SOCIAL MEDIA: THE WRONG TERM?
Social media is used as a buzzword to describe different types of realities. The term is too narrow
compared to the social media universe.
A framework for social media – proposed by appsavvy’s Chris Cunningham – that would break out opportunities within social media could be:
o Social CRM, community management and fan pages (15% of the world of social),
o Media next to social, the display in other words
o Audience and activities
Medias are inviting themselves more and more into a broad human reality: human conversation. To describe a conversation, one has to specify:
o The people who are talking to each other (e.g. customers among themselves, brands to customers, customers to company, experts, journalists…)
o Topics of the discussion (e.g. products, brand lifestyle, tips, events, news…)
o Motives of individuals behind these conversations (e.g. monetary incentives, social recognition, needs for advices, strong emotions or strong opinions…)
o Venues (e.g. twitter, facebook, blogs, reviews and comments, phones or offline!)
Once this has been specified, one can say what this is all about, and structure how the conversation should be handled, with which goals, strategy and metrics. Social CRM systems present a huge challenge in the sense they have to include all the diversity of phenomena described above.
o Social CRM, community management and fan pages (15% of the world of social)
o Media next to social, the display in other words
o Audience and activities
o Topics of the discussion (e.g. products, brand lifestyle, tips, events, news…)
o Venues (e.g. twitter, facebook, blogs, reviews and comments, phones or offline!)
TRUST, IDENTITY, INFLUENCE AND REPUTATION
Referring to an HBR (Harvard Business Review) article about Coca Cola that was looking back at the past 125 years of the brand, the panel discussed the role of TV advertisement and its measurement in terms of exposure and number of impressions. The next 125 years will focus on how people express themselves about the brand even after they got exposed, as they may become influencers in their circles. Influencers are as important to reach as customers.
Social media is about digitalizing real life interactions, making collected data easy to process, analyze and measure in an accelerated manner. And people are happy giving up information digitally as long as they can gain access to useful tools.
EVOLUTION OF SEARCH
Algorithms are in the process of being humanized. It’s less and less about what is relevant according to the community, but more and more about what is relevant to you. Search is moving social because the use of the web is evolving to being based on conversations. In conversions, people give a lot of information about themselves and this data can be used to make the web experience truly tailored.
The web is evolving towards being individualized, which creates more and more opportunities for companies, but also raises questions on how good it is for users to have their web experience tailored without their own consent.
THE KEY TO SUCCESS: SCALABLE AND REPEATABLE
Yes all companies try to find ways to be trustable, with a strong identity, influence and reputation. And, yes all companies know that to do so starting a conversation, a dialog with customers is the best strategy. However, most companies launch social initiatives, which can be run only in the short term. Creating scarcity next to social may be powerful (“the shinny new thing”) but the challenge is to scale. Few companies are able to build social tools that are scalable and repeatable, which would help them maintain consistent and long lasting relationships with customers. Short term social successes have prevailed so far.
Most social media companies have followed this track on building expensive fashionable tools that drive attention to their clients in the short term but do not accompany the long term strategy of the firm. It explains why social media still struggles to be perceived as a key component of the marketing strategy of companies. There is a need to a cohesive platform to scale social.
SOCIAL IS NOT COMMERCIAL
Social is a discussion. Real life discussions are not commercial. Companies have been commercial for decades. If companies want to maintain long lasting relationships with their clients they have to learn not to be commercial, they have to humanize themselves. They have to figure out how to pull information from real life conversations (like a friend giving a recommendation to another friend) to understand what truly impacts sales.
STRENGTHS AND LIMITATIONS OF FRAMEWORKS
Frameworks are useful to understand the social challenges companies are facing. However frameworks do not help to find the right words to use with customers, the right games to offer them, the right activities to suggest them. Getting along socially with somebody is an art that needs much more than frameworks and guidelines to be performed. In this art, great content creators are likely to win because they present themselves to individuals as worth talking to. Assessing the strength of a network requires looking into its reach, frequency, interactions, diversity and information shared.
