circos tapping into social media (a)

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Singapore Management University

Institutional Knowledge at Singapore Management University

Case Collection Case Writing Initiative

5-2012

Circos: Tapping into Social Media (A)Kevin W. SprouleSingapore Management University, [email protected]

C Jason WoodardSingapore Management University, [email protected]

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more information, please email [email protected].

CitationSproule, Kevin W. and Woodard, C Jason. Circos: Tapping into Social Media (A). (2012). Case Collection.Available at: hp://ink.library.smu.edu.sg/cases_coll_all/14
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SMU-12-0010

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SMU-12-0010 Circos: Tapping into Social Media (A)

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historic role as a regional trading hub at the centre of its development (refer to Exhibit 1 formore history and economic facts about Singapore). As a major centre of trade along importanttrading routes, it continued its role as a transportation hub, and in 2011, it operated the worldssecond busiest port and the 17thbusiest airport. Singapores Ministry of Trade and Industryreported that the trade to GDP ratio was nearly 300%, the highest in the world. 2 In 2011 theInternational Monetary Fund listed Singapores GDP per capita as the 11thhighest in the world(at US$ 50,714) putting it higher than countries like Finland and the United States.3 Thehistorical trade focus of the city-state had translated into a present-day emphasis, as Singaporebecame a thriving community for ideas and innovations and a popular tourist destination at theheart of Southeast Asia.

The Interactive Digital Media Ecosystem in Singapore

Owing in part to its history as a commerce hub, Singapores government had a strategic focusto cultivate an exciting community of entrepreneurship and idea creation. Through the efforts

of organisations like the Media Development Authority (MDA), key industries were catalysedwith funding and expertise to encourage Singapores success.

Founded in 2003 through the merger of the Singapore Broadcasting Authority, the Films andPublications Department and the Singapore Film Commission, the MDA had worked to createa fast-growing ecosystem for media development in Singapore. Through direct support,fostering collaborative relationships amongst media companies and creating a hub forinternational talent, Singapore was becoming a destination for the global interactive digitalmedia sector. In 2009 MDA Chairman Niam Chiang Meng commented on the strongcontribution of the media sector to the Singapore economy, accounting for SG$ 24 billion(US$ 19 billion4) out of SG$ 270 billion (US$ 216 billion) in annual economic output.5 Overallthe MDAs support for this thriving ecosystem was guided by three key values: Engaging

Singaporeans, Boosting Industry, Transforming the Economy. Levers at its disposal includedthe ability to make strategic investments and provide financial support to activities that createdjobs in Singapore, initiatives to attract and work with leading media companies to develop newcontent and innovative media services for the Singapore market, and a variety of efforts tofoster collaboration and growth across the media-related industries.

In 2006 the MDA established a dedicated programme office to focus on research anddevelopment initiatives related to Interactive Digital Media (IDM). The IDM ProgrammeOffice was charged with fostering an environment for highly interactive and engaging digitalmedia (refer to Exhibit 2for the types of media that were classified as IDM).

As an engine of economic growth, the IDM space outpaced even the broader media sector as a

whole. A 2011 study commissioned by Deloitte South East Asia reported strong growth overthe last four years despite tepid overall growth in the worldwide economy. 6 In the studyDeloitte estimated that value added by IDM companies in Singapore grew at an annual rate of26% and employment grew by 22% between 20072010. IDM revenues also saw strongperformance relative to the broader economy and grew at an annual rate of 22% between 2007and 2010. This was especially strong when compared to Singapores overall annual GDP

2 Annual Statistics, Ministry of Trade and Industry Singapore, accessed May 18, 2012,http://app.mti.gov.sg/default.asp?id=725#93 World Economic Outlook Database, International Monetary Fund, September 2011, accessed May, 18, 2012,http://www.imf.org/external/pubs/ft/weo/2011/02/weodata/index.aspx4 On 1 March 2012, US$1 = 1.2488 SG$: US Dollar ($) / Singapore Dollar (SGD), Google Finance, accessed May 18, 2012,http://www.google.com/finance?q=USDSGD5 Media Development Authority, 2010 Annual Report, March 31, 2011, 3, accessed May 18, 2012,http://www.mda.gov.sg/ABOUTUS/Pages/Annualreports.aspx6 Interactive Digital Media (IDM) IDM Takes Flight, Deloitte South East Asia Ltd, 2012


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growth during that time of about 5%.7 An area of particular promise was the rapidly emergingmarket for real-time customer insights distilled from the vast amount of information that wasnow available on social media platforms.

