Klout's Dramatic Relaunch: Can an Emphasis on Content Make People Care about Scores?

By Sarah Lacy , written on August 14, 2012

From The News Desk

Joe Fernandez -- with a perma-grin, hands humbly tucked in his jean pockets, and a nervous laugh if he edges towards saying something controversial -- does not come across as a guy comfortable with pissing people off. But his company, Klout, has done just that pretty much since inception.

He didn't anticipate it, but four years in, he gets why Klout makes people so angry. "I didn't understand the psychological effects. I just thought it was a convenient way to digest a lot of information," Fernandez says of his naiveté in Klout's early days. "But we put a score next to your face. It's so tied to your ego. On Google, when you search for your name, you may find stuff that's wrong or not you, but you don't get offended in the same way. You don't get personally insulted. We get a lot of direct rage at us."

He describes Klout internally as the "Los Angeles of the social Web." If you've never actually visited the site, you have all sorts of preconceived notions, and you probably hate it. But if you spend time there, you see it's not such a bad place. Considering Fernandez's loft-like offices are just blocks from the San Francisco Giants stadium where "Beat LA" is continually chanted, whether the Dodgers are in town or not, calling himself the LA of anything shows stunning self-awareness. "I'll take it," he says with that nervous laugh. "At least we're relevant. I've done plenty of stuff people didn't care about."

He's right -- Klout has become a lightening rod in an age of hyper, always on Web self-expression. Part of that is unfair. Klout does something very impressive if you step back and think about it. A relatively small team of people crunch 12 billion points of data everyday across every open, active Twitter profile they can get their data-grubbing paws onto, some 100 million profiles. That's equivalent to one-third of the US population. And that challenge only grows as more people are creating more data every single day. The fact that Klout can come close to making sense of all that should be considered a coup.

But when you are putting a score in big red letters next to someone's face, accuracy suddenly matters. The rage is frequently from people who don't think their score is high enough. Sometimes it's from people who object to being boiled down to a number at all. And sometimes it's from people -- like me, I admit -- who just aren't sure something as intangible as "influence" can be crunched by an algorithm and boiled down to a number. It reminds me of that scene in "The Simpsons" where Milhouse's mom is playing Pictionary and draws three dots and everyone says, "Oh yes, that's 'Dignity'. Worthy of Webster's..."

Today, Klout is rolling out the biggest relaunch of its site in company history. It will silence some of those critics -- including me, partially -- and enrage many more, because the scores are going to change...dramatically. The only thing that angers people more than putting a big red score next to their face is changing it once they've gotten used to it.

But two things should make Klout's team and investors care little about the predictable backlash. The first reason is it's much closer to the vision Fernandez had in mind when he created the company. The second reason is it will largely piss off the people who should matter least to Klout; the people who matter most will love it.

The new version is taking into account real world influence -- through a combination of bringing in 12 times more data points everyday, and taking into account things like Wikipedia pages and weighting LinkedIn profile data higher.

That means the score for uber-investor John Doerr, who doesn't Tweet a lot, will jump more from a 46 to a 78. He'll still rank slightly below Robert Scoble, as Klout wants to prioritize Web influence. Since Doerr doesn't Tweet much, it's really showing you his potential influence. If he were to actualize it, his score would leapfrog Scoble dramatically, Fernandez says. "When I saw that my little sister ranked higher than John Doerr, I didn't feel great," he says. (Especially since Doerr's firm Kleiner Perkins is a Klout backer.)

Put another way, President Barack Obama will now rank higher than Justin Beiber. This should make anyone who actually wants to use Klout to understand real world influence happy. (Read: The people who matter.) Smankers who have gamed their score through endless Tweets and RTs and other Twitter games will no doubt lose their shit, because the more your influence is about being a bully on Twitter, the more your Klout score is going to suffer. "We're getting better at sniffing out insincerity," Fernandez says.

But the relaunch is about way more than scores changing. The other reason I like Klout way better today than I did yesterday is that it is edging away from its slavish love of the algorithm and towards the messy, un-quantifyable world of content.

Klout profile pages suddenly look a lot more like Path. If you have claimed your profile, you see a score still, yes, but it's in a smaller font size. The focus becomes a timeline of recent social media interactions -- specific Tweets and status updates and Instagram photos you've sent -- that have resonated with your audience.

If you haven't claimed your profile, Klout has fewer data points, as it is only pulling in your Twitter feed. But it shows you a "Hall of Fame" of your influence nonetheless -- what Tweets you've sent that had the biggest impact. It's not just about how many Retweets you got, but who Retweeted you, and how they did it. Did they add their own commentary? Was it a "via"? Or a h/t? Or a straight RT? Some 400 factors play into that score. It's less a number, and more a social resume on one page.

The goal is to make you feel less like a lab rat, less judged and put into a number and more celebrated and praised for the clever thing you wrote that resonated with so many people. Fernandez says this isn't a retrenching, that he always intended for the score itself to just be the tip of the iceberg. "Influence is a complex thing," he says. "We never meant for it to just be a number."

People don't want their life, their relationships, their words and actions and emotions boiled down to the back of a baseball card. They want to feel important. Design-wise Klout is edging not only closer to Path, but closer to social media aggregators like RebelMouse and Glossi.

The better you feel about Klout, the more likely you are to claim your profile. That means you are more likely to add or delete areas that others that Klout has guessed you are an expert in, and you are more likely to sync Klout up with your other social media profiles. That means you get a more accurate Klout score -- which means Klout becomes far more valuable to the world.

This gets at the core of Klout's Achilles Heel. Klout is an odd company: Its value in the world has been dubious to the consumers but clear to companies and brands who want to reach them. In a world where consumers flame you on Twitter first and ask questions later, brands are desperate to know who is just a malcontent and whom people actually listen to -- and they want to know it before they piss you off. (Just ask Progressive Insurance.)

Witness: Klout has processed nearly 2 billion API calls per day, from some 8,000 partners  -- frequently from customer call centers who want to know exactly who they are dealing with. It has done 400 "Perks" programs that have given some 750,000 influencers special deals with no quid pro quo-- only a hope that they'll say something nice. Right now Klout doesn't charge for the former, and gets some revenue from the latter. But the more accurate Klout becomes -- the more the people being measured actually embrace their scores -- there's a clear and defensible business model here.

Klout may be one of the only companies in the social Web today who has a clearer business model than a value to users. It's critical that this release change that. Fernandez says that 2012 is the year that Klout "steps up," and 2013 will be the year it starts to make the company scale. New focus on content or not, he says it still boils down to this: Can a number really be a consumer product?

A world where influence is boiled down to a number may still be distasteful for some -- it still is for me. But it's a reality. It's the flip side to all that social media empowerment of the last eight years. We have a new way to sound off; brands are grappling for a way to manage that. If they're going to use scores to give out special treatment, better that they be accurate, right?

To Fernandez, it represents a democratization of special treatment. Brands have always treated customers differently based on something. Sometimes that's how much you've spent in the past. Sometimes that's your last name. Sometimes that's being a member of the press. Paul Carr has Virgin America jumping through hoops every time he Tweets about their lousy online reservation engine.

Brands are going to make judgements by looking at a dossier of you and you'll get different treatment as a result. That's just reality. Now, at least you can get it not just for the money in the bank but for the words that flow out of your fingers.