Why and How Leaders Must Engage in Social Media

When I did a presentation on social media for C-level women executives last year I argued that leaders must engage with stakeholders in order to lead engaged organizations. I believed that then; I believe it now. People just can’t do “social media appreciation,” they have to participate at some level in order to understand how it really works. If they don’t understand how it really works, how can they assess how well their organization is doing?

In the interim, I’m happy to note that there has been research on the issue. The BRANDfog CEO survey published in the spring has gotten considerable attention. It quotes Aman Singh of CSRwire and Forbes.com as saying:

Transparency, vision and open communication are key to great leadership and corporate social responsibility strategy today. . .customers expect to hear from the executive leadership team on social media channels, as a direct way to connect and engage with the brands they love and the causes they support.

The data I find most compelling is that 82% of respondents are much more likely/more likely to trust a company whose executive team communicates openly. That is the gist of my argument.

When I sat down to write this post I looked for other recent studies. I was only mildly surprised to find that IBM’s Executive Exchange has a larger, personal interview survey fielded about the same time; IBM is good at social media, externally and especially internally. Again, one quote seemed to nail the situation: 

Though CEOs frequently mentioned dipping their toes into social media waters, few claim to be personally immersed. This arms-length involvement puts CEOs in a precarious position. They are making critical judgments about a disruptive technology without much firsthand knowledge. And they’re uncomfortably reliant on the counsel of less experienced Generation Y advisors. “For the first time in my career, I feel old. People in their 20s work and think about this social stuff in a different way,” a U.K. insurance industry CEO shared. “We’re using it as a way of connecting with friends and socializing; the kids coming up are using it as a way of life.”

These CEOs see social media use increasing by over 250% during the next five years to become the second most important way of engaging with customers. They still see face-to-face as number one. Over the same time frame, they see the importance of traditional media decreasing by over 60%.

The IBM argument is that connectedness through social media is not just a customer issue. Open communications also build and strengthen ties with employees and partners. There is no implication that it is three separate streams of communication. At the CEO level it’s about vision and values with detail on activities mostly left to the functional specialists. There is no implied platform recommendation either. The advice is “Be where your customers expect you to be.” They emphasize the importance of mobile to expectations about timely information. However, in this context mobile is not a platform. It’s a way of delivering social networks to customers according to their expectations.

The picture is one of a media world in the process of revolutionary change and the IBM study making the clearest statement I’ve yet seen of CEOs knowing they need to be part of that change but not knowing exactly how.

So I go back to my original argument; leaders need some personal exposure. Writing in WSJ, Dr. Alexandra Samuel has interesting recommendations leaders and would-be leaders should read for themselves. She sees interesting time-saving value in effective use of Twitter and mentions pressure for CEO blogs. She also suggests having some fun (“Build a Golf Course”) while learning.

If social media is essential to corporate communications and if executives can engage in ways that use time effectively, what reason is left not to engage in a personal and meaningful fashion?

Does Search or Social Media Have More Impact?

Of course there’s a secondary question—impact on what? For several days I’ve been thinking about two specific questions:

1. Does search marketing or social media drive more traffic to websites? I’m going to limit it to PPC and not include SE0.
2. Does PPC or social media have more impact on sales?

Both sound pretty simple and straightforward, right? If we believe that, we’ve forgotten all we know about the interconnectedness of media. Nevertheless, starting out with two specific questions led me to some interesting data.

Going backwards, we also know that question two is not as simple as phrased; there is immediate impact on sales and delayed impact. From early studies we know that web exposure, which was mostly display advertising at that time, had some immediate conversion impact but also had longer-term impact. In other words, it often took more than one visit for a consumer to decide to make a purchase. Think about your own behavior—does that make sense? We also learned that conversions occurred offline in retail stores after consumers had visited websites. That was a pretty common phenomenon in the early days, “research on line buy offline.” Again, we’ve all probably done that. Are we more likely to just go ahead and buy online today; probably depends on a number of things.

The same is true of the online vs. offline conversion issue. These 2005 data seem pretty straightforward. More people convert offline. comScore went on to say that they “analyzed the time lag between consumers’ initial searches and subsequent purchases made in the same categories during November and December of 2005. . .more than half (56%) of consumers’ online holiday buying actually happened in subsequent internet sessions, clearly demonstrating the strong latent impact of search.”

I’ve been looking for a replication of this study ever since. I’ve never found one. Does that mean that the latent impact of search has become part of Internet marketing conventional wisdom and no one sees the need? I did find a marketer’s analysis of a single campaign in 2009. He found that initial Google results were faster to come in than Yahoo’s, but that 31% of all results came in after his (approximately 1 month) campaign was over. I’ll take that as confirmation until someone shows me otherwise.

Ok, so here’s what I found in terms of traffic. The answer to question 1 looks pretty simple, right? Search is the winner by a huge margin. But look at what else eMarketer said (newsletter, October 22, 2009):

According to research by ad network Chitika, social sites Facebook and Digg are more likely to send returning traffic your way than search engines such as Yahoo!, Google and Bing. More than one-fifth of users referred to a site by Facebook visited at least four times in the course of a week. Less than 12% of Google-referred visitors were as loyal.

It doesn’t say that the loyal users were more likely to buy, but would you agree that the likelihood of a purchase goes up with repeat visits? It does seem likely; how much is unanswered, at least in any recent research I could find.
The most interesting data I found is this 2007 study of the influence of newspaper advertising on web traffic. 44% of people who saw an ad did additional research; 67% of them did their research online; and 31% went to a search engine first.

But strong brands matter; in 2009 Nielsen found that 61% of the holiday traffic of retail web sites came from direct visits, not search. A Nielsen spokesman said:

the fact that such a high percentage of people go directly to retail sites and even those that search generally have a pretty clear intent as to which website they'd like to go to -- it makes a compelling argument that brand and past experiences [with a marketer] matter an awful lot and will be far more significant determinants of success than any customer acquisition strategy that they're going to engage in."

