the power of social media by: pete marcus 5/13/13 bus 550
TRANSCRIPT
The Power of Social MediaBy: Pete Marcus
5/13/13
Bus 550
3 Business Cases
3 cases from the Stanford graduate school of business:
Amplifying Perceptions: How JetBlue uses Twitter to Drive Engagement Satisfaction
Deals @Delloutlet: How Dell Clears Inventory Through Twitter
Bonobos: Customer Intimacy Through Community Development
Jet Blue- When and Why
Jet blue joined twitter in 2007- to target its loyal frequent flyers
Build Brand thru engagement
They tweet honest and transparent info to connect with potential customers
Twitter vs. Facebook
Started twitter because more mobile
Users were more prone to talk about the product while using the product
Twitter allows you to jump into conversations
“Twitter gives this audience a chance to experience us before they’re even on one of our planes. For both the loyal customers and the potential customers, Twitter was a medium for engagement and making the brand familiar“.
Jet Blue Cheeps
Launched "All you can Jet" Buffet -Sept 8-Oct 8, 2009
$599, fly as much as you want
Cost to advertise this promotion- essentially free
Sold out in 48 hours
Q3 Profit 2009- 15 million profit
Q3 Profit 23008- 4 million loss
Preemptive Customer service
10 employee twitter team could instantly address and resolve issues
Can literally engage with them while they are sitting at the gate
Example-bike handling fee
Many people didn’t like the fee or how it was handled
Within 24 hours- Problem fixed!
Twitter Changed the Company
Twitter has changed corporate communication
Normal corporate responses take days if not weeks
More casual and immediate interaction
Both profits and customer service increased
Dell Clears Inventory through Twitter
June of 2007 Dell launched the Twitter handle: @Dell Outlet
Needed to sell returns (no longer can label new)
Bubble inventory- don’t know what they will have
Look BIG, Act small
Twitter allows a giant corporation like Dell to connect to customers like a mom and pop store would
Realized potential to help customer service, opened over 80 Dell accounts to help with support
@stefanieatdell, @lionelatdell, etc.
Power in Numbers
April 2009- 25,000 Followers
Over 1.57 million by April 2010
Dell interacted with over 3.5 million people through not only Twitter but also Facebook, Direct2Dell and IdeaStorm
Twitter Impact$ Dell
Since launching @Delloutlet, Dell has earned $3 million in the U.S. market
Globally, Dell earned $6.5 million
Average earnings- $3,000 per tweet
Pants- 1 leg at a time
Bonobos Founders: Brian Spaly and Andy Dunn
Classmates at Stanford Graduate School of Business
Launched Bonobos following graduation in 2007
Goal: Fix men’s pants crisis
More Please
Customers were so happy with the pants that they wanted Bonobos to expand their product line
However, Dunn worried that it may hurt what they already have and dilute pants brand
Decided to expand and they needed an outlet to spread the word that Bonobos was not just about pants, and would offer more quality products for men
Which Extreme are you?
Ralph Lauren Sold what they thought
customers wanted
Threadless Consumers could vote on
designs, and they would sell most popular
BIG Hole in the middle of the two
Develop the Middle
Bonobos developed a community driven platform that would focus on: social media, commentary and purchase behavior
Merchandising team would choose which products they feel consumers want, and then the community would decide from those products
Leverage community and tech to promote and sell
40% Word of mouth
30% promotions
30% though Facebook and other internet marketing
Time to Deliver More
Through the Internet, Bonobos would run 3 campaigns
1- Boat Shoes- target people who like boating and sailing
$1000 to run, drove 2,000 people to their site
2- Collar Stays- target men in twenties
One type could open a bottle or be a screwdriver
Drove 300 people a day, conversion rate was low
3- Bags- target investment bankers
Only 50 people came to the site when they had 135,000 impressions
Ninja Program
Ninjas would exceeded customers’ expectations in every interaction
Good employees bored
Bad Employees overwhelmed
Compensated Ninjas at higher levels than retail sales
Up to $60,000 starting salary plus equity ownership
Would interact personally with thousands of Bonobos customers via: e-mail, “in-person” fittings, Twitter, and by managing the Facebook campaign
Corporate Communication
Bonobos saw social media as the main communication for the company.
Managing Engagement They used Facebook to interact with customer: Should we enter Children's market?
Started Question of the day on Twitter- any question
Also offered coupon for next purchase if they gave feedback on this purchase
Conversational Commerce Goal is for the customer to drive the brand, and not try to expand vertically
Want to "own" the customer
In the End
All 3 companies joined Social Media
All 3 companies realized the value of interacting with the customer
All 3 companies improved customer service
All 3 companies generated more profit because of Social Media
Jet Blue Question
Why Did Jet Blue drink the Twitter Kool-Aid?
A- More mobile than Facebook
B- Users more likely to engage when using product
C- Can jump into conversations
D- All of the above
ANSWER- D
Dell Question
Why did Dell have a need to join Twitter?
A- Because they loved the Hashtag symbol
B- They wanted to become strictly an on-line business
C- They suffered from Bubble Inventory
D- All of the above
ANSWER: C
Bonobos Question
Bonobos focused on what type of platform?
A- Computing Platform
B- Community Driven Platform
C- Diving Platform
D- Vertical Platform
ANSWER: B