This is it…the Season Finale! And, what a way to end Season 2 of (R)evolution….

In this episode, Yamaha shares what is by far the most expansive view of disruptive technology’s impact on business infrastructure and culture on the show to date. What you’ll see is a genuine discussion with Jeff Hawley and Rick Williams of Yamaha explore how an already successful business is exploring new opportunities to better define the customer experience before, during and after transactions. It comes down to workflow. Nowadays, it either works for you or works against you. Here, Yamaha shares that it needed “to blow up” its existing systems and processes and “start over” to compete more effectively for the future.

I think you’ll enjoy Yamaha’s approach to listen, learn, and engage with customers in their channels of preference. Please watch and share!

Season 2, Episode 16

This episode was recorded during the Salesforce Social Advisory Board meeting in San Francisco. Participants included brand managers from the likes of Disney, Livingsocial, P&G, Nissan, SunTrust, Dunkin Donuts, Get Satisfaction, and VW, we address the need for businesses to not only react to conversations but also lead them.

Season Two:

S2E1: How Mercedes Benz Successfully Uses Social Media to Engage
S2E2: Technorati’s Richard Jalichandra on the State and Future of Social Media
S2E3: Guy Kawasaki on the Art of Enchantment
S2E4: Adly CEO Arnie Gullov-Singh on the Social Era of Celebrity Endorsements
S2E5: Filmmaker and Webby Awards Founder Tiffany Shlain
S2E6: Jim Louderback, Revision3 CEO on the Future of Broadcast and Web Television – Part 1 of 2
S2E7: Jim Louderback, Revision3 CEO on the Future of Broadcast and Web Television – Part 2 of 2
S2E8: Marcel LeBrun of Salesforce Radian6 on the Future of Social Media Monitoring
S2E9: Our Digital Society in the Next 30 Years: An Interview with John Battelle
S2E10: How Social Customer Service is Changing the Culture at Comcast
S2E11: Dunkin’ Donuts Uses Social Media to Improve Customer Relationships and Experiences
S2E12: USA Today’s Jon Swartz on Disruptive Technology’s Impact on Business and Culture
S2E13: Ford’s Jim Farley on the importance of putting your brand in the hands of customers
S2E14: How Suntrust Uses Social Media to Engage Customers and Comply with Regulation
S2E15: Nissan Embraces Social Media to Improve Customer Experiences and Foster Advocacy

Season One on YouTube

Now on iTunes!

As I think about disruptive technology, it’s clear that as an industry, we often get stuck in conversations about products, services, and features. In social media for example, we are enamored with Twitter, Facebook, Foursquare, and the like. At the same time, we tend to confuse emerging with disruptive technologies and overly invest in rising stars such as Instagram, Quora and to some extent Google+ before we understand the impact they have on our world and the impact we can have within each network.

Why does this matter?

As an analyst and as a geek, I too am captivated by all that’s new and shiny. I’m grounded however, by the real world conversations and actions necessary to translate trends into actionable insights. Innovation must be studied. Its impact must be understood. The benefits offered by disruptive technology must be analyzed to learn how it will benefit our business, whether its effects are of value to the business or market infrastructure, in customer and employee relationships, or in product or process breakthroughs. It’s not enough to experiment. While test and learn is a necessary ingredient in converting innovation into progress, it is in the recognition of opportunities where we need to begin. We need to start with a hypothesis or an idea about how technology plays a part in evolution and more importantly, how it allows businesses to realize its objectives better than it does today. It then takes research and experiments to prove or disprove your theory.

In addition to a culture of innovation, experimentation, and one that can recognize new opportunities, the future of evolution comes down to you and your leadership team.

I recently had the opportunity to join Steve Woodruff and Lisa Petrilli in their popular #LeadershipChat forum on Twitter. We discussed why this is the time where business as usual is no longer an operating model. We also dove into the importance of translating trends into opportunities to either lead or help leaders chart a new course. We indeed face an era of digital Darwinism, a phenomenon where technology and society evolve faster than our ability to adapt. This is a time for reflection and adaptation. In the words of Charles Darwin, “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change.”

In 140 characters or less, here are some of the highlights of the discussion…

This book (The End of Business as Usual) marks a departure from your past writings. In what way(s)?

- Social media is disruptive in how people communicate, discover & share. It is not a catalyst for leadership enlightenment #LeadershipChat

- To earn the attention of C-Level executives takes understanding, tenacity + ability to translate trends into opportunity

- Social media is only part of the story. The lessons many are just now learning are not unlike those who’ve focused on change

What’s advice re 1st step for a company to translate what see/know into actionable insight?

- My Advice? Stop focusing all of the $+resources on monitoring keywords & put someone from BI on analytics

You see the “connected consumer” as a major driver of change in business. Why and how?

- The connected expand opportunities. They don’t follow the steps of other consumers. They influence + are influenced differently

- We have 3 distinct groups of consumers & how they discover/communicate changes w/each – traditional, online & connected

- Connected consumers are just that…connected. How they find & share information and make decisions is not like the others

- The connected represent a wave of new consumerism & require businesses to rethink & amend its approach to reach & lure them

How can businesses most effectively attract and interact with the “connected consumer”?

- Some believe that consumers don’t know what they want. If we listen to them, we react vs innovate, which = meh products

- Steve Jobs once said “You‘ve got to start w/the customer experience & work backward – not the other way around”

- Consumers are becoming connected & influential. The opportunity is for businesses to architect exceptional experiences

- From marketing to sales to service to experience, businesses must think about defining meaningful + shareable experiences

- People will always talk, whether they’re connected or not, so give them something to talk about. Every consumer group wins!

What will it take for leaders to adapt to – and lead – the new climate and culture of business?

- Quests toward customer-centricity follow 2 paths. 1) Get closer to customers thru social. 2) Create a customer culture

- Leaders often talk about transformation, change or vision much like politicians address the needs of people during election

- Leadership is earned. It’s not a right…it is a rite of passage. Leaders must see what others don’t & do what others can’t

- There’s a drought of useful information-that’s OUR opportunity. We must translate what we see/know into actionable insights

- Change happens when persistence outlasts resistance & it is also your opportunity to become part of the new leadership team

You talk adamantly about vision, higher purpose and mission, where’s the ROI in that? Is that what CEOs really want?

- What’s the ROI of vision or innovation? Often ROI stands for Return on Ignorance, which as you can imagine is usually low

- If you ask an exec what they truly want, the answer will vary across the board-profits, sales, efficiencies, happy employees

- I spent a lot of time w/@zappos Tony Hsieh. He once told me businesses excel if they focus on higher purpose vs bottom line

- I researched it & companies focused on purpose, mission, experience tended to over index in satisfaction, profitability, etc

- Leaders don’t chase trends, they seek results. This requires customer engagement + experiences & leads to mission/innovation

You can read the full transcript over at Hashtracking.

Order The End of Business as Usual today…

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The following report is brought to you by the Pivot Conference taking place in New York on October 15-16, 2012. You can download a full copy of the report for free by clicking here.

At the end of 2011, Social marketing stands at a profound crossroads. Some organizations are finally embracing the importance of social networks and, as a result, increasing investments in creative engagement, marketing, and service programs. Others see the future value, but lag behind in execution. At the vanguard, Social Businesses drive a virtuous cycle of discovery: Their successes in Social marketing lead to new data, which lead to insights, which lead to new and more effective programs as well as the business systems and processes necessary to improve internal and external collaboration.

In 2012, social media marketing, driven by these innovations, will only continue to mature. Bottom-up learning about what really works in Social will be essential for this expansion. Research conducted by IBM in 2011, for instance, revealed a gap between consumer expectations toward the businesses they support in social media, and executive assumptions about what these consumers wanted. This “Perception Gap,” as defined by the IBM study, demonstrates the importance of bottoms-up, informed social marketing programs, as opposed to the traditional top-down strategies tied to the usual monologue-marketing channels.

Not all customers are created equal. So, businesses are learning that there must be more than one approach to reaching and engaging customers through the emerging Social channels.

This year, at the second annual Pivot Conference, we explored the evolving landscape for consumerism as colored by the emergence of Social Consumers. Brands, agencies, academics and thinkers examined how Social Consumers find and share information, how they influence and are influenced by engagement, and also how they make decisions. In the end, it was clear that the Social Consumer is fundamentally unlike a traditional consumer and, as such, compels brands to rethink sales, service, and marketing strategies across social, broadcast, and mobile networks. At stake is a business’ relevance to the Social Construct, which is the new key to consumer connection and success. For brands today, if you don’t establish this connection, Social Consumers will just connect themselves and collaborate without you.

To help brands more effectively plan for improving customer engagement and experiences in 2012 and beyond, the Pivot team, along with The Hudson Group, surveyed 181 brand managers, agency professionals, and experts. Their answers paint a picture for how businesses intend to reach their Social Consumers. Additionally, the results serve as a benchmark as you, the Social Business leader, assemble your strategies over the next year.

The Rise of the Social Consumer

Who is this Social Consumer and how does he or she differ from traditional counterparts? Let’s start with a working definition. A Social Consumer is someone who first goes to their social networks of relevance to learn about products and services. Though somewhat influenced by their overall social graphs, Social Consumers emphasize the input of those who define their interest graph – like-minded individuals on any given subject who share common interests and experiences with them. In this way, Social Consumers evaluate the shared experiences of those they trust, and expect businesses to respond to their socialized questions. As a consequence, Social Consumers don’t follow a linear approach through the classic ‘interest to intent’ funnel during their decision making process. Rather, they follow an elliptical pattern where their next steps are inspired by the insights of others, and their experiences are, in turn, fed back into the cycle to inform the decisions of others.

Reprinted from The End of Business as Usual, Chapter 14

In the Pivot study, we asked if participants had a clear picture of who their Social Consumer is. An astounding 77 percent said yes.

Comparing these results to the working definition presented above, which survey participants did not review in advance, as well as the Perception Gap produced by IBM, I wonder how these numbers would change if the question was asked now. Given the results noted below, it appears that respondents believe they know who their Social Consumers are, even though they may not have actually engaged them in a detailed conversation.

When the Pivot team explored specifically if respondent organizations asked Social Consumers what they expect from engagement, most responded, “No.” This is intriguing because we have 77 percent of organizations who say they know what their Social Consumers want, but 53 percent haven’t really asked. They do not—cannot—really know how to deliver value in social and mobile networks, thus pointing to IBM’s Perception Gap. On the other hand, 35 percent did note that they asked Social Consumers about their expectations. Our belief is that these organizations will most likely outperform organizations that did not ask.

Businesses shared their perspectives on the benefits and customer expectations of social engagement in their responses to the survey. The results cover a wide spectrum of sales, service, and marketing benefits, with customer service, insight to make decisions, and the ability to learn about new products as the top three entries. Deals and rewards came in fourth and fifth respectively. Each of the benefits is important, however. Offering exclusive content, the ability to provide feedback for improvement and social commerce add to the complexity of reaching and engaging the varying needs of social consumers. We think marketers should look here at the whole tapestry, more than the individual strands.

When asked about the gender of the Social Consumer, respondents believe their Social Consumers are equally divided between male and female. This is result is intriguing for many reasons, not least of which is the findings in previous studies that females skew higher across popular social networks such as Facebook and Twitter, as well as for most social commerce services. Are we seeing the emergence of more men in social networks? Perhaps.

As we continue to examine the demographic makeup of Social Consumers, this study indicates they tend to be most commonly in their 30s and 40s. But there are strong showings of Social Consumers distributed across those 26-30, 46-50 and also 51-55. Clearly, social is no longer the province of just the young.

The household incomes of Social Consumers are scattered across the board. But in aggregate, it appears that Social Consumers lean toward desirable income levels. Median income from the study results is just over $60,000.

When asked which networks are frequented by their Social Consumers, participants stated that Facebook, Twitter and LinkedIn were numbers one, two and three respectively. Facebook and Twitter are viewed as essentially ubiquitous. At the time of this survey, Google+ hadn’t yet opened up brand pages, but as of November 2011, businesses can develop official brand presences. Yet, even without the ability to do so during the survey process, businesses recognized the important role Google+ plays in the lives of their Social Consumers

When it comes to Social Consumers’ increasingly common mobile activity, Facebook and Twitter still maintain the top two spots. Foursquare, though, jumps into the third position ahead of LinkedIn, an indication that geo-location networks continue to rise in popularity.