That’s really interesting. Two things strike me. First, that’s holiday shopping data for retailers and it may be different for purchases during the rest of the year. Second, all marketers have to do customer acquisition, so the question as to whether social media or search is best for acquisition still matters. Each and every marketer has to answer that by looking at quality vs. quality of initial referrals and the persistence of customers who were acquired in various channels—in other words by Customer Lifetime Value. At the same time, it’s unlikely that one acquisition channel will ever be enough; the question is allocation of resources.

Question 2 one more time--does search or social media have more impact on sales? Here’s data from the current Razorfish Fluent Report. Offline friends are most trusted when making a purchase—WOM again and always. TV was also trusted by these respondents, then “online” activities of several types appear. Search is down at the bottom as far as trust when making a purchase is concerned.

The issue is not straightforward in the sense that either search or social media is “best.” However, there seems to be a pretty clear picture in these data. Search brings more people to your site; social media gives them more trusted information on which to base their purchases. It’s not either/or.

Several times while I was looking for data I came across a good piece of advice. Marketers must measure the impact of various media at each stage in the conversion funnel. It changes from “just looking for information” to “deciding to buy something” and in between. That’s the real message; marketers must use all the tools in their arsenal—wisely!

Customer Experience Counts in All Channels

Forrester recently completed its 2010 customer experience ranking. Data was collected from 4,653 US consumers in November 2009. The full report is available only to Forrester clients, but Bruce Tempkin released key summary statistics yesterday.
His summary of the findings, much of which is displayed in this chart, is interesting:

• Retailers take 12 out of the top 20 spots. I’m happy for them, but I also wonder why retailers appear to think that customer experience is more important than do other types of businesses that sell things—B2B or B2C, products or services?
• Healthcare, Internet and TV services dominate the bottom. Quelle surprise! We all have our stories. My most recent one is yesterday. I called a physician’s office for an appointment instead of her competitor whose office’s customer service was dissed on local ratings services. So far, so good—the appointments secretary was nice to me on the phone!
• There was very little excellence. Again, not news to most of us. Excellent customer service, and it’s outcome, excellent customer experience, is a sustainable competitive advantage. Why? Because it’s hard and it requires upfront investment.
• Liberty Mutual improved the most. Interesting. I’ve actually paid attention to their “responsibility matters” TV advertising. I wondered how that fit into their ability to improve customer experience, so I decided to look around.

What I expected to find was some trade buzz that Liberty Mutual had really been working on its customer service. Maybe they have, but that’s not what I found. I found The Responsibility Project. Business Week had an article and video interview with Stephen Sullivan, senior vice-president, communications services at Liberty Mutual. Sullivan talks about the challenges the firm faced in 2008 as it tried to expand market share in the face of competitors who could outspend and customers who didn’t trust. He says:

"It's a wonderful thing to say that we do the right thing, but it's also a more difficult message to get across to consumers because so many people want to say that," says Sullivan. "What we wanted to say is 'We recognize that personal responsibility is one of your core values and if this is true, then you will like doing business with a company like us because we share that value; in fact, we celebrate it on your part.'"

That view is the core of The Responsibility Project. TV is the responsibility of Hill, Holiday. PR comes from Ketchum, which describes the project as follows:

The Responsibility Project, created by Liberty Mutual, uses entertainment content to create a forum for people to discuss personal acts of responsibility. Through short films, online content and television programming, The Responsibility Project is a catalyst for examining the decisions that confront people trying to “do the right thing.”

Take a look at the project website. The entertainment content is obvious with short films from Liberty Mutual and “responsibility partners” including NBC, Slate and BeliefNet. I was interested in the box that describes their outreach to bloggers at the summer BlogHer conference. The site is reasonably interactive with a blog and an opportunity to post stories, vote on issues and make comments.

Individually, the pieces are impressive. More impressive is the degree to which Liberty Mutual integrates the “doing the right thing” into all its messaging—from the blogger outreach this summer to the career pages on its website. In the Business Week interview Sullivan made the point that employees had to believe in the message in order to be able to deliver on the promise. That starts with hiring the right people, as they are obviously trying to do. One assumes that management at Liberty Mutual is behind the program in both word and deed. Otherwise, the results wouldn’t be showing up in customer experience rankings.

Where did this all start? Liberty Mutual, of the 133 organizations in 14 industries that Forrester surveyed, improved its customer experience rankings the most. That means it supported its words with actions in a most impressive way--another best practices example.

Social media is nice. However, marketers have to use all their channels and use them in an integrated way. If the message doesn’t resonate and the experience is not satisfactory, all social media can do is to reflect customer discontent. If social media is to reflect a strong and trusted brand, business actions are going to establish the foundation. Getting the message out is important, but the actions of employees and the everyday experiences of customers are the ultimate test of strategy.

Does Behavioral Tracking Threaten Consumer Privacy?

According to a recent study by researchers at the Universities of Pennsylvania and California at Berkeley and sponsored by the Rose Foundation for Communities and the Environment, consumers think it does! Whatever marketers themselves think, these opinions threaten behavioral advertising, and we should take them seriously.

The New York Times had an excellent article when the report was published. It’s an important report, and I’d encourage you to use the link in the Times article and download it to read the entire thing. You will find careful methodology and a carefully chosen, if not huge, sample.

The findings are what’s most important, and here are two of the key ones:

• Even when they are told that the act of following them on websites will take place anonymously, Americans’ aversion to it remains: 68% “definitely” would not allow it, and 19% “probably” would not allow it.

• Americans mistakenly believe that current government laws restrict companies from selling wide-ranging data about them. When asked true-false questions about companies’ rights to share and sell information about their activities online and off, respondents on average answer only 1.5 of online laws and 1.7 of the 4 offline laws [questions] correctly because they falsely assume government regulations prohibit the sale of data. (pp. 3 & 4)

I think the incorrect beliefs about government regulations contribute to the aversion problem; it’s another instance of people feeling duped when they find out the truth. This is a societal problem, not a problem for any one business. Still, individual businesses can be open and honest about their own activities, building trust as they do so.

