Category: Measurement and value

We need to talk about content marketing

talkaboutkevinFINALContent marketing.  Now here is a trending thing.  Of course, from the earliest of days, content has been one of the primary areas of focus within the social media space, but it feels as though this thing ‘content marketing’ is now reaching some sort of critical attention mass.

A few years back everyone needed something which could be called a social media strategy – mostly just so they could say they had one.  You didn’t really need to understand it, you didn’t really even need to implement it, far less measure the value it created – still don’t one might say – you just needed to have one (preferably with a Twitter account and Facebook page tacked onto it) for when you got asked the question.  So it is now with a content marketing strategy.  I suspect that few marketing folk will be able to make it through 2014 with their credibility intact, if they are unable to hold aloft a content marketing strategy.

But here is the thing.  What exactly is content marketing and what is a content marketing strategy?  Also – how does it map against this thing called native advertising (or is native advertising just an ad person’s attempt to try and appropriate a trend which is currently playing more to the strengths of PR and journalistic, rather than advertising, types?)  Actually, I think we can answer that last question easily.  Native advertising is just an ad person’s attempt to appropriate a trend which naturally plays more to the strengths of PR and journalism, rather than advertising. End of story (and hopefully end of talk of native advertising).

Content: what content?

Of late, I have become a skeptic of the term content, especially this thing called ‘engaging content’.  It wasn’t always so.  In some of the first presentations I gave on social media some six or seven years ago I can remember my mantra was “get it a link, get it out there and get it working for you” – albeit the intent here was to try and get organisations to understand that content shouldn’t be highly produced and live on websites – it should be very low cost, produced in volume, launched from content hubs and live ‘out there’ in social (Google) space.  Conversation, Content and Community were what I preached as being the Holy Trinity of social media.  Continue reading

Social media and the big scale question

Scale is a very important concept in social media and I think there are three reasons for this.

  1. We are all inclined to define the value of scale in terms of reach and frequency, because this is how we defined value in traditional media.  However, social media doesn’t deliver reach or frequency very effectively.
  2. There is the question of scale as a unit of measurement of this thing we call engagement.  The problem is that almost any form of traditional, marketing activity can never register at the social end of the engagement scale.
  3. The social media revolution leaches scale from the business models of every industry it touches and completely changes the scale dynamics (in essence, big stops being beautiful – certainly in a marketing or product design context) – and this is the main long-term challenge all businesses need to address.

Scale is not achieved through reach and frequency

Measurement and metrics in traditional marketing were all about reach and frequency.  This was because marketing was defined as a channel and message challenge and the channels were expensive – thus requiring that they ‘reach’ a large number of people to make them cost-effective to use.  Thus media came with an audience already built into it, and that is effectively what we were buying when we bought, or gained access to, media – we were acquiring scale.  A great deal of time and effort was spent devising creative messages (content) and campaigns and we gave these scale by putting them into media channels.

Social media doesn’t have scale built into it: it doesn’t come with an audience attached.  Continue reading

The EACA Euro Effies: the marketing equivalent of You’ve Been Framed?

A couple of weeks back I got the opportunity to attend the awards ceremony for the EACA Euro Effies.  These are essentially advertising awards (or more precisely awards for advertising agencies) that are not judged by creatives for their creativity, but judged according to how effective they are in meeting the clients’ business objectives.  (Should there actually be any other types of awards I ask?).  The interesting thing was how little actual advertising featured in many of the winning entries.  It reminded me of the sage words of Lou Capozzi , former boss of the MS&L PR network, who – on looking at the changing marcoms landscape – declared  “it is all just become PR with zeros added to the budget.”

Even those winners that were more ad-focused had submissions that were surrounded by a blizzard of ‘social media engagement’ and some of the more memorable appeared to be almost entirely social media-based, with no actual ad either produced or deemed worthy of featuring in the case study presentation of ‘the work’.  Examples here included a campaign for Mercedes-Benz about an invisible car, a stunt recreation of Felix Baumgartner’s famous Red Bull jump in Lego and a campaign to get people to visit Iceland in the winter based around an invitation to visit ordinary Icelanders in the homes.

