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The Anti Social Irony of Social Media Monetization Models

Posted in Bill James, Digital Work Ethic, facebook, Functionality, Monetization Models, social media, social media marketing, we engage with tags , , , , , on May 11, 2011 by monozygote43

I’m tired of hearing that building a business following in social media is unavoidably hard work and that fans and followers have to be earned in Facebook.  Why must the work of building a marketing channel in Twitter or LinkedIn be so difficult and so unrelenting?  Why do we have to sweat blood for years to associate and share with our fans, followers and contacts?  Why is this new digital work so hard?

I hate to break it to the cheerleaders for the hip, new, digital work ethic, but the main reason it’s hard to raise fans, followers and contacts in social media is because owners of the large social media applications have made it hard.

The social functionality of social media applications, or lack of it, mirrors the broken designs of the current monetization models applied in social media.

As well as having to endure the dumbed down social functionality, we also have to endure the self righteous cacophony of naive digital romantics and the mantra that building networks wasn’t meant to be easy.  The authenticity and engagement evangelists are urging us to accept our digital drudgery in the spirit of a new digital work ethic.  Shades of Max Weber and the Protestant Work Ethic.

Two monetization models dominate social media.  Both of them anti social, unproductive and causing restricted functionality around search, association and sharing of content.

In the first of these models, users pay to access additional functionality after embracing the initial concept of the application.  That’s the LinkedIn ‘account upgrade’ model.  In this model, users are systematically frustrated by the lack of social functionality in the basic or free account.  The design is to have them ‘upgrade’ to buy relief.  Start with a free ‘basic’ account and pay to go ‘pro’.

This model struggles not only because many users resent being forced to upgrade.  It has failed because users have ways to sidestep the cropped social functionality of the basic account by joining the LinkedIn open networking culture inside and outside of LinkedIn.  There are now so many ‘open networkers’ that LinkedIn just couldn’t get an acceptable financial outcome from the account upgrade model without introducing advertising.  After all, why pay for something you can access from the free basic account type?  That’s not to say that recruiters and those marketing B2B aren’t upgrading to increase search entitlements and in-mails…but not in sufficient numbers to support LinkedIn’s pending IPO.

In the second model, advertising is introduced.  Facebook, LinkedIn and Twitter all now rely on advertising.  In Facebook, only business pages can advertize while in Twitter and LinkedIn, there is no distinction between business and personal accounts.  Anyone can advertise in LinkedIn and take a sponsored tweet in Twitter.

So, what’s wrong with advertising?

The problem with relying on advertising as the keystone of revenue raising is that the application has to simultaneously strangle any social functionality which would allow brands to communicate with their marketing demographic or targets by other means within the application, and any functionality allowing users to search and associate with brands.

For example, business pages in Facebook offer primitive social functionality.  They can’t reach or communicate with personal profiles in any way other than through the few loop holes which Facebook has inadvertently left open. These include tagging posts to other business pages that have the same market demographic and swapping ‘likes’ (liking pages whose owners have liked your page).  Other than that, they can only communicate with personal profiles which already ‘like’ them, or if their followers spam their own networks by sharing business page posts.

Will this drive brands to advertise? Facebook hopes so.  Maybe it will, but only after the owners of business pages exhaust less expensive options to drive traffic to their Facebook pages from outside of Facebook including using existing email/sms databases, twitter, and point of sale advertising, etc.

Also, personal profiles can’t search Facebook for businesses by any means other than typing in their account name.  Facebook search is primitive for personal users.  The fact that it’s primitive is not a natural phenomenon.  It’s failure to evolve is by design.  Considering the data Facebook holds regarding business pages (see the Insights package), the types of directories and customizable searches which could be conducted (if Facebook was actually focused on assisting personal profiles to find the brands they want to follow and use) are myriad.

A primitive search function makes perfect sense in the context of trying to force business users to advertise in Facebook.  Hence monetization models define the nature of social functionality and the evolution of social functionality.

The anti social design of both monetization models is clear.  The free ‘basic’ account is slow and tedious with limited functionality.  The paid advertising model is based on the need to ensure that networks which are built through advertising can’t be built by accessing freely available functionality in the application.  It’s meant to be hard work.

One application’s cropped social functionality is another’s business opportunity.  LinkedIn and Twitter both have strong ‘follow back etiquettes’ which will conflict with attempts to raise revenue from advertising.  LinkedIn’s excellent search criteria option together with Twitter’s hash tags will also make it harder to drive users to paid advertising.

