The Social Media Path to Customer Engagement

Paul GillinAuthor, The New Influencers

Cancelling AOL

AOL HellJune 20

June 24

June 26

June 21

June 23

July 14

Today

Vincent Ferrari

Meet the new influencers

Steve Hall

Philipp Lenssen

Paige Heninger &Gretchen Vogelzang

New Influencers are passionate – both pro and con

Brand Engagement

Des

ire

to In

flu

ence

Oth

ers

Reject

Pa

ss

ive

Favor

Ac

tiv

eHaters

EnthusiastsCritics

Lovers

Dismissers

MainstreamSkeptics

Followers

Traditional influencersAuthoritative 3rd parties, community leaders, press, gov’t.

New Influencers

Source: Sean Moffitt, BuzzCanuck

Dell Hell

“Dell said that it found no pattern of battery failure and that the Pennsylvania incident publicized by the Inquirer Web site was caused by a chip problem and not batteries.”

NY TimesJuly 10

June 24

More Dell Hell

“Please remove the posting located at the following link: http://consumerist.com/consumer/insiders/22-...It contains information that is confidential and proprietary to Dell.”

June 14, 2007

Dell's 23 Confessions Now's not the time to mince words, so let me just say it... we blew it…. instead of trying to control information that was made public, we should have simply corrected anything that was inaccurate. We didn't do that, and now we're paying for it.

June 16, 2007

But today Dell is a convert

"These conversations are going to occur whether you like it or not…You can learn from that. You can improve your reaction time. And you can be a better company by listening and being involved in that conversation."

Michael Dell, 10/17/2007

Consumers in control

Whom do consumers trust?

30%

37%

49%

50%

60%

63%

69%

75%

83%

Blogger review

Chat/discussion comments

Editor reviews at opinion site

Online consumer sites

Reviews on company site

Expert review

Company website

Media review

Opinion of a friend

Percent who trust each souce

Source: Forrester Research, Jan., 2007

Seeds of change Web 2.0 is the greatest experiment in group

self-organization in history Sophisticated patterns of influence

emerging Personal publishing will completely disrupt

the mainstream media; many won’t make it Everyone is now a potential content

producer; this will fundamentally change the way businesses market and sell

Why now?

Cheap technology Fast networks Google “The Long Tail”

Source: Pew Research

It’s now cheaper to keep information than it is to throw it away. It’s also easier to publish information than ever before. This is an explosive new combination.

Let’s get small

Engaged customer Technology enabled Well-informed Opinionated Focused Passionate

Mainstream media economics

Rooted in mass markets Delivery network is

differentiator High reader/viewer

retention rates; lack of customer choice

Fat margins, high fixed cost

High barrier to entry

Social media economics

Rooted in small markets Delivery is cheap and

outsourced Limitless choice;

retention driven by content

Fat margins, low fixed cost

No barrier to entry

Media revolution

Intentions ≠ Reality…yetWord-of-mouth marketing is expected to surpass $1 billion in 2007, making it one of the fastest-growing alternative media formats. In a new research report, PQ Media also predicts that spending on word-of-mouth marketing will grow at an annual rate of 30.4%, and will hit $3.7 billion by 2011.

MediaPost, 11/6/2007

•58% of marketers have implemented user-generated content or reviews.

•31% have implemented a blog.

•25% have implemented RSS feeds.

Coremetrics, Nov. 2007

81% of all respondents project that by 2012 they will spend at least as much on conversational marketing as traditional marketing.

Society for New Communications Research, Oct., 2007

Tap in

Action: Listen to the conversation

Tools: Google, Technorati, Bloglines, Facebook

Objective: Find out what’s being said; learn the language and the culture

Result: Understand

Online tools

Engage

Action: Talk to the influencersTools: Comments, groups, blogs, “friends”

Objective: Identify brand advocates; contain and educate critics

Result: Influence the conversation

Leverage existing communities

Sends high-end cell phones to bloggers

No strings attached

All reviews indexed on Nokia site

Sixth campaign using this approach

Nokia

Recruit

Action: Turn enthusiasts into promoters

Tools: Widgets, tchotchkes, access, retreats

Objective: Build low-cost virtual sales force of informed customers

Result: Brand visibility; sales leads

In summary… Social media is a great market research

tool, even if you use it for nothing else Messaging will be increasingly irrelevant Markets will become more segmented Leaders are emerging but leadership is

tenuous Content and credibility are king

Thank you!

Paul Gillin

508-202-9807

paul@gillin.com

www.gillin.com

Now availablefrom Quill Driver Books

Read more and order at www.NewInfluencers.com