Both these issues are important but let me present just one chart on aversion to behavioral tracking with the two columns you need to compare highlighted.
First, note that the respondents are more willing to allow tracking when it produces discount offers they want. We’ve been seeing a lot lately about how intensively consumers are using the web to look for promotions and discounts, so that makes sense.

Second, lower table, when the question includes specifics about the information used to tailor the ads, discounts and news, the percentage of people willing to accept goes down—a little less for discounts, but they all go down. Look further; when information is brought in from other websites (the essence of behavioral advertising) or from offline, the willingness to accept plummets.

The full report also had a breakdown by age segment. Younger people are more willing to accept the tailored offers than older ones, but there’s not as much difference as I expected. And younger people show the same pattern of being less willing to accept tailored offers when the source of information is specified.

This is disturbing to the Internet marketer, and there is no easy solution. There have been a few meager efforts by coalitions of businesses and trade groups to better inform users about the nature and benefits of collecting and using consumer data and the differences between anonymous and identified data. The efforts appear to have been half-hearted and it’s clear that they had little impact.

Worse, that’s the only real solution I can think of. Do you have any better ideas???

In the meantime, keep building your trusted brand!

Consumers Trust (Some) Online Content

We know that traditional media is declining and that consumer attention and marketer budgets are aggressively moving online. One of the comments to a post last week reminded me of the importance of the question, “What content can we trust online?” That motivated me to pull out the Nielsen Global Online Consumer Survey data from this summer and take a look at it. This twice-yearly study surveys 25,000 consumers across the globe.According to the article in AdWeek, “When it comes to trust, personal recommendations and consumer opinions posted online are most valued by consumers worldwide.” Word of mouth from people you know is the most trusted. Consumer reviews posted online are second, although there’s quite a gap. It’s interesting that brand websites are equally trusted. It’s also interesting that traditional media ads rate considerably higher than do online ads.

Additional data from the study, presented in the Marketing Analytics blog, gives another perspective. The study found trust in advertising increasing across the board. According to this report, “consumers today are more trusting of every marketing channel tracked compared to two years ago, save newspaper advertising, trust in which declined a marginal 3%.

The study disclosed some good news for online in particularly banner ads. The percentage of global consumers trusting banner ads grew 27% between 2007 and 2009 and the percentage trusting ads in search engine results grew 21% from 2007 to 2009.” According to eMarketer (August 3, 2009) there are differences between various areas of the world. North America sits pretty much on the average. Even at that, the overall level of trust in online advertising could still be higher.

Why is trust growing? Better behavior on the part of marketers? More need felt by consumers? The respondents feel that advertising helps them make more informed decisions. Some even find it entertaining! I wonder how much the state of the economy has to do with it. Seventy-one percent of respondents agreed or strongly agreed with the statement, “Advertising contributes to growth of the economy.”

That shouldn’t let marketers off the hook; it seems abundantly clear that consumers are looking for information—from their friends, from online reviews, and from advertising. Doesn’t that give a strong message as to what we marketers should be doing?

Is the Answer Disclosure or Context?

Another follow-up—this one to a post on compensating Mommy bloggers that I recently wrote for Reaching Women Daily. In that post, I argued for disclosure of any compensated blog post and suggested some guidelines for marketers who want to reach out to the vast blogosphere of mommy bloggers. (If you’re not aware of the vast network of connected moms or are looking for data, you might find this recent report by Razorfish and Café Mom useful.)

So I was interested in today’s 3-minute Ad Age video, an interview with one of the founders of BlogHer.com. According to the interview, they have a different approach to disclosure. It’s not on a post-by-post basis but requires the creation of separate blogs for compensated posts and those that are purely personal opinion. View the video here.

I searched the site (I’m not registered, but I didn’t find any parts I couldn’t enter) and I didn’t find an example of what Elisa Camahort Page describes in the video. I also couldn’t find a community rule that specified it exactly. What appears to be the newer BlogHerAds section may be the execution of the “context” policy, although what it says in the editorial policy is:

Contains editorial content that has been commissioned and paid for by a third party, and/or contains paid advertising links and/or spam. Every opinion expressed must be the true opinion of the author.

They certainly are concerned about blogger compensation; so is the FTC, which is still in the review process but intends to issue guidelines that will affect bloggers as well as other endorsers.
However, I wonder about the context issue. Thinking about how people read (or perhaps how much they often ignore), it seems to me that a disclosure policy like the one I reproduced in the post or a segregation of compensated posts still may not be enough.

If each post that had compensation (including “freebies”) associated with it had a simple disclaimer statement, wouldn’t that be better? That way it’s precisely where the content is located, not in a disclosure or an about this blog statement that might not be read.

That’s where it would be most visible and most meaningful. That would be good for readers; less good for marketers? Maybe, although in the long run, I still believe that transparency rules!

Compensating Mommy Bloggers--The Virtue of Transparency

This post was originally published in the ReachingWomenDaily blog.


As I recounted in the first post in this series, I originally became fascinated with mommy blogs by watching my daughter, a new mother at the time. I gradually became aware of their potential as marketing media, although in those early days, I was thinking mostly about their value for targeted online advertising.

I was also intrigued by the number of blogs that were busily distributing coupons.I should have realized sooner that there was more to the coupon activity than meets the eye. It began to dawn on me when I saw this press release and visited the Jessica Knows blog. Her right nav bar has clear indications that she is affiliated with various brands. She also has a clear disclosure statement.

