Facebook Timeline and the election of Vladimir Putin: what they share in common

The answer is that they both mark an end to a period of managed democracy.

Putin first.  We may not especially like Vladimir Putin’s approach to democracy – managed democracy as he puts it.  However, the era of managed democracy has none-the-less brought significant benefits.  Almost everyone in Russia is materially better-off, a middle class has emerged, free-market corporate anarchy has been brought under control and the power of the oligarchs has been dissipated.  Things have got so much better in fact that this emergent middle class has stopped worrying about putting food on the table and can now start to worry about putting democracy on the table.

It is assumed that Putin is wise to this.  He has ‘got the message’ via the recent protests and knows that having secured 6 more years, it is now in everyone’s interests to now manage a process towards more genuine democracy (rather than seeking to manage democracy itself).  And is also assumed that he is cool with this because, literally or figuratively speaking, he has made his pile.  We could of course be wrong – in which case we will still see the end of managed democracy, but with a return to authoritarianism.

Which brings us very neatly to Facebook.  The Facebook world to this point has been a form of managed democracy.  While Facebook is democratic in that it is open to anyone to participate within it, the rules are managed from HQ, to an increasing extent in a manner designed explicitly to advance the interests of the owners.  But we, the users, have been content with this, because we have all benefited from being introduced to the new form of behaviour that Facebook represents.  We have also been kept content because the internal operations of Facebook have not been transparent in much the same way that Putin has maintained a veil of opacity around his own activities.

But here is the change that signals an end to that era.  Facebook Timeline is an initiative that has been designed explicitly to benefit the interests of the current and future owners of Facebook rather than an initiative informed by the way users wish to use the platform.  Users are being forced (for we can’t opt-out of Timeline) to change their behaviour in order to generate much greater volumes of data about their lives.  The benefit to them of doing this is debatable.  The value of them doing this, for Facebook, is considerable.  Facebook is seeking to shape and control the will of the people in order to support a ruling elite.  It is becoming authoritarian.

Much has been made of the fact that, with 800 million users, if Facebook were a country it would be the third largest in the world.  Some truths lie in this analogy, beyond simple indicators of scale.  Facebook users are not simply consumers or an audience, they are much better understood as citizens of Facebook.  And if you put the interests of a controlling elite ahead of the interests of your citizens without delivering to your citizens a significant compensating benefit, you will ultimately end up in trouble.  Putin, we believe, has learned this lesson.  Has Facebook?

 

Read Jeff Jarvis’s Kindle Single, Gutenberg the Geek

I would strongly recommend reading ‘Gutenberg the Geek’, a Kindle Single published a couple of days ago by Jeff Jarvis.  He makes the critical connection between what happened around the invention of the printing press and what is happening in the social media revolution.  He views this both through the similarities between Gutenberg’s life and experiences and those of the likes of Steve Jobs, but also the similarly revolutionary effects caused by both the introduction of print technology and social technology and the fact that we can now see ourselves as passing through the end of the Gutenberg era.

Having been banging on for years  about the importance of understanding Gutenberg in relation to social media – frequently to blank looks from marketing folk – the fact that Jeff Jarvis is now on the case makes me feel much comforted.

The Sunday Sun: why it shows that the future of newspapers is more about paper than it is about news

The new Sun on Sunday has come under a lot of flack.  It has been criticised for the lack of investigative news reporting its deceased sibling, the News of the World, featured (albeit what  the NOTW investigated and how they did this was open to question).  People are saying it is more like a magazine than a newspaper.  I think this criticism is misplaced.  The Sun on Sunday is an illustration of the future of newspapers: i.e. the separation of news from the distribution mechanism that is newsprint (in line with fundamental trend inherent in the social media revolution, which is the separation of content from its means of distribution).

All newspapers face a fundamental and painful choice: they either stick with the news (content) which means they will have to separate themselves from the distribution mechanism of newsprint, or else they stick with printed paper and change the content to that which is better adapted to work in this distribution medium.  And magazine type content is better adapted to print than is news. The problem for the Sunday Sun is that magazines are better adapted to be …err… magazines, than tabloid newsprint.

 

Unilever’s ‘earned impressions’ – how can an impression be social?

Yesterday I finally got round to publishing a long treatise analysing what type of content and engagement works in social media.  Its central point was that most brands end up either ‘doing anti-social’ in front of lots of people with minimal guarantees of success, or else they ‘do social’ in front of small groups of people in a way which doesn’t scale or create any other form of commercial benefit.  I focused on two examples from P&G to illustrate this.

Co-incidentally, the same day Ad Age published this overview of the social / digital strategy of Unilever –  P&G’s greatest rival.  It quotes Babs Rangaiah, Unilever’s digital and media guru as saying, “To get earned media, you need to create great assets in the digital space. The idea is that by creating great earned impressions, you can take from the paid impressions”.

‘Great assets’ – isn’t that just another way of defining one-to-many mass content?  ‘Earned media and impressions’ – how can an impression be social?  To me an earned impression seems like just another definition of viral.

Adapting to social media isn’t about effecting a shift from owned media to earned media, in fact I think earned media is meaningless term.  It is a word like horseless carriage – a term that borrows from the past to label something we don’t yet understand well enough to describe correctly.   The media remains owned, it is just a question of who owns it.  It used to be owned by brands and media institutions, now it is owned by consumers and customers.  It is about a shift from controlled media into participatory media.

Perhaps Unilever’s strategy will function as an effective digital upgrade – but, on first inspection, it doesn’t appear to be a strategy likely to access the real benefits and opportunities available in the social digital space.

Content: what content?

(This is a rather long post, so you can download it as a pdf to read in bed or in the bath.  If you stick with it I hope it will change the way you think about social media).

People are talking a lot about Engagement and Content at the moment.  These concepts are up there on the pedestal as examples of what you need to do when you are ‘doing’ social media.  “Content marketing is the new … err … marketing” people are saying.  And “we must use social channels to drive greater engagement with our consumers”. However, the real question is “what type of engagement and what type of content?”  A piece of content can be anything from a tweet, to an expensive piece of video – which makes generic exhortations about the importance of content largely meaningless until such time as we drill down an define exactly what type of content we are talking about.

