Monthly Archives: April 2009

Identifying the Elusive Influencer

And building programs to best leverage your most influential customers

Most companies internally assign a value to their customers that predicts how much money the customer will spend in the future, otherwise known as 'Total Customer Value' (TCV).  Conventionally, the best way to determine a customer’s TCV is to look at how much they have spent in the past: United Airlines gives its best customers frequent upgrades along with a special express line, free drinks, and no charges (and higher priority) for checked bags.  This is because these customers have spent a lot of money with United in the past which is a very good predictor that they will spend a lot of money with them in the future.

While calculating TCV from historical spending is simple, doing so does not value the customer based on the number of people they’ve told about your product and the resulting money these people spend.  Yet people who convince others to buy your product can be more valuable than big-spending customers.

If Walt Mossberg — the technology columnist for the Wall Street Journal — buys your gadget, he's likely to be your most important customer for years even if he never buys from you again.  Mossberg's true TCV should be off the charts!  Mossberg is an example of an influencer.

Influencers are a small group of customers that have the potential to act as evangelists of your product.   In cases where these influencers have bad experiences, they might actively tell people to avoid you (or actively protest your company).  

Companies that understand the power of influencers are now proactively targeting them.   FastCompany reported that marketers spend over $1 billion annually on campaigns targeting influencers – a figure growing 36% a year.  But few companies have any idea who their influencers are and what to do once they have found them.

Identifying Influencers

Determining who is an influencer isn't easy.  Anywhere from 1% to 10% of your consumers are influencers.  Below are some of the metrics Rapleaf uses to find influencers for our customers:  

1.)    Friend count.  Someone with a lot of friends (online or offline) is more likely to be an influencer since they have more reach than the average person and can propagate their message to influence more people.   People with many Twitter followers, readers of their RSS feed, friends on Facebook, or interactions on forums are all good candidates.  While friend count is certainly a crude metric — there are many people with a large number of friends that are not influential -– it is a quick and easy way to segment your customers and it actually works quite well.

Last year, we conducted a study on 31 million people analyzing friendships on social networks. Results of the study suggest that almost 20% of users had over 100 online friends, while a tiny fraction of users (<1%) are “super connectors” with over 1,000 friends.   Imagine the reverberating effects of mobilizing these people.  These are the customers you’d want to target with exclusive offers, benefits, etc. 

Friend count analysis

2.)    Social persuasion.  Let's assume John says he loves an obscure band on his MySpace page that none of his friends talk about.   Then, two months later, 30 of his friends also list that band as one of their favorites.  While it’s possible that John is an early adopter or that he just happened to listen to the band before they made it big, it’s much more likely that he is an influencer and told his friends.

Unfortunately, measuring social persuasion is not easy and can be quite expensive from a data-collection perspective.  One way to gauge persuasion is to take snapshots of a person’s information at periodic intervals. By juxtaposing changes in information (such as music interests) alongside a  social graph (who he is friends with), one can infer whether the person under consideration is influencer or more likely to be influenced.  If a bunch of your friends buy the same product as you in the next few weeks after your purchase (which might be a six sigma event), there is a strong likelihood that you told your friends about it.

3.)    Influence context measurement.  Just because someone is an influencer in books doesn’t mean they are also an influencer in electronics.  Matt Hurst of Data Mining blog looked at the categories of influence in the blogosphere and found that influence is a function of not only reach but also subject matter.  Looking at the linking of blogs, Hurst found that Om Malik, for instance, has reach in the tech space, whereas Michelle Malkin has reach in the socio-political arena.  On the other hand, Jeff Jarvis is influential on both tech and socio-political issues.  Since influence depends on both reach and context and all three of these bloggers differ on both fronts, they are influential in different ways.


Some people will always be influencers – it is part of who they are – while others are influencers due to their current position (careerwise, within an organization, etc.).  And that position might not be obvious.  One wouldn't think of a personal assistant as being an influencer but Reggie Love talks to the most powerful person in the world twenty times a day -– he is President Obama’s personal assistant.



Influencers = $$$

After identifying influencers, how can you encourage them to promote your product? Here are some suggestions:

1.)    Give them the best service.  United Airlines provides frequent flyers with a special number to call and an exclusive web site to shop at.  American Express offers their big spenders a distinct credit card with incredible perks including a dedicated concierge and travel agent, a personal shopper at upscale stores, first class flight upgrades, and no preset spending limits.  You can do something similar with influencers.

You can put your influencers at the top of the customer service queue.  Or have an executive personally call and thank them for being a customer.  Retailers might consider sending hand-written "thank y
ou" notes or providing priority shipping free of charge.  In turn, influencers will tell their friends about you.

2.)    Show appreciation.  One way of making customers feel appreciated is by asking for feedback. Before finalizing a new product, get input from your influencers.  Bare Escentuals does this for new cosmetic products.  If you’re not soliciting feedback, at least give them sneak previews to new products.  In return for showing appreciation, you can leverage focus panels and get critical input at no cost.

3.)    Offer coupons and special discounts.  Providing coupons and special discounts is a proactive form of customer service and marketing.  Retailers can offer their top influencers unique promotions to keep them content and engaged. 

4.)    Employ special outreach.  Rather than just sending influencers the standard newsletter, some political campaigns have interns reach out to influencers directly.  Cultivating influencers give campaigns significant leverage to spread positive news about their candidate (and unflattering profiles of their opponents).   Companies should follow suit to nourish their own evangelist network.

