NYPAY hosted a panel of senior rewards and loyalty experts to discuss “The Future of Loyalty and Rewards” at a gathering of senior payment industry executives on June 13 at the offices of AllianceBernstein.  The insights provided by the gathering of senior industry leaders proved to be as interesting as those of the rewards and loyalty leaders sitting on the panel.

The capacity crowd of payments industry professionals that filled the meeting space represented firms coming from all aspects of the industry, including loyalty companies, startups, advisory firms, issuers, program managers, networks, and merchants.  Among the senior executives attending and providing perspectives on the changing business of the loyalty industry were Charlie Kim, CEO of NextJump, Joe Salesky, Founder and Chief Strategy Officer for FreeMonee and Schwark Satyavolu, CEO of BillShrink. The high turnout and broad array of attendees reflected the rapid and dramatic changes sweeping the payments industry.

Panelists included a banker, a merchant, a reward and loyalty vendor and a leading industry analyst:

• Jason Brooks, SVP, Cardlytics
• Arnold Lewis, VP Customer Loyalty and Rewards, Macy’s
• Patricia Hewitt, Director / Analyst, Mercator Advisory Group
• Amy Harris, SVP, Loyalty Marketing and ThankYou, Citi

The panel provided their own perspectives of the trends and future of the rewards and loyalty business, and a healthy back and forth exchange ensued between the panel and attendees, resulting in a lively discussion.  With long-held assumptions being challenged, expert opinions vary widely; given the quality of both panel and attendees, a wide variety of insightful views were aired.

The major observations highlighted during the session included:

1. The speed at which the loyalty space is evolving is breathtaking.  Merchants have seen their choice of merchant-funded rewards options grow from the classic loyalty programs (buy 10 coffees, get one free) to incentive programs (such as 50% discounts from Groupon). For merchants, the cost of loyalty programs used to be 1%; as a result of new reward models from companies like Groupon/LivingSocial, consumers are now expecting 30-50% off purchases.
2. How shoppers see and value rewards programs are beginning to negatively impact their view of the brand. Loyalty programs grew in importance during the economic downturn as brands used loyalty to gain much needed increases in sales.  But “flash deals” have begun to erode brand value as consumers have start valuing brands at 50% less. Is a better strategy to offer point-based rewards that doesn’t reduce the value of the product or brand?
3. It has become increasingly difficult to differentiate one reward program from another. The average consumer now subscribes to 11 reward programs compared to 3 just a handful of years ago. One senior executive referred to recent studies showing that points have become currency and many consumers build rewards into their own personal financial management.



4. Panelists agreed that consumers have increasingly shown less tolerance in lag time and demand more choices and interactivity with merchant discounts.  Consumers are interested in merchant incentives that have moved from being cumulative, redemption-oriented to real time interactive.
5. Loyalty programs have evolved from being transaction and payment focused, to being behavior and activity (merchant) focused.  Sending a non-targeted offer to all prospects leads to costly behaviors or negative goodwill (sending a vegetarian a free ticket to the local meat market).  However, providing targeted, local rewards that deliver a high level of value to consumers benefits all parties to the program.

The consensus was that the industry will continue to see more loyalty and rewards models develop in the near-term before the “consumer speaks.”  We are still in the “wild west” days of rewards and loyalty where new, innovative models are being tested, and a few clear winners will emerge.  It is clear that targeted, immediate rewards that incent the desired purchase behavior will be highly valued by merchants and issuers.  The remaining question is which loyalty model will win the consumers’ hearts and minds long-term.

About NYPAY

NYPAY is a New York area industry group whose primary goal is to provide face-to-face networking and idea exchange for payments professionals.  NYPAY consists of hundreds of senior-level payment industry professionals. NYPAY continues to bring together some of payment’s leading forward thinking minds to advance the conversation and stimulate innovation within the payments industry. For information on future events and to join NYPAY, visit NYPAY on LinkedIn.

0 people like this post.

