Hope everyone is well?

Plenty of news across the social web this week…

LinkedIn and Twitter ad revenue will slow

According to a new report from eMarketer, the ad revenues of two of the largest networks will decline this year. Though the numbers are still impressive, with Twitter’s ad growth predicted to be up 83% with revenues of $540m. LinkedIn will see $226m in ad revenue through 2012, and by 2014 60% of the company’s income will come from US sources and top $405m.

eMarketer forms it’s estimates of social network ad revenues through a meta-analysis of data, from dozens of research firms, company information and industry trends. This forecast represents an upward revision of LinkedIn’s revenues and growth rate compared with eMarketer’s previous forecast, issued in September 2011, due to a stronger-than-expected advertising program on the site. Twitter’s ad revenues are close to those expected last September, with growth continuing on the expected trajectory for an additional year.

Bald Barbie after Facebook campaign

Corporations are slowly realising that their customers can be a valuable component of their product or service development teams. After contacting Mattel about an idea for a new bald Barbie; to highlight hair loss in those with an illness, and receiving no response from the company, Rebecca Sypin and Jane Bingham set up their own Facebook page that currently has over 142,000 likes.

Companies clearly can’t follow up every idea they receive for a new product, but in the past consumers had no other channel to publicise their ideas. Today, social media platforms are offering this voice to any consumer. Once again, corporations need to pay close attention to the exposure that they are receiving and integrate this where possible into their product development cycles, and also include these touch points in their customer services activity.

Read about how Dell uses customer feedback in our exclusive feature Made By Us.

Personalised soup wins Heinz fans

The development of f-commerce continues apace, with personalisation of products rapidly gaining market traction including some from Heinz. The company tested the use of personalised products by allowing customers to send special bottles of Balsamic Tomato Ketchup to Facebook fans. The company has now gone one step further and is utilising digital print services to personalise their soup cans.

Social commerce will grow to $30bn in 5 years

The development of social commerce has been rapid, but according to a new report from Booz&Co ‘Turning “Like” to “Buy” Social Media Emerges as a Commerce Channel’, this is set to top $30bn by 2017. The report concludes:

“Social network sites promise to be the next generation of e-commerce engines and are moving rapidly in that direction. Marketers and strategists are smart to feel a sense of urgency in understanding and experimenting with direct commerce within these platforms; early movers will have a solid foundation on which to build their social commerce capabilities as the platform evolves. As always, learning what doesn’t work will be as important as learning what does.”

It’s still very early in the development cycle for social commerce to yet make a major impact on a corporation’s bottom line. However, unlike e-commerce, social commerce does have an impetus that shows no sign of slowing. Only those companies that begin planning now, and test how social commerce can be integrated into their businesses will become the market leaders in their sectors.

New analytical engine for retailers

IBM has just released details of its new analytics platform, which aims to help retailers make sense of the petabytes of data they have about their customers. The new IBM Netezza Customer Intelligence Appliance addresses data overload issues by providing retailers with big data analytics that allows them to analyze all customer interactions within their brand.

A combined offering from IBM and business partner Aginity, and Cognos software, lets retailers gain a single view of each customer, spanning all channels and sales touch points, including mobile, online and in store shopping. This means retailers can gain insights on the fly, better predict and target products and promotions, as well as improve store design and pricing.

Bass Pro Shops adopted IBM’s new appliance to gain insight on their customers’ needs and provide better products and shopping experiences across all their channels, consisting of retail stores, boat dealerships, internet and catalog sales, wholesale, and hospitality, including restaurants and world class destination resorts.

“IBM analytics allowed us to quickly get information across our multiple channels and lines of business in one place to deliver meaningful analytics that drive top line and bottom line results,” said Leslie Weber, Chief Information Officer at Bass Pro Shops. “We can now create and deliver more targeted promotions, circulars and catalogs to create a better customer shopping experience.”

Using the new appliance, retail clients can now also expand their predictive analytic capabilities, with SPSS Predictive Analytics and IBM’s Global Business Services, allowing them to go deeper into customer segmentation and business analytics than ever before.

Brands connect with customers via virtual currency

Brands like social gaming behemoth Zynga are reaping the rewards of linking their gaming platform to the social networking space. Juniper Research has estimated that the virtual currency space will be worth nearly $5bn by 2016. The virtual currency space is already proving to be highly popular and lucrative, with over half of the top grossing apps in Apple’s App Store using the virtual currency model.

However some brands are now levering the loyalty they have cultivated from their social media channels – most notably Facebook – by offering credits managed by the start up Plink. These credits can then be used in games like the Sims. Major brands including 7-Eleven and Taco bell have already signed up for the low cost scheme. Expect to see more movement in the virtual currency market as virtual gaming and social networking move even closer together.

In Brief…

Huge growth using social media in customer service

A new infographic from Zendesk makes for very interesting reading especially if your corporation is looking at how its customer services can be integrated with social media. The data shows that 62% of consumers have used social media to make a complaint. As consumers continue to embrace their social networks, nearly half now prefer to receive customer support via these spaces.

Facebook IPO infographic

The numbers attached to the imminent Facebook IPO are staggering. A day doesn’t seem to go by without a new set of statistics being released. This infographic pulls all of the more important and relevant data.

Profiling Pinterest users

If you’ve wanted to know what the profile is of the average Pinterest user, data from comScore will make for interesting reading. According to their report the vast majority of the site’s users are women aged between 25 and 44 with a household income of between $25 and $75,000.

£12.7bn is how much Facebook is worth to the EU economy

A new report commissioned by Facebook has shown that the company has a major commercial impact on the EU economy. Focusing on just the UK, the report states that Facebook supports over 35,000 jobs and delivers £2.2bn to the county’s GDP.

Trust survey reveals surprises

One of the key foundations of social media is trust. The Edelman’s Trust Barometer for 2012 has shown that corporations and especially CEOs have fallen behind peers in the trust stakes. The report also shows that within the social media space has increased by a massive 75%. However, the survey does point out that most consumers need to hear something several times before believing it. It appears that corporations must develop several social media channels to get their message across and convince their customers that they can be trusted.

Until next time….

The Useful Social Media team

Facebook has more than 800 million members, and most of the active ones tell each other on a regular basis what they like and dislike. In theory, these individuals can be profiled: simply by age and gender, or in detail according to their buying habits and preferences.

So the Facebook community is a potential goldmine for businesses, especially those in the B2C space. You can keep close to customers, telling them about new products and services, and getting their opinion through comments, reviews and polls. All you need is a corporate Facebook page that those customers and potential customers “like” and visit on a regular basis.

That’s where the theory starts to come unpicked, because getting from corporate Facebook page to targeted fan-base is quite a leap. One way of populating a corporate page is with existing customers: but that relies on an opt-in by the customer, which may not be easy, unless there is some kind of incentive, or unless the relationship is likely to be a continuing (and mutually advantageous) one.

