social trends report (bazaarvoice)

Social Trends Report

JUNE 2012

Social Trends Report 2012

Table of ContentsOverview .......................................................... 3

Key themes for 2012

Data-responsive brands will rapidly gain ground .................................... 4

The omnichannel appetite will separate winners from losers ........................ 6

Humanizing consumers will humanize marketing .................................... 8

Brands will become media .......................... 11

Conclusion ......................................................12

Top brands share top social trends for 2012

Like any young ecosystem, the only constant in the social landscape is change. Brands that seize on this constant change have an unprecedented opportunity to evolve their relationships with consumers. Here are four massive trends that will hasten and guide this evolution.

Data-responsive brands will rapidly gain ground. The companies that are quickest to detect and adapt to signals in social data will be leaner, more profitable, and more beloved by consumers than ever before.

The omnichannel appetite will separate winners from losers. Consumers are transcending the distinctions between channels, demanding a single, channel-agnostic experience. Brands that seamlessly deliver information, utility, and convenience to the omnichannel consumer will win their business and loyalty.

Humanizing consumers will humanize marketing. Consumers are more than the sum of their social connections and interests. The sentiment graph will reveal to companies what’s missing — what consumers truly care about, and the intensity of these feelings.

Brands will become media. Brands must become media publishers that attract — not interrupt — consumers with valuable content.

Social strategists and marketing thought leaders explored these four trends at Social Summit 2012. Read on to learn how to get ahead of what’s coming.

3


Tomorrow’s most successful brands will continuously co-innovate with customers, says WIRED magazine’s Chris Anderson.

Data-responsive brands will rapidly gain ground Social data is a brand’s most valuable ally. It reveals what consumers think, how they feel, and who they identify with — all through their own words and actions. And when companies combine social data with commerce, CRM, industry, and Web data, the resulting intelligence drives powerful change — if you know what to do with it.

The uninterrupted feedback-iteration loopChris Anderson, Editor in Chief of WIRED magazine, touts open source product development. His company 3D Robotics follows an iterative feedback loop, with consumer input driving product innovation. “You create an okay product, they buy it. They make it better, tell you how to make it better. Then you make it better, and they buy it again.”

“Every day, the 3M website functions like a focus group,” says Raj Rao, 3M Global Director for eTransformation. The global manufacturer has a history of co-innovation with consumers. Consumers participate directly in research and development at 3M’s 30 collaboration centers. Now, 3M can co-innovate with consumers virtually

“ You create an okay product, they buy it. They make it better, tell you how to make it better. Then you make it better, and they buy it again.” Chris Anderson, Editor in Chief, WIRED magazine

4


“ Interesting example from WalmartLabs www.getontheshelf.com. American Idol retail style. 4000 products submitted with chance to be carried at Walmart.” — Ryan Mathre

using social data. A new reusable tape product, for example, was inspired by online conversations that revealed this previously un-served need.

Crowdsourced product decisions also drive smarter retail. Ron Benson, Senior Director of Engineering at WalmartLabs, describes a recent promotion called “Get on the Shelf.” Walmart invited entrepreneurs to submit their product ideas online. Walmart’s customer community voted on the 4,000 ideas submitted, and the top voted products are now sold in stores and on Walmart.com. Merchandising teams were thus ensured of demand before ever stocking the products.

Consumers talk — and stay loyal — when brands act

About 30% of products at outdoor industry giant Cabela’s carry the Cabela’s name. The retailer wondered: if a Cabela’s-branded product gets negative feedback, is it a comment on the product, or on the company itself? Scott Williams, Executive Vice President and Chief Marketing and E-Commerce Officer, says the answer lies in how the company uses feedback to constantly improve — and how they communicate these improvements to customers. When consumers believe their opinions are truly heard and used to deliver always-better experiences, their dissatisfaction with a certain product needn’t cause dissatisfaction with the brand.

And this expectation of improvement keeps consumers talking. Williams reports on customer-driven improvements company-wide, from development to merchandising, vendor relations to targeted marketing.

