Social Media Influence 2011

Final bookings are being taken for SMI 2011 which takes place of June 14 in London.  This is always a good event, especially for those taking on the responsibility for developing social media within an organisation.  It is not an agency-fest and I note the list of speakers this year is heavy on actual social media managers from UK based companies (Sony UK, Tesco, O2) who will be talking about their experience, rather than ‘gurus’ or people with products to sell.  Definitely worth attending if you have (or would like to have) responsibility for social media within your organisation.

Twitter makes You stupid (but Us clever)

Here is a very thought provoking post (sorry, article) by Bill Keller, executive editor of the NY Times.  I especially like the historical perspective and connection to Gutenberg – something which is not debated or understood enough.  We cannot really understand social media unless we also understand history, which is why I always begin my “What is social media?” presentations by looking back 600 years so that we can understand the extent to which our world has been shaped by the enforced marriage between information and expensive distribution technologies – a marriage which social media is ending (because media – the ability to distribute information – is no longer expensive and information is now liberated).

In much the same way as Keller highlights the cognitive trade-offs that have occurred as technology has developed (books effectively reducing our capacity to remember for example) it would seem logical that there will be some form of trade-off associated with social media.  And it may well be that the trade-off is that collectively we become more intelligent and powerful, but individually we become more stupid.  Perhaps it may be that stupid is not the word – rather we will become become more dependant – not just on the technology itself but the forms of community it is bringing into being.   We become a bit of number of brains rather that a brain in itself.  This may be a good thing, or it may not – but it important that we are aware that it is happening and adapt to its implications.

The right to legal priviledge versus the right to sensationalise

Lets be clear about something.  This whole institutional dust-up is not about privacy and human rights.  It is about the tabloid media’s presumed right to sensationalise (and the worrying ability of social media to deflate its ability to titillate) and the legal establishment’s presumed right to exist.  Basically it is all about the erosion of institutionalised privileges.

Looking first at the media.  What is interesting about the whole affair is that the suspension of traditional media’s ability to report gives us the opportunity to analyse how social media in isolation is handling the story (i.e. the story about the footballer not the story about the institutional fight) and compare this with the way the mainstream media traditionally handles such events.  Within social media we have a simple tweet which states that x footballer had an affair with x semi-celebrity.  This prompts some discussion and debate within the relatively small digital communities that are interested in the individuals concerned.  This discussion goes along the lines of “So-and-so has had an affair.  All these footballers are the same.  Shame though – this bloke seemed to be one of the exceptions, but at least he has patched things up with his missus.  Ah well – lets talk about more important things like the big game coming up next weekend.” There are also some quite good jokes that are made – British pub and terrace humour at its best.

The way the tabloid media might choose to report this story would be to splash screaming great headlines of outrage across the front page, send legions of paparazzi to stalk the individuals concerned and their families, to tease-out (and frequently invent) as many lurid details as possible and do everything possible to convince us that this event is the single most important piece “of News the World” must be interested in.  What a difference – a difference which exposes the fact that the media don’t like the right to privacy because it impinges upon their right to sensationalise and they don’t like social media because it similarly deflates their ability to titillate.

The legal establishment is all in a flutter because it is slowly starting to realise that social media is creating a space within which it is powerless.  In fact, worse than powerless, totally irrelevant.  You simply cannot apply an institutionalised legal framework to the specifics of information within this space because the core assumptions you need for this model to work just don’t exist (and never will).  Social media exists outside of the law, not because it wishes to break the law, but because there is no law yet in this space.  Try as you might to drag bits of current legal process into it and all that happens is that you end up looking silly.  And when we do come around to creating some framework of control that works, we may well find that what works is not actually law as we currently know it (the thing that has lawyers, silly wigs and fees and all that stuff), but something based around the creation of social permission that it all together more, well, permissive.  Basically this will mean working out the codes of behaviour that are required to allow society as a whole, rather than editors or judges, to work out what importance to attach to information.  Critically this is not about determining what is right or wrong – something  that is fit for publication or not fit for publication.  Rather it will be based around ensuring the ability to generate a collective assessment of interest or relevance – something which social media actually already does rather well, quite unencumbered from formal regulation (as the general lack of interest in said footballer’s private life, as represented within social media, neatly demonstrates).

LinkedIn CashedUp CrashReady

LinkedIn has ended its first day of trading as a public company with valuation of $8.9 billion.  This is 36 times its 2010 revenue.  That’s right – 36 times revenue.  As this Mashable piece points out this compares with Google at 5.5 times 2010 revenue and Demand Media at 4.4 times revenue.