Waiting for the fans to arrive

Of course, it’s possible simply to build a page, promote it alongside other online marketing initiatives such as your corporate website, Twitter and so on – then wait for the fans to arrive. The problem here can be likened to the empty restaurant scenario: it’s less likely to attract potential diners than one that is (say) 30% full. A page with few – or no – fans just doesn’t look very inviting. 

One seemingly attractive solution is to buy fans, and a quick Google search shows there are plenty of businesses offering hundreds – even thousands – of targeted fans for your Facebook page – at a price of course.

There are various ways in which these fans-groups are created. Facebook advertising is one source, which – as Alex Taylor of Custard Media says, can be targeted with extreme precision, covering demographics including age, gender, interests, likes, etc. He stresses the need for an integrated social media programme, but explains that: “Using Facebook advertising, we can target a company’s competitors, customers and other people who already have a current interest in their brand.”

Martin Petts, managing director of Social Stamp says Facebook users can “be profiled by pretty much any of the criteria that they have entered in their personal Facebook profiles [including] other pages that they have ‘liked’.” However, he emphasises that buying a targeted fan-base is just the beginning: “If a company is buying Facebook fans they will not be engaged instantly, even if they are of the correct profile.”

Other vendors of Facebook fans use backend websites or portals that have free subject-specific content such as downloads, games, videos, competitions and money-off coupons. People who access this content are offered or given an incentive to become a friend of client Facebook pages for a limited period.

Clients still need to make an effort

Mario Johnson of Blumpo uses a Facebook application that enables “demographic targeting to profile users’ information from their profiles”. However, he also strongly emphasises that “it still requires effort on the client’s part to engage the fans with meaningful content to build a relationship with the brand.”

Of course, all this presupposes that the fans are genuine. SEO specialists who use “black hat” techniques to improve search-engine rankings have stung many businesses, and plenty of agencies that promise thousands of targeted fans turn out to be just as dishonest.

Graeme Olsen of South West eCommerce, an Australian internet marketing specialist, tells a cautionary tale of buying targeted fans for an Australian page and a UK page. “We paid extra for the “targeted fans” option [but] it became clear early on that all fans were from the USA.” They also noted that fans were posting identical “weird/random” comments on both pages, leading them to suspect that “many of the fans (or at least the ones that comment) are either junk profiles, or perhaps paid to join our page and comment.”

Taking simple precautions

A few simple precautions are needed here. Firstly, as with all distance buying, take the time to sift through the suppliers and their offerings. This is absolutely not a time to choose the cheapest option, because it’s almost impossible to compare like-with-like. Do everything possible to check the supplier’s credentials: if the website doesn’t have a phone number you can call, a legitimate postal address – not a PO box number – and a business email address, it’s probably best to look elsewhere.

Martin Petts of Social Stamp says that when calling a social media marketing company, they should give you free initial advice: “Explain to them what you are trying to achieve and they might give you an alternative to buying Facebook fans that will work better for you in the long run.”

And if the agency checks out and the references seem genuine, buying a fan base can work for the right kind of business. A supplier of games software, who preferred not to be named, is a case in point. “We bought a thousand fans for our Facebook page when we first built it. The leads were guaranteed genuine, and were targeted by location, age and interests.

“Each of these fans has friends who are likely to have a similar demographic profile, and who will get the chance to link to our page, opening us up to maybe 50,000 people. That should give us several hundred new followers – and hopefully a few new customers.”

Custard Media’s Alex Taylor agrees with the philosophy, saying that, for the right kind of business “buying a fan base or building a community [of] like-minded individuals can prove very effective. Imagine having a group of potential prospects in a room that you can pitch to.” 

The bottom line is that buying a fan base can work: it just needs careful planning, and a recognition of the potential pitfalls with this kind of marketing activity. The maxim “buyer beware” needs to be front of mind – before taking the plunge.

Hope everyone is well? We’ve moved our weekly update and will be posting on a Wednesday from now on.

So, onto the social news and analysis of the week!

Tech companies need to be more sociable

You would think that tech companies would have embraced the social networks, but research carried out by PR agency EML Wildfire showed that technology companies are missing out on the potential of social media by not being social and failing to use these new channels to engage with their audiences.

While tech companies understand the importance of social networking, only 31% of brands with a Facebook account used it to engage with users and, of those that used Twitter, only 14% of tweets were replies and retweets. When it came to the companies that had a blog, only 20% received comments and only one company took the trouble to reply to comments received.

One of the most interesting findings this year was that the use of Facebook amongst B2B companies had skyrocketed in the last 12 months with 70% of B2B companies on the platform compared to just 40% previously. Overall, Linkedin was still the most popular network used (92%), followed by Twitter (80%).

YouTube remained the least popular for the second year running (44%). Despite the increase in adoption, most companies were still only using these channels for ‘push’ marketing techniques with 65% of companies with a Facebook page using it for one way communications and 96% of blogs simply broadcasting article and news content without inviting responses.

Debby Penton, Director at EML Wildfire said: “The vast majority of businesses we speak to now accept that social media is something they should be doing. But we are still seeing confusion about how to approach these new channels and get the best out of them. It is therefore no surprise to see even some of the UK’s most successful tech businesses still struggling to adjust and approaching the situation with ‘old media’ mindset.

“Social media gives companies a unique opportunity to reach their audience directly.  But without the right strategy in place and the skills required to execute, brands could actually risk damaging their online reputation rather than harnessing the positive commercial impact that social media should and can deliver.”

Paid search increases mobile presence to 12%

New research carried out by Marin Software an online advertising management platform has released its report on US online advertising activity. The research finds mobile and tablet users accounted for 10% of all U.S. search ad clicks during Q4 2011. This represents a doubling of click share as a percent of total since Q3, 2011. Furthermore, the report reveals the click through rate (CTR) of search ads served on tablets, such as the iPad, was 38% higher than the CTR of ads on desktops.

Paid Search Key Findings:

• During Q4 2011, 10% of all clicks on paid search ads in the U.S. were made either on a tablet (4%) or a smartphone (6%). Ads served to tablet devices provided a 37% higher CTR than ads on desktops while smartphones yielded a 31% higher CTR.
• Across Google, Yahoo and Bing, paid search spend increased 35%, click volume increased 56%, CTR increased 23% and cost per click (CPC) decreased 14% during Q4 2011 on a year over year basis. The combination of improving CTRs and declining CPC, point to significant efficiency gains for advertisers over the past year.
• Compared to 2010, search advertisers on Google saw a 48% increase in clicks during Q4 2011 without an accompanying increase in impressions. CTR on Google also increased 48% while CPC decreased 7%, suggesting large-scale advertisers realized efficiency gains through improved matching and more effective bidding.
• On Yahoo and Bing, impressions increased 43% on a year over year basis most likely as a result of advertisers building more robust search campaigns and increasing spend on the Search Alliance. Compared to Q4 2010, Yahoo and Bing advertisers realized a 44% increase in click volume, a 9% increase in CPC and a 1% boost in CTR during Q4 2011.