IS THERE ANYTHING AFTER ADVERTISING UNIT?
So far marketing expenses have been monitored using different ad units (CPC, CPA, CPM) based on the sales funnel (discovery, discussion, decision)… Is this still relevant in an environment that is based on conversations? Can we still measure the true value of social initiatives only by purely quantitative measures? Is social more about leading to recognition/getting the word out, rather than leading to action? Are there risks to be misled by “casper” engagement (e.g. facebook likes that are fake)? Talking about something or somebody is not necessarily a winning criterion. Ron Paul is a funny example of that reality… Even in real life there is a difference between declarations and inner beliefs or emotions. Until someone is able to evaluate the real impact of a social marketing campaign, ad units are still relevant. They can be twisted a bit (e.g. page views are not relevant to social gaming), they should get closer to actual sales metrics, but they shall continue be key.
IS THERE GOING TO BE A “NEXT BIG THING”? WHAT’S NEXT?
One shall always be prepared for the arrival of the next emergence of large technology companies. While Facebook is likely to continue growing exponentially, other players may enter the space and grow even faster in slightly different markets. In fact, what’s coming next may not be a tech transition; it may very well be a social one. Among ideas cited, there were:
o Exponential use of social platforms
o Growing decomposition of social platforms
o Better tools to navigate throughout your web social history
o More and more links between digital and real life
o Increased individual customization of web experiences
o Local digital commerce, daily deals
o Intersection of social and TV
CUSTOMER ACQUISITION
SOCIAL IS NOT JUST ANOTHER CHANNEL FOR CUSTOMER ACQUISITION
Social being about brand building, it is hard to sell to marketers who are overly impatient to acquire new customers. But social is not only about building awareness, observing assessments and recording actions. In fact, in the lifecycle of a customer’s interactions with a brand, purchase only accounts for 1%!
IT IS ALL ABOUT LISTENING
Marketers must put more effort into the interactions prior and following the purchase. They must “listen” to conversations people are having online about their brand. This is how they will be able to identify potential brand ambassadors, who would then evangelize their respective networks on behalf of the brand. Once ambassadors are selected, marketers need to invite them to lead their own local conversations, hence introducing some sort of social currency that allows advocates to get their name and ideas out, and encourages them to keep doing so.
CHALLENGES IN THE CURRENT LANDSCAPE
What used to be people on mailing lists is now a group of Facebook fans and twitter followers. Marketers now use likes and hashtags to segment and send the right messages to the right people.
Facebook’s use of sponsored stories, adding verbs to the social graph, proves 50% more efficient than traditional online ads. However, the current landscape presents challenges for marketers: with twitter, the dynamics of a conversation are lost in a stream, and with Google+ and facebook, conversations are people-related rather than topic-related making it hard for messages to travel really far and be effective.
Other techniques exist. With SEO (Search Engine Optimization) marketers can multiply the funnel and access a larger base, while with social media, they can multiply the context and have someone else pitch on behalf of the brand.
FINAL THOUGHTS
o Facebook is like a car with gasoline: people don’t like driving it but they still do… eventually, they will stop
o Context-based media (including local) will explode and social platforms will fragment as people relish their individuality and move towards platforms that cater to their needs
o Vertical social networks will rise with dramatic differences between verticals as some
categories are inherently social, others not
o Real time engagement and communication will be key
o Business models around ecommerce will expand
CUSTOMER RETENTION
CUSTOMER RETENTION BEFORE SOCIAL
Pre-social CRM used to be thought as the big fad. With social, social CRM enables much more powerful things than traditional CRM.
“YOUR CALL IS NOT IMPORTANT TO US”
Most companies are being reactive about social rather than pro-active. Social media nowadays is a public source of complaints, which gives people an outlet to publicly complain and threaten brands. Overwhelmed with conversations exposing their brands and with attempts to make things right publicly, companies are losing sight and forgetting to fix the problems that actually caused the complaints.
