Social media for fun and profit

As we now have a social media agency (Jam) in the building, it seems a bit presumptuous to pretend to be an expert in this field. Nevertheless, some recent research work I have undertaken for a prospective client highlighted a few interesting lessons learnt by companies in the social media space. They are, in my opinion, worth repeating.

• Don’t talk about your product. Talk about your customers’ problems. P&G wanted to engage with 13 year old girls to sell more Tampax and Always. They quickly realised that no 13 year old girl wants to go to a forum about tampons, so instead they set up a forum where the girls could discuss and get help for all kinds of problems related to being a teen. Unsurprisingly, many of these were “growing pain” related, and often led to an opportunity to propose a sale. According to P&G the return on investment was 4 times higher than for traditional marketing, and the portal is now being rolled out to an additional 21 countries.

• Use social media to enhance your other offering. Oracle provides its sales partners with a bespoke service portal, (the OPN portal) – a key service, as partners are responsible for 40% of sales. However, to drive traffic and engage more widely, Oracle uses Twitter, Facebook, Linkedin and YouTube as “spokes”, driving traffic and engagement into the portal. According to Gartner, this has lead to reduced cost, increased confidence, higher employee participation and (not least) increased interest from the press.

• Don’t miss the externalities... Mystarbucksidea is fairly well known – a simple site built on Salesforce.com, allowing customers to contribute ideas as well as rate other customers’ contributions. After weeding out the silly stuff (topless baristas, anyone?) Starbucks probably learned a few things. However, (and this is my personal opinion), how valuable, really, is an idea for a new caramel-eggnog latte or more muffins with bran in? Is this not something that Starbucks could have figured out through traditional research or market testing? I feel strongly that the value of the community is the signal Starbucks sends to customers that “we are interested in you, we want to hear from you and we want to provide you with a platform”. Probably takes at least some traffic away from ihatestarbucks at least.

• Set the rules, but allow it to be personal. Other people have written about the fact that corporate blogs are often not personal enough. Indium is a company that manufactures alloys – hardly what you would think of as a natural for social media engagement, and solidly business-to-business. Yet the company allowed 14 engineers to start their own blogs, and clearly said that these were personal – they were done on the Indium site, but the words were “owned” by the engineers themselves. Oddly enough, this gave freedom – the bloggers did not have to clear every word with marketing and could respond more quickly to customer comments. Indium claims that this has lead to double-digit growth in sales, as well as a customer base that feel they know the company key employees much better

• A sense of exclusivity doesn’t hurt... One of my colleagues has repeatedly tried to get into the Financial Times’ “Long Room” – an exclusive community for finance professionals in the city of London. He has repeatedly failed. Allegedly, the discussion behind the closed doors is at the very highest level, and day-traders would probably kill for the tips and insight being passed around here. An even more extreme example is Opalesque’s “Trader Chat”, a community with only 150 members, all hedge US Traders and hedge funds. Needless to say, just paying the fee isn’t enough to become a member here.

Notice 3 out of 5 of those were business-to-business? I especially selected that to make another point - social media is not restricted to consumer engagement, and business people are no less social than other people. They love chatting about their business, regulatory changes, new markets opening etc. and if you can provide them with an edge, they are likely to go for it. If that edge somehow involves your product, that’s even better, isn’t it?

Image source