The ‘follow back etiquette’ is now dogging the heels of Facebook too.  It’s a recent phenomenon for Facebook and totally due to the introduction of advertising.  The owners of business pages are seeking relief from the restrictions on network building functionality driven by the current monetization model.

The micro network tapestry of social media connects all the major applications. Facebook ‘like’ exchangers are holed up in LinkedIn groups and out of reach from Facebook recrimination.  LinkedIn open networkers meet in open defiance of LinkedIn at URL’s like TopLinked.com.  Networks seeking to restrict social functionality will be choked of ‘blood’ supply and bypassed.  Marshall McLuhan was right.  Social media, like all media, is an extension of human sensory perception.  Humanity has fused itself within a single digital organism comprised of millions of micro networks.  Just as no nation State can isolate itself from the global economic system, no social network can isolate itself from the total fabric of cellular digital society.

The market for social functionality in digital media is beginning to behave like the global market for capital.

If US interest rates are near zero, investors may use their US dollars to buy the currency of another country where domestic interest rates are higher and invest local currency in those local markets for a superior return.  This is called the ‘Carry Trade’.

If the return on effort made to build a social network is higher in one social application than another, or the ‘black markets’ of the ‘follow back etiquette’ offer huge returns for the network builder, users will move their time and effort to those applications and those URLs.

Truly, there is nothing new under the sun.

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Why brands should ignore ROI in online and social media for now.

Posted in Bill James, roi, social media, social media engagement, social media marketing, Social Media ROI, social media strategy, we engage with tags , , , , , , , on April 23, 2011 by monozygote43

Management seems confused about why they need to deal with social media.  Most of those with responsibility for profit performance are missing the point when it comes to new media and ignoring the history of past media revolutions.  Consumer markets are going through a transition phase regarding their media preferences.

Right now, ROI isn’t necessarily about new revenue and new sales.  It’s more likely to be measured as the market share a company doesn’t lose.

All other things held constant, the rise of online and social media hasn’t created new markets or consumers (with the exception of those buying and selling stuff needed to engage in social media).  Social media is a new communication preference for existing customers in existing markets to engage, assess and choose the brands with whom they will transact business in future.

Future being the key word.

One facebook account may take over 4 hours a week from the available time of a mother of 2 children.  That’s 4 hours a week less one mother has to spend in other communication channels in future.  Less time in stores, magazines, newspapers, TV and radio.  The same goes for the mobile platform and the sms/mms channel.  Time is a finite resource.

So, not only are we moving into new online and social media, we are moving out of pre-existing communication channels.

Spare us all the engagement and authenticity romanticism.  Spare us all the finger wagging and pious recrimination over brands being unable to demonstrate concrete ROI from social media.  It’s all either pseudo ethical or pseudo academic drivel.

The reason brands must market and engage in online and social media is that the customers they already serve are shifting their preferences as to how they will engage with all brands in future.  If a brand’s existing customers arrive in online and social media and find the brand they have been dealing with is absent, alternative brands with comparable offerings will take future market share.  End of story.  That’s why every media revolution is an opportunity for new brand start ups in mature consumer goods and services markets.

This always starts off sounding like a distant cry until marketing programs through traditional communication channels start showing reduced ROI.  By then, the damage is already being done.

It must have sounded like a distant cry in the early 1950’s when TV appeared on the horizon with few channels, limited broadcasting schedules, little content and small audiences.  I still remember watching the ‘test pattern’ as a kid while waiting for the screen to come to life in the early 1960’s. By 1979 there were 300 million TV set in operation.  By 2001 there were an estimated 1.75 billion TV sets worldwide.  The most notable observation we can make here is that the move into online and social media is much faster than was the revolution into TV.

TV broadcasting licenses and advertising must have seemed expensive and unsupportable investments for some time in comparison to radio, newsprint and cinema.  But look at how market share changed hands after the transition phase to TV got going, and look at the monumental consumer brands that were forged from advertising in the early years of television.  The curse is on the laggard.

That’s the catch with social media ROI.  During this transition phase between traditional, web 1.0 and web 2.0 communication channels, ROI in social media isn’t necessarily measured in new sales revenues.  It’s significantly measured in avoiding the loss of existing market share as existing customers shift their communication preferences to new media.

For new brands, it’s an opportunity to take share from established brands lagging behind in the transition.

If you decide to stay largely out of online and social media until clear evidence of ROI is on the table, you are making a mistake.  You’ll pay for it with lost market share.

