Plane Conversations

Every time someone posts something online the context of their content reveals an intent. Intentions have become transparent and discernment of intent is becoming the wisdom of crowds.

The aggregation of consumer conversations enabled by technology has fueled awareness of market methods and intents. Consumers have found influence and have begun to “opt out” of the old methods created by old market methods of intent to capture and sell.

Social technology has created a transparency of intent. Intent is a relational attribute that reveals motive. The “markets of conversations” are no longer motivated by old methods used by the markets over the last 40 years. Doc Searls says “The Intention Economy is built around more than transactions. Conversations matter. So do relationships. So do reputation, authority and respect. Those virtues, however, are earned by sellers (as well as buyers) and not just “branded” by sellers on the minds of buyers like the symbols of ranchers burned on the hides of cattle.”

A Brands Letter of Intent

A letter of intent or LOI is a document outlining an agreement between two or more parties before the agreement is finalized. Such agreements may be for employment, acquisitions, mergers, purchases of services or products. Agreements which aim to specify the intents of parties engaged in a relationship for specific purposes.

The purposes of a LOI may be:

• to clarify the key points of a complex or simple transaction for the convenience of the parties
• to declare officially that the parties are now engaged with an intent implied or specifically spelled out
• to offer safeguards for when the relationship collapses during an engagement with intent

A LOI may also be referred to as a memorandum of understanding (MOU), term sheet or discussion sheet. The different terms show different styles, but do not show any difference under law. Social letters of intent exist when and where buyers and sellers engage on-line through the exchange of information and later a transaction which has certain expectations of delivery.

Social Agreements Represent LOI’s

When people engage with other people or entire organizations on-line there is an implied social agreement represented within the communications. The social agreement may be in response to an inquiry, a comment on posted content or an intent to investigate or take action from an ad or marketing message. The social agreement may also simply be a response to a need or an exchange of communications centric to topical discussions.

Given the reach of social technology and the engagement of markets, buyers and sellers, the underlying social agreement is similar to the traditional letter of intent. While social agreements are not legal instruments the expectations of fulfillment by both parties remain the same as if they were legally agreements.

The very nature of social technology and the emerging dynamics are raising people’s expectation to fulfill implied intents contained in context with the content (communications). It is clear that traditional marketing and advertising methods are being rejected because the intent of such methods are not what buyers expect. Today’s buyers expect honesty, integrity, responsiveness, performance and respect for their time, attention and intentions.

Cluttering buyers time, attention and relevant intentions with irrelevant ads and slick marketing messages does not show respect. Treating buyers like cattle waiting to be herded does not show respect. The currency of communications represents the value of ones intent to fulfill or fail to fulfill the intent of a social agreement. Failure to fulfill a social agreement means the buyers currency, both in the form of money and communications, will not follow you rather both will be spent and shared elsewhere.

Social letters of intent are not created by or from the supplier rather from the buyer. To ignore or not fulfill these intents means you lose the buyers currency and that of their “friends”. That represents a return, or lack thereof, from this thing called social media.

Suppliers push products and services to market. People represent the pull for products and services through demand.

In economics, supply and demand describe market relations between prospective sellers and buyers of goods and services. The supply and demand model determines price and quantity sold in the market. The model is fundamental in macroeconomic analysis of buyers and sellers and of their interactions in a market.

Suppliers, manufacturers, service providers and distributors that have realized efficiencies in their supply chains – but that have struggled to gain similar returns from classic customer relationship management (CRM) solutions – are now increasingly embracing demand chain management (DCM) technologies to cut costs and optimize sales processes.

Demand Chain Management is the management of upstream and downstream relationships between suppliers and customers to deliver the best value to the customer at the least cost to the demand chain as a whole. The term demand chain management is used to denote the concept commonly called supply chain management, however with special regard to the customer pull.

The more widespread adoption of social technologies, combined with the challenging sales environment stemming from the conversational rivers enabled by the social web will cause selling organizations to heighten their focus on the demand side of the value chain.

What is The Demand?

Fundamentally the social web has enabled people to have a voice about anything and everything. When the lowest expectations about a product or service are not met the conversations swell like rivers and spread one to one to a million at the click of a mouse.

Tomorrows leading companies will have to engage people through the social web if they hope to fulfill the pull created by conversations. In doing so, they help themselves by acting on the conversations centric to speeding up cycle times, eliminating redundant activities, extending market reach, and most importantly, enabling buyers of all shapes and sizes with more choices and with greater input into, and control over, relevant business processes.

