good morning. coming up on msnbc's "your business," in spite of facebook's struggles, companies see it as a powerful marketing tool. but is it really working to increase your sales? it was one of the hottest topics at the southwest by southwest festival. future intelligence and how it may impact your industry. and how online disrupter shopify is the go-to site looking for those to attract the customers. we have the latest digital strategies you need to grow your business. that's all coming up next on "your business." >> "your business" is sponsored by american express open.

helping you get business done. >> hi, everyone. i'm jj ramberg. and welcome to "your business," the show dedicated to helping you grow your company. love it or hate it, social media, particularly facebook, is a big deal. and while there are endless questions right now about how it's being used and abuse in the political world n the business world, many entrepreneurs take it on faith that their company needs to be on social media if they want to stay in the game. we have decided to take a closer look to find out what's the payoff? is social media really cost effective? ♪ it's a refrain we hear from almost every company these days. like us on facebook, follow us on twitter, join us on instagram, sign up for weekly updates. even on this show, we say it every week. and don't forget to connect with us on all our digital own social media platforms as well. social media has been hyped for

its ability to connect brands directly to consumers, increase brand loyalty and boost sales. and all for a bargain price. but does it work? for some, it does. but it is not a slam dunk. >> the study that harvard business review published last year showed that following a brand in social media has no impact on their buying. how much else do you need to know? it's next to nothing. >> bob hoffman is a 40-year veteran of the advertising industry. >> as a businessman, i don't care about engagement. i care about sales results. i want to see what has actually happened as a result of the money i'm spending on advertising. >> now he's an industry critic through his blog, the ad contrarian. he says too many companies are putting too much effort into social media for all the wrong reasons. >> followers like engagement to

me are a false goal. the goal is to sell somebody something. >> not understanding how to use social media in a larger marketing mix is one place where experts think brands get it wrong. >> i think social media and probably the open web, too, for a small to medium-sized business is more creating awareness. less so getting someone to immediately click on a thing and doing the action. >> dan greenberg is the founder of share group, a san francisco-based international agency specializing in website advertising. he says social media should just be a tiny part of a much more complex advertising recipe. >> facebook and social media can't be the beginning of the strategy. that needs to be a tactic. the strategy needs to be who are we trying to engage and why. and what do we want them to do? >> if you want to generate sales through social media, he says, you need to first get to know your real-life customers and why your product matters to them. >> it has to start with somebody who actually does like your brand. so if you have people who actually like your brand or

actually like your company, what social media's good for is to nudge them to help them amplify that to their people. >> the founder of l.a.-based digital ark terchitects makes a similar point, you need to think of social media like attending a cocktail party. >> if you are just standing in the corner of the cocktail party and not engaging or asking questions, you're bad at a cocktail party and bad at social media. >> rena represents social media influencers, people who have built up a large number of loyal followers. her clients make paid endorsements to beef up the sponsors online likes and comments. >> you have to be really specific about your goals. >> while influencers can do a lot to boost brand awareness, rena warns when it comes to actually selling products, many influencers have trouble turning the likes into sales. >> if ultimately your goal is to drive x units of a product, that's a smaller segment of the digital population who have the

ability to have their content translate in direct sales. >> anybody is going to be turned off if someone just starts yelling at them, buy my product all the time! >> for those who can get their customers excited online, social ya can sometimes deliver a windfall. >> there are thousands of musicians all over the world making six or seven-figure incomes that you have never heard of. and they are using social media to do that. ♪ i thought i needed more >> los angeles-based singer/songwriter ari knows how they do it. he knows because he helps to use social media to build their careers and make money through his online blog. >> youtube is absolutely one avenue where you can do that. and you can have, maybe, 2 million subscribers on youtube. >> for many businesses like ari's clients, youtube is the right platform. but it is not for everyone. facebook, instagram, twitter and the others each have their own dynamic and success is difficult without understanding the