Like 

I am beginning to feel a little nervous about Social Media. I am beginning to get a little skeptical of all the Social Media initiatives around me.
But then I also read that a little anxiety and nervousness can be a good thing. A little increase in the heartbeat before you meet that someone special or before that important presentation is helpful. It just means that you care about what you are doing and want to be successful.

I read this on David Spinks‘ blog

There’s a problem, and deep down, we’re all aware of it…but to do something about it would make many feel hypocritical and so they push it aside whenever it’s brought up.

The Social Media Growth if allowed unchecked will be the next bubble to burst. There, I said it. The cat is out of the bag.

An important lesson from the dot-com bust (should be a lesson from common sense actually!!) was that companies that don’t make money cannot survive. Advertising, no matter how clever, cannot save you. Consider online pet-supply store Pets.com. Its talking sock puppet mascot became so popular that it appeared in a multimillion-dollar Super Bowl commercial and as a balloon in the Macy’s Thanksgiving Day Parade. But Pets.com was never able to give pet owners a compelling reason to buy supplies online. After they ordered kitty litter, a customer had to wait a few days to actually get it. And let’s face it, when you need kitty litter, you need kitty litter. The company lost money on most of the items it sold. Amazon.com-backed Pets.com raised $82.5 million in an IPO in February 2000 before collapsing nine months later.

Companies chased eyeballs, saying “don’t worry, revenues will follow”. People had business plans that had no mention of revenue. Web agencies popped up all over the place: building websites without a goal. You only needed “Web Programmer” or “Java” written on your resume to charge $200/hr for your services.

Fast forward to 2007. Similar story but same result. They said,

Buy the biggest house you can. Don’t worry about the downpayment. Don’t worry about the principal. Flip the house. Cash out. Live the “American Dream”.

We are still feeling the effects of the last one.

Fast forward again to the “Now” Network and we again see signs of the Social Bubble

• A search for “Social Media Consultant” on LinkedIn yields 46,069 results. “Social Media Expert” gives 12,426 results, “Social Media Evangelist” yields 1749 results and “Social Media Guru” gives 1477 results. For an industry that is 2-3 years old, that is a really large number. [Lesson: better to choose "guru" than "expert" ]
• At most of the digital conferences, the theme is “social”.
• VC money being poured into social networks, microblogs, real time search engines and other cool SM startups that have no clear revenue models. “We will eventually get there”. There is so much free in the industry that advertising alone couldn’t possibly sustain it.
• Each company and their mother is jumping into Social Media, rushing to build a Facebook fan page or Twitter following. According to Bertrand Russell, “Collective fear stimulates herd instinct, and tends to produce ferocity towards those that are not regarded as members of the herd.” It is the fear of being “left out” or not being part of the herd that is driving a lot of companies into Social Media. The prime ingredient for a bubble is the desire to do something because everyone else is doing it.

Adam Sarner, an analyst with market research firm Gartner, projected that close to 40% of social networking initiatives at Fortune 1000 companies with Web sites will will be classified as failures.

I Love Social Media: Don’t get me wrong. I do believe Social Media has gone mainstream. I do believe that the SM tools when used in the right manner can increase both personal and business productivity, improve customer engagement levels, make innovation faster & cheaper and build new relationships.

2010 is supposedly the year when Social Media will be tested. Investors will start demanding some visibility into returns and cash flows.

To keep the Social Media Wave going, it is our responsibility as Social Media Leaders/Experts/Consultants/Evangelists/Gurus/Advocates (whatever fancy term you want to use) to ask the right questions:

• QUESTION 1: HOW IS IT GOING TO BENEFIT THY COMPANY?
• Engagement, loyalty, brand building are all good things. But they are all warm and fuzzy words that others in the firm may not understand. Start thinking and talking in a language that your CFO/CEO understands. Will customer engagement and brand loyalty result in increased sales or lower costs? List down all the potential benefits and see if/how they can translate into $$$. Any marketing initiative can only be sustained if it has the support of the folks who control the dollars.

