Forrester Research recently noted in one of their latest reports that four in five US adults online are participating in social media once a month. With this continued consumer adoption and year over year acceleration — many marketers, PR, and customer services groups at brands are attempting to transform their customer interaction tactics with customers and prospects. But what does this rush to be social really mean for brands? And are they pushing forward without having a clear line of sight about what levels of effort are required or what success metrics should be put in place? A recently published study reveals some interesting insights why social media is being adopted and the gaps between adoption and measurement.
The August 2009 survey by Mzinga and Babson Executive Education found that 86% of respondents from a variety of industries had adopted social technologies. Most said they were using the tools for marketing (57%), followed by internal collaboration (39%). Almost three in 10 respondents reported using social technologies for customer service and support.
Some addition data was reveal about headcount, support and funding - such as that it was more common that employees, either full- or part-time, were being devoted to working on social media initiatives (57% of respondents) than it was to commit budget dollars for social media (40%). Not sure if that second percentage mention was about tools or programs, but must social applications are being integrated within Websites or another site. While standalone community sites and third-party widgets were popular among 40% and 39% of professionals, respectively.
And despite widespread adoption and investment in social media, measurement of this investment and activity still lags. A scant 16% of those polled said they currently measured ROI for their social media programs. Now that is astounding in my opinion!! Additionally, more than four in 10 respondents did not even know whether the social tools they were using had ROI measurement capabilities.
Measuring the success of social media marketing can be a challenge, but using a variety of hard and soft ROI metrics can absolutely be accomplished. I would offer that volumes of conversation over competitors, sentiment (the good, the bad, the neutral), the level of reach and influence of those who are interacting with your brand, the amount of community involvement (answers or “love” your brand ambassadors give), call deflection, downloads, registrations, donations, etc are but some of the measures that can be used to construct a dashboard of success.
Before launching social programs beyond an experimentation phases it’s necessary to actually work backwards from what the end outcomes could or should be to ensure programs and consumer engagement tactics are aligned with tangible measures. Also, it is critical to ensure that brands put in place the time, resources and potential technology investments to scale the programs. Jumping in is not a easy as sustaining and scaling which must be done based on success and results which require measurement.
Came across some interesting new data from the e-tailing group in their first annual Community and Social Media Study. The report highlights that five out of ten social media tools have been adopted by more than 50% percent of brands and retailers, with Facebook Fan Pages leading the way at 86%.
Additionally, the study found three-fourths of the survey respondents feel brands have accelerated their use of, and commitment to, community and social media in the past six months.
The study found that the penetration of social media tools within brand and retailer organizations is extremely high, given the length of time these tools have been around:
Community and Social Networking Tools Employed and Planned (% of Respondents)
Anticipated Timing
Network or Tool
Today
Next 12 Months
Beyond 1 Year
No Plans to Employ
Facebook fan page
86%
10
3
1
Twitter
65
19
7
9
Customer reviews
55
26
13
6
Blogs
55
25
12
8
Viral videos
50
22
13
15
Facebook connect
43
31
10
16
Social listening
36
31
19
14
Q & A
29
20
25
26
Community forums
27
18
23
32
Product suggestion box
19
26
20
35
Source: e-Tailing Group, September 2009
The top three concerns of marketers and merchandisers related to social media:
Brand degradation fear - “people can trash my products in front of large audiences”?
Competence fear - “I am using outdated marketing/merchandising techniques”?
Competitive fear - “customer’s inclination to leave their site to find a more socially-engaging site”
These motivators, which drove the last wave of social media adoption, will also be driving the next wave in the coming year, says the study. Over the next 12 months, study respondents say they plan to adopt:
Facebook Connect (31%)
Social Listening Tools (31%)
Customer Reviews (26%)
Product Suggestions (26%)
The study also found the primary goal for adopting social media was:
Customer engagement (39%)
Mobilizing advocates to drive “word of mouth” (30%)
Increasing brand loyalty (21%)
Lauren Freedman, President of the e-Tailing group, says “The integration of community and social networking within e-commerce has reached critical mass… failing to engage consumers via community and social media will have brand and bottom-line implications… “
Regarding advocacy and word of mouth (the #2 goal of using social media tools), the study found that Facebook is considered by brands and merchants to be the “single most effective tactic in mobilizing brand advocates and influencers to spread the word about products/services.”
However, when it comes to driving sales and customer engagement, customer reviews came out on top by a wide margin, with 78% of those polled listing customer reviews as the #1 social media tool for generating sales and 61% listing customer reviews #1 in driving customer engagement.