differences. >> each social network has its own community, has its own etiquette. and so the way that you interact with people on facebook is so different from the way you interact with people on twitter or different than the way you interact with people on instagram. >> facebook is really great at engaging with a little bit of an older audience, instagram is great for younger audience. >> on facebook, people share articles all the time. and they say, hey, i can't believe this just happened, link to an article. you can't do that on instagram. you can't link to things on instagram. comedians blow up on twitter because they write hilarious tweets and then everybody re-tweets it. >> given these dimpfferent qualities and routines, scotty who is a maker of college party items says to approach social media like you do going to the gym. >> it's going be completely different if you are trying to gain 15 pounds or muscle or trying to lose 45 pounds of fat. it's completely different in the

outcome. >> you select which equipment to use based upon the goals that brought you there in the first place. but unlike a gym where hard work usually delivers results, social media metrics don't always translate into increased awareness or sales. >> what is not clear to us is how the advertising works or whether it actually reaches real people. >> samuel wooley of the digital intelligence lab in palo alto studies the automated software or bots on social media. he follows all the platform owners for not releasing these fake phony followers or likes. >> that bots get used in and around the business sphere to drive up supportive advertisements to give the illusion of popularity to advertisements, to make it look as if these things are more popular than they are. and that is very problematic from a business perspective because the promise that the company's making to you is you have interaction.

however, anonymity believes the social value can be made. >> the dollar value of a facebook like varies based on community, based on demographic. >> and how many other likes does it lead to and who was it that liked it? >> how many people are interacting with the content? are they liking it or is it bots liking the content? >> based on the audience. >> and how large is their audience? >> what is your outcome? >> in some regards, it's a telephone chain. >> based on the product, based on the company. >> et cetera, et cetera, et cetera. there is lots of talk in every hallway here at south by southwest about artificial intelligence. and how it is going to change everything. so we wanted to know, how can it change your business and what things you need to be thinking about? so we're sitting down with steven who is the chief marketing and communication officer to break it down for us. >> happy to. >> thank you. i just mentioned artificial

intelligence, but when we talk about business, we're talking about machine learning from most of us. what is machine learning? >> that's right, jj. you have tech yesterday by calling it machine learning. artificial intelligence is a general umbrella for all the different techniques that include natural language processing, using voice and google assistant, certainly vision and lidar in autonomous vehicles. but marketing for people with powerful tools we have seen learning, that will help you understand how to identify patterns in the data. and using statistics to make predictions around the world. >> so i, as a company, am collecting all kinds of data from -- i'm a dry cleaner, i know what time they come in, how many shirts they press each week, what time they leave. i have all this data. how do i parse all that? how does machine learning happen? >> sure. so that's a really great example because you have all the inputs, but you don't really have intelligence. you don't have insights.

so part of the challenge is, how do you go up the brand hierarchy of intelligence and data. but only with machine learning can you get the inside and the epiphany to discover something you would have never been able to do before. that's where the power of machine learning is. the reality is you can have all the different touch points to understand the customer journey and improve the customer experience. this ultimately has to be putting the customer at the center. if you know when they come in every day of the week, the items after leaving, how are we going to improve customer service? how does that improve the product? it's understanding all the patterns in the data to deliver that experience. >> but what tools do i need to take all this data, i want to take it and stick it in the data machine and spit out the insights for me. >> there are a lot of data tools out there. you can use a marketto to amazon web sources that has a ton of tools at your disposal.

and facebook, google and comcast are providing solutions for the audience to use machines. >> we'll talk about the chat bots and how that is changing business on a small scale. that's just the beginning of what we are going to see from businesses. >> tech bots are providing the way to have realtime two-way communication between the company and the customer. think about it -- >> very efficiently because you don't have 20,000 people answering the computer. >> very efficiently, but you're able to weave in machine learning and human learning. how do you fuse the two so that the machine learning can inspire the human learning. and the bots are effective because there's going to be the same ten questions, what time does the store open? what is the inventory? right now go to a website and go down all the sub navigation menus. that is time consuming. if you answer the question through a tap bot, get the answer in realtime and you

