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The Conversation - July Edition

Jul

Welcome to The Conversation. In this issue, as well as highlighting company and client news, we will be exploring the impact that social media has had on the business world today.

In order to broaden out this vast topic, Sermelo asked three friends for their answers to the following questions:

  • What has been the impact of social media on your industry?
  • How do you think social media will change business in the future?
  • Should social media and appropriate metrics be a topic discussed regularly at executive committee level?

Our thanks go to Robin Hamman, Dachis Group General Manager for Europe; Hugh Davies, Director of Corporate Affairs for Three and Mic Wright, Chief Technology blogger at The Telegraph and freelance technology journalist, for sharing their thoughts in The Forum.

A Word from our Founder - Jonathan Jordan

Looking at the impact of the digital economy on business

The disruption caused by the digital economy has already had a massive effect on virtually every type of business and there have certainly been winners and losers. The likes of ARM and Google are seeing their value rocket as they enable the mobile economy, while companies such as Hibu, the phone books giant once known as Yell and worth over £5bn, is now valued at just £6.7m and has folded under its mountain of debt.

Some may argue this is nothing new, however, I think you ignore the risk and opportunities of the digital economy at your peril. For the most part, society has embraced the digital dynamic and we have to wonder what’s causing ‘corporate inertia’?

While it’s easy to reference factors such as the weak economy, shifting demographics and globalisation, I think the fundamental issue is linked to corporate culture. We like to analyse and add a logical, rational framework to the changes we see occurring around us. We like to understand and explain how different segments of audiences will respond to our value propositions. While this is all good, it does tend to forget one fundamental thing: control is changing. Above all else, the digital economy has improved everyone’s ability to communicate, and we expect businesses to engage with us, and not run and hide.

Whether we are an employee, a customer, a partner, a shareholder or an interested bystander, we want to know more. We now have free tools to educate ourselves quickly on any given subject. This process is increasingly difficult to control, and frankly it should not be attempted. Instead, businesses need to come to terms with new information hierarchies and managing various ‘permissions’.

To prosper and succeed, we must recognise that the shift from control to collaboration presents an existing new proposition, and ensure our corporate culture can embrace it.

Out and About

Event analysis on The London Social Business Summit 2013

At a time when everyone is talking about ‘big data’, the Dachis Groups’ London Social Business Summit 2013, did well to draw on existing data driven marketing and business strategy, whilst acknowledging that the convergence between social software and data analytics has only just begun. That we “should think of data not as the new oil but instead, a new solar power”, as John Hagel expressed – one that is renewable and grows as it is used over time – certainly brought home the enormity of where data analytics in social business is going.

The key takeaway from this event, however, was not the importance of ‘big data’, but instead that social media allows businesses and brands to come back to their core ambassadors and engage, once again, with their communities. A couple of speakers in particular, really drew out this point:

  • Tom Ollerton from We are Social drew attention to how social media is changing the retail market. Now, success is being measured not just in terms of making a sale, but whether it constitutes a ‘social sale’– when a consumer buying a product feels an incentive, or is incentivised, to share it via social media. Done to either gain favour with the brand (and gain promotional access or discounts) or because it fits into a certain ‘story’ for that consumer, the action opens up a new relationship beyond the traditional sale. This allows for direct brand interaction and engagement, not just with the consumer that purchased the product, but with everyone in their network.
  • Davide Casali reiterated this, explaining that an effective brand is one that brings together a community of people - a tribe. For a brand to become truly successful it has to build itself up with the right incentives, creating a tribe and trust relationship that can scale. For this to be done well, a company needs to look to its first wave of advocates, its employees. Every brand must think first and foremost about embracing and empowering workers as a core part of social strategy.
  • Robin Hamman made a great case for allowing employees to embrace Facebook and social media in the workplace. Data tells us that the public are more likely to trust the staff of a company than the CEO, and that content pushed out by employees gets up to 100% more interaction than pure brand marketing alone. If the average person has 141 Facebook friends, then for a business to engage with every employee and encourage them to be brand ambassadors on social networks, is far more likely way to reach and engage with a relevant community.

Sermelo Insight

Social media – still only one tool in the reputation management box

Monitoring and protecting reputation has always been hard and social media hasn’t made the task any easier. Fortunately, there are now (finally) systems on the market which do a good job of aggregating all the important information, showing you where to find it and telling you why it’s important. On top of this, these products also allow organisations to track the success of their proactive efforts.

One particularly important tool is the ability to evaluate uptake and dissemination of key messages across social media; allowing an organisation to adapt and modify its approach to maximise resonance with its campaign or brand. Systems that stand out in this space include Radian6 and Crimson Hexagon. Of course there is a lot of development work still going - led by companies such as Blue State Digital. Particularly impressive and exciting in this space is the emerging ability to identify key online social media stakeholders, engage with them directly and then through their participation create and develop campaigns where ownership is shared between organisation and online individual, yet guided and controlled by the former.