Many people are tired of companies controlling the conversations about their products and services. The old tricks of the trade are no longer tricks but obvious ploys for people’s attention and the people aren’t buying the tricks anymore.

The old theories of supply and demand have been centric to microeconomics. The new theories will become centric to conversations and the impact said conversations have on markets and the subsequent economics of those markets. The people are now in control of the conversations they want to have, the questions they want answered, the products they want made, the services they want to have and most of all the quality they need. If existing markets aren’t listening and participating they will likely be replaced by those that do.

As the social web becomes more “open” with less walls created by silos the conversational rivers created by the people will become more connected and more influential over markets. The demand on businesses will be for higher quality of service and performance and hiding behind slick marketing messages will become more and more transparent and irrelevant. The shift from supply to demand will have profound effects across every business segment and demographic imaginable.

Demand side economics is a chain controlled by the customer. The larger the chain the greater economic influence over markets. Doc Searls’ VRM vision is to enable more power and influence from the demand side of the supply chain.

Lets admit it. Everyone is in pursuit of fame. Whether it is being adored by your family, friends, associates or main stream media, fame makes us feel good. Some know how to create fame and some simply don’t. As more and more people engage with social media feedback from friends, retweets of blog post, comments, connections and traffic illustrate a degree of fame. Whether we admit or not all these things fuel our own perception of “being famous”. It is simply the dynamics of predictable human behavior. We read how others have leveraged social media to gain attention, attraction and an audience. We hear about success stories from people previously unknown but have become known because of what they did with social media. The lessons learned is that fundamentally the more people whom you attract, the larger the audience of readers and viewers then the higher the likelihood that your fame will grow. That is if you are giving something of value to your audience. What Does An Audience Value? There are all kinds of different audiences seeking information, knowledge, relations and opportunities. However ever audience has a common thread of connectivity which is relational. Relational in the sense that someone has something of interest to somebody looking for something. Audiences look for all kinds of things and traditionally fame was achieved by those that attracted the largest audiences to their personality, content, product, service or message. Said attractions received attention from main stream media which just fueled the fame with exposure to larger audiences. This process is changing given the power of social technology.  Technology has enabled individuals and organizations to create their own audiences using content in context with an audiences interest.  The small are learning to create their own fame while the BIG are trying to hang on to fame. Fame creates a draw but the qualities of fame are shifting. The word fame implies the state or quality of being widely honored and acclaimed as well as favorable public reputation. Historically fame was achieved by movie stars, music artist, politicians, CEO's of major corporations and on-profit causes and initiatives. The fame achieved by these individuals was propagated by the media which not only created their fame but enhanced their stature to the masses of consumers who idolized the accomplishments, the adoration and money that seemed to follow fame. Today things have changed and fame is no longer limited to the few rather the many. Fame is now gained from originality.  Fame comes from character and affinity to an audience of people who are drawn by the characteristics of a person or crowd. Audiences are people and the shift in media sentiments is tapping into the basic human fabric, trust. Trust is shifting because influence is shifting. The old days of tricking people with messages, spin and trapping them into a transaction is dieing a slow death. Old media tricks and methods are being rejected by the masses.  The biggest change which impacts the traditional means of achieving fame is that of public trust and confidence. Trust and confidence has traditionally been created by mass media which historically has been contained by the few. Today "new media" is now engaging and enabling the many to create and influence market sentiment about anything, everyone and everything. This "new media, or social media", has empowered the many to create their own stories, publish their own opinions and create their own on-line videos. Fame is no longer limited to the few but open to the masses to achieve. Fame is now achieved by what you do and the value it creates for others. It is no longer limited by your economic status or coverage by main street media. If he word fame implies the state or quality of being widely honored and acclaimed as well as favorable public reputation then what is happening on-line is a road to fame for many rather than the few. This new form of fame doesn’t require millions of followers rather just a small crowd. The small crowd now has reach and  is becoming the major influence over market sentiment about everything. The few are in fact becoming the many and fame follows them at the click of a mouse. Got fame? Use it wisely. Related posts:

