At this point the results of the Iowa caucuses are reverberating around the punditsphere like the background radiation from the Big Bang. What happened in Iowa is incontestably good for democracy but I will leave it at that and concentrate on what I think were the effects on CRM and the Internet that we might be feeling for a long time.
In one short presidential election cycle we went from the Internet being a politically friendly device — primarily for raising money (2004) — to the Internet becoming a political necessity (2008) for anyone hoping to run for office beyond class president. Actually, there are probably lots of class presidential races that have already used YouTube, Facebook, MySpace or some other vehicle to “get the word out”. It’s the adults running for anything north of dog officer who need to take note.
So what happened in Iowa? Well, curiously, everything and nothing. Let’s take the nothing part first.
Nothing phenomenal happened in Iowa, human beings networked and discussed alternatives among themselves — they caucused — and expressed their preferences. For as long as humans have lived together in inhabited villages, that kind of activity has gone on. As I am fond of pointing out, The Industrial Age practically got its start (for a good discussion of this see “Democratizing Innovation”, by Eric von Hippel) when people formed loose associations to discuss and recommend improvements for the steam engine.
Check it out in von Hippel, in one generation the steam engine went from an under-powered monstrosity to, well, the engine of industry. Iowans were not doing anything more than emulating their ancestors but how they did it is the subject of the “everything” part of this piece.
Everything changed in the Iowa caucuses — the Internet became the tool for connecting people and candidates rather than simply the tool for fund raising. Importantly, this change enabled those who knew what they were doing, to not only broadcast a message but also to listen and listening was key.
Why did Hillary Clinton talk so much about her experience while Barak Obama and John Edwards were talking about change? Were they listening better? The results seem to indicate they were. Obama won a high proportion of the under 29 vote — the very people who are savvy about the social networking technologies such as Facebook, YouTube and MySpace.
Let me quote from a story on the Wired Blog Network (http://blog.wired.com/27bstroke6/2008/01/obama-and-hucka.html):
“Iowa PIRG and Young Voter PAC had worked hard over the past few months to turn out young voters. Iowa PIRG used social networking sites such as Facebook to organize and keep each other updated. The group trained 250 college students to prod and poke their peers into showing up at the caucuses Thursday night.”
“The social networking helps — it’s definitely a platform to launch off to get organized,” says Ellynne Bannon, Iowa and Student PIRG’s New Voters Project. “But we followed all of that up with face-to-face interaction.”
There you go, and ditto for Mike Huckabee by the way whose underfunded campaign also took to the fifth dimension. When Huckabee criticized the Bush administration for its arrogance and mis-management of domestic and foreign policy, Mitt Romney said Huckabee owed Bush an apology but the apology was not forthcoming and in retrospect Romney seems to have been speaking without knowledge while it appears the ex-governor of Arkansas knew his audience.
The Huckabee and Obama campaigns lowered the finance bar showing that big budgets don’t necessarily equate to victory. In the future, that means more candidates will be viable longer into a race than has been the case historically. It also means that even if you collapse the campaign schedule and front load it, under-funded candidates can still compete.
So what CRM lessons can we take from this?
Well, we’ve been talking about the customer for a long time but usually in the context of how much money can we get from the customer and how fast can we get it. That’s over for many good reasons. Today’s markets are, like the political arena, very competitive. If you are a vendor you have a choice. You can either spend a lot of money sending people out into the field to call on suspects, many of whom have only a remote chance of buying your stuff, or you can grow big ears and listen.
When you listen two things happen. You can test new ideas on proverbial ‘real people’ and you can find out how to improve what you already do.
Listening takes many forms but the one that is often highly effective is forming and participating in communities of interest. That’s fundamentally what the social networkers in the fifth dimension did in Iowa with profound results.
The arrival of social networking as a force in business comes at an interesting time for software vendors. We have already seen the impact of selling applications on-line through vehicles like salesforce.com’s AppExchange but that solution can at times get bottlenecked due to sheer volume resulting in some vendors not being able to cut through the clutter. Communities of interest solve that problem and my advice to anyone selling software either on-line or through traditional means, is to develop a community that’s easy to join or drop out of, and listen to what is said there.