capitalizing on the incredibly shrinking marcom expense line
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Capitalizing on the Incredibly Shrinking Marcom Expense Line
Denis Hancock
July 26-28, 2010
Park Hyatt Aviara Resort
Carlsbad, CA
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Where most social media marketing strategies are focused
Influencers
Where most of the money is
Co-creators
Customers
Social media marketing strategies are often narrowly focused
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Some guidelines for reaching everyone else more effectively
Spend less.
Talk less.
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Social media marketing critics and advocates both love these stats
Source: Ogilvy
Source: MediaPost.com
Online spend lags activity
The social component is small, and growing slowly
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The problem is the metric, not the activity
SocialMedia Cost of sending a tweet: $0
Cost of creating a Facebook event: $0
Cost of putting a video on YouTube: $0
Ability to reach customers for free*: Priceless
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Marketing is going through a structural change
Current marketing budget New marketing budget
Traditional channels
Digital
Traditional channels
Digital
Savings!
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A select few agencies have been thinking this way
“I want to be the agency that ruined it for every other agency in the world”
– Alex Bogusky, formerly of Crispin Porter + Bogusky
“Their view was always, if the idea is great enough, in a world that is intensely connected… the idea will run wild through the population without us having to pay for media.”
– Andy Macaulay, chairman of Zig
Source: Susan Krashinsky, “Advertising whiz Bogusky takes his leave”, Globe & Mail, 7/2/10
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Sites like Facebook lower the need for “creative genius”
“It does raise huge questions about, you know, could you in the future have half the marketing budget and do it differently.”
—Richard Musson, VP of Marketing for Labatt
Breweries
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New platforms are creating new opportunities
“The real opportunity isn’t for mayors – that’s limited and short sighted. Knowing that the top 5% of customers generate the majority of revenue, it’s a whole new loyalty platform. And it’s a lot cheaper than Aeroplan.”
– Phil Barrett, VP of digital and mobile at BStreet
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The key driver: “ambient intimacy”
150 used to be a lot of connections. Now it’s not.
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But there are other key differences to consider as well
Traditional Media Social Media
Cost Expensive Free (or very cheap)
Choice for customer Forced Opt-in
Connection with customer Indirect Direct
Impact on intended customer experience
Generally negative Generally positive
Ability to “go viral” Difficult Easier
Knowledge about who’s receiving—and sharing—the message
Poor Good (and improving)
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Starbucks tapped into this opportunity early
200,000 + accepted event invite on Facebook
400,000 + viewed YouTube video
379 blog posts tied back to it
Viral buzz increased 26% overall
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The potential payoffs for Starbucks are getting bigger and bigger
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@garyvee drives Wine Library’s ROI in Twitter
Direct mail campaign: $7,500 200 new customers
Billboard ad: $7,500 300 new customers
Tweet offering free shipping 1,800 new customers
Source: Tanya Battalas, “Companies take on Twitter”, New Jersey Times, June 2009
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Yelp: Great news for great service providers
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How to think about reaching everyone else more effectively
Spend less.
Talk less.
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New perceptions around media are evolving
Broadcasting = bad
Conversations = good
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The “problem” is often represented something like this
Source: “Changing context,” Nokia
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But there’s a problem with the notion of the “problem”
vs.
Social media enthusiast Your customer
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Too many people are feeling a lot like this
INITIATING
CONSIDERING
NEEDS
IDENTIFYING
ALTERNATIVES
EVALUATING
ALTERNATIVES
SALES
CONTACT INITIAL
ASSESSMENT
ADDITIONAL
INFORMATION
ORDER
ACTIVITIES
DECISION
PROCESS
FULFILLMENT
INITIAL USE
EXPERIENCES
LEARNING &
FAMILIARIZATION
PROBLEM
RESOLUTION EVALUATION
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Brand 1
Brand 2
Brand 3 Brand 4
Brand 5
Brand n
Hey consumer – talk to us! We’re
listening!
Asking them to “join in your conversation” can make it that much worse
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But there is something else you can do
In the social media world, simple broadcasting
strategies are prevalent – and effective.
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Twitter points us in this direction
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A unique growth strategy, led by weak tie connections
Weak Ties
Strong Ties
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Twitter is “few to many” rather than “many to many”
Harvard Study: 10% of Twitter users generate 90% of the content. “This implies that Twitter's resembles more of a one-way, one-to-many publishing service than a two-way, peer-to-peer communication network.”
Source: Twitter hype punctured by study”, BBC News, June 9th 2009. www.bbc.co.uk.
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Twitter users are more likely to engage in commerce
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This made Twitter much more different from Facebook than many realize
Facebook is a social network. Twitter is a media/marketing vehicle disguised as a social network. Big difference. And if you don't think it's changing the way information is dispersed, for good and bad, you're insane.
– Bill Simmons
ESPN’s “The Sports Guy”
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@woot: Buy our stuff
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@zappos: If you have a question, talk to someone else
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@mashable: broadcasting the social media guide
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Facebook is subtly allowing ambient networks to grow
Top versus Recent news
Fan versus Like
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Companies are often getting advice like this
Don’t split the conversation stream between the organization and “just fans.” You want fans to see each other communicating online. It’s about fostering a community. To split your updates from fans signals that:
You are controlling the message
Organizational message delivery is the primary reason for the page; and
The organization doesn’t value fan content or participation as highly as its own
Source: “Facebook fan page best practices”, Livingston Buzz, November 2nd 2009
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Follow it and you often get results like this
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Aren’t these a little better?
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What Facebook fans say they want
Source: Morpace Inc. study, as published on RetailCustomerExperience.com (April 13th 2010)
Note: consumers were allowed to answer “yes” to more than one response.
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The difference between “fan” and “like” is important
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Suspect
Prospect
Customer
Regular
Advocate
It connects to a new opportunity, enabled by social media
You know about the importance of these folks…
… but can you use social media to create “passive” or “occasional” advocates”?
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Using “passive advocates” to win the tug of war
She loves you
She hates you
Brand
They like you
She dislikes
you
Good Bad
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Shifting objectives: From conversations to impact
Instead of always trying to engage customers in conversations, use new tools and platforms to:
Give people something they want
Give people something they want to share
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Stickybits.com: A new case of conversations being sub-optimal
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Groupon: Cool, cheap, local experiences (if enough people buy in)
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Foursquare: Connection without conversation (and cheap, cheap rewards)
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One more thing…
Think Quirky.
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Quirky: Cost effective innovation and marketing processes collide
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Key takeaways
Spend less.
Talk less.
Think Quirky.
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Denis Hancock Director of Marketing Insight
[email protected] www.denisbhancock.com
Twitter ID: @denisbhancock 416-863-8848