Likewise with engagement.  At best this is a very hazy term.  It is a bit like the term Reform, something that inherently seems like a good thing, even if we don’t understand what it means, something which politicians are highly adept at exploiting.

So, of late, I have been on a mission to really get under the skin of Content and Engagement in relation to social media, because I have a suspicion that no-one really knows what they are talking about when they use these terms.

First the theory: it’s a bit bot boring, but it is very important.  Until the advent of social media, distributing information (media) was expensive.  This had two implications for anyone who wanted to spread information.  First, you had to keep the message short and snappy.  Second, you needed to get that message in front of all of the people you wanted to reach.  Your ability to tailor or segment a message was pretty restricted because it was either still quite expensive to reach a tailored group, or because the media or channels just didn’t exist to service small groups of people.  This conditioned the way in which we did marketing.  It was a reductive process – reduce your brand down to narrow proposition.  And it was a mass process – you needed to get the proposition (ad, key message, campaign) in front of lot of people, often repeatedly.

Then social media came along.  All of a sudden, distributing information became virtually free.  Therefore the problem that all of marketing had adapted itself to deal with, stopped being a problem.  And now that information was no longer locked-up in, and conditioned by, specific distribution channels – content could basically kiss media (distribution) goodbye.

The relevance of all of this is the critically important recognition that everything we have done in marketing and communications up until this point, has been adapted to a set of conditions that no longer exist, when you are in the social media space.  It is therefore reasonable to assume that, when you go into the social media space, if you are still doing what you used to do when you were in the traditional media space, it probably won’t work (or work very well).  It is a bit like the travelling across the land and the sea.  It is perfectly possible to travel across both, provided you understand the different.  Take a car into the ocean and no matter how well you may try and adapt it, it’s not going to work anywhere near as well as a boat.  Likewise, you can’t take a boat to the supermarket.

The theory therefore tells us that the type of content that we have been doing up until now is probably the wrong type of content for social media.  It would likewise suggest that how we defined the concept of engagement in the one-to-many mass marketing world won’t be relevant in the social world.

But that’s just the theory.  What about the reality?

The best way to understand the reality is take the trouble to look at what is going on in social media – how The People (defined as consumers, citizens or customers) are actually using it.  When you do this, you recognise that something in the order of 99.99 per cent of everything that is happening in this space concerns individuals making connections with other individuals, frequently within spaces that can be seen as a form of small community.  These people often already know each other, or have will have some form of potential or actual close connection as a result of a shared interest.  The bit of social media that relates to organisations ‘reaching out’ to individuals, or individuals contacting organisations is the 0.01 per cent.  The interesting thing is how few organisations have actually taken the trouble to study this reality.  Thus rather than use social media in a way which reflects how The People are actually using it, they focus on the tiny bit that accords with how they would wish to use social media – the bit that looks like, or can be understood as, a traditional media channel.

As a result we see organisations, for example, trying to use Facebook pages as a form of website.  The logic goes something like this: “We don’t really understand how You People are using Facebook and can’t work out what, if any, role we might have in all of this.  However, we do understand websites, so if we can make Facebook work like a website, we can then understand it and make it work for us.  Hurrah! Job done! Tick box! Pay digital agency!”  It is a way of super-imposing a desired reality (desired by brands, agencies and Facebook) on top of an actual reality – i.e. in reality, it’s a fantasy.

What would you say to a media agency that drew-up a media plan that ignored 99.99 per cent of the available audience?  Social media, of course, is not really a form of media, it is better understood as an infrastructure, but the point still holds.  Why choose not to use the infrastructure in a way which reflects how the people we want to engage with are actually using the infrastructure?

The answer is that to do this is awkward and difficult.  It involves breaking down what we have done to date and reconstructing it in a different form.  It is uncomfortable and disruptive and no-one likes disruption.  We all desperately want social media to be a new space within which all the old techniques will still work, with minimal adjustment (“we used to run promotions via advertising, so now let’s runs them in Twitter!  Hurrah! Job done! etc”).  There are also plenty of organisations with a vested interest in maintaining the comfortable fantasy, not least amongst them Facebook, Twitter and Google themselves, because they can only monetise themselves as a form of media or content platform, not as a form of infrastructure. (This isn’t strictly true, since they can create a viable business model as an infrastructure, but this kind of a model cannot justify the sky-high valuations to which these businesses now have to aspire).

So, what is the relevance of this for content and engagement.  Let’s look at content first and examine how The People are ‘doing’ content, because logically, this should inform the content that organisations should produce.  The theory tells us that this content won’t look like the type of content we have been accustomed to produce, but what about the reality?  Well, the reality is that the most valuable piece of content in the world tells you how to donate a car in Dallas.  Or more precisely, this piece of content is what the world’s leading social content manufacturer, Demand Media, worked out would generate the most revenue via associated advertising back in October 2009 (as highlighted in this excellent Wired article).   This wasn’t something that Demand Media derived via a lengthy or complex piece of research, it just happened to be the piece of content that its algorithms defined as the most valuable at that particular time.  Today, the answer will be different.  Demand Media doesn’t have an agenda other than making money by producing content.  It doesn’t have any editorial or subject considerations, it simply has a set of algorithms which tell it which bits of content to make in order to garner the most associated advertising revenue. It is not a newspaper or TV station, its content doesn’t live in a place or on a site, it lives only in search.  But the content that it makes, therefore, is actually a very good indicator of what content is actually popular and actively circulating within the digital space.  And this content is simply the answers to questions, because this reflects what is really happening within social media.  People are asking each other questions: “how do I do this?”, “where do I get one of those?”, “what about this?”  These are very specific questions demanding very specific answers.  Critically, almost none of the content organisations are accustomed to producing is anywhere nearly relevant or specific enough to provide these answers, because, in accordance with the old rules of mass marketing, we produced single messages that were designed to be seen by lots of people at the same time.  We didn’t (couldn’t) produce highly tailored messages designed to be picked-up by very few people at any one time, albeit something which could attract a larger audience over an extended period of time.