I found all of this quite confronting, not least because I spend all my time telling people to forget the idea of using social media to reach audiences – pumping out lots of content – yet here were examples of just that, which were winning awards for effectiveness.   Continue reading

The latest croissant of absurdity from the SocialBakers

Every month I receive an email from measurement / metrics company SocialBakers alerting me to the latest  league table of performance for UK Facebook pages.  I usually avoid opening this email because it depresses me, perpetuating as it does, the view that Facebook activity and social media in general is a numbers game that is all about creating the maximum number of fans and this thing called engagement.  However, this month I took a look, just to see if things were changing.  They were not.  The part of the report that always depresses me the most, remained depressing.  I have shown it below. Continue reading

Social media: why P&G, Coca-Cola and Facebook might have got it wrong

Book cover 6x4Is it possible that organisations such as Procter & Gamble and Coca-Cola (and even Facebook) are headed in the wrong direction when it comes to working out social media?  Instead, could the very fact that such organisations are so accomplished in the practices of traditional marketing, mean that they are inhibited from developing an effective response in this new social media space?  Could it be that this new space is not really a media space at all?  Could it be that the idea of ‘reaching out’ and creating ‘engagement’ with consumers is a total waste of money and that value in the social digital space is created in an altogether different way?

These ideas and many others are explored in an e.book I have just published called ‘Social Media and The Three Per Cent Rule: how to succeed by not talking to 97 per cent of your audience‘.  Central to the book is the idea that traditional marketing is an activity designed for audiences because the media it has always worked with is an audience-based media.  The reason media is audience-based (mass media) is because it is expensive.  Social media is free.  It has liberated information (content) from an expensive means of distribution and this has also liberated marketing from the need to talk to audiences.  In fact it has created a requirement for all organisations to understand how to create cost effective relationships by talking to individuals or small groups.  However, very few organisations have grasped this, preferring to see the challenge as that of building audiences within the social digital space, so that audience-based approaches can continue to work.  This is because they have become wedded to audience-based relationships and are supported in this marriage by an entire industry which therefore has an interest it wants to preserve.

There are now two worlds: the world of the audience and the world of the individual.  One world is not going to replace the other; rather organisations have to work out how to operate in both worlds at the same time, because consumers, customers and citizens have no problem doing this.  And organisations cannot operate in the world of the individual by treating individuals as very small audiences, serving them up a diet of ‘engaging content’ or any other activity that comes from the world of mass marketing and communications.

The world of the individual is a very different space.  It is a world where people put trust in transparent processes more than they trust opaque institutions (including brands) and trust individuals with strange pseudonyms more than they trust their own friends.    It is a world where ideas benefit from the oxygen of probability, rather than the oxygen of publicity.  It is also a world where the belief that a platform such as Facebook can be worth $80 billion is not sustainable in the long-term.

Despite its strangeness, this is not a world which it is difficult to operate within, as I hope I spell out in the book. But it does involve letting go of comfortably familiar approaches and embracing new ideas: something many organisations and institutions (the big ones especially) are often reluctant to do.

Eurostar: good traditional customer service, poor social customer service

FailureI use Eurostar in many of my social media training sessions and presentations as an example of an organisation that (still) hasn’t really got social media.  The reason for this is that while their traditional customer care may be quite good, it hasn’t yet worked out how to do real-time customer care, using social media.

I use a couple of examples: one is an instance of lack of response to some rather poor food I was once served (see this post) and the other is in relation to a horrible delay I experienced nearly a year ago.  The issue, in both cases, is that fact that Eurostar are not doing the number one thing any organisation needs to do first in social media: listening to their customers and responding in real time. Continue reading

Just answer the ****** question!

Just listen and answer theHere is a short thought for a Friday.

The first and absolutely most important thing you should do in social media is listen to your consumers / customers and answer their questions.

I say this many times in the training I deliver and posts I produce – but I thought it was a good idea to Just Say It on its own.

You should work out how to do this before you figure out how to drive ‘likes’ on Facebook, what content to produce or how to measure engagement.  Because if you do this, consumers will ‘like’ the brand, rather than just the Facebook page.  And also, if you do this, you will find that you magically have the answers to what content you need to produce and what you should be measuring.

Furthermore, if you simply listen to you customers or consumers and answer their questions, you will have a social media strategy that is far more effective than almost all of the strategies employed by most of the brands in the world at the moment.  Social media is a listening and response tool.  It is not a publication tool.