The Global Social Media Explosion

In the 1990s when the Internet became widespread it brought with it dramatic changes in theway people searched for and consumed information. This era, often labelled Web 1.0 inhindsight, featured a proliferation of websites with either static or database-driven content andthe growing use of email for private communication. By the middle of the next decade,observers were heralding the arrival of Web 2.0, which was characterized by a shift towardmore dynamic media that featured user-generated content and provided a two-way dimensionto what had largely been a one-way flow of information. This meant that users not onlyinteracted with information published by others, but were also authors and publishersthemselves. Common forms of media associated with Web 2.0 included blogs (originally short

for weblogs) and collaborative websites such as Wikipedia, an online encyclopaediacomprising millions of articles written and edited by users.

By 2010, yet another shift was underway: the era of social media had arrived. The Merriam-Webster dictionary defined social media as, Forms of electronic communication (as Web sitesfor social networking and microblogging) through which users create online communities toshare information, ideas, personal messages, and other content.8 While this bland descriptionsufficed as a definition, it did little to capture the dynamic and vibrant ecosystems that haddeveloped with the rise of social media, whose pervasive reach had begun to reshape manydaily activities, from interactions with friends to purchase and consumption behaviour to theway teachers assigned homework, just to name a few. The scale of social media grew at astaggering rate. In 2011 there were 700 million Facebook users, one billion daily YouTube

views, 200 million Twitter users and over 600 million users of popular messaging service QQin China.9 The scope, scale and impact of these communities were growing quickly. Forexample the Pew Research Center reported that in 2011 nearly two-thirds of Americans usedsocial networking and a full 13% used Twitter, nearly doubling from 2008.10

Social media had also shown how it could impact the opinion and actions of its users. Forexample ideas or trends could catch on quickly, such as when videos went viral on YouTube.This was a phenomenon where through recommending content to contacts within social mediacircles a video or other publication would be viewed by millions of people, often surpassing theexpectations of the producer.11

Not surprisingly, many businesses were looking for ways to monetise the behaviour of social

media users, primarily through advertising. Social media advertising mainly took the form ofplacing targeted advertisements on popular social media platforms. This was coupled with anunprecedented ability for advertisers to select their target audience with the trove of richcustomer information. For example with tools provided by Facebook it was possible for acompany to target a male consumer between the ages of 2030, who had lived in Singapore for

7 Economic Survey of Singapore, Ministry of Trade and Industry Singapore, February 2011, accessed May 18, 2012,http://app.mti.gov.sg/default.asp?id=148&articleID=242218 Definition of Social Media, Merriam Webster Dictionary, accessed May 18, 2012, http://www.merriam-webster.com/dictionary/social%20media9 Sng, Dennis, IDM Futures (presentation for the Media Development Authority 2011).10 Twitter Update, Pew Research Center, June 1, 2011, accessed May 18,2012, http://pewinternet.org/Reports/2011/Twitter-Update-2011.aspx11 Examples ranged from Why This Kolaveri Di (where an Indian actor sang a popular Indian song with English lyrics) whichgarnered 48 million views, or KONY 2012 which saw a non-profit group generate over 75 million views of its video in just oneweek.


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less than a year, and was interested in travel. This level of specificity was very powerful as itallowed advertisers to align their ad placements to drive short-term business objectives such asincreased bookings for a particular hotel in the next month. Due to advertisers relativeinexperience in taking advantage of these capabilities, social media advertising was stillrelatively inexpensive compared to more established forms of online advertising like traditionalbanner ads and keyword search advertising, although this was changing quickly.

In 2012 the full potential of social media to permeate global societies and transform businessmodels had not yet been reached. One clear trend was that sharing information quickly andeasily across borders meant that consumers purchase decisions were prone to be influencedlike never before. In particular the travel and tourism industry saw fundamental changes in howits consumers bought their products and services.

Travel and Tourism Goes Online

Globally, travel and tourism was a thriving business. According to the World TourismOrganization, a United Nations agency, 2011 was a record year for tourism worldwide,accounting for more than 5% of global GDP and up to 25% of economic activity in somecountries.12 The agency projected that during 2012 over one billion people would have made atleast one international trip generating more than one trillion dollars in receipts. The reasons forinternational trips varied with 51% traveling for leisure, 27% to visit relatives or for religiousreasons, 15% for business and 7% for other reasons.13 Analysts further subdivided the tourismindustry into several sectors, including hotels and lodging, air and other transportation, vacationpackages and attractions.

The conventional way to book travel had been to connect directly with a travel supplier or liaisethrough a travel agent that often had a physical presence such as a store or kiosk. With the

advent of the World Wide Web, consumers gained numerous alternatives to connect with travelsuppliers. Online travel agents started to provide access to travel bookings, and search enginesand online advertisements sent consumers directly to supplier websites. To handle theexpansive network of online travel agents, such as Orbitz and Expedia, along with directsupplier websites, such as Singaporeair.com, there was a rise in metasearch websites. Thesesites, such as Kayak.com, aggregated data by searching many different suppliers and onlinetravel agents at once.

