Turning Social Media into Assets
…It's also a nation that loves to talk about those brands. Indeed, one recent reckoning from The Keller Fay Group indicates that more than two billion conversations focus on products and services every day in the United States. No wonder, then, that eMarketer says that nearly 90% of all Americans get their product information from trusted sources like families and friends, or that McKinsey believes that word of mouth is the primary factor behind 20% to 50% of all the purchase decisions we make.
Technology, in the form of the current social media revolution, is clearly accelerating this trend.
The growth of social networking, online video, micro-blogging, blogs, podcasts, and a wide variety of other user-generated content -- as evidenced by the successes of YouTube, Facebook, Tumblr, Twitter, and others -- allows, encourages and inspires an almost infinite number of one-to-many word-of-mouth conversations. As a result, explains a study from Starcom MediaVest Group and ShareThis Network, sharing now generates more than 10% of all Internet traffic, almost half the volume of online search activity.
The powerful impact that these non-stop digital discussions are having on both people and products helps explain why brand after brand is now turning to social marketing. But even though word of mouth moves markets, many marketers are still having a hard time achieving the four key goals necessary for success with this new brand-building approach:
• Identifying and evaluating category influencers and brand supporters.
• Forming authentic, lasting relationships with these individuals, and developing them into brand advocates.
• Collaborating with these advocates to generate brand mentions and recommendations in social media.
• Measuring the results of these collaborations, and scaling them up to maximize the brand's social reach.
In a nutshell, the real challenge for marketers is building and managing brand communities, and turning social relationships into valuable company assets. This can be especially problematic, because, according to Forrester Research, nearly 66% of interactive marketers aren't measuring their social marketing efforts, and, according to a Bazaarvoice Software survey, only 40% tie their social marketing efforts back to revenue.
That's why I believe that marketers will benefit immeasurably from technology infrastructure, or a CRM-like platform, that helps increase efficiencies as social media relationships between brands and influencers are formed and nurtured.
The need is clear here.
In every type of marketing -- except word-of-mouth marketing -- there are systems for marketers to manage the workflow and measure the results. This absence of a workflow and measurement system currently results in serious inefficiencies for brand marketers. And the pain of these inefficiencies is most acute when brand marketers try to coordinate the efforts of independent influencers and fans for the purpose of brand advocacy. It's a cliché, but it is like herding cats.
Practically speaking, the lack of a workflow and measurement system means that many brand marketers have been unable to justify scaling up their spending on word-of-mouth marketing, even though they recognize what a powerful opportunity it represents. From my perspective, the most helpful workflow and measurement system must work across all social networks, because marketers want to reach people wherever they are. Without this type of broad-based solution, however, word-of-mouth marketing simply won't be able to take its place as a primary component of the overall marketing mix.
But before we confront these critical process issues, marketers must clearly understand just who, exactly, the independent influencers are. A rough estimate tells us that there are millions of these influencers out there. And this is a largely untapped mid-tail market. We're not talking about top-celebrity or high-profile bloggers, who are over-committed, over-exposed, and frequently overly demanding when they interact with brands.
No, the millions of independent influencers are an army of potential brand advocates who share enthusiastically with the consumers whose decisions determine a brand's success. Most of these influencers are not well-known, but they have the ability to spur meaningful commercial growth and change. According to McKinsey, this group generates three times more word-of-mouth messages than non-influencers, and each of these messages has four times more impact on a recipient's purchase decision.
Trust and transparency are of paramount importance here. Influencers' audiences must believe that they are authentic, competent -- and even expert -- in their messages.
A recent eMarketer survey confirms that the quality and personalized nature of the social connection between influencers and their audiences is key to making word-of-mouth communications work. When asked what type of person is most influential in the social media space, 57% of the respondents chose someone with a handful of fans, friends, and followers that are tightly connected. Only eight percent chose someone who has millions of fans, friends, and followers with little or no connection. All of this tells us that authentic and honest connection between marketers and influencers, and between influencers and their consumer audiences, is crucial to the best brand-building today.
Russ Fradin is the CEO of Dynamic Signal. Dynamic Signal was founded in 2010, and is composed of digital media veterans from Adify, comScore, Yahoo, RealNetworks, and Google, and is backed by Trinity Ventures, Cox Enterprises, and prominent angel investors.