Crowdfunding site Kickstarter lets developers sell their products while still in development — buyers purchase the idea, and the developer uses this early revenue to fund creation. The developer then invites buyers’ feedback throughout the product’s creation. Buyers influence the product’s evolution, giving them a sense of ownership in the finished version, and the product debuts with an organic support community that even established brands couldn’t buy.

Move at consumer speedKeeping up with change means keeping up with consumers. Bazaarvoice Chief Strategy Officer Mike Svatek says to catch up and keep pace with consumers, companies must:

1. Have a brand presence in every major social network.

2. Launch mobile experiences on each key platform.

3. Understand their consumers by collecting and analyzing consumer data.

5


Acting on consumers’ feedback creates deeper brand relationships than rewards or discounts, says Abbey Reider of Starwood Hotels.

This consumer-brand relationship of feedback and improvement is reward enough for most consumers, says Starwood Hotels Associate Director of Social Media and Search Marketing, Abbey Reider. Some brands encourage conversations by giving away products or discounts, but Starwood finds that the less “quid pro quo,” the relationship, the more likely it will evolve organically over time to something stronger.

The omnichannel appetite will separate winners from losers

Today’s consumers shop everywhere, and in more than one place at a time. They check specs on a smartphone from the aisle. They research products online, then kick the tires in a physical store. They surf products from the couch on a tablet, then buy online at work the next day. Consumers who research across online, offline, and mobile channels spend 18-36% more than those who don’t.

This omnichannel shopping isn’t just the future — it’s already the new norm. According to Hal Hawton, President of HomeDepot.com, half the people who visit Home Depot stores visit the brand website first. To capture omnichannel consumers, brands must deliver the right content, through the right channels, in the right places, at the right time.

Encourage repeat visits with sticky sites

The average consumer today checks 10.4 information sources before buying. What if a brand could cut this search to just a few sources by becoming a trusted and comprehensive resource? It’s impossible to anticipate every unique consumer’s research needs. Social lets brands build communities that, as consumers keep contributing, become more comprehensive and responsive with time. Consumer-written feedback, Q&A, tweets, and other social content speak to unique use cases, in the same language other consumers use in search.

And by mining this data for trends, brands can improve product copy and

6


marketing to cover what consumers really care about when researching and buying. When shoppers consistently find the information they need on a brand site, they’re more likely to return to the brand site over other sources.

Gamification — using psychological motivators common in games to encourage and reward desired behaviors — is another way to encourage repeat visits. “You set goals around actions you want consumers to take, reward them for taking those actions, and push them toward the next level,” explains Tony Ventrice, Senior Game Designer at Badgeville. Visual cues like status bars, and logical progressions like points in a loyalty program, can guide visitors toward desired actions like buying, contributing feedback, subscribing, and sharing with social networks.

A key motivator in gamification, and in building loyalty generally, is feeding consumers’ egos. “Recognition is big,” says Ventrice. Giving consumers a platform to appear expert and influence others feeds our human need for recognition, and lets us feel helpful. Andy Sernovitz, CEO of WordOfMouth.org, recalls an experience with a hotel that asked him for a review. The hotel followed

up soon after his review by thanking him, rewarding him with a badge showing how many people had read his feedback, and showing him how many people had voted the review helpful. The experience made Sernovitz feel appreciated, and more likely to book with the hotel again.

Destroy the walled garden, invite others in

No matter how comprehensive a brand site, some consumers will inevitably look elsewhere while researching and buying. “Go beyond the borders of your own brand sites to engage across your retail channel properties,” says Bob Buhowski, Digital Marketing Manager at LG Electronics USA.

Retailers and vendors can share social data for mutual benefit. While manufacturer 3M sells mainly through

“ Go beyond the borders of your own brand sites to engage across your retail channel properties.” Bob Buhowski, Digital Marketing Manager, LG Electronics USA

“ Love hearing how much The Home Depot values the relationship with manufacturing partners to get closer to the customer!” — Bob Buhowski

7


channels, thousands of conversations take place on 3M’s brand sites. 3M syndicates these conversations to retailers — over 100,000 reviews to seven retailers at last count — to ensure shoppers find the information they need in order to purchase, wherever they’re buying.