Companies may be looking for situations where their competitors are losing sight as part of their own customer acquisition strategy.
LISTENING AT THE OUTPUT IS NOT ENOUGH
Companies that do this well know who their customers are or are likely to be. How much listening need to take place to reach this state? What is the cost of listening? Tools such as Radian6 offer to pull the right data for a much cheaper price than organizing 20 focus groups.
Customer retention is not a data collection problem. In fact, the problem is not that there is not enough data but rather that companies need better data…
Some companies (like Zappos) are set up to respond to customer service demands, but most companies are only set up to collect information. To act on complaints, there needs to be loyalty/rewards systems in place, along with specific business processes… Organizations not only need to have people responsible for customer retention initiatives and responses, but they need to actually empower them to make decisions quickly on their own.
CHANGES TO LOOK OUT FOR
o Super narcissistic new generation that shares more and more often
o Universal (time and space) access makes it easier to share
o Overflow of people to interact with, as well as brands and message to process and choose from
o Social media provides an infrastructure (as opposed to a destination) for storing, sharing and accessing all this data, and just like email it will become a platform that we cannot live without
o Companies need to be in the right place at the right time to listen to the customers (or everywhere at once!)
REVENUE GENERATION
MONETIZATION IN EXCHANGE OF A MEANINGFUL EXPERIENCE
Social is a real opportunity for online services to try predicting organic marketing results and decrease spent in paid ads. In social media, interactions are contextual and happen real time. What makes people go beyond the thinking that they are being marketed at by brands is the value they are deriving from products and their consistency with expectations. People like neither interruptions nor advertising, but they would happily trade experience for relevancy and rewards.
Because they are already experiencing significant information overload, consumers are somewhat reluctant or slow at integrating new tools into their lives. To avoid the “cold start” problem, encourage new tools usage, and speed up the learning process, it is key that a new tool instantly gives good recommendations even though it takes a certain amount of time to build complete preferences information for more meaningful suggestions.
In fact, knowing what customers like and don’t like helps bridge the gap between online (where purchase intent is recorded) and offline (where most purchases take place). And because offline social is very impulsive, there is a huge upscale opportunity if manage to push that behavior forward.
BRIDGING THE OFFLINE / ONLINE GAP
Data in the offline world is analog. Wouldn’t it be convenient to keep a centralized database of all offline information that consumers could tap into to make informed decisions? The major challenge against “big data” is to convince brick and mortar stores to change the way they do
business. There is a need to educate the people that control the offline experience on how closing the gap between offline and online would be beneficial to business.
Enabling technologies, such as Groupon that is getting consumers used to purchasing something online to use later offline, are big catalysts in revenue generation and help understand purchase influence circles. This means offline stores could soon benefit from data analytics similar to what Amazon developed for its online store.
The development of the mobile industry is another technology advance and trend that contributes to bridging into offline and to supplementing the online experience.
WHAT AND HOW TO MONETIZE?
Social media is an enabler of monetization. Monetization does not necessarily happen directly on social media sites, but social often contributes to generating revenue from other places. To understand what to charge for online and how to charge for, online marketers therefore need to look at what is happening offline. In a utility model or software as a service, people would probably be open to paying for a service they are already paying for in real life. For example, people are used to
paying for fun in real life since the entertainment is conditioned that way. On the contrary, they are not willing to pay for information.
The more people use a tool and the more invested they are, the more likely they are to pay a premium for more volume or access to additional functionalities. This is especially true if the site is prone to scaling by network effect, as the cost of switching increases with network lockdown.
CLOSING REMARKS
Online to offline progression seems to please consumers who like the value they are getting out of the growing volume of offline data that is gradually brought online. And mobile phones (along with
other tools) are pivotal forces pushing towards social offline digital commerce.