This will transform campaigning, promotion and advocacy as it allows organisations to humanise and then publicise their messages through the independent and, crucially, trusted voices of potentially millions of grass-root activists. In a world where news and information has shifted ever further towards opinion and polemic, individuals seek out people they trust; the result being that your organisation’s best advocate is someone down the street that your target customer knows.

This sounds great but could prove a nightmare. How, for example, are other organisations, especially competitors, going to track and monitor this? How can you identify an advocate of an issue as natural or cultivated and how do you then move to mitigate any adverse impact? How will this affect your organisation’s reputation and how can you move to manage it? On top of this there will remain the traditional stakeholders such as regulators and NGOs who need to be covered if there is to be an effective, 360° approach.

All this reinforces the fact that effective reputation management is complex and multifaceted. Social media and the monitoring of it are core components of the discipline, but they are only part of the process. Tools tracking twitter, Facebook and LinkedIn cannot, for example, always tell us what the thought processes and statements of, say, a government department are, nor are there systems which can effectively automatically prioritise stakeholders without the good, old-fashioned tools of human identification and judgement. The list of limitations continues: How can systems get round pay walls to publications which are vital? Where is the crucial pre-emptive risk assessment? Where is the analysis of impact?

As we can see, there is no single silver bullet for an organisation to monitor and manage its reputation. Instead, to do it properly, a variety of different tools are required to be intelligently tailored to its specific needs. The information gained from this then needs to be judged and then managed to produce a qualified, proportionate and effective action plan. There is no automated system on the market which can achieve this, or that provides all the information necessary for an effective judgement in a one-stop-shop.

Human experience, expertise and selection is required. Although it is now easier than ever to believe that your organisation’s reputation is protected because you spend thousands a month and get a shiny dashboard with lots of applications and colours, the reality is that these tools form only a part of a complicated process which needs to cover as many channels as possible. Reputation has become a key battleground for organisations and it is crucial for them to manage all aspects of it comprehensively, effectively and proactively. Don’t let yours be lulled into a false sense of security by addressing just part of it.

For more information on related topics, please feel free to read the following:

The Forum

We spoke exclusively to a panel of experts to find out how social media was affecting their businesses.

Robin Hamman, General Manager for Dachis Group Europe

What has been the impact of social media on your industry?

We provide social business consultancy services and software to help organisations enable closer collaboration throughout their workforce. There's a lot of interest, across every business sector, in this kind of work. Some of the strategic objectives we've helped clients target include increasing collaboration across the workforce, increasing the reach of consumer campaigns and deepening audience engagement with them.

How do you think social media will change business in the future?

Many businesses that have ventured into social media have failed to be strategic about it - they're "on Facebook" because they suspect it's important. I think the C suite is starting to ask tough questions about the ROI of social. I believe that social media can help businesses to meet their objectives - whether that's targeting scarce resource on high value recruitment prospects, or building reputational awareness and driving brand advocacy - but it will only do so if the objectives for social media are strategically aligned from the outset.

Should social media and appropriate metrics be a topic discussed regularly at executive committee level?

If social media is being used to target specific strategic objectives, than its contribution towards meeting those objectives is, by definition, measurable. If a brand is simply collecting fans and followers, with no particular outcome in mind other than steady growth in those numbers, then the measurement is meaningless. Executives can and should review the metrics, but first they need to start demanding that those metrics are themselves meaningful.

Hugh Davies, Director of Corporate Affairs for Three

What has been the impact of social media on your industry?

Land grabs, confusion, integration challenges, customer advocacy and frustrations vented in your face, reaction and distraction.

How do you think social media will change business in the future?

It did. We’re catching up. Will we get ahead … in some ways, but it’s social.

Should social media be a topic discussed regularly at executive committee level?

It is and it should be … but as part of the overall feedback on brand and business performance … in the end it is just another channel for customer interaction / feedback / anger etc, but it is evolving rapidly so board should be aware of the comment, the scale and the changing impact on licence to operate.

Mic Wright, Chief Technology Blogger at the Telegraph

What has been the impact of social media on your industry?

Social media has lowered the barrier to entry in journalism – anyone with a great idea can potentially access a huge audience. It's also done terrifying things to the industry. So many stories now are written purely to incite a reaction from social media or are stolen from it. The big benefit for individual journalists is that things like Twitter and Facebook allow them to build their own platforms beyond traditional media companies.

How do you think social media will change business in the future?

It has changed business a great deal already. Understanding how best to interact with customers, potential customers and the wider public through social media is something all businesses have to get their heads round now. It's also important though to remember how many of your customers aren't on social media and apply the same care and attention you'd put into all your interactions. If my grandmother has a terrible time dealing with someone on the phone, the fact that your Twitter account is super-responsive is by-the-by.

Should social media be a topic discussed regularly at executive committee level?

Yes. If you're not presenting a public face for your company on social networks, someone is still having that conversation about you. Don't put your social media strategy in the hands of an intern and hope for the best. That way lies disaster.

Category

Digital

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