Pleased To Meet You, I Hope You Get My Game

Gamification is becoming part of social networking, education, and loyalty programs due to its attractiveness to the Social Consumer.

Zynga is currently the overwhelming leader in capturing the time and attention of Social Consumers when it comes to gaming, probably a reflection of Facebook’s current dominance. Intriguing here is that the second most common response is “other,” a sign of the diversity in this arena.

Social professionals don’t see a clearly dominant player amount the many current portable photo networks available for popular smartphone platforms. No option received even 25 percent of the responses. However, Hipstamatic is firmly positioned at the top of the list with almost double the usage of Dailybooth, which currently sits at number two, according to respondents. They seem to be leading a rather open field.

In the world of social and group-based deals, Groupon ranks number one among Social Consumers, but LivingSocial maintains a strong foothold in the number two spot. Facebook Deals was in third, but the service has since been discontinued by Facebook.

“After testing Deals for four months, we’ve decided to end our Deals product in the coming weeks,” Facebook told Reuters in a statement published in August 2011, during the time the survey was already in the field.

Engagement is not defined by conversations. Engagement is the act of a consumer and an organization or brand interacting within the consumer’s network of relevance through a combination of conversations, content, or related information. Engagement, and here’s the important part, is then measured by the takeaway value, sentiment, and resulting actions following the interaction.

Brands largely disagree with the belief that conversations in social networks alone drive meaningful business outcomes. The true test, of course, is whether or not outcomes are defined and if they are introduced into engagement as a desired click path. On the flip side of the coin, brands either completely or mostly agree that conversations help with brand lift and relevance responding with 51 percent and 45.5 percent respectively.

There’s notable difference, however, in whether or not brands think their Social Consumers want something of tangible value in exchange for a social connection. 21.6 and 45 percent completely or mostly agree. 27 percent and 6 percent mostly and completely disagree. Our advice: When in doubt, ask.

With all of the fanfare around social media, it would be easy for those living within the new marketing paradigm to assume that social media already was or soon will be mainstream within the organization heading into 2012. However, respondents were divided in their outlook. Just over half believed that social marketing is already mainstream within their organizations and just under half think that social marketing will still be experimental a year from now. This shows where we are in the social revolution: the reality of change is broadly accepted, but norms about fundamental issues still remain elusive. We know we are going to a new place, we just aren’t yet sure exactly where and how fast.

When asked what was preventing the organization from moving beyond experimentation in social marketing, respondents’ reasons were widely distributed. Budget was seen as a challenge, as was the inability to define or measure clear outcomes. We feel that, whatever your personal sense, each of these points is worthy of exploration and definition within the organization. This is the only way to ensure that the needs of Social Consumers do not go unmet. A working strategy and understandable benefits are critical to rallying support across the organization, especially among executives. Defined metrics tied to thoughtful strategies demonstrate progress. Listening combined with research will reveal the need for a cross-functional approach as data always spotlights the varying needs of Social Consumers – beyond marketing.

Confusion reigns today, but conviction lies on the horizon. 2013 is the year a solid set of respondents sees social marketing finally breaking beyond experimentation within the organization. Still, we can see the current uncertainty about the development of social: 15 percent look to 2014 as likely year for corporate breakthrough, another 15 percent see 2015 or later, and a sobering 35 percent still don’t know what to think.

While respondents see social marketing as crossing into the organizational mainstream relatively soon, an overwhelming 89 percent of participants see social marketing as a permanent series of experiments. The takeaway here is that professionals, for the foreseeable future, feel that there is much to learn with regard to the Social Consumer and how to effectively engage and steer positive experiences and outcomes for social marketers. As one area of social moves into the mainstream, it will just open up new areas for experimentation.

The trend in social media budgets is positive. The percentage of respondent companies spending less than 5 percent of budget on social drops by about half between 2011 and 2013 and the percentage spending over 50 percent more than doubles. The sweet spot hovers around 25 percent of budget, rising slightly over the next two years. All this indicates to us is that it remains early days in the development of social in organizations.

Looking ahead to 2012, brands are thinking through goals as they plan next year’s social marketing programs. At the top of the list, at almost 100 percent, is the need to increase sales, which is a reflection of the need for marketers to demonstrate tangible ROI. Consumer engagement, lead generation and brand lift are also atop the list. Among the notable responses from participants, influencing consumer behavior is at just over 60 percent, establishing points of influence at just under 60 percent, and discovering points of relevance shown at 40 percent spotlight how new touchpoints will play a role in driving desirable outcomes and experiences. The overall sense of the responses is a tilt away from “soft” benefits toward harder edged benefits that drive the bottom line.

Surprisingly, improving customer service and support was toward the bottom of the list, but it is promising to see that the research does show that businesses are placing it in the upper half of 2012 planning. We see customer service as one of the potential breakthrough areas for social networks.

Make the Pivot

Here’s the important takeaway: To successfully reach the Social Consumer and ensure that social media extends across the organization, look at this list as a series of steps rather than a hierarchical rank. Thinking through each item will force a more thoughtful approach to reaching Social Consumers and guiding positive experiences and outcomes. Budgets and support are the net benefits of following these action items.

1. Increase understanding of the benefits of the Social Construct within your organization.
2. Develop a clear strategy for social.
3. Define outcomes.
4. Tie strategies and supporting metrics to business objectives.
5. Earn executive buy-in with data, demonstrate the needs of Social Consumers, and show how others are successfully engaging them today.
6. Earn support across departmental functions by showcasing how the varying needs of the Social Consumer are unmet by key roles in the organization.

As you review these data and compare them to your 2012 plans, or if you’re in the planning stages now, remember that benchmarking against peers is only one part of the process. The real opportunity lies among your Social Consumers by identifying their needs, and benchmarking them against your solutions for them and thus your business opportunity.

Connect with me: Twitter | LinkedIn | Facebook | Google+

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Part 13 in a series introducing my new book, The End of Business as Usual…this series serves as the book’s prequel.

These days, customer service seems to be a contradiction of words and intentions. Year after year, customers are appealing for attention, efficiency and a communicated sense of being appreciated. After all, what is the value of customer acquisition if retention itself isn’t valued? Now with social networks becoming the preferred channel of communication among connected consumers, businesses are losing ground and faith. The reality is that customers will share their experiences whether positive or negative and they will influence the decisions of others. The question is, how are you changing your service model to shape and steer experiences that deliver value to customers and also back to your business?

Social networks are emotional landscapes that are populated by human beings, not consumers. It is for this reason that many existing customer service approaches to social networks are the equivalent of the tips of icebergs we see above water. The real opportunity lies underneath the waterline and as you can imagine, it is beyond formidable. As part of this special series, my good friend Frank Eliason decried that social media customer service is a failure! He surely startled everyone including those who are championing change from within. To explain, I’ll provide a bit of context to his position. In order to do so however, we’ll need to peel back an additional layer to demonstrate where customer service and social media are missing confluence. I refer to this phenomenon as the horseshoe effect.

On either end, social media and customer service are either established or developing within the organization. While each exist, they do not naturally co-exist in regards to process, systems, vision, or collaborative workstreams. Allow me to clarify. Today, social media is mostly owned by one of three functions within businesses today, 1) marketing, 2) marketing communications, or 3) public relations. Social media essentially exists within its own silo and is largely disconnected from other divisions.

When a customer tweets at the company with a problem, the social media team is either unqualified to respond or chooses only to focus on those interactions that correspond with their focus or the company’s marketing efforts. Either way, the customer doesn’t see, nor do they care about, who owns social media. They see one company and they simply need an informed and empathetic response. Even when a company has a service team dedicated to social media, it is often a progressive front with a traditional infrastructure – or perhaps said another way, making something appear better than it is. When a customer is engaged, they’re often prompted to take the interaction offline, say through email or phone with a specialized representative, or they’re simply referred to a particular web address, phone number, or email address to start the process from the beginning through existing, less preferred channels.

With social media on one side and customer service on the other, a gap emerges where the social customer is left to fend for themselves. Businesses must look at creating a holistic experience where customer service extends to social media, providing engagement and resolution at the time and place of the social expression.

Case in point, Niklas Femerstrand is a web developer who discovered a security gap in a particular web page owned by American Express. Long story short, the security hole left an administration panel for Web site debugging wide open for anyone to access and provided a potential avenue for attackers to target AMEX customers. Rather than exploit the gateway, he alerted AMEX via the channel he relies on for personal and professional communication…Twitter. What happens next only demonstrates the horseshoe effect and why closing the gap sooner than later will benefit customers and the company alike.

In his own words, Femerstrand expresses his disbelief when he could not get through to the company on a network where it maintains multiple presences,  “When somebody voluntarily contacts a company and repeatedly mentions words like ‘security vulnerability’ and ‘hacker’ one would think the company would act as quickly as possible.”

If you follow the exchange below, you’ll see that Femerstrand made an honest to goodness attempt to reach what he deemed to be the most direct channel to the company, @AskAmex. Please do take a moment to read each line item so that you can both see and feel his frustration and also visualize the horseshoe effect that separated social media from customer service.

As you can see, the exchange is priceless. Poor ^Courtney…

Femerstrand was clear. He didn’t want to be referred to a traditional service backend.  While Courtney was staffing the shift for @AskAmex, she was obviously not trained to handle such a situation and therefore demonstrated the horseshoe effect perfectly. So what is Femerstrand left to do when he was insistent that he wanted to help the company, but did not have time or patience to go through a “technical support jungle?” He blogged not only about the experience, but he also exposed the code and tipped security publications everywhere.

What’s the ROI of a Good Customer Experience

In his post about the failure of social customer service, Frank Eliason also notes that part of the problem has to do with how customer service is measured or valued within the organization today. Traditional metrics that are deeply rooted within the call center today are used as a baseline for an entirely new paradigm. Fortunately or unfortunately, the connected customer defines the rules of engagement and based on the interaction, will in turn share their experience whether it’s positive or negative.

As Eliason explains…

This brings me to the failure of social service. The other day someone tweeted me asking about current costs of phone calls versus the cost per Tweet for customer service. Ugh! This is new media and yet we’re already focusing on old metrics. The truth is that the service world has been broken for years because of the emphasis of handle time or calls per hour. Companies do not want to talk to you, and it shows. The fact is most do not want to Tweet with you either. Since they are worried about brand sentiment, they may appease you to shut you up. Sorry, shutting your customer up is not customer service and trying to expedite resolution isn’t a metric for the new world of consumer influence.

The time is now for new metrics. And by new metrics, I’m not referring to those that simply measure time to resolution, cost per tweets, wait times or Tweet reduction. The opportunity for increased engagement is the real opportunity for customer service. This isn’t about getting away from the customer or simply about solving problems. This is about creating exceptional and shareable experiences! Customer service can contribute to engagement, advocacy, loyalty, and what I call NPS 2.0 aka SPS (Social Promoter Score). It’s not the traditional NPS of whether or not someone would refer a product or company. In social media, we can see if someone actually did and compare that to those who are clearly public detractors. We can also view those detractors that recommend against a purchase.

Additionally, the new doors that are opening to customer service and customer engagement don’t simply have to be relegated to negative experiences. For example, I recently flew United Airlines and I was fortunate enough to have an exceptional experience on a flight from New York to San Francisco. I was so elated with the wonderful customer focus of one flight attendant in particular, that I decided to share it with @United.

I wasn’t surprised when the response was the equivalent of digital crickets. But, I had high hopes for some form of acknowledgement. And even though I know I was daydreaming, I would love to have seen the semblance of a system where that feedback would get back to both Meg Callan and her manager. All too often, social customer service focuses on optimizing the systems and strategies to contend with experiences when they negatively impact social streams. But I believe that if businesses can provide mechanisms where customers, employees, and positive experiences are rewarded, more people will become willful advocates than detractors.

If you’re unclear where to begin, then simply ask. When Google+ was new on the scene, prior to the release of its official brand pages, several companies such as Dell and Ford asked customers how they can use the new network to engage more effectively with customers. In one such case, Michael Dell personally asked followers on his profile if they would like to connect with Dell service via video directly on Hangouts.

The response, to say the least, was phenomenal. Customers were elated that Michael Dell would ask people what they want while also demonstrating how an organization could use new tools to improve customer experiences. The result is support, loyalty, and advocacy. Additionally, the result of one simple post resulted in an array of influential press. I guess that says everything about that state of customer service. If businesses ask how to better help customers and press breaks out as a result, well…at least we’re on the right track.