This blog is a personal blog written and edited by me. This blog does accept forms of cash advertising, sponsorship, or paid topic insertions. We will and do accept and keep free products, services, travel, event tickets, and other forms of compensation from companies and organizations. The compensation received will never influence the content, topics or posts made in this blog. The owner(s) of this blog is sometimes compensated to provide opinion on products, services, websites and various other topics. Even though the owner(s) of this blog receives compensation for some of our posts or advertisements, we always give our honest opinions, findings, beliefs, or experiences on those topics or products. The views and opinions expressed on this blog are purely the bloggers’ own. Any product claim, statistic, quote or other representation about a product or service should be verified with the manufacturer, provider or party in question. This blog may contain content which might present a conflict of interest. This content may not always be identified. To get your own policy, go to http://www.disclosurepolicy.org/

For several months there has been a lot of buzz about compensating bloggers (WSJ, subscription required) but most of it hasn’t focused specifically on the mommy blogosphere. Here’s a good example; this post explains the controversy surrounding Chris Brogan’s Kmart posts and links to Chris’s reply. The controversy raged for awhile even though Chris’ posts were clearly labeled as being sponsored. The mommy blogosphere is so active there are now various lists of top ten mom blogs. This one focuses on the coupon blogs. I took a look at all 10 and found the following:

• Only one had a disclosure statement and it seems word-for-word the same as the one above. It probably came from the same place. Good for these 2 bloggers!
• Most of the others give clear evidence of monetization. I’m basing that on the blogs being hosted and design and navigation suggesting the use of a professional programmer.

My sample size of 11 blogs wouldn’t pass the “representative” test, but I think the results are compelling. Mommy bloggers are being compensated in various ways and they aren’t bothering to disclose it.What should marketers do? I think it’s obvious that they should require a reasonable level of disclosure. The disclosure statement in use seems to cover the waterfront and it would make sense to require it of affiliates. Perhaps what the business is supplying to bloggers makes a difference, so I’d further suggest:

• Coupons. The mere distribution of coupons through blogs doesn’t seem to create a huge issue. Do users care where coupons come from? I don’t think so! Is there sometimes paid travel or other compensation for the couponing affiliates? It appears so, and disclosure of that would be desirable.
• Product descriptions and ratings. Full disclosure is required when products are being discussed. Consumers have come to rely heavily on peer ratings, and they want to know if the recommenders are truly peers or whether they are compensated endorsers.
• Content. Be sure to brand any content that is made available for use in the blogosphere. That protects both sides.

Wal-Mart seems to have gotten it right with their Elevenmoms blog. It’s linked to the Wal-Mart site and the bloggers and nature of their activities are disclosed. From there, it’s a matter of how well done and useful the blog is. If consumers find value, they will use it. And Wal-Mart, apparently having learned its lesson a couple of years ago, isn’t letting itself in for brand-damaging disclosures.

Transparency Rules!

Author Notes: The second post in this series can be found on RWD. Soon after this post was written the FTC began an investigation of compensated blogging.

Transparency and the Media

I’m working on a post for Reaching Women Daily that includes admonitions on transparency, so Bob Collins’s retweet of an article in TechCrunch about the 104-year old British woman who Tweets caught my attention—thanks, Bob! A little exploration revealed more interesting facts.

First, this story seemed to originate with UPI, part of the traditional media establishment. They should have checked their facts more carefully.

First, does Ivy Bean, resident of the Hillside Manor in the UK, use Facebook? Not exactly. Search Facebook and you’ll see what I mean. I counted 30 or so facebook pages on the subject of this Ivy Bean (obviously there are other people with the same name, but most of the fan pages have picked up the same pic, so they’re easy to identify). This is the largest I found, the Ivy Bean Appreciation Group with 2019 members. She probably deserves the appreciation of this and other fan pages, but it’s not her page.

When you go a bit deeper into Facebook you find several pages with a message like this.

Ivy Bean is 102 years old and has been told she can no longer add anymore friends as she already has 5000 but has another 6000 requests all please join so Ivy bean can have as many friends as she wants as she is 102 thanx for support

I don’t see any Ivy Bean pages with 5000 members, so I’m guessing a prank here that other Facebook users fell for. There are a lot of people who need to get a life and the manager of Hillside Manor needs a lesson in Facebook!

Second, there are numerous blog posts that attribute the Twitter account to the Geek Squad. So I went to Twitter to find out. First thing I saw on my page is numerous people retweeting about Ivy Bean. Some were non-committal, others are calling it an unethical PR stunt. Ivy Bean does have a Twitter page, established on May 14 with 31 updates, as recently as this morning. "She" has over 12,000 Twitter followers; is following 94. I looked at a few of the people she is purportedly following—students, friends of Geek Squad members, perhaps—or just generally looking for a life??

In any event, I judge the Twitter page to be a scam. Worse, someone is perpetuating it, even after it was revealed as a farce.

The TechCrunch post says that the Geek Squad “press-released the hell out of it.” As if it was a serious event, obviously. One assumes that’s where the UPI got it, and British newspapers picked it up from there. Does no one in traditional journalism fact check any more? I just proved that it’s not difficult!

Marketers, do you want your brand associated with this kind of PR? Even little jokes can backfire. This seems to have been a serious attempt to garner press attention with false information. It also winds up making Geek Squad look like they’ve taken advantage of a 104-year old nursing home resident. I don’t consider that positive PR.

And consider the fact that it was bloggers who outed the incorrect information in the traditional press. It’s a strange world; be careful who you believe!

Can Your Corporate Blog be Trusted?

Because it represents your brand, your business blog needs to be trustworthy. A widely-quoted report by Forrester puts corporate blogs far down on the trustworthiness scale; (download the Forrester report here). I’ve written about creating a trusted corporate blog previously, but a new article on Marketing Profs makes it worth returning to. It’s a subscriber-only article; let me give you a quick summary.

According to Kimberly Smith, writing for Marketing Profs:
• Provide real value for your readers
• Be transparent to a fault
• Be direct and write in an engaging, personal style
• Welcome reader involvement. That requires moderation and a policy to guide it; I’ve written about that before also.
• Make it clear that it is an official corporate blog and what the policies are.

I’m sure you’ve noticed that many blogs that appear to be “corporate” are actually personal blogs and have the required disclaimers. Which is the right approach for your company? Or should you encourage a mix of “official corporate” blogs and personal blogs from corporate executives? Both, in fact, have value.

If you are pondering these issues, you might want to invest in Marketing Profs Smart Tools: Blog Marketing publication. It gives some step-by-step guidance that could be helpful. I’d suggest that the first recommendation is the most important; “Define blog objectives and profile your blog’s target audience.”