The increased use of various travel portals that connected travel consumers and suppliersushered in a shift in the way people made their purchases. For example, in 2011 the PewResearch Foundation found that 65% of adult Internet users in the U.S. booked or made a travelreservation online, a greater percentage than those who used social media sites.14 While buying

an airplane ticket was the first area of travel to move online, hotels and lodging were followingsuit. By 2015 Euromonitor, a market research firm, estimated that 20% of all hotel bookingswould be made online.15

With the rise of Web 2.0 came another shift in the industry as more people both purchasedtravel products online and researched them there as well. Websites like TripAdvisor purportedto provide unbiased reviews on things like destinations and hotels with over 60 million userposts and 50 million monthly visitors.16 This information filled a need of many travellers who

12 Introduction, The United Nations World Tourism Organization, accessed May 18, 2012 http://unwto.org/en/content/who-we-are-013 UNWTO Tourism Highlights, United Nations World Tourism Organization, June 2011, 3.14 Trend Data, The Pew Internet & American Life Project, February 2012, accessed May 18, 2012, http://pewinternet.org/Trend-Data/Online-Activites-Total.aspx15 Unleashing the Power of Social Media on Travel, Euromonitor, February 2011, 31.16 About TripAdvisor, TripAdvisor, accessed May 18, 2012, http://www.tripadvisor.com/pages/about_us.html


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often spent significant amounts of money to stay in hotels they had never been to before. Forexample in 2011, 78% of U.S. Internet users looked online for information about a service orproduct they were thinking of buying. Also eager to give advice, 32% of U.S. Internet usersposted a comment or review online in 2011.17

This trend had cultivated a marketplace where reliance of reviews and advice from friends (andat times complete strangers) aided in planning upcoming travel. On portals like TripAdvisorconsumers could rate, review and recommend various attractions, restaurants, destinations andhotels. This was seen by many consumers as a great place to get unbiased opinions andfeedback about trips to places they had never been. Various companies in the travel and leisureindustry, notably hotel operators, had begun to take notice of these comments. A hotel could,for example, react instantly to complaints, create user groups for loyal customers, and get vastinformation about the performance of a particular property. The nature of social media in thetravel space also created some challenges, which included the interpretation of vast amounts ofinformation, the large impact one or two very negative reviews could have and the importanceof monitoring a brand image when things could change so quickly. In addition to the wealth of

information available by a review of existing social media information, several companies alsotook a very active stance in advertising their brands through social media platforms.

The Growth of Tourism in Asia

The tourism business in Asia had seen growth with the regions rise in prominence andaffluence. Between 2001 and 2011 the GDP of Asian economies rose at an average annual rateof 14.2% and went from 19% of the global total to nearly 30%. 18 This growth was especiallystrong when compared to the worlds seven largest economies, which grew at an annual rate ofabout 3% over the same period. The ten-year period also saw the purchasing power of residentsin developing parts of Asia more than double.

Along with this rise in affluence came more discretionary spending on travel. Across Asia,travel was understandably correlated with wealth, and with rising wealth came moreinternational trips tilting away from less expensive domestic travel. China alone accounted for35 million international trips in 2009.19 With low-cost airlines such as Singapore-based TigerAirways and Malaysia-based AirAsia, many of these international trips were taken within Asia.In 2009 Euromonitor estimated that 70% of visitors to Asian countries were from within Asia,and this trend would persist in the years to come. Top destinations included China, Malaysia,Hong Kong and Singapore (refer to Exhibit 3for international visitors to Asian countries).

Raffles Hotel: A Singapore Icon

In her 2003 book, 1,000 Places to See Before You Die, Patricia Schultz listed Raffles Hotel asone of three must-see attractions in Singapore.20 Among the elite company of SingaporeanStreet Food and The Eastern & Oriental Express, Raffles Hotel was a true icon of the city.The hotel first opened its doors for business on 1 December 1887 and was named afterSingapores modern-day founder, Sir Stamford Raffles.21 It began its history in fine style,bringing new refinements to the British colony, including the islands first electric lights,

17 Trend Data, The Pew Internet & American Life Project, February 2012, accessed May 18, 2012, http://pewinternet.org/Trend-Data/Online-Activites-Total.aspx18 World Economic Outlook Database, International Monetary Fund, September 2011, accessed May, 18, 2012,http://www.imf.org/external/pubs/ft/weo/2011/02/weodata/index.aspx19 Asia Travel and Tourism: Promise of Long-term Growth, Euromonitor, August 2010, 8.20 Patricia Schultz,1,000 Places to See Before You Die(New York: Workman Publishing, 2003)21 The History of the Raffles Hotel Singapore, Raffles Hotel, accessed May 18, 2012,http://www.raffles.com/singapore/history/history/