Who are social gamers?

Social gaming continues to be a major component of the growth that corporations are seeing within their social spaces. The latest figures to come out of the Econsultancy show that nearly 20% of consumers have played social games. The frequency is also increasing with 30% stating they played more than once a day. For corporations this level of engagement is unprecedented on other channels.

The commercial value of social gaming is also increasing. According to Juniper $4.8 bn will be spent within social gaming by 2016. The question is who are social gamers? A new infographic from Flowtown reveals that there are slightly more women (54%) than men (46%) engaging with brands via their social gaming initiatives.

Turn a negative into a positive

The furore that surrounding a recent video posted by a customer of FedEx that showed their courier throwing a computer over the customer’s fence shows how corporations can turn what at first appears to be a PR disaster into a positive outcome for the company.

FedEx were quick to respond to the video that accumulated over two million hits with their own video apology from none other than Matthew Thornton III, Senior Vice President, US Operations at FedEx. The video was also accompanied by a blog post that read:

“Along with many of you, we’ve seen the video showing one of our couriers carelessly and improperly delivering a package the other day. As the leader of our pickup and delivery operations across America, I want you to know that I was upset, embarrassed, and very sorry for our customer’s poor experience. This goes directly against everything we have always taught our people and expect of them. It was just very disappointing.

“This matter is an unfortunate exception to the outstanding service FedEx team members deliver every single day. Our customers know and value that service. We have been doing this almost 40 years, and if we weren’t doing it right, we wouldn’t have gained the widespread respect we have enjoyed.  As a matter of fact, we have a very simple motto we try to live by – the Purple Promise: “I will make every FedEx experience outstanding.”

If you haven’t see the original video post and the FedEx response they are below. For corporates the use of video is becoming increasingly important. In FedEx’s case a video response was deemed to be more appropriate than simply a written apology on their website’s blog.

Loyalty means more in-app purchasing

For many businesses the development of an app has proven to be a new revenue channel that will continue to expand over time. However, in-app purchasing can be enhanced if the customer can be developed into a loyal follower of the brand. This is the conclusion of research carried out by Localytics.

The results show that 26% of new customers can indeed be fickle, installing an app and only using it once. However, the share of customers lost with each additional usage drops quickly and half of customers use an app four or more times.

More importantly, 26% of new customers also become the most loyal customers, using an app more than 10 times over the following months–and many go on to use an app hundreds of times.

Localytics also states: “The users who wait and interact with an app multiple times before making their first in-app purchase are more valuable in the long run, making 25% more in-app purchases over their lifetime as a customer. First session purchasers will make an average of 2.8 purchases in a given app during their user lifetime, compared with 3.5 purchases for all other purchasers.

“By building your app’s engagement and your brand’s presence in a user’s mind, you can generate better overall revenue based on a loyal base of repeat users. Given the 12-day average time between downloading an app and making a purchase, driving loyalty across a period of weeks will often generate greater revenue.”

 In Brief…

Antitrust action for Google?

European antitrust regulators have indicated that Google could face charges by the spring. According to Reuters: “I will receive comments from the case team towards the end of the first quarter. I do not expect anything sooner. Let us see,” said the EU Competition Commissioner Joaquin Almunia.

Wine merchant sells $30,000 worth in two months

F-commerce may be in its infancy but one company is showing that as a commercial channel Facebook can be used successfully. Australian wine merchant Winestore.com.au has see sales from its Facebook page rocket over a very short space of time. Using a combination of exclusive offers that promote loyalty, the store is successfully using the f-commerce application VendorShop Social.

Massive M-commerce growth in China

If your company has been keeping an eye on China, the latest figures from Wireless Intelligence show that mobile take up is huge and accelerating. At the end of 2011, just under a billion Chinese now have mobile connections through the main carriers. This represents a leap of 16% on last year. This was largely due to the increase of 3G availability across the country Any corporation planning its M-commerce strategy would be wise to factor in China as a burgeoning market.

Is Brazil and China the next social commerce market?

The BRIC economies have been rapidly developing for several years. The end of 2011 was, however, a tipping point for Brazil that overtook the UK as the sixth largest economy. NMK reported: “When it comes to social networking, the most noticeable trend in both countries is their growing addiction to micro-blogging. According to Mercopress, Brazil still sits in the top three countries with the highest Twitter penetration (24%) and China proves to have the fastest growing micro-blogging sphere of all times.”

That’s all from us for this week. Stay tuned for more news next week.

The Useful Social Media Team.

In the 1990s and early part of this century a few things happened: First the Internet arrived. It feels a long time ago but it’s a very recent thing. Then almost immediately people started making wrong assumptions: that if for instance a photograph appeared on the Internet, it was free to use on any other website. Even professional newspapers were guilty of this and found themselves in court for copyright and intellectual property infringement.

To an extent this still goes on but most participants have adjusted to the central truth: this is the Internet rather than the Wild West and you can’t simply help yourself. Until, that is, you end up in social media in which case a number of liberties are still taken – until a corporate takes some control.

Take the company making satellite navigation systems whose research and development personnel were tweeting about future product developments and how great the next generation of products were going to be – very much before the company was ready to release them. This needed some sort of policy statement to mitigate trade secrets being lost.

There are other less well-intentioned examples, and even as this article was being written a high profile case in which an employee complained about being fired because he was actively looking for further employment through LinkedIn went against him. The employer argued, successfully, that he was criticizing the company in public.

Examples

The way to avoid these issues is to develop a policy and share it with employees so that they understand the implications if it is breached. A good first step is to ensure that they understand the old rules count just as much in cyberspace as in the real world – so if they betray a commercial confidence online, then it’s as serious as if it is done in the pub.

Ideally the policy should be evolved before such a breach. John Whiting, head of online solutions for professional services company Deloitte, explains the first thing his organization did was to get all possible stakeholders involved. “Deloitte formed its social media policy following consultation with a range of departments across the firm, including Marketing, PR, the online team and Risk,” he says. The idea was “to ensure the firm balances the benefits of the innovation, opportunities and flexibility that social media offers while, at the same time, protecting [the company] from potential risks, including protecting client confidentiality and guarding against reputational damage. Deloitte’s policy has evolved as we have observed usage, alongside other Deloitte member firms’ experiences as our confidence in the medium grows.”

The benefits can be considerable, particularly when social media structures are put in place internally: “One example of Deloitte’s successful use of social media is Yammer, the internal social networking site,” continues White. “Deloitte’s use has grown organically to involve 5,000 of Deloitte’s people, who actively speak to each other on the site about projects, issues and challenges they are facing. It is also used to conduct internal research, request information and share relevant news stories.” However there is another caveat: keep telling people about the risks. “Deloitte has put in place the relevant safeguards and regular educational updates in order to remind members of the rules in place to protect client confidentiality.”

