Corporate Eye

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Archives for February 2013

Yes, Your Customers Are Using Social Networking

social networking mobile iconsUnless your target consumer audience is over the age of 64, the majority of them are using social networking sites like Facebook, Twitter, and LinkedIn. In fact, 67% of online adults use social networking sites according to a December 2012 study by the Pew Internet and American Life Project, so there are few (if any) businesses, brands, or industries that can claim their customers aren’t online and active in social media.

Brands need to follow consumers. When consumers shifted from listening to the radio to watching television, brands had to follow them by shifting marketing budgets away from radio and toward television. The same thing is happening now, and budgets need to shift from television and other media to online advertising and social media marketing.

Research shows that shifting 15% of the marketing budget to online drives significant results in terms of brand awareness, recall, and reach. Couple those statistics with the data from Pew Internet, and it’s hard to justify not prioritizing social media ad spending. Take a look at the breakdown of social media penetration by age below:

  • 18-29 = 83%
  • 30-49 = 77%
  • 50-64 = 52%
  • 65+ = 32%

It also doesn’t matter how much education a person has. The likelihood that they use social networking sites is similar across the board:

  • Less than high school graduate = 66%
  • Some college = 69%
  • College+ = 65%

Furthermore, household income makes little difference in social networking usage:

  • Less than $30,000 per year = 72%
  • $30,000-$49,000 = 65%
  • $50,000-$74,999 = 66%
  • $75,000+ = 66%

The only demographic characteristics that showed a significant difference in social networking penetration were urbanity where 70% of people who live in urban areas and 67% of people who live in suburban areas use social networking sites versus just 61% in rural areas. Of course, rural areas have less internet connectivity, so this statistic really isn’t surprising. The one area that might surprise you is gender. According to the Pew Internet research report, 71% of women use social networking sites but only 62% of men use social networking sites.

A few more interesting statistics from the Pew Internet study follow:

  • 40% of cell phone owners use social networking sites on their phones.
  • 67% of online adults use Facebook.
  • 20% of online adults use LinkedIn.
  • 16% of online adults use Twitter.
  • 15% of online adults use Pinterest.
  • 13% of online adults use Instagram.
  • 6% of online adults use Tumblr.

It’s hard to believe in 2013 that some brand marketers still have to fight to gain social media marketing budget dollars against executives who claim, “Our customers aren’t using social networking sites.” Next time you face that road block, cite some of these statistics. The question in 2013 shouldn’t be, “Who is using social networking sites,” but rather, “Who isn’t using social networking sites?” Unless your target audience is part of that 33% minority, your customers are using social networking sites, and your brand should be there, too.

Image: Social Media HQ

IR: Keeping Up To Date

BASF, an industry leading chemical company, has a new way to keep Investors informed of the latest additions to their corporate web site. By simply selecting ‘New on the Website’ BASF investors can see an overview of the latest updates from the BASF Investor Relationship team.

Not only does this provide an easy way to keep Investors up-to-date with the latest news at BASF, it also provides quick access to other information located on the page, such as links to BASF shares and key financial data. By doing this, BASF increases visibility and improves accessibility to key locations on their web site that Investors might otherwise overlook.

This innovative website practice is an example of how a simple addition to any web site can make a big difference.

Five levels of corporate citizenship

One of the blogs I keep my little beady eye upon is “Civilising the Economy” by Marvin Brown, professor of business ethics at the University of San Francisco.  You can get  a measure of the man and his writing from the blog’s strapline:

My goal here is not to think outside the box but change the box we think in.

Anyway, a recent post he’s put up is about developing a new course on the ethics of social transformation from a global citizen perspective.  Whilst not directly linked to them, I thought it would be useful to share the several levels of citizenship he identifies and discuss them from the business and corporate citizenship perspective.

As we’ll see, the gap between business and global citizenship sharing the same bench is wider than you might think.

[Read more…] about Five levels of corporate citizenship

I’m All Ears: The Importance of Online Listening

Online “talking” has long been synonymous with online presence. Since the rise of social media, it’s been blogs, tweets, and posts that have been the indices of choice when it comes to  Social Media analytics.

But what about online listening?

Online listening has taken a backseat to online voice. In fact, online listeners have even garnered the derogatory label of ‘lurkers’ and “freeloaders who leech the energy of online communities without offering anything in return”.[1]

This situation is in contrast to general social norms, which indicate that dialogue is composed of two elements: talking and listening. So, if listening and talking go hand in hand, then why should listening continue to be left out of the equation in cyberspace?

Recent academic discussions have finally turned to the emerging importance of online listening for those corporations that recognize social media value.[2]

Psychology of Listening: How Listening Forges Customer Bonds.

Regardless of whether it is through traditional conversation, or conversation through blogs, forums, mailing lists, RSS feeds, etc., the act of listening is the most effective way to bond with the customer. It builds trust, allowing corporations to prove their credibility to their target audience. Listening also shows respect, empathy, and support for the customer. It also allows for vital exchange of information.

So, Why Aren’t Corporations Listening Effectively?

Many corporations side step the extensive time commitment of social media engagement by hiring outside contractors to tweet, post, comment, etc. on behalf of the corporation. While outsourcing social media talking is quite simple, it is very difficult to do the same with social media listening.

