Archive for August, 2009|Monthly archive page

Institutionalizing Social Media for Large Organizations

My friend, Jeff, made the observation that social media has the ability to change the rules for the little guy. Kind of like boxing, a good small man can be a larger man, but a good man can beat a good small man. Size still matters, but skill can also still be a game changer.

Same in social media, first mover advantage does allows small players to get traction, but that does not preclude secondary major entrants from catching up. It may cost them more, but unless the new entrant creates barriers to entry that are sufficiently difficult to overcome by entrants buying their way into a market, they better have a niche or market integration strategy to adjust.

Couple this with my recent conversations about the mix between developing intuition and validating assumptions in new product development. Same set of assumptions and market dynamics, but the mix that an entrepreneurial company will balance approach to the market versus a mature player is far different. The 80:20 rules still apply, but the entrepreneurial company will focus the 80% on intuition and the mature player will focus 80% on validating assumptions.

Hence the time to market and the difference in approach between small and large players in social media. Small companies can jump on participating online. See a unfulfilled opportunity, jump on it. Mature organizations have to weigh the impact on existing operations, customers, plans, budgets, etc. May see the same opportunity, but when you are moving a small army, it isn’t as easy as “picking up the tent”.

So how does this map to social media? Mature corporations have mature planning processes. Some are good, others bad, but the reality is that large organizations weigh risk management equally as important (and some cases more) as innovation. Small company fails, you lose a few bucks and you move on. Large company fails;  they can lose a lot of customers, money, jobs, and investor’s money. Stakes are higher, you gotta make sure that you cover the bases.

Social media represents more of the innovation side of the 80:20 rule analogy above – innovation. It has the ability to be disruptive. Social search taps into the emotional side while search engines & standard search tap into the intellectual side. If I trust person A’s opinion on a topic and follow their links to find a product, that is actually an emotional decision. Yes, I intellectualized the decision, but emotionalized the “trust”.

Social marketing, evangelism, social networking, social CRM, collaboration, and all of the related terminology are really about systematizing the human interactions that have been lacking on the web. Websites were about content. Now they are about content, relationships, sharing, collaborating, and communicating. It is what we do every day offline, just moving more online. Great opportunity to fix a lot of poor customer relationships from over-automation. Think every bad call center experience that you have had; voice prompt hell, untrained customer service reps, crappy scripts, and frustration.

Now, think about that one shining example of the customer service rep who actually could figure it out and saved the day. They were bright, articulate, knowledgeable, and had a real conversation about you. In a sea of bad interactions, the human element shines through. That is the beacon on the hill for social marketing. Think agile manufacturing for “customer relationships”. My mantra these days is that you cannot have a relationship with a system and transactions don’t make relationships. Relationships are built on interactions; good ones and bad ones, but your relationship is the sum of your interactions (online and off).

Put this together and you will see that large organizations need to build the business case and the strategy for “how to move the army”. They need to institutionalize planning around social media to incorporate the impact on the organization and to validate the planning assumptions. Many already understand the innovation, but getting consensus on the direction requires some assistance in translating the social media innovative vision into call-center, product management, operations, finance, sales, and senior management strategic planning.

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A Shameless Self Promoting Plug

I had an opportunity to be interviewed on the Atlanta Business Radio Show this morning. Can’t miss any opportunity to evangelize on social media and marketing. Here is the link to the podcast (my portion of the interview starts about 15 minutes in):

http://atlantabusinessradio.businessradiox.com/atlanta-business-radio-interviews-nicole-siokis-with-momcorps-and-social-marketing-strategist-matthew-rosenhaft/

Actually, I want to thank my hosts, Amy Otto and Lee Kantor, for a truly fantastic experience. It was my first radio interview and they made it very easy with the right softball questions to help me out. Also on the show today was Nicole Sioskis, regional owner for Moms Corp (www.momscorps.com) is a specialized matching service for professional mothers (and some dads) who desire to work part-time or on a project basis with organizations that need high-caliber talent on a part-time or project basis.

Help Wanted: Grammer Checkar

A friend of mine offered to edit my blog. He tells me he reads my blog to get caught up on the latest trends in marketing. He also tells me my grammar is horrendous and I need an editor. He has begun to send me edited versions of my blog posts. The fact that he is a professional writer does lend credence to his claim regarding my grammar. In my defense, I review my blog posts at least twice before sending and my grammar mistakes still get through.