Your corporate blog is a communications tool, and it must be planned and managed like one. You have to build trust in the information it provides, just like you’ve worked to build trust in your brand.

But I keep asking—can you afford not to communicate with your customers? to communicate directly and without filters and artifice? That’s the way the world is moving. More important, I’m willing to bet that it’s the way the expectations of your customers are evolving. If you doubt that, ask them!

CMO to CCO?

Monday’s post looked at some of the challenges facing the CMO today. The common thread is that we must all adjust to the new media world, and in doing that we may find our jobs changed. The EIU report quotes the IBM SVP of Marketing and Communications as saying:

Some long-standing advertising agency partners are still figuring out how to help their clients make the necessary transition. The marketing agencies and the advertising agencies are really having a rough time, not embracing the new methods, but making money from them, says IBM.s Mr Iwata. Although virtually all traditional advertising agencies tout their new-media skills, some are relying on old-media business models and profit margins. For example, some agencies offer to produce podcasts and YouTube videos for clients, just as they produced print advertising and television spots. Yet they still charge clients tens of thousands of dollars, he notes, for new-media content that costs next to nothing to produce. And the clients who don.t know better say, .What a bargain compared to prime-time television. (p 17)

Ouch! I can vouch for how careful we need to be when buying services of any kind. I just ran into a situation where two services firms were offering essentially the exact same product but the charge differed by tens of thousands of dollars. Quotes for custom work often vary widely; that’s not a surprise. But I was surprised to find so much difference between two products that seemed to offer exactly the same functionality.

Mr. Iwata has been in the “chief communicator” job at IBM since July. The combination of marketing and communications under a single senior executive is interesting, especially in the light of what this study says. I looked around a bit more and found an excellent video done at the PRSA convention in October. Mr. Iwata talks about his perspective on how to meet the challenges—a worthwhile 5 minutes!(but you may have to go to the Nov. 22 post and pause that video; sorry!!)

With his comments about technology and social media being embedded into business models of all types today, the recommendations of the report make a lot of sense. They see they job of CMO morphing into a CCO in the sense of John Iwata at IBM. This gives the CCO a leadership role in:

• Defining and instilling corporate values
• Building and managing relationships among a multiplicity of stakeholders
• Enabling the enterprise with new media skills and tools
• Establishing trust with all constituencies.

A while paper by the Arthur W. Page Society calls this “The Authentic Corporation” (download from this page.) I’m writing this on the day that CEOs of the American auto makers are driving to Washington for another round of Congressional hearings, so the conclusion of this report seems especially prescient. They say that corporate:

actions and reputations, which used to be safeguarded by a cadre of professionalized functions, are now the responsibility of everyone in the enterprise. What used to be controlled within the company’s “four walls.” Is now spread across multiple partners, communities and individuals around the globe. (p. 6)
A tall order for all of us, especially the CMO/CCO!

Customer Experience on the Social Web

Bruce Temkin at Forrester Research is a tough, thoughtful analyst of Internet strategies, especially as they impact customer experience. Many of us have enjoyed the Customer Experience Rankings he does for Forrester for several years now. Customer experience is critical to success, but in the world of social media marketers no longer control all the elements of experience. Bruce has recently set forth a set of “management laws” to aid in our social media journey. In this podcast, about 9 ½ minutes long, he talks about those management laws. The theme is “weave social media into marketing culture and decision making.” It’s worth listening to.
What lead me to his blog and the podcast was a reference to another set of “laws,” these for customer experience. You can download his white paper from the home page of the blog. I’d like to quickly summarize the laws:

1. Every interaction creates a personal reaction. Individuals have experiences, not segments or markets. How can we make experiences relevant to the individual?

2. People are instinctively self-centered. Whether customers or employees, everyone views the world through their own perceptual filters. They care about meeting their needs, not your business is organized and operates. You have to give them ways to satisfy their needs. See #4.

3. Customer familiarity breeds alignment. Share customer knowledge with your employees so they can be effective in meeting customer needs.

4. Unengaged employees don't create engaged customers. Enough said. The real question is how to engage your employees. See #5.

5. Employees do what is measured, incented, and celebrated. One of Bruce’s posts led me to a page on Tesco’s website; Tesco is my absolute favorite CRM example. Their “steering wheel” is a powerful summary of what they measure—and they are good at measurement!

6. You can’t fake it. And many of us should take a lesson from discredited politicians and remember that you can’t hide it either.

Openness and transparency rule! And thanks to Bruce for the reminder that building trust with our employees is just as important as building trust with our customers. Building trust in both areas should be Job 1!

Who Do Marketers Trust?

In September Universal McCann released a new study of social media. This one is called “When did we start trusting strangers?”










It’s full of interesting data, including their listing of social media channels—wow, that’s a long list! (The full report is available here; there's also a presentation with additional data). Let me hit a few of the high spots for you.

A basic theme is the fact that we are all both influenced by and influencers in this new media world. I’ve written before about the importance of consumer ratings and other sources of individual, as opposed to marketer-initiated, information. The report asked what opinion sources people used (the question didn’t appear to include paying more attention to ads). Search and email from friends win hands down. Next on the list is visiting the brand’s website, which makes sense. That’s tied with IMing with a friend, though!

To me, the most provocative piece of data is “who do you trust?” It’s a long list. The report points out that the 4 top-rated sources are personal and 2 are online. WOM as the most credible source of information is not a new phenomenon—it’s always been the most trusted. What this says is that there are so many more ways for WOM to circulate now. That adds to its power to influence. On the marketer-initiated side you have to go considerably more than half way down the chart to find an occurrence. When you do, TV ads are the first, followed by magazine, newspaper, PPC and radio. The key issue is that these marketer-initiated communications are only rated as being about half as trustworthy as the personal sources that were highest rated. Marketers take note!

The next set of trusted sources start with consumer reviews in various channels, includes articles by known bloggers, as well as magazine and newspaper articles. That’s where the “strangers” come in. According to Universal McCann:

• We now trust a strangers recommendation as much as our closest friends

• We trust recommendations in social media channels more than paid-for communications

Big wow!