Closing the social customer horseshoe to create a complete circle is the equivalent of a holistic experience. Fixing customer service is not the goal here. Improving customer service and delivering an integrated experience will not only help customers feel valued, but also establish a competitive advantage. In the end, businesses that invest in customer retention and acquisition to deliver positive experiences, regardless of platform, will strengthen relationships and loyalty and additionally contribute to organic advocacy.

#AdaptorDie!

Order The End of Business as Usual today…

Part 1 – Digital Darwinism, Who’s Next
Part 2 – Social Media’s Impending Flood of Customer Unlikes and Unfollows
Part 3 – Social Media Customer Service is a Failure!
Part 4 – I think we need some time apart, it’s not me, it’s you
Part 5 – We are the 5th P: People
Part 6 – The State of Social Media 2011: Social is the new normal
Part 7 – I like you, but not in that way
Part 8 – Are You Building a Social Brand or a Social Business?
Part 9 – CMO’s are at the Crossroads of Customer Transactions and Engagement
Part 10 – From Social Commerce to Syndicated Commerce
Part 11 – You can’t go back to create a new beginning, but you can begin to change the ending
Part 12 – How to Make Customer Service Matter Again Part 1

Part 12 in a series introducing my new book, The End of Business as Usual…this series serves as the book’s prequel.

Over the years, customer service has been something of a paradox within the organization. The name itself inspires dedication to helping people. And while that is the intention of customer service professionals worldwide, customer service as a line item in business accounting has often placed it in the hands of outsourced organizations, under-qualified personnel, or in the hands of customers directly through self-service or automated technology. The mission of course is to improve profitability. It is what it is.

Perhaps it is the moniker of customer service that stifles innovation in philosophy, process and engagement. Perhaps it’s the conditioned nature of the overall role of customer service to be reactive, a gate keeper to negative experiences, or relegated to the outskirts of a business revolution. I suppose that’s the point however. We’re facing a revolution in consumer behavior which in turn triggers a revolution in business. From philosophy to mission and vision to processes and systems to goals and objectives, customer service is an opportunity to instill loyalty and also positively influence the decisions of others.

Here we are facing the end of business as usual and before us are two incredible opportunities for improving customer experiences and ultimately relationships, the democratization of media and connections and the executive decree to move businesses closer to customers. But before we jump in, we must rethink our approach and supporting infrastructure to not only meet the needs of customers, but also transform the organization to shape and steer them in advance of any impetus that would necessitate a response.

In 2011 American Express published its annual Global Customer Service Barometer to measure the current state of customer sentiment toward businesses.

At first glance, the study quickly noted that consumers believe that businesses are meeting expectations but not exceeding them. In a time when business as usual eventually inhibits growth, meeting expectations becomes a commodity. Creating exceptional experiences from here on out is priceless and will eventually become the minimum ante in business. Click on the images for an expanded view.

While certain companies are cutting costs on customer service or not exploring new opportunities for innovation, customers are demonstrating that now’s the time for transformation. People are willing to spend more for products from companies that have a history of good customer service or that deliver outstanding experiences.

People are frustrated with automated systems. They’re also not fond of the new trend in voice response systems that are now becoming industry standard. Would you be surprised if I told you that they just want to talk to another human being? As the numbers spotlight below, whether it’s on the phone, in real life, through instant messaging or social networks, one-on-one interaction will have a one-to-one-to-many result.

As social media becomes more pervasive in the lives of the everyday consumer, not just connected consumers, a new infrastructure will be required to support proactive engagement. For those sitting on the sidelines or casually experimenting with engagement, traditional methodologies and processes in social media will quickly be tested and almost instantly stretched.

Brands are No Longer Created, They’re Co-Created

The image above is a word cloud generated by the Tweets of customers who shared their experiences regarding @United (United Airlines). I removed the colorful language as this isn’t a discussion about United, but instead how customer experiences are shared and how they influence impressions and decisions. Additionally, this is an example of the necessary examination of how businesses are shaping and reacting to customer experiences in the midst of a digital revolution.

My point in sharing this with you today is that the two biggest words that standout clearly and represent the importance of our focus over the next several years are…CUSTOMER SERVICE. If you look closely enough, you’ll see two other words surrounding “customer service”, which I believe symbolize the importance of of a renewed or new customer focus, which center on…response and change.

Revisiting the American Express study for a moment, it’s clear that experiences impact brand perception and ultimately loyalty. Reacting to experiences is no longer good enough.

Not only does a negative experience reduce the overall satisfaction or perception of a brand, consumers are also willing to switch brands to get better customer service. The importance of customer acquisition is called into question when the value of  customer retention is not treasured or improved.

Connected customers will first take to social networks to ask for input as they consider decisions. Rather than rely on Google’s machine algorithm, the feedback that individuals receive in their networks of preference is qualified, trusted and human–basically these exchanges create a searchable and effective human algorithm. Needless to say, it is the experiences of those to whom I trust that define my impressions and following actions. While a website or marketing material may say otherwise, the collective experiences that populate social networks and ultimately my stream, weigh significantly heavier during phases of consideration than company-generated adjectives or imagery.

Engagement and Empathy Creates Positive Experiences

Customer service is often viewed through a lens of “us vs. them.” Businesses have built an incredibly expensive infrastructure to support customers when they need help while keeping them at arm’s length. However, connected customers have given up on these aging systems and are pushing for a more personalized form of engagement. Expressing discontent on social networks necessitates a response from the affected brand and without a response, those experiences further dilute the customer relationship and also taint impressions of those to whom hopeful customers are connected. Also, expressions open the door to competition.

In a study published by Maritz Research and evolve24 in September 2011, just under 1,300 consumers were asked about their experiences with Twitter and customer service. As the respondents’ ages increased, so did their expectations that companies would read and respond to their experiences.

Imagine for a moment, that as a connected consumer, you try using Twitter to get a response that could solve a problem or retain you as a customer only to feel disappointment in the absence of a response. That’s exactly what happened to the respondents of the survey. Just over 70% said that they did not hear from the company as a result of their Tweet. This sets up a bigger problem if the company is in fact on Twitter. It tells the consumer that their experience is unimportant and that the business is only present in social networks to market or sell products and not provide help. Saying nothing to a customer with a problem says everything about how you value them.

Providing resolution is only one part of the value proposition. Engagement as I’ve defined, is the interaction between a brand and a consumer. But it is in how it’s measured that counts.

No, engagement isn’t measured by Likes, comments, impressions, Tweets or Retweets. Engagement is measured by the takeaway value, sentiment and resulting actions following the exchange. People said that they felt better once they were contacted by a company representative on Twitter. That says everything…

In the end, transformation isn’t easy, but if it were, then providing exceptional customer experiences would become a commodity. This is a time when customers can work for you not just against you. And as customers are demonstrating every day in social and mobile networks, without a thoughtful approach or engagement, every Tweet, update, post, video and interaction is working against you right now. Customer relationships are to be shaped, not simply reacted to or  managed. This is why your role within the organization matters now more than ever.

Become the change you wish to see…

Order The End of Business as Usual today…

Part 1 – Digital Darwinism, Who’s Next
Part 2 – Social Media’s Impending Flood of Customer Unlikes and Unfollows
Part 3 – Social Media Customer Service is a Failure!
Part 4 – I think we need some time apart, it’s not me, it’s you
Part 5 – We are the 5th P: People
Part 6 – The State of Social Media 2011: Social is the new normal
Part 7 – I like you, but not in that way
Part 8 – Are You Building a Social Brand or a Social Business?
Part 9 – CMO’s are at the Crossroads of Customer Transactions and Engagement
Part 10 – From Social Commerce to Syndicated Commerce
Part 11 – You can’t go back to create a new beginning, but you can begin to change the ending

Part 5 in a series introducing my new book, The End of Business as Usual…this is not content from the book, this series serves as its prequel.

What do people want? If you don’t know, why not ask them?

Seems like a common sense question to ask. However, when it comes to customer engagement and relations, common sense appears to be an uncommon virtue. The good news is that asking customers what they need is now easier than ever before. Learning about what they prefer or what they’re missing based on their actions and words is prevalent within social media. Asking them directly is also a powerful form of engagement. At the very least the act expresses intent to learn and perhaps adapt.

Too many research projects or studies these days focus on what brands are doing in social media rather than what they should be doing. And at the same time, most are conducted from the perspective of the business and not from the perspective of the people affected by the actions or missteps of brands.

In February 2011 ExactTarget and CoTweet released a revealing study “The Social Breakup,” that provided a glimpse into the oft missed customer point of view. While many reports highlight why people Like and follow brands, this study divulged why consumers “break up” with brands in social networks.

Like any interpersonal relationship, the consumer-brand relationship has a distinct and fascinating life cycle. The relationship begins with the initial “spark”—the decision by the consumer to become a SUBSCRIBER, FAN, or FOLLOWER—followed by a blissful honeymoon period in which the consumer gets to know the company better through communications and social interactions. As the relationship progresses, the frequency and quality of interactions shapes the consumer’s desire to take the relationship to the next level.

If the company fails any of these relationship tests, a “social break-up”—i.e., an “unsubscribe,” “unfan,” “unlike,” or “unfollow”—is all but inevitable. When the consumer is no longer happy in the relationship, they will actively break off contact with the company…or just ignore their communications in the hopes the company will get the message that it’s over.

According to the study, 55% of Facebook users have liked a brand and then later decided they no longer wish to see the company’s posts. 51% of fans say that they really aren’t fans as they don’t visit the page or web site after the “Like.” 71% of consumers say that they’re now becoming more selective.

When asked why the honeymoon is over, the top reasons for unliking a brand in Facebook are:

1. The company posts too frequently
2. My wall was becoming too crowded with marketing posts
3. The content was too repetitive or boring

The reasons, regardless of percentage are equally revealing…

I only “Liked” the company to take advantage of an offer.

They didn’t offer enough deals. (note: if you combine these two details, “deals” would become the one of the top reasons people connected and disconnected from brands)

Their posts were too promotional

The content wasn’t relevant.

The company’s posts were too chitty-chatty without adding value

Twitter is a much different network than Facebook. However, that doesn’t stop brands from attempting to connect with customers. And, it doesn’t stop customers from experimenting with brand engagement. However, 41% of Twitter users followed a brand only to unfollow them shortly thereafter.

Again, when you ask the customer why they decided to unfollow their favorite brands, the answers are as difficult to hear as they are enlightening.

1. The content was too repetitive or boring
2. My stream was too crowded with marketing posts
3. The company posted too frequently

The remainder of responses are identical to the reasons shared earlier in reference to Facebook.

Not enough deals.

Too conversational.

Irrelevant.

Mind the (Customer) Gap

It comes down to something that’s repeated so often throughout our lives that we may have become immune to the importance of its message, “Mind the gap.” This cautionary expression is designed to protect us from our own potential missteps. But in business, we must mind many important gaps, one of which represents a dangerous pitfall in the evolving landscape of business.

The customer gap represents the distance between what we think customers want and what they actually want. The definition of this gap is different for every business and it is something that we must overcome.

Today we see so many brands flocking to Twitter and attempting to befriend new customers without realizing that they’re willfully stepping directly into an abyss of irrelevance.

It starts with answering some very basic, but vital questions.

What do customers value?

What do customers value in social networks with regard to the culture of each?

Why are customers seeking or reacting to brands in these networks?

What turns them off?

Why do they unlike or unfollow brands?

How can we introduce value to induce a sense of appreciation and ultimately loyalty or advocacy?

The answers to these questions exist. It just starts with asking the questions. More importantly, it requires that you do something with the answers…that’s the hard part.

When Perception isn’t Reality

IBM recently set out to measure the gap between customers and the corresponding awareness of businesses and their ability to meet the needs of consumers in social networks. Authored by Carolyn Heller Baird, Global CRM Research Leader with the IBM Institute for Business Value, IBM Global Services and Gautam Parasnis, Partner and Vice President for IBM Global Business Services, the study, “From Social Media to Social CRM,” teaches us about the emerging social consumer. Coincidentally, we learn more about their preferences than many social media best practices reveal to date.

The report begins with a level-setting that is refreshing and also challenging…

Understanding what customers value, especially when they are in the unique environment of a social platform, is a critical first step toward building a Social CRM strategy. What triggers a customer to seek out a company or brand via social media? What would make a customer reluctant to interact? And does social engagement influence customers’ feelings of loyalty toward a company as businesses hope it does?

