Lessons from the Obama Campaign for the Software Business

Yesterday at the 15th Annual Stanford University Accel Symposium, I heard an energizing talk with Chris Hughes, Facebook, and Architect of Obama’s Digital Campaign Strategies, and Matthew Barzun, National Finance Team for Obama and Former Chief Strategy Officer, CNET Networks, Inc. on “Technology Priorities: Lessons from the Campaign”.

Three powerful lessons leapt from the stage that certainly any software company trying to do something different should understand. These apply to any company who cares about their customer community and focuses on growing a large business.

Scale and Focus

Traditional software counts on hunting down customers and finding those willing to pay the large price tag. Kind of like traditional political fund raising where fund raisers seek big-heeled donors for the $5,000/plate dinner.

The Obama campaign’s New School thinking concentrated on creating scale and community. Instead of only mining a list for the 1-in-5 donor with the big bucks, they started asking 25 people to go out and each find 25 more to pay $25 to show up at an event. The first time they tried this, they sold every ticket. So they tried it again, and next thing they knew: 1,800-person venue sold out.

Thinking how to scale from a smaller list of initial supporters (Obama challenge) was very different than thinking how to divide-and-conquer the large list of potential donors (Clinton early advantage). Matthew said it required concentrating on metrics that really matter – a mantra within the campaign, lowering the barriers to entry for donors and supporters, while having high expectations for the ultimate outcome. Aside from this concentration on large scale, they were relentlessly focused on immediate outcomes: they had to win Iowa; there was nothing after Iowa. Matthew represented this new thinking…


Farming vs. Hunting

The campaign compared their marketing strategy to Seth Goding’s Farming and Hunting analogy. The new school campaign focused on farming a community versus only game hunting (Yes, they did both: about half small donors; half large.). The idea was to spread word-of-mouth, build a bigger community using the existing base of early passionate supporters.

The trick was multiplying the base versus the traditional 1-in-5 division game of hunting. Build the community through networking. Get 25 supporters to rally another for a small entry fee. This is how Matthew illustrates some of the early results…

Once the Obama campaign got this farming working, the multiplier trumped any notion of relying on the traditional approach.

Values Matter

Communities thrive on trust and respect. If you are serious about building a community of supporters or customers, start with asking how to treat people. Here’s the Obama Campaign Code they handed out for the Iowa caucuses: three simple values:

Respect
Empower
Include

At one caucus the Clinton people showed up with 13 supporters, which on a Cold Day in Hell in Iowa is a good showing. The Obama supporters on the other side of the room numbered 68. But the Clinton group was below the 15 count needed to participate. The doors to the caucus closed at a specific time, meaning no more participants. The Clinton team was potentially without a quorum.

Then after the rules allowed, in walk two more Clinton supporters, giving Clinton a quorum. This was against the rules. What did the Obama supporters say? Let them in. Include them. They deserve to be here. The spirit in the room was immediately more inclusive.

Software companies (all companies frankly) would do well to start by treating their customers with respect, treating them well, and concentrating on inclusion. A couple values we think apply to software companies is treating customers equally and fairly regardless of their company’s size or the size of their orders, and opening up information about your company (pricing, licensing, source code, bugs) so you build trust.

Applying new school marketing thinking and concentrating on scale, inclusion, and low barriers made a whopping 100% difference to what Obama raised. What would it do for your business, Mister Software Man?

Why Obama Won the Election

2008 Election Results - the Growing Democratic Possibility

I voted today in California using my absentee ballot because I am headed for Europe and will miss the election. Absentee voters sometimes think they are not counted on election day. This is a myth. Because I am missing the celebration, I am declaring the results now, two weeks in advance of Election Day.

 
The election is over for a five glaring reasons:

1. The War – Barack Obama beat Hillary Clinton largely because of one issue: he voted against the war. He has singularly differentiated himself, and against McCain, it is a more stark difference.

2. Change – McCain is the Faux-Maverick. Both the mavericks in both parties won their nominations, an encouraging fact. That signals the electorate wants change. The problem for McCain is Obama owns the Change mantra, and has proven in the Campaign Death March, he means it.

3. Sarah Palin – is an embarrassment. Most Americans think Bush has done enough damage, and it’s time for strong leadership. Palin represents another poorly prepared politician who will need to be propped up by advisors. McCain blew this Big Time. This weekend, my die-hard Repulican brother-in-law said he was changing to Obama because of Palin. This man was recently worried about Obama’s relationship with Reverend Wright and his strength on terrorism. Palin trumps all these issues. She is not a statesperson deserving of high office.

4. The Economy – Warren Buffet supports Barack. Game over. Buffet is not just esteemed as a brilliant investor. He is one of the few trusted financial figures in this unstable economy.

At a large dinner in Silicon Valley filled with hundreds of venture capitalists and financial people at a swank country club last week, one of the smartest VCs I know said, “Invest in Buffet’s company. Don’t buy GE. Don’t buy Goldman Sachs. Regardless of their price right now.” Here’s a man in a room full of folks who might often fall for the No-Taxes-Republican-Head-Fake. Not this time (as Obama often says). This room of financiers was full of Buffet and Obama supporters.

5. International Leadership – I have yet to meet one person overseas, in numerous trips, who likes George Bush and supports the war. Who cares? These people don’t vote here? In fact, this is telling. America sometimes ignores common international logic, but the preponderance of international support for a different direction says a lot about where our country needs to go. Leaders in this country want to re-establish the country globally; these leaders largely support Obama.

The War, Change, Sarah Palin, The Economy, and International leadership. These are the glaring reasons Obama won.

He won’t win of course unless every one of you American readers gets to the polls and makes your vote count. I have had a dream for some time: that Obama beats McCain decisively by a minimum of eight percentage points, that he wins states like North Carolina and turns the Democratic vote into a wider base, that the election is a clear signal to Change. We need every vote cast. This is the best opportunity we have had since Kennedy to have a Real Leader.

McCain will not win. Not this time.