A new state of mind for businesses
Social media, although it is pervasive in our lives, is often still frowned upon at the executive level in terms of investment. How do you measure the benefits? What should the KPIs be? And how do you tie it to initiatives that drive success for the organization? All of these questions are critical to business leaders around the world. In this column, I will explore how organizations are deriving business value and driving success and innovation for both their customers and employees using technologies such as Hadoop, MapReduce, IBM Content Analytics, and the IBM big data platform.
Gone are the days when you could just focus on page rank and first-page positioning on search engines for targeted keywords. These days, it’s not enough to pray to the Google gods–—you also need to make offerings to the Facebook gods, the Twitter gods, and a variety of others. If social media keeps evolving at this rate, we may be praying to a million gods soon!
Our goal: cut through all of this confusion to attain the ultimate social nirvana. Nirvana is a state of mind that results from a natural reordering of the mind and body via discipline. It provides a sense of great peace and a unique form of intelligence. Social nirvana is the ultimate state for marketers because it means they have reordered traditional organizational thinking and leveraged advanced data management technologies to make the most of the intelligence that’s available through social media.
Social media is a big part of marketing today, and it will play an even bigger role in the future. It lends itself to helping you build an online reputation—and done right, it is a great way to enhance presence and status. The caveat, of course, is that done wrong, it is a great way to ruin your reputation by coming across as a spammer and create some very bad press for your brand.
Rule number one for interacting with customers on social media: keep it honest and 100 percent transparent. The most important thing to remember is that you are dealing with real people online, not just search algorithms. These people are interacting with you on their personal time, and they all have unique personalities, opinions, and preferences that they’re not afraid to share.
Facebook had a staggering 901 million active users at the end of March 2012. Leveraging this enormous population to strengthen your brand has become a mandatory part of conducting business today. But just how much is each Facebook fan worth? How can you translate users to dollars and cents?
At a recent session with IBM retail clients, the conversation focused on the value of a Facebook user. Of course, “value” means different things to different people. But one thing is certain: if you do not have a Facebook user following on your fan page, that non-presence can be extremely harmful and detrimental to your brand image and business overall. This fear is what is driving many businesses to jump on the bandwagon.
Fear can cause overreactions, too. Some companies are taking the desperate measure of using bulk buying features to help them drive up their fan numbers, paying as little as USD50 for 500 “fans.” I question the value of these fans. I believe you should focus on acquiring genuine fans who are actually interested in your brand. These are the fans who will give you insights and help drive your business. They have longevity, and they will help you acquire even more fans over time.
I recently discussed this question of quantifying the value of a Facebook fan with an international bookstore. This bookstore is using its Facebook fan page in an extremely savvy and interesting way to gain insight into what its customers want to read, with specific emphasis on authors and titles in specific locations. The company then stocks books based on demographics and geography in the local bookstores. For this company, the value of a Facebook fan is quite high—so its goal is to reach a million Facebook fans quickly. There is even a ticker at the reception area of its headquarters that displays the current number of Facebook fans!
Another retail business is using Facebook to ensure that inventory levels for clothes, makeup, and shoes are driven by the fan-based inputs in specific underperforming geographies. This company’s belief is that by stocking the appropriate and desired inventory levels, it can reduce sales and markdowns and thereby improve profitability. This is a great use case for social business; by connecting with highly engaged customers in a meaningful way, retailers can stock inventory based on demand in near-real time. And this is just one of countless examples of businesses leveraging Facebook to gather insight into consumer behavior.
With so much insight to be gained through Facebook, incenting people to follow your business there is a no-brainer. I have seen many businesses, including IBM customers, use “fangating”—a technique where the page requires Facebook user to “like” the page before sweepstakes, coupons, or other content is displayed—in an effort to acquire fans.
One European alcoholic beverage brand provides an interesting case study. This company ran a Facebook campaign to gauge its audience’s reaction to two options for the packaging of a new beverage. Marketers created a contest where the brand’s fans could vote on their favorite packaging. With a deadline and some prizes thrown in to entice fans to participate, the contest was a huge success. The option that received the most votes became the packaging for the new product. This is a great example of how Facebook gives brands the ability to leverage an enthusiastic, engaged fan base to drive product development, product initiation, and launch. This type of engagement strategy can really get fans talking—and not just to you, but also to each other.
Has your company embarked on the social journey? Are you a social leader? What are your recommendations? Please share your experiences in the comments.
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