Just because something works doesn’t mean that it is working

FireShot Screen Capture #105 - 'November Facebook Data for United Kingdom - stacynet@googlemail_com - Gmail' - mail_google_com_mail_u_0__shva=1#inbox_13b8e711e6d7883eYesterday I got an email from a chap called Darren Reed at Socialbakers (see above).  I say I got an email from him, but in reality got an email from b2b-mail.net because I ended up on an list on account of having commented on piece on Socialbakers’ blog.  I don’t think Darren actually sent it.  Anyway this ‘slightly spam’ email drew my attention to Socialbakers’ latest Facebook Report for the UK recognising the ‘best performing brands on Facebook’ – whatever that means.

As it turns out, this means the brands which have created the most engaging posts, according to the measurements provided by Socialbakers.  Thus I was able to see that the top three most engaging posts in the UK in November were:

  • Coming in at number three, was Appliances Online with “Click LIKE and you could WIN a £500 Electrolux Oven/Cooker.”
  • In the runner up spot was Asda with “Click “like” if you’d love to win £100 to buy your Christmas turkey and all the trimmings!”
  • And the winner, and best performing Facebook post in the UK in November was (insert drum role here) Appliances Online again with “Click LIKE if you fancy WINNING 3 Samsung smart appliances (Worth £2,500).”

One can see a theme emerging.  Indeed it is a theme that anyone who studies Facebook will be be familiar with – namely that the main reason consumers ‘like’ brands is to get offers, freebies or enter competitions.

I was pleased to receive this information because I was able to insert it into a presentation I was about to give to a bunch of marketing folk at Bilgi University in Istanbul in order to illustrate a point I was making in relation to understanding how to use Facebook.  This point was that “just because something works doesn’t mean that it is working” – as in just because competitions are effective in Facebook does not mean that the most effective way of using Facebook is competitions.  In fact there is almost nothing to be learned from the sort of data that Socialbakers et al may give us about effective postings or content in Facebook that will help us determine how to use Facebook effectively for the very simple reason that Facebook (indeed almost all forms of social media) are extraordinarily ineffective tools to use to put content in front of lots of people.  Social media does not ‘do’ large numbers it ‘does’ small groups.  Social media does not have scale built into it, in the way that traditional media does.  The benefit you get from social media therefore does not lie in the numbers, the ability to ‘engage’ a lot of people, the benefit lies in in the ability to create relationships with very small groups of individuals, at any one moment in time.  Critically, therefore, these contacts have to deliver something of significant value – i.e. hugely greater value than that associated with the sort of metrics that Socialbakers are measuring (likes, shares, comments etc) in order for the effort to be worthwhile.

I was using this point to illustrate the main theme of my presentation – namely that we now have two worlds: the world of the audience and the world of the individual (I thought this was a rather neat theme to use given that we were standing is a city that has been defined by the fact that is sits at the physical and political junction between two worlds – the world of Europe and the world of Asia).  Up until this point there has only ever been a world of the audience and as a result, most brands are simply trying to push approaches designed to be seen by audiences (i.e. lots of people) in front of individuals or groups.  And, of course, this doesn’t work.  As Hugh MacLeod memorably stated “If you talked to people the way advertising talked to people, they would punch you in the face”.  This doesn’t mean that advertising doesn’t work, it means that advertising needs an audience in order to make it work, or as I, rather more charitably put it, “The great thing about advertising is that no-one take it personally”.

The value of Facebook, and all of social media, lies in the ability for your consumers to tell you what they think of your brand and, potentially, to help you improve what it is your brand does.  Pushing ‘engaging content’ out through Facebook is a total waste of time – consumers don’t want engaging content, they simply want a brand to be listening to them and answering their questions.  Now if you can do this at scale in a platform neutral way (i.e. listening to consumers wherever they want to talk to you – blogs, Twitter, Facebook, forums etc.)  you will be creating something of value – albeit Socialbakers won’t be able to measure it.  In reality, as I have said before, you don’t need to attach metrics to Facebook, Facebook itself is metric – it measures what people think about your brand.

Anyway – I will send this post to Darren.  I am sure he won’t mind given the liberty he feels he has to send stuff to me.  Let’s see how (or if) he responds.

As an interesting footnote, a few weeks ago I was running a session with a group of post-graduate students at the European Communications School in the London College of Communication.  Of the 30 or so members of the group only one used Facebook to have any sort of relationship with brands.  A handful said they occasionally ‘like’ brands, but only to get access to offers and the rest said they only use Facebook to stay in contact with their friends.  Is anyone surprised about this and if you are not, why do we then think Facebook is some sort of magic platform to ‘reach out to’ or ‘engage’  a significant number of consumers?