Context

International digital security specialist Gemalto has better reason to be aware of implications of staff talking out of turn and internal confidentialities than most – not because of any bad experience but because of its security remit. The man responsible, Tim Cawsey, head of branding and public relations, explains that there were wider issues. “We spent some time coming up with internal policies for social media use as part of a wider social media strategy we created at the end of 2010,” he says. “Social media access has been allowed within the company for a few years now. As we have a large technical community (more than 1,500 engineers help design our solutions) these are typically early social media adopters.”

This could have meant people were very much at the aforementioned Wild West stage of adoption so it was essential that the company had the right policies in place quickly. “Our policy boils down to two main points: A. Don’t give away any confidential information. And B. Do state that you work for Gemalto if you discuss our solutions in social media – i.e. don’t astro-turf. Social media offers great possibilities for our employees to network with customers, prospects, partners etc. When tweeting from a personal account we ask them to make it clear that their opinions are their own and not Gemalto’s.” His own Twitter profile has a typical disclaimer: “Views here are personal” – simple as that.

Content

Every social media policy needs to look inward and outward to cover internal as well as external interactions. The important thing is that your policy needs to run through all interactions. It needs to apply to the tone as well as to substance – so responses to customer complaints need the same tone as marketing messages no matter how got-at an employee might feel. There can be no snapping, and no “mavericks” who want to strike out with their own individual style under the company name unless your company policy is to encourage an individual style!

There are laws and regulations – libel, copyright infringement – which apply in cyberspace just as they do anywhere else. These shouldn’t need restating but as in the Deloitte example, reminding people they exist never does any harm. The internal, company-specific rulings can be more fluid and harder to apply unless they are stated overtly, which is where an explicit policy written alongside all stakeholders is a business essential.

Legal Eagles

There are a number of laws and guidelines that should be followed in any social media engagement. Data Protection applies online as well as offline and legally enforceable confidences clearly need to be kept; likewise libel and defamation laws need to be observed – although common sense should intervene before anyone wants to publish anything libellous in the first place.

Social media is a form of publishing so copyright will rest with the writer unless they are a member of staff writing on the company’s time, in which case the company will own the rights. This applies regardless of the subject; the fact that it’s about your company doesn’t mean you own it. Given that social media is publishing it’s important to bear in mind that contempt of court applies and there have been test cases.

Again, common sense should intervene before hate crimes, racism, sexism or other antisocial behaviours become an issue. These are laws; consider also the regulations and guidelines enforced by, for example, the Advertising Standards Authority, which includes strictures on misrepresentation and honesty in statements.

It’s a cliché, of course, but the speed with which Facebook has developed is astonishing, with over 800 million members signing up since February 2004. However, this pace seems relatively sedate compared with the speed with which Facebook selling has developed. It’s less than three years since the pioneer Facebook shop was established: the first sale was of a bunch of flowers in July 2009. Since then, Facebook selling has become a way to market for businesses as diverse as clothing retailers and travel companies. And it’s not just consumer brands that use the medium: Caterpillar construction equipment [www.cat.com], Hyster forklifts, Adobe software, and Staples office products are among hundreds of major B2B marketers promoting on Facebook.

So, how to go about it? Are there any rules for selling goods and services on the social networking site? To some extent, answers to this question must be provisional, because the environment is changing so rapidly. A fundamental requirement (to state the obvious) is the creation of a Facebook store, although some brands make do simply with a Facebook page. In truth a simple page cannot be used for selling on Facebook, although it can help drive potential customers to a regular commercial website.

Building the Facebook storefront

A fully featured Facebook storefront can be overlaid on the fan page, and the better ones have a high degree of customisation to suit the brand, products and offers. Kevin Galen is President of ShopTab, a leading supplier of Facebook storefronts whose customers include Coca-Cola, Coleman Outdoor and Barneys New York. He says that “Facebook is wide open for the selling of many different types of products and services” 

At the heart of this coupling is a recognition of the changes that social media has brought to the marketplace. Consumers have recognised that they now have a voice of their own, and an audience for their views. They readily share information with their peers about the benefits (or otherwise) of the products they buy, through online product reviews. Empirical evidence suggests that this peer information carries more weight than conventional marketing communications.

In this context, brand advocacy becomes an important element in social marketing, and can be even more important than pure product sales. Getting products into the hands of people most likely to recommend them – through fan-gates, “closed” fan-stores and fan-first exclusives – will help improve this advocacy.

For this reason, among others, Kevin Gralen says that aggressive selling on Facebook doesn’t really work: “We recommend that the best approach is a softer selling approach coupled with giving their followers special value in terms of exclusive products, uniquely packaged offerings, discounts or rewards.” 

So what can be sold to the Facebook community? Tim O’Brien, President of custom publishers High Velocity Communications says that, in theory, anything can be sold as long as it carries the right offer. However, he points out that in general, Facebook is more relevant for consumer than industrial products because of its fundamental nature as a constant communication tool. “That said,” he continues, “our client Caterpillar maintains a Facebook page, and some Cat dealers also have pages which they use for retail offers.”

Success or failure?

Facebook selling is not guaranteed to succeed. ShopTab’s Kevin Gralen says that most Facebook shop failures result when “a client launches the store without a clear strategy on how they will engage their followers and promote their store.” Tim O’Brien agrees, saying that the fundamental rule is to “plan it well, then follow-up and use it.”

Would it matter if Facebook disappeared?

These referral sales are perhaps a pointer to a paradox about Facebook selling. Some industry experts predict that the social commerce market (which is more than Facebook, of course) will be worth $30bn in annual sales by the end of this decade. Others think that more business will be done on Facebook than Amazon within five years.

And yet, according to a study for shop.org by Forrester Research many US businesses put the importance of Facebook way behind other forms of online marketing, and a staggering 68% said that if there were no Facebook, it would have no effect on their business. On the other hand, that study was published in May 2011 – and as noted above, things have changed, and continue to change, at an exponential rate.

Follower marketing

It’s also important to remember that – as things stand – Facebook is as much about brand advocacy and support than simply ringing up sales. As noted previously, the concept of “follower marketing”, with campaigns, products and online stores designed solely for those who sign up to a particular brand is one which is rapidly being refined and implemented.

Of course, it’s possible to have all this within a dedicated e-commerce website: but how much better to put it in the middle of 800 million-plus consumers. Speaking about Facebook ads, Kevin Gralen notes, “We really like Facebook’s ability to provide hyper-targeted users (eg, by age, sex, education, interests, work), which makes advertising worth testing for most clients.” He goes on to explain that “Facebook advertising conversion rates are much higher if the user is kept within Facebook – ie, in a store – to review your product or service, instead of immediately moving them off to a website.”

It’s probably safest to say that Facebook selling will form, particularly for FMCG brands, an increasing part of the sales environment. Some critics see it as a fad, but some critics also saw Facebook as a fad. The site has shown itself to be very nimble in adapting to the needs of its own market, so we should not be surprised if Facebook selling, and follower marketing, become even more popular in the future.

