Category Archives: Social Media

Kellogg Panel on the Future of Marketing Misses Impact of Social Media

Last night I went to a panel discussion on “Perspectives: The Future of Marketing” hosted by Kellogg Graduate School of Management as part of their centennial celebration. Alumni from MTV, AMEX, The New York Times and Google, the kind of media/advertising/finance panel you’d expect in New York, gave their insight on the big trends:

  • Stephanie Ruyle, VP of National Accounts at MTV talked about how the DVR has pushed them to focus on “integrated marketing” (getting placement and sponsorships during the actual programming because users are fast forwarding through the commercials).
  • ”Mobile,” was the one-word trend of the future offered by Bill Sickels, Head of Healthcare at Google. He pointed to the proliferation of smart phones and massive increase in traffic from these devices in the last year, as well as the fact there were three times more mobile devices than PCs and laptops combined as things that will fundamentally shift how marketers communicate.
  • Also insightful was Deborah Curtis, VP Advertising from AMEX, noting today’s marketing execs grew up in a “TV generation” that responds to visual cues whereas the “digital generation” consumes so much more data, and respond in a very different way, which will force marketing execs to re-train how they communicate with consumers.

What really struck me, though, is that none of the panel really discussed at length how social media was going to change things for marketers. Yes there was the discussion of the dual challenges of hyper segmentation and monetization; the need to learn a new lexicon and modify your brand voice; and social media as a huge focus group. But to me social media means a much more fundamental change is coming to marketing.

For example, fellow alumni Erica, Jeff and I were surprised no one talked about how marketers are losing more and more control of their brand and product because today consumers expect to have input. To borrow a bit from social monitoring company Radian6, a company’s brand is no longer something controlled and disseminated by PR and the marketing executive team. Your brand is the “sum of all the conversations” about your brand. That’s a huge fundamental shift for traditional marketers.

Consumers are not shy about giving their opinions about your brand and social media like Twitter and Facebook make it that much easier to make your voice heard and find others that share your frustration or opinions. AMEX noted they learned more this year by really listening to their user base. MTV does really cutting-edge guerilla research to get to know their users (like asking users if they can video tape their closet or putting users in a “MTV deprivation” house for 30 days to see how they respond) but they said they continue to “follow” their demographic where they are going, while it struck me they should be having a conversation about where they are going together.

What is true for the brand marketer is also true for product marketing: including users in the design phase and getting their buy-in early-on in the process is critical. Even social media giants who by their nature should know better somehow forget to include their customers in the product development process (see Facebook changes in their terms and conditions forcing them to let users vote and the recent user “#fixreplies” backlash by Twitter users after the company made changes in reply functions).

Integrating customer input into the product development cycle is potentially easier in the web environment where development cycles are weeks and months (versus traditional products which can take one to three years). While at Power Soccer, giving our core users access to the beta of a new version of the game really helped us hone in on issues and things we needed to get right for our users. Once the new version of the game went live, we were able to listen to our users in our forums and on our Facebook Fan Page to understand where other issues were cropping up, huddle with the product team to come up with a series of fixes, and diffuse issues by communicating to users a clear roadmap of new changes we would make to address their concerns. But even some of these late fixes could have been avoided with better input from end-users in the design phase. There is always room to optimize and improve.

I think the exciting yet challenging thing in the “future” for marketers is that there is a new groundswell of user conversations happening that we need to get our arms around – how we tap into it, shape it, and leverage it to make better products and enhance our brands. Wednesday’s panel discussion only made it more clear to me that many traditional marketers are only beginning to grasp that the future is now.

Other Tidbits

  • The New York Times notes in research on influencers that it was interesting how similar demographically the users are, even across different cultures and countries. They are all curious, tell others what they think, well educated, optimistic, heavy news and information consumers and influence about 5-10 people
  • Google shared that there were 15 hours of content being uploaded every minute on YouTube
  • On CMO turn-over, the concensus was that marketing was still proving itself to be C-worthy in the eyes of a lot of organizations and that success relied heavily on an organizational culturally valuing marketing

How Facebook Avoids Being the Next AOL

Facebook status lines and Twitter’s Tweets are the current behemoths in allowing users to start a conversation with friends, family, colleagues and strangers. On a very simplistic level, they almost act like a contact management system, like Outlook with a broadcasting feature. For all the growth, social sites and Twitter are being co-opted into dashboards (like TweetDeck and seesmic), allowing users to filter, follow and interact with their multiple circles of friends in one place.

Facebook has clearly seen the writing on the wall, working closely with these dashboard providers to ensure they are integrated, and focusing their efforts in leveraging the huge network of users in other ways – namely via Facebook Connect (tying users activity outside of Facebook back into the friend feeds, ensuring you don’t need to leave) and the recent news reported by Eric Eldon at Venture Beat about a new payment system (http://venturebeat.com/2009/05/11/facebook-to-test-virtual-currency-with-developers-in-a-few-weeks/).

