Given everything that is written on Social Media, I was surprised to learn that three quarters of marketers have $100K or less budgeted for social media marketing. This is based on a Q4, 2008 Global Social Media Survey from Forrester of companies with 250 employees or more.
So why is there so much ink and so little spend?
Maybe because in a recessionary time where everyone is ROI focused, marketers don’t think of social media as having a payback? But it can if it’s used correctly. Social media should start to become “a” source of leads for your marketing team. Why? Because conversations are taking place on the topics that you have experience and expertise in. And if you’re not the one leading those conversations, then someone else is positioning themselves as the trusted expert in your area of expertise. So what can you do?
You can embrace the shift in media consumption and learn a new set of skills to be competitive. You can start by making a commitment to it. It’s inexpensive but it takes a considerable investment in time.
First, think about who you are going to target (be specific) and what your positioning/area of expertise will be. At this point you will want to dive in but don’t start yet. If you haven’t already, set up a Google Reader Account and spend several weeks interacting with others and their blogs. This will help you get a sense for what works and what doesn’t before you start blogging yourself. Once you start writing, get at least 50 posts completed before putting up your blog. Once up, you can re-purpose content from others so you can easily create 2-3 new posts per week.
Now you can start driving traffic to your blog through Email Marketing, Twitter, LinkedIn, and Facebook. Your blog should be the core of your social media presence and everything you do should drive to it.
Join as many relevant groups as you can and push your content to establish yourself and your company as a leader in the space. The purpose of social media in new business is to start conversations with prospects. Each comment left, email sent and tweet posted has potential to be a lead but your initial lead identification goal is only to start a conversation about the topic…not to sell. Once a conversation is started, there are some Rules that should be followed to increase your chance of converting:
• The conversation should have at least five back and fourths before you show any effort toward identifying a pain/challenge.
• Demonstrating empathy and understanding is key to conversations in social media around a pain/challenge for new business.
• Suggestive techniques can easily be used to suggest potential solutions to a problem from past experience, insight or knowledge…and it’s great if you can link back to a blog post on the topic.
• Once you’ve built your trust on the subject – then it’s time to move forward selling. But avoid selling through social media – take a lengthy conversation off-line and suggest a call or meeting.
While time consuming and awkward at first, once you are up and running, it’s really no different than other forms of prospecting. You’ve identified a pain or challenge, you’ve supplied a suggested solution, and then you have a prospect to work.
Like any other loss, people progress through difficult times like a recession in stages. The first stage is “Distress” which includes feelings of anger and sadness. I think we are past that.
The next stage is “Acceptance” which is eventually followed by the third stage: “Moving On”. While my colleagues and I would assert that consumers are in stage two, we don’t believe anyone will be “Moving On” anytime soon. Given that, marketers should consider how they position themselves for today’s mindset.
“Acceptance” means consumers are now feeling less anxious and more in control. They feel less wealthy but also less helpless. They know what they want, what it really costs, and where to get the best price. Wallets no longer expand to fit their wants but rather consumers have reduced their spending to fit their wallets.
In fact, according to The Futures Company, consumers are rationalizing their purchases to fit within four strategies:
Coping Daily life must go on and to cover the basics like rent and food, consumers are adopting strategies to make their money stretch further. They are looking for the best “value” and are willing to shift to alternatives including private label products where necessary.
Retreating At the same time, consumers are gravitating to the safe and familiar, which means all things being equal, they prefer the emotional comfort they derive from their favorite brands. Starting the day with a bowl of the store brand cereal may deliver the same nutritional benefit as their favorite national brand, but with less of a psychological lift.
Escaping These days, escape does not mean a well-planned holiday in some exotic location. More often, escape is an affordable luxury that liberates the mind, at least for a moment, from daily pressure and financial stress.
Risk Sharing Most purchasing of durables is on hold. But when consumers need to purchase a big-ticket item, they are looking to minimize and share the risk. To stimulate the moribund car market, for example, some companies reassured prospective buyers with the promise of a full refund if the customer were to become unemployed.
With plenty for people to still worry about like unemployment, troubled mortgages and diminished investments, we won’t be moving into Stage 3 anytime soon. To grow share and win loyalty, manufacturers need to ask themselves how to best position their products and services against these four strategies.
Enjoyed Cliff Kuang’s piece (http://www.fastcompany.com/blog/cliff-kuang/design-innovation/print-medi...) on why ads might be to blame for the crappy state of Internet advertising. I think the key words in his piece are “useful functionality”. While I agree that ads that don’t just sit there are better overall, the key is in defining what constitutes “useful”.
Advertisers need to spend more time figuring out WHAT the people they are trying to reach WANT from them WHEN they reach them. In other words, just because you add a bunch of functionality to a banner, doesn’t mean your click through or the actions someone takes after the first click will be any more valuable to your business.
Advertisers are best served when they define what role the online ad plays in the purchase funnel? Is it to convert people who are active prospects or is it farther up the funnel where people need to be engaged in a different way. Often they are truly up the funnel but yet the ads are treated as if people are ready to buy.