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electric fans and French chef. The hotel continued on its path towards international fame withevents including the creation of the celebrated Singapore Sling cocktail by Ngiam Tong Boonat its hotel bar, and the dubbing of Raffles as the most magnificent establishment of its kindeast of the Suez in a 1902 newspaper article.22

The hotels reputation seemed only to grow, with its guest list reading like a Whos Who ofthe times. Guests included everyone from the Queen of England to Elizabeth Taylor. In 1991the hotel underwent an extensive renovation, which consisted of room upgrades and theaddition of shops and restaurants to the various wings of the hotel. Awards continued to pile up,including the Best Individual Hotel in Asia Pacific award in 1997 from the Pacific Asia TravelAssociation and a 2004 Conde Nast Travelerreaders poll that listed the hotel as number one inAsia. The Singapore icon was set to celebrate its 125th anniversary with great fanfare inDecember 2012, marking another milestone in the long history of an establishment whosemagnificence had proved remarkably durable.

Circos: The Beginning

Reflecting on the illustrious surroundings at the Raffles, Langlois mused that even the mostsuccessful businesses began with the spark of an idea and an entrepreneur willing to take a risk.In the case of Raffles Hotel, the spark was struck by the charismatic Sarkies brothers, who setout to establish the first luxury hotels with a strong emphasis on service in South East Asia. Inthe case of Circos, the entrepreneurial role was played by the companys three founders, MorrisSim, George Mitchell and Mario Jobbe, who met in 2002 while working at Microsoft.

After working for three years on a project to understand the relationship between onlinesentiment and revenue generated from Microsoft products, the three co-founders began tounderstand how social media could lead to profit. They also saw that the rise in social media

could lead to big things. Years later, Jobbe commented about that moment:

After the initial work at Microsoft, we saw this wave that was coming with social, and weall said lets go and do this. We knew we wanted to do something with social but didnthave an immediate sense of what that would be.

They started to incubate technologies based on analysing online reviews and their impact onpurchase decisions. Sim, described as the big picture thinker, took on the role of CEO; Mitchell,with his proven ability to see the potential in technology, took on the role of CTO; and Jobbe,with his ability to connect the dots, took the role of COO. The founders evaluated a number ofdifferent businesses that could benefit from this aggregated view of consumers viewpoints asexpressed across social media platforms. Jobbe described how they ultimately chose the

hospitality space to be the focus of their new business:

We looked at a bunch of different categories when we first started. We did someexperiments with other categories, specifically books and media, and other more product

focused topics. While they were interesting we found that in terms of a clear business model,consumers use social media directly in making a travel purchase decision.

If a consumer is going to spend US$300 per night on a hotel room and they have neverbeen to Hong Kong they are going to read reviews and that will have an impact on wherethey stay. If you are going to buy a book for US$15 reviews have a different impact on the

purchase decision. Ultimately we experimented with several different categories but ended

22

The History of the Raffles Hotel Singapore, Raffles Hotel, accessed May 18, 2012,http://www.raffles.com/singapore/history/history/


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up in hospitality because of the clear relationship between the research in social media andthe purchase decision that the consumer makes.

In 2005 the team started off their work in Silicon Valley, California, but was already looking tomake the move to Asia to tap into the Chinese and Japanese speaking markets. As Jobbe put it:

We started in the Bay Area, but we knew from the beginning that social media in Asia wasgoing to be huge and different than in the West.

The young company sent out several requests to software companies worldwide for proposalsto develop a prototype for their new technology. They ultimately selected a partner inSingapore, which drove their decision to locate their business there. Singapore rose to the top ofthe list for its talented workforce, proximity to key markets and ease of doing business. By2006 the initial development work was underway, and in 2007 Circos was incorporated as aSingapore-based entity. Spurred along by grants and support from the IDM Programme Office,the development of the companys core technology proceeded quickly. The business took offafter 2008 when competition in the hotel industry escalated due to the global slowdown in

leisure and business travel, prompting hotel chains to take a keener interest in their onlineprofiles. Over the next four years the company hired over 50 employees in four countries andbuilt relationships with several of the worlds largest hotel chains.

Circos in 2012

By May 2012, Circos had grown from a tiny start-up company into a sizable venture that wassuccessfully monetising its core technology, a sentiment analysis engine, by providing detailedmarket information to leading hotel brands. Using pioneering computational techniques, Circoswas able to present nearly real-time snapshots of a hotels performance by extracting publicly

available information from blogs, travel sites like TripAdvisor and social media platforms likeFacebook and Twitter. By providing meaningful and actionable synthesis of this information,which included user-generated ratings and comments about nearly every hotel in the world,they positioned themselves as a unique provider of comprehensive market research to thehospitality industry.