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Everyone has assets. But we’re not talking about typical balance sheet assets rather we are talking about assets that lie within each of us. Said assets represent capital that we share everyday. Whether it be sharing what we know and have experienced (intellectual capital), sharing the relationships we have and those experiences (social capital) or sharing ideas about how things could be better or a problem could be solved (creative capital), the combined three represent human capital untapped. Today’s on-line categorization of our assets rest in silo’s of information. Our resume, our relationships and our ideas are all contained in silos of information. No one has yet synchronized all three human assets and indexed them into a taxonomy of “knowledge assets” which could be used by the community. Imagine what could happen if our searches were more relevant and relative to finding “assets” that can help us create more value.  If these collective assets were indexed into a taxonomy that provided relevancy to needs, wants and desires the possibilities would be limitless. Dan Robles writes: Our culture organizes itself around winners and losers. Corporations reflect this competitive nature to the core of their Capitalist doctrine. Sports analogies abound across the enterprise straight through to the HR department always on the lookout for the most amount of superstar for the least amount of money. Social media has every industry trying to understand the concept of community. Among the most difficult ideas to grasp is that knowledge assets in a community live on a bell curve, not in winner and loser columns. Everyone is an expert at something and nobody is an expert at everything. Someone who is not performing adequately is simply a misallocated asset, not flotsam subject to jettison at the next layoff or outsource "opportunity". Like most assets, there is a perfectly legitimate market for everyone in a community – nobody need be excluded, marginalized or laid off. Social Media is turning the tables on the hierarchy and old winners who don't play by the new rules quickly become the new losers. Maybe we ought to run our economy like a community instead of losing so badly at trying to be a winner. Related posts:

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(Originally posted on The Relationship Economy) America, the wealthiest nation on the earth, or it used to be. In the 200 year history of the United States of America the capitalist system created industries, wealth, leaders, politicians and social capital leveraged around the globe. First we built things and others consumed what we produced. The others produced things and we consumed what they built. Every supporting system was designed around production and consumption. Education, health care, manufacturing, government and society followed the mindset of either produce or consume. Everything was good for a while then things changed. The global economy changed. Technology changed, society change and politics went on as usual. In essence we are falling behind our social development because intentions have changed. Time to Move On Dan Robles writes: America is stuck in the Industrial Revolution. A loose paraphrase from Seth Godin points out "our entire education system is designed to prepare people to work in factories, consume stuff, and believe this makes us happy" Now that the factories are gone and the rest of the World has copied all of our tricks (while not copying our mistakes) it is time to move on. What is that next watershed economic paradigm? Who is going to figure this one out? The one who does will define the new meaning of "A Most Developed Country." Related posts:

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When it comes to air travel today, no one enjoys it.

Is There A Better Way?

Watch the video below and give this alternative some thought the next time you think about using a commercial airline. This alternative would have enabled me to go to New York City and back within the same day.  Total travel time would have been roughly five hours instead of 18.  And it would have cost me less!

“Clients of an organization, whether they are citizens or customers, now have ready access to these tools. For all the supposed decisiveness of managed organizations, by relying on legal and PR departments to respond, most companies now react more slowly than their customers. In the new world we’ve entered, you can only stonewall things on your side of the wall, yet most media is no longer on that side of the wall.”

Strategy is Now Driven From the Other Side of the Wall

Creating a road map of how your organization will succeed is now a process driven by the conversations from the market. Previously strategy did include an assessment of the market but limited by the perspective and terms of how one defines “the market“. The definition of market has changed in that consumers and business are now engaged in defining the market more than ever before. The definition and sentiment of a market are being framed by real time conversations about anything, everything, anyone and everyone.

Market sentiment used to be contained within the walls of a corporation. Complaints were reviewed as were compliments. Compliments were added to the marketing mix while complaints were buried until results reflected the need for change.

Today both complaints and praises are in real time and out in the open for everyone to see. Anything placed on the web enters the digital library and the more content that references your business the more visible it is the Google. The higher the visibility the easier it is to be found by others.

Before making a purchase or taking a job what do people do? 95% go the web to gather references and intelligence. Said references and intelligence are no longer driven by your media rather they are driven by media created by your market.

If you understand the power of a network then you know that three satisfied customers may tell three friends and those three friend may tell twenty seven then you know the power of the coice of the customer has just been accelerated by the web. The same is true about angry customers. One angry customer can reach 3,000 people at the click of a mouse. Those three thousand can reach over 100,000 given the power of networks.

The web works based on a rate of change and a rate of interest. Which gets you the highest rate? Satisfied or angry customers? Do the math.