Top 3 Sites or Tools Expected to Yield Greatest Sales Increase (% of Respondents)
Social Media or Tool
Total Response
% Rank 1
% Rank 2
% Rank3
Customer reviews
100
78%
14%
8%
Q & A
43
16
49
35
Facebook fan page
39
13
36
51
Viral videos
34
18
44
38
Community forums
33
6
45
49
Blogs
30
10
47
43
Social listening
22
14
27
59
Facebook connect
19
26
32
42
Product suggestion box
17
41
24
35
Twitter publishing
14
7
57
36
Source: e-Tailing Group, September 2009
Top 3 Sites or Tools Expected to Create Greatest Customer Engagement Increase (% of Respondents)
Social Media or Tool
Total Response
% Rank 1
% Rank 2
% Rank3
Customer reviews
67
61%
16%
23%
Q & A
46
20
50
30
Community forums
46
48
26
26
Blogs
43
16
58
26
Facebook fan page
42
31
43
26
Twitter publishing
29
34
14
52
Product suggestion box
27
22
30
48
Viral videos
24
12
38
50
Facebook connect
21
19
29
52
Social listening
6
33
17
50
Source: e-Tailing Group, September 2009
Some very interesting data and much of it is inline with what we are seeing with our clients and prospects as well.
Proposed changes on the horizon to Federal Trade Commission (FTC) guidelines could further impact social media marketing while radically altering some marketers practices of using third-party spokespeople for online brand marketing. Michael Lasky, a senior partner at Davis & Gilbert LLP, a New York law firm that specializes in advertising and communications law says “Agencies and clients, especially those working in the social media space, must understand that the FTC’s efforts to address deceptive practices can create liability and exposure.”
Additions and modifications now under consideration by the FTC are, “Guides Concerning the Use of Endorsements and Testimonials.” It is expected that a final ruling on the Guides will occur sometime later this summer or early fall. Behind the proposed changes is what Lasky terms, “The 10 Commandments of commercial marketing as found in Section 5 of the FTC Act — summed up as — thou shall not commit a false or deceptive practice.” The FTC is working to address this: A blogger or spokesperson’s failure to disclose a fact or event that could alter the consumer’s decision regarding a product or service.
Now, I know some agencies and marketers may have tried this approach of non-disclosure but most cases have been very unsuccessful and actually created more bad that good for the brand in question. The practice of full disclosure for social marketing is really the only way to really operate otherwise it just rooted out as not genuine and in many cases deceptive. I think part of the great value of the social graph is that it self-polices on much of this. Also, organizations like WOMMA publish guidelines and best practices for agencies and marketers in addition to have formal process for grievance filing when tactics are in question.
Brands and agencies should examine the FTC’s efforts understand their meanings and interpretations and to avoid problems down the road. A clear liability can and will arise when and if marketers pay bloggers or provide other “consideration” such as free products and services in return for a favorable post. Disclosure is necessary.
Agencies and clients, if they haven’t already, should adopt written guidelines that come into play when any “consideration” is involved. The guidelines must work explicitly to “make it clear the company wants the blogger to disclose whether any compensation or any other item of tangible value, such as free product, has been received in return for a favorable post or review,” said Allison Fitzpatrick, associate counsel at Davis & Gilbert LLP.
I would encourage agencies and marketer to go the WOMMA site to familiarize themselves with the organization and much of the guidelines and best practices they have organized around this topic.
Opening keynote of the 2009 NewComm Forum which is organized by the Society of New Communications Research is kicked off by Charles Best the founder of DonorsChoose.org. Charles was inspired while a social studies teacher in the Bronx to create a place where people could donate to charity online and have the donations directed to classrooms projects in need. They have given us all gift cards for us to donate to a classroom or project in need. He initially invested $2,000 dollars to create the version 1x. Quickly the teachers began posting projects and donors were directing micro-donations to specific projects. Word spread among teachers in the Bronx and Charles became the equivilant of “Robin Hood”. Social Media provides a great platform for charity.
Charles shared some amazing “Citizen Philanthropy” stories. One great story was a partnership with Crate and Barrel to provide customers with gift cards to donate on behalf of CB to whatever classroom project of their choosing. Customer feedback was overwhelming and the purchase/loyalty results proved amazing. Crate and Barrel customers who donated actually spent 16% more and even customers that only opened the mailing with the gift card spent 5% more. Social Media ROI via charitable giving. Some, interesting stats from Charles about donorschoose.org - 74% of donors are new to charitable giving.
Great to see the web and social technologies enabling so much good in this world.
I recently had a chance to sit down and spend sometime with Todd Friesen and hear his latest thoughts on Social Media. Naturally, the conversation turned to Twitter fairly quickly. Todd is very active on Twitter and offers us some perspective on micro-blogging and its impacts on brands, search and SEO. Thanks for stopping by and sharing your thoughts Todd. It’s always great to catch up. Looking forward to seeing you at the next SMC Seattle event.