  And PLEASE, stop chasing followers. Don’t fall into the trap of “How to build 10,000 followers in 10 days”. Success in Social Media is not measured by the number of followers you have. This is not a competition on “My brand has more followers than your brand”. Social Media is for the long haul. It takes time to build the relationships and start seeing ROI. If it hurts to hear that, don’t do it.

• QUESTION 2: HOW IS IT GOING TO BENEFIT THY CUSTOMERS?
  Social Media is not a channel for self promotion. It is frustrating to see so many corporate Facebook pages, blogs, Twitter feeds ONLY talk about the firm. They are in a broadcast mode. They are not engaged with the customer. They are not listening to the customer. They are not solving customer problems. They are not building loyalty.
  You need to think how you can make the customer experience better or simplify their life or add more value.

My wife and I went to Mexico last year for our vacation. Like most travelers these days, we read hundreds of reviews: about flights, where to go, where to stay, what to eat etc. After spending days reading the many reviews, we settled in a place in Tulum (near Cancun) called Azulik. Check out some of the Tripadvisor reviews of the place:

- We spent 2 nights in #4, a Sea View cabana and one night in #1, a Romance cabana. Sea View got more air and the crashing waves sound; Romance had slightly more privacy. We preferred Sea View. In both rooms we had to keep the doors open all night to get enough circulation.
- You can’t be squeamish about bugs, iguanas etc
- You may have to banish your partner to the deck in order to have enough privacy in the loo.
- Room service has decent food and is relatively inexpensive. The best meals we had while in Tulum were at El Tabano, a few kilometers South of Azulik. The breakfast included was insufficient for us; we always had to supplement it.
- I highly recommend you attempt to score the unbelievable last-minute deal– check the website for details.

Excerpts from another review

- The location: we stayed at another place after Azulik and took countless walks up & down the beaches of Tulum (which stretch for kilometers), I don’t think there is a better location. You are literally perched off the edge of a cliff, with the best winds and the most peaceful sound of the waves.
- The outdoor tub: What an amazing idea! We loved that tub, with a view of the beach from any location you turned.
- The incredible food in the surrounding restaurants: El Tabano (by far the best restaurant I may have ever eaten at). It’s a short bike ride or cab ride away and well worth the trip. We had excellent ceviche with mango, meatballs, crepes with jalapenos, stuffed peppers, tomato/papaya soup, excellent wine and service)
- Posada Margerita: Also a quick cab ride away. This is managed by Italians and you can quickly see the Italian touches in their food. The menu includes home made pasta, fresh fish and some other great specialties.
- Trece Lunas: Best breakfast in town! Carlo, the owner will take such special care of you and he is willing to answer any questions you have. He quickly became our friend and we found out so much great info about where to go and what to do in Tulum from him.

Now, if you have read this far, you must be wondering where the hell I am going with this. Don’t worry, I have not started writing a travel blog.

Whenever we visit somewhere new, regardless of whether we expect greatness or squalor, we harbor an expectation of some sort. And we try and validate our expectations by reading about other people’s experiences. Before reaching the Azulik, I knew exactly what to expect: which room to choose, what the view would be, where to go for lunch, dinner and breakfast, what the bed would feel like etc.

Research has shown that past experience and expectations cloud our judgment of settings and stimuli. Vacations are meant to unwind, let go and experience new things. Are we closing ourselves to new stimuli and experiences because we are “expecting” our vacation to deliver a certain experience? Did we miss the roses that just blossomed because we were too preoccupied finding out the “best breakfast place in town”? Do we end up being disappointed because our experience doesn’t “live up” to its expectations?

Are we missing out on certain mysteries of life as a result of what we learn through social media? Is Social Media clouding our judgment? Is Social Media killing the element of surprise?

I heard this somewhere: “People like to interact with brands. But more importantly, they like to interact with the people behind those brands”.