On BestBuy.com, LG syndicates review content and answers shopper questions via badged brand reps. Retailers then push this content to online properties, stores, and mobile applications. Shoppers reward brands and channels that make their decisions easy — LG’s Buhowski cites a 64% conversion rate for BestBuy.com visitors who read answers from LG reps.

Retailers can likewise share consumer conversations with manufacturers. Best Buy syndicates reviews to the LG brand site with the Best Buy logo. Visitors researching on the brand site can click through to the product page on BestBuy.com to buy.

Follow the mobile consumer or get left behind

Google defines the “Zero Moment of Truth,” or ZMOT, as the moment when someone first decides, through online research, to buy something. Consumers today needn’t even be shopping to suddenly realize a new need or discover a new product — new products find consumers online via social sharing and curation.

And with mobile, the ZMOT can now happen anywhere. 2011 marked the first year when people bought more mobile devices than PCs. Soon, four billion people will be connected via mobile — creating “hyperconnected consumers,” as Bazaarvoice’s Svatek puts it. With a phone or tablet handy, consumers can easily access everything they need to make a product decision anywhere they are, and immediately act on it. To influence these decisions, companies must make product and service information and consumer opinions convenient, digestible, and available everywhere.

This is especially true for companies like retailer JewelryTV, which have no offline presence. The phone or tablet is the second screen beyond the TV or PC that connects consumers to the brand. Brian Wilhelm, Director of Online Marketing for JewelryTV, says that 17% of the retailer’s business now comes via mobile channels.

Humanizing consumers will humanize marketing Oversaturation of impersonal, irrelevant marketing has made consumers distrusting of and disengaged with traditional advertising. To capture their attention and interest, marketers must finally understand what individual consumers truly care about, and market to them accordingly.

8


Deliver highly relevant advertising by combing sentiment, social, and interest graphs, says Bazaarvoice’s Matt Marx.

The sentiment graph lets brands know consumers as individuals

The social graph defines a consumer by his or her connections to others on social networks, while the interest graph approximates his or her interests based on an analysis of data like the content of their social updates and profiles, clicks, pages visited, and time on site. While both are useful, neither provides a completely accurate portrait of who a consumer is, what they look for in brands, or how they feel.

Enter the sentiment graph, which uses all of a consumer’s comments, ratings, opinions, and conversations shared online to discern how they feel and what they care about — which speaks more directly to who they are, says Matt Marx, Bazaarvoice Product Director. “Knowing how you feel is core to knowing you,” Marx explains. “It’s the difference between knowing that you’re generally interested in cars, and knowing that you’re passionate about powerful engines.” Suddenly, it’s possible to really know a consumer, and speak to their individual needs.

“ Knowing how you feel is core to knowing you. It’s the difference between knowing that you’re generally interested in cars, and knowing that you’re passionate about powerful engines.” Matt Marx, Product Director, Bazaarvoice

9


Social, interest, and sentiment graphs combine for crystal- clear context

Based on a consumer’s social connections, interests, and sentiment, brands can deliver hyper-targeted, highly relevant advertising. Consider a consumer who frequents travel sites (interests), who has articulated a strong preference for long battery life in his online technology reviews (sentiment), and whose nephew recently posted about his new Android tablet on Facebook (social). Combining these three graphs, an advertiser can target the consumer individually with ads for an Android tablet touting battery life, and an aggregate rating of 4.7 stars from reviewers who identified themselves as frequent travelers.

The unprecedented consumer understanding possible through these graphs can also power highly-relevant curated shopping. When a visitor reaches a retailer’s site, for example, the site can dynamically display products based on the visitor’s likes, dislikes, and interests.

Authenticity above all

Relevant opinions delivered based on the sentiment graph lose all value when consumers question their authenticity. Over half of Millennials (consumers

aged 18 to 34) trust the opinions of strangers online over those of friends and family. Consumers don’t always agree with the people they know — online, they can instead find information from experts or people more like them. When brands serve these opinions, they must be authentic — or risk irreparably losing consumers’ trust.