choose your own adventure. you may understand the questions to lead you down the path. now you can figure out when to up-level that and have human interaction because we want to provide more personalized service or an opportunity to provide an upsale. that's where the machine learning will impact -- >> now we are starting to see, but what is coming up ahead? what do i expect out of a.i.? are you going to walk into a store and suddenly water is going to magically appear in my hand because they know at 2:00 on thursday i get thirsty? >> well, the reality is you'll see a lot of one-to-one communications as we're driven by insight. the reality is people don't have insight, you're sitting on the data. but if you understand you need the human judgment to make analysis of that. for example, let's say it's june and you see lots of shark attacks and lots of sales of ice cream. you don't want to coor rate the two things. they just happen to be in the same time period. but if you understand the patterns in the data, you can understand how to deliver a better customer experience. that's one of the most exciting

things. but a.i. is going to transform every customer experience, every company and every industry. you have to think about this as almost like electricity. it's going to permeate every aspect of society. it will be bigger than the internet. so how are you preparing for this? what is your a.i. strategy? you should start now. >> thank you for explaining this. really helpful. >> thanks, jj. it started the way so many of the companies we provile do, with a pro -- we profile. they couldn't find a simple solution so they built their own. then they realized other businesses could benefit from what they created, so they launched shopify in 2006. now shopify is the e-commerce platform for online stores worldwide. we sat down with tobaccoy to tr about why diversity is so important when hiring.

>> i packed a backpack and a suitcase and then went -- i had never heard these terms and would take notes. then i would go back to my hostile and use the wi-fi from a neighbor to go to wikipedia and learn about the terms. then i could answer one more question the next time i had a meeting. you always hope the crystal ball is fairly clear. one of the things that has been leading to small businesses getting into trouble is that reality shifted and suddenly they are no longer current. so shopify is rural-based of inoculating people from these forces. we need to be exceptionally inhave to vinv inhave i

innova innovated. if you think about commerce, commerce fundamentally is at the intersection of technology and in sort of a weird way, if you wish. people have -- they see something they want and go to say, i would like this. technology is coming, like virtual reality, augmented reality, which are kind of bringing these things ever so much closer. and it is wonderful for small businesses. i absolutely committed the start-up founder and i got this piece of feedback that meant to say, i love the company you're building. just one thing that is irritating. everyone is a version of you. at this point, this was so obviously true. and we made a pint of hiring people who are very different from us, but also, that didn't just mean gender diversity, people who spend their lives differently. people in different industries or different degrees and so on. and the moment we get this into meetings, suddenly everyone had

this really completely but different and interesting ways to look at this. i spend most of my former years in my life with computers. i spend, especially a 16-hour day where i was programming. and probably my earliest attempt at management was to treat people just like that. and that didn't quite work out. so i had to at some point say, i have to go back to square one and say, i need to understand how other people function. we called a trust battery between two people. as you work together, you fully charge and trust each other. that means very low process. we can treat process as a way of corporate world baby-proofing. there's no limit to personal growth. weap we found this is something that can take action as a business. we have been confident saying, shopify is going to be a better company every year.

and therefore we have to become better people every year to be able to keep the harmony. apps have completely changed the way we do so many things. that's why i was so interest in the company talk space, which people use to connect with therapists. with it, the couch and appointment book are things of the past. unlimited texting is the way you can communicate with your doctor. and while the company is only a few years old, their number one priority is advancing the conversation about menital healh care, even if the approach is controversial. just a few years ago, their marriage was on the brink of collapse. >> our marriage was about to collapse. we gave it one last chance. >> in a last-ditch effort, they tried couples therapy. >> for us, it was a wonderful experience because it taught us how to communicate with each

other. and we can see the value. and i could extrapolate the value to see how it applies to so many people. >> therapy saved their marriage and gave them a business idea. in 2012, they lawn unched talkse in new york city to replace the traditional therapy office with something more immediate, unlimited texting directly to a licensed therapist for $25 a week. >> i'm just taking my phone and i'm texting when i feel the need. now i'm anxious, am i overwhelmed? i'm texting you. it feels so normal because this is how i'm communicating with everyone in my life. >> this is unchartered territory for the couple. orrin's background was in marketing. and roni recently completed her masters degree in psychoanalysis and psychotherapy. neither of them knew the industry and weren't sure if the company would survive. >> we lost people, we had no money.