The answer lies in one of the reports greatest insights and also one of its most obvious, “Obtaining tangible value is the top reason most consumers seek out businesses via social sites.”

While it’s easy to blame it on the youth, the reality is that the DNA of social customers is indiscriminant of age or any other demographic for that matter. This is more about psychographics, the linkage of people through common interests (note: interest graph) than it is demographics or the social graph.

As discussed earlier in this series, consumers are investing time in social networks to connect with friends and family. According to the IBM study, the total number of users in social networks doing so accounts for 70% of all social consumers. The subsequent reasons individuals interact in social networks is to access news and entertainment at 49%and 46% respectively. 42% desire to share their opinions and another 30% seek to access reviews. But what of those seeking to engage in conversations or relationships with brands? They number at a mere 23%.

IBM mapped the chasm between brands and consumers highlighting the separation that divides intention and actuality. 65% of businesses view social media as a new source for revenue. At the same time however, consumers claim that it is they who expect to realize value from businesses in social media. Nevertheless, the discrepancy between what customers want and what businesses think they want reside at opposite ends of the stream.

The perception gap is reminiscent of couples therapy where each individual sees the world so entirely differently that they require mediation to meet one another in the middle.

If you ask consumers why they interact with companies in social networks, they’ll tell you it’s to receive a discount (61%) or to make a purchase (55%). If you ask a business why they think consumers follow them in social networks their response is likely to mirror IBM’s results. 73% believe that consumers wish to learn about new products and an additional 71% connect to receive general information.

Perhaps most telling is the severity of misperceptions between consumers and brands. While consumers expressed the desire to receive discounts or make purchases as the top reasons for engagement in social media, businesses view these actions as the lowest two motives for connecting in the social web.

To “bridge’” these gaps requires a social CRM strategy and infrastructure to foster collaborative experiences through engagement that customers value. Social CRM tends to focus on technology and systems to provide stakeholders with access to information and processes to support informed engagement. sCRM can also greatly benefit by adapting to the 5th P in order to inspire updated methodologies for engagement that today’s customer can appreciate. It is as much a function of infrastructure as it is a matter of adapting to human nature.

Next Steps

Brands must face the tough reality that social media is in direct conflict with the mode of business as usual. Businesses must first with understanding the wants and corresponding behaviors of the social consumer to effectively adapt.

Introduce mutually beneficial engagement strategies and programs that are unique to the expectations of each community. Technology is an enabler, but customer service works best when it’s designed to serve.

Think like a customer. Or better said, take the insights that are gleaned from gathering intelligence to become the customer you’re trying to reach.

Social consumers are not looking for information, recreations of your Website or links to existing, probably outdated web pages. Recognize that the social consumer is quite content operating without your interference. If you’re unsure what they want, ask them. Then build experiences that deliver value and also build experiences that are shareable. K.I.S.S Keep it Simple and Shareable or Keep It Significant and Shareable.

Elvis once famously sang, we need “A little less conversation and a little more action…”

The End of Business as Usual will be available in the coming weeks. You can order now at Amazon | Barnes and Noble | 800CEOREAD.

Part 1 – Digital Darwinism, Who’s Next
Part 2 – Social Media’s Impending Flood of Customer Unlikes and Unfollows
Part 3 – Social Media Customer Service is a Failure!
Part 4 – We are the 5th P: People

Part 4 in a series introducing my new book, The End of Business as Usual…

It seems that adding the word “social” to any category escalates its importance. From the Social Customer to Social Commerce and from Social Business to Social CRM, the common thread that weaves everything together is people. It is people after all that are responsible for placing the social in social media. Everything else is just technology. So why is it that businesses still approach social media and the services and channels that connect this very human network as it has traditional media in the past? Just as in the emergence of connected customers, this inherent behavior is simply part of the DNA. This DNA where perhaps the “D” stands for disconnected represents the very fabric of business and the very essence that requires evolution in order to genuinely connect with tomorrow’s customer, today. Operating with a business as usual mindset no longer cuts it.

Regardless of media, good business comes down to a simple process of identifying customers, learning what they want or need, feeling their challenges, learning how they communicate with one another, and observing how they discover and share information. Yet, many businesses approach what is a natural bottom-up occurrence through a top-down system of pushing information, pulling would-be customers through funnels, and confining them to artificial feedback loops. To put it simply, if we visit the traditional 4P’s of marketing of Price, Place, Promotion and Product, the key ingredient of favorable engagement and business outcomes is the very thing that’s been missing all along, People – you, me and the individuals who invest in products and sometimes the brands behind them.

Even though businesses are experimenting with engagement in Facebook, Twitter, forums, comments, et al., I’m not convinced they see us beyond our avatars. Nor do they view our communities as influential cliques, but rather as rudimentary clicks. Many businesses don’t take the time to get to know us, yet they invest in new media as an attempt to build relationships without understanding why we engage.

The bottom line is that customers are not necessarily looking to build relationships with brands. They’re, we’re, looking for solutions, direction, insights, and value. Information, contests, and clever videos are now commodities that contribute to the already clogged arteries of new media. But every day, companies ask customers to “Like” them on Facebook and “follow” them on Twitter weighing the extent of their efforts on the quantity of the 3F’s (friends, fans and followers) in addition to traffic, clickthroughs, and views. It’s no wonder why so many pundits debate the value of ROI when businesses are still not defining the “R” or the return we seek nor are brands defining outcomes.

We’re not driving experiences, we’re reacting to them.

We’re not introducing meaningful value, we’re pushing content and creative.

We’re not designing programs around intelligence, we’re focused on monitoring.

It’s time we had a click to action!

I Think We Need Some Time Apart

A few years ago, Microsoft released a video that to this day personifies the disconnect between brands and their customers.

Customer: “I want a divorce.”

Brand: “What now?”

Customer, “We don’t talk anymore.”

Brand: “I just put down a mil on a TV commercial just to talk to you.” OR sub that with, “I just invested time and resources on Facebook and Twitter just to talk to you.”

Customer: “Exactly, you do all the talking, I never get a chance to…[cut off by brand.]”

Brand: “You can talk on our web site can’t you?” OR sub that with, “you can comment, Like, RT, or interact with us in social networks.”

Customer: “Sure, if I want to say, ‘order this product.’”

Brand, “See…!”

Customer: “This isn’t exactly dialogue.”

Even in any examples of today’s social media best practices, even the dialogue isn’t representative of the dialogue customers are seeking or that they find enough value in to continue to return or interact with brands. The first step in the in a journey that lead brands and customers down discontinuous paths is the lack of understanding, context, or desire to better understand customers and the virtual and real worlds in which they dwell.

Again, customers are not on social networks seeking relationships with business. You know that better than anyone. That’s not why you’re there. You’re there to interact with friends, family, peers and everyone else who matters to you. In many ways, you are the very person you’re trying to reach and it’s that perspective that should factor into any business, marketing, service, or product development cycle moving forward. We are the 5th P of marketing and business and this is the end of business as usual…

The End of Business as Usual will be available in the coming weeks. You can order now at Amazon | Barnes and Noble | 800CEOREAD.

Part 1 – Digital Darwinism, Who’s Next
Part 2 – Social Media’s Impending Flood of Customer Unlikes and Unfollows
Part 3 – Social Media Customer Service is a Failure!
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Connect with Brian Solis on Twitter | LinkedIn | Facebook | Google+ | BrianSolisTV

Part three in a series introducing The End of Business as Usual…Written by Frank Eliason (@frankeliason)

Certainly not a statement you would expect to hear from the person formerly known as @ComcastCares, but I think it is an important perspective to consider if we are to build stronger relationships with customers. As I look around I see many interesting aspects of social media from large and small businesses. and I am very excited to see companies trying new things to reach their customers. But we are now moving in a new direction and I think too few see it yet.

Today I am SVP of Social Media for Citibank (of course thoughts here are my own). I have had the privilege to see the impact social media can have on big businesses and I look forward to watching this come to reality. A few key observations I have had are:

- It all starts with trust

- Stories are the most powerful way to create & reinforce change

- Human connections are against the grain for many businesses, but imperative for social media success

- Many people are trying to make money off business leaders who do not understand social media (and they are being successful at it)

- We are so stuck on measurements, yet we are measuring the wrong things

I sometimes refer to the last twenty years in business as the Jack Welch era. While he is a business leader whom I have tremendous respect for, I also believe times are changing. Companies have been striving to focus on greater levels of metrics. For those who study Six Sigma, you have seen it first hand. When I first learned the Six Sigma process I was very excited. It was not about opinion, but instead where the metrics guided you. I completely understand why executives loved it. What many did not realize is those running the projects typically chose metrics that told the story they wanted to tell.

I am seeing the same trouble with social media today. People are focusing on the completely wrong metrics and not properly educating executives on the real story of social media. Today, companies are focusing on metrics such as ‘likes,’ fans, followers, etc. These metrics tell you nothing of substance. Few companies tie this information directly to their Customers through measurements such as the net promoter score of the social Customer, what products they are buying, etc. Most companies proclaim to be ‘listening’ in the space but very few have changed or implement processes or products based on this listening. Huge ROI can be gained just by measuring changes that stem from listening.  It’s sad to say, but the only changes I have seen are those due to large or threatening groundswells. And in my view, change was only made to silence the noise.

It is easy to pick on businesses where problems play out in social media. After all, it’s there for everyone to witness. The fact is that every business, large or small, can find out useful information via social media. It’s not just about listening, it’s about gaining insights and intelligence.  It should not take a groundswell of any proportion to get people within your organization to start to think about the Consumer. The world as we know it has already shifted. This is indeed the end of business as usual, but few are willing to admit it.

It’s not just the lack of intelligence or powers of observation that fail businesses. Traditional marketing is not as effective as it once was perceived to be. When I do watch TV, I tend to fast-forward passed commercials. I ignore virtually everything that enters my mailbox. When I am online, I, like you, pay more attention to what I am looking for or reading than digital ads. When I do go to buy a product, also like you, read reviews on websites like Amazon or I ask my social graph for their thoughts. The pendulum has shifted!

This brings me to the failure of social service. The other day someone tweeted me asking about current costs of phone calls versus the cost per Tweet for customer service. Ugh! This is new media and yet we’re already focusing on old metrics. The truth is that the service world has been broken for years because of the emphasis of handle time or calls per hour. Companies do not want to talk to you, and it shows. The fact is most do not want to Tweet with you either. Since they are worried about brand sentiment, they may appease you to shut you up. Sorry, shutting your customer up is not customer service and trying to expedite resolution isn’t a metric for the new world of consumer influence.

Many businesses run new media efforts through PR or marketing. I have even seen a few that run social media through their outside marketing agencies (talk about being close to the customer). Anyway, I have tried a few of these out over the years. My view is that these disconnected businesses are attempting to placate consumers, to minimize or eliminate the complaint. In order for social media service to scale, change MUST happen. Companies must care. New metrics must surface that place the customer back in customer service.

I do not get a sense however, that much has changed in the way businesses run, no matter how engaged in social media they are today. This is not because the scaling is not possible, because for the most part you can queue up a tweet just as easily as you queue up a call. The trouble is the efforts are not leading to wholesale change in the way companies interact with their customers. If you are simply placating loud customers, all you are really doing is encouraging others to focus on the channels where they believe resolution awaits.

What people failed to see regarding the Dell or Comcast success stories in the early social media days, is the amount of work that went on behind Twitter, Facebook, and blogs. The true transformation of these businesses what not in taking to social network, but instead building the back end to start fixing the problems that created negative experiences in the first place. In my list above, I mention the power of stories, and both Dell and Comcast utilized these online conversations or stories to help drive improvements. I am sure both companies will admit that this is an ongoing process and that wholesale change does take time.

Social media is creating change in how businesses conduct themselves and placing still underestimated power in the hands of consumers and employees. If you truly want to influence brand perception, companies must:

- Empower employees (they are the life blood and the greatest ambassadors for your brand)

- Improve the customer experience, not just through service, but the entire experience with your company (please note I did not limit that to products or departments because most businesses are one brand)

- Be more nimble and not so stuck on processes that prevent change

- STOP being afraid of your customer! If anyone is afraid to speak to a Customer, you are doing the wrong things

- STOP minimizing the value of your customer! They are more influential to you in the post-commerce phase than you can imagine.

