Tags: Business, Facebook, Generation Y, Groundswell, Marketing, millennials, Net gens, Online marketing, ROI, Social Media, Tweens, Web 2.0
Generation Y – roughly those aged 13-29 – are among the strongest consumers and influencers. And while social media like Facebook, delicious, and Flickr have garnered media attention, many businesses are still wary of dipping a toe in the social media water.
I argue that we can gauge return on investment (or influence) for Gen Y by looking at their buying power and online behavior and therefore that it is imperative that (most) businesses participate in social media. Plus, I will give you the research to back up these assertions so you can prove it to your boss.
Growing up in pre-internet Ohio, I spent a good chunk of my allowance and lawn-mowing money on comic books at the local pharmacy. If they were sold out of my usual books, I was SOL until the following month. Scarcity of goods required that I go where they were (and quickly!) or I would miss out.
Now, post-internet, these stories sound quaint. Given a bank account, any kid can get any comic book from anywhere in the world. So what does this have to do with social media and Generation Y?: proximity to resources.
Today, consumers expect businesses to come to them. Long gone are the lazy summer bike rides to the pharmacy – today, young people expect to be able to spend their money just about anywhere. And where are they? Online, in general, and on social media, specifically.
Maybe this shift isn’t a surprise to you, but let me prove it with research (easily printable for timid bosses or humbugs).
Tags: Facebook, Forrester, Marketing, MySpace, Online marketing, Research, ROI, Social Media, social technographics, Usability, Web 2.0
Last week, a lot of you read my guest post about the ROI (return on investment) of social media. There is no doubt that social media is changing the ways people interact online and hence, the way companies communicate with their customers.
The thing that is still missing is quantifiable data about these interactions. We’re in a theory stage – we know what’s right because we have experienced it – but we are still waiting for proof in numbers. Forrester Research made a giant step in the right direction when they introduced social technographics.
Social technographics is an analysis of consumers’ approach to social media – not just which ones they use, but understanding how they use the medium in their daily life. You can download the full report on Forrester Research’s website (there is a fee) or read the book on the same topic published April 21, 2008: Groundswell: Winning in a World Transformed by Social Technologies by Charlene Li and Josh Bernoff. (There is also a ton of free goodies at the Groundswell blog.)
I sat in on a webinar last week where Charlene and Josh expounded on their work. Josh summed up the goal of this work: “Think about what you want to accomplish, not the technology.” There is so much fascination about what technology can do that marketers often forget the question is what technology can do for you. The webinar came back again and again with the message to use this data to inform a strategy for your clients. (You can find the resulting Q&A published post-webinar here.)
How’s It Work?
Charlene and Josh categorize web users into six sections based on the level of their activity, from Creators to Inactives. I have not seen a clear but simple ranking system like this before and I certainly hope it is accepted as an industry standard. The real value, however, comes from their detailed analysis of each category’s activity.
Tags: analytics, bounce, bounce rate, Communication, Marketing, metrics, Online marketing, ROI, Search, SEM, SEO, Usability, Web Analytics
Someone lied to you if they told you statistics were boring. Website metrics show just how your audience is using your site and you ignore this data at your own peril.
A bounce rate is when someone comes to your site and immediately leaves. They bounce off of your website for whatever reason. A bounce is undesirable – you want people to come and stay on your website! Bounce is the opposite of sticky.
Time vs. Pages
I had always understood bounce determined by time – that this figure was measured from people leaving a site in a certain increment (usually 2, 5, or 10 seconds). So I was surprised when I read in Website Magazine that they asserted that bounce rate “is calculated by dividing the number of total page visits by those visits that did not result in an additional page view.”
Tags: CCO, Chief Conversation Officer, Communication, conversation, Joseph Jaffe, Joseph Turow, Marketing, Niche Envy, Online marketing, ROI, Web 2.0
Updated: Welcome Jaffe Juice readers! Note that my other posts regarding Join The Conversation are linked at the end of the first paragraph below. Also, if you like what you see, be sure to subscribe. Thanks!
I just finished reading Joseph Jaffe’s Join The Conversation and highly recommend it. I’m a believer that the internet age largely only changed our medium of communication. We still function basically the same and this is a book that supports the need for conversation (more important that communication or dialogue) through the online channel. This sounds easy but Jaffe has many, many examples of companies that failed miserably in this regard. (You may remember Jaffe from when I mentioned his work here, here, and here.)
Conversation in business is like a fairy or Santa Claus – you want to believe in it, but when the rubber hits the road, you “know” there’s nothing in it. This couldn’t be further from the truth (Jaffe has examples to back up this notion too). But who would fill this function in the office? Conversation isn’t on the org chart.