Corporations often rely on contractors or unmotivated and non-compensated employees to engage in online listening. This method, however, is ineffectual as it reduces social media dialogue to mere unidirectional marketing communication. This impersonal approach squelches the benefits of intelligent listening, or listening conducted by someone who is deeply invested in the company.

By outsourcing social media communication, corporations are missing out on the value-driving benefits of online listening. Online listening has been likened to a giant focus group,[2] with benefits that include the following:

  • Corporations that listen are viewed as an approachable member of a community
  • Customer opinions, questions, and concerns are brought to the forefront
  • By communicating with customers in real-time, swift and accurate customer support becomes possible
  • Reduction in the high costs associated traditional customer support models (i.e. telephone)
  • Corporations gain a global view of how the brand is discussed
  • Patterns of customer use and satisfaction are easy to detect
  • Enhanced public personae

Take Dell for example. Dell has fully embraced social media, including the practice of online listening. They have appointed a Vice President of ‘Communities and Conversations’ who acts as a strong advocate of online listening. Bob Pearson, who currently fills this role states:

“Quite frankly, one of the most important things we do with Twitter is listen’, Pearson goes on to argue, ‘I don’t think you can hire someone to listen for you.“[3]

Thus it is important for corporation to choose their ‘listeners’ carefully. Individuals who are invested in the success of the corporation, and who support its values, goals, and mission should be the ones to fulfill the important task of social media communications. These types of individuals will be motivated to listen to the customers, and connect with them in a way that drives user engagement, which will subsequently drive profit.

Remember, the cardinal rule of listening is reciprocity – if you listen to your customers they are much more likely to listen to you and consider the benefits of your product.

References

NOTE: the general idea discussed in this article was adapted from the article Following You: Disciplines of Listening in Social Media. Published in 2009 by  Kate Crawford

[1]Kollock & Smith (1996): Managing the Virtual Commons: Cooperation and Conflict in Computer Communities
[2] Crawford (2009): Following You: Disciplines of Listening in Social Media (PDF)
[3] Soller (2009): Twitter Unmasked. Newsweek Online

Shifting 15% of TV Ad Budget to Online Leads to Higher Reach and Brand Recall

calculationA new study by the Interactive Advertising Bureau (IAB) and Nielsen provides strong evidence that shifting television advertising dollars to online advertising drives positive results.

In “A Comprehensive Picture of Digital Video and TV Advertising: Viewing, Budget Share Shift and Effectiveness,” it is reported that a 15% shift in media spending away from television and toward online drives increases in brand recall, reach, and the effectiveness of that reach.

Furthermore, combining online advertising with television advertising drove even better results. Online video ads that run before television ads lead to a 33% increase in brand recall over television advertising alone. Online display ads that run before television ads drive a 25% increase in brand recall. In other words, timing your media buys so consumers see your messages online before they see them on television is an important piece of the puzzle when it comes to increasing returns on your advertising investments.

Some of the key findings from the study include:

  • When 15% of ad spend is shifted to digital from television, consumer packaged goods brands (CPG) experienced a 3.4% increase in reach.
  • When 15% of ad spend is shifted to digital from television, non-CPG brands experienced a 6.2% increase in reach.
  • When 15% of ad spend is shifted to digital from television, brands experienced more reach at lower costs per point ($63.0K vs. $67.6K) and CPMs decreased ($12.31 vs. $13.82).

The report also reveals statistics specific to online video advertising that can help media buyers make the right choices for brand advertising. For example, ads shown during full-episode online video content generated a 39% higher brand recall than ads shown during full-episode programs on television. In fact, digital ads shown during both short-form video and full-episode video content drove higher brand recall, general recall, message recall, and ad likability than television ads.

And despite what you might think, ad receptivity is quite good no matter when an ad is played with online video content. Here are the overall findings related to online video ad receptivity:

  • The average streaming video viewer watches ads for 20 seconds. The average completion rate for these ads is 87%.
  • Mid-roll ads generate the highest completion rates (99% for short-form video and 89% for long-form/full-episode video).
  • Pre-roll ads generate the second highest completion rates (79% for short-form video and 81% for long-form/full-episode video).
  • Post-roll ads generate the lowest completion rates (71% for short-form video and 79% for long-form/full-episode video).

You can follow the link to view the complete report, which makes a compelling case for shifting up to 15% of your media buying budget from television to online, particularly online video, and for modifying the timing of your ad runs.

Image: Ayhan Yildiz

Media and Careers : Tweeting Peers

Centrica, an industry leader in integrated energy, has created Twitter pages for their recent graduates, inviting them to Tweet about their experiences at Centrica. Risky? Possibly, but also an extremely effective web site practice. Here’s why:

First, this will attract potential recruits, as they will appreciate seeing the ‘human side’ of Centrica. Also, they will directly identify with Tweets written by their peers, as opposed to a general corporate Twitter board offering generic Tweets from an unknown source. This eliminates all suspicions of bias, and offers potential recruits a much-appreciated window into the Centrica experience. This enhances their trust in the company while simultaneously piquing their interest in the Centrica programs.

Although allowing recent graduates to Tweet about their Centrica experience exposes the company to the possibility of negative media, the benefits far outweigh the risks in this innovative web site practice.