In my day job, I always have editorial reviews for that reason. If I can get a software developer, even better. They are known for their grammar skills. I guess bug fixing at 3AM will sharpen your syntax and grammar skills….

My friend also needs help on one of his projects. We swap services; though full disclosure, there is no monetary value placed on either of these services. But, I think that there is a lot more of the “swapping of services” with the rise of social media.

When I was in grad school over a decade ago, my paper was on first mover advantages over the web. I wrote a paper on the challenges that near zero distribution costs would have on entry barriers for software companies.

Now, I am seeing the impact that near zero distribution costs are having on services. The barter economy preceeds the money economy by thousands of years. So, believe me when I am telling you that; I am not running into the room telling you that I realized that I just figured out why apples fall from trees. (Mark, good luck fixing this sentence)

I think the rise of social media is lowering the costs for matching the buyers and sellers of services. Part of the challenge has been in finding good information to identity and determine the quality of the service providers. Hence the need for an intermediary who played the role of market maker who could validate the quality for the buyer. Recruiters were a good example of this trend. Your neighbor who recommended a tree service was another.

Now, we are seeing the rise of online service provider rating services who allow users to directly access the reviews by past customers. We are seeing notices for assistance directly on social media sites; i.e. I saw a linkedin question to find a technical support specialist for a specific engagement. Social media lowers the communications costs associated with matching buyers and sellers. This is not a new trend, but we are seeing the extent that it is becoming more mainstream.

Hence, my professional writing buddy, who trades editing for a professional review of his marketing website. The ability to hit your rolodex (now virtual rolodex) for a subject matter expert is becoming more extensive and extendible. Additionally, the ability to find reviews of those providers at the same time is making services transactions easier to conduct. With paypal, neither party needs to even leave their homes… or change out of their pajamas. Very scary thought….

Wish List for Social Marketing Metrics

I get requests to review social media related platforms all the time; functionality, metrics, and integration. Some of these platforms are really good and some of them will die a quiet death. I make it a point to not discuss any specific platforms just because I want to stay strategic in this blog. But, I think there is value in outlining what I am looking for in the way of platform measurement capabilities that will support my social marketing strategy. Here is my wish list of activities that I want to measure and for which I am trying to collect tools; some of which is available and some is still not ready for primetime…

  1. Automatic Chatter Analysis – who, what, where, when, why, and how with comparisons, triggers, analysis, and a dashboard.
  2. Synchronization of My Social Networking Contacts – cross platform and multiple networks with the ability to start with one and find someone on another; i.e. uploading a twitter contact and have the ability to synch with LinkedIn or Facebook or email.
  3. Social CRM – then do that for all of my company’s contacts, dropped into a CRM system which I can then manage multiple contacts, campaigns, and relationships
  4. Online Community Lead Scoring – apply lead scoring to my own hosted community. I want to be able to identify when activities in the community indicated greater interest and send that into my CRM or multi-channel marketing system for follow up.
  5. Multi-Channel Reach Measurement – include social networking channels, twitter, blogs, back links, SEO, & SEM. Not just email and web analytics.
  6. Social Influencer Scoring – compare the various potential lead influencers to compare; blogs, communities, social networks, twitter, forums, sites, etc.
  7. Lead Source Analysis – Need a better way of being able to identify and track indirect sources for leads. I can use the latest web analytic tools to identify pages, but I need a way to elevate that to identify the sources of leads to compare and contract; i.e.  2nd generation re-tweet triggers a wave of people to our website. I want to be able to match the tweet to the twitter user to the lead. This would require some serious integration between social media and web analytics with a healthy dose of marketing legwork.
  8. Strength of Social Marketing Channels – Once you can track, then you can evaluate.
  9. Cost of Lead Acquisition by Social Marketing Channel – This is the Holy Grail; to measure the cost of lead generation by channel. Cross match it to revenue from leads and lead source and you have ROI.
  10. Social Marketing Brand Strength – Measurement of reach, calls to action, and actual action. There are some metrics out there with proprietary formulas, but this is still nascent.

If automatic ROI calculations are still some point off into the future, then what can we measure today and how can we justify our expenditures on Social Marketing? My answer is that it depends on the “how’s”; how big, how complex, how sophisticated, how much is your budget, and how much time? You can track a great deal with the tools currently available which is more sophisticated than much of the traditional brand-oriented mass communications channels that exist today. So, the good news is that we are moving in the right direction, but it is still more art than science. Well, at least until the platform vendors provide the above capabilities.