As Brian says in the next book, the brand of your business is the culmination of shared experiences. And as a result, we are entering a time when business will change dramatically. It already has in the eyes of the consumer, but few executives have connected the dots. The bottom line is that businesses need to have wholesale improvements over the way they interact with customers. This changes is currently being driven by the customer, but it also must be driven by empowered employees who want to see success in their business and processes that support transformation and adaptation.

How do you drive change at your business?

Is your business afraid of the Customer?

Do people within your company want nothing to do with the Customer Service department, or even worse, look down on it?

I personally love the customer; they are my passion and success. I represent them in everything I do. I use their stories to drive change. It is something you may want to do to.

#AdaptorDie

The End of Business as Usual will be available in the coming weeks. You can pre-order now at Amazon | Barnes and Noble | 800CEOREAD.

Part 1 – Digital Darwinism, Who’s Next
Part 2 – Social Media’s Impending Flood of Customer Unlikes and Unfollows

New media marketing is creating an undercurrent that is shifting the very foundation of business. Without a full understanding of what’s possible, a clear view to the future or an idea of the strength or extent of the market undertow, executives cautiously embrace emerging social and mobile channels based on guidance of internal champions and external pressure from competitors and customers alike. But, leaders can only lead when their vision is focused and direction is defined. The ability to execute becomes paramount and the gaps that exist between goals and capabilities must be identified and solved for quickly to stay the course.

Metrics are critical indicators of performance and progress yes, but when new media enters the fray, more questions than answers cloud the ability to see beyond the horizon. And, as new media becomes increasingly disruptive, innovation and a bit of clairvoyance are required to serve up new hypothesis that help leaders make decisions in the absence of history or precedence. It is in these times when competitive threat is equal to, or in some cases less than the threat of digital Darwinism. When technology and consumer behavior cause change faster than your ability to recognize and adapt (and lead), we surface the first and potentially dangerous series of slipping points that like the game of Chutes and Ladders, cause us to fall further away from our position or intention.

By the Numbers

These days, solutions are more experimental than they are evident. As a result, businesses rely on what they know. In this case, existing metrics and frameworks are applied to help ease testing and experimentation. Earlier this year Duke University’s Fuqua School of Business and the American Marketing Association published the results of its annual CMO Survey. Among the findings, we learn how executives are applying traditional metrics to new media to measure performance. Additionally, we can compare the current trends in measurement to this time last year to get a view into how businesses are adapting measurement against new opportunities.

At the top of the list, we see that traffic (hits/visits/page views) is the most important metric according to the report, increasing from 47.6% to 52.2% in one year. Naturally, repeat visits rank second at 34.9%. However, a less important metric, the number of followers or friends, commands the third spot at 34.1%. This represents a huge jump from 24% the year before. Clicks to action were surprisingly positioned in fourth with 29.3%, up from 25.4%, with marketers tracking conversion rates from visitor to buyer. I would have expected this in second or third. And, oddly enough, the importance of measuring sales fell from 17.9% in 2010 to 13.3% in 2011. The importance of measurements such as revenue per customer also plunged from 17.2% to 9.6%; customer retention costs dipped from 7.7% to 6.4%; and, profits per customer dropped from 9.4% to 4.8%.

At first glance, I can’t tell if these numbers represent the migration of an organization toward a culture of customer-centricity or a culture of compromise. Are these numbers falling because they’re difficult to measure or is it because they’re not important? Certainly with all of the discussions about ROI and the importance of proving the ability to meet customer needs while triggering meaningful outcomes, we could find a way to improve engagement strategies beyond the 3F’s (friends, fans and followers). To survive digital Darwinism, we must challenge ourselves and management to migrate toward relevance and significance. That means new metrics are necessary to measure progress in a new direction.

Over the last several yeras I’ve met with countless business leaders seeking input into the insights and corresponding metrics necessary to listen, learn, engage, and adapt in a new era of empowered consumerism. In fact, I believe that a significant gap exists between existing metrics and those required to chart new courses toward relevance. For example, one metric that I hear more often than not is the reduction of inbound customer inquiries as a result of DIY or automated knowledge bases. Of course, if the customer can answer their own questions, they won’t need us. But, that same metric is carrying over to social media. If a Tweet can resolve a problem, the company has succeeded in reducing the inbound burden to the contact center.

At a time when executives claim that getting closer to customers is a top priority for 2012 and beyond, how is it that we can employ metrics that continue to do what businesses have done so well over the last couple of decades – the ability to move further away from customer engagement through barriers of technology?  Customers just want to hit “0″ to talk to someone live. The same is true for new media. Customers are in control of their own experiences, what they share, and how they make decisions. Businesses can either accept this reality and work towards a collaborative business model of co-creation or simply choose to not be part of the long-term equation.

With an effective reduction of published negativity, we should explore acts of increasing customer engagement as a way of cultivating meaningful and productive experiences. It is through the generation of positive experiences that we can assure the materialization of other important business drivers such as sales, referrals, acquisition and retention costs, etc. More importantly, we can ensure relevance. Everything begins with understanding what it is that customers want and mapping these findings to what executives are driving toward. In the process, you may in fact find that a gap exists. But discovering the gap is what you’re supposed to do when the future is uncertain. It is what you do with this new found awareness that defines your place in the hearts, minds, and wallets of customers and prospects.

Ignorance is bliss until it’s not. After all, if ignorance is bliss, then awareness must be awakening.

Connect with Brian Solis on Twitter | LinkedIn | Facebook | Google+ | BrianSolisTV
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The End of Business as Usual: Rewire the way you work to succeed in the consumer revolution

Pre-order now at Amazon | Barnes and Noble | 800CEOREAD.
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ENGAGE!: The complete guide for businesses to build and measure success on the social web

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Click here for your favorite infographics…now in 22 x 28 poster format!

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It’s not a widely kept secret, but customers do indeed keep companies in business. While businesses have long invested in improving customer relationships, the time has come to think beyond efficiencies and automation and examine new opportunities to rethink customer experiences overall. Why? Customers are more connected than ever before. The role they play has exploded beyond transactions and is now influencing the transactions of others as well as contributing to the brand experience at levels never before seen.

It’s said that your brand is defined by what your customers and employees say when you’re not in the room. Well, the proverbial room has now taken center stage on the social web and as a result, your brand is indeed shaped by the words and experiences of your customers and those who influence them. The future of business isn’t created, it’s co-created.

My good friend Becky Carroll just published her new book and I was honored to write the foreword. The team at Wiley has given us permission to share it with you here. If you get a chance, please take a look at “The Hidden Power of Your Customers: Four Keys to Growing your Business Through  Existing Customers.”

The Rise of the Connected Customer and the New Era of Relevance

Good customer service used to be one of the secrets to business success. Over time, however, what was considered “good” turned out to be not good enough. Somewhere along the way, customers became a burden, viewed by big organizations as a cost center and by smaller businesses as an inconvenience. Processes, systems, automated attendants, and technology eventually separated us from them and … well, here we are today, wondering how it is that the very people who contribute to the overall health of our business are farther away from us than ever before.

Let me ask you a question: When you picture customer service, do you see it from the standpoint of you as a business owner or stakeholder in a company, or do you think of it from the customer perspective, where your experiences as a customer remind you of what good service is and isn’t? I have to be honest, writing this brought to mind some painful experiences, when I just didn’t feel the appreciation I would expect as a customer. I have a feeling it’s an experience you and I share. That’s the point. As customers, we can share countless stories of unpleasant encounters—and have most likely already done so with our friends and family. How many great customer service experiences can you recall, and how often did you, or do you, talk about them today?

This is the perspective you need as you look to your customers today to grow your business tomorrow. This may sound silly, but the future of business takes a personal touch.

Let me share a secret with you, a secret that will unlock the four keys to growing your business: Empathy is the connection between you and your customers. Empathy is the bridge between your customers and their peers.

I’ve known Becky Carroll for several years, and the message of empathy is one she has shared with us time and time again. As so many relationships begin these days, I initially “met” Becky online, through Facebook, Twitter, and blogs. In February 2008, I had a chance to see her in action at “The Customer Service Is the New Marketing Summit,” hosted by GetSatisfaction in San Francisco. Becky’s session was titled “Customer Experience: The Intersection of Marketing and Customer Service,” and her words still echo true today.

Great—not just good—customer service is necessary for business survival. Personalized and empowering customer service, fanned by empathy, is the recipe for viral customer service, where word of mouth becomes an extension of your marketing and sales efforts.

The future of business is rooted in shared experiences. Customer experiences will be shared, and they will either be positive or negative. Not unlike the reviews we’ve either posted or read on Amazon, people either love or hate an interaction they’ve had with a company. They feel so strongly about it, they’ll take to Amazon or any other review site to ensure that everyone else feels what they’re feeling prior to making a purchase decision. Again, customer experiences will either be positive or negative, and you can bet that they will be shared.

The wonderful aspect about all this is that you get to choose which type of experience your customers will have. More important, if you can engender a positive experience for them, you can literally plug into an entirely new world of connected consumerism that extends those exchanges beyond the typical few friends they might tell either way. Nowadays, customers are connected to one another through social networks and online groups. This isn’t new; what is new is the nature of these relationships and the efficiency with which information travels within and beyond inner networks of friends.

The average person is connected to 140 people on Twitter and 130 on Facebook, and even they can trigger a social effect that extends experiences beyond small cliques of friends and family. There’s a new genre of customers rapidly emerging, and they’re connected to not hundreds but thousands of others. The social or connected customers is your influencer. They are the gatekeepers to a more efficient and expansive network of referrals linked by shared experiences and optimized through an endless social effect that extends your value proposition beyond your reach today. Yes, that was a long sentence, but I couldn’t shorten it, as doing so would have minimized the importance of what’s before you.

We are embarking upon a new era of business, one that I believe represents the end of business as usual—and this is a good thing.

Customers want a few things:
• Products or services that meet or exceed their needs.
• The ability to find what they need when they need it.
• A channel by which to be heard.

What customers now bring to the table is the ability to get each of the above with or without you. This is your opportunity to plug in to these networks, where you can build relationships, cultivate loyalty, and learn how to adapt, all while earning greater relevance and reach. Brilliant!

Everything begins with defining the experiences you wish others to share.

There’s a mnemonic spelling lesson in English most of us learned that, to this day, is impossible to forget: “i” before “e” except after “c.” It can, however, be applied to much more than everyday spelling. To remember the importance of the customer, I’ve adapted its definition as follows:

Insight before engagement unless customer or community needs take immediate precedence.

With the emergence of social media, we are given not just a right to engage but a rite of passage to earn relevance.

Social networks are much more than Twitter, Facebook, Foursquare, YouTube, et al. These networks represent a potential much more transformative: that is, the democratization of information and the equalization of influence within new digital societies. Here, everyone begins at ground zero, including you, but it is how behavior evolves that introduces us to a new future of sales, service, and business. As everyday sales and service become commodities, experiences and relationships become paramount. Peers, friends, family, and experts become trusted sources to steer and filter relationships within these new landscapes. Sharing becomes social. Decisions become social. Commerce, and ultimately service, becomes social. At the heart and soul of all of this is the very essence of your business—shared experiences connected through empathy and fortified by the desire and intention to shape them in ways that help people help you.

Take this book and use it to grow your business. More important, use it to build relationships that turn customers into advocates and advisors.

In business, as in life, you earn the relationships and, with nurture, the yield that you’ve earned and deserve.

Care. Guide. Connect. Learn.

Brian Solis (@briansolis), author of The End of Business as Usual and Engage!, digital analyst, and champion for everyday customers
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For decades, companies were very good at pushing messages into markets and talking at people rather than with them. Now companies are embracing the idea of two-way interaction. Monitoring conversations is becoming standard procedure as small and enterprise businesses alike make substantial investments in tools such as Radian6, Sprial16 and Brandtology. And, not only are companies monitoring conversations, they’re adopting social media management systems (SMMS) such as Seesmic and CoTweet to operationalize conversations and platforms such as Objective Marketer, PeopleBrowsr and Buddy Media to automate engagement campaigns.

There’s a difference between monitoring and listening and there’s certainly a difference between conversations and engagement. How social media is employed today promotes monitoring as a reporting function and conversations as a symptom of reaction. In many ways, the state of social media is eerily reminiscent of traditional marketing. We’re fooled into a sense of collaboration and co-creation because people can respond. But programs are not measured by functionality, they are valued by the value customers take away from the experience. It begs the question, is social media in actuality anti-social?

