Social Media and Online Communities in Slow Growing Economies

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I had dinner this week with a senior marketing executive for a consumer goods company and of course the economy was a big part of our conversation. How can’t you but talk about what’s happening in the financial world these days. He was telling me how over the summer months their executive team had already made the decision to “protect and grow” the business for the balance of 2008 and expected the same strategic approach to continue throughout 2009. Their strategy was to focus more of their marketing spent on the two core groups of customers who can most directly influence revenue:

— High-value customers you want to retain.

— High-potential customers you want to grow.

For high-value, loyal customers that they wanted to retain, they would need to do a better job at tilting the hard-soft benefit equation toward the soft side with special benefits and access unavailable to the general population. For the high-potential customers that they wanted to grow, they planned to increase service/product quality and personal customer experiences instead. They also planned to shift marketing spend to initiatives that identify best customers, collect actionable intelligence on them and then leverage that data to influence profitable customer choices.

What was interesting was when we talked about “product price”. The option of slashing prices was not even an option for them due to their increases in energy costs and their higher component costs. They are absolutely focused on increasing service/product quality and personal customer experiences instead.

Thus, the reason for our dinner… he was interested in learning more about how an online community could be quickly added to his marketing mix, without turning the effort into a project. I recently read in Advertising Age, that an Epsilon CMO Survey revealed that nearly two-thirds of chief marketing officers said their interactive/digital marketing budgets have increased in the past year, while 60% have seen their traditional advertising budgets go south. Here was a first-hand statistical proof point to that survey.

The conversation was about how a social media online community could be leveraged to “target” high-value and high-potential customers. I’ll leave the details of that conversation for another day, but it was clear to each of us that during a slow growth economy, the traditional marketing mix could not continue without change. Creative marketers were looking for pragmatic ways to engage and influence, without having to spend large chucks of a reduced marketing budget.

So, what changes are you making to your marketing mix?

There is no such thing as social media. There is only real life.

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I attended the PRSA T3 event in New York this week on Sept 11th… a day of sad memories. I’m surprised that the event was scheduled on such an important day for New York and for those of us who have been so personally affected from the terrorist attack on New York and our country. And this decision from a group of public relations professionals…

OK, I did really enjoy the event. The folks who organized the event should take a bow. It was first class in every way. It was stacked with excellent content and superb speakers. The day started off with Paul Gillin, the author of “The New Influencers” and was quickly followed up with Peter Shankman of Help a Reporter Out (HARO). Talk about world-class and a wonderful user presentation from George Wright of Blendtec (www.willitblend.com) on how to use viral marketing to spread the word with no budget using out of the box thinking.

I thought Peter did an excellent job at putting social media in its correct context. He said that “there is no such thing as social media. There is life”. Social media is but an extension of life. If you would not do something in real life, then why would you do it online? For example, I doubt you would “poke” your partners or customers. So, why do it online?

This perspective brings to the surface one of the biggest objections I often hear about. It directly raises the issue of the seriousness of social media a tool for marketers. The first mainstream phase of social media solutions that have received the greatest market awareness (MySpace and Facebook) have shown the possibilities of “fun”, but never have connected to businesses and marketers, except for the most horizontal business products such as Coke and Pepsi. It all validates Peter Shankman’s perspective that there really is no such thing as social media. There is only life.

There is life though for marketers, who are able to learn from MySpace and Facebook and make it better resemble life. I think of these products as a second generation match.com. That by the way is the origin of Facebook… looking to meet girls at Harvard. It certainly was not a world where a vertically oriented marketer could find comfort. It still isn’t.

By the way, if you a marketer with PR responsibilities make sure you look at Help a Reporter Out (www.haro.com). It is a great resource for locating authors looking for sources to complete their stories. And it’s all free.

Going from 1.0 to 2.0

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You aren’t alone if you’re trying to figure out where to begin when it comes to doing more — or doing at least something — in social media in your organization. At a recent Social Media Club meet up in Boston, the group surfaced some great tips for getting started. Here are some of the groups ideas for taking the plunge or expanding what you’ve started:

  1. Embrace experimentation as a way of life.
    By it’s very nature, social media is participation-driven and enabled by technology — which means it’s always changing and the variables are pretty much infinite. “Your executives have to understand the need to take action. They have to be willing to try things and see what sticks.”
  2. Start small. Think evolution, not revolution.
    You might even be “doing social media” already. Next time you’ve got big news, something as simple as creating a companion podcast/video interview makes your news more engaging and shareable. As a number of PR folks in the room advised, just post it to YouTube, on your website and share the links via email to customers, prospects and bloggers who follow your industry. You’ll see that it doesn’t hurt and nobody dies. So make it a series. See what kind of downloading action you get, and ask for feedback wherever you post it.
  3. Monitor what’s going on (and make new insights easy to appreciate)
  4. Start inside. Lots of companies launch blogs internally first, often within the corporate intranet. It’s a safe place to surface those with the natural talent and inclination to sustain blog posting. It’s also a great way to get employees used to a new style of communicating.
  5. Have trust in your people (or get some people you can trust)
    The new realities of social media — always on, everyone has a voice, sharing is paramount — bring with it much less control, more immediacy and unpredictability. Which means you and your boss and your team mates have to trust each other to use their best judgment; micro-managing is not an option. If you don’t have that kind of trust, consider making a change. In your team or your choice of employer.
  6. Involve the legal team at the beginning (especially if you’re a public company) It sounds counter-intuitive but the best thing you can do is proactively engage your legal folks. Much better than having them send up red flags when you’re about to launch something. Offer a social media 101 session, show the impact of social media on the business, how other companies are navigating these new waters, and encourage their collaboration on ways to overcome any concerns they may have.
  7. Evangelize, and train everyone
    If you’re the social media champion, unleash your beliefs and savvy on as many groups across the company as you can. Go to corporate communications and help them see how to shift from message control to two way conversations, create a social media 101 workshop or e-learning event and resources, and work with HR or whomever to get it shared throughout the company.

The take away? Get started. Learn small. Built internal expertise.

Scott

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