Most of the online hype about organizational social media adoption revolves around the “social business” craze. In my conversations, most businesses say they’re grappling with the multichannel integration into marketing. It begs the question, “What will come first, the full integration of social media into the marketing wheelhouse or the widespread rise of socially-enabled enterprises?”
I was talking with Gini Dietrich about our forthcoming book Marketing in the Round, and which topics people would find interesting. We discussed measurement, and both of us noted that whenever we get into the nitty gritty of ROI and outcomes blog traffic drops precipitously.
The sales pitch for social business (see IBM’s definition) has spread from the technology industry to the social media echo chamber. Social media tools will bring a promised evolution of business, but how much of this buzz is bullshit?
At the same time when you start seeing social media experts across the blogosphere setting up social business shingles, you have to wonder. Am I being sold the real deal or just another dose of unicorn powered super conversation?
In that vein, I’d like to invite you to sound off. Is social business a great thing, or yet another overhyped promise from social media experts looking to break into the enterprise? The best five comments pro or con (as judged by me on Friday afternoon) will win a copy of Jason’s book, No Bullshit Social Media.
To get you started, I’ve listed three reasons for and against social business. Good luck!
1) Perhaps the best argument for social business is speed. Watching Dell’s team respond to situations by integrating communications, legal and more was impressive. By empowering and encouraging interactions through process and social technology, businesses can better respond to customers and situations. Speed is a competitive advantage in any market.
2) One of the best comments from the Customer Is Not Your CMO came from Ben Kunz, who noted there are three ways to become a great business. One of them is to become completely customer centric. Social business empowers widespread dialogue across enterprises all the way to customers and other stakeholders. This in turn creates the opportunity to become completely customer centric, from sales to operations.
3) While companies like Walmart are leading the innovation wave amongst traditional consumer enterprises, technology players like Salesforce.com, IBM, Atos and more are acquiring social technology companies, changing their cultures, and moving towards the social business ideal. The technology industry is eating its own dog food and leading by example, just as it did with blogs and other initial social media a decade ago. History is repeating itself.
1) Social media experts are beating this drum loudest, and that triggers a big red flag. Many social media experts don’t know marketing basics, and in some cases refuse (or can’t) to deliver return on investment. Now they are suddenly telling the business world how everything must change. So, someone who knows how to game Twitter suddenly understands how to run a multimillion dollar enterprises? Social business sounds like the pedantic ramblings of middle managers ad consultants trying to justify a bigger piece of the pie.
2) Businesses still struggle to integrate social media into marketing, yet, in large part because they don’t see the value. According to a survey of the CMO Council, 66 percent of marketing organizations are not integrating social media into their full marketing outreach.
Social media’s best chance of becoming a part of the regular business mix is through the auspices of the marketing department. But don’t expect it to change everything and transition the CMO’s office into social marketing. Social will only play its role within the larger multichannel experience.
3) The word social doesn’t mean anything anymore. It’s gone the way of other cliched technology and media terms, like “2.0” and “.com”. So what are we really talking about here? Widespread social media throughout an organization revolutionizing business structures?
Isn’t this the revolution of email and intranets argument again? Sorry, but while those technologies facilitated better communications and workflow, and evolved businesses, silos stayed silos. Why will commenting faster and quicker change power dynamics between departments and people? Will social technology fundamentally change people? It hasn’t so far. This argument lacks substance.
Marketing extends beyond stakeholders and organizations. Although companies and nonprofits like to pretend they operate alone in an industry, competition exists even if its just for the stakeholder’s time and money. If a marketer does their job well, and the product, service or solution is met with a warm reception, invariably the competition responds.
Moving forward, there are some common competitive responses that you can expect. Here are five of them:
1) Pretend You Don’t Exist
This out of all the responses is the most short sighted and foolish response. The ostrich approach — at least publicly (they certainly talk about you behind closed doors) — kids no one. Customers know there are alternatives, and so does the media and bloggers.
No one thinks the company or nonprofit operates in a vacuum, so when your competitor acts like that, it causes them look, like, well, marketers. It doesn’t mean anything other than people view communications from their organization to be completely transactional or brand related. Customers are less willing to trust them.
Further, it’s hard to develop industry leadership when a company doesn’t acknowledge the ecosystem, even in a general way. Apple rarely talks about HP or Dell, but it certainly acknowledges and talks about other PCs and smartphones. Car companies discuss industry accolades, which is smart, because it puts their product within a competitive context.
2) Copy Your Offering
When a company does really well, a common competitive response is to ape the product and offer the same product or service, often with less success. After Amazon launched the Kindle, Barnes & Noble offered the Nook. When Cirque du Soleil revolutionized big top entertainment, other circuses stole elements from their shows like the ribbon dance.
