Social Media Does Increase Revenues $$

So, here’s the big one, does spending on social media really pay back? A fresh MBA graduate from MIT, Niki Gomez, passing through London and We Are Social on her way to Mumbai, gives her views.

At last, a study quantifies what many of us felt must be true, that social media does translate into increased sales. As Violette mentioned last week, a study by Wetpaint and Charlene Li’s Altimeter Group shows an extremely strong correlation between engaging in different social media and earning higher revenues. The study looks at the engagement of top 100 brands from the 2008 BusinessWeek/Interbrand Best Global Brands report and ranks them from 1 to 127, based on how they use social media channels. It finds that the top brands with their rankings in brackets are:

Starbucks (127)
Dell (123)
eBay (115)
Google (105)
Microsoft (103)
Thomson Reuters (101)
Nike (100)
Amazon (88)
SAP (86)
Tie - Yahoo!/Intel (85)
The most engaged brands experienced revenue growth in 2008 of 18% whilst the least engaged brands experienced losses of negative 6% over the same period.

Also interesting is that only arguably half of these are internet companies. The study categorizes the brands, a la Malcolm Gladwell, into mavens, those heavily engaging in 7 or more channels, such as Starbucks and Dell; butterflies, such as American Express and Hyundai who engage with seven channels but with less engagement; selectives who engage in six or less but do some on a deep level such as H&M and Philips; wallflowers like BP and McDonalds who engage with six or less but with a light touch. My question was whether social media pays off because of lower marketing spend, as there is a shift from spending on more traditional channels. However it seems, revenues, actual sales are up on previous years, even boom times!

Their findings conclude that it is not how many social media channels you use, but how deep that engagement is: so being social pays, but it’s the quality rather than quantity of these conversations that seems to triumph yet again. So, please think before you tweet… a good piece of advice for brands and individuals alike.

http://wearesocial.net/

Death spiral!

Posted by Seth Godin on July 22, 2009

You've probably seen it. The fish monger sees a decline in business, so they have less money to spend on upkeep and inventory, so they keep the fish a bit longer and don't clean up as often, so of course, business declines and then they have even less money... Eventually, you have an empty, smelly fish store that's out of business.

The doctor has fewer patients so he doesn't invest as much in training or staff and so some other patients choose to leave which means that there are even fewer patients...

The newspaper has fewer advertisers, so they can't invest as much in running stories, so people stop reading it, which means advertisers have less reason to advertise which leaves less money for stories...

As Tom Peters says, "You can't shrink your way to greatness," and yet that's what so many dying businesses try to do. They hunker down and wait for things to get better, but they don't. This isn't a dip, it's a cul de sac. It's over.

Right this minute, you still have some cash, some customers, some momentum... Instead of squandering it in a long, slow, death spiral, do something else. Buy a new platform. Move. Find new products for the customers that still trust you.

Change is a bear, but it's better than death.

http://sethgodin.typepad.com/

Communications Catalyst

David Mullen on PR, Integrated Communications and Social Media

Are you using social media to expand your network and connect with new people? Maybe you’d like to increase the opportunities for your company to interact with customers. If you’re looking for ways to build your presence or your company’s presence online, keep reading.

The idea for this post came from my new friend Arik Hanson, who I’ve been getting to know recently. Arik asked me what I’ve done to start building a broader network of contacts and relationships with some incredibly smart, amazingly talented marketing/PR/social media folks.

So here’s what I did to get immersed in social media tools and build what Arik at least thinks is the start of a decent online presence. These tips can be used for individuals like yourself or for brands like your employer. I’m not claiming they are groundbreaking, but this is what I’ve found helpful.

1. Be Human - For the love of all that’s good, be yourself. People don’t want to engage with robots. They want to connect with other humans. Toss some [appropriate] personal stuff in your interactions to complement all the professional talk. On one of my first blog posts, Chris Brogan wisely commented, “I’m still a person when I’m at work.” In other words, don’t check your personality at the door.

2. Add Value - There are lots of ways to provide value to your online connections. Share great industry news stories and funny videos. Point them to other smart people with whom you think they should connect. Have a point of view on issues or trends and let them know about it. If you work for Kraft, share a great recipe daily or links to nutrition news.

3. It’s Not About You. Seriously, it’s not about you or your personal brand. It’s about everyone else. Shine the spotlight on others. Celebrate their successes. Brag about them to your connections. Use social media networks to engage your customers in ways that make them feel like the most important people on the planet. When you are a champion for others, an interesting thing happens. Others become a champion for you.

4. Engage and Interact. If you write a blog, follow up with readers by commenting on their comments. Email those who comment and thank them for their time and insights. If you’re on a social media platform, reach out and strike up conversations with people. If you’re a business, start conversations with your customers. Ask them what you could do better. Thank them for their business.

5. Don’t Broadcast. Shannon Paul would say “don’t be THAT guy.” If you or your company sets up social media outposts to broadcast messages, you won’t have much success. Your corporate blog should NOT be chock full of posts about new products and company news. You shouldn’t set up automatic direct messages on Twitter that basically say, “hey! click my junk and subscribe to everything I’m doing!” That turns people off immediately.

6. Participate Consistently. I believe consistency is key. Let’s take Arik for example. While we started chatting through Twitter only about a month ago, I not only know his name, but I also can spell it despite its unique spelling. That’s because he takes time to participate consistently and engage me regularly. The result is that he was top-of-mind for me when I wanted to point my Twitter connections to a great new person to follow. The same holds true for employees who participate in social media for their brands. Participating consistently builds a stronger online reputation for your company and boosts your presence within social media circles.