We also then went on to do some basic brand mapping work in order to identify what sort of relationship people had with ‘the thing’ that is Facebook.  What this showed is that people see Facebook as a utility.  It ranks somewhere slightly above the relationship they have with a mobile phone network and a long way below the engagement they have with services like Google or products such as Apple.  So, remind me again, why is it that Facebook is trading at an earnings multiple about four times greater than that of either Google or Apple?  Maybe it is because marketing directors are being encouraged in the deluded belief that Facebook is some form of media platform that allows them to reach lots of people, rather than a tool that lots of people can use to reach brands often with content and requests that brands are unprepared to respond to (a tool for which, incidentally, consumers will not be prepared to pay – as my research with the students also confirmed).

Silly debate about Facebook metrics (because Facebook IS the metric)

The changes to Facebook’s Edgerank algorithm (which is the algorithm Facebook uses to determine what information you see in your news feed)  have been creating some controversy, not least because it has affected the ‘reach’ of many organisations’ Facebook pages and raised suggestions that this may be linked to Facebook’s desire to encourage page owners to pay for their reach, via prompted posts (see this post from AllFacebook).

However, the underlying, and unquestioned assumption behind all this discussion is that ‘reach’ and ‘engagement’ are the metrics we should be using to measure corporate usage of Facebook.  Why this assumption?  These metrics come straight out of the world of traditional media where the role of media was as a channel to reach consumers.  But social media doesn’t work this way.  Social media does not have scale built into it in the way that traditional media does.  Social media is not designed as a tool to reach lots of people, it is designed to allow small groups of people to connect with each other.  Creating an approach that is designed to try and add scale to a social media presence, to chase numbers in terms of reach or engagement, is a waste of time.  It is completely the wrong approach (and metric) to use.

Facebook, and all other forms of social media, are tools that enable consumers to reach brands (if and when they want to).  The only part of any Facebook page that has any relevance is the ‘Posts by others’ space and it is not the quantity of posting here that matters, but what the posts are about and how (or even if) the brand responds to them.  Since these posts are often negative, or complaints, in reality the objective for most brands should be to minimise their Facebook ‘engagement’ – which of course you achieve, not by anything you do ‘in’ Facebook, but by how your brand behaves ‘in’ real life.

Social media is not a channel and message identification challenge (as traditional marketing is) – it is a behaviour identification and response challenge and the metrics we use should reflect this.  In fact, Facebook itself  is the metric for brand behaviour, rather than something you should attached metrics to.

Why Facebook is worth only $5.6 billion

Given today is Facebook listing day I figured I had to add my pennyworth (again) to the whole “is it worth it” debate.  I reckon the true value of Facebook is something in the order of $5.6 billion.  Here is how I derive that figure.

First I take a stab at guessing what it costs to deliver A Facebook (i.e. the service that Facebook delivers to its users, rather than the service it delivers to advertisers).  I reckon this is around £300 million.  It is the costs for the server space and the techy maintenance.  Now I know Facebook states it has much higher costs than this, but these are the costs associated within maintaining a business model that it needs to sustain a valuation of $100 billion – not the costs associated with delivering the service to its users.

Then I add a respectable margin to that figure (say 25%).  That gives me revenue of $375 million.  Then put a 15x multiple on that and you get $5.6 billion.

Now, Facebook is already generating much more revenue than the $375 million I think it should be earning.  So my figures are already wrong, right?  Well go back to basic economics.  In the long-term in functioning competitive markets, companies cannot generate significantly more for providing a service than it costs to deliver that service – because that simply creates a window for a competitor to come in at a lower price.  You can only break this rule by distorting the competitive framework in which you operate.  Facebook is currently operating in a distorted market because there isn’t a competitor and all the clever analysts haven’t yet actually worked out a realistic model for valuing something like Facebook – they all rely on a derivation of the old media platfrom model, forgeting that Facebook is not a media platform and its users are not an audience.  Facebook is actually an infrastructure – an infrastructure that cannot basically charge for the majority of the cost of that infrastructure because we already pay for it through what we pay to our internet service provider.

And as for competitors, they will come.  And their competitive edge will come from promising users that they won’t sell the users’ data.  And they will be able to do this, because they won’t need to sell the data, because they won’t need the revenue, because they won’t have to sustain a silly valuation.

Therefore, if you place a bet on Facebook at its current price, you are betting on Facebook’s ability to maintain a distorted market.   Long-term this is an absurdly risky proposition.

Long exposition on the value of Facebook and Google here.