Today, there are many opportunities for online marketing to be a “service” to a consumer and not necessarily sell. For example, we built a flash player for Microsoft that enabled them to stream live useful content to small business owners and at the same time syndicate it across the web. It lived in a banner unit that expanded when clicked on to reveal the complete player. Engaging people in that way exceeded our product demo goals 5x. And I guarantee it worked better than a banner with a “get your demo now” message.
My point is, when advertisers get too obsessed with click-through rates, banners become very direct response focused and brands can miss an opportunity to engage the a prospect in a deeper more meaningful way.
I can’t think of many lessons that I have learned from Politics but we should take a lesson from the Obama administration. To succeed in tough times, you need to be committed to a “Big Purpose”. In Politics it would be easy to make decisions based on short-term polls and criticism, but rather than do that, the Obama administration has stayed focused on his purpose for running the first place…to “change the world”.
Likewise, in tough times, it’s easy for CMO’s to get caught up in line of site short-term results. But companies who focus on the “bigness of their purpose” will continue to standout in the 21st Century.
Having a big purpose is not a new idea, just one that’s easily forgotten in tough times. A former client, Gallo, was started 75 years ago with one purpose: to make a wine for every table. A big purpose but one that continues today and while not published; I would guess their share of the US wine industry to be in the neighborhood of 40%. Not bad.
For a long time, a redesigned bumper or grill have been masked by Detroit slogans like “An American Revolution. Quite a contrast to a company like Better Place (www.betterplace.com) whose purpose is to catalyze the transition to sustainable transportation. Or Google who set out with one purpose: to create “the perfect search engine” for organizing the world’s information and making it accessible.
Sounds easy but it’s harder to do. As I write this, people everywhere are questioning whether the Obama administration is taking on too much. Seems to me, you have to do a lot to “change the world”. Likewise, as difficult times put pressure on you to trade your big purpose for short-term performance, remember one of my favorite quotes from Michelangelo: “The greater danger for most of us lies not in setting our aim too high and falling short; but in setting our aim too low, and achieving our mark.” Over the coming months, companies will be more than ever eager to find elegant and inventive solutions to their problems, but success will depend on the size and compelling nature of the idea itself.
I believe in the value of innovation and creativity as a business driver. I think it is one of the last competitive advantages. And running a business, I always find that “what gets rewarded, gets done” so I am always thinking about how to link the two.
I’ve been reading a lot lately about companies naturally trying to cut their costs during these tough economic times and marketing is a place where they usually look to find savings. One such article (http://adage.com/article?article_id=136266) discusses how Coke is moving to a pay for performance compensation model in which they decide the “value” of a project and then their agency partners have the opportunity to make a profit only if certain targets are met.
Don’t get me wrong. We’ve put a number of pay for performance programs in place that have been very effective and I advocate for getting paid for the value of the ideas you bring and the business impact you create. If companies want innovative ideas to drive their business, they have to get away from the model of “value equals time spent”. But this type of model can incent safety and short-term performance rather than innovation and long-term growth. Why?
1. Brands and relationships with consumers are built over time
2. Not every innovation works but because the profitability of every innovation is eroded over time, you need to keep innovating.
3. Much of marketing today is designed to be a service to a consumer.
Companies can have both but one-size fits all incentive programs won’t work. You can certainly reward short-term performance indicators but you also have to find ways to reward innovation and creativity…even when it doesn’t work. Because the one idea in five that really takes off will offset the cost of the four that didn’t.
I would imagine that if I worked at Apple, for every iPhone and iPod, there are several others on the floor. It’s the same in marketing. Brands need to incentivize partners to find new product connections and innovative ways to create engaging experiences for consumers. Some of those will work and some won’t but if like Apple or Method or any number of other companies that believe in creativity as a competitive advantage, you will reap the rewards.
I just read that Neilson Online (www.nielsen-online.com) has found that 60% of people who sign up on Twitter abandon the service. In fact Twitter’s retention rate is around 40%, which means that only 40% of the people who visited Twitter last month will come back this month. And that number is higher since Oprah joined. So what’s the big deal? Well, according to Nielson, if their retention rates stay around 30-40%, they will never reach more than 10% of online consumers. So what’s missing? Why is the hype so much greater than reality?
In my view, there are two key metrics in social media that are needed to make something work. Influence and Engagement. Twitter needs people with large sphere’s of influence who have engaging content. That’s why when Oprah joined Twitter, their retention rates went up. She has a large following that finds her content (even in 140 characters) interesting and engaging. And while she still trails Ryan Seacrest and Ellen for followers (http://wefollow.com/), she has the influence and visibility to pull people in. So to increase the reach of Twitter, Twitter should run a recruitment campaign and then promote the engaging tweeters like Apple promotes apps to keep us engaged with our i-phone. Imagine the retention if Craig Venter, Jon Stewart, Tiger Woods, Salman Rushdie, Rick Steves, Eckhart Tolle, The Pope and Steve Jobs were tweeting regularly.