New media philosophies, while rich with good intentions, are confined by the culture of the organization they’re designed to help. Corporate culture is pervasive and planted. It is not anything that will change suddenly because of the popularity of Twitter and Facebook no matter how strong your case. Culture shock takes place because a business is subjected to the harsh reality that customers no longer support the way business is conducted.

Value is not Stated, It’s Delivered…and It’s Felt

Social Media offers a window to the future and a means to earn relevance, nothing less, nothing more. It is an enabler to reinvigorate the mission and vision of the company and extend its value only when the purpose and value have been redefined for a new generation of consumers. This is where it all begins. Otherwise, your engagement strategies activate a timer that counts down the journey to irrelevance.

People have choices. They have options. They can make decisions with or without you. How they’re marketed to today is the beginning of the end of social media 1.0. Social streams are brimming with information, promotions, and friend requests that compete for a finite amount of attention. Something more is required and it’s needed now.

Brands are doing well at building communities in social networks once they realize that there’s an art and science to engagement, content, entertainment, and community activation. But a community is only as strong as the aftereffect that’s produced when it is tested. For example, do customers click through to landing pages? What happens when they get there? Are referrals active and how do they pan out? Are individuals addressing the problems or challenges of their peers when you can’t be there? Or, are they merely interacting with each update within your domain because it’s easy to do so?

@ and Found

The future of social networking lies in conveying value and delivering against the brand promise not only within your communities but also in the communities you do not own and are not present. I refer to this as the “@ and Found” formula for engagement. Businesses are getting better at monitoring conversations where the brand name is mentioned. Some are proficient in comparing mentions to the volume and reach of competitors. Mastering the cycle of monitoring goes beyond reporting however. It must be supported by a conversation framework that pushes important opportunities to engage or learn through the organization to return a response or trigger change or adaptation within.

A conversation framework has a beginning and an end with various pathways to business units and functions in between. Responding to opportunities and communicating the act of listening and adapting form a solid “@” quotient in this equation.

These individuals represent would-be advocates for your brand. If they’re happy with the product or brand experience they are candidates for an ambassador or advocacy program. Note, advocacy programs require different engagement techniques than that of influencers. Advocates operate from a genuine passion for what you do. Influencers operate from a basic perspective of, “what’s in it for me.” They are most likely not customers or users of your product or service today.

As referenced in the image above, MarketingSherpa found that outside engagement represents a greater degree of difficulty but equally offers a greater level of effectiveness.

Responding to mentions is just the beginning. It’s the low hanging fruit of conversational marketing and social media in general. The “Found” side of the calculation is where the future of brand relevance takes shape. It’s not about who you engage with today or those that engage with you, it’s about those who don’t. These prospects are active in your markets, your brand is just not an option for whatever reason. It’s your job to figure out how to earn attention and significance among them and the communities in which they populate and influence.

While advocates are discoverable by brand-related keywords, the “Founds” are identifiable by keywords related to markets and interests.

- They define communities of opportunity
- Recommend other products and services
- Answer each others questions
- Share experiences
- Earn authority on subjects tied to your industry

Listening to what they say and understanding the challenges and opportunities they face provide intelligence to inspire a meaningful engagement program. Once activated, the responses will funnel through the existing listening and conversation framework to ensure continued engagement, resolution and closure.

While the “@’s” represent an opportunity for advocacy, the “Founds” reveal potential influencers. Earlier I mentioned a difference between conversations and engagement. Influencers do not gain value from random acts of conversation. They do however, respond well to informed engagement where value and mutual benefits are inherent in the outreach.

The next era of social media is not based on a one-to-many model but instead a one-to-one-to-many continuum that naturally triggers a measurable social effect. Indeed, 1 + 1 = Many.

We are situated in a market that is in transition. Operating with what we know must be balanced by learning what we don’t know and then applying it to the mix based on the needs and expectations of our customers. Doing so may push us outside of our comfort zones, but in the end, it is how we earn relevance today and over time. Welcome to the end of business as usual.

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Who owns social media? Is it marketing, customer service, public relations?

Looking at a recent study conducted by the Pivot Conference, the top four departments where social media is currently run are as follows:

1. Marketing
2. Public Relations
3. Sales
4. Customer Service

Perhaps, it’s the wrong question to ask however. It’s not unlike asking who owns email. But, here’s another question and as we think about it, let’s broaden our perspective as the answer may not appear immediately.

Who owns the customer relationship?

The short answer is everyone.

If that is the case, then examining how social media is run today is not at all how businesses should think about it tomorrow. A not so long answer to the original question is “any person or department affected by outside activity where public interaction impacts decisions.”

Businesses tend to have a single or narrow view of the customer and as we’re learning, they’re connecting with one another and sharing experiences that transform their roles from prospect to advocate to adversary to influencer and everything in between.

Social media is not about conversations on Twitter and Facebook nor check-ins on Foursquare or Places, or flipped videos on YouTube. It’s about using this opportunity to build bridges to a new genre of customers and the people who influence their decisions. Our mission now is to pave paths to future relevance. The reality is that we are as much competing for the future as we are for the moment. And as a result, we are perpetually competing for relevance.

We can blame it on process, hierarchy, ignorance, lack of budget and anything and everything standing in our way. Or, we can own the acts of socializing the company using social media as a banner for customer centricity across the organization. Maybe we could all follow the advice from my dear friend Hugh MacLeod (@GapingVoid) and create our own #Evilplan for change. Then grab a pair of self-sharpening industrial scissors and run through the hallways to begin the long and arduous process of cutting red tape to free people to collaborate internally and externally.

Someone has to do it.

Without you, even though we’re operating with the best of intentions in social media, we are still operating from silos. The customer however, does not see silos, they sees the company as one. It’s time for an integrated approach to create an adaptive business, a collaborative business, an aspirational business….a business of one.

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For decades brands basked in the glory of control, control over consumers’ perceptions, impressions and ultimately decisions and ensuing experiences. Or better said, business leaders enjoyed a semblance of control. While businesses concentrated resources on distancing the connections between customers, influencers and representatives, a new democracy was materializing. This movement would inevitably render these faceless actions not only defunct, but also perilous.

Fueled by the socialization of media, content and connections served as the foundation for this new democracy and “we the people” ensured that our voices were heard. Social Media would forever change the balance of power within markets, placing the fate and stature of brands in the words and actions of consumers and the people and groups that influence their decisions. Brands didn’t just “lose” control of defining impressions, businesses lost the ability to govern shared experiences.

Suddenly people enjoyed the freedom to publish their thoughts and the capacity to earn prominence in these fledgling social ecosystems. No longer was it an era of brands saying what they wished us to think; it was now clear that people were in control of their impressions and more importantly, how, where and when they shared them.

It’s no longer about what we say, it’s what they say about us now that counts.

Sometimes truth and reality awaken us to a new reality. And in this case, everything changes…for the better.

Contrary to popular belief, social media didn’t invent conversations, it just allowed us to organize and surface them.  But, when we look at the importance of branding, the mechanics and methodologies for defining, protecting, and growing the brand profoundly change. As such, the value of brands are at risk of dilution based on the aggregate of shared experiences by the new social consumer. And, perhaps the greatest challenge that faces brands in addition to dilution, is the inability to right its course in real-time. As media democratized, the meter for establishing prominence started to accrue varying levels of influence for its participants while many businesses missed their calling. It’s not too late for brands to engage however, the difference is that everyday people have earned greater reach than some businesses within these social channels.

The Evolution of Brand Marketing

The medium is no longer just the message. In social, the medium is the platform and as such, people now represent both the medium and the message where reach is defined by a blending of the social graph, the context of the story and ensuing connections, and also by the state of the attention aperture of those to whom we’re connected.

Simply stated, social media is changing brand marketing and forcing a (r)evolution that will unfold differently within each organization.

MiresBall and KRC Research recently conducted a study that found 4 out of ten brand marketers believe that social creates challenges to maintaining brand integrity. In addition, more than a third believed that social networking affected brands to the point where marketing strategies would require new thinking. This new direction however, is rife with new challenges as well as opportunities.

Belief that Social Media Creates New Challenges for Protecting Brand Integrity, 2010

Belief that Social Media Provides an Opportunity to Reach New Customers

Brand marketers realize the importance of social media, but they’re unclear as to how it can specifically help with engendering loyalty. 35% believed social lends to loyalty, but 30% disagreed and another 35% were neutral on the subject. While marketers were split on loyalty, over one-half agreed that social media serves as bridges to reaching customers and prospects.

Update the Brand Style Guide

The study also revealed a growing concern among brand marketers on how they engaged with consumers today. The consensus was that in order to successfully connect with consumers in such a way that reinforces brand attributes, representatives require training, messages, and empowerment.

When it comes to brand dilution, consumers aren’t alone in their endeavors. Brand representatives and the lack of a prevailing strategy, mission, or purpose in social media causes the breakdown of branding and messages directly from the source. At the moment, a disconnect exists between the brand, its representatives, and consumers in social media. This disconnect starts with understanding the brand’s voice, presence, and personality and what it is it needs to say to the varying roles of the social consumer.

I refer to this series of fragmented touchpoints as The Last Mile. And in order to establish connections with individuals in their domains where they are in control of their experiences, it takes empathy combined with value, reinforced by branding elements that strengthen the story, the engagement, and the resulting activity. Without first defining the brand in these prominent social networks, how can we expect it to thrive and flourish let alone inspire consumers?

To prevent the dilution of our brands in social media, everything must begin with revisiting and revising the brand style guide. This style guide must be embodied by brand representatives where engagement is clearly led not by the “brand you,” but instead the brand “you represent.”

In an era where brands are both created and co-created, defining our brand, its meaning, and its value and humanizing it, will set the stage for collaboration and brand concentration.

Losing control in an era of socialized media and equalized influence, actually gives birth to an important form of empowerment. With a new found ability to listen to conversations tied to brands, products, and experiences and also analyze associated sentiment in real-time is stirring and enlightening. If ignorance is bliss, awareness is awakening. We now have the ability to understand impressions and perceptions and through engagement, we can contribute to their accuracy as well as define our brand relevance and legacy through every profile, conversation and social object we introduce.

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Twitter is a human seismograph and it represents a transformative channel where everyday people possess the ability to affect actions. The cloud of collective consciousness that houses our thoughts, experiences, and conversations is also a data trove for experts to measure and mine serendipitous and organized behavior and events.

Twitter is less of a social network in its design and operation and more of a series of interconnected social nicheworks. It brings together disparately connected personalities linked through friendship, admiration, education, and context. Here individuals align around people they know, would like to know, and bound by the topics, themes, and connections that attract them. This highly contextualized network, or as Twitter refers to it, an Interest Graph, offers individuals an organized, indexable, and searchable stream where they express sentiment, share observations and information, and also directly and indirectly communicate with one another.

For marketers, Twitter represents so much more than a real-time focus group. While the activity of its users is available for interpretation and analysis, the information contained in certain tweets published by notable individuals possess the capacity to influence agendas and resulting activities. And even in aggregate, everyday users define the direction of the stream and ultimately impact the subjects of their conversations.

Any organization impacted by outside activity must dedicate focus and resources to monitoring and analyzing activity, the extent to which it shapes perception today, and how to share and steer activity to benefit stakeholders online and in the real world.

A recent study by ExactTarget and CoTweet surveyed 1,500 consumers to identify top motivations for following brands on Twitter. As a result, we can glean insight into the expectations of elusive and prized consumers when interacting with brands online.

The ExactTarget and CoTweet study reveals an important part of the social ecosystem that demonstrates why businesses need to consider not just a 360 approach, but a socialized approach. Of the consumers surveyed, 72% publish blog posts at least monthly, 70% comment on blogs, and 61% write at least one product review monthly. The social consumer is vocal and they’re connected.  Considering now that audiences are shifting from content consumers to curators and creators, our market is now defined by audiences with audiences with audiences. Individuals maintain active and expanding social graphs and as they grow, the network effect only escalates.

In April 2010, Performics and ROI Research found that 33% of Twitter users share opinions about companies or products at least once per week. More so, 32% make recommendations while 30% seek guidance and direction.

Wait. What?

- 33% talk brands 1x per week

- 32% make recommendations

- 30% seek advice

Among other interesting stats, 20% of consumers follow a brand in order to interact with the company, which is much greater than those who subscribe to email newsletters or those who “like” brands on Facebook in order to remain connected. In fact, nine out of the ten stated that the most common reasons to follow a brand on Twitter involved the ability to obtain direct information from a company.

