September 19, 2010

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The 6 Most Important Issues in Social Media Now that social networks have achieved global scale, the conversion shifts from quantity to quality. The process of sorting, filtering, weighing, segmenting and valuing social networks as marketing tools is important because American’s spend nearly a quarter of their time on social networking sites and blogs and 85% of users engage brands in the social media space. Here are the 6 biggest topics for the next phase of the ongoing marketing conversation. Differentiation. Facebook has 500 million users. MySpace has 60 million. Twitter has 145 million and LinkedIn is up to 60million. What’s the difference between them? Jason Witt and his colleagues at MySpace argue that there is a qualitative difference between the people who opt into and use different networks. He argues that the News Corporation entry is focused around “stuff” – deep common interests, particularly music, while Facebook focuses on people and connections between them. Even after you filter out his competitive need to differentiate mass from class, he might have a point. An Exact Target survey found that 63%of Facebook users connect with old friends, 59% use it to maintain personal contacts and 37% use it to stay on top of their social lives. Twitter, with 29 million active users each month, is about instant news and quick reactions to news or pop culture developments. LinkedIn focuses on professional connections. Quantcast says the network has “affluent, ambitions and influential professionals” which is borne out by the fact that 38% earn $100K or more, 75% hold college or graduate degrees and 71% are older than 35. Many people try to separate professional contacts on LinkedIn from personal contacts on other networks. Yet Facebook Connect’s API and the easy ability to automatically share posts among networks will make this less likely over time, especially since individuals are now spending an average of 6 hours per week managing their social connections and interactions. The move to differentiate networks is even more critical for the second tier networks like Hi5, Tagged, Bebo, Plaxo, MyYearbook, BlackPlanet or Yelp. Their continued existence, with much lower numbers of users and traffic depends entirely on their ability to identify, quantify and monetize their membership rolls. The growth of gated communities, like SERMO for doctors, aimed strictly at professionals who demand verifiable credentials for admission is evidence of the growing demand for differentiated and serious communities addressing specific topics. And while much of social media is like talk radio, where few participate and many listen-in, increasingly people want filters to separate the things that matter to them and the things they care about from the mass of blab and trivia on social networks. There is an argument for creating distinct communications strategies and messages aimed at specific social networks. Maybe you shouldn’t use the same message or the same offer in your 140 character tweet, your posting to your Facebook brand page and the video you upload to YouTube? At present the attitude, voice, tone, manner, language and offers are subject to testing and learning. Drilling Down. Social networks are millions of personal networks. Understanding and documenting who is in these sub-networks is the next step in refining these communities as marketing platforms. If the typical Facebook user has 130 friends (according to Altimeter) are the individual sub-networks homogenous? Can they be easily sorted and tagged? If the typical user is like me, the answer is … no. I have friends on Facebook from elementary and high school, college, camps, Boy Scouts, past and current jobs, summer travel, family members ranging from elderly aunts to 12-year old nephews, neighbors, people who share one or more of my interests, book club members, choristers, poker players and friends of friends. My friends are not a psycho-demographic mirror of me. They may or may not be open to pass along messages although a decent number (4%) voted for my SXSW proposal. My potential as a 130+1 sub-network, from a viral marketing perspective is not a sure thing. That’s why Google and MSN are introducing ways for me to sort and tag my network for them. The race is one to get me to designate someone as a BFF or assign names to my Gmail Priority Inbox. In doing so, I am doing part of the database build for the networks. If they can get me to finger my poker buddies, the networks can better merchandise my node. Identifying Influencers. There is a major move on to identify influencers; those individuals who have the respect and authority among peers and...
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Sales Funnel Dies The sales funnel, the oldest, most illustrated and beloved marketing paradigm passed away today of old age. Originally, constructed to approximate the rational buying sequence for B2C and B2B customers, the Funnel leaves no immediate heirs. Shopping was never really linear. Prospects take multi-directional, multi-dimensional and idiosyncratic paths to surface needs, identify buying criteria, list potential solutions and fall in love and purchase. Easy digital access to product information, testimonials, video demonstrations, user-generated or professional reviews, peer opinions and comparative pricing tools creates a more dynamic, unpredictable and emotional landscape than the Funnel ever portrayed. The implications for marketers and merchants are that marketing strategy, messaging and media must shift. The number of inflection points has multiplied. Rather than aim messages or media units at a particular point in a reasonably predictable cycle, marketers now have to array their brands in ways to cover a much larger, expanding and morphing digital Main Street or mall and interact rather than interrupt. A shift in consumer behavior to digital channels was documented in a recent study of more than 2000 US shoppers, titled “2010 New Shopper Journeys Survey,” conducted by Carat and Microsoft Advertising The two big take-aways are 1. Brands have to engage customers across 3 or more screens. During a buying cycle and use each channel and each digital meme to its best advantage. Brands will meet customers in several settings during the purchase time frame so that specific aspects of the brand story and value proposition can be parsed through specific digital assets. 2. It’s Not Over with a Purchase. Customers almost instinctively use digital and social media to share and validate their purchases, review and recommend products, comment on customer service and plan subsequent shopping expeditions. In the survey, 48% of responders recommended a brand by name and 30% recommended a retailer. And while this fundamental behavior has always been true, technology accelerates the speed and scale to increase the impact on future sales. The Funnel is dead. Customer behavior is in-flux. The search for a new paradigm has begun.

Danny Flamberg

I am a veteran marketing consultant working with leading and emerging brands

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