Ford is a perfect example here. During 2008 and early 2009, the automobile industry faced unprecedented challenges: demand plummeted and credit became unavailable forcing GM and Chrysler to go on government life support and ultimately file for bankruptcy. During all of this, Ford not only survived without the taxpayer’s money but gained market share from its competitors. So while all companies were aggressively cutting down on costs and working with dealers to increase sales, Ford adopted a slightly different sales strategy. Ford Motors used Social Media to turn their thought leaders into sales people.

Ford’s Global Digital and Multimedia Communications Manager, Scott Monty, and CEO Alan Mulally leveraged Social Media to humanize the brand and increase sales.

And these are some reactions to the video

Scott, you are great. You are an inspiration for me as a marketer. I am even more proud to drive a Ford now! I am really happy that we share similar interests. I followed this conversation on Twitter and I really like the authenticity. Best!

Great post. It is awesome to see big companies like this actively listening to their customers. Very impressed! -Jordan

What a nice video. Alan came across as such a nice person. And…I drive a Ford too (here in the UK). It’s a Ford Focus, and I love it. It’s 8 years old and still going strong – and even manages to sparkle after it’s been cleaned.

From Facebook pages, to blogging, Twittering, YouTubing, Fiesta campaign and Flickring, Ford has been very active with Social Media. And it is showing some results too.

But wait. I didn’t see “sales” in Scott or Alan’s titles. Scott’s title reads the Global “Digital and Multimedia Communications Manager”. Scott’s thinking and approach has been innovative, helping turn critics into believers. In a world where products and services are becoming commodity, Social Media has allowed executives at different levels to interact directly with the customer, building a relationship of trust and drive sales.

Sun Microsystems’ Chief Executive Jonathan Schwartz pioneered use of the corporate blog as a tool to reach customers, employees, and others. In Sun’s effort to recover some of the glory and profitability it had in the first Internet bubble, the company has embraced open-source software, adopted servers based on Intel and AMD’s x86 processors. But that posed some challenges. According to Jonathan,

Sun makes money by selling the innovations in data centers, but that’s a hard market to reach. Free software and free ideas are the best way to reach the marketplace. Blogs and open-source software are complementary.

Despite the success of companies like Ford Motor and Sun Microsystems, it is frustrating to see that most companies don’t get it. Firms need to complement the traditional channels (sales team, partners, affiliates, dealer networks etc) with their internal thought leaders to drive sales.

If you are a consulting, agency or professional services firm, your success is defined by the type of people you have. Before a sales meeting or agreeing to sign the contract, your customers are very likely to Google your top executives or practice leads. And what comes up can be the determining factor for your firm landing the million dollar contract.

Here is a 5 step guide to turn your knowledge horsepower into individual brands.

1. LinkedIn: LinkedIn is the largest professional network today with close to 50M members. I view LinkedIn as a professional branding page. When you do a Google search on someone’s name, many a times the top result is their LinkedIn profile page. As an organization, you need to make sure that the top 100 executives have their LinkedIn profile updated with their professional experience.In the summary section, it is important to highlight the kind of challenges the particular executive has worked on and how she typically brings value to clients.
2. Blogs: With blogs, one of the challenges to keep churning out fresh and relevant content to keep your audiences engaged.My suggestion is to organize and divide the workload. For each practice area within the organization, identify 5 people who are well versed with industry trends and can clearly articulate how those trends will affect your target market. Start with a weekly post with each person responsible for writing one blog post every month.The 5th person comes into use when one person cannot meet the deadlines due to pressing client issues. The post author has responsibility for responding to comments.With fresh content coming via the blogs, your rankings in organic search will improve as well, reducing the need for paid search.
3. Twitter: Twitter is a great developing new relationships and keeping existing ones. Look for current and target customers on Twitter and follow them. Follow other thought leaders in your area of expertise to keep current with industry insights.Be Patient and Genuine. Authenticity and willingness to help others goes a long way in building relationships. Don’t just promote your own products and services.Use Angela Maiers’ 70-20-10 Twitter Engagement Formula. Be purposeful and intentional as you enter the Twittersphere. As you “Twiv to Twet” (give to get) and move away from self-promotional tweets, consider this tweeting engagement formula.a. 70% of your tweets should share resources- sharing others’ voices, opinions, quotes, blog posts, articles, content and resources. But that doesn’t mean you should rwtweet everything because you “need to communicate”. Be fresh, be thoughtful.
   b. 20% of your tweets should engage in conversations with others, responding, connecting, collaborating and connecting with others.
   c. 10% of your tweets can be chirping, chitchat as Angela calls it, on trivial details or self-promotion.