If Facebook follows through and launches a payment system using a virtual currency (like credits) that is as easy to integrate into other sites ala Facebook Connect, it not only succeeds in making payments simple and moving towards profitability, but provides Facebook a chance to avoid becoming the next AOL (a company that defines a space but then gets left in the dust once the walls come tumbling down).

KFC, Oprah and Social Media – Measuring the Viral Echo

Once KFC finally succumbed to the onslaught (and possibility of running out of chicken and losing it’s work force if they had to face more angry mobs looking for a free meal) by giving people rain checks, the mainstream press seemed to place the root of mania squarely at the feet of Queen of All-Media Oprah (see Reuters – not a mention of Twitter, Facebook or any social media.). No disrespect to Oprah (even though she only ranks sixth in the celebrity social media rankings), but how much of the “overwhelming response” was due to social media?

And there’s the rub – how to measure the impact? So here are a couple stats that are out there:

  • The day the coupon roared: @gouldliz shared HitWise’s graph showing KFC’s visits jumped 1600% from 5/4 to 5/5 (http://twitpic.com/4qjwb), representing 0.025% of US web usage.
  • @adamb_nyc noted that Vitrue’s Social Media Index shows KFC rose 21% from 5/3 to 5/8 across the Twitter, Facebook, blogs and other social media (http://tinyurl.com/oga68x)
  • Facebook Lexicon shows the clear peak on May 5th (see graph below)thanks to the Oprah-driven KFC promo. When looking at Oprah, the previous high-water marks were March 13th when Facebook’s CEO Mark Zuckerberg was on the program and November 5th of last year when she had a post-election day celebration special. In fact, Oprah has consistently been below KFC on Facebook since the inception of the data. Oprah may have over 4 times as many fans to their official Fan Pages, but people on Facebook are more engaged talking about KFC in their daily lives, as you would expect given the demographics.

Facebook Lexicon shows KFC regularly posts more mentions than Oprah, plus the impact of the Grilled Chicken coupon promotion on May 5th

Luckily, to see what Facebook can do without Oprah starting the conversation, KFC had another recent chicken give-away promo: On April 27th, KFC gave away one piece of its new grilled chicken just for asking – not a whole meal, and no coupon involved, but clearly a chicken give-away (I actually went that day: the lines were pretty normal at lunch time and the clerks didn’t offer up the chicken unless you asked for it).

Up to that point, this was the biggest blip to KFC’s stream on Facebook. Eye-balling it (by measuring the pixels in the height of the graphs), I’d estimate about a 20% increase in Facebook mentions for what I believe was a mostly TV-based ad campaign. Also, you can clearly see the mentions slowly growing virally over the weekend (I’m not privy to the ad buy, and given the Google Search trends showing a similar rise, you might call the Facebook mentions as the “viral echo” of those TV ads) .

In comparison, I estimate the Oprah-driven campaign two weeks later saw a 170% increase in the Facebook mentions for KFC on the peak day and it was immediate – no slow build here. Whereas the Oprah promo drove long lines and “millions” of free chicken dinners were given away, the company said little I can find about the success of the April 27 promotion and while I saw plenty of friends mention and talk about KFC, there were no faux riots.

Ultimately we have an apples to oranges comparison here (one piece vs. a meal, launching via TV ads vs. The Oprah Juggernaut), and we are lacking insight and metrics (at least publicly available) that connect coupon downloads from Social Media mentions, but I think there is no question that the “viral echo” for KFC was huge and velocity is something marketers have to now factor into their equations.

We’ve gone from Offer + Promotional Vehicle = Action
to (Offer + Promotional Vehicle) * Social Media = X * Action.

The question that remains is what is X? Only more testing with similar offers and media will tell, but I believe the “KFC debacle” is a watershed moment, making marketers aware of Social Media’s multiplier effect and the perils of not paying attention to it (or your customers). The fun part as marketers is figuring out how we optimize that equation, both in terms of results and what our organizations can handle.

Have more metrics to add to the conversation? Let me know!

Other fun notes

  • From the Lexicon graph above, you can see KFC got a slight increase in their baseline Facebook mentions on March 21st, the day they launched their Twitter account.
  • KFC got a bump as big, if not bigger, than American Idol’s showing on a weekly basis http://is.gd/yQOM)
  • Google Trends shows Oprah and KFC have nearly the same search volume over the last month — maybe they ARE soul mates?
  • KFC’s official Fan Page, with 174,500 fans, falls behind two dormant Fan Pages with 997,000 and 441,000 fans. C’mon brands, get with the program and take charge of your brand!