Social Customer

Managing Communities and Social Content - Ingeniux Introduces Cartella

Seattle-based Ingeniux is new to our watch list, but not to software development. Founded in 1999, Ingeniux has been in business longer than almost all of the other companies we cover. For most of its 10 years, it has been squarely in the content management space. (Its Ingeniux CMS application has around 700 implementations.) The launch of its Cartella social content platform, released in May 2009, marked its entry into the world of social media and online communities.

Based on Ingeniux’s history and core competency, it’s no surprise that content management -- what Ingeniux is calling Social Content Management -- is Cartella’s key differentiator. Few of its community platform competitors have integrated content management capabilities into their platforms, at least not to such a substantial degree. Ingeniux recognizes that, in today’s wired and digital world, every company is in the publishing business and that forward-thinking organizations are enabling their employees, customers, and business partners to share their voices, too. So the company is looking to capitalize on this by providing a unified platform for managing all these forms of content.

Another advantage of 10 years of business experience is that Ingeniux knows how to develop and manage business partnerships. Its strategy of extending its reach by partnering with agencies and technical integrators isn’t a new one, but we like the way it is targeting mid-market .NET integrators, for example. This approach suggests a strong understanding of its product, its market (and, perhaps more importantly, what isn’t its market), as well as an understanding of how to connect the two.

Spigit Taps into the Customer and Employee Innovation Market

Spigit, founded in 2007 and new to our watch list, showed solid results for the first half of 2009. The company reports strong customer acquisition, 100 percent to 150 percent revenue growth quarter-over-quarter, and being cash-flow positive.

Spigit is all about idea generation and management, whether those ideas come from internal or external sources. As such, it competes most directly with service providers such as Communispace (not a company we follow), and platform/service providers such as HiveLive, Lithium, and Passenger, which all have offerings specifically designed around ideas and insights.

Spigit comes in three flavors—IdeaSpigit, InnovationSpigit (see below), and PredictionSpigit—which are all built on the same Java code base. An extensive API set allows technically proficient clients to customize, extend, and integrate their Spigit system.

Mzinga Gets into the Fall Spirit with OmniSocial (and $10 Million in Funding)

After having mixed results over the past winter, spring, and summer, Mzinga isn't wasting any time this fall, by relaunching its product line and closing another round of outside investment on the first day of this new season. Its Social Media Suite and Social Learning Suite are being replaced by OmniSocial^TM, a .NET-based SaaS platform which has its official launch on September 23. And the Boston area company announced a $10 million round of financing led by Acadia Woods Partners, LLC.

This is good news for Mzinga, which had a rough go organizationally in Q1 of this year, with two rounds of layoffs and the departure of its CEO. While many long-time Mzinga employees left the company along with CEO Rick Faulk, things have stabilized since then. It helped that taking Mzinga through this transition has been founder and chairman (and current CEO) Barry Libert. While Mzinga did hire a new CFO and VP of Operations during 1H 2009, we agree that it wouldn’t have been a good time to bring in a new CEO from the outside.

The company was formed in November 2007 from the merger of Shared Insights, an online community solutions provider, and KnowledgePlanet, an enterprise learning provider. In March 2008, Mzinga raised $32.5 million and acquired its Boston-area neighbor Prospero Technologies, a social media company with a focus on large-scale communities in the media, publishing, and entertainment industries.

Deep Social Media Engagement...via Powered

The first half of 2009 was a good stretch for Powered. A 10% workforce reduction wasn’t likely how CEO Ken Nicolson -- who took over the helm in July 2008 after a stint as CMO of Pluck -- ideally wanted to ring in the new year. But, so far in 2009, the company landed several new marquee customers, launched additional communities for exist-ing clients, and released two new versions of its Powered Social Marketing Platform. With seven open positions across the organization, hiring is back, too.

Founded in 1999 and based in Austin, TX, Powered works with major consumer brands to develop and run social marketing programs, including building and managing their customer communities. Although the company’s technology platform and service offerings span most B2C use cases, Powered’s differentiating factor continues to be providing community-based learning environments that educate customers on relevant subjects and deepen their affinity with the brand.

(A good example is Sony’s Backstage 101 Community, where members can take courses on photography, participate in discussions, share photos, and rate and review content...and instructors, too.)

Another Step toward Social CRM – RightNow Acquires HiveLive

In the conclusion of my recent update of the 15 online community and social media platform companies currently on my watch list, I wrote “Some shake out within the industry is inevitable, through both attrition and acquisition. But we don’t see this happening until late 2010 at the earliest.”

With last week’s announcement that on-demand CRM solution provider RightNow was acquiring community platform vendor HiveLive, that prediction got blown out of the water in no time. Ouch. Perhaps it would have been better to have written that “…we don’t see this happening to any substantial degree until late 2010.” That would have allowed for one or two acquisitions between now and next year. But CYA was never my strong suit.