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To learn more about social reviews and other essential social commerce strategies, check out the Social Commerce Summit, taking place on the 13th and 14th March in Boston. The conference features expert insight and best practice from companies like Disney, Macy’s, Staples, Nieman Marcus and H&R Block. Find out more here.

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Many businesses are finding the often cited “long tail” approach to marketing pays them handsomely when they aim for specific niches in social media. There are businesses that have used the new networks for recruitment, for finding investment and for numerous other purposes. To have your eyes opened search Facebook for Marriott Hotels; you’ll find not only a recruitment video, which is commonplace enough, but also a game in which players’ role-play different tasks in hotels and end by applying for a job online should they so wish.

For most people the idea of role-playing making a bed or working in a kitchen would sound ferociously dull; this of course is the essence of niche marketing – it doesn’t have to appeal to loads of people, just the right ones.

Raising cash

A number of companies have found that turning to a subsection of their social media contacts has paid handsomely when they are looking for funding. Stateside there are many companies doing this in the technology niche. In the UK organisations such as CrowdCube have enabled smaller businesses to raise as much as £100,000 by selling tiny stakes in their business to masses of individuals. At the time of writing three businesses including CrowdCube have been funded this way and publicized the opportunity, gaining more investors, through social networks.

Not everybody opts to use an aggregator like CrowdCube. Scottish brewery BrewDog went straight to its customers and members of its social networks – Facebook page members, Twitter followers and people on its own forums – to attract the £300,000 it needed for a new facility in a scheme called Equity for Punks, same as it had done with some success two years previously. It completed the latest round of investment ahead of schedule in early 2012 and co-founder James Watt attributes that success to social networks.

“Social media has been a major influence on the success of Equity For Punks,” he explains. “Thousands of craft beer fans rushed to promote the campaign via Twitter and Facebook when it was announced, providing a huge boost in investment.” In fact over the months that the shares were available the business acquired almost 6,000 new investors. “Our scheme is the first to be executed via e-commerce in Europe, so promoting it digitally was imperative,” continues Watt. “We wanted to utilise our influential social media profiles to spread the word beyond traditional media, we even broadcasted an alternative Queen’s speech on Christmas day that immediately resulted in a glut of investment that saw the final two per cent of shares sold. It’s certainly helped us in a big way, we even had to close Equity For Punks early as we reached to £2.2mil before the deadline, which rocked.”

Other niches

Clearly, however, a business needn’t be looking for investment or indeed be wanting to “rock” particularly when it goes in search of niches. There may be no need of a niche activity like investing – it may be a simple matter of looking for niche customers.

Michael Barber was tasked with sourcing new business for his employer Neuxpower, which makes file compression software. This isn’t going to appeal to anyone but people with the largest compression needs for the moment, and on joining the company he realized that niche marketing was the way to sell it. “One example is bid management professionals, these guys deliver huge word and PPT files to win multimillion and billion dollar projects,” he says.

So he had to approach a niche and also approach one in a B2B environment, which is typically a weak area for social networks. “Using social media to engage B2B customers is tough, we know that the consumers of our software in this niche use Twitter a small amount but the LinkedIn groups are very popular with this audience,” he says. Getting LinkedIn right was therefore key. “Our approach to LinkedIn is to contribute when it’s relevant, but our future strategy involves developing content that fits this audience’s wider needs as well as looking to create some ambassadors within these groups, which due to high levels of advocacy is progressing nicely.”

In future there will be other niches, he says. “What would follow would be an analysis of their social media usage; where do they talk about what they do? How can we contribute to that forum?”

Approaches

There are different approaches going on here. One is to turn an existing customer base into a segmented niche by asking specific questions. 6,000 new shareholders is an impressive record in anybody’s terms, particularly in the current economy and even if many of them hold under £1,000. It would of course be ridiculous to claim that this is the majority of Facebook group members or Twitter followers. The other is to go out and look for external niches and exploit them constructively.

Both have proven successful in the right context. And since they use social media rather than any other sort of marketing it’s pretty clear that they will be paying for their staff’s time working on the niche campaigns but keeping other costs down.

The long tail is a phenomenon of the Internet age, but one that is expanding thanks to the rise of social networking. The large social networks can of course be mined for the niche customers your business is looking for. However, the long tail could also influence the development of the social networks themselves.

Exclusivity could become a watchword in this environment with highly specialised social networks developing to cater for increasingly focused consumers. For corporate users of social networks this could deliver a highly qualified customer base that simply could not be reached via traditional marketing methods.

Hope everyone is well?

Your news update across the social web this week…

Social media proliferation out of control in corporations

A report just out from Jeremiah Owyang of the Altimeter Group has shown how many corporations have let their social media involvement run out of control. In the report Owyang says:

“Like a disease, social media proliferation will leave companies crippled — unless they develop a strategy to manage now. Some companies have opened a virtual Pandora’s box: We found that global corporations are struggling to manage an average of 178 business-related social media accounts — a number likely to grow if unchecked. Beyond coordination challenges, unchecked accounts and disparate customer interactions expose brands to a host of legal, compliance, and fragmented brand-perception risks.”

The report also looked at how effective corporations were at coordinating their social media efforts and found that many enterprises struggle to make sense of the social networks they use. In fact, the report states that on average a corporation will spend $272,000 attempting to manage their social presences. Owyang also pointed to the lack of maturity in the applications that are currently available for tracking and monitoring social media.

Bad reviews are good for business

The positive effects of negative publicity have been highlighted in a new report from the social commerce software company Reevoo. It may seem counter-intuitive, but the company has found that 68% of consumers are more likely to trust the reviews they see when they see negative as well as positive reviews on a company’s website.

In fact, a whopping 95% of consumers stated they would be suspicious that the company had faked the reviews if they were all positive. Consumers spend four times as long on site when they interact with bad reviews, trust the reviews they see far more and convert nearly 70% more often.

Also, the research has highlighted some interesting customer behaviour: When a consumer sees a negative review, they move onto another product on the same site and don’t instantly click away from the retailer. Less than 1% leave a retailer after seeing a badly reviewed product.

The report states: “It’s always hard to listen to criticism. However, the criticisms in bad reviews can be an incredibly valuable early warning system from your customers – if you’re listening to them. Bad reviews provide the kind of highly detailed feedback you’d normally get from thousands of pounds worth of market research. Negative feedback helps you improve everything from marketing to customer service to product design, while giving you the opportunity to demonstrate how responsive you are to your customers.

“Higher conversion is the natural consequence of consumers spending longer on your site, viewing more pages and trusting what they read. Consumers who seek out negative reviews outperform the average visitor to your site on all of these metrics, leading to a 67% rise in conversion rates for these shoppers compared to those that don’t look for negative reviews. Strange as it seems, bad reviews are one of the most effective conversion tools out there.”