Here is a practical illustration.  I have been doing some work with a large firm of lawyers.  Their digital approach to date had been, sensibly enough, aligned against a search strategy that assumed that people were looking for a large firm of reputable lawyers.  The problem, though, was that in the social space, no-one was asking this question.  There was no place where a conversation about the best large legal firms was actually happening.  But was happening was that people were asking questions about specific aspects of the law – either within defined communities or via Google.  Simply rocking-up to those places and trumpeting about what a great firm you were or what expertise you had, wasn’t going to work.  The only basis for establishing a credible presence in these spaces was by answering the questions people were asking.  Thus the strategy that we put in place was a process which allowed individual lawyers to start responding to these questions and, once you have created an answer to a popular question, you don’t need to keep repeating it, the answer becomes ‘socialised’ and thus remains current in all future conversations, even if the original creator is not actually present.

That is it really – content, in social media, has to be based around answering the questions people are asking.  It is no good rolling out swathes of traditional ‘look at me’ editorial, publishing huge amounts of stuff simply because you now can publish huge amounts of stuff.  We used to make 30 second ads.  Now we can make 30 minute ads, because the space we have is not limited by the need to rent an expensive distribution channel.  But that doesn’t mean we should make 30 minute ads – it would be better to make sixty 30 second answers.

It is strange how few organisations are taking the trouble to work out what questions people are asking for which their business can provide an answer.  Well, I guess it is not strange really, because this is not necessarily something we want to know about, either because providing the answers that are specific enough is not something we are set-up to do, or because the answers are not really sexy.  We would much prefer to continue to tell everyone how great we are, even if this is an answer to a question no-one ever asked.

This neatly takes us on to engagement.  I recently took a look at P&G’s UK and Ireland Facebook page for its Pampers brand.  Here it is.  It lands you on a custom built tab – i.e. a place which allows P&G to make the page look as much like a website, and as least like a Facebook page, as possible, except for the command to press the Like button, thus giving P&G a data capture opportunity.  I don’t support this approach, but let’s ignore that for the time being.  I then went to the more important place – the Wall.  (Update: this post was written pre the introduction of Facebook Timeline so the design is a little different now – however, the basic principle is the same).  This is important because the Wall allows you to get a sense of what is really happening around the page.  What was going on was quite interesting.  P&G were doing some bog-standard ‘Like harvesting’  – i.e. a post declaring “Click like if you would like an exclusive preview of something new and exciting from Pampers.” They were also doing other forms of data capture – running promotions to incentivise people to send them their email address.  But they were also doing stuff that was much more social.

  • Every Wednesday they convene a Pampers Coffee morning where people are encouraged to have a chat.  The last one of these gathered 108 comments or contributions.
  • They were hosting a webinar to discuss the issue of getting their baby a good night’s sleep.
  • They were also helping spread advice: “Hi everyone! Sarah, one of our mums, would like your advice.  Here 13 month LG screams really high pitched for no particular reason.  She wants to know how she can break this habit.  Has anyone else experienced this and what did you do?”  This gathered 63 responses.
  • They were also asking questions such as “What fun words does your LO ask or get mixed up can’t say properly?” (125 comments), or “What gets your baby excited?” (124 comments).

If you checked out Everyone’s posts, as distinct from the default Pampers’ posts, you could see that people were using the space as a place to ask each other questions – the issue of sleep again seemed to be the recurring theme.

All good stuff.  In many ways you could see this as text book usage of social media.  The brand was encouraging people to talk, it wasn’t pushing messages at them.  It was obeying the rules.  It was generating a good response – an average of 120+ responses on a post is pretty healthy.  It was perhaps being a little anti-social through its rather underhand data capture techniques and there is a possibility that the questions it was asking were linked to the nascent creation of future campaigns, either for Pampers or for other P&G brands.  But that is just a quibble really.

The big question though, the question that I suspect is increasingly going to be asked about social media, is So What?  How was all this engagement actually selling more Pampers?  While the levels of response Pampers was generating was quite large in a social context they were tiny in the context of the total number of actual or potential Pampers consumers.  There was also the question of relevance.  Most of the stuff they were talking about was of relevance to the ‘target audience’ as Pampers would define it, i.e. parents with babies.  But it wasn’t relevant to the product – i.e. nappies / diapers.  So both the quantity and quality of engagement they were generating was low.  For a nappy, manufacturer to host a conversation with a few hundred mothers about getting babies to sleep, isn’t going to move the needle on anything – because it is neither relevant nor achieving scale.  It was OK to do this sort of stuff, essentially sponsoring conversations, when you were doing it in a mass distribution environment where all your audience could see it.  But Facebook is not a mass distribution environment.  The fact that a conversation is happening in a social network doesn’t mean that any positive sentiment you are generating will magically spread throughout the network and thus reach a significant proportion of your target audience.  The very nature of social media, small groups of people connecting with each other, makes it a very difficult medium to use to spread messages to lots of people, unlike traditional media which was designed to do this in order to overcome the economics of expensive distribution.

There is an exception to this, of course, and that is the ability of social media to spread contagion.  It is a paradox really, that 99.99% of everything that happens in social media stays within the boundaries of small groups and conversations.  But very occasionally things can break out of these confines, and when they do, they can spread incredibly rapidly, at a scale and cost effectiveness far greater than could have been achieved with any traditional media network.  However, the fact that these viral effects appear to be relatively common should not fool us into believing that they are anything but highly exceptional.  The only reason they appear ubiquitous is because of the incredible explosion in the quantity of information that is now being produced.  Virals are a bit like successful rock bands: there appear to be a lot of them around, but for every one successful band there are thousands of wannabees who never make it.  None-the-less, despite the exceptional nature of contagious activity, it is tremendously seductive to brands.  There are two reasons for this.  First, there is an obvious appeal in generating what is seen as free media.  In the old world, we made an ad and then had to spend many times the cost of making that ad buying the media to distribute it.  Now, we can make something and it costs us nothing to distribute it.  This is the attraction that is cited by the likes of P&G when talking about their Old Spice campaign of 2010.  P&G sees this campaign as being a success because, for a relatively small additional outlay, it created 1.8 billion impressions.