Strategy is critical for any business but if you are following old strategic methods then you will fail critically. Today failure is instantaneously spread at the click of a mouse. The markets of conversations spread faster than most organizations can react. Building a strategy from the outside in is vital to your future success. When markets change so must your strategy. Much has to change starting with your thinking. Get it?

Sometimes we wonder why people don’t understand what we are saying. Lots of time people wonder what are we saying. In these instances there is a gap in understanding who is communicating what and why.

Understanding comes from knowledge. When we talk to people who have specific knowledge about something that we don’t have sometimes it is difficult to put the conversation into context. Most of us try to put new knowledge into context with old knowledge we have. It doesn’t work.

The Mind Frame of Private Aviation

Ever had someone view a problem differently than those who have the problem? When you are not close to a problem sometimes your perspective sees things that those close to it can’t.  The reason is that paradigms, beliefs based on experience, become barriers to seeing things differently and, more importantly, paradigms inhibit innovation.

The news from private aviation and aviation in general is depressing. Airlines losing money, private aviation is upside down and inside out. If you haven’t noticed, many are believing things are as bad as they seem and communicating “bad news” to each other. Bad news begets bad news which reinforces beliefs that just propagate more bad news. On the other hand some ignore “bad news” and choose to believe it is only temporary and that good times will be back soon.  Then the harsh reality hits and the only reaction is “cut cost” so we can survive.  Sound familiar?

A Shrinking Market Doesn’t Expand

Have you seen the latest report from NetJets?  Not good, major cuts and reductions. This seems to be the flavor of the day and subsequently we will see many more doing the same. Why? Because the old market you’ve been serving is indeed shrinking and not likely to come back. So when a market shrinks you have basically two choices. Shrink with it or expand your market.

To expand a market you need two things. Innovation that improves your offering and a market that will consume your offering. Now when it comes to air travel there is an obvious market of consumption that is being fed by commercial airlines. Yet the experience created by that market is at an all time low.   The idea of commercial airline innovation is representative of what Southwest has done. Yet Southwest cannot effectively serve the entire market and the experience is still dreadful.

Improve & Innovate Private Aviation

As I watch and read the events unfolding in private aviation the solution seems obvious to me. Then again, I am outside the industry but that could be a good thing. As a strategist I see several things that must change in order for the private aviation industry to not only survive but thrive. These are:

1. Expand your reach. Most travelers have never experienced and are unaware of the value and benefit of private aviation. This means you must communicate but do so in the terms markets can understand. You must also become relational. In other words - drop the elitist attitudes.
2. Leverage technology. Technology is exploding daily. The technology is social in that it enables you to reach markets like never before. But the technology is only as good as your knowledge of how to use it effectively and efficiently.
3. Collaborate Rather Than Compete: If you all are chasing the same old market and that market is shrinking, then to expand, you must collaborate. Competing for a smaller pie means you all get less. Collaborate and expand your collective market by using knowledge about new models, methods and markets ripe for an alternative to commercial travel. This will require new thinking and that will require new knowledge. Learn together.
4. Innovate or Die:Let’s face it. Your model doesn’t work. Your capital is shrinking and you’re facing a slow but obvious decline. Innovation comes from thinking outside your existing system and working together to create new markets, new models and increased revenue for all. Innovation doesn’t come from silo mentality. It comes from collaboration and ideation. What is that? It comes from “collaborating with crowds.”
5. Don’t Wait For Tomorrow: A sense of urgency is needed and the current market ought to give you enough urgency to do 1 -4 above immediately. Tomorrow isn’t likely to bring you the markets you want, rather, they are waiting for you. The markets are waiting for you to change, move and communicate like never before.

If you are ready, say so. If you are not, well then, stand aside and let those that are change their minds and thus change your industry.

Private aviation is feeling the effects of the economic downturn with growing job losses and plummeting business confidence. This has translated into cuts in private aircraft usage; so, many in the private charter brand category are looking for ways to reach the business market in a more cost-effective way. In a departure from traditional marketing practices, private aviation brands ought to be  increasingly turning to the web for promoting their proposition as well as seeking out new audiences that would like to find alternative ways to travel. The problem is that although private aviation businesses all have web presences now, many fail to realize the full potential of this new thing called social media.

Since private aviation is considered a luxury, one wonders whether  other luxury brands are using social media. According to the Luxury Institute the trend towards e-commerce is already happening in the US:

• In 2008, 33% of luxury brands had e-commerce sites.
• In 2009, 66% percent had e-commerce sites.
• Luxury consumers are individuals who make $419,000+ per year.
• 48% of them are on Facebook, and 14% of them are on Twitter.

