Today Virgin America announced that it will give away free flights to people with high Klout scores. Klout is a brilliant start up that uses a complex algorithm to analyze your influence on Twitter. This promotion is even more brilliant, for both companies. For Virgin America it brings more publicity, the promotion has already been covered by Forbes, Mashable and the LA Times. More importantly it incentivizes social influencers to fly with Virgin. While the company says that nothing is required, these people are the best Tweeters in the world. The idea of them getting on a plane without sending out a tweet or two is ludicrous. In order to register for the promotion you have to opt-in and get your Klout score. Klout also gets to attach itself to a reputable brand like Virgin. So the upside for the start up is clear as well.
Klout is the first significant player in a space that fascinates me – Reputation Valuation. Until now we have all been judged as equals from the other side of the cash register. However, we are not equals. Some are more influential than others. Some are more desirable customers in specific situations. To date the only industry to really recognize and act on this is the night club industry. When you meet the velvet rope money matters, but not as much as good looks, guy to girl ratio and reputation. When I worked in the industry I watched people ready to spend five grand turned away. I also watched people not planning to spend a penny ushered in when the venue was well past capacity. The reason was simple – influence. A night club is hot when it has the right people, the beautiful and the hip. This creates hype and attracts the big spenders. Influence doesn’t matter as much to most other industries. But it does matter. In fact, I think the ability for every industry to rank influence and reward customers based on their reputation value, is a multi-billion dollar opportunity.
A few weeks back I wrote about Facebook’s ability leverage reputation value on the Smarter Social Media blog. The trouble with the current attempts to rank influence is that they are taking place in virtual spaces. Your influence on Twitter is not the best indicator of your influence in the real world. According to Klout Richard Florida is more influential than Eminem. Facebook has a big edge on Twitter when it comes to ranking influence in the real world. Which maybe the reason Klout released a new Facebook app. On Facebook people give a fairly accurate representation of their social selves. Calculations like number of friends, number of tagged photos, number of wall posts, number of likes, number of comments per post, could be algorithimized into a fairly accurate representation of influence. This information could be packaged and sold to brands far and wide. Restaurants, spas and hotels all want to attract “the influencers”. An entire industry could be created by discounting daily deals based on influence.
Undoubtedly this will offend some. Those turned away at the velvet rope never go home happy. But it’s a beautiful case study in the power of free markets. This time they are putting a value on you!