7. Don’t Focus on A-Listers. You should learn from the A-Listers by reading their blogs and following them on Twitter or YouTube. But I didn’t and still don’t spend a lot of time or effort trying to engage them online. If we’re ever in the same room, you can bet I will introduce myself. But these folks have so many people vying for their attention that they can be spread a bit too thin. I focused on creating relationships with people who were up-and-comers. Your company may want to target the biggest mom blogs on the Web. That’s fine. But I’d recommend also targeting middle-of-the-pack and new bloggers who are creating great content. It’s easier to engage them and there’s a good chance their readership will grow if they’re producing good stuff.

8. Don’t Sweat the Numbers. Spend your time focused on the content you’re producing, not the number of blog visitors or Twitter followers you have today. By participating consistently and adding value, more people will find you and begin connecting with you. The numbers will come if you’re doing the other stuff well.

9. It’s a Small World. Remember that when you’re about to write a nasty comment or blog post or Tweet or Facebook status update. Your reputation on your blog will follow you to Twitter and wherever else you hang your online hat. Not to mention the fact that Google’s spiders will index that moment of rudeness and, with your luck, it will probably be on the first page of results from a Google search of your name. As my three-year-old daughter would say, “that’s nawt good!”

10. Experiment. When you do share links to your latest blog posts on Twitter, alternate the times of day you tweet it and note which times you received the most traffic. That may give you some insight into when the majority of your followers are online and shape what time you send future tweets on behalf of yourself or your company. Use the Questions & Answers section of LinkedIn to extend the conversation of your latest blog post and see if it drives any traffic to your blog. I love experimenting in these ways and I use what I learn for both myself and my clients.

What is missing? What have you done that’s really helped build your online presence or that of your clients? Please share them with the rest of us in the comments.

http://www.davidwmullen.com/2009/01/07/10-tips-to-build-a-solid-online-presence/

Let the audience talk to each other

We are social



In a world where media is global, social, ubiquitous and cheap. In a world of media where the former audience are now increasingly full participants. In that world, media is less and less often about crafting a single message to be consumed by individuals and is more and more often a way of creating an environment for convening and supporting groups. And the choice we face, and I mean anybody who has a message they want to have heard anywhere in the world, isn’t whether that’s the media environment we want to operate in - that’s the media environment we’ve got. The question we all face now is how do we make the best use of this medium, even though it means changing the way we’ve always done it.

http://www.ted.com/
http://wearesocial.net/

Malcolm is wrong

By Seth Godin

I've never written those three words before, but he's never disagreed with Chris Anderson before, so there you go.

Free is the name of Chris's new book, and it's going to be wildly misunderstood and widely argued about.

The first argument that makes no sense is, "should we want free to be the future?"

Who cares if we want it? It is.

The second argument that makes no sense is, "how will this new business model support the world as we know it today?"

Who cares if it does? It is. It's happening. The world will change around it, because the world has no choice. I'm sorry if that's inconvenient, but it's true.

As I see 'free', there are two forces at work:

In an attention economy (like this one), marketers struggle for attention and if you don't have it, you lose. Free is a relatively cheap way to get attention (both at the start and then through viral techniques).

Second, in a digital economy with lots of players and lower barriers to entry, it's quite natural that the price will be lowered until it meets the incremental cost of making one more unit. If a brand can gain share by charging less, a rational player will.

Conde Nast (publisher of the Wired (Chris's magazine) and yes, the New Yorker (Malcolm's magazine)), is going to go out of business long before you get sick, never mind die. So will newspapers printed on paper. They're going to disappear before you do. I'm not wishing for this to happen, but by refusing to build new digital assets that matter, traditional publishers are forfeiting their future.

Magazines and newspapers were perfect businesses for a moment of time, but they wouldn't have worked in 1784, and they're not going to work very soon in the future either.

We're always going to need writers, but the business model of their platform is going to change.

People will pay for content if it is so unique they can't get it anywhere else, so fast they benefit from getting it before anyone else, or so related to their tribe that paying for it brings them closer to other people. We'll always be willing to pay for souvenirs of news, as well, things to go on a shelf or badges of honor to share.

People will not pay for by-the-book rewrites of news that belongs to all of us. People will not pay for yesterday's news, driven to our house, delivered a day late, static, without connection or comments or relevance. Why should we? A good book review on Amazon is more reliable and easier to find than a paid-for professional review that used to run in your local newspaper, isn't it?

Like all dying industries, the old perfect businesses will whine, criticize, demonize and most of all, lobby for relief. It won't work. The big reason is simple:

In a world of free, everyone can play.

This is huge. When there are thousands of people writing about something, many will be willing to do it for free (like poets) and some of them might even be really good (like some poets). There is no poetry shortage.

The reason that we needed paid contributors before was that there was only economic room for a few magazines, a few TV channels, a few pottery stores, a few of everything. In world where there is room for anyone to present their work, anyone will present their work. Editors become ever more powerful and valued, while the need for attention grows so acute that free may even be considered expensive.

Of course, it's ironic that sometimes people pay money for my books (I view them as souvenirs of content you could get less conveniently and less organized for free online if you chose to). And it's ironic that I read Malcolm's review for free. And ironic that you can read Chris's arguments the most cogently by paying for them. [Update: you can chime in here and see what's being said around the web as well.]

Neatness is for historians. For a long time, all the markets for attention-based goods are going to be messy, which means that there are going to be huge opportunities for people (like you?) able to get that most precisous asset (our attention) for free. At least for a while.

http://sethgodin.typepad.com/seths_blog/2009/06/malcolm-is-wrong.html