Inbound marketing works

Businesses that have believed that if they build a credible and engaging online presence consumers will come to them with little or no marketing may be right. According to a new blog post and infographic from HubSpot, inbound marketing can be highly effective. HubSpot also have a free eBook about how to develop an inbound e-commerce marketing strategy.

The infographic is interesting as it restates that referrals and personal recommendations are powerful marketing tools that all corporations should be making the most of. Certainly disruptive marketing such as banner ads should be in your marketing mix, but again, social media reins supreme as the most direct method of influencing inbound marketing activity.

HubSpot states: “Consumers connect, rate, discuss, and consume product information and reviews like never before, making a strong online presence paramount for all sizes of ecommerce businesses. E-commerce inbound marketing makes it possible for online stores to take advantage of the emerging social revolution by gravitating consumers to their own brands and products, driving organic and social media traffic and sales, lowering COCA (cost of customer acquisition), and increasing the adoption of customer retention along the way.”

Luxury brands missing mobile commerce

In the first ever Prestige 100 Mobile IQ report, New York based research company L2 has revealed that many of the world’s top brands are missing the boat when it comes to mobile commerce. Ranking 100 top luxury brands, the report labels nearly half of those assessed as ‘feeble’ in their m-commerce initiatives.

While more than half the brands in the Index maintain both an app and a mobile site, 16% of brands have yet to produce either. Icons such as Hermès, Patek Philippe, Bottega Veneta, and Marc Jacobs rely exclusively on their traditional site experience, which in some cases proves inaccessible on mobile devices.

Ground zero for growth in prestige exists in emerging markets among a burgeoning middle class who are increasingly turning to a small screen to learn about and ultimately purchase prestige brands’ products.

Said Scott Galloway, Founder of L2: “Our thesis is that competence in mobile is inextricably linked to shareholder value in the prestige industry. Key to managing and developing a competence is an actionable metric. This study attempts to quantify the mobile and tablet competence of Prestige 100 brands. Our aim is to provide a robust tool to diagnose strengths and weaknesses and help managers achieve greater return on incremental investment.”

Integration of social networks remains low in corporations

The distinction between a corporation engaging with social networks, and integrating these spaces into their business strategy has been highlighted in a new report from InSites Consulting. The report’s headline figure is that only 16% of senior marketers in the US are fully integrating social networks in their companies.

The piecemeal approach to social marketing is stark: Over three quarters of those surveyed had a Facebook page but only a third are fully integrating social media across their organisations. And the main reason for companies not fully integrating social media is a lack of clarity about the financial gains that can be made. Read more about ROI and social media in our recent feature on this subject.

In addition, companies are managing their social media activity by creating new posts and departments. Over two thirds of those surveyed said they had a person dedicated to managing their social media. But it appears that corporations still see social media as a bolt on to their marketing activity and not an essential component of their wider commercial strategy.

In Brief…

Top brands on Twitter infographic

Hootsuite have released an interesting infographic that shows how popular Twitter is on Twitter. The graphic illustrates how the social networking site continues to be massive popular right across business sectors, but tech brand are the most popular with the most followers that the infographic uses to assign its points and ranking. The data was compiled in December 2011.

Forrester state that 88% of US businesses now monitor their online feedback

A new report from Dell has revealed that businesses are paying more attention to the exposure their companies have online, but the report also states that only 6% consider this kind of engagement as central to their organisation’s activities.

Four Seasons unveils new $18 m website

The new online presence of the luxury hotel chain Four Seasons is now live. The company has invested heavily in the new site that is also optimised for mobile access. The company is pushing hard to expand its online presence, as currently only 12% of its revenue comes from bookings made online.

IBM expects $16bn in revenue from analytics by 2015

The leading IT giant IBM has continued with its shopping spree last month spending $387m on Algorithmics to give the company a set of tools it hopes will make it the go-to company for corporates that want to build their next generation social networks and analytical platforms. IBM hope that its Lotusphere 2012, SmartCloud for Social Business and IBM Connections will offer corporations the networking and social media tools they need to grow their enterprises over the next few years.

That’s all from us for this week. Stay tuned for more news next week.

The Useful Social Media Team.

Hope everyone is well, and Happy New Year!

Lots of activity in social media this week to get the Olympic year started…

Teen tech users still like face-to-face contact

If your business thought that all teenagers  prefer to text each other than have a real life conversation, new research may make you think again. A study from Ericcson (PDF) of 2,000 US teenagers aged between 13-17 revealed that they still prefer face-to-face meetings.

Activity such as liking someone on Facebook was seen as just a tool and that physical contact with their peers was still very important. It appears that texting isn’t the obsession of all teenagers that use texting simply as a communications tool. Also, video chat is now more important than ever with over a quarter stating they have increased their usage over the last year with ooVoo emerging as the platform of choice for video chat.

Your customers are consumers not creators

Social networks may give your consumers the opportunity to create content and join in the conversations, but a report from Forrester has revealed that the vast majority of Americans just consume content on their social networks and are not active participants. Nearly three quarters of US users of social networks maintain a profile, but they are little more than spectators. The figures are also similar across Europe.

Looking at Asia the figures are reversed with three quartets of users in China and India creating content. According to the research only 28% of Japanese users visit social networks, with less than 15% of Japanese adults visiting Facebook each month.

Also, the use of mobile technology is the focus of another report from Forrester. The reports showed that 25% of Americans, but 33% of Chinese access social networks via mobile devices. What these reports reveal is that all enterprises need to pay close attention to the actual users of social networks and not simply be blinded by the massive user bases of some networks. It seems many consumers are still browsers and not buyers.

Could G-commerce supplant F-commerce in 2012?

If your company has been focusing on its commercialisation of Facebook, 2012 could be the year that you enterprise will need to look closely at Google. A report from ThreatMetrix and Ponemon Institute looked at the security issues that consumers are concerned about on using social networks when making purchases.

While Google came out ahead of Facebook in terms of fraud prevention intentions, findings also showed more than half of consumers feel Google is more effective than Facebook at actually keeping them safe from online criminals. In fact, Google recently announced it is aiming to enhance its online retailing strategy, which some say will challenge Amazon.com. Google would partner with major retailers and shippers to enable consumers to shop for goods online and receive orders within a day for a low fee.

The survey results indicate that consumers have yet to really adopt online shopping habits through social networks. Only 32% of consumers surveyed have browsed a company’s Facebook page and then bought something on the company’s website. In turn, only one in five consumers indicated that they have purchased something directly within a Facebook storefront.

“Consumers have yet to adopt social shopping habits because it’s largely unavailable, with many retailers still trying to figure out their strategy in offering their products via social outlets like Facebook,” said Faulkner. “And with the current consumer perception that Facebook isn’t doing enough to protect against security breaches, Facebook storefronts still face hurdles in gaining widespread adoption.”