In other studies, upwards of 80% of Twitter users stated that for those deserving brands, following equated to referrals. Of those who followed brands, 51% did so because they were an existing customer and 44% expected discounts or promotions.

One of the more interesting data points to emerge was that men were more than twice as likely than women to follow brands on Twitter, 29% compared to 13%. This stat requires deeper analysis as it, on the surface, rivals two primary research pillars in my current work, 1) More women than men account for the overall Twitter population and 2) Women, in aggregate, are more influential than men on Twitter.

If you were to take one thing away from this research, it’s this…Twitter users are the most influential social consumers online today. This revelation is constant across many published research reports. Not only are they influential, they put their money where their Tweet is.

While money doesn’t grow on trees, it does however, grow on Tweets.

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In social media, is there truth to the proverb, “seek and ye shall find?”

As our experience in new media matures, learning what it is we wish to seek and also accomplish is at the forefront of rapid evolution. Converting questions into objectives is how we grow and succeed. While the opportunities within social media in general are sweeping, one such possibility that’s largely untapped in business social networking is the ability to find customers and prospects as well as learn what inspires them to make decisions and share experiences.

Customers and those who influence their decisions take to social media to learn, discover and share. As a result, social networks such as Twitter, Facebook, LinkedIn as well as hyper-local networks including Yelp and Foursquare are evolving into potent touchpoints for customer acquisition and retention.

Social Networks in Customer Acquisition

Regus, a provider of workplace solutions with over 1,100 business centers in 85 countries, recently published a study that explored the role of social media in customer acquisition. Based on input from senior managers and business owners around the world, the study found that almost one-half of small businesses are successfully connecting with prospects through social networks. On the other side of the spectrum, only 28% of large firms reported finding new customers in social networks. Medium-sized businesses landed appropriately in the middle at 36%.

A Global Perspective

The worldwide survey also ranked countries who found success in customer acquisition in social networks. With 14 countries reporting, an average of 40% reported that social networks were indeed ripe for converting prospects into customers. At the very top of the list, 52% of businesses in India reported success followed by Mexico, Spain, The Netherlands and China with 50%, 50%, 28%, and 22% respectively. The US ranked 7th with 35%.

1. India – 52%
2. Mexico – 50%
2. Spain – 50%
3. Netherlands – 48%
4. China – 44%
5. South Africa – 43%
6. Germany – 41%
6. Australia – 41%
7. US – 35%
8. Canada – 34%
9. France – 33%
9. UK – 33%
10. Japan – 30%
11. Belgium – 27%

combination of search and focused keywords

This is Just the Beginning

Leading metrics firm, comScore, released its Q1 U.S E-Commerce Spending Report and found that Facebook and Twitter visitors spend more money online than average Internet users. And, as social networks usage increases, so does the propensity to spend online.

These numbers will only continue to grow. Everything begins with search, and for those businesses who master the art and science of transforming basic search queries into lead generation in social networks will find an entirely new landscape of opportunities.  The question is, what are you going to do about it? And once you’ve converted prospects into customers, how will social media factor into your retention and advocacy strategies?

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I’m working on developing ideas that originated when writing Engage. It didn’t make the deadline, but wanted to share them here with you for your review and also to seek your feedback…

Everything begins with a shift in perspective from viewing stakeholders as a separate entity, “us vs. them,” to a singular view of “us ” as this enlivens a new era of community-focused marketing and engagement.

Social media introduces a new problem of sorts, one where the answer is lost in the politics and corresponding burrows of debate as to who owns social media within the organization. As brands venture into social networks, many are unwittingly contributing to the dilution of their brand image, value proposition, and mission amongst a new genre of social customers and influencers. The mission and vision statements of old no longer convey authority or inspire conviction in an era where the audiences to which we are trying to connect now possess audiences of their very own. The ability to connect with someone and inspire them to take meaningful action is in direct competition with the actions of social customers who are intentionally or indirectly building communities around their views and interests.

In my work, I’ve uncovered what I call the Last Mile or Last Kilometer of Social Media, a challenge that will face every business in the attempts to engage with consumers and influencers and impede the cultivation of dedicated and flourishing online communities.

The last mile is a term associated with the cable and internet provider industries, representing the final leg of delivering connectivity from a provider to a customer. It is symbolic of the human connection required to take a service from the connection hub in any given neighborhood to the home of the new customer.

The Disconnect: Defining the Problem

At the moment, a disconnect exists between the brand, its representatives, and consumers in social media.

Personality Eclipse

Representatives on the front lines in social media are arguably unversed in the elements that define the brand persona, purpose, and value. It’s also highly plausible that many of these representatives are not immersed in the challenges and options that face the people to whom they’re trying to connect and recruit. As a result, their actions and words are diluted through the reinforcement of individual personality traits that don’t match, convey, or strengthen the characteristics or voice of the brand they represent. While their engagement is mostly transparent and authentic, they are not genuinely empathetic in acknowledging or addressing the needs of their communities because they have not lived a day in life of their consumers.

Simply said, the personalities of each representative eclipse that of the brand they represent and without realization, the two can work against each other over time.

The Brand Dilemma

The brand team along with executive management is either slow or reluctant to adapt what was once the brand story and mission in traditional media and communications and modernize and humanize it for an era of interactive and social relations. For example, if the brand were a person, whom would it resemble? What does it sound like? What are its mannerisms and stature? What are its convictions, beliefs, and passions? Essentially, what are the persona and characteristics of the brand and what does it represent today and tomorrow? More importantly, how do we align the personalities of our representatives with the character of the brand?

Companies are not intentionally adapting brand style guides for the social web and in turn, empowering their representatives through training and reward. Instead, they’re simply guided by social media guidelines and policies, if that.

The Consumer Quandary

Social media is, for the time being, viewed as a single entity, where the whole is greater than the sum of its parts. When we talk about a 360-degree approach with social media completing the rotation, we relegate participation and conversations to a means for intermittent engagement, but not as the complete solution for 360 business processes and mechanics. For example, companies are structuring social media around a function, but not necessarily as an extension of existing business practices. In some cases, customer service is at the forefront of listening and engagement; in other scenarios, marketing or communications is leading the engagement; and in alternative situations, advertising is controlling the creation and dissemination of the story.

Social media is not served by any one role however; it represents the opportunity and need to socialize the entire organization. As is, the consumer in the various roles they play in our ecosystem, are largely passed over as a result of an infrastructure that doesn’t recognize their social existence and the parts they play in the definition of our markets over time. I believe that any division of an organization affected by outside activity will require a socialized approach, whether it’s simply monitoring or more likely monitoring, engaging and adapting.

The Last Mile – The Socialization of Business

The Last Mile of Social Media is solved by “connecting the brand” and its purpose, value, intent, and voice with the consumers in and around the diverse roles they play in the business ecosystem. It supported by a methodology and framework that proactively and reactively connects representatives and value to people of interest in their “social” homes.

Ring of Representatives: The outer ring is orbited by brand representatives from various divisions.

The Last Mile: Representatives are connected to consumers based on needs, challenges, and opportunities unique to business processes and functions. The interaction is a seamless extension of the company purpose, value, voice, and bonded through genuine intent and engagement.

The Consumer Hub: A cushion between the “Last Mile” and the consumer is padded by a trust zone that is developed around each consumer and dictated by the experiences with your product/services and fortified by the communication and engagement of your brand team, those of your competitors as well as their peers. Their experiences lead to perceptions and impressions that are in turn expressed through their social networks.

The Last Mile creates human connections with the mixed roles of the social consumer, one that brings to life the brand persona, purpose, and understanding through person-to-person interaction outside of the brand’s domain. The socialization of business then creates a unique bond between people and a more humanized and approachable brand icon, reinforced through informed, purpose-driven engagement.

UPDATE: Please read Josh Hallet’s excellent thoughts on The Last Mile published this January.

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One of the most sought after answers in Social Media is whether or not engagement in social networks such as Twitter or Facebook directly correlates to customer acquisition, retention, and advocacy. Before we can earn customers however, we have to recognize that at any given time, there are also prospects. And, prospects require information and confidence in order to make decisions, in your favor of course. The answer to our question lies in social engagement.

Prospects are not only searching for guidance, comparisons, and experiences through Google, they are also becoming increasingly social in every step of a decision making process. If brands do not identify the various stages of choice and resolution and also the networks where they socialize and explore, opportunities will be missed.

If we’re not part of the decision making cycle, we are absent from decisions.

From Fans and Followers to Customers

In order to connect with prospects online, we must do so where they’re already active. New research reveals that doing so may have a strong effect on the decisions and activity of your customers. In February 2010, market research firm Chadwick Martin Bailey along with iModerate Research Technologies, surveyed over 1,500 individuals online as well as conducted one-on-one discussions to contextualize social media behavior.

The study found that an astounding 60% of individuals who “like” pages dedicated to brands on Facebook are more likely to recommend the brand than those unaware of the company’s presence within the network. Perhaps even more incredible, is that 79% of consumers who follow the brand on Twitter have stated that they too, would refer peers to those companies they follow.

Since actions speak louder than words, the study sought to answer the question of whether or not engagement actually leads to purchases. The answer is yes. An impressive 51% of Facebook fans and 67% of Twitter followers indicated that they are more likely to buy since connecting online. With 450 million users on Facebook and over 100 million registered users on Twitter, the potential is not only great, it’s exponential.

Social Media is a Tool for Customers and Prospects

What compels someone to fan a page on Facebook or follow a company on Twitter? The survey specifically asked the question of its panelists in relation to Facebook and Twitter and their answers may be surprising to many.

Facebook

On Facebook, existing customers topped the list with 49%. Following with 42%, consumers felt compelled to show support for the brand. In third with 40%, individuals admitted that they hoped to receive discounts and promotions.

Other stats worth mentioning, 27% and 26% of respondents stated that they would like to be among the first to know information about the brand and also to gain access to exclusive content respectively. And, 17% claimed that they were referred to the page by someone that they knew, which already demonstrates word of mouth at work.

Twitter

Twitter paints a different picture, but more so than in Facebook, consumers want access.

51% of consumers polled are already customers of the company. 44% stated that receiving discounts and promotions was the primary reason for following. 42% did so for entertainment purposes.

Gaining access to exclusive content and learning about information first with 37% and 36% respectively is also worth noting.

Whereas 17% were referred to Facebook pages, only 12% followed brands on a recommendation. However, as the number two reason for following reveals, Twitter users are ready to make a purchase based on information gleaned from their stream.

Engage or Die

Creating a presence in social networks is mandatory, but it’s also not enough. Actively and thoughtfully engaging consumers in social networks is quickly becoming an expectation. As part of the study, consumers voiced their opinions and sentiment, some of which serves as a wake-up call to businesses everywhere:

“It’s EXPECTED that a company have some digital face – whether it’s on FB or Twitter I don’t know – but they need a strong electronic presence or you doubt their relevance in today’s marketplace.” Female 50-54

“Either they are not interested in the demographic that frequents Facebook and Twitter or they are unaware of the opportunity to get more exposure in a more interactive method.” Male 35-39

“It shows they are not really with it or in tune with the new ways to communicate with customers.” Female 18-24.

“If they’re not on Facebook or Twitter, then they aren’t in touch with the ‘electronic’ people.” Female 55-59

It’s clear. Those brands that focus on prospects and customers through social engagement will open new doors that increase brand awareness and sales through word of mouth. But perhaps more importantly, businesses will also earn expanded relevance in the age of a new and powerful medium.

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This is Part Two of Two in a series exploring the promise and potential of Social CRM and SRM. In Part One, we reviewed the importance of sCRM as well as introduced the concepts of Social Relationship Management (SRM) to look beyond customers in Social Media. Originally intended for inclusion in Engage!, Paul Greenberg contributed his view of sCRM and SRM to continue the discussion…

There is little doubt that customers are ruling the roost right now — to a point that should be of concern to business — and a reason to rejoice. On the one hand, because we are human, we love to complain and thus the virally negative press and publicity that a bad customer service problem can lead to grab much of the headlines. But there is a converse side to the seemingly scary reality that says, “OMG; the customer can talk about my business outside of my control.” It also can mean that the customers, who are not only newly empowered but increasingly pro-active in managing their own experiences and interactions, can become advocates who support you, endorse you and engage others in providing benefits (and sales) to your business.

