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Social Media for Business – the creditcrunch avoidance mechanism for a CMO? (Extract from Media Week Interview)
Socialmedia seems to be the new buzz word dripping off of the tongues of marketingagencies, branding companies and of course online media agencies, but do theyreally understand what social media is, why it’s arrived on our doorstep with afanfare of promises? Just why are social media companies such as MZINGA in theUSA and H2O New Media in the Middle East attracting such high numbers ofcustomers whilst at the same time receiving obscene valuations reminiscent ofthe dot com era when everything else seems to be going downhill in the GlobalCredit Crunch faster than a bankers paycheck.
“There
are three key facts that anyone in a companies marketing department needs to
understand about Social Media prior to adopting its use. Firstly it’s important to understand exactly
what social media is and the culture that supports its adoption. The internet historically was a counter
culture medium, extolling the virtues of freedom of expression and media
liberalisation. It used to be that media
content was spoon fed to the masses through mass media channels that were
heavily controlled by regulators; you were told what to watch and when to watch
it. 
That’s changed forever. With the availability of easy to deploy web
tools, social media applications and search engines its now possible for
anyone, anywhere to create their own media channel and that media channel can
encompass all of the old broadcasting stalwarts including Radio (Podcasts)
Television (Online Video) and Print Journalism (Blogs) quite simply anyone can
now be a media channel for their own specific audience, their friends or even a
niche vertical. More importantly it can’t be controlled, with tools such as
RSS, Email Distribution and Free VPN software you just can’t block content, if
people want it they will get it.Thesecond key fact is fragmentation, Social Media as a media platform is goingthrough the same fragmentation that Television, Radio and Print media hasdone. For anyone old enough to rememberwhen there were less than five television or radio channels available, or whenmagazines were limited to just one shelf of your local store only to now havethe choice of hundreds of thousands of specialised and focused TV and Radiochannels depending on your interest. Magazines similarly now cater for every demographic, interest and quirkand you will find that social media is destined go the same way. Social Media will fragment into millions ofspecialised media channels along the same lines, interest, location anddemographic – I will personally guarantee that”
Thethird piece of the Social Media Puzzle according to Vaile is the exact reasonwhy social media is bucking the trend. “The reality about social media is that its highly effective as you cantarget the specific groups that you want to communicate with incredibleaccuracy, its incredibly low cost when compared to traditional media platforms thatcarry huge production overhead and its highly measurable. By understanding exactly how your marketingbuck has delivered value into your business by getting granular about thereturn on investment CMO’s can justify their existence to CEO’s that are underincredible cost reduction pressures. Easily definable, measurable and most importantly positive results meana happy CEO and an employed marketing professional.
Sowhat exactly is social media and how to you get your hands on it quickly andstart making it work for you. SocialMedia is a mix of mediums; video channels such as You Tube, Blinx, Clipo.TV andMetaCafe serve up a melange of video content based on your personalpreferences. It is now fact that moreteens watch online video than television. With the right marketing campaign, creativity and buzz behind a good YouTube Video you can cover over 3 million people effectively for just a fractionof the cost compared to a Television Commercial (TVC) in a much tighter targetaudience
Similarlythe ability to engage with over 200 million bloggers on a one to one basis toget them talking about your brand is an opportunity not to be sniffed at. Podcast communication, advertisement seedingin popular podcasts that appeal directly to your target market is a much moreeffective than a blanket radio ad when you need to generate revenue with asmall budget.
It’sa reality that when the chips are down and there is very little money availableand that general branding tends to get sacrificed for marketing campaigns thatgenerate short term and tangible revenue results to the business, but whatabout reducing the companies costs? Surelyit’s the CMO’s job to spend money to make money? Well according to Vaile those days are alsowell and truly over.
“Thesedays it’s just not good enough, with the right application of social media inthe business a savvy CMO can do a lot more with a lot less. It’s possible to automate targeted marketingwith vertically focused communities that message a subscriber on sign up formuch less than the cost of one employee. With the implementation of collaboration tools to generate meaningfuldialogue with customers social media when deployed in the enterprise can reducetraining costs, marketing costs, support costs, administration overhead and ITcosts, companies that automate and integrate in times of gloom are generallythe winners. The fact that we help abusiness achieve automation that delivers cost reduction whilst delivering theall important revenue curve the right way is exactly why social media companieslike ours boom during downturns. Everyone needs to do it, especially now”.
Obviouslythe facts seem to support the claims but it’s important to point out thatsocial media if executed incorrectly can actually cause the exact opposite ofthe revenue producing panacea that you may be expecting. The fact is that Cyberspace is both honest andincredibly hard to stage manage; a CMO becomes accountable very quickly for theactions of his company and the quality of his products and services.
Whenasked how a campaign can be staged – “That’s a very bad idea, staging acampaign and spinning it is going to hurt you very badly and eat into yourbrand equity, a Social Media campaign should focus on the facts and encouragedialogue even if its not what you want to hear, its handling the responses thatmay not be positive in exactly the right way which will deliver you brandequity and revenue” so what happens to the companies that don’t embrace socialmedia going forward? “In short I wouldsay that any company not using social media at this point in time has somepretty significant issues with their CMO, its highly complex but its not rocketscience and any CMO worth their salt will have a strategy or a partner in placeto take advantage of the complete turnaround of media delivery from broadcastto a network of dialogue”
“SocialMedia makes you accountable, its just as likely these days for us to be calledin to handle Crisis communications for a company being badly beaten up onlineas it is to be asked to deliver a revenue strategy. I can think of two separate occasions where asingle unhappy customer has had over 1M USD lost revenue impact to the clientsbusiness simply by refusing to accept bad service or a less than acceptableresponse from the company. If someone isreally angry with you they have every tool at their disposal for free to destroya company’s brand equity – especially if the company is at fault”
SocialMedia the credit crunch avoidance mechanism for a CMO? Potentially but so isswimming through shark infested waters to escape a desert island, you know youhave to do it but you certainly want to do it carefully when you have your witsabout you.
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