More understanding of Facebook ‘Likes’ needed

Brands clearly understand that social media is now a vital component of their marketing activity. Yet another report has, however, shown that a clear roadmap that lays out how corporations will develop their social networks is still lacking.

Coming from the leading CRM company Lithium and the CMO Council, the report succinctly states: “Consumers say they engage with brands through channels like Facebook and other social networks largely to learn about new products (55%), enter unique promotions or contests, or to play games (65%) offered specifically, and often exclusively, through these channels. Most consumers use social specifically to connect with other fans (25%) or to share positive experiences (32%).

“But considering that the overwhelming majority of consumers are looking for deals and savings, it is telling that only 43% of marketers are using their social networks to answer this consumer call. When asked to prioritize investments, special offers and promotions also place low on the list, with most marketers placing these deals as the least important investment in their mix. Instead, marketers are focusing on offline investments, search, web, and digital.”

With 2012 now under way, now is the time to re-evaluate every aspect of your social media marketing. Clearly understanding what a Facebook ‘Like’ actually means to your company is vital marketing information to obtain as soon as possible.

Engaging TV

As CES is in full swing this week, the show floors are filled with the latest Internet connected televisions. Interactivity via the TV is now gaining pace with every TV vendor having a new set that offers a range of services. This new level of interactivity is also delivering to businesses a new channel to reach and engage with their customers.

Imagine smart devices that can immediately take action based on media content or an ad being viewed regardless of its sources. These sources of media may include linear broadcast, on-demand channels, Blue-ray players, game consoles and over-the-top (OTT) Internet content. The “smart” in these devices opens a vast new world of opportunities for advertisers to engage their customers and deliver offers to them.

One company that is developing this technology is Audible Magic. From their white paper (PDF): For instance what if a best-selling suspense novelist is being interviewed on TV. A viewer is watching the show “time shifted” and doesn’t view the commercials. Yet an app on the smart TV uses CR to recognize the program and offers to take the viewer to an “Amazon-like” experience—clicking to read additional reviews of the book, comments from other fans, and perhaps the novel’s first couple of pages all posted on a box on the TV screen. Then, if still interested, the viewer clicks to authorize a “One-Click Buy,” automatically paying online for the book and the shipping.

Some observers have been critical of these ideas, saying that advertisers will just follow their audiences and that, at least for now, audiences aren’t that interested in interacting with ads. However, much of the solid evidence has proven otherwise. During a recent televised Melissa Etheridge concert, for example, nearly half the people viewing – 46% – saw saw an offer on their TV screens for a CDnow.com discount, went to the website and clicked through to learn more.

It may also be more likely that any ads or other calls to action would appear on viewers’ smartphones, as an increasing number of consumers now tweet and blog while watching their favourite shows. With audiences continuing to fragment making traditional ads less effective, systems like those proposed by Audible Magic could be the future of TV advertising.

In Brief…

Brazil is the fastest growing user of Facebook

Businesses that are looking to geographically target potential consumers via their Facebook presence should be developing their pages for users in Brazil, Mexico, India and of course China. Tracking the user statistics of Facebook by country, Nick Burcher has shown that countries like Japan for instance are not growing their usage of Facebook as fast as many companies have believed. In fact around 75% of Facebook users are outside of the USA.

Mobile payments becoming more desirable

M-commerce has the potential to eclipse even the meteoric rise of e-commerce, and with the latest Consumers and Convergence report from KPMG revealing that a quarter of Americans would welcome this technology, NFC could make major strides into the mainstream soon.

“US consumers are warming up to the ‘mobile wallet’ concept in which the mobile device will function as a payment and financial transaction instrument,” says KPMG’s Mitch Siegel. “Whoever will master the privacy challenge will gain a significant competitive edge.”

Google+ hits 49 million visits in December

The continued rise of Google+ now has some statistics to back up the claims that the platform is expanding faster than even Facebook did in its early years. According to Experian Hitwise, Google+ saw a 55% increase in its traffic though November and December.

Top ten social commerce infographics for 2011

Social commerce was the buzzword throughout 2011 as enterprises got to grips with how they could lever their social media presences into tangible commercial channels. This group of infographics shows that social commerce will continue to rapidly expand into 2012.

FT says social commerce is overhyped

A recent piece in the FT cited a number of brand owner such as Overstock.com claiming that social commerce had failed to deliver any commercial advantages with one company commenting that: “the commercial aspect of social media is overhyped and no one’s really caught that rabbit yet.” Perhaps spending more time on Useful Social Media would show these companies that social commerce is here to stay and will deliver a sales channel to any brand that understands how these platforms work in practice.

That’s all from us for this week. Stay tuned for much more best practice, insight, case studies and analysis throughout this year that looks set to be very exciting as social media continues to develop.

See you then!

The Useful Social Media Team

Ever since social media became an integral commercial component for corporations around the world, trends have become a significant driver of consumer activity. Knowing how to create and respond to existing trends through social media can increase your market share and enhance your brand recognition.

The basic definition of a trend is something novel that services an existing consumer need, desire, or want. Each social network displays this differently. Whereas Twitter trends are hot topics that users are following through hashtags, Facebook trends are ‘likes’ or the number of users that click a certain status update or private page. Google+ uses Ripples, which presents an interactive graph of who has shared a post as well as any re-shares by other users.

As a corporation, you need to perceive consumer conversations, identify the relevant content, and act on it appropriately. Tracking consumer trends is a good way to gain inspiration, helping you conjure up profitable new services and experiences for users. Sentiment analysis – data analysis done through online software – has become an increasingly popular method of achieving these aims.

There are a wealth of tracking and analytical platforms that allow you to download and examine pertinent trend data such as clicks; keyword search results; campaign results; dates; and demographics. Finding the right website that compiles this information into a simple format can be extremely beneficial. A few examples of these sites are:

• Google Analytics, which allows you to select data from a broad or specific range of traffic sources.
• Hashtags.org enables you to see trends on Twitter by day, hour, and topic in graphical form.
• Twitter Homepage where you can simply click on a hot trend to see an entire feed of the public conversation.
• Socialtoo allows you to create surveys and tracks statistics.
• SocialReport exports data into an easy-to-read Microsoft Excel spreadsheet.

Practical application

All this information can help you effectively update your social media participation to fit the interests and content preferences of your audience – a key element of trend setting. For example, Nike decided that ‘gamification’ – commonly defined as using game-like mechanics to improve customer experience and/or profits – was an innovative way to offer their sports consumers an exciting, palpable concept that directly links to their renowned theme of “Just Play”. They created a Nike+ tag running application that offered a chance to digitally “run” towards a social or rewards based incentive.

The rest of the sporting world saw the buzz gamification was garnering and began looking at ways to capitalize on it by applying it to suit the needs of their patrons. In October 2011 The Los Angeles Kings became the first sports franchise to institute full game elements that allows fans to earn points by posting, watching videos, and sharing news on social networks. This is a perfect example of one multi-million dollar business implementing a trend to their commercial advantage.