What makes the changes in the world interesting is that even customer engagement strategies, a radical idea not more than one or two years ago, now need to be nuanced to recognize far more than just customer lifetime value (CLV) which measures how much revenue and profit a customer will bring to you over his or her lifetime with a company. The gradations of traditional CLV analysis incorporated the impact that your business decisions would have on the purchasing behavior of that customer and his immediate family – but not much more than that.

But now, influence matters. That doesn’t just mean the industry pundits either. It means that with the new social tools available, individual customers who could be your friends or enemies could influence tens, hundreds, thousands of people who are not even personally known to them but are “someone like them.”

Don’t underestimate the power of this. The Edelman Trust Barometer, which is the most trusted source for figuring out who the most trusted source is, has indicated that “someone like me” has been the most trusted source since 2004 when it was chosen as that by 51 percent of the respondents. It’s only gone up since and as of 2009 was 58 percent. That peer is who the influencer influences.

This is where Social CRM for business comes in. Not only do you have to identify the value of a customer or person to an institution from their purchasing habits but also their influencer value which is often, at least in the business world, something that can be non-existent one day and have a major impact a week later.

But, it is now so much more than even that. As Brian points out in Engage!, Chapter 23, “The Social Web is distributing influence beyond the customer landscape, allocating authority amongst stakeholders, prospects, and peers.” He even goes so far as to eliminate the “C” in Social CRM because it goes beyond customers. He calls it SRM, I call it the collaborative value chain but it’s potay-to, potah-to. We are now in a world that not only is forcing businesses to engage customers but to consider the influences on their business that rests among their partners, suppliers, prospects…hell, all the stakeholders in the company’s particular ecosystem. This makes business more complex but far more intriguing than ever – with a value proposition and flexible strategy for success that just blows the doors off if carried out effectively.

The best way to measure this business value and a good way to understand the difference between traditional CRM and Social CRM is to look at this influencer value over time. CLV by itself is no longer sufficient. What Dr. V. Kumar, Chairman of Georgia State University’s Marketing Department and the Executive Director of the Center for Excellence in Brand and Customer Management (CEBCM) calls “customer referral value (CRV)” now enters the stream. CRV is a measure of advocacy and positive business value that an influencer brings. It fundamentally acknowledges the existence of the social customer that Social CRM deals with.

The key here is that it shows a measurement that validates the existence of the social customer and the positive impact they may have on a business as advocates.

But that’s not the only part of influence that Social CRM measures. Keep in mind, an advocate is typically known to the company and has a history of interactions with that company — they often come from the ranks of loyal customers.

But what about those influencers who are either not positively interacting with the company or who have had a very few interactions but at the same time can influence large numbers of consumer decisions because of their stature in some community?

PriceWaterhouseCoopers has a set of metrics that they think need to be used to “hear the whispers” on the social web, to find out who those influencers are and what kind of influence they may have. The metrics are:

1. Volume – How many times has this been mentioned versus its historic patterns?

2. Tone – Are they saying positive, negative or neutral things?

3. Coverage – How many sources are generating this volume of conversation?

4. Authoritativeness – What kind of qualitative ranking (reputation) does the individual source have)

Measuring the whispers gives you some idea of how influential someone can be or how fast a trend can grow or what kind of chatter is spreading about your company — good or bad — and who is spreading it.

It’s the ability to capture this unstructured and also structured customer data e.g. transaction information, then measure it and identify both key trends and key individuals that is one of the distinguishing features of Social CRM from just social media.

Optimally, using these measures will help you gain some insight into individual customers and their particular influence. If you then provide them with the personalized products, services, experiences and tools they need to sculpt their own relationship with you, because the customer is prone to trusting “someone like me”, it is entirely possible that they will think of your business as a “company like me.”

That’s some of what Social CRM is. AND that’s a good thing.

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In Engage!, I review the important catalysts and methodologies defining the new era of Social CRM or sCRM. In the discussion, I also introduce the idea of SRM (social relationship management), a concept that may at first blush, seemingly appear to introduce yet another acronym or perhaps challenge the promise of sCRM. However, its only intention is to spur thinking beyond the literal frameworks of traditional customer relationship management, whether it’s social or one-way.

Much of this chapter was cut as the book was already well over its target word count. As it’s an important topic, I’ve reassembled the pieces into a two-part series to spark useful conversation and innovation around the subject.

At a minimum, SRM focuses beyond the social customer and escalates the promise and potential of sCRM across an entire organization, not just customer service. Equally, SRM zooms in to evaluate the various stages of decision making and the channels and people that influence outcomes.

The Culture Shift: CRM to sCRM

If we look at CRM and the methodologies and technologies that support customers today, social CRM represents much more than a modernization or even socialization of an aging system of support and service.

I believe that among the chief attributes of social media, the ability to identify active communities of relevance, trace channels and voices of influence, and also discern and dissect the various stages of decision making, all in real-time, is nothing short of profound and transformational.

Information is becoming commoditized. Conversations, sentiment, inquiries, and intentions are vocalized and open for organization, categorization, and analysis. Our newfound sense of hearing is there for the benefit of learning. Accordingly, adaptation will be the key to earning relevance in our markets and this continuing practice of adaptation is how we will ultimately establish prominence.

This is easier said than done of course.

The culture that prevails within businesses today actually works against the pillars of socialized CRM. As such, everything begins with change and the compelling case to do so. While social media has traveled a great distance from our personal exploration to our profession endeavors, this unstructured groundswell has forced a bottom-up revolution led by us, the social champions who believe that the customer should once again, come first.

Eventually however, we hit a ceiling where the effects of championing change are met with challenge and skepticism. This opposition is natural, as the energy and persuasion necessary to break through the ceiling and impact the entire organization from the top-down, requires much more than enthusiasm.

Before businesses can collaborate within their communities, they first have to learn how to collaborate internally.

As Charlene Li points out in her new book Open Leadership, organizational transformation is only truly attainable through the willingness of leaders to embrace a change of course, act, and do so without having all of the answers. But, neither Charlene nor I endorse changing for the sake of change, nor do I suggest that we take any steps blindly. Instead, I believe in the power of data and as such, I rely on the real-time social information that visualizes impact, influence, sentiment, and opportunities.

Research, analysis, and insight offer clarity and direction. When combined with recommendations for process enhancement and ultimately compelling forecasts, we can then begin to demonstrate the ability to increase customer acquisition, retention, sales, and market share overall. This is the only language, for the time being, that seems to resonate with executives.

Introducing the Mantra of SRM

The premise of SRM is that the Social Web is distributing influence beyond the customer landscape, allocating authority amongst stakeholders, prospects, advocates, decision makers, and peers.  The activities that govern each form the separation and distinction between customer acquisition, retention, and advocacy. I believe at the heart of sCRM methodologies, the recognition that customers are only part of the new equation, sets the stage for long-term and advantageous change.

Every day, customers and prospects are faced with making decisions and the paths that they take are increasingly open to input. People are not only taking to the social Web for options, research, and recommendations, the insight they receive is derivative of the experiences and observations of others.

We reap what we sow.

This is why the concept of SRM shatters the boundaries set forth by CRM and the prevailing methodologies that inspire the progression towards sCRM.

Again, the idea of SRM recognizes that whether someone recommended, purchased, or simply recognized a product or service publicly each makes an impact on behavior at varying levels.

In the realm of SRM, influence is distributed. If we define influence as the ability to inspire action and measure the corresponding activity, the socialization of influence now expands beyond the strategies and software that organize and optimize customer relations and the management processes that govern it.

The entire organization needs to socialize and optimize in order to affect decisions and earn relevance.

Dr. Natalie Petouhoff formerly of Forrester Research called for sovereignty through jurisdiction in her post, Who Should Lead the Customer Social Media Interaction:

“The best strategy for a company is always to have everyone do what they do best. That’s why the various functions departments got created”

Customer service, combined with participation and engagement, forms a powerful foundation of marketing without blatant marketing. And, as the socialization of our business is introduced through open leadership, engagement brings into focus the fifth “P” of the marketing mix – people.

Indeed, this is about people and the recognition of influence wherever and however it takes shape. Equally, this is about relations and relationships. As such, we need principles, guidelines, processes, and systems to identify and engage in relevant communities and corresponding activity to trigger, cultivate and harness the rewards for paying attention and connecting.

This is just the beginning. The road to SRM is rich with insight and it affects the entire organization and in turn, the ability to impact decisions.

In Part Two, Paul Greenberg, author of CRM at the Speed of Light, continues the discussion of sCRM and SRM.

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In celebration of National Small Business Week…

For entrepreneurs, business owners, investors, and consultants, one of the most exciting prospects of social media, lies in the ability to dramatically amplify your visibility and value proposition among existing and potential stakeholders. Social Media finally places small, local and emerging businesses in the spotlight in ways that up until this point, were largely unattainable.

New Media is rapidly shifting the landscape of how people find and share information and much of it isn’t just moving online, it’s connecting people in ways that weave a dedicated network of prospects and advocates within networks that invite your value-added participation. As a result, once scattered customer-bases are now unifying online as concentrated contextual markets, enabling the establishment of bridges and highways between businesses and prospects and ultimately creating new opportunities in the process.

Small Business is Anything But Small

When combined, small business and social media marketing is anything but small. As eMarketer recently noted, small business is doubling adoption of social networks and there’s very good reason for that. Need proof?

The University of Maryland’s Smith School of Business along with Network Solutions recently published its third wave of the Small Business Success Index (SBSI), a study that reveals the extent to which small businesses are embracing social media. The results are staggering and serve as a harbinger of new business dynamics.

Social media adoption among U.S. small businesses doubled in the past year from 12% to 24%. And that’s just the beginning.

61% of small business owners use social media to identify and attract new customers.

75% surveyed have a company page on a social networking site.

45% expect social media to be profitable in the next 12 months.

As part of the study, 500 small business owners shared their experience and expectations of social media. As we can see, creating a presence in social networks ranks at the top of the list, but that’s only the surface. We reveal more insight with each layer we peel back. Of those, 69% are posting updates within their network of choice, with just over half of all business owners focusing on the development of dedicated online communities and also listening to customer feedback.

- 75% reported having a company page on a social network, including LinkedIn or Facebook

- 69% actively post updates on social networks

- 57% are proactively building networks within sites such as LinkedIn or Facebook

-54% monitor customer feedback within social networks

- 39% host a blog to demonstrate expertise

- 26% Tweet about areas of expertise

- 16% use Twitter as a customer service channel

Source: Mashable

Social Media serves as a platform to identify, learn, and connect with customers and prospects along with those who influence their decisions. As in anything, you get out of it what you put into it. The study also examined how small business owners rated the performance of social media tactics against expectations.

At the top of the list, 73% of business owners anticipated that social networks would improve the ability to identify and attract new customers with 61% realizing success today. Of course, visibility is instrumental in earning a position within any cycle of evaluation and decision making and as such, 56% expected to increase awareness within target markets with 52% stating that their objective was met. Engagement is the key to everything and thus, I was surprised to see the numbers for both expectation and accomplishments at only 46% for customer engagement within social networks.

Identify and attract new customers
Expectations: 73%
Accomplishments: 61%

Develop a higher awareness of your organization within your target market
Expectations: 56%
Accomplishments: 52%

Stay engaged with current customers
Expectations: 46%
Accomplishments: 46%

Collaborate more effective externally, such as with suppliers, partners, and colleagues
Expectations: 34%
Accomplishments: 35%

Collaborate more effectively internally
Expectations: 26%
Accomplishments: 21%

Other
Expectations: 12%
Accomplishments: 9%

Monetization of social media is of course, at the top of the list for all business owners. They want to know that their efforts will pay off, sometimes trumping patience and strategy. Nearly 1/2 believe that social media will make money within the next 12 months and another 53% suggest that their investment in social is already breaking even.  Surprisingly, only 9% stated that social will lose money, but 22% reported that their engagement within social networks is already paying off.

Overall, 58% believe that social media has met their expectations. And, herein lies the true opportunity. As we all think about what we know in terms of social networks, we realize that possibilities and success are practically infinite and that learning and experience are practically equalized for everyone. Those who experiment and practice become the veterans in a new medium abundant with students and starved of teachers. That’s why this is such an incredible time.

This is your time to engage and become the expert you seek. By answering our own questions, we can participate in social networks in ways that boost visibility, attract customers, and empower a team of advocates to create new business opportunities, improved customer service, and also a more valuable service offering as tuned by our stakeholders.

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