   You can use Twitter to keep your audience engaged and direct them (10% self promotion) to your website or blog.

   According to Diane Hessan, CEO of Communispace:

   Twitter has been a fantastic vehicle for getting information about Communispace into the marketplace fast. Most recently, for instance, when Communispace launched its new blog, Verbatim, I sent a tweet out about it, and more than 1,000 people came to our blog as a result.

4. Communities: Once you have a steady stream of followers on your blog and Twitter pages, it is useful to turn those interactions into an ongoing relationship. At this point, you should think about developing communities on different topics of interest. To maintain strong ties with the community members, it is a good idea to limit the size of the community.For some more reading on developing communities, please read
   a. Size does matter: the secret sauce to building online communities
   b. Online banking: communities help meet psychological needs (though this is for the banking industry, some of the insights are relevant)
5. Develop a 3rd Party Sales Team: As you start connecting with other thought leaders within your subject area on Twitter/Your Blog/Your Community, start developing a relationship with them by subscribing/commenting on their blog.Give the relationship time to mature. When the time is right, in a subtle way, engage the influencers by offering them demos and opportunities to review products and services.

Last but not the least, there is no substitute to human interaction. Take some of these online relationships into the offline world. Whenever you are traveling, try and meet someone from your online world for a beer or lunch.

So go out, turn your thought leaders into sales people.

My recent posts talked about Social Media reaching the tipping point and the factors leading to mass adoption of Social Media. But what is the one thing that will separate out the Social Media successes from the failures?

If you are thinking ROI and Metrics: yes, they are important and very good answers. The others listed in the Equation Research study are important as well. But I think the biggest contributing factor to the Social Media success story will be COMPANY CULTURE. Social Media is about building a culture of collaboration, authenticity, trust, openness and innovation. Companies that are able to build such a vibrant culture will grow and thrive and create value for their shareholders.

When you think of Social Media successes, the first company that comes to mind is Zappos. Customer Service is in Zappos’ culture, its DNA. Zappos built a real culture that puts the customer first, rather than lip service and mission statements. The story of the Zappos rep who sent flowers to the lady whose husband had died in a car accident is mind blowing. The first week of training at Zappos is not about Social Media tools and technology, but about Zappos’ culture and core values (Number 1 value is Deliver WoW through Service).

But culture is also the hardest to change. The following comment by Andy Sernowitz, author of Word of Mouth Marketing, sums it well.

Don’t underestimate the amount of bravery it takes. You find yourself almost immediately in a two-front war, fighting both an entrenched bureaucracy and a skeptical audience.

It is about fear of letting go, fear of losing control.

It is also harder because social media touches almost all parts of your organization.

1. With your employees available on Facebook, Twitter or LinkedIn, customers don’t rely on the 800 or the PO BOX number to get in touch with you. They can get in touch with who they want and when they want. An awful amount of power in the hands of the customer, right?
2. Point 1 combined with the increasing and changing customer demands puts a lot more pressure on your research, customer service, operations, technology, PR, distribution, marketing and legal departments to function more efficiently and respond to customer needs/problems more quickly.

Does this mean you should give up on Social Media? Hell, no. Social Media is here to stay. But that doesn’t mean that you should start sending gifts or flowers to all your customers. Not every company needs to or should become Zappos. Companies need to think hard about their overall organization structure and strategy before they say “yes” to Social Media.