In a world with thousands of people putting innovative findings and insights on the Internet for all to see, it’s also crucial to proactively engage in online conversation. Charles Pownall, Lead Digital Strategist for Burson-Marsteller (Asia-Pacific), says, “Certain corporations tend to focus on the perceived reputation risks of open dialogue. Thus, they overlook the opportunities that exist from greater participation in online conversation, such as building solid relationships with active voices on the Internet and increasing awareness about the full range of corporate activities.”

Crowd sourcing tools such as sharing networks and branded channels will help you accomplish these goals. IBM, for example, found that patrons wished to converse directly with technical experts and guest bloggers. They responded by setting up a thought leadership program that consisted of open dialogue with adroit technical professionals on blogs and interactive Youtube videos. A collaborative effort like this can lead to a wave of inventive, prosperous ideas.

A marketing campaign that produces buzz while simultaneously turning customers into brand loyalists is the best way to become a trendsetter. These people choose to spend time interacting with you online because they believe in the value of your message. Marketing through social responsibility programs via Facebook and Twitter (i.e. Pepsi’s Refresh Campaign) is a clever way to display a strong sense of community and generate a solid contingency of consumer advocates. With these influencers’ spreading the word to their own social media sphere, you’ll considerably increase awareness and establish your idea as a trend.

In order to retain these newly acquired customers, you must identify the proper channels to carry out each campaign. Jaime Radow, Personal Brand Consultant and Trend Forecaster at XYZ Life Coaching LLC, says, “You need to measure where results are coming from and properly invest in those channels. If a specific channel isn’t delivering results, don’t continue to invest in it. The most common mistake is trying to be everywhere because there is a lot of buzz on a particular topic.”  What’s trending on Facebook may not be on Twitter or LinkedIn. Make sure you select the appropriate apparatus to convey and update your message.

Every day billions of aspiring, demanding consumers are looking to fill an insatiable need for innovative brands and trends. A visionary approach towards trend watching, online conversation, and marketing campaigns will ensure your corporation is setting trends rather than waiting for them to arise. In the end, this will lead to a strong market presence that continues to reverberate with stakeholders and users across the fabric of social media.

Starting out: Quantitative KPI tracking

KPIs form the bedrock of performance measurements right across the corporate environment. The KPI is held as tangible proof that a new initiative has delivered – or not – on its expectations. Clearly understood within the business community, KPIs are, however, being forced to evolve with the growth of social media.

Developing a KPI for any of the social media that your company uses can be challenging to say the least. At its most basic, your company could simply set a target of, say, 100 Google Alert mentions. Once this number is attained, your initiative would be deemed a success. However, social media and your business’ ability to monitor it is much more complex.

On the basic quantitative side, you have a plethora of KPIs to choose from –  followers, follower-to-following ratios, re-tweets, lists, friends, fans, likes, pokes, impressions, mentions, visits, bounces, and a whole slew of new vocabulary and quantitative results to track. Yet, for all these ‘quantitative’ measures – all of which have been turned at one time or another into KPIs for marketing teams – it’s not clear which – if any – of those measures are reliable, or even worth analyzing in such a complex space.

Current metrics aren’t fit for purpose

At a time when companies are increasingly realising that social media impact is not simply about followers – or even £ and $ – there is a real need to develop new metrics to track success.

The very nature of social media puts the focus when generating appropriate KPIs squarely on those ‘other types of success’ rather than on direct profit. As Seth Godin puts it, “It’s marketing and stories and connection and tribes and commitment and structure that build businesses. The technology is essential, but it’s not nearly enough.”

You can easily take “technology” and replace it with “numbers” and you have the current problem plaguing business owners.

In social media, the numbers just aren’t enough. We’ve gone beyond simple one-way, bullhorn type communications like radio and television advertisements and into the era of attracting and retaining attention. You wouldn’t show up to a networking event and spend all night shelling out business cards without taking the proper time to get to know the recipients. In the same way, social media requires a deft touch.

One third of senior marketing executives believe that the quality of a business’s online presence is the key driver of corporate reputation and 52% believe that their participation in social media is a key factor in how their business is perceived according to the Socializing your Brand study from Forbes. Reputation and perception are not often words you see next to sales figures unless they’re in the marketing copy. Even so, that’s the beast we’re dealing with – and why KPIs for social media are so variable in reliability.

A softer touch for more accurate insight

The soft KPIs of ‘customer engagement’, ‘brand awareness’ and ‘brand loyalty’ are precisely the kind of thing that social media is best at influencing – and indirectly lead to gains in sales and other hard KPIs.

Tea Silvestre, “The Word Chef“, provides social media marketing recommendations to large businesses on a regular basis. She suggests tracking discussions on the various platforms, “Don’t just monitor conversations about your company or industry — actively SEARCH for issues using Twitter, Facebook and Google Alerts so you can address them proactively. When you’re able to provide answers [for hot topics] before you get asked directly, you build credibility and authority for yourself and your brand. All these can conversations can be tracked and counted.”

It’s hard to quantify soft metrics like:

• Brand loyalty.
• Attention of the visitor while checking out your online store.
• The shareability of any given post on a social media site.

Accurately measuring against KPIs on these types of interactions is speculative at best and subjective voodoo at worst. Harder still, understanding which of the soft metrics to use for maximum effect in your business is a huge challenge.

What is the return on investment (ROI) of a dinner meeting with your best client, after all? The ROI of one business card of a hundred, handed out at a networking event?

The problem is clear – without knowing which soft metrics contribute to the more quantitative metrics like followers, fans, and likes – it becomes a lot harder to accurately measure success based on any one factor or KPI. Compounding the issue – a narrow view of which KPIs are actually valuable and useful.

Sean MacReady, Social Media Specialist at Otterbox, says: “Share of voice is the most important KPI we measure. It gives us an idea of where we stand against our competition in the social sphere.”

Share of Voice is a measure of your product’s mentions vs the number of total mentions for your industry’s products or services. Sean also listed off a few other metrics Otterbox tracks, “Twitter followers, @mentions, YouTube views, Facebook likes, age/gender/location of Facebook followers, visits to the blog, post visits, referrers to our website, search engine terms, and a few more.”

Missing from his list – ReTweets, Bounce Rate, Time on Site, and Comments on YouTube. “Anything else just wasn’t beneficial to our brand or engagement,” Sean added.

It’s time that business owners realize that social media has opened up access to an entire new set of valuable KPIs and it take time to study them. Before social media, these were hidden behind the scenes – word of mouth between friends was not broadcast publicly on Twitter or Facebook. Back then the reputation of a business couldn’t be accurately measured in star ratings on Yelp and Google. Those KPI’s were, at best, guesses back then – and there was no reliable way to measure them. But now that we’ve emerged from the dark ages of last decade, business owners still haven’t caught up.