The second, perhaps more important, reason that viral activity is seductive, is because of its’ comfortable familiarity.  In the old world, marketing was based around putting single things (campaigns, messages, ‘impressions’ as P&G put it) in front of lots of people.  Getting the numbers was critical to success.  In social media, you can’t get the numbers, except by becoming viral – hence the conclusion that viral is the way to go in social media.  It allows us to delay the recognition that the social digital space is very different and continue to persist with the same types of activities, thinking and behaviours we are familiar with from the world of traditional marketing.  The problem, of course, is that you can’t base a strategy on the quest for contagion, in the same way as it would be foolish to plan your life on the basis of becoming a successful rock musician.

The other problem with contagion is that it not necessarily social.  A while back I was asked to speak at a beauty and cosmetics conference and therefore did some research into examples of usage of social media in this sector.  Naturally, I looked into the assumed success of the P&G Old Spice campaign to try and understand how this was working and what benefit it was likely to bring to P&G.  The interesting thing that I uncovered was that, despite the fact that the stated aim of the campaign was to create conversation between men and women about male fragrance, a quick monitoring exercise revealed that none of this was happening.  The vast majority of the conversation was about the ad or activity associated with it, such as creating spoofs.  No-one was talking about the brand and the only way the brand had worked out to talk to consumers was by pretending to be the man in the ad.  It did this either directly – making more than a hundred video responses featuring Isaiah Mustafa standing in a bathroom – or via a Twitter and Facebook presence where ‘the brand’ assumed the voice and attitude of a cool, black, sports jock.   So, the brand got its ‘impressions’ and the conventional brand benefits likely to be associated with this, but didn’t create anything that could be seen as social or sustainable.  In fact, the pretence involved in hiding behind an advertising character could be seen as actively anti-social.  It was also unable to repeat the exercise – subsequent ads and builds on the campaign have all basically flopped in the social digital space.  Also, alongside the cute spoofs made by 11 year-old boys as a present for their mum, there was stuff like this, which happened to be number three in a Google search for “Old Spice ad spoof” at the time I was looking.

Thus P&G, via its Old Spice and Pampers activity, neatly illustrates the problem with engagement in social media when you approach it without embracing how and why social media is different.  You either end up doing anti-social in front of lots of people, with minimal guarantees of success, or you do social in front of small groups of people in a way which doesn’t scale or create any other form of commercial benefit.

I think I will say that again in bold and italics.  You either end up doing anti-social in front of lots of people, with minimal guarantees of success, or you do social in front of small groups of people in a way which doesn’t scale or create any other form of commercial benefit.

How, therefore, should we ‘do’ engagement in social media.  We need to recognise that the type of engagement that is associated with large numbers is different from the type of engagement you can create with small groups.  When you are seeking big numbers, you can only ever expect, on average, very low levels of interest and engagement.  This is fine if this is enough to make sufficiently large numbers of people just a little bit more receptive to your offering, versus your competitors’.  And if you want to do large numbers, you should do it in an environment best adapted to work this way – i.e. the traditional one-to-many mass media and marketing environment.  Social media doesn’t ‘do’ big numbers, except in very exceptional circumstances (viral).  This doesn’t mean that you abandon the quest for contagion, you just don’t bet the farm on it.  Likewise it doesn’t mean that you can’t graft social media elements onto traditional campaigns – but what will happen when you do this is that social media invariably ends-up as your measurement metric, it won’t be the principal engine of engagement.  As one marketing director recently said to me, “I think Facebook is great because it allows me to see how people are reacting to my latest ad”.  Just because your Facebook likes are going up, this isn’t necessarily down to anything you are doing in Facebook, it is just a reflection of how people are feeling about your brand.  Likewise, chasing likes for their own sake, is a waste of time, other than for data capture (which is not, I would suggest, an especially social or sustainable use of Facebook).

This takes us to small groups.  Funnily enough, through our experience in traditional marketing, we already know how to ‘do’ small groups.  We call them focus groups – i.e. small groups of people, representative of our target audience, with whom we can have a great deal of engagement.  Crucially, the type of engagement we seek from focus groups is advice on how to do things better.  We don’t try and sell to the focus group, or see it as a sampling opportunity, because we know we can’t create sufficient scale to make this worthwhile.  We understand that when dealing with small groups, we have to do something else other than just make them feel nice about us, if we are create any commercial benefit.  However, we haven’t been able to export this learning into the social media space.  We somehow believe that because the (focus) group is now in Facebook, any warmth we generate will magically spread across a significant segment of our audience.  It won’t.  It may spread a bit more than was the case in a conventional focus group, but not that much more.  Instead, we end up generating the sort of engagement that only ever creates a benefit at scale – but without the scale (as in P&G Pampers).

So how do you get a scale effect, when dealing with small numbers?  Specifically, how do you do this in social media?    You do this by either finding the small group of people who are prepared to go out of their way to do something for your brand, or by responding to those people who have something to say about your brand.  It is important to realise that the former will only ever be a small group, although you may be able to reach the majority of them, and the latter will be a small group at any particular time, albeit one which potentially constitutes the whole of the larger group.  Or to put it another way, all of your consumers may, at some point, have something to say to you, but only a very small group of your consumers will ever want to have a significant or sustained relationship with you.  You will never be able to have a significant relationship with all of your consumers (#Kevin Roberts, #Lovemarks, #Fantasy, #Sorry).  This doesn’t just apply in social media – it is a basic truth of marketing, albeit one we never had to deal with when we lived in the hot-house environment of the expensive one-to-many mass message.