And if you are looking to change your culture for better social media adoption, here are a few things you can do:

• Hire the right people, empower them and encourage them to take risks
• Create the policies and guidelines so that people don’t go overboard and overexpose the firm
• Have a CEO and senior management who is open to new ideas and embracing change
• And finally, reward the risk takers and celebrate their failures

Some other interesting read on this subject

• Social Media is part of Corporate Innovation Strategy
• HBR: Creating a Culture of Innovation
• Designing the Social Business
• 7 Things to Think About Before Jumping In

Google was caught surprised earlier this year when celebrity gossip site PerezHilton reported that the site’s #1 source of traffic was Facebook and not Google. Whoever wins in the numbers race, one thing is clear that more and more people are relying on social networks and blogs and twitterfeeds to get news updates, product reviews and than ever before.

People are increasingly relying on each other for one simple reason: they don’t trust marketing and advertising. Yankelovich reported that 76 percent of American consumers believe that companies don’t tell the truth in advertising. And this skepticism is getting worse rapidly: Yankelovich also cited that 60 percent of surveyed consumers have a much more negative opinion of marketing and advertising than a few years ago.

The good news, of course, is that consumers’ trust of each other is rising as rapidly as their trust of traditional marketing is falling. Neilsen reports that 78 percent of customers say that consumer recommendations are the most credible form of advertising, with 83 percent agreeing that online evaluations and reviews influence their purchasing decisions.

In my opinion, the search engine of the future will integrate search results (especially for very involved purchasing decisions) with my friends’ product reviews on different social networks, blogger reviews, twitter feeds and review sites. The results will further be categorized by semantic engines like Newssift and Sprout Labs to understand whether the underlying sentiment with the product/service is positive or negative. Think of it as an integration of Google with SocialMention, Newssift/Sprout Labs with the results ranked and rated and available to view on the search page.

If I am in the market for a car, why do I need to leave Google/Bing to go to Edmunds.com or JDPower or Cars.com to check product reviews and then to blogger reviews and then check with friends who have owned that car for their feedback? Won’t Google be a lot more valuable to you if it searched all the user generated content across Facebook, Twitter, Blogs and Edmunds etc and presented a negative/positive sentiment on the latest model of Lexus?

And imagine the value to advertisers: you never have to leave Google so all your clicks are coming from a single site.

But I don’t think this is going to come from Google. It will be one of the innovative start-ups who will integrate social media with search.

More reading on this subject

• Using User Generated Content to Enhance Conversion Driven SEO
• Google “Hot Trends” integrated into Google Search
• Why are conversations (with the right person) so much better than search?
• Your users trust each other and Not You

The New World Order is Socialism: I mean the digital world! Successful brands of tomorrow will be the ones that are comfortable letting go of so called “control” and work with the customers in creating the brand image.

According to Dunkin’ Donuts Brand Marketing Officer Frances Allen: “Customers will decide what our brand is about. And there is nothing we can do about it. And that is a very liberating thing. In the end, you can’t control it. And that’s the beauty of social media. And that means marketers have to let go – a little”

Listening to some of the panelists at the recently concluded OMMA Global, I realized that some of the brands get it. Companies like Ford, NY Times and Dunkin’ Donuts have leveraged the power of Social Media to build brand awareness, customer loyalty and increase sales.

Martin Nisenholtz, SVP Digital Operations at the New York Times Company says the Times loves Twitter. Twitter has become extremely important distribution feeder for the NY Times. Times has over 200 Twitter feeds and adding 15,000 followers a week. And talking about ROI, Twitter now drives 10% of NYT digital distribution, up from 0 a year ago.

From Facebook pages, to blogging and Twitter accounts, Ford has gone crazy for social networking. And there are no limits, according to Scott Monty (Twitter @ScottMonty), Global Digital & Multimedia Communications Manager at Ford Motor Company. Ford is presently in its eighth month of its Fiesta Movement social-media program to promote the eponymous car from Europe by letting 100 young social-media-savvy Americans drive the vehicles for several months. Each month, Ford has been assigning tasks to the “Agents” involving lots of driving and just as much blogging, Twittering, YouTubing and Flickring. “People are finding out about the Fiesta from people like them,” said Scott.