>> but they saw a glimmer of hope in a very unlikely place. >> we had a link called customer support. and obviously, i was sitting there because we were just, like, two, three people. we just started. i think our clients, our members interpreted this name to customer clinical support or therapy support. and i started getting hundreds of e-mails telling me about their clinical issue. >> we said, okay, we know that people feel very open and very willing to share everything. so i'm thinking, why don't we do it with two people. we tested it immediately. >> after rebooting the company, they quickly got traction with the one-on-one model. a therapist paired with a single client via text, usually on a smartphone. >> if you were to come into my office and sit down, it would

feel probably a little bit like formal. if you're on your computer or on your app and you're at home and you're in your comfort zone and you don't have to look at me and see what my reaction is going to be, maybe it is a little easier you to share things. >> kate denahan is a licensed clinical social worker. she has an office with a couch but finds the flexibility of having clients text her when she is at home easier and sometimes more effective than a face-to-face appointment. >> if a client has a bad day or a crisis happens, they don't have to wait until next week or month to see me, so they'll get that immediate response they're looking for as opposed to holding those feelings, which can sometimes make people feel worse in the end. >> of course, therapy via text is new and largely untested, which means it is not without controversy. so oren and ronnie feel in order to build the company they need to build trust in the community. that's why they launched their

future of therapy conference. >> ronnie and myself both fell in love with this profession that's called therapy. >> this first-ever gathering arranged by the start up attracted therapists, academics and experts in mental health, placing talk space in the conversation about modern-day health care. >> talking about the advantages and disadvantages and having an honest and open discussion about how to make it better all the time is a necessity. therapy is moving online, it is migrating online. i think most people involved in the professional agree with that statement now. there needs to be a place, an area in which the discussion is being handled from a point of view of value. >> and they hope that place is talk space. >> therapy for how we live today. whether you want to retire, you want to explore new interests or you just suddenly

need to change your management team, there comes a point when every leader must move on. here are five tips on creating a secession plan. one, consult with your attorney. a lot of preparation goes into preparing your company for new leadership. speak with your lawyer to make sure you're doing the right thing, protecting yourself, your business and employees. two, look within all of your ranks. your company's second in command may not always be your best successor. additionally, you may want to consider training your people to take over in case your second in command or other leaders have to take a sudden leave. three, put your plan in writing. are you selling your business, transferring ownership to a family member, dividing it amongst shareholders? pick a date and develop a record of what you need to do and think about before leaving your company. four, make sure your company works without you. you never will be able to retire or move on if your company needs you around to make every

decision. train your successor and employees to make decisions without you and create repeatable, fool-proof systems where you can. five, communicate, communicate, communicate. determine who in your organization or life needs to know your secession plan. communicate with him or her regularly and allow them to weigh in on your blind spots to make sure that your plan goes off without a hitch. when we come back, how does a growing company manage cash flow and why you should encourage your employees to have a side project. ♪ sponsored by -- thank you so much. thank you! so we're a go? yes! we got a yes! what does that mean for purchasing? purchase. let's do this. got it. book the flights! hai! si! si! ya! ya! ya! what does that mean for us? we can get stuff. what's it mean for shipping? ship the goods. you're a go! you got the green light.