What is the difference between LinkedIn and Demand Media? Well,  Demand Media has a business model: a business model that is currently working and which is rooted in the fundamentals of its business.  LinkedIn has none of these things.  Perhaps that fact that Demand Media has a functioning business model means that analysts have some form of reality upon which to base their assessments, whereas for LinkedIn all we  have is a model that appears to be a cocktail of one part fantasy and one part ignorance.

Whatever model the ever-so-clever money men are using, it will probably be one that basically regards LinkedIn as a form of content platform or media.  However, LinkedIn, Facebook et al are not forms of media, they are actually infrastructures – that is certainly is the way people use them.  I don’t know how you value LinkedIn as an infrastructure, especially when it is an infrastructure that didn’t really cost anything to build, where the idea behind it easily replicatable and the content within it essentially remains the property of its users.  That sounds to me like a max three or four times revenue multiple proposition.

At some point in it is going to dawn on Wall Street that these properties are largely disposable infrastructures that simply host content on behalf of users – basically branded data storage facilities with some service add-ons.  And then we will get the crash.

How do you teach social media?

Last Friday I spend the day at the Plantijnhogeschool in  Antwerp, giving the keynote speech at a conference organised by the European Foundation for Commercial Communications Education (now to be known as Ed Com).  This is basically the place where the institutions who teach communications meet the agencies who employ the people they teach.

The main talking point revolved around the issue of how you teach social media linked to the continued relevance of “The Big Idea”.  There seemed a large constituency of support from both academics and industry, that we still need The Big Idea, in large part to have a conversational starting point, and that social media’s problem derived from the fact that there did not seem to be such an idea that was visible within most social media campaigns.  This was seen as a relevancy issue for social media, rather than a relevancy issue for Big Ideas.

My view, not surprisingly, was slightly different.  In the first instance, social media does not “do” campaigns.  Social media is about sustained engagement, often with small numbers of people at any one time, but which happens over a long period of time – indefinitely in fact.  Secondly, in-so-far as social media conversations have to start somewhere, they don’t start with The Big Idea because that is not what people actually want to talk to brands about – it is what brands wished people would talk to each other about.

The Big Idea ‘du jour’ was T Mobile’s Life is for Sharing – prompted by the recent viral success of its Royal Wedding video as well as previous flash mob virals.  Now Life is for Sharing is, indeed, a Big Idea and it has been used as a creative platfrom very effectively by its ad agency Saatchi & Saatchi.  But here is the thing: you need Big Ideas to make ads but they don’t work in social media because T Mobile’s customers (even those that watched and ‘liked’ the YouTube clip) don’t actually want to talk about Life is for Sharing – or if they do, they don’t want to talk about that with T Mobile.  What they want to talk about with T Mobile is much more prosaic.  They want to know why their phone doesn’t work, or why, when the start “sharing their life” whilst roaming it costs them a small fortune.

But of course, these sorts of mundane customer service or product issues, were not seen as being relevant to brand image or marketing – the carts to which the old nag of Big Idea is currently harnessed.

And therefore, when it comes to teaching, the issue is not really how you teach social media so much as to whom you teach social media.  If you see yourself in the business of creating the creative directors of the future, there is about as much point in teaching them social media as there is teaching footballers to play cricket.  But if you decide that you are creating future communications practitioners, then social media is highly relevant – but not teaching social media as a form of media (which it is not) rather understanding it as a set of behaviours.  We therefore need to look to more towards psychology, or even history, to provide a way to do this than we do towards creativity.

How do you regulate social media? Do you regulate social media?

Last week I had an interesting experience, presenting at a workshop on regulating digital media.  (My presentation is here, for those interested).

The folks attending were, in large part, those to whom Government (in its various iterations) has decided it falls to Do Something about the regulation of social media.  However the real problem they have, as I saw it, is that the current model of regulation just doesn’t work in social media.  This is because the current model relies on the fact that information is always married to an institutionalised means of distribution and this means of distribution is both the dominant partner in this relationship and can be regulated.  However, social media is all about the liberation of information from a particular means of distribution and therefore the means of distribution (the media) has ceased to be a gatekeeper through which we can control information.

Here is an example, drawn from some of the case studies discussed.  A nightclub in Belgium was running a party called French Kiss.  Continue reading →

The future of advertising, media and Facebook (in Bulgaria)

A couple of weeks ago I was in Sofia, Bulgaria, to run a workshop and speak and the annual gathering of advertising and media folk, organised by the Bulgarian Assosication of Advertising Agencies.  I was doing this wearing my hat as a member of the faculty of the EACA School of Advertising and Communications.  Essentially I was there to explain, as politely as possible, that the business model of advertising is broken.  (Here is the presentation for those interested – it will make only vague sense since it is mostly just a collection of images Sofia 22 March 2011)

In the run-up to this I was also asked to answer some questions about the future of advertising, traditional media and Facebook for the online publication Human Capital.  Here are the answers – for those who speak Bulgarian, but I thought I would also publish them here in English, since it is relevant to advertising and media everywhere, not just in Bulgaria.