So what do companies and marketers do to adapt to a world where

• there are plenty more choices available to the consumer
• media is fragmented
• attention span has reduced dramatically
• audience is not listening anymore

What do they need to do different in order to survive and grow?

Marketers have to move away from the ‘broadcast” mode where they would just create information and then do a mass publish to the consumers. Marketers need to establish trust and authenticity. Marketers need to LIE in order to be successful.

L: LISTEN: Trust is built by understanding and acting upon the needs of the customer. To understand the needs, you need to listen in. Grow Bigger Ears. You need to make yourself accessible via Twitter, email, phone, whatever tool you use to answer a question, provide information. People trust people like themselves. Again, to cite @ScottMonty at Ford: “Your brand is not my friend. I don’t want a cup of coffee or car or piece of clothing to “friend” me on Facebook. I want the brand manager, designer or engineer. I want someone who can talk to me/listen to me.”

I: INFLUENCE: After Listening and Learning about the customer needs, you need to act on it in an authentic manner. Transparency and Authenticity are key in creating a degree of influence. Deborah Schultz, Partner Innovation Practice, Altimeter Group cautions: “Always be truthful on social media…Google is the long tail of lies.”

E: ENGAGE: If you constantly listen and learn from the customer AND influence her by acting in a transparent and authentic manner, you will enter the engagement phase with the customer. Engagement is where the customer becomes a brand ambassador/advocate. Customers in this phase are the most profitable. They provide you feedback and suggestions for improvement. They bring in other customers. They are willing to pay a higher price for your product compared to that being charged by the competition.

It will be interesting to see how companies adapt to the new Socialist order and how many are willing to partner with the customers to develop what the brand should stand for. What do you think will be some of the challenges?

0 people like this post.

Like 

So, Social Media has become a part of our daily lives. We discussed in a previous post how 80% of online Americans use some form of social media and how marketers increasingly plan on using it. So, what changed? What is leading to the widespread adoption of social media? I identified 3 trends:

• iPhone: With a iPhone in every hand, it is easier than ever for people to read, create or participate in any kind of social content. You don’t have to wait to get back to your PC to let your friends know about the cool dinner place you just went to or respond to comments on your blog. iPhone and a range of Android powered phones that are coming into the market now have completely revolutionized the internet experience.
  It has given instant gratification a new meaning. The other day I was at the US Open Finals and was using to iPhone to share the experience with my friends: updating match photos, responding to people’s comments on my status on Facebook, sending out tweets.
• Twitter: The average number of tweets sent out everyday is 1.9 million. Twitter is sometimes called the SMS of the Internet. Big companies like Dell, Starbucks, Bank of America and Comcast have been using Twitter to promote their products and answer customers’ questions. But you know when a trend has gone mainstream when small businesses and entrepreneurs are using it as part of their strategy to build customer loyalty and grow their revenues. The Wall Street Journal carried an article last week titled “Entrepreneurs Tweet Their Way Through Crises“. The NYT carried another article on increasing success with small businesses back in July.
  You know when a trend has gone mainstream when the country’s president uses it for fundraising and staying connected with the voters during the presidential campaign.
  You know when a trend has gone mainstream when people are using it for news on crises and emergencies. During the Mumbai terror attacks, tweets were being posted at the rate of 70 tweets every 5 seconds.
• Early Adopters: As of Jan 2009, 54% of Facebook users were under 24 years old. The median age of a Twitter user is 31. Every new platform or tool requires a set of people who are willing to buy into the trend, experiment with it and provide constructive criticism. The work of William Struass and Neil Howe offers some insights: raised with laptops and cell phones, this generation is comfortable with evolving technology.
  A 2004 Pew Internet & American Life survey found 84 percent of 12- to 17-year-olds owned a computer, cell phone or Personal Digital Assistant. Cell phones help maintain an often close bond between young people and parents.
  Other findings in the Junco and Mastrodicasa survey included that 76% of students used instant messaging, 92% of those reported multitasking while IMing, and 40% of students used television to get most of their news and 34% the Internet.

iPhone made social media available on the go; tools like twitter, facebook, blogger and youtube made it easy for everyone to create and share content online and the Millennials provided the critical mass needed to take it past the tipping point.