Looking first at your enduringly small group.  These are the people who are your real fans, those for whom the otherwise usually silly marketing lexicon of “passion” and “loyalty” actually applies.  (If you look at my previous discussion with Jonathan Mildenhall from Coca Cola – these were defined by the Man with The Red Van with the Coke Logo painted on it).  Within traditional marketing we were not really able to do anything with these people.  It was great to have them, but like Facebook likes, they represented the end of a process, not the beginning of one.  Even if we could find ways of reaching out to them, what we could get them to do was relatively limited.  They were probably consuming our product or service at maximum level.  Even if we could up their rate of purchase, this group would never be big enough for this to create a measurable increase in sales.  We could try and get them to be ambassadors or advocates, but again, it was difficult to link this to a multiplier effect which would have an impact on either sales or brand reputation.  So we tended to try and turn the spotlight on them, often by putting some of them in an ad or using their endorsement in other marketing messages, or else we just said thanks and left it at that.  Often, we didn’t even say thanks.

But now, with social media, we start to have that multiplier or, perhaps more importantly, we have the power that comes from connection.  These people can stop being individual fans and become connected fans – and connected fans can be encouraged to do stuff, beyond just sharing their interest or “passion”.  One of the first, but still also one of the best, case studies of how to do this is Lego Mindstorms.  They got groups of their most devoted fans to start to design new products.  Connected fans can become your eyes, ears and innovators – simply because they will enjoy doing this sort of stuff.  I often say that social media is actually best understood as a way in which you can get people, whom you don’t pay, to help you run your business.  Another famous example is Dell’s Idea Storm community – a process that crowdsources innovation.

Dell have extended this idea much further with their Customer Certified Solutions programme – a process whereby customers solve each-others’ problems.  This example also highlights another fact, which is that despite all the money and attention given to b2c social media ‘campaigns’, social media often works much better in the b2b environment, simply because the levels of shared interest and importance of service are actually much higher in b2b.  For example, “I got thirsty, I wanted a Coke, I drank the Coke, I got on with my day”, versus “I got sued, I needed a lawyer, I won my case, my business survived”.  Within b2b you frequently find a much higher order of needs (or technically a lower of needs if you follow the Maslow approach) and also, many more things to actually talk about (which is also relevant to the content issue).

This isn’t to say you can’t use social media to create engagement in the b2c environment (as Lego showed), but it does indicate that a b2c brand may be better advised to focus on the other type of engagement – i.e. the group drawn from all of your consumers, but defined by their desire at any given time, to actually say something about your brand.  Rather inconveniently, what they usually want to say, or the conversations they might want to have, are rarely the type of conversations you might want to have with them, in public anyway.  I.e. they will be asking questions (those questions again) such as “why isn’t this working?” or “when is the service going to be fixed?” or “why can’t you do this?”

Here is another example.  At the moment I am doing some work with a large, international, media organisation.  One of their stated objectives for social media, was to increase the size of their Facebook fan base.  They also wanted to look at crisis management, specifically what to do when people wrote negative things on their Facebook pages.  What we have done is challenge and unpick these objectives, recognising that people putting negative things on your Facebook page is only a crisis if you are trying to make your Facebook page a website – i.e. a destination to which you want to drive the maximum number of people, to receive highly crafted, one-to-many mass messages about the brand.  If you set the page up as a place where people can come to critique your product (TV programmes in this instance), negative comments are not a crisis, they are indicative of successful customer service – provided that you deal with them correctly.

It is interesting to study how customer service and complaint work in social media.  In at least nine times out of 10, you will find that what starts as a vitriolic rant about a product or service, ends-up very amiably, even if the original problem wasn’t fixed.  Once people discover that they are not dealing with a remote, inflexible, arrogant, anti-social organisation, their whole perspective changes.  They re-appraise the whole terms of engagement that they have with that organisation, once they know that it is available to talk to them at the times and in the places of their own choosing (not at the times and places of the brand’s choosing).

Now, at this point, you may well say, “where is the scale effect in that – surely this is just the same as P&G Pampers having those chats about sleeping babies on Facebook, or what we already do with our customer service phone line”.  The answer can be told via this advertising fairy tale.  Imagine there was a creative director who came to you saying they had created an ad so overwhelmingly compelling, that only one single exposure to it was all that was required to totally transform a potential customers’ or consumers’ engagement with the brand.  But, there is a catch – this ad can only ever be seen by one person at a time, if more than one person sees it, it just turns into a lemon (a bit like Cinderella’s coach after midnight).  However, the good thing is that there are still hundreds, maybe thousands, of opportunities that occur every day, to get this ad in front of individual people.  At this point, you are likely to be thinking – wow, shame we can’t just buy a super-bowl slot and rule the world, but if I can reach 1,000 of my potential consumers or customers, every day, 365 days per year.  And if the value of exposure to this is perhaps 100 times more effective than a standard “impression”, this starts to look pretty interesting.

Of course, the “ad” in this fairy tale is actually a genuine customer service conversation.  The problem with customer service, up until the advent of social media, was that it wasn’t scalable.  It was locked up in certain distribution channels – email and phone lines.  These distribution channels conditioned, or restricted, what we understood customer service to be, in much the same way as traditional media channels restricted our understanding of what content was.  Customer service was something we needed to do as one of the things necessary to preserve brand reputation, but it was never, of itself, going to move the needle upwards on brand reputation.  Therefore, it became a marginal activity, not a front-line marketing or communications tool.  However, social media has liberated customer service from these channels.  However, as with all traditional techniques, this doesn’t mean that the way we ‘do’ customer service in social media is simply to drag our old approach and techniques into the new space.  What we can now understand is that there is a huge customer service space out there, but we were never able to access the opportunities it presented when we were restricted by the usage of certain channels.  This was because we just never got exposure to 99.99 per cent of those occasions when people had questions or issues about our brand, and the tiny bit we did get exposure to was crippled by its requirement to use particular channels and had no multiplier effect attached to it.

But social media now gives customer service the multiplier effect – and that effect, as per the creative directors’ fairy tale, is that one exposure is 100 times more powerful than an ‘impression’ and we can do it thousands of times every day.  OK, to do it thousands of times per day requires some resource, but not as much as a super-bowl slot costs.