Now all we have to do is get companies to wake up and smell the coffee.  Anyone willing to influence them?


(special thanks to Vivek Sodera and Michael Hsu for their help putting this together)

who’s in the seat before me?

Whenever I'm on a plane, I often wonder: who sat my seat before me.

Was it some dude about to do a business deal or a fall actress leaving her fourth husband or someone who just pulled himself out of poverty and flew for the first time?

Sometimes you get some clues. Like a boarding pass left behind in the seat pocket or a crumpled pretzel in the seat crevice.
And of course, you can often determine the raw size of your prior seat-soul-mate by the seat belt adjustment when you arrive (one thing I've noticed is that big people are much more likely to be in the exit row).

After spending time thinking about who came before me, I started wondering who might occupy my seat after me. There are, of course, almost no clues … especially when one doesn't know where the plane is headed next.

So … I do what I am sure every curious jetsetter does, I leave short notes for my future seat-soul-mate. Of course, there is an art to leaving a note … you need to fold it just right. And you need to disguise it just enough for the rapid cleaning crew to pass over it but you cannot make the note so inconspicuous that the next person will never find it.

I'll usually say something like:

Just wanted to let you know that the last person in this seat wishes you a great flight. He cleaned it thoroughly when leaving. Also — if given a choice between peanuts and cookies, take the cookies. They are exquisite.

Have a wonderful flight,

Your prior-seat-soul-mate

p.s. in case you are wondering, I do not have a cold or any contagious diseases

today’s drug users want to tune-in, not tune-out (Adderall)

In the 60s, drug use was big in the college scene to tune-out. People smoked dope and dropped acid to visit a new world and tune-out of the current one.

Even in the 80s, college students might have been on their way to yuppie-ville, but they were snorting cocaine to tune-out and party harder.

Today we’ve seen a new type of drug explode on college campuses: study aides. These drugs are taken explicitly for tuning-in, NOT tuning-out.

The most popular of these drugs is Adderall which can help a person concentrate better, focus, and sleep less. Essentially, drugs like Adderall (which are highly abused in high schools, colleges, and the workplace), are used to get people MORE involved in society, to concentrate at work, and to get better grades.

My have our standards changed.

my ultimate non-fiction reading list

The following are my all-time favorite non-fiction books.   how many of them have you read??

Adventure Capitalist: The Ultimate Road Trip
by Jim Rogers

Against the Gods
The Remarkable Story of Risk
by Peter L. Bernstein

Authentically Black: Essays for the Black Silent Majority
by John McWhorter

The Cash Nexus: Money and Power in the Modern World, 1700-2000
by Niall Ferguson

Churchill: A life
by Martin Gilbert

Conversationally Speaking : Tested New Ways to Increase Your Personal and Social Effectiveness
by Alan Garner

Colossus: The Price of America's Empire
by Niall Ferguson

The Effective Executive
by Peter F. Drucker

by Leon Uris

Fooled by Randomness
by Nassim Taleb

Freakonomics: A Rogue Economist Explores the Hidden Side of Everything
by Steven D. Levitt, Stephen J. Dubner

The History of America's Future, 1584 to 2069
by William Strauss & Neil Howe

How the Mind Works
by Steven Pinker

Influence: The Psychology of Persuasion
by Robert B. Cialdini

John J. McCloy: Chairman of the Establishment
by Kai Bird

Just and Unjust Wars
by Michael Walzer

The Man Who Mistook His Wife For A Hat : And Other Clinical Tales
by Oliver Sacks

The Moral Animal : Why We Are, the Way We Are: The New Science of Evolutionary Psychology
by Robert Wright

by Elie Wiesel

The Nurture Assumption
by Judith Rich Harris

by Malcolm Gladwell

Path to Power: Early Life of Lyndon Johnson
by Robert A. Caro

A Piece of the Action
How the Middle Class Became the Money
by Joseph Nocera

The Prize
The Epic Quest for Oil, Money, and Power
by Daniel Yergin

Stumbling on Happiness
by Daniel Gilbert

Surely You're Joking Mr. Feynman!: Adventures of a Curious Character
by Richard P. Feynman

The Tipping Point
by Malcolm Gladwell

We Wish to Inform You That Tomorrow We Will be Killed With Our Families: Stories from Rwanda
by Philip Gourevitch

Why We Buy: The Science Of Shopping
by Paco Underhill

A World Lit Only by Fire : The Medieval Mind and the Renaissance – Portrait of an Age
by William Manchester

The Wisdom of Crowds
by James Surowiecki

on rumors of large screened Kindle

One could see a Kindle in a lot of sizes — like the iPod.

I do hope they continue making the Kindle with the current size. It is the perfectly sized reading device because you can operate it with one hand (which is really important if you want to read while walking).

the A-Player janitor

When people think of an A-Player, they often think the person had have gone to Harvard.  They don't.

Each position in your company can have an A-Player.  The person who cleans your toilets could be an A-Player cleaner.  That person isn't likely to be an A-Player lawyer … but the A-Player lawyer probably wouldn't do a great job cleaning either.

As a hiring manager, your goal is to fill each position with the very best person in that position.  If you think of a baseball team, it is pretty rare that the catcher is best hitter on the team.  But having a good catcher is really important.   And a baseball team also needs a great doctor, a great ground crew, great secretary to handle the fan mail, and even a great person to do the laundry.