What drives us to trust companies? I just saw a study from Edelman called the Trust Barometer. It talks about the lack of trust people have in business and governments and how it’s changed over time. For some perspective, the dictionary.com definition of trust is:
Noun
1. Reliance on the integrity, strength, ability, surety, etc., of a person or thing; confidence.
2. Confident expectation of something; hope.
Verb
1. To have trust or confidence in; rely or depend on.
2. To believe.
3. To expect confidently;
Given these definitions, its no surprise that 77% of people in the study trust companies less than they did a year ago. But, there were two things that did intrigue me. The first is that when overlaid together, trust in U.S. business closely follows the S&P 500…almost exactly. Both go up and down together. The second thing was that global trust fell for every industry except technology.
With respect to trust and the stock market, the study surmised that trust is key to restoring investor confidence. And it makes sense that technology is not in the bull’s-eye of blame for the current recession like it was in 2001. But I think there is more there than these assertions.
I wonder if it isn’t the other way around? Stock performance is key to restoring trust. We all know the saying “if it ain’t broke, don’t fix it”. As people grow confident in the certainty of a payment like a return from our investments, most of us don’t question anything and trust that it will continue. Look at Madoff. Some very intelligent people invested with him. Despite the fact that he continuously beat all other investment performance by a mile, nobody questioned it. Instead we believed and trusted that it would continue.
Could the same be true in technology? Could it be that much like the stock market, as long as tech companies like Apple continue to produce products we love, we trust them?
Maybe we should trust ourselves to question what seems too good? And that trust should be based on knowledge and information? You can see the Trust Barometer at (www.edelman.com/trust) and it would be interesting to hear what those of you who work for tech companies think.
Is change really coming to America? After all we did elect a President who ran on the platform of change. I do however wonder if we as Americans really have the capacity to change. And if we do, why are we so slow to change?
Is it because we haven’t had strong leadership driving change? Personal political views aside, I think its safe to say that throughout history, we’ve had some good leaders so I don’t think the speed at which we change as a country is driven solely by the strategies set by our leaders.
Is it because we have the freedom not to change? After all, we can choose to change or not change without fear of retribution. This could again be part of it but I still don’t think it’s the main reason.
I would put forth the old adage, “no pain, no gain”. I think America, as a society is slow to change because the pain of not changing isn’t greater than the pain of changing.
Why, well look at the auto industry. Until now the pain of not changing has been less than the pain of changing. Gas hasn’t been $8 a gallon and we haven’t yet run out of oil.
Yet, despite the fact that an American company called Better Place (www.betterplace.com) has put together a holistic and new infrastructure for electric cars based on the model used in the mobile phone industry which makes owning electric cars more convenient and more affordable than owning gas powered cars – we don’t hear much about it.
Other countries, some of which seemly have very rigid cultures have been much quicker to change. Israel, Denmark and Australia are all moving forward with the model before the U.S. It seems that their governments recognize the no pain, no gain theory. They are taxing emission cars at much higher rates (100% in some cases) than electric cars to instigate change.
Maybe the tough love message sent to Detroit in the past few weeks was meant to make the pain of not changing greater than the pain of changing and change will truly finally arrive…in the auto industry at least.
There’s a lot being written about how to survive the down economy but I think something is missing from the dialogue: how to create a culture that thrives during it.
Yes, intuitively most people know that to truly excel during a down time, we should be looking for opportunities to innovate rather than retrench. Think about it, in recessions people are much more likely to reconsider a brand because they want to feel they’re getting the best value. In fact, Roper is calling this time the “big reassession”.
But rather than create new value through innovation, companies are quick to cut costs or stay the course. This just gives people even fewer reasons to buy and the recessionary laws of gravity take over and drive companies down.
So why don’t more companies innovate? Or use creativity to it’s fullest potential? I recently attended the TED conference (www.ted.com) and had the opportunity to see author Elizabeth Gilbert give a great talk (http://www.ted.com/index.php/talks/elizabeth_gilbert_on_genius.html) on the impossible things we expect of creative people.
What occurred to me is that most companies don’t know how to nurture creativity. They put too much pressure on the organization and the individuals within it to “be” genius. Be creative. Be innovative. And do it while cutting costs. I don’t know about you but I’ve never had a great idea under that kind of pressure? It’s not unlike what an author goes through after a hit book or movie. The pressure to “be” genius again is immense and paralyzing. It causes a creativity crisis so to speak. What if as employers, we could create a culture where we enabled people to “have” a genius from time to time? In other words, what if we created an environment that nurtured innovation, recognized genius when it presented itself, and celebrated brave failures when the genius failed to show up for work?
I suspect that innovations would flow and the Return on Innovation would be much greater than any ROI achieved through cost cutting. We’re working hard to continue to foster that kind of culture here. I’d be interested to know what people in other industries think about avoiding a creativity crisis in their business.