So, just imagine, instead of P&G Pampers hosting conversations about crying babies, Pampers was able to say to all of its consumers “if you want to talk to us about anything to do with nappies or our product – we are there.  You can use whatever channel you want, you don’t have to come and “join a conversation on our Facebook page” or follow us on Twitter, just throw your issue out there and we will pick it up.”  If any brand were able to make that claim, just think about how your relationship with it would be changed.  In fact, it is such a compelling claim, that I might feel inclined to make an ad about it – which also highlights another important point.  Advertising (and all the rest of traditional one-to-many mass marketing) hasn’t stopped working because social media has arrived.  The two approaches are completely different.  Ultimately, the key to successful marketing and communications going forward is to figure out how the two can complement each other, rather than try and turn one into the other.  Social media will change traditional marketing by allowing it to become much more adapted to what it does well (single message in front of lots of people), in much the same way that radio allowed newspapers to focus on what works best in print and TV allowed radio to focus on the strengths of its own particular means of distribution (i.e. the ability to listen to one thing while doing something else).  To use my favourite analogy, traditional media is like a fireworks display and social media is like a bonfire.  The two can work well side by side, but don’t try putting your fireworks on your bonfire.

This post is now far too long.  So, just to sum up.

Social media is different, it has a different set of rules and solves a different set of problems.  We therefore have to use it in a way that reflects these differences rather than trying to make it work like traditional media.

The best way to figure out how to use it is to take your lead from how the people you want to reach are using it, rather than using it in the way that accords with how we are accustomed to using traditional media channels.

The content you make has to be based around understanding and answering the questions for which your brand provides an answer – high volume but also highly specific, there is no point in simply pumping out a greater volume of traditional ‘look at me’ type editorial.

Social media hardly ever gives you numbers, so viral should never be the strategy.  The only thing that has really gone viral is the concept of customer service.

There are only two ways to generate commercial benefit from engagement: you either do something very in-depth with the very small group of people who represent your real brand loyalists, or you engage with potentially all of your consumers or customers, but only on their terms when they have something they want to say to you.  You don’t force a conversation upon them.

Very few organisations seem to have embraced these points – even the likes of P&G – although, no doubt, P&G will think they have cracked social media, after all 1.8 billion impressions is pretty cool.  I think the reason for this is that embracing and acting upon these points is uncomfortable and disruptive.  It means unlearning what we have learnt, and there are also many players out there who want to keep us in a state of ignorance.  However, it could be that P&G is right and I am wrong – I guess only time will tell.

A reply to Jonathan Mildenhall

Jonathan,

You asked me to point you in a better direction.  Here is my attempt.

It is all about using creativity in a way specifically adapted to work in the social digital space, rather than taking what used to work in the traditional mass media space and adapting it in order to try and keep it afloat.

The ‘old’ media and marketing was defined by the fact that distributing content was expensive.  Our creative approach was therefore reductive – reduce things down to concise messages, images, campaigns and then put this single thing in front of as much of our audience as possible, as frequently as possible.  This is what creative directors were taught to do.  But social media, to borrow a phrase from Clay Shirky, is “ubiquitous, global and cheap”.  Thus everyone can afford to use it in a very disposable way.  It is a casual, disposable, conversational medium, not a precious broadcast medium.

As a consequence, social media is highly fragmented, distributed and specific.  Unlike traditional media, it is not good at putting single messages in front of lots of people.  However, it is very good at reaching the right people at the right time – ‘right’ in this instance being defined not by who people are (traditional segmentation and targeting) but by what they are doing (social segmentation).  As I am fond of saying – there are only ten people critical to your business and social media can help you find them.

It also means that marketing has to shift from being reductive, to being narrative – storytelling as you rightly identify – because stories can spread conversationally in a way that messages can’t (as the game of Chinese Whispers illustrates).  However, this isn’t just about adopting the process of storytelling, it is about having a story.  Brands have to encode themselves as a story, not a series of propositions, and brands’ activities have to validate their story, not simply illustrate it (or for that matter simply repeat consumers’ own illustrations).

Most brands’ attempts to harness the power of social media fail to grasp how and why the social digital space is different and they end up simply dragging their previous ‘one-to-many mass message’ approach, and associated creative techniques into the new space.  And because this approach only works when you reach a lot of people, these so-called social media campaigns almost always come down to one thing – the quest to make things viral or contagious, the search for numbers, hits, impressions, likes.  However, viral is tough.  Most of your shots at it don’t work, and even those that do are almost impossible to replicate, or they take you into a place which starts to stray too far from your brand’s story.  Viral is often not very social.  Take the much-lauded P&G Old Spice campaign.  This boiled down to lots of people talking to each other about the ad.  No-one was talking to, or about, the brand and the only way the brand had to back was by pretending to be the man in the ad.  Pretence is not social.

Still, P&G got 1.8 billion impressions – so you could say they won in the numbers game and it would be foolish to say you shouldn’t abandon the quest for contagion, but it should never be your strategy, certainly not your social strategy.  Also – take a look at Old Spice now.  Have they replicated that contagion with their latest campaigns?  No they haven’t.

Your strategy for social has to start with the assumption that you can only ever reach small numbers of people at any given time – and therefore what you do, or get, from those people has to be very different from what you do or get when you are talking to everyone.

Take a look at your Facebook page.  I checked-out 24 hours’ worth of entries and what did I find?  First – a lot of spamming, which someone was removing relatively quickly.  Second, a load of random mentions.  Were these people’s ‘stories of Coca Cola’?  Not really, they were more the sort of scraps of affection that a brand of the stature of Coca Cola would expect to accumulate, were it to give people a place to stick them.  Third, there was stuff that highlighted a much more serious level of engagement with your brand – for example, people who were so passionate about Coke they paint their vans red and put the Coca Cola logo on the side.  There were also a small group of people who had some sort of complaint.