Do you see any other trends shaping growth in social media?

LinkedIn: http://www.linkedin.com/in/guptanitinonline

0 people like this post.

Like 

I am planning to be at the OMMA Global Event in NY next week. The theme for this year is

The New Socialism: welcome to a world where social networks, social media applications and microblogging services become our central means of engaging online. Many industry watchers believe the answer to online advertising’s oldest problem lies inside social media’s walled gardens: that is, how to bring the estimated $500 billion spent annually on offline brand advertising to the Web.

Given that OMMA is giving so much importance to social media, I was surprised that OMMA has not used any of the social media tools on the conference website. The website’s main purpose is to give participants information on the conference agenda, program schedule and speakers bio. And that’s where it stops.

The challenge with most conferences is that you don’t know the other participants, their background, their areas of interest. Won’t networking be easier and you get more value from your investment of time and money if OMMA had done some of the following?

• Create communities of interest: the conference has 11 different themes or track sessions including Mobile, Search, Metrics, Gaming, Video, Behavioral etc. It could have easily created participant communities based for each of these sessions to encourage interaction and networking.
• Ability to interact with speakers: Along with the speaker bios, it would have been helpful if I also knew the link to their blog and/or twitter handle.
• Ability to interact with the sponsors: Sponsors often complain that the breaks during sessions aren’t enough to interact with participants and share with them the value proposition of their tools/products. OMMA could have created more value for the sponsors by allowing participants to interact directly with them. That way, they could have used the breaks for follow-up sessions and shortened the sales cycle.
• Ability to post questions ahead of time: With knowledge of some of participant questions beforehand, the speakers can not only make the session more interactive but also fine tune it to the audience needs.

I do still believe that it will be a great conference to attend given the Who’s Who of Digital Marketing speaking at the event. But I would like the next Social Media Conference to leverage some more social media tools.

LinkedIn: http://www.linkedin.com/in/guptanitinonline

0 people like this post.

Like 

We discussed some engagement metrics in my previous post: level of exuberance or bonding or conversations with the customers. While engagement metrics are very important for measuring Social Media, NO marketing campaign can be sustained or successful without getting an adequate return on the dollar. We need to look at other quantitative metrics in addition to the ones we discussed earlier to measure the Return on “Investment”. To calculate return, we need to see:

• Increase in repeat business from existing more satisfied customers
• Revenue generated through new customer acquisition
• Revenue generated through customer referrals
• Decrease in support costs as problems get identified earlier
• Decrease in sales and marketing costs due to reduced customer turnover

But are quantitative and qualitative metrics alone sufficient to measure the success of your Social Media strategy?

I was at a social media event earlier today hosted by Acxiom and got introduced to a new definition of ROI: Return on Insight. Webster defines “insight” as the act or result of apprehending the inner nature of things or of seeing intuitively.

Metrics measure past events. We have all heard from financial advisors that past stock market behavior is no indicator for future performance. By focusing solely on metrics, you may miss out some customer conversation that will lead to the next big innovation for your company. You can gain valuable insights and feedback on product features and design (or service components) that will bring you closer to consumers and ultimately lead to a bigger market share.

So, I am proposing a new mantra for measuring Social Media: Return on Investments and Insights (ROII). And the first “I” should be Investments, to keep the focus on MONEY. But let us not lose sight of INSIGHTS.

What are your thoughts? I would love to hear what monetary and non-monetary metrics you currently use…

0 people like this post.

Like