From the earliest studies of social communication we’ve known that many people were opinion leaders in contexts in which they had special interest and expertise. That’s still true according to these data. People both seek opinion and give opinion, and how many seek vs. give differs by product category. I’d also make a bet that the actual people who seek vs. give differ from one product category to another. I’d seek the opinion of one of my tech-savy friends before buying a computer, and I’d be happy to give him my best fashion advice for his big date. We have different areas of expertise.

What does the report recommend? It says marketers should:

• Be open, honest and transparent. If they’re not, they’ll get caught. Ask the politicians.
• Be part of the conversation. They actually advise marketers to advertise on the social media; it’s advertising that supports these free influence channels. Interesting point!
• Encourage everyone to contribute experiences and opinions.
• Reach out to what they describe as the super influencers, the new creators who blog, podcast, create videos and upload their photos. They should be considered “some of the most powerful voices in the future.”

It’s pretty clear who the public trusts—the best description is probably “people like me.” I started by asking who marketers trust. Do they trust their customers to engage with them in a reasonable and responsible way? Data to the contrary, I suggest that many marketers still do not trust their customers enough to engage in direct conversation with them!

Building Trust in the Social Space

The multiple ways people connect on the social web never fails to fascinate me. More important, it keeps adding to my store of knowledge about developments in the social space. A recent post on community was picked up in Social Computing Magazine, and in response I got an email from Alex Todd, CEO of Trust Enablement about their product. Trust is incredibly important in brand development—second only to a good product, it seems to me. So I researched his company with interest.

The firm offers a managerial framework for building trust with key stakeholders. The stakeholder group I’m most interested in is customers, so I followed that thread. They have just conducted a survey with 366 responses that deals with what managers need to do to create trust in online social networks, broadly defined. Here’s some of the data I find most compelling. Basically it says that management needs to learn more about how to develop conditions that promote trust. Firms also need to lighten up on controlling practices that suggest lack of trust in your brand and your products (interpretation mine; obviously I feel strongly about issues of letting your customers have their say).Ok, so you agree with me! How do they do it? These images are from a presentation made to MBA students at McMaster University. They have identified six factors that contribute to the development of trust. Each factor has particular impact at a given stage in the brand development process. It’s reminiscent of the old hierarchy of advertising effects and similar in tone to the new media model I set out last year. To build a trusted brand the marketer needs to move people through a process beginning with, in their words, “Discovery” and culminating in “Advocacy.” Right on.

How should marketers go about doing this? The resources needed for trust development are:
• Experiential sources
• Interpretive sources
• Empowerment (to make the choice)
The practices that protect trust in a brand are:
• Motives
• Proficiencies/expertise
• Risk transference.
At each stage/for each element there are specific marketing activities that can be undertaken.

There’s lots of food for thought here and more in the sources I’ve used here and many others on the Trust Enablement site. Two things seem especially useful to me. First, there is a set of stages in trust development that parallels the stages of brand development. Second, there are specific marketing activities that need to be employed in each stage to build trust.

There’s also the more general message. Enterprises/managers don’t know all they need to know, they often don’t have the appropriate attitude set, to go about building trust. They often seem to be trying to protect themselves from their customers instead. Does information and openness lead to trust? I think so!

Financial Service Aggregators and Trust

Last week I received an email from Aimen Minhas, VP marketing at start-up PageOnce quickly followed by one from Guy Goldstein, CEO (listen to WSJ podcast here). They were reaching out to bloggers with information about their service, which is currently in private beta.

Essentially their message is that the user Finds (adds) the accounts--from financial services to social networks--that she wants to manage, Views and manages them from a single page and then Relaxes, letting PageOnce take care of details involved in managing all these accounts. It's the type of aggregation for the convenience of users that Internet pundits have been talking about since the early days.

Their emails came at a particularly interesting time. Someone, an amateur fortunately, had gotten the number of the credit card I use exclusively for Internet purchases. I was busy and hadn't checked my accounts for a few days; might not have noticed it right away anyway because the amounts were small and the amount of my total bill wouldn't have prompted me to look at the detail. Bank of America, though, caught it right away because there had been two $0 purchases recorded which customer service explained was the thief testing the account. BofA sent me multiple emails and left a voice mail. From there it's kind of a long story, only because I was away from home and got back Sunday night when the system was updating and couldn't be accessed. But a hold was put on the account right away and on Monday morning I did all the right things to get it taken care of. So far all the joker had actually purchased was two memberships in Match.com--isn't that trackable if anyone cared enough?

BofA handled this well and prevented further damage. Isn't that exactly what they are supposed to do? How would another layer of security help? All I've read suggests that PageOnce has strong security in place; certainly their executive team has strong IT backgrounds and extensive security experience. All the pieces are in place, but I wonder how easy it's going to be to get users to commit financial services data to an unknown site.

One of my students wrote about another financial services aggregator on our Internet marketing class blog a few weeks ago. I'm not making a link because the blog will go down sometime after the semester ends, but I'd like to quote some of what Yolanda said about Mint.com:

Although it looks a great way to handle your finances, I still feel skeptical about typing my accounts information in the site even though Mint claims to have high security. The company teamed with Yodlee, an on-line banking-service provider, to make secure connections to banks. The registration is anonymous because the system just asks for your e-mail address, password and zip code. The company also claims that it never stores password information or see account numbers. In spite of all these claims, I still do not feel secure on typing my account information on the site. I am not definitely in my twenties and maybe that is why this thing of sharing information still scares me. However, if my bank could provide this kind of service, I would definitely look forward to it. (Yolanda Cantu, May 5, 2008, Internet Marketing at Harvard Extension)

That's interesting on several levels and when we had a few minutes to talk about it others (mostly thirty-somethings) agreed. It takes a high level of trust to sign up for a service like this. You might accept such services from an institution you already know and trust; BofA went up several points in my estimation as a result of the quick action in my instance. Building trust for an unknown brand takes time, as we all know. For PageOnce that may be compounded by the fact that they are allowing social networks, which are leaky faucets as far as data privacy is concerned, to be part of the system. When I questioned this, Aimen Minhas pointed out that users can choose which accounts to enter (or not). Good point.