that means go! oh, yeah. start saying yes to your company's best ideas. we're gonna hit our launch date! (scream) thank you! goodbye! we help all types of businesses with money, tools and know-how to get business done. american express open. ♪ as a fast-growing company cash flow management is so critical to us, how do we manage the ebbs and flows of our cash as we're growing? >> so you're always fundraising. i think some entrepreneurs and business leaders think more fundraising, time for money, that's too late. you are cultivating with people that will give you equity capital. then don't be afraid of debt, but be afraid of debt. if you can raise debt, do it thoughtfully, not too much, but between debt and equity you can keep the lights on and keep

making m making payroll. let's get their advice. amy derek is a dermatologist and founder derek dermatology in chicago and venture capitalist and private equity patrick mcguinness. good to see you both. what have you seen with the things you have been investing in. >> what i like to tell companies is encourage your employees to have a side hustle. >> really? >> 40% of millennials actually have side hustles to tate, but the companies they work for aren't benefitting from that. if companies support their employees entrepreneurial ambitions, they find out the employees are not looking to get a new job, but looking to learn things, explore opportunities, try something out they never tried before, and they can bring it all back into the workplace to make their companies far more entrepreneurial. >> how do you deal with the time issue? if you need someone working -- and i get flexible schedules, but still you need someone working for your company.

what happens when the side hustle becomes more interesting than your company in. >> the thing is ground rule. say, you come here, do an amazing job and do these on the side. they just want to have an experience, and the reality is that it is hard to teach somebody how to think like an entrepreneur unless they've done the work of an entrepreneur. you're getting on-the-job training for free for the people. >> amy, i'm happy to have you here because sometimes people forget doctors run their own businesses. it has been a failure of my part not to have enough doctors on the show talking about what it takes to run a business. you have how many people work with you? >> about 180 staff. >> wow. okay. so you run a big company. what is your tip? >> i think you need to figure out what your value proposition is to your patient or customer and make sure it makes a difference. in 2006 i started in my practice and patient experience was off the radar screen of physician offices. people made their patients want

wait an hour, hour and a half. actually, if your patients didn't wait, it seemed like you weren't that popular. i spent the last 12 years trying to figure out how to run on time, about 87% of our patients are seen within five minutes of their appointments. we track happiness scores through net promoters scores. >> it is basically going and talking to your customers, in your case patients, finding out what they care about rather than what you think they care about. >> absolutely. what i found from surveying patients -- we see over 100,000 patients a year, is they care about that we're on time, we're available. we're open 7:00 to 7:00. we have weekend hours. when you are sick and have a rash, you need to get in within the same week. >> i think you do so much -- sorry to interrupt, but you do so much with companies and it is about going to talk to your customers. >> completely. so many people forget to do that, it is shocking. smart people forget to do this.

>> i will add might i changed pediatrician because in the old one the doctors were great, the service experience was terrible. i think you hit on something. i think that's great advice for other companies. thanks, you both. this week's your biz selfie comes from vanessa nelson who owns expert human resources in flint, michigan. she focuses on maintaining employee law compliance, employee training and executive recruitment, things a lot of companies need. pick up your smartphone and take a selfie of you in your business and send it to your business@msnbc.com. use the #yourbiz selfie. we love hearing from you. if you have questions or comments e-mail us at

yourbusiness@msnbc.com. also check out our website. we posted everything from today's show and more for you, and you can find even more on our digital and social media platforms, too. one other thing, remember to check out our podcast, been there, built that. i get to have in-depth conversations with some of the smartest founders and entrepreneurs and decision makers. it is worth a listen i think. we look forward to seeing you next time. until then i'm jj ramburg. remember, we make your business our business. ♪ sponsored by -- helping you turn your ideas into reality with money and know-how so you can get business done. oh. nuh uh. yeah. ahhhhh. mm-mm. oh. yeah. ah. agh. d-d-d... no. hmmm. uh... huh. yeah. uh... huh. in business, there are a lot of ways to say no.

thank you so much. thank you. so we're doing it. yes. start saying yes to your company's best ideas. we help all types of businesses with money, tools and know-how to get business done. american express open. ♪ welcome to "politics nation." last night i came back from washington, d.c. after covering the march for our lives. hundreds of thousands of demonstrators descended on the city for a display of youth power, demanding action against gun violence. i was incredibly impressed, and here is why. because those young people seemed focused and had the cause and purpose above