The next phase of this revolution will be the competitive phase where the fight for market share will be between those who have entered social and online media.  Then we will see a more relevant and conventional assessment of ROI from within new media channels.

Until then, as the song says, “don’t count your money while you’re sitting at the table”…especially when other players are moving to new tables.

facebook: remember, if you don’t like it, you can’t participate.

Posted in social media engagement, social media marketing with tags , , , , , on October 12, 2010 by monozygote43

In recent months ‘We Engage’ has looked at dozens of companies marketing in facebook as a part of our initial complimentary reviews of company engagement. 

While our central focus has been to catalogue weaknesses in the scope, quality and velocity of overall brand engagement (including customer service and marketing), we are seeing several ‘wrecking ball’ issues that defeat efforts being made to engage and build the social network, no matter how brilliant  original promotional concepts may have been.

Two issues that come back to basic brand development and marketing ‘101’ are:

First, the number of companies that don’t require (I said require…not ask for) a ‘like’ in return for allowing participation in promotional offerings.

Always make sure that ‘liking’ your business page is a prerequisite to the customer or prospective customer being able to participate in any form of value based promotional activity.  That means, ‘like’ first or don’t participate.

While posting on a business page wall to discuss a brand may require a ‘like’ subject to the basic options in the facebook user interface, downloading/printing a coupon, an e-book, acquiring a unique reference number, or following a link from a wall does not necessarily require a ‘like’.  There are several different ways to make a promotional offer that are contingent upon receiving a ‘like’ in facebook.

For example, after creating special tabs for ‘offers’ or ‘discounts’, it is possible to include some simple code on the page for revealing the content of the page only after a ‘like’.  It is also possible to restrict the downloading or printing of coupons until the ‘like’ has been given. (see this example)

Please don’t forget, the purpose of the promotional effort is two-fold.  One is to put the customer in contact with your brand and to experience your product or service.  The other is to ensure that once the promotional investment is made, customers are accessible for additional offers and promotions.  Building the accessible network is a fundamental goal in all media including social media.  Each promotional event should widen your reach for each subsequent event and increase the potential for reference based participation.  This is not new.  The same principles applied to email and telephony and capturing the contact details of customers with paper coupons or gift cards at the point of sale.

Second, if your business has more than one facebook account (many franchise businesses, multi-brand, multi-product and multi-national businesses fall in to this category), make sure you have set precise standards for naming and logo usage.

Many significant organizations now have major ‘search ability’ and recognition issues in facebook because of variations in the way their page names are spelled or the failure to adhere to standard brand marks or logos…or both.  Call me crazy, but I thought we had supposedly put this one to bed when librarians worked out standard procedures for storing and recovering papyrus manuscripts in the libraries of Ancient Egypt.  If not, then certainly more recently in  libraries using index cards and microfiche (remember microfiche?).  Standard procedures for filing/cataloguing any thing, anywhere are not new.   The problem didn’t arise because of social media.

I look now at organizations like the Los Angeles Times and marvel at how some of their facebook pages (they have over 20) will only come up in a search titled “Los Angeles Times” while others will only come up in a search titled “LA times”.  Additionally, choice of logo seems to be a ‘free for all’.  These people are journalists for goodness sake.  If you catalogue and mark your page correctly (consistently), they will come.  If you don’t, you will be invisible and gather dust while sitting on the shelf.

Do any of these issues affect your brand?  If so, perhaps you should devote some time to reviewing the fundamentals of your engagement efforts in social media with ‘We Engage’.

Multiple Personality Disorder in Social Media.

Posted in social media with tags , , , , , , , on August 4, 2010 by monozygote43

There is no doubt; marketing and sales functions have arrived in social media.  My question is, when will brand management join them?  In some companies, as far as managing brand in social media is concerned, it really looks like the animals are running the zoo and the brands are running scared.

Look at Kia Motors America and in particular the campaign to promote the new Kia Soul van that includes a major Kia sponsorship of the 2010 Warped Tour.  Kia has a promotions tent on site at the tour venues.  Some Kia marketing genius decides to run a cool contest for fans to meet and greet Christofer Drew.  The problem is that the Kia promotions guy has the fans sucking muddy water from a filthy pool of old rainwater on the ground which is filled with garbage…first to fill a soda can with water sucked up by mouth from the pool…wins?

Watch the video  of the water sucking fiasco.

