PDF We have had a series of meetings that highlight the need for those of us in the industry to provide context as to where companies are in the social maturity curve. For companies that are on the cutting edge, this is an easy conversation as they are comfortable with ambiguity and the speed of change. For others, the experience is different. Through our conversations, we’ve identified the Three Stages of Social Maturity:
Archive for the ‘Social Media’ category
SEC Social Business Framework
October 21st, 2010Beyond social media and marketing, Social Business is really about internal and external customer experience –a cross-functional responsibility of the entire organization. To help executives wrap their arms around the key pieces that can be augmented through social efforts, the Social Executive Council (SEC) created the Social Business Framework. This framework is designed to help organizations understand how to align, manage, and bring cohesion to business objectives, company activities, and social solutions. In essence, this framework “operationalizes” social business in a manner that modularizes its components into company-relevant pieces that can then be utilized to build a social roadmap of strategic and tactical steps that facilitate implementation.
This framework also helps executives visually understand the complexities associated with a successful social program, as well as gain clarity on the:
- Multidimensional benefits of an enterprise-wide social enablement program.
- The structured business gains when implementing a social communication layer that allows free flow of ideas and reporting.
- Limiting results gained when assigning social activities to one silo-ed department and/or junior marketing/public relations associate.
- Opportunity costs of not participating in this program from a financial, efficiency and productivity perspective.
The SEC is an active forum for senior executives to collaborate and adapt the Social Business Framework to their own organization. The impact is too large and too overwhelming to do it alone —the SEC and this framework are here to facilitate the process and help our members gain social market leadership.
Social Market Research Will Save Marketing
October 15th, 2010Even as I write the title, I cringe. As I am a late convert to the value of formalized market research. I still have flashbacks of my market research class in grad school. All I remember is statistics, database, demographics, statistics, blah, blah, blah… all I retained is that mean and medium are somehow different and important. I got lucky in that my immediate neighbor in the first class was an actuary so when they formed teams, he became my best friend.
As I progressed in Sales and Marketing management, I realized the value of asking customers what they really wanted and how they felt. I also realized there are limitations in that process. Not that customers lie, but I can’t always tell you why I do something instinctively. I just do. In asking me to explain, you may or may not get to the heart of “why.” Also, depending on “when” you ask me my opinion will vary greatly.
That is why good market research leverages statistical sampling to make sure the sample size is large enough to represent a target population. We use sampling techniques because the population is too large to cost effectively poll or they are too difficult to get all of the responses.
Shocker Statement: Traditional Market Research has a Fundamental Problem
If you know anything about political polling, they have lots of discussions about the difference between likely voters and registered voters, etc. They also beat each other up about polling techniques; whether it was phone based, did they include cell phones, the average age of the respondent, etc. What they really are trying to do is correct for the impact that the process of polling has on the outcomes. Minor differences can radically shift the results of the poll.
Corporate market research has the same challenges. Not that they don’t account for much of it, the state of the art is pretty sophisticated and gotten much more so with algorithms, etc. What the challenge for corporate marketers is always who constitutes “likely buyers” versus potential buyers. If I poll based on demographics, I can’t really tell who is likely to be a potential buyer. On websites, they spend a lot of money on predictive algorithms and website “cookie crumb trails” to try and predict potential buying behaviors.
But the challenge in primary market research is that it is an approximation of the market. A sampling set if you will. The challenge that I contend is that we sample the wrong sets in market research.
Ok, before I get lynched by a bunch of analytics, let me explain. We have been doing social market research over the last year. We probably surveyed the landscapes of 60+ markets — probably 100+ sub-markets. Everyone of them is showing a difference in the way buyers are approaching markets versus sellers. Not talking subtleties, but in most cases, the majority missed the mark —buyers are talking over social media at a 10:1 clip versus vendors. AND they are using completely different language. Vendors are focused on the “solution stack” -– features, functionality, benefits. Buyers are focused on pain, experience, exploration, decision support, value, etc.
What it is telling us in aggregate is that vendors are only focusing on a subset of the market; those who understand the industry jargon. The vast majority of buying markets are not being serviced with the right information. I would guess somewhere about 80% of buyers or potential buyers don’t know what they don’t know and therefore cannot perform structured searches or clarify their buying interest to market researchers.
I also think this is why major brands are shifting much of their new product innovation to social media and online communities. P&G has dictated something like 50% of their new product innovation will come from its customer community. Staggering, but also a recognition that the traditional market research approach cannot get to those who don’t self identify as being part of the market.
