FreshNetworks Blog

Olivier Creiche from Six Apart thinks there are four specific opportunities for buzz and social media; four ways that firms can make the most out of giving power to people through blogs, forums and communities.

• e-commerce. Olivier feels that people don’t talk about this enough, and about how you can use social networks as an e-commerce mechanism. The best known example of this is Amazon who, reportedly, make about 25% of their sales from such distributed e-commerce. Their model is simple – applications on peoples’ networks allow them to say what books they like, they’ve read and they want to read. Amazon provides the thumbnail pictures of the books and when you click on one it takes you to the Amazon site to buy online. If you’ve not seen this application then my bookshelf is below:

• Join the conversation using the same means. If you want to engage people online you need to use the same means that they do. This could mean blogging. It’s important to note that companies don’t blog, individuals do. So if you have a corporate blog it’s important that it’s clear who is writing it and that their individual voice shines through.
• Advertising. In an environment where we know who people are and can gather lots of information about them, advertising can be more targeted, and charged to a brand at a premium.
• Community interaction. There is a huge benefit to watching a community grow, to working with it and letting it do some of your leg work for you.

In order to make the most of these four areas, Olivier suggests a set of guidelines for a brand or marketing agency to adopt:

• Influence the influencers
• Be ready to lose some content
• Be authentic
• It’s not about you; it’s about them
• Provide value to users
• Maintain the dialogue

The last of these is critical – if you start engaging with people online you need a plan for what you will do with them in the future. You can’t (and shouldn’t) just abandon them.

A short session from Fred Cavazza. For him, social means share. Online everybody has something to say, you cannot hide from it. The only question really is if you want to be inside or outside; to join the conversation or to let others talk about it without you.

In this environment, information is a commodity, everything is free and as a brand or a marketeer, if you don’t engage then people won’t respond.

Experimentation is key – Dell did this with their Ideastorm, and it paid off. Others do it and even if it doesn’t work, they’ve joined the conversation and are able to adjust and ammend their social media strategy. They firms that will fail are those who don’t engage at all.

A few tips from Xavier des Horts at Nokia about how to grow a blogging culture, and particularly how to make sure that any external social media marketing or communications that a business does is as successful as possible.

Nokia have just launched their new public facing social media site (Nokia Conversations). For Xavier, social media like this is communications as opposed to advertising. He thinks that the success of an external use of blogs, for example, relies on successful internal use of such tools. You need to build a blogging culture in the business, a four-part process:

1. Encourage and enable people internally to blog themselves – this can be internal and is also a great way of dealing with knowledge sharing problems.
2. Build external social media relationships – Xavier admitted to searching every couple of hours on Google Blog Search for Nokia to see what was being discussed. He responds to these personally where relevant as part of the process of building strong relationships with others externally.
3. Build networks of contacts – just as traditional PR would brief press, you should find who the influential bloggers, writers and commentators are in your area and feed them news and developments.
4. Do all of this honestly – as a business, to be successful with social media you need to be open honest and respectful. Otherwise people will find you out and that will have the counter-effect of what you set out to do (remember Wal-Marting Across America)

Finally – where does blogging and social media sit in a firm’s communication’s strategy? For Xavier there are three main parts to a firm’s external voice. The formal statements (such as on a press site), the marketing message (on the main corporate website) and the stories. It is the latter which blogging can do so well, and that many firms are yet to realise the benefits of.

There are many benefits to social media, but Jay Stevens from MySpace showed that in a US study 45% of users of social networks said that they “made life more exciting”. This comment shows one thing – that through social networks you can build deeper emotional connections with people. Deeper because social networks are not a substitute for real life, but they enhance it.

For Stevens, the real use of social networks is yet to come. He notes three trends that are major developments in this space:

1. Personalisation – from the BBC homepage to MySpace we’ve seen that ajax and widgets are making it easier for people to make their online experience personal. The critical next step for social networks is to find ways for one user to use the same network for multiple reasons – personal, work, dating. Essential for the success of this will be homepage personalisation – a good social network is one that each individual feels as though they own.
2. Portability – for Stevens this means both the ability to access content from multiple devices, but also to add content any time any place. The ‘post’ functionality of MySpace and ‘share’ for Facebook are starting to make this possible.
3. Collaboration – the future is going to be open APIs and developer applications. Something that Facebook is leading the way in at the moment.

Mark Beth Kemp from Forrester thinks that the lifetime value of a customer is no longer enough. Both this and the ROI model are deficient because they don’t take account of customer dynamics.

One interesting example she gave was about the launch of the Wii. They wanted to launch a games console that appealed to an expanded market and to sell the benefits of gaming. One critical barrier they saw was the difficulty of persuading parents of children (specifically mums) that this was a new games console that kids should enjoy using. They turned this barrier into an opportunity and launched the alpha mums programme. Finding the most active mums online and seeding them with the product. These mums were encouraged to host parties where other mums could try the Wii. The result was incredible and shows the power of harnessing customer dynamics. One alpha mum alone sold 200 consoles to her email contacts.

For Mary Beth, your new high value customers are not those who spend the most with you over their lifetime. It’s more complex. The highest value comes from your Ambassadors – those who spend a relatively large amount personally and also have a lot of social value – they have a lot of contacts and have influence over these people. Finding exactly who these people are can be complex although really it just relies on finding out where they socialise (online or offline) and how many people they are in contact with there. This gives you their reach. You can then calculate how valuable their recommendations are likely to be and that gives you a crude measure of social value. Perhaps a developing but more useful measure for marketeers.