Social Media – Panacea or Fad?

Depending on whom you ask, Social Media is either the ultimate communications tool to build your brand and make your customers love you or simply the latest shiny new toy for marketers wanting to appear cutting edge but with little or no return on investment.

My 2c worth – it is both . . . and neither.

For a start, Social Media is not a media at all – certainly not in the traditional mass sense. Sure, the 500 million (and counting) people on Facebook are a large audience but they are not there to simply watch and listen, they are there to participate. They constitute a very large number of interrelated communities where like minded people congregate to talk about and share – well, just about anything.

Broadcast or Chat?

Do you want to talk to the population or speak with a defined community? ie are you looking to broadcast or have a conversation?

If you are a large company like Telstra and wish to position your brand with the whole of Australia then there is certainly a place for this but Social Media sites are not that place. Consider that Telstra has 4363 Facebook friends (last I checked) – less than 0.02% of Australia’s population. Even if we assume that just half of the population are in Telstra’s target market this is still a very small result for the investment.

However, if you have a defined audience with a common interest that relates to what you have to offer then Social Media may provide an opportunity to join or start a conversation.

We Haven’t Sold a Small Car Since 1997. Want to Buy One?

In launching the Fiesta in the US market (the first compact car launch since they withdrew from this segment 13 years ago), Ford could have produced a great television commercial. Instead, they gave 100 consumers in their demographic a free car for 6 months. In return the consumers had to complete monthly “missions” and communicate about them in their Social Media communities.

Ford received 6.5 million YouTube views to the 700 videos produced, 3.4 million impressions on the “Fiesta Movement” on Twitter and 670 000 hits on the photos taken by the 100 participants. These are big numbers but so what? More important than “hits” is that Ford was able to initiate a conversation with a new audience. 50,000 consumers (97% of whom had never owned a Ford) requested information about the Fiesta and Ford sold 10, 000 units in the first 6 days of sales.

Ford identified the niche that it wanted to communicate with. They facilitated a conversation and then allowed them to speak with each other, sharing their own experiences and making up their own minds.

Ford provided the context but let its audience develop their own content. This is the key to Social Media success – marketers can be part of the conversation but cannot control it (or do so at their own peril).

What Is Your Social Media Strategy?

If you are starting with this question then you run the risk of falling into the “shiny new toy” camp. Before you work out your Social Media strategy you first need to work out if you need one at all. Consider these questions first:

What are your business and marketing objectives?

What are your business and marketing strategies for meeting (or exceeding) these objectives?

Does Social Media fit with this?

Who is your target audience and are they part of social media communities? If so, are they open to your brand joining their conversation?

Only then can you begin to develop a strategy for engagement.

To Conclude

In short, Social Media provides a great opportunity for brands to engage with defined audiences but you must be prepared to commit to a conversation, not simply a message broadcast.

Be clear on your objectives and broader strategies and only then should you consider if Social Media is appropriate.

Remember, Social Media is neither a panacea nor a fad, simply a potential tool in a marketer’s arsenal.

Lessons From The Last Year

No doubt about it, 2009 wasn't easy but as they say, we learn through adversity. Over the summer I reflected on what I learned in 2009 and in gathering similar feedback from other marketers I have compiled a list of lessons from the last year.

I am not as smart as I thought I was nor as dumb as I feared. When times are good, it's easy to believe you, or your team, created the momentum that you are riding. When times are not so good and that momentum is gone and you're still doing the things you've always done, you realise that you're not as smart as you thought. If you have the good sense to realise that the macro-environment has changed and you adjust, you're not as dumb as you feared. That's what happened to me and our marketing/development efforts in too many ways to detail in this post. A little humility and a lot of hard work are required in good times or bad.

The brand matters except when it doesn't. Our brand mattered throughout 2009 and continues to matter. What the brand doesn't do is close the sale. In 2009, every sale was harder to close for a myriad of reasons: the customer didn't want to spend the money, the customer didn't have the money to spend, prospects were delaying buying decisions, competitors' pricing didn't make sense, etc. If you believe your brand is bullet-proof, think again. You've got to prove everyday that your brand has value and do the hard work to nurture a prospective customer to a close.

Don't lose your head while those around you are losing theirs. In 2009, some pricing decisions from in the market were astounding in their lack of foresight and/or possibly desperation. In some cases, companies seemed to be giving away their products or services. While these firms made have had strategic (or cash flow) reasons for these pricing decisions, they confused the market. Smarter companies (or at least that weren't faced with staving off immediate oblivion) responded and continue to respond to pricing pressures but didn't lose their heads because they knew that 2010 was coming, and then 2011, and so on. They took the long view in order to be here to provide the same level of quality and service.

Moving forward requires taking a step back. When things get hard it is tempting to assume the "head down - tail up" position and push forward. The problem is that in this position you can't see where you are headed and what obstacles might be in your road. There are times to run hard but don't forget to pause and consider the bigger picture, question your assumptions and think differently about your business, your market, your competitors and your approach.

Relationships are key but hard times touch everyone. When the client who loves you and your work but doesn't have the money, s/he doesn't have the money. When the intermediary who has worked with you for years and believes you are the best choice for a number of reasons has a client who is only interested in price and the market is full of extremely low-price competitors, the relationship with that agent won't bring the sale. That doesn't diminish the importance or power of relationships. They need to be continually nurtured through good times and bad.

Testing is good but not when it hurts. When budgets are tight you have to make sure every dollar is working hard. If you don't test you won't improve but be honest about what it really costs and make sure that even allowing for unsuccessful activity (how else will you learn?) your overall cost per acquisition is within your allowable. This applies in good times and bad but in tough times it is more challenging due to generally lower response rates.

It's better to be the tortoise than the hare. Short-termism may save the day but if you take your eye off where you are headed and compromise those things that you (and your business plan) hold sacred then when the fog clears you may find yourself far off course and unable to get back to where you - and your brand - need to be. Weigh every seemingly short-term decision against the longer-term consequences. Perseverance and a daily focus on the finish line can get you there.

I'm looking forward to 2010 and the challenges that it will bring.Bring it on!