Brand Karma Dashboard

This feat was achieved through the companys sentiment analysis tool, which they called theBrand Karma Dashboard. This tool allowed a hotels general manager to review informationabout the property, starting from high-level analytics on the hotels performance and drillingdown to individual reviews posted by guests. The Brand Karma Dashboard provided hotels

with the ability to compare data across brands, geographic locations, and property types. Therewas an initial view based on four metrics:

1. Guest Satisfaction This score measured the positive and negative guest comments ona property.

2.

Guest Loyalty This score was derived from customers who would recommend thehotel to others as a proxy estimate of overall guest loyalty.

3. Consumer Awareness This score was calculated based on the total numberof reviewson a given property relative to the competitor set. This measurement attempted todescribe how many people were talking about a particular property on social media.

4.

Frequency of Reviews This score was calculated based on the averagelength of time

between reviews. This was compared to the other hotels in that market.


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The dashboard also included more detailed statistics on particular drivers of hotel performance.Attributes like arrival, beds, service, bathroom and price were all specifically tagged if theywere mentioned in a review and would be analysed and presented in the dashboard. This meanta hotel general manager could look at any number of drivers to target specific focus areas forthe property and its team.

The Consulting Business

In addition to subscription revenue from the Brand Karma Dashboard, Circos had seen stronggrowth in its consulting arm. Circos consulting activities aimed to help hotels expand andimprove their presence in the social media space using the tools and data at the companysdisposal. This could take many forms. A consulting team would often start with a small socialmedia campaign to demonstrate its effectiveness and then gradually increase the level ofengagement to include full responsibility for managing the clients social media presence.Overall these services were targeted towards luxury hotels, which were in the best position totake advantage of actionable insights provided by Circos.

As a result of its extensive work in planning and executing campaigns for its clients, Circos wasa preferred Facebook advertiser and had also gained experience in creating and monitoring fanpages. Depending on its scope and the tactics employed, the effectiveness of a campaign couldbe measured in a variety of ways, including traditional metrics such as click-through rates andconversion rates as well as newer ones like increases in the number of Facebook fans. Inaddition, there was a strong complementarity between the consulting business and the BrandKarma Dashboard, which could be used both to generate ideas for campaigns based on whatpeople were saying about a brand and to measure changes in attitudes or perceptions toward abrand as a result of a campaign.

Competitive Landscape

Although Circos had built up substantial intellectual capital and enjoyed a strong marketposition, there was stiff competition in the emerging market for social media analytics. Circosdivided its competitors into two groups: tool providers and agencies. The tool providers werecompanies that produced sentiment analysis tools to display information synthesized fromonline content such as product reviews. Within the tools category, some companies like fellowSingapore company Brandtology were horizontally oriented, serving a variety of industriesusing a general-purpose approach. Circos main competition was from vertically-orientedcompanies that specialised in products designed specifically for hotels. Some examplesincluded Revinate in the U.S., ReviewPro in Spain and TrustYou in Germany, all of whichproduced competing tools targeted at hotel chains.

The competition for the consulting business was primarily full-service advertising agencies likeOgilvy & Mather and Publicis Groupe. These companies were typically hired to produce largeintegrated advertising campaigns, often including traditional media (e.g., print and TV) inaddition to online channels. Circos was strictly focused on social media advertising, which wasoften a small fraction of a large campaigns budget. While some clients preferred the one-stopcapabilities offered by the full-service agencies, Circos had an advantage in selling to clientswho valued its specialised knowledge and experience.

The Raffles Hotel Opportunity

Returning his attention to the task at hand, Langlois considered the financial data on his slidesand what it meant for Raffles Hotel in the years to come. In 2010 Euromonitor reported that


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each of the hotels 103 rooms earned an average of SG$ 245,000 (US$ 196,000).23 This wasover 40% higher than its closest competitor (refer to Exhibit 4for profiles of competing hotels).Although revenue per room was high, competing properties were often several times largerthan Raffles Hotel like The Ritz-Carlton Singapore at six times as many rooms and The St.Regis Singapore at three times as many. While Raffles Hotel was able to maintain higher roomrates, this meant that it would need to command a significant price premium above and beyondits competition to generate similar revenue. In 2010 the property took in estimated roomrevenue of SG$ 25 million (US$ 20 million), well behind its competitive set.

Further pressure was placed on the hotel as the overall supply of hotel rooms in the Singaporemarket increased. In particular, expansions at integrated resorts included new destination hotelsalong with casinos and other amenities. In 2010 Resorts World Sentosa opened six new hotels:the Hard Rock Hotel, Hotel Michael, Festive Hotel, Equarius Hotel, Spa Villas and CrockfordsTower. 2010 also saw the opening of Marina Bay Sands, an integrated resort with unspoiledviews of the skyline and Marina Bay, adding 2,600 luxury hotel rooms. Euromonitor reckonedthat Singapore had added nearly 12,000 rooms between 2005 and 2010, an increase of 30%.

The large increase in supply had been driven up in response to an increase in demand, but witha soft global economy, tourism had fallen short of expectations.