PageOnce is clearly a service in the Web 2.0 mold. If you want to check it out, sign up for a beta account. I wish I could say there was nothing to lose, but that's not true, and it's the challenge that services like this have to face. What else do you think financial services sites should do to build user trust for web and mobile financial services?

TouchLocal Reaches Out

A few weeks ago I wrote about UK site TouchLocal that was offering Internet users a trusted environment in which to exchange information and search for local businesses. Today I got an email from them. This is only the first or second I’ve gotten; they definitely aren’t pestering me. But they clearly are reaching out to encourage users to write reviews of local businesses. As you can see from their advertising page, they are also working to get local businesses to add their listings. That’s not an easy thing to do if my local area is an example of local business use of the web—and I suspect it is.













So reaching out for reviews is a nice thing to do. Is it worth a couple of airline tickets? Two recent studies suggest that it is. The first, reported in Marketing Charts, indicates that product recommendations/reviews are the most important issue in bringing customers back to a retail site. The passivity is also evident here; US users seem to be more interested in reading the reviews others have written than in writing their own reviews. Interesting. Even more interesting is the age and gender differences seen in the study results:


•Fully 41% of those age 18-24, the prime demographic for the social web, say they’re most likely to return to a site that makes recommendations. Only 29% of those 55-64 say so.
•Women are far more likely to be influenced by a welcome greeting - with 20% saying it’s the feature most likely to get them to return, compared with 12% of men.
•The older you are, the more you want to give feedback: The upper three age groups were more likely than the bottom three to say that a site that solicits their feedback is most likely to make them return.
•A few groups went against the overall trend by not selecting “recommendations” as their No. 1 choice: non-whites (they chose both “unique experience” and “feedback” ahead of recommendations), those with post-grad education (”unique experience” was slightly higher), and those with incomes under $25K (first choice was the “welcome”).
•There’s a wide gap between the lowest-income bracket and all others:
oOnly 26% of those who earn less than $25,000 per year chose “recommendations,” 10 percentage points below all other income categories.
oRespondents in the lowest income bracket were far more likely to prefer a “welcome” - 27% said it was the feature most likely to make them return, at least 13 percentage points higher than the other income categories (14% of those earning $25K-$50K and those earning $75K+, and 12% of those earning $50K-$75K agreed).
“The economy is fragile and the competition for the consumer dollar is fierce, but as these findings make abundantly clear, online commerce is now a two-way street - and retailers need to embrace that reality,” said Jason Meugniot, Guidance president and CEO.

Another confirmation comes from a Forrester study via eMarketer. Once again product reviews top the list, even more desirable than special offers or price comparison tools. Similarly, the ability to upload one’s own content is at the bottom of the list.

My own experience suggests that just making it easy for users to contribute may not generate much activity—especially the older and the more upscale your target audience is. The TouchLocal contest is one way—a relatively expensive one!--to reach out. I wonder what else can be used to motivate the passive viewers to become active contributors. Any ideas?
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Income Tax and Social Media--Really??

360i’s David Berkowitz had a great post on his blog not long ago. In the press of events I ignored the original one, so I’m glad he did a reminder and gave links to the social media pages. What struck a lot of us, including the Wall Street Journal, is that a tax preparer—not a breed known either for innovation or sense of humor—was mounting a campaign that included major elements of social media.

H&R Block’s Digits site might be described as a community site. Apparently people actually do want to discuss tax-related issues. I looked at some of the “Current Conversations” and I believe they have used professionals—some from H&R Block, others creative professionals—as conversation starters. That’s a good idea, and it seems to be working, judging by the number of comments. As seen on the home page they are even in Second Life, although I’m not sure I’m eager to find my Tax Mojo!

Besides Second Life, the campaign includes pages on Facebook, MySpace and YouTube. When I looked at the Facebook page, I suspected the young man singing the Ode to Block was a paid presenter. The MySpace page introduces Truman Green as the young man at the center of the campaign. I found he listed his profession as “blogger.” Given his singing, maybe he should keep that as his day job. Couldn’t resist that--but the fact is that he’s professional but informal—probably a good selection for what is obviously a campaign targeting the young adult market. The YouTube page is also Truman’s page.

I’d particularly encourage you to look at the Facebook page. There’s a lot of stuff going on there—an interesting model to consider. Clearly this is a professionally-designed and managed campaign, not a DIY effort, but we all can learn from it. One thing to think about is that they apparently have used paid presenters as well as their own professionals. It rachets up the quality level of the campaign. They haven’t exactly posted banners about that aspect of it, but people are carefully identified and I see no attempt to deceive—to flog. They did, however, advertise on both MySpace and Facebook to draw people to the page. That seems to be Facebook’s model—take a look at their Business pages.

And now, I’ve got to go finish my taxes—really!
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Parsing Facebook User Data Policies

Read part 1 here.
Third Parties and Facebook Data. Continuing on down the Terms of Use we find a section on Third Party Websites and Content that is inclusive, although once again they try to exclude offensive material and protect intellectual property. Just below that is a section called Share Service. This is a direct quote from that section:

Company offers a feature whereby users of the Site can share with others or post to their own member profile, videos, articles and other Third Party Applications, Software or Content from, and/or links to, Third Party Sites through the Service (the "Share Service"). You acknowledge and agree that your use of the Share Services and all links, User Content or Third Party Applications, Software or Content shared through the Share Service is subject to, and will fully comply with the user conduct rules set forth above and the other terms and conditions set forth in these Terms of Use.

Does that mean that “perpetual, irrevocable and distribute. . .for any purpose” apply here? I’m not a lawyer, but that’s what it looks like to me. It goes on to talk about Use of Share Links by Online Content Providers. Are these the 15,000+ widgets shown on Friday’s post? That’s what it sounds like to me. Here’s what it says:

By including a Share Link, Online Content Provider automatically grants, and represents and warrants that it has the right to grant, to the Company an irrevocable, perpetual, non-exclusive, transferable, fully paid, worldwide license (with the right to sublicense) to use the Share Service in order to link to, use, copy, publish, stream, publicly perform, publicly display, reformat, translate, excerpt (in whole or in part), summarize, and distribute the content, links and other materials of any kind residing on any web pages on which Online Content Provider places the Share Link.