The interesting thing was that there was no engagement from Coca Cola with any of these people – nothing coming back – except a response to some of the complaints.  Now I know the premise of the Facebook page, reflecting its history, is the idea of it belonging to your fans.  It is not designed as a place you want to use to broadcast to everyone, an approach I would 100% endorse.  However, that doesn’t necessarily mean you can’t use it as a place to enghage at least some of the people who post stuff there.  What about the guy so passionate about your brand he paints his van red?  What can you do with him?  At the moment, his engagement, his passion, is left hanging in the wind.

Now in the world of mass engagement and creativity, you couldn’t do anything with these people.  Their passion simply became a badge of the brand’s success.  It was great to have them, and the objective of everything you do is to create more of them – but essentially, they represented the end of the creative story.  Critically, however nice it was to have people like this, you could never realistically expect everyone to be like them.  These people will only ever represent a tiny segment of your audience – a slice so small that no matter how much of your product they consume, this group will never move the needle on overall sales.  Which is why they have tended to be either ignored (as the man with the van was), or seen as a residual effect.

So – in Brazil, let’s say, you probably have a thousand or so people like the guy who painted his van red.  These people could drink Coke all day long and it wouldn’t move the needle on sales.  But what business problems do you have in Brazil that these people could help you crack?  I am sure there would be some.  For example, how do you identify and reward best practice in display and serving of your product out in the trade?  These people could help you with that.  This is the thing, when you are talking small numbers – you have to take things so much further.  In essence social media is about getting people, whom you don’t pay, to help you do your business better.

And what about the vast majority of consumers who are never going to paint their vans red – how do you reach them?  The answer is – you don’t (not with social media anyway).  You wait for them to ask you a question – and you make sure that all those questions get listened to and addressed.  All of them.  So that pretty soon, everyone knows that Coke is listening.  It is not about provoking the conversations you want to have and then reacting to them (provocation is not social).  It is about responding to the conversations consumers want to have with you – accepting that this can often be about pretty boring stuff.   This is creativity as applied to relationships and behaviours, not applied to stuff – content stuff, campaign stuff.  And there are very few big consumer brands in the world doing a good job of it at the moment because they are all focused on the search for contagion, and force-fitting traditional creativity into a social space.   Ikea, Tipp-Ex, Golf GTI app – all good ideas – but old fashioned, traditional mass marketing ideas.  The only one you mention in the video that was truly social, and thus likely to have any long-term, sustainable, impact on brand reputation was Twelpforce – and what were they doing?  Answering questions.

So – create the opportunity for the 0.1 per cent to help you do your business better.  And become known as the brand that listens and answers questions.  Creativity expressed in behaviours, not in things.  Sounds dull, and it is a tough ask to do it well, but that is how you earn a disproportionate share of popular respect.  Forget a share of popular culture – that is just a noisy stop-over on the way to respect when you are headed down the crowded highway of one-to-many mass marketing.  With social media you can take a much more direct route.

To use another analogy – traditional marketing was all about fireworks.  Social media is all about bonfires.  You can have a firework display alongside your bonfire – but it is never a good idea to put fireworks on your bonfire.

Hope this provides some food for thought!

Facebook is really a form of behaviour (and you can’t own a behaviour)

I spend a lot of time persuading organisations to not see Facebook as a form of media or content platform (i.e. something you need to ‘be in’), but as an infrastructure or tool.  This is because consumers / customers / citizens use Facebook as an infrastructure in much the same way as they use a mobile phone network.  They don’t use it as a form of media.  However, it has occurred to me that a better way of understanding Facebook is to see it as a form of behaviour, because this is probably even closer to an understanding of how people actually use and relate to, Facebook.

Facebook, the infrastructure, just happens to be the tool people are using to learn how to do social networking, in much the same was as Hoover originally made the tool necessary for people to do hoovering.

This has two implications: first I think it bears out my contention that social media strategies have to be based on creating behaviours, not things.  And second, in the long-term you can’t own a behaviour (as Hoover discovered).  This is something the awfully clever chaps on Wall Street might like to consider when deciding whether to buy Facebook shares.

OMG – Coca Cola Content 2020 – OMG (by the way, did I say OMG?)

Content and Engagement – these are Big Things in social media at the moment.  But I have a theory that no-one, not even the really big, important, famous companies like Coca Cola and P&G has any clear idea what engagement and content actually look like in the world of social media.  I suspect we are all talking a big game, but basically bluffing.

So, I was taking a wander around Coke yesterday to gather evidence and I chanced into this video of its’ content plan.  OMG.  I pressed the play button and for the next 7 minutes and 28 seconds sat there spellbound, dazed and not a little confused.  This is either:

  • a glimpse into the future of marketing that is so far out there that I struggled to comprehend its brilliance, or
  • an example of a company so totally lost it is covering its confusion in steaming piles of marketing BS.

Or maybe a bit of both.

It talks about ‘liquid ideas’ (funny that for a drinks company) and a lot about stories.  Full marks for that – I am always going on about the importance of stories and the shift from reductive to narrative marketing.  But cop a load of this for how Coke defines ‘dynamic storytelling’ – it is “the development of incremental elements of a brand idea that get dispersed systematically across multiple channels of conversation for the purposes of creating a unified and coordinated brand experience.”  Now that is class marketing BS.  It also talks about the importance of data – no complaints there.  As I have previously said, the enormous amounts of data individuals are now generating is probably the single most significant aspect of social media, from a marketing or social control perspective.   Coke puts it thus: “Data will become the new (s)oil within which ideas will grow and Data Whisperers will become the new Messiahs“.  Data Whisperers, Messiahs, wow, OMG etc.

Anyway – I was entranced.  Also, you have to take your hat off to Coke and to Jonathan Mildenhall, Vice-President, Global Advertising Strategy and Creative Excellence, who provides the reassuring down-to-earth voice-over, for letting this dish out of the kitchen.

And then – I discovered there was a Part 2!  Ten minutes and 18 seconds more!  This time I made a coffee and got the biscuits out, but like many sequels, this was a bit of a let-down.  No more data whisperers, it all got a bit operational, with the traditional exhortations to be brave and take risk with the music rousing to a climax as we end on representation of the Coke bottle.