What are the major differences between traditional media and social media from advertisers’ perspective?

Continue reading →

Facebook: the new AOL

Continuing the Facebook / business model theme, here is an interesting observation I saw on Social Media Today from Jim Worth.  He says that Facebook today reminds him of AOL in the 1990s.  AOL became the gateway people used to get onto the internet in much the same way as Facebook is the gateway people use to do social media.  But once through the gate, people often move on.  That, in a nutshell, is the problem Facebook faces.  Failure has stalked all of those who try and hold onto the people they take through the gateway – from AOL to Yahoo.  Why should Facebook be any different?

links for 2011-03-15

Why Facebook is abandoning individuals in favour of communities

Here is a bold claim.  In social media you can’t make money out of individuals, only communities.

Here’s why.  In the good old days, the way you made money out of media was by being a platform that allowed commercially sponsored messages to be placed in front of lots of individuals. For this to work well, the message had to be be very effective (which is why advertising creative directors made lots of money) and the media had to attract lots of individuals. The more individuals a platfrom could attract, the more money it could charge for its real estate.

This model doesn’t really work in social media, because, as we are slowly starting to realise, platforms such as Facebook are not really media platforms. Facebook can more easily be understood as a tool or an infrastructure. Despite what the film says, it is not a social network, it facilitates social networking. There may be huge numbers of people using the infrastructure – but you can’t reach ‘all of Facebook’ in the same way as you could reach ‘all the readers / viewers’. In reality, Facebook is an eco-system comprised of a vast number of tiny interactions bewteen very small groups of people. This creates a problem, because the commercial opportunity within these types of interaction is highly restricted. In the same way that no-one would want a commercial message inserted into a phone call, people don’t see a role for commercial intervention or interuption in the individual, small scale, relationships people have on Facebook.

This is a big problem for Facebook, because its current very high valuation is based, in large part, its status as a platfrom that can access millions of people. It has the millions of people, but it cannot provide the access in a way which makes commercial sense and complements the way in which people use the infrastructure. It can only sell itself as an advertising platform, but it is slowly realising that the value of an individual person within Facebook is an awful lot less than the value of an individual reader or viewer. Facebook is coming face-to-face with one of the fundamental rules of commercialising social media: in social media, you can’t make money out of individuals, only communities.

Essentially, there are very few chinks in the armour within individual interactions in social media that allow a credible intervention by an institution or commercial organisation. That is not to say that you should abandon the individual. Listening to individuals and their conversations, and responding where necessary is still a hugely valuable exercise. It is just that 99.99 per cent of all social media activity is un-receiptive to commercial intervention and thus it is just not scalable as a way of reaching lots of people.

However, this starts to change when you stop focusing on the individual and start to focus on the communities that individuals might form (focusing on behaviours, not on platforms or tools). Community is undoubtedly the ‘Next Big Thing’ in social media. The community is the new individual and the community probably represents the only sensible entry or engagement point for most institutions. In working out how to extract commercial value from community it is important to recognise one of the other fundamental rules – which is that individuals will be reluctant to allow themselves to be managed within communities controlled by institutions, rather they will prefer to form communities to manage their relationships with institutions. As people become more familiar with the tools of social media, they will work out how easy it is to create communities that help them ‘do stuff’.

Facebook understands this – which is why it has recently made changes to Facebook Groups and Facebook Pages which are designed to make it clear that Pages are where corporate organisations can have their Facebook outpost but that Groups are for individuals. Facebook is going flat out to encourage its users to aggregate themselves into small communities (Facebook Group functionality starts to de-grade once the Group exceeds 250 members), because it knows that its user base becomes commercially much more valuable as a large number of small communities than as an even larger number of individuals. The problem, of course, is that there are many other tools individuals can use to create communities – many of which are better than Facebook and thus Facebook is in a race a aginst time to try and establish the behaviour of community formation within Facebook in order to try and steal a march on the competition.

This is consistent with Clay Shirky’s assertion that revolutions don’t occur when societies adopt new tools, but when they adopt new behaviours. It is also consistent with Facebook’s objective of being the single tool you use to “do” all your social media, rather than being an application you can use to integrate tools produced by others.