Presented by Lewis Goldman, New Media Consulting, NACCM 2010
There is a lot of hype around social media. The key is that this is 2-way communication.
Fewer and fewer people are contributing, and so the rate of new content development is declining. For example, 90% of Twitter content is produced by 10% of users. Therefore, influencers are so critical because there are many more voyeurs than contributors.
Lewis shared some important statistics that illustrate the impact of engaged customers:
- -Ratings and reviews lift conversion rates by 56%
- -71% of people take a friend’s recommendation
- -Facebook is the 2nd largest referral site after Google
- -Coupon sites, which are really social sharing sites, are becoming much more prominent
There are 3 unique elements of social media:
- Ability to find out exactly what the customer wants: Customers are very explicit with their preferences. For example, Pop Tart is growing tremendously – reinventing the brand through social media and being relevant to teens again. 1-800Flowers introduces new products and services through social media, getting feedback and tuning the offering to hit customer expectations. So the lesson is to create a platform that allows you to easily market to your audience. Surveys can be done quickly and easily, accelerating pace of change, by getting feedback from your loyal customers, and build a place for your customers to go to get that feedback.
- Advocacy and pass-along are facilitated: 100’s of Influencers can be much more important than thousands of Facebook fans. Nurture them so they can advocate for your brand. March of Dimes enables mothers to share stories. Zappos product reviews are growing every day.
- Ability to get real-time feedback: This is a double-edged sword, as the expectations to change based on that feedback have also accelerated. When there is a problem, people have the ability to tell thousands and thousands of people. 1-800Flowers uses Twitter to monitor customer satisfaction, and as a result 2/3 of Tweets are positive, whereas for their primary competitor 2/3 of tweets are negative. When 1-800Flowers resolves the issue there is frequently an updated tweet that indicates the problem was solved. Customer Service needs to be engaged here. Can provide different channels for example on Twitter, for service, offers, and company news.
The process highlights the need for authenticity: Be honest and transparent.
Monitoring the conversation (“buzz”) is becoming easier through resources such as Tagcrowd.Com, which helps this process by visualizing word frequencies in any user-supplied text. Remember that the conversation changes, so it is important to do this on a regular basis. Don’t just provide snapshots: Trend the information, so you can see over time how you are being perceived on-line, especially against competitors.
Loyalty programs need to reward advocates in the same way they reward repeat purchases. For example, your best customers get a survey panel that rewards them with points, asking about user interface changes, positioning, product development, promotional offers, and competitive feedback.
Example: 1-800Flowers monitored the blogosphere to find influential bloggers that they wanted to engage. They found about 100 “Mommy Bloggers” that had a large following, and exposed them to the message and offers in advance of Mother’s Day, specifically creating a campaign called “Spot a Mom”, which was highly promoted and easy to share. As a result, sales expectations were exceeded by 9%.
Another example is from Starbucks: www.mystarbucksidea.com has significantly supplemented their own product R&D. A growing area called pCommerce (participatory commerce) is the next wave beyond eCommerce. Community members can comment on each other’s ideas, which facilitate the process for Starbucks R&D to filter through the most valuable contributions.
This blog was written by Steve Bernstein and is co-posted with the Customer Insight = Revenue blog.