Jaffe suggests a Chief Conversation Officer (CCO). (Sidenote: Joseph, I tried to join the conversation at http://www.jointheconversation.us/chief as instructed on page 102, but that page did not exist – for shame!) Here’s the gist of a CCO:
“Said CCO would report to the very top and thus bypass any blinkered or biased silos. The conversation department would be populated by true generalists with expertise across marketing, advertising, internal communications, corporate communications, customer service, government, analysis, and press relations. They would be responsible for monitoring and listening to conversations, understanding and contextualizing them, responding to and catalyzing existing conversations, and, ultimately, joining them. (Jaffe 101-102)”
Later in the book, Jaffe reiterates that this is someone with a mix of attributes, somewhere between PR people (more “social media”) and advertising/marketing folks (more “storytelling”). I imagine this multi-dimensional CCO would also be “somewhere in between…longing for the days of good old-fashioned storytelling, with a sprinkle of authenticity and a drizzle of ROI to boot. (Jaffe 180)”
Likewise, I would think this conversation department headed by the CCO would be something like the “black ops” team mentioned late in the book. They would be responsible for experimentation, a vital aspect of any business, and fit in to the CCO model in my opinion.
“Experimentation is best conducted by a separate team – a nimble, independent, empowered, and intense group of individuals who report straight to the top. Depending on your anticipated level of risk and your comfort level, this team could be assembled as a ‘Delta Force’ or ‘black ops’ group…unaccountable throughout but ready and prepared to pay the ultimate price upon failure. (Jaffe 252)”
Jaffe’s sentiments relate to Joseph Turow, who recently wrote a terrible screed bashing all marketers in Niche Envy: Marketing Discrimination in the Digital Age (and yes, it is intentional that I am not hyperlinking the title – don’t buy this book!).
Turow says “The adperson who is master of this particular form of ‘conversation’ [two-way contact with customers and potential customers] can expect a growing role in tomorrow’s marketing world. (Turow 69-70)” He only begrudgingly acknowledges the usefullness of a marketer in touch with his/her audience and throws sarcastic quotation marks around “conversation,” but the sentiment is the same. He later goes on to quote James Stengel, P&G’s marketing chief:
” ‘All marketing should be permission marketing,’ he said, and ‘all marketing should be so appealing that customers want us in their lives…and homes.’ To do that, he cautioned, required creative content and ‘connection points’ in a variety of media and environments. (Turow 87-8)” While Turow spends most of his book bashing all marketing and inciting paranoia about the information marketers have (Old Navy knows I like blue shirts, the horror!), he is correct that direct connection between the customer and company will only become more important in the near future. What better person to be responsible for this connection than the Chief Conversation Officer?
Tags: Decision making, Marketing, Online marketing, return on investment, ROI, Social Media, UGC, user generated content, Web 2.0
We recently had one of the worst weeks ever. It included (but certainly wasn’t limited to) taking the car in to replace an insanely expensive hose, losing our heat during a Chicago winter, getting sideswiped by a Chicago trolley right after leaving the dealership, and the subsequent arguing with and lying from the trolley driver to the cop about how she was not involved. Needless to say, there were not a lot of bright spots in the week.
But when the dealership tried to squeeze another $470 from us for a CV boot, I did a little research. Yelp.com and a few other sites extolled the virtue of the mechanic right down the street. He did the job in a couple of hours for $188. Amazing.
What does this all have to do with online marketing? Well, I was not surprised when I read this study from comScore. Not only are 1 in 4 internet users consulting reviews before purchasing offline, but they are willing to pay more if the service is ranked as excellent. It seem that after the year of exuberance that was all about Facebook and twitter, business is finally getting around to answering the question of how social media effects ROI.
If you have been questioning this yourself, you are not alone. I have seen at least 5 webinars in the past week and a half on this question alone: How do we determine our ROI on social media? And there are two distinct undercurrents in this discussion: 1) a low-lying anxiety on the part of marketers regarding keeping up with current trends and 2) trouble convincing an old-school CEO or other higher-up that this is of value to the company. I am a victim of the former and may blog about it in the future, but relief for the latter is beginning to emerge.
Among the best of the webinars and white papers discussing social media ROI are those from TNS Media Intelligence/Cymfony. Anyone who is trying to convince their fellow employees about the value of social media must read their white paper, Making the Case for a Social Media Strategy. (Just so you know, I’m not connected to the company at all – I just really do like their work.)
They begin by going through an evolution of digital communications and present research on what people are doing online. They then explain how social media is a blurring of communication and content (the two activities people do the most online) and give salient examples of how struggling industries (especially newspapers) are embracing social media and seeing profits skyrocket. Among the quantifiable ROIs:
- direct conversion of buzz into sales
- market feedback/testing
And each of those quantifiable ROIs has at least one example from a major, dynamic company. Consider these:
- Crowdsourcing: “Intuit created a community with discussion boards on their site so customers can help each other with questions…According to Business Week, this community now has over 100,000 members discussing topics across 50 subject areas.” CEO Steve Bennett’s 2005 annual report letter to shareholders stated, “positive word of mouth creates a durable advantage for Intuit that translates into sustained revenue and profit growth.”
- Recommendations: “Analysis of [Petco’s] web traffic revealed that users that [sic] sort the list of products by customer ratings spend 41% more than users who search with other methods like popularity or price… Emails that feature customer review content receive 50% higher clickthrough rates.”
Helpfully, there are also cases where social media hurt companies, but a fair review notes that it was not the tool that caused the problem, but the poor PR skills of the company. Many are not adept at responding quickly, especially to a crisis situation. These examples serve as a good warning to be prepared for what you are about to take on.
In the end, social media is just a tool. But this study and others can give you the quick-and-dirty version (with stats) to help convince your more traditional bosses. It’s a scary new world but at least we’re all in it together.
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