As Suzanne Fanning, President of the Word of Mouth Marketing Association (WOMMA), puts it, “Word of mouth cannot be faked. Well, it can, but you will be caught, and it will not look good for you or your company.” Fanning says brands must embrace the idea that happy, interested people will say good things about companies and their products — and these genuine sentiments are the basis for loyal consumer-brand relationships.

“ The ultimate marketing tool comes 2 life when u combine social + interest + sentiment.” — Nicole Bernstein

“ Word of mouth cannot be faked” Suzanne Fanning, President, WOMMA

10


Brands will become mediaBrands no longer have a captive audience in traditional media channels. Companies today can’t just broadcast any message and expect everyone to listen. Meanwhile, social allows anyone to create, publish, and share media. In this democratized audience, the content readers deem most valuable rises above the noise.

Serve the audience to command attention

“I’ll be interested if you’ll be interesting,” says WIRED’s Anderson. Brands must become media companies, capturing attention by being helpful, interesting, or entertaining. Anderson says that brands need to start acting more like magazines, and create compelling content that people want to interact with and share. Stop marketing. Stop selling. Start educating, entertaining, and informing in ways that captivate the people you want to reach.At Kate Spade New York, “We really see ourselves as a media company,” agrees Johanna Murphy, VP eCommerce. The brand engages fashion-conscious women with style tips and media about real life. It ran a Twitter series, written by real young women taking a road trip to the Coachella music festival. The ladies tweeted pictures and recaps of their encounters and, of course, the Kate Spade products they brought along. “They’re talking about packing — what

Kate products they’re taking, but also other things that are not product-focused.”

Knowing how to say it is just as important as knowing what to say, says WIRED’s Anderson. He urges brands to craft a distinct, memorable voice like no other, and be consistent across every media channel, from print to broadcast to online. He cites Martha Stewart as one of the most successful brand media voices ever. The Martha Stewart brand literally assumes a persona authentic to its namesake founder. Groupon, as another example, has a voice that’s cheeky, funny, and lighthearted. It turns simple coupons into opportunities to entertain and delight with story, setting the brand apart.

Participate, don’t dominate

“A brand is the sum of all conversations happening around the brand,” says Kyle Lacy, Principal of Marketing Researching & Education for ExactTarget. The way to get people talking is the same way to get their attention: by creating content they enjoy and see value in,

“ I’ll be interested if you’ll be interesting.” Chris Anderson, Editor in Chief, WIRED magazine

11


and communicating it in a voice they recognize and are drawn to in any context.

Kate Spade sparks conversations on brand-relevant aspects of everyday life. The brand also encourages its fans to create and share content — the Kate Spade Facebook page hosts consumers’ product feedback, and the branded Pinterest account shares pins from users of Kate Spade products alongside other fashion and images that inspire them.

The shift from passive viewers to engaged, active consumers means branded content has to be something people want to engage with — not just listen to or watch. And though it may sound counterintuitive, a great way to get people talking about a brand is to not talk about the brand — or at least, not just about the brand. Companies that provide interesting things for

people to talk about with each other attract more attention and ultimately build more loyalty than companies that only talk about themselves.

Swim with the current or be swept awayThese trends create a marketplace where real consumer-brand relationships are more important than ever. A world where symbiotic partnerships between the people who buy products and services, and the people who sell them, aren’t a pipe dream — they’re a business reality. Bazaarvoice helps companies better understand consumers, so they can serve them better. Find out more at www.bazaarvoice.com


www.bazaarvoice.com

This document is provided “as-is”. Information and views expressed in this document, including URL and other Internet Web site or company name references, may change without notice. Some examples depicted herein are provided for illustration only and are not guarantees of a specific result. You bear the risk of using this document.

This document does not provide you with any legal rights to any intellectual property in any Bazaarvoice service or product. You may copy and use this document for your internal, reference purposes only.

© 2012 Bazaarvoice, Inc. All rights reserved. Bazaarvoice and any Bazaarvoice service or product name or logo used herein are trademarks of Bazaarvoice, Inc. All other company or product names may be trademarks of the respective companies with which they are associated.

social trends report (bazaarvoice)

Business

social trends

humanizing consumers

successful brands

brands actabout

social connections

social strategists

social landscape

social summit