Fortunately the conclusion goes on to say “We expect the trend in specialization to continue, as companies exploit the traction they’re finding in niche markets. And we also expect to see continued focus on integration, both with the overall social Web and with other business applications and workflows (e.g., CRM and ERP systems).”

It’s this CRM integration that’s important here, as it underscores the reason behind RightNow’s acquisition and what it says about where this industry segment is headed. The ROI of peer-to-peer support through online communities is pretty well established. Businesses are using social channels to reduce costs (for example, through call deflection and customer-generated contributions to their knowledgebases), increase customer satisfaction and loyalty, enhance their brand image, acquire new customers, perform market research, identify insights and innovation, validate marketing messages and product concepts, and more. RightNow’s play is about adding a social peer-to-peer component—one that will be integrated with its core CRM product—to its product mix. The company wants to be on the leading edge of this trend, so it’s looking at the HiveLive acquisition as a way to speed its entry into the marketplace.

Lithium Technologies Rebrands Social CRM

The rough economic climate hasn’t slowed down Lithium, which posted a very strong first half of 2009. The California-based company acquired 25 new customers -- including LeapFrog (see screen shot below) -- during the first half of the year, in line with the 28 new accounts from the second half of 2008. Lithium reports over 80 percent new monthly recurring revenue growth for 1H-2009.

Looking to capitalize on competitors with smaller purse strings, Lithium continued to go after market share in the first half of the year. During this period, the company opened new offices in London and Zurich, added eight new agency partners, hired a new VP of Corporate Sales, held its second customer conference, and leveraged its new lower entry-level price point.

On the product side, Lithium has rebranded its on-demand platform as its Social CRM Suite. Lithium’s forums, blog, chat, and reputation systems were already at the forefront of the industry, but enhancements and new applications have resulted in its now being the most comprehensive customer community, collaboration, and peer-to-peer support plat-form on the market. Additions include an idea engine (Lithium Ideas), a collaborative document creation and management system (Tribal Knowledgebase), extensive integration points (for Sales-force.com, RightNow CRM, Twitter, and more), analytics (Lithium Insights and Community Health Index), and content discovery (June 2009 acquisition of Keibi Technologies).

Social Media and Online Security

When I joined Twitter last year to keep track of some Visionary clients, I never dreamed I would become so addicted to it. I would probably embarrass myself if I shared with you just how much time I have spent over the past year and a half scrolling through endless tweet streams, “listening” to and barging in on, other peoples’ conversations, and sharing random thoughts with the world at large. Once I mastered Twitter (I can quit anytime!), I moved on to Facebook, and LinkedIn, and so on and so forth. What is it about social media that keeps us going back for more?

As humans we crave interaction with and recognition from our peers, and now that we have various forums in which to do so, we sometimes have an inexplicable need to let the rest of the general population know what we’re doing, what we’re wearing, and what or where we just ate. Some of us even post pictures of our meals to help our schedule-challenged friends feel that they are right there at the table with us, ooh-ing and ahh-ing over the newest, most creative presentation of steak and mashed potatoes (Oh look! It’s the mountain from “Close Encounters of the Third Kind!”). Unfortunately, in putting ourselves so far out there, we can also open ourselves up to unwanted attention. For example, someone in your offline world whom you’re not expecting to see could show up uninvited to a gathering you’ve planned, simply by searching for your name or handle on the Internet and finding your intended location.

Should You Build Your Next Gen Web Site on a Community Platform?

In a recent client design session, as we were discussing possibilities for designing their next generation Web 2.0 online business platform (they get 70% of their revenues via the Web), the CIO had an epiphany when he was listening to Matthew Lees describe the current crop of online community platforms. He said, “Oh my God, we could use one of THESE platforms to leapfrog our Web 2.0 development by six months! If we start with all of this rich community and social media functionality and ADD our ecommerce engine, we’ll have most of what we need! ” This was music to my ears.

For the last few years I have come to believe that online community should be at the core of MOST companies’ online platforms. It’s not an add-on. It’s the base infrastructure you should start with. After all, your customers should be at the center of your company, no??

Patty Seybold

Online Community Platform Company and Product Update – 1H 2009

We just published our third semi-annual update of premier companies and products in the online community and social networking space. Our watch list now includes "formal" coverage of 15 companies (see the Watch List page of this blog for the list of companies under both formal and informal coverage). For these companies, we look at how they fared during the first half of 2009 with regard to customer acquisition, product lines, service offerings, pricing, business and technology partnerships, financial performance, and organizational structure.

[The full report is available here.]

Over the next few weeks, we'll post an excerpt from the report on each of the 15 companies.

Overall, results for the first half of 2009 for these companies were mostly positive. After a mixed 2H 2008, many companies saw increased customer acquisition and consequently stronger revenues; several reported record earnings. After some reductions in force from late 2008 and early 2009, organizational stability returned, and hiring is strong as of this writing. This bodes well for the rest of the year. Capital investment is down as compared to a year ago—only one vendor raised funds from outside investors in 1H 2009—but with all-but frozen credit markets and investment in high-tech companies down in general, there were no real expectations of such investment anyway.