Still, the whole thing was a fantastic insight into what could be right and also what could be terribly wrong in major brands’ approach to social media.  I am not sure which is which at the moment, but I still stand by my belief that no-one really understands how engagement and content work in this new space and no matter how important content may be, a successful social media strategy has to be rooted in the creation of behaviours, not the creation of things.   And if you are going to create content, this has to be content that answers consumers’ questions.  It is not about providing a form of extended advertising albeit in a new channel (which is the sort of place we get to at the end of the second Coke video).

Anyway – I am going to have to look into this in more depth, and certainly use this as discussion material for future social media workshops.

Update: having tried this out in a few workshops, the central issue for me is Coke’s assertion that this is all about the shift from insight to provocation.  Totally wrong.  Provocation is not social.  The only reason Coke feels it needs to provoke conversations is because people don’t want to talk to it.  Or at least, the conversations they want to have with Coke are not the conversations Coke wants to be a part of.  Coke wants to have a “look at me, aren’t I fantastic – now go tell someone else how fantastic I am” conversation.  From a creative perspective, Coke (or any brand) has the challenge of putting itself centre stage – creating attention is what it is all about.  In social media, there is no stage, there isn’t really even an audience and in-so-far as there is, this audience wants to talk to itself, not to brands.  Hence the assumed need to provoke.

In social space no-one can hear your marketing budget scream (or why being a marketing director is a bit like being a fund manager)

Being a marketing director is like being a fund manager.  You have your marketing budget, something you strive to increase year-on-year, in the same way that a fund manager has funds under management, which they also look to increase.  The challenge for both is where to allocate this money in order to maximise returns.  The fund manager has their asset categories and within these decisions about individual stocks or products.   A marketing director has a range of media assets or channels and then a decision about what type of campaign or message to put within each.

The problem that marketing directors face is that the yield available on these assets has been relentlessly declining year-on-year.  There is no safe stock, such as gold, or a way to play against the market.  Instead, they desparately need to find a new asset category, partly as a way of improving the ROI on conventional assets by reducing demand and thus forcing the price down, but also in search of higher yields.

In this environment social media can seem, superficially at least, very attractive.  Here is a whole new space to spend your money in – and there are no shortage a players looking to take it from you: digital agencies who will build you community platforms, social media agencies who will create social media campaigns, or Facebook itself who will accept big fat cheques for helping you “integrate your brand into consumers’ life stories”.  However, the yield problem remains.  In-so-far as we have been able to work out the yield on financial investment in social media (and that isn’t very far), it isn’t proving to be startling better than that available in the old media assets.

The reason for this is the unfortunate fact that the only bits of social media that are worthwhile are not available for sale.  You can’t buy social media, you can only participate within it.  To paraphrase the slogan of a famous sci-fi thriller “In social space, no-one can hear your marketing budget scream”.  The asset you need to participate in social media is people – and people are seen as a toxic asset in most businesse these days: a guarantied way to get fired is to increase headcount and a guarantied way to get promoted is to “take costs out of the business” or any of the other various euphemisms for making people redundant.

Until businesses create permission to invest in the asset that is people,  the social media space is never going to yield a productive return.

 

Facebook IPO valuation: its all about costs, not about revenue

I have had a quick look at the Facebook prospectus.  The thing I found really interesting was not confirmation of revenue and its dependence on advertising, but a very first glimpse of how Facebook’s costs are structured.  I  believe the key to working out a long-term, sustainable valuation for Facebook as a business lies in its costs – for the very simple and old-fashioned reason that a business cannot create marginal revenues that are significantly greater than marginal costs (if it is operating in a functioning, competitive market – which of course Facebook is not at the moment).  If you therefore want to understand long-term revenue potential, understand marginal costs.

Facebook has shown its costs thus:

  • Costs of revenue: $860 million
  • Marketing and sales: $427 million
  • Research and development: $388 million
  • General administrative:$280 million

This, of itself, is quite an intersting breakdown.  What other companies might there be where marketing, sales and R&D account for 41% of total cost?  A pharmaceuticals company perhaps?  However, what Facebook hasn’t done is split costs out in a way which allows us to see how much Facebook is spending on people, versus how much is spend on tangible operation costs, such as server space and data centres.  What Facebook labels “salaries, benefits and share-based compensation” is included within the figures for each of these categories, including the ‘Costs of Revenue’ line.  One would suspect that, in reality, people costs are a very sigificant element in all of these categories and it would be nice to know how this breaks down – not least because it will give us a glimpse of what it actually costs to deliver and maintain the infrastructure that is Facebook.

Knowing this is pretty important because it allows us to get a handle of what Facebook’s true marginal costs are and thus its true revenue potential.  What is already clear is that most of the costs associated with marketing, sales and R&D are not true costs, in that they are the costs Facebook has elected to incur in order to support the business model it has chosen to construct.  They are discretionary costs, in that any competitor coming into the market need not incur them in order to deliver a similar service to users.  In effect, Facebook has decided to incur these costs in order to service advertisers and chase sufficient revenue to justify a valuation in excess of $60 billion, rather than the revenue it needs to actually deliver the service to its users.

Look at it another way.  Facebook has 845 million active users.  Match this against costs of $1,955 million and this comes out at $2.30 per user.  Now I know this isn’t a truly accurate way of establishing marginal costs – but it probably isn’t way short of the mark.  So are we to believe that it costs Facebook around $2 to service every additional user.  Of course not, it will cost Facebook much less than this.

If I had to take a stab at it, I would reckon you could deliver A Facebook (if not The Facebook) to users for something in the region of $300 million.  Take that, plus a margin of say 25% and that gives you revenue of $375 million.  Put a multiple of say 15x on that and you get a valuation of $5.6 billion.  The fact that Facebook is already earning revenues of $1.7 billion, and carries a valuation in excess of $60 billion might give one pause for thought.  I don’t earn millions as an analysts at Goldman Sachs – so I wouldn’t necessarily set much store on my opinion.  But if I were an analyst at Goldman Sachs, I would certainly want a whole lot more information on Facebook’s costs.