Social media? You really need a reason to get stuck in?

Recently, I have been involved in a number of debates about the usefulness of social media in business. I was slightly taken aback that the business value of social media even needed debating. However, many people are simply immersed in their everyday business and personal challenges and have not had the time to consider or explore these issues.

This short article is to get you started in the ‘why’ social media is so important to future business success. I am not going to pound you with statistics: they now overwhelmingly point to majorities of people being online and involved in social media, even if we need to remember the digital disenfranchised and many businesses that operate perfectly well without any online presence.

Social tools, networks and media have enabled customers to do what they’ve always wanted to do — be heard and to have the power to turn their ideas into ways to make the products and services they love even better. These tools are also allowing them to reach more people like them, with common interests and information needs, creating powerful communities not possible only a few short years ago.

So, if you are in business, and can afford to ignore your customers, and potential customers, clustering online and willing to help you deliver them what they want, then you are missing a huge opportunity.

That’s why the best advice about social media, customer service, or anything other business initiative has always been to master the basics before proceeding to the more advanced topics.
Social media will still be here next year (and even the year after). Take the time to first address any serious issues or problems within your customer service organisation before pushing ahead into social media. And if you really can’t wait and feel compelled to jump right into social media while revamping your customer service organisation in parallel, at least start small and stay focused.
Choose a particular channel — whether it be Twitter, a discussion forum, or an online user group — and put enough resources and effort behind it to make it work. Put in the time. Engage with customers. Show people that you are serious and that you plan to stick around for the long term. If you respect your customers — and the community — they will likely both respect you back.
And that’s a pretty good start. If resources, in terms of people, are either scarce and you can’t find an in-house social media champion, think of hiring an agency. In a future post, I’ll give you some tips about choosing one. Or find a guru like me who has not only been immersed in this stuff for a while and already made all those classic mistakes and learned from them!

What a company develops from venturing into social media marketing is social capital. There are sound economic reasons for the importance of social capital. Oliver Williamson won the Nobel Prize for Economics in 2009 for his work on transaction costs. One element of his research found that trust reduces transaction costs — in other words, if you’re doing business with someone you know, the cost of doing it decreases.

The Cluetrain Manifesto

The manifesto that started us thinking about being connected

Remember The Cluetrain Manifesto? It was a set of 95 theses organised and put forward as a manifesto, or call to action, for all businesses operating within what was suggested as a newly-connected marketplace, as far back as 1999. The ideas put forward within the Manifesto aimed to examine the impact of the Internet on both markets (consumers) and organisations.

In addition, as both consumers and organisations are able to utilise the Internet to establish a previously unavailable level of communication both within and between these two groups, the Manifesto suggested that the changes that will be required from organisations as they respond to the new marketplace environment.

Here is a summary, in their words: “These markets are conversations. Their members communicate in language that is natural, open, honest, direct, funny and often shocking. Whether explaining or complaining, joking or serious, the human voice is unmistakably genuine. It can’t be faked.

“Most corporations, on the other hand, only know how to talk in the soothing, humourless monotone of the mission statement, marketing brochure and your-call-is-important-to-us busy signal. Same old tone, same old lies. No wonder networked markets have no respect for companies unable or unwilling to speak as they do.

“But learning to speak in a human voice is not some trick, nor will corporations convince us they are human with lip service about ‘listening to customers’. They will only sound human when they empower real human beings to speak on their behalf.”

So social media marketing barely needs an ROI, as the current demand is phrased. You just need to decide whether you want to be in business in five years or not. Ignore the sea slowly being sucked away from you and the social media tsunami will catch you unprepared.

List of social media marketing metrics

Social media marketing strategy arguably has two concerns: one is about producing the nitty-gritty metrics that are used to justify investment in terms of time and resources and to steer future involvement and activity.

The other concern is about lifting your ahead high enough above day-to-day activity to get a clear enough view of social media marketing from a wider organisational viewpoint.