10 Really Cool Insights from Social Market Research
- Disconnect between buyers and sellers in markets
- Difference in buyer types leads to different online buying processes
- Most buying processes now intersects online and goes non-linear via social media at some point; research, validation, comparison, transaction, etc.
- Sellers are still trying to push a linear buying process that they think they can actually influence
- Estimated 80% of potential buyers don’t know that they are in the market and are engaging outside of the vendor communities traditional venues.
- We can see language differences in different types of buyers and vendors
- We are using this analysis to segment and target specific types of potential buyers who would not normally consider themselves as active in the market.
- Good social market research allows organizations to identify gaps in their approach to the market, focus on the psychographic buyer behavior, and eliminate the high-cost/low return marketing expenditures that they have had to cling to because they produced critical volumes of sales albeit at higher cost of acquisition.
- Customer experiences for good or bad are now bleeding into the non-linear buying processes. Vendors who don’t get control of their poor experiences will experience a different kind of bleeding; profits.
- We haven’t even touched the tip of the iceberg as the semantic analytics and market research techniques get updated.
Today Social Market Research is largely a blend of qualitative sampling and quantitative support. Just because you can measure it doesn’t mean you can derive meaningful business impact from it. The qualitative analysis allows us to overcome the challenges with the state of the social media tools. We can sometimes use up to 16 different tools for just one function. It isn’t about clicking a button and “poof” you have your answer to grow market share overnight. Also, having your own community allows you dimensionality of insight versus just polling public social network sites. Add in structured customer data and you have the backbone for some amazing buying behavior analysis. Over the next couple of years, the semi-automated process will mature and give way to more automated, trending, and analytical driven systems that integrated with the current business intelligence systems.
For us today, Social Market Research is the first step in building a social business plan. Not just for marketing, but all of the customer facing touch points and all of the customer support functions. In short, pretty much all of the business. You don’t know what you don’t know.
The challenge is can you figure it out before your competitors do.
Is Your Business Over-Automated?
October 6th, 2010I have never heard anyone tell me that a business is over-automated, but I think it should be a term and concept that should enter into the business lexicon ASAP. I would define over-automation as the mechanical, impersonal, and crappy customer experience that I get when I have to engage with a large enterprise with lots of customers and too many bright people thinking about the bottom line.
I will pick on Blockbuster for a minute. Blockbuster, in its heyday, was a powerhouse in the movie business that is, as of this week, in bankruptcy. As a customer, you could tell that the company designed their customer experiences to maximize profitability; hence the late fee model that made more money than the original rental fees.
On paper, this is a great idea. In execution, it pissed off a lot of customers and, I would contend, led to the gap in trust that opened the door for Netflix. I really like the visceral experience of browsing isles looking at the sea of titles and seeing which one stands out. I like doing the same in bookstores. Online doesn
Is Your Best Customer an Educated Customer?
August 18th, 2010Seemingly simple question, but one with huge implications in a socially-transparent world. I have worked for some folks over the years who were “nice guys” until they got in a room with a potential customer and turned into sharks. Their belief was that they needed to close the customer as soon as possible and with as much margin as possible.
Forget value-based pricing, it was “Caveat Emptor” or buyer-beware pricing. Their best customer was an uneducated client who didn’t understand the value of the offering. They preyed off of the buyers ignorance.
As any of us who run businesses know, it is a struggle to find the right balance between customer and company needs in a relationship. Customers do not really appreciate martyrdom when you cannot deliver at a ludicrously low price. Some buyers look for predatory deals on their own side as well. At the end of the day, win-lose negotiating means someone loses.
I have always believed in win-win relationships with customers. My belief is that you operate as if the client has all of the available information and you treat them respectfully as an educated buyer with all of the benefits in the negotiation and represent their interests even if they cannot. Integrity is not bought or sold, it is earned. Sometimes at great cost and sacrifice. And it is always constantly challenged.
I have also always believed that you can “win” with integrity and that eventually those who practice predatory business practices will be exposed.
Social media has the opportunity to profoundly impact market transparency. My sincere hope is that it will be easier for buyers to get a more “accurate” picture of the value of the offering and the integrity of the provider. Markets become more efficient with better information so I believe that the ability to check references, get self-educated, and validate product claims will make markets more efficient and reduce the ability for “bad actors” to operate.
I think those who believe in “an educated buyer” are already participating in social media for the right reasons. The “give to get” model of providing thought leadership and market education has helped many. Not sure yet that it is affecting market behavior on a macro-level, but I am always hopeful.