Drew responded on July 9th just before midday via twitter, accusing Kia of being “inhumane bastards” and saying he didn’t give a F&*% about his contract with them.  Nice right?  125,000 twitter followers and a very popular musician to boot.  Drew was pissed…but more importantly his fans and their followers on twitter were creating a new corporate villain in Kia Motors America.

All that money being poured into the valuable new buzz around their Soul van is being shot out of an open corporate artery by unchecked and reckless marketing techniques. Is there a brand management doctor in the house?  No doubt some several million people saw that tweet, and the re-tweets berating Kia Motors for being inhumane.  How many saw the video (before it went private)?

What did Kia have to say?  You got it…nothing. Since July 7th on their facebook PR account, there is nothing.  Nothing in twitter, and nothing at the Kia motors America website at the time of my writing.  Clearly they were talking to Drew in the extended world.  They needed to be talking in the social media because that’s where the damage was being done to the brand. Where was general management in Kia?  Marketing got them into this…who would get them out?  The Legal function did from the looks of what happened next.  Although, a ‘hear no evil speak no evil’ posture by Kia suggests the presence of old media Public Relations voodoo as well.  You know…wait it out and shut up.  Eventually, everyone will just forget it happened.

Some time on the 11th July, Drew deleted his tweet, but that’s like deleting a word file containing a draft of an email that was published to a few million people.  You can’t delete the memory…and the retweets are out there spread far and wide…and it was re-tweeted mercilessly.

If all this wasn’t enough, Kia are simultaneously running a series of advertisements with singing hamsters who are dressed ‘hood’ and moving to rap music by Black Sheep. Kia have chosen the hood and rap genre to drive the ’soul’ message around the new Soul van product.  Young, independent American men and women of moderate means are their target market.  I am very sure that includes African Americans.  At first glance the ads are clever and entertaining…but not everyone sees it that way.

Search twitter for ‘Kia racist’ and you will find plenty of people saying the ads are racist.  There is plenty of blog activity as well, and action in Kia’s own promotional web sites and comment sections.  People are tweeting and re-tweeting the racist claim and the idea isn’t going away.  Again, there is nothing from Kia PR in an official capacity.

It’s possible that the PR people at Kia also decided silence was the best response on the racism claims…but I’m going to wager they simply aren’t listening and they don’t have a policy for managing events like this.  Does the old “put your head down and just wait it out” policy work in social media?  Will the racism thing just go away?

I don’t want to buy into the racist claims one way or another, but Kia have another social media forest fire here…at least tall columns of smoke are rising.  Does someone need to respond quickly and provide gold plated assurances to the African American segment of the market?  It is pretty clear to me that the choice of the ads theme is actually a huge compliment to the music and the fashion that has been used, because Kia has selected it as the embodiment of ‘soul’.  Well, why doesn’t someone just say that…over and over again?  That would silence most critics.

The media savvy and ‘customer facing’ departments in large companies, including sales, marketing and public relations, have in many cases raced ahead of the remainder of the organizational phalanx to engage markets and customers in social media.  As a result, some have created company personas in social media that appear to be inept, unbalanced and unaware of larger issues relating to brand reputation, trust and after sales service.

In some cases, these companies just take a bad persona in traditional media and walk it straight across to social media.  The amplification and acceleration of social media on already weak branding creates a very negative message very quickly.

In the case of Kia Motors, a self-directing and autonomous marketing function could easily be considered a corporate “alter” that has effectively asserted control over brand behavior in the social media fulfilling all the symptoms of Multiple Personality Disorder (MPD…now DID).  It’s time for the rest of corporate functionality, and general management, to realize that social media is the future.  Privacy is dead, and marketing and sales can’t be the reigning personality of the company in social media.

See if you can recognize something here about companies you know in social media behave from this description of Multiple Personality Disorder (MPD) as an individual affliction:

Multiple Personality Disorder (MPD) is a psychiatric disorder characterized by having at least one “alter” personality that controls behavior. The “alters” are said to occur spontaneously and involuntarily, and function more or less independently of each other. The unity of consciousness, by which we identify ourselves, is said to be absent in MPD. Another symptom of MPD is significant amnesia that can’t be explained by ordinary forgetfulness. In 1994, the American Psychiatric Association’s DSM-IV replaced the designation of MPD with DID: dissociative identity disorder. The label may have changed, but the list of symptoms remained essentially the same”.

Working in social media requires crisis policy and procedure, together with standard procedures for response and standard protocols for elevating decision-making.  If social media doesn’t engage the full functionality of the organization, you may be leaving brand management in social media to an ‘alter’.

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