An organisational approach to social media marketing measurement looks at the macro-figures that really matter: sales, profit margin, customer satisfaction and loyalty. Concentrating solely on the social media detail is not the full story.

On the other hand, just standing back and looking at the bigger picture is not going to be enough for your colleagues and boss: they are going to want to see hard evidence that social media marketing is going to bring tangible business benefits.

When we talk about social media, we’re really talking about attracting and developing interaction. The goal of any social media marketing strategy is to provide the right tools and content so that communities can interact with your brand and act as your brand ambassadors.

Here’s a ‘long list’ of indices that can give you measurements of interaction and participation:

  • Your brand mentioned
  • People storing and sharing content
  • More frequent website and blog visits
  • More blog comments
  • Referring your brand’s content to their friends
  • People in communities using interactive content more frequently
  • Incremental enquiries, or quotations, or sales
  • Improved cost of sales

Customers and prospects interacting with your brand content are far more likely to score high on other measures. So how can you boost community interaction? The tools and onsite functionality you need are going to depend on your business, your strategy and your goals. What you’re ultimately looking for is a wide range of tools to help people interact.

This list of metrics should help you work out what can be measured and also what kind of tools/functionality you may want to introduce. In doing so, you’ll able to determine the relative success and adoption of new features. You may also unearth trends and spot opportunities or issues. In any event, monitoring how the sum of community interaction changes over time can really help you position your organisation as a community-centric organisation.

You can apply different weightings to different interactions (for example, a ‘love this’ rating is worth less than a ‘follow item’). Social media managers can then identify the buzz and act accordingly (better promotion, interviews, videos).

Tracking and making sense of interaction is a fundamental part of social media marketing. You can score different interactions and devise an algorithm to create some kind of overall interaction index. It might help you condense interaction measurement noise into a single metric.

Before we jump into the list there are a few caveats:

  • Not all of these will be relevant to all sites (for instance, ‘posts’ won’t be any good for sites without blogs and a comment facility)
  • ‘Print page’ as an interaction measure is barely worth looking at…or is it? In any case, some of these things are more important than others
  • There is some crossover: for example ‘bookmarks’ and ‘wishlists’ may be the same thing on your site
  • Some metrics will have sub-metrics
  • Avoid confusion: if a widget just doesn’t do what it should do then it doesn’t matter whether 10,000 people installed it last week: they’ll still hate it
  • Human power is needed to really understand the detail behind the numbers and to act on that knowledge: interpretation is key to turning metrics into indices that you can act on
  • It’s about quality not quantity: this list is not exhaustive
Here’s the list of possible social interaction indices:
  1. Alerts (register and response rates by channel, CTR, post-click activity)
  2. Bookmarks (onsite, offsite)
  5. Email subscriptions
  6. Fans or friends (become a fan of something/someone)
  7. Favourites (add an item to favourites)
  8. Feedback (via the site)
  9. Followers (follow something/someone)
  10. Forward-to-a-friend; share
  11. Groups (create/join/total number in group/group activity)
  12. Install widget or app (on a blog page, Facebook, iPhone)
  13. Invite/refer (a friend)
  14. Key page activity (post-activity)
  15. Love/like this (a simpler form of rating something)
  16. Messaging (onsite)
  17. Personalisation (pages, display, theme)
  18. Posts
  19. Profile development (update avatar, bio, links, email, customisation)
  20. Print page
  21. Ratings
  22. Registered users (new/total/active/dormant/churn)
  23. Report spam/abuse
  24. Reviews
  25. Settings
  26. Social media sharing/participation (activity on key social media sites)
  27. Tagging (user-generated metadata)
  28. Testimonials
  29. Time spent on key pages
  30. Time spent on site (by source/by entry page)
  31. Total contributors (and % active contributors)
  32. Uploads (add an item – articles, links, images, videos)
  33. Views (videos, ads, rich images)
  34. Widgets and apps (number of new widgets users/embedded widgets/apps)
  35. Wishlists (save an item to wishlist)