Holding first place is a very strong position for long-term success. In a strategic sense, first is the position of high ground. It’s always good to have established market share when this happens, but it can still be quite disconcerting.
There are instances when a company like Netflix or Google rises up and wrestles the market away, usually through some sort of technological innovation. Sometimes companies are caught in a price war.
The key here is to not necessarily over-react to the competition. Rather, to continue innovating on the product or service offering and extend market leadership. Don’t rest on your laurels.
Google recently purchased Motorola Mobility to acquire its patents in an effort to strengthen its case against Apple, who is suing the search giant for copying the iPhone iOS with Android. Other common hardball acts include talking poorly about the competition publicly, privately, stealing (er, hiring away) their talent, blocking distribution, and undercutting pricing to seize market share.
These are the tactics of war in the market. You have to be able to defend against them, not necessarily with direct engagement, but certainly by responding with value to your customers.
While these tactics are inevitable, they almost always make the market harder to work within, and can reduce customer trust sector-wide. These tactics do not grow the general market in any obvious way.
4) Go Toe to Toe
In an established market like car insurance where offerings are very similar from company to company, it is not uncommon to see advertising that directly positions a company against its competitors. This is a common tactic that Sprint takes with Verizon and AT&T with its data and service plans.
There’s not much you can do here other than to clearly state why your product is better than their’s and to engage in customer service and loyalty programs. This is about avoiding customer churn by bettering your total experience.
In the competitive wireless market, Sprint is a distant third currently, a gap that has increased over the past decade in large part because of the customer service issues the company experienced after acquiring Nextel. Having resolved many of these issues, it is now struggling to rebuild that marketshare. In a highly commoditized market, non product specific points like service can make a great difference.
Last, but not least is when a competitor responds by offering a product or service that is significantly higher quality, more cost effective or easier to use than yours. While you might have the higher ground, this type of innovation in a new offering creates green fields for your competitors. Customers flock to them.
Consider how Japanese companies beat their U.S. counterparts in the electronics and the automotive sector in the 70s and 80s by offering higher quality products for lower costs. The result was incredible losses of marketshare and reputation. Google beat Yahoo by offering a superior search algorithm.
In this instance, speed is critical. Loyal customers will stick with your brand, but only if you are able to match or better the offering quickly. Unfortunately, when faced with a paradigm shift, most leading companies fail to respond, comfortable in their way of doing business. And thus new brands seize market leadership.
What are some common responses you see from competitors?
We met with several critical players on the Dell team, from perennial leader Lionel Menchaca to Amy Heiss, program manager for the Command Center. Along the way we learned quite a bit about how Dell evolves with its clients needs, in the United States and globally.
Perhaps the biggest impression made on me was the experimental and open nature of the Dell social team. When I walked into the cavernous room that houses Dell’s social media group, I noted several things:
A wide open space with no cubes or barriers
The team sitting together is cross disciplinary, ranging from communications and social media to customer service and legal. They literally have no excuse for silos as they all sit within strides of each other.
The Command Center (featured above) is the room immediately next to the open office space, readily accessible by all
An ambiance that’s generally light, fun and curious
Dell has become a “socialprise”, and is actively experimenting with the best ways to enable fluid business dialogue in the enterprise, critical to its online success. The company clearly understands that empowering departments to interact quickly extends beyond process. The result is increased access through physical space and location.
Data, Training and Falls
Dell is listening to its current and potential customers in a very organized fashion across a wide range of data points. For example, the above video details influence tracking, just some of the incredible data the Command Center tracks. The diverse data points range from products to conversations to global regions to all the industry players involved.
In conversation with Rajiv Narang, executive director for social media and marketing innovation at Dell, it became clear how analytical this company is. We’re talking the ultimate data geeks here. Dell sees data, conversations, trends and corresponding behaviors, and deeply analyzes to distill knowledge. Then it mindfully addresses its business direction to serve the market. It’s fantastic.
Another factor that became clear was how incredibly social the company has become. In meeting with many diverse players in Dell, from enterprise sales to sustainability and social good, almost everyone of them had been certified in the company’s social media program. Knowledge and practice ranged, but it was clear that the 5000+ employees who have been trained are interested, and see social as a critical component to the company’s success.
It was great to do this trip with Jason Falls, too, who will add his insights next week. Jason is clearly doing really well, and is at the top of his game with the release of No Bullshit Social Media. Congratulations, Jason. You deserve all of the success as one of the hardest working people in the sector.