The Market for Chinese Travellers

In particular Langlois wanted to leverage the ability for Raffles Hotel to benefit from the rise ofconsumers coming from China. The rest of the world looked set to continue slow growth duringits fitful recovery from the financial crisis of 2008. This meant that most of the new traveldollars in the market were coming from Chinese travellers. In the past Chinese tourists had nottravelled much for leisure, and when they did the trips were mainly domestic. By 2009 thistrend had seen a measured change and nearly 60% of Chinese citizens took a leisure trip. 24 Bycomparison other large countries in the region with lower average incomes travelled much less

than China, including India at about 5%, the Philippines at 15% and Vietnam at 25% of thepopulation taking leisure trips. This was in large part due to the rising affluence of the Chineseconsumer as per capita GDP had grown much faster there than in neighbouring countries.

This meant that the growing market saw a huge influence from this group. In fact Singaporewas the fourth largest destination in Asia, behind only China, Malaysia and Hong Kong. Thesmall island nation received more visitors than Thailand, Japan, Indonesia or South Korea(refer to Exhibit 3 for international visitors to countries in Asia).

Overall Singapores market for leisure travel was large and becoming increasingly Chinese.With this came the need to educate new travellers. Many travellers had never gone abroad andprogressively more relied on social media and reviews to make travel and purchase decisions.

In 2009 Chinese citizens travelling abroad booked only 20% of their travel online, but thatnumber was growing quickly.25 More developed Asian countries had seen a rise in onlinepenetration for travel bookings with South Korea at over 80% and Taiwan at over 40%. In 2010Singapore hotels benefited from this trend with online hotel bookings increasing 33% from theprior year.26

It was clear that the market for Chinese travellers in Singapore was large and growing. Langloislooked over the results from the Raffles profile and saw an opportunity in the less favourablereviews from Chinese respondents. After all this could be an opportunity to help the hotelovercome barriers to attracting a growing and potentially profitable customer segment.

23 Travel Accommodation: Singapore, Euromonitor, May 2011, 4.24 Asia Travel and Tourism: Promise of Long-term Growth, Euromonitor, August 2010, 8.25 Asia Travel and Tourism: Promise of Long-term Growth, Euromonitor, August 2010, 37.26 Travel Accommodation: Singapore, Euromonitor, May 2011, 6.


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Putting Brand Karma to Work

At his desk the previous day, Langlois had looked over the sample social media reports theyproduced for Raffles Hotel in early April. This view included the last twelve months of socialmedia data collected between February 2011 and March 2012. He started with the dashboardview, looking first at the English reviews on sites like TripAdvisor and Hotels.com (refer toExhibit 5 for the Circos dashboard of social media posts in English). From there he moved tothe reviews written in Chinese, which surprisingly did not list the hotel as favourably (refer toExhibit 6 for the Circos dashboard of social media posts in Chinese). He then moved to an areathat appeared particularly weak on the Chinese reviews: Hotel Awareness. Not only did RafflesHotel score poorly for awareness amongst Chinese users, it also seriously lagged behind itscompetition in Singapore (refer to Exhibit 7for awareness ratings for Chinese reviews).

Langlois was convinced Raffles Hotel would want to know this. He also knew that brandperceptions could have changed in the weeks since the reports were produced. He wonderedwhat additional insights he could learn with a more thorough review of the very Brand Karma

Dashboard he was trying to sell to Raffles Hotel. After all, his challenge was how to construct apersuasive pitch to communicate the benefits of the tool to the hotels management. Thinkingmore broadly, he also saw an opportunity to develop a comprehensive plan to manage thehotels social media presence.

Crafting an Effective Social Media Campaign

Social media advertising campaigns were still relatively new compared to more establishedprint and televised campaigns. They had been used to achieve long-term objectives for a brandsuch as building awareness of the brand among its target customers (e.g., the Hyatt GroupInternational campaign that increased their Facebook fans from 22,000 to over 160,000 in one

year). The young market had plenty of good and bad examples of how to run a successfulcampaign and how to fall flat on your face. Langlois thought back to one such campaign that hefelt was a perfect illustration of exactly what notto do.

The 2011 Qantas Airlines social media campaign was launched just three weeks after labourdisputes grounded hundreds of the companys flights.27 The work stoppage had impacted thetravel plans of nearly 68,000 passengers across the world and saw a strong rebuke from theAustralian Prime Minister.28 When Qantas did start flying again on 1 November 2011,considerable bad press had been generated and various social media channels were filled withposts spelling out disappointment from customers about travel plans that had fallen victim tothe work stoppage. On 22 November 2011, in the wake of the highly publicised labour dispute,Qantas launched a social media campaign on Twitter with the following post:

Qantas Airways To enter tell us What is your dream luxury inflight experience? (Becreative!) Answer must include #QantasLuxury Nov 22nd

The social media campaign was met with quick response from sceptical customers who sharedseveral sarcastic answers such as taking off or Flights that leave on schedule becauseManagement doesnt arbitrarily shut down the airlines (refer to Exhibit 8for the full reactionto the Twitter campaign).

