’s digital economy

Unafraid of 3D printing

The popularization of 3D printers is making some companies afraid that their products will be able to be printed at home, giving rise to a kind of piracy that affects certain businesses, just as the creation of P2P networks did for the music and film industries. In response to these concerns, toy manufacturer Hasbro, which makes Transformers, signed an agreement with 3D Systems to allow some of its toys to be produced in the home. And Lego is thinking of taking a step in that same direction.

Lego’s CFO, John Goodwin, confessed to Financial Times just this year that 3D printing represents an opportunity for the company. He said that this technology opens up new paths and added that they are looking for a way to take advantage of it so that consumers can benefit. For example, they recently filed for a patent that allows the customization of the 3D-printed pieces.

Stimulating crowdsourcing among fans

Lego has an online platform where it invites its consumers and fans to upload their own ideas for physical products. If one of the proposals gets 10,000 votes, the manufacturer will consider whether or not it should be launched commercially. This initiative allows the company to be in constant contact with its most loyal customers and to enrich itself with their suggestions.

It also helps to create a circle of fans, which is decisive for a brand, both because of the fans’ loyalty and the publicity that they generate, which is of the best kind.

The manufacturer also has exclusive web content, such as Build with Chrome, which is an application that runs in the browser and allows the user to move and connect Lego pieces, simulating how it would be done in reality. The software offers a 3D environment adapted to the building of structures.

Innovation in toys

In addition to all these actions, Lego has also devoted its energy to innovation in toy manufacture. Robotics is one area that the company has been focusing on for years and its new kits have been expanded to include the latest technology, such as sensors. The company recently announced a project to connect its physical products to the virtual world of video games. Consumers will be able to build a structure and then take a picture of it with a smartphone camera to unlock a game based on the construction. This trial will be limited to the United States for now.

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