That should drive potential developers to the Developer Terms of Service page, which is also quite extensive and technical. It seems to repeat the same data policies. There are many links, none of which I investigated.

Finally, I took a look at the Privacy page (from the top nav bar; the Terms of Use is one of the text links at the bottom of pages). This page allows users to set several parameters for the sharing of their data with other Facebook users. It’s user-friendly and when I’ve tried, it has worked as described. The introductory statement is designed to make users feel comfortable:

Facebook wants you to share your information with exactly the people you want to see it. On this page, you'll find all the controls you need to set who can see your profile and the stuff in it, who can find and contact you on Facebook, and more.

However, it is not their Privacy Policy, which is another text link at the bottom of pages. It is also extensive. This is a short quote from the lengthy Information We Collect section:

If you choose to use our invitation service to tell a friend about our site, we will ask you for information needed to send the invitation, such as your friend's email address. We will automatically send your friend a one-time email or instant message inviting him or her to visit the site. Facebook stores this information to send this one-time invitation, to register a friend connection if your invitation is accepted, and to track the success of our referral program. Your friend may contact us at info@facebook.com to request that we remove this information from our database.
Facebook may also collect information about you from other sources, such as newspapers, blogs, instant messaging services, and other users of the Facebook service through the operation of the service (e.g., photo tags) in order to provide you with more useful information and a more personalized experience.
By using Facebook, you are consenting to have your personal data transferred to and processed in the United States.

There are lengthy sections on sharing information with third parties and advertising that I haven’t quoted. They are worth reading. Facebook’s Beacon service for advertisers has generated considerable controversy. This is the current statement:

Facebook Beacon is a means of sharing actions you have taken on third party sites, such as when you make a purchase or post a review, with your friends on Facebook. In order to provide you as a Facebook user with clear disclosure of the activity information being collected on third party sites and potentially shared with your friends on Facebook, we collect certain information from that site and present it to you after you have completed an action on that site. You have the choice to have Facebook discard that information, or to share it with your friends.
To learn more about the operation of the service, we encourage you to read the tutorial here. To opt out of the service altogether, click here.

From my perspective as a marketer, not a lawyer, Facebook seems to be honest in describing its policies, and the documents are detailed and inclusive. Does anyone believe that teenagers will read the material—only a tiny portion of which is quoted here? If you do, I have time-honored bridge to sell you.

Marketers should give these issues consideration from several perspectives. Do you want to participate in advertising on Facebook itself? There are numerous ad networks that serve the Facebook applications (widgets, etc.); that’s another alternative. Recent articles from Randall Rothberg of the IAB and Esther Dyson, IT maven, are both ad-friendly and give worthwhile perspectives.

Put all of it together and two things emerge. One is that marketers need to tread carefully as they consider advertising on social networks; both the contextual and the data privacy issues are troublesome. The second is that marketers may want to build their own networks. We’ve been doing that with email addresses. Why not extend permission-based activities to relevant networks? Either create your own or partner with an established network that is relevant.

Whichever of the several ways you choose to go, think carefully about how you want to inform and prepare visitors for the kind of advertising they will see or receive. We all want to do targeted advertising. But behaviorally-targeted advertising can get downright creepy—“How do they know that about me?” We don’t want to creep-out our customers!
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Visualizing the Social Graph

One of the fun things about doing research for a blog like this is that one thing leads to another. Yesterday I briefly mentioned the term “data visualization” in the context I think most marketers use—how can we transform mountains of raw data into graphics we can use for understanding and decision making? At least, that’s how I’ve thought about it ever since statistics and marketing research courses.

But I ran across a couple of sites that reminded me of something else—the “social graph.” With the rise of MySpace, Facebook and specialized social networks, it’s a concept that has been much discussed over the last year. My personal opinion is that it is not different from the idea of social networks that many of us remember from sociology courses; Wikipedia has an article that describes the sociological concept. Chris Brogan has a brief video that does a good job of tying the two concepts together and Mitch Joel has a thoughtful post on the subject. The Economist had a contrarian view last fall.

“Social graph” is clearly the term used in the social networking space, so I’ll stick with that. We are all part of multiple networks today, for better or for worse. Even for us as marketers, some of it is personal, as when I posted my travel photos on Flickr and invited friends to view them. Others are clearly work; probably most of the people who read this are on LinkedIn or some other professional network. Some would be best described as research. I continue to maintain that all marketers should have multiple accounts on sites like Facebook, MySpace, Second Life and other new media sites. We should join some groups and visit from time to time. How else do we know what’s going on? Having it filtered through employees or our teen-aged children is just not the same thing.

The really cool thing I ran into is a set of applications listed on Mashable.com that allow users to visualize networks of various kinds. These are only two of the 16 applications they list:


That lead me to check out similar applications on Facebook. I’m not a serious user, I’m a research user, so I was astounded to find that there are over 15,000 apps that Facebook users can put on their sites. Here are some of the currently most popular—notice how many of them connect users with one another. No wonder that WSJOnline reported this week (subscription required) that MySpace had opened its platform to allow developers to build apps for it! Lack of this “fun stuff” may be one reason MySpace has fallen behind Facebook. If you are into diy, Google recently announced a Social Graph API that allows users to build graphs from publicly-available data and connections.
Finally, it made me stop and read the Terms of Use and Privacy Police on Facebook. That’s a subject in and of itself; I’ll return to it next week.

The implications for marketers and advertisers are clear. In the past, we had to conduct segmentation studies in order to identify homogeneous groups of customers and prospects. Now users are doing it themselves. How far should we go to take advantage of the social groups that are forming on the web? That presents troubling issues of privacy and trust that marketers need to consider openly and carefully.
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