Langlois thought about how much timing meant to a social media campaign, and the Qantas

27 How to (Really) Fail at Your Social Media Campaign, Brand Karma, November 29, 2011, accessed May 18, 2012http://www.brand-karma.com/university/articles/case-study/how-to-really-fail-at-your-social-media-campaign/28 Qantas to Fly Again After Fair Work Terminates Dispute, ABC News, October 31, 2011, accessed May 18, 2012,http://www.abc.net.au/news/2011-10-31/qantas-action-terminated-fair-work-rules/3609158


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example was a clear case of where it could go terribly wrong. He had also seen severalsuccessful campaigns that could serve as a model of the upside of an effective social mediacampaign. In 2010, Tippex, a company selling correction fluid to paint over mistakes ondocuments, launched a very successful campaign on YouTube.29 The channel, initiated in timefor the back-to-school season, featured a create your own adventure video asking users tocomplete the end of the story between a hunter and a bear. The interactive YouTube channelquickly gained popularity generating more than 50 million views with an average brandexposure of five minutes for the product that resulted in a 30% sales increase in the productsmain markets in Europe.30 The campaign captured a unique and interactive experience thathighlighted the functionality of the brand and resulted in a direct impact on the companysbottom line.

The Presentation

Langlois wanted to make sure that he presented what an effective social media campaign could

mean for Raffles Hotel, and also how active management could help avoid pitfalls seen fromother companies who had made mistakes. This would all be part of his overall pitch at the salesmeeting with Raffles hotel management.

He first wanted to sell them the idea of using a social media-monitoring tool, specifically theBrand Karma Dashboard. Next Langlois would also need to present a social media advertisingcampaign that would show them the potential benefits of working with Circos. He wanted tostart with a description of what Circos consulting services could do above and beyond theinformation presented in the Brand Karma Dashboard. He would present a consulting proposalfor a campaign with a baseline budget of SG$ 25,000 (US$ 20,000). He was not sure how muchthe hotel would be willing to spend, but wanted to give them a sample campaign to show themwhat they could achieve.

Langlois put down his cup and walked across the lobby to join Anne Girard. Two members ofthe Circos team and several other key decision makers from Raffles Hotel then joined Langloisand Girard. They stepped into an ornate meeting room and exchanged pleasantries as he loadedhis PowerPoint slides and got ready to kick off the presentation.

29 A Hunter Shoots a Bear!, accessed May 18, 2012, http://www.youtube.com/watch?v=4ba1BqJ4S2M30 Google AdWords Agency Blog, Google AdWords, July 1, 2011, accessed May 18, 2012http://adwordsagency.blogspot.com/2011/07/youtube-debutes-behind-scenes-look-at.html


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EXHIBIT 1: BRIEF HISTORY OF SINGAPORE

Source: Google Maps

As the story goes, when the prince of Srivijaya, an ancient Malay empire, landed in present daySingapore in the 14thcentury he encountered a mystical creature that he identified as a lion.31

Seeing this as a fortuitous sign he established a settlement and changed the name of the islandfrom Temasek to Singapura, which was derived from the Malay words for lion (singa) and city(pura). In 1819 Singapore became a trading destination for European powers with the arrival ofSir Thomas Raffles.32 By 1824 Raffles, an agent of the British East India Company, hadfacilitated the purchase of the island by Britain. In 1869 the Suez Canal was opened whichshortened trade routes and increased traffic at the already busy Singapore port situatedstrategically along the burgeoning South East Asian trade routes. In 1963 Singapore, which hadbeen a British colony, briefly joined Malaysia and then separated after a series of disputes withKuala Lumpur. Officially celebrating its independence on 9 August 1965, Singapore became anindependent republic. With limited land and few natural resources, the young government had aunique challenge to create a world-class economy.

In 2011 the Economic Survey of Singapore listed the five biggest contributors to the Singaporeeconomy as Manufacturing (20.9%), Wholesale & Retail Trade (17.4%), Business Services(14.1%), Finance & Insurance (11.9%) and Transport & Storage (8.2%).33 Singapore had avery developed economy with an increasing fraction of activity moving away frommanufacturing and into services. In 2010 the World Bank reported that 72% of the Singaporeeconomy was contributed by the service sector.34 This compared to services contributions of73% in the European Union, 74% in Japan and 77% in the United States. In line with this focuson services and trade, the economy boasted thriving financial and media sectors.