How Does Private Aviation Stack Up?

While all private charter businesses  now have established websites, generally their approach to digital marketing (specifically, search, social & target marketing) is often sub-optimal and fails to unleash the full potential of this channel and the related technology. This is because the aviation industry has failed to educate itself as to the power of this thing called social media.  This is evident by:

• Insufficient senior management buy-in (e.g. formal corporate KPI’s for digital marketing)
• Organizational ‘silos’ causing disconnects between ‘digital initiatives’ and ‘physical initiatives’ – for example the industry continues to use old media channels and chases the same old audience rather than trying to expand the audience.
• Lack of clarity around the objectives (selling vs branding vs engaging) – this then reflects as a lack of an online strategy, leading to confusion and a total lack of knowledge and understanding
• Small marketing budgets, if any, allocated for online activities while still using expensive off-line channels to message a shrinking market of listeners
• Within the online budget, poor use of distribution tools and conversational content. The Aviation Industry needs education on various other channels that would produce much better outcomes (such as search and social).
• A tendency to consider this thing called social media as something buyers of charter service don’t use. Wrong again, the largest adoption of this new technology is from people in the age bracket of 45 – 55 and their average income is in the high six figures.  Does that sound like a market operators should reach?

From my prospective, while the private aviation industry moans about a depressed market, few if any show evidence of innovative ways to expand their market and reach a larger audience.  Many operators take the attitude that their service is too costly for the larger audience.  Really? Then how about leveraging a larger user base, fill your seats and subsequently lower your cost per seat, per leg?   Doing so would enable your market to expand and applying the innovation afforded by social technology would allow you to reach the larger audience efficiently and effectively.

There is an old saying “If you keep doing what you’ve always done you’ll get what you’ve always got but today you’ll get less.” How are those old ways working for you?  Not good huh? Then innovate!

Private aviation uses the term “legs” to indicate lanes of travel from point A to B. In order to optimize the productivity of an aircraft the destination flight needs to be booked as well as the return flight. However, most return flights from B to A go empty and the originator of the charter has to pay for unused “legs and seats”.

Seems to me that such a scenario represents sub-optimization of the aircraft. Sub-optimization is a waste of an asset and increases the cost of using the asset; thus, limiting the market of users of the asset. Make sense?

Now if we examined new methods aimed at optimizing use of private aviation the answer lies in filing both legs, or expanding legs, and seats with business travelers wanting to go from different points within a “leg” to another point.  The model is exactly how commercial aviation maximizes sales of seats within legs they have determined as “used frequently” by the general public.

Applying New Methods To Private Aviation

Private aviation has a much larger reach in terms of probable destinations for business travelers.  The private aviation industry serves a larger scope of available destinations than does commercial aviation. The problem is that each operator runs their “legs and seats” in a silo of distribution and market awareness. Most operators serve regular customers and wait for the phone to ring to initiate a flight. In other words, operators usually wait until the market comes to them rather than going to a larger market of probable travelers needing to get to and from a destination.

Each private aviation operator runs a sub-optimized system and, given today’s economic climate, they are all feeling the reduction of old utilization models and have assets sitting around waiting to be used. The collective waste of all these sub-optimized systems represents billions of dollars annually and many operators will not survive.

What If?

What if there was a new system aimed at optimization of all available equipment, planes, legs and seats? What if  each operator’s individual system was effectively and efficiently communicated to the general market of business travelers? In other words, if an open source grid of  legs and seats were made available to anyone and everyone, and said grid was effectively communicated to the general public of business travelers, what would happen? The likely results would be the the ability to lower the cost of private aviation, which would expand the market to the general public of business travelers. Subsequently, operators would have the opportunity to optimize legs, seats and related assets. The general business traveler would be given the opportunity  for a much more efficient and accommodating experience than commercial travel and while saving time and money. While the cost may be slightly higher than using fixed routes on commercial aircraft, the time saving and experiential factor would easily justify the increase cost.

Sound crazy? Not really when you consider the power and reach of social technology which could easily communicate available legs and seats to a very large audience.  The technology to create an entire private aviation social grid is readily available and the use of social technology would provide the reach to the general business traveler.

Can you tell I want to go back to using private aviation vs. commercial? I am trying to stir thinking out of the box and collaboration for the benefit of all. Leadership and innovation would be needed to capture market opportunity. Does this make any sense?

What say you?