31 Barbara Leitch Lepoer, Singapore: A Country Study. (Washington: GPO for the Library of Congress, 1989)32 Background Note: Singapore, U.S. Department of State, accessed May 18, 2012, http://www.state.gov/r/pa/ei/bgn/2798.htm33 Economic Survey of Singapore 2011, Ministry of Trade and Industry Singapore, accessed May 18, 2012,http://app.mti.gov.sg/default.asp?id=148&articleID=2724134 Services, Value Added (% of GDP), The World Bank, accessed May 18, 2012,http://data.worldbank.org/indicator/NV.SRV.TETC.ZS


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EXHIBIT 2: DIGITAL MEDIA IN SINGAPORE

The Interactive Digital Media Programme Office (IDMPO) classified digital media into thefollowing types:

(1) Born-Digital Digital media which do not have an analogue equivalent, e.g., Internetcontent, video games, mobile applications and services.

(2) Going-Digital Traditional media which are undergoing transformation in both theircontent and the way they are transmitted, e.g., TV, radio, film, video, publishing and music.

(3) Embedded Digital media that are being used in industries that are not traditionallyassociated with IDM. Industries that can potentially be transformed by IDM include industrialdesign, medicine, healthcare and education.

In addition to segmenting its efforts by media type, the IDMPO developed initiatives related to

a number of cross-cutting themes. One such theme was the development of Real-TimeContextual Insights (RTCI). The RTCI initiative sought to position Singapore as a leader inunderstanding and analysing consumer sentiment expressed through social media. Effortsrelated to RTCI focused on using real-time information to understand consumer preferencesthrough rigorous analytics, with the aim of creating actionable (and potentially monetizable)predictive insights. IDMPO staff believed that building a reputation for expertise in RTCItechnologies and practices would help position Singapore and its IDM ecosystem for leadershipin the rapidly evolving social media market.

Source: About Interactive Digital Media Programme Office http://www.idm.sg/about/idmpo/


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EXHIBIT 3: ANNUAL VISITORS AND RECEIPTS FOR TOP DESTINATIONS IN ASIA

Source: Asia Travel and Tourism: Promise of Long-term Growth, Euromonitor, August 2010, 13-14.

EXHIBIT 4: SELECTED LUXURY HOTELS IN SINGAPORE

Source: Travel Accommodation: Singapore, Euromonitor, May 2011, 4.

*Source: Singapore Tourism Sets Record, Global Gaming Business, February 28, 2011, accessed May 18,

2012, http://ggbmagazine.com/issue/vol-10-no-3-march-2011/article/singapore-tourism-sets-record

2009 () 2014 () 2009 () 2014 ()

45 55 37 60 23 31 14 22

17 18 12 19

16 19 9 12

14 17 13 17

10 11 13 16

8 10 4 6

7 9 12 19

7 8 8 11

6 8 3 4

5 6 11 22

( ) ($ )

()

()

* 2,600 258 84% 80,000

1,261 290 87% 92,000

608 450 88% 144,000

403 400 85% 124,000

. 299 560 91% 186,000

255 540 84% 165,000

103 790 85% 245,000


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EXHIBIT 5: RAFFLES HOTEL BRAND KARMA DASHBOARD ENGLISH REVIEWS


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Source: Circos Internal Information


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EXHIBIT 6: RAFFLES HOTEL BRAND KARMA DASHBOARD CHINESE REVIEWS


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EXHIBIT 7: RAFFLES HOTEL AWARENESS CHINESE REVIEWS



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EXHIBIT 8: QANTAS TWITTER CAMPAIGN

The Qantas Twitter campaign generated a significant amount of buzz with its original Twitter

post on 22 November 2011:

Qantas Airways To enter tell us What is your dream luxury inflightexperience? (Be creative!) Answer must include #QantasLuxury Nov 22nd

According to social media expert James Griffin, within hours of its posting the hashtag

#QantasLuxury received over 50 tweets per minute from Australians.35 A sample of replies

included:

jasonium Taking off. #QantasLuxury

stephendann Flights that leave on schedule because Management doesnt

arbitrarily shut down the airline #QantasLuxury

PuppyOnTheRadio BREAKING NEWS: Qantas introduces

#QantasLuxury class. Same as standard class, but plane leaves the ground.

One message even offered some direct advice to the management at Qantas:

jeremysear Quick note to corporate Australia: when you are in the middle

of crushing your workforce, dont start a twitter promotion. #QantasLuxury

Source: How to (Really) Fail at Your Social Media Campaign, Brand Karma, November 29, 2011,accessed May 18, 2012 http://www.brand-karma.com/university/articles/case-study/how-to-really-fail-at-your-

social-media-campaign/

35

Qantas Makes Hash of Tweet Campaign, The Sydney Morning Herald, November 22, 2011, accessed May 18, 2012,http://www.smh.com.au/travel/travel-news/qantas-makes-hash-of-tweet-campaign-20111122-1nsa4.html

circos tapping into social media (a)

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