The New Currency of Social Media
For the rest of the June 2009 issue of CRM magazine — The Social Media Issue — please click here.
We are about halfway through the social media revolution—social media is now too big to go away, but we are still figuring out how to use it.
The figuring-out process for any innovation involves applying it to everything conceivable. Everything we try ends up with a name, hence we have a raft of new words, or words with new meanings.
Consider what social media has meant for our lexicographers: Social media’s new or refurbished terms include tagging, ranking, and tag cloud; blog, friending, wall, stream, and tweet; communities (feedback and discovery); and co-creation of value. I’m sure I’m forgetting many.
I trace the technology back to a simple idea about marketing offered by Don Peppers and Martha Rogers in the mid-1990s—every vendor-customer interaction is a transaction in which information is the currency. The idea was revolutionary because it also said that the currency flows in both directions simultaneously.
Of course, there was no mechanism for capturing all of that information prior to social media, and the currency of interactions was rarely spent. Social networking and social media came along more or less to capture this interpersonal currency and only recently have we been trying to apply it to business.
So, how are we doing? OK, I guess, but I have a feeling we’re about to learn its limits. We spend most of our social energy passively capturing from the infostream any feedback we can. We process information and use it in increasingly clever ways to improve customer intimacy. That’s all good, but it’s not the whole story.
Passive feedback loops give us a good understanding of how things are now, but they don’t give much hint about where things are going. They represent whatever is top of mind for customers. If that’s your source of input from the real world, you’re essentially driving by watching the rearview mirror. To see the future—and who doesn’t want to do that these days?—you need active engagement and directed questions. Active engagement gives us the chance to drive forward, to pick customers’ brains rather than simply accepting whatever complaints they have.
Active engagement is part of a discovery process that can reveal truths far bigger than those we get from passively listening. This takes thought and planning, though, and involves more than mere surveys. Some of the most important discoveries I’ve seen involving social media came not from asking “How do you like us?” but from open-ended questions such as “How do you feel about…?”
I suspect the old 80/20 rule applies when it comes to using social media in business. The majority of your traditional questioning and data-gathering from the outside world ought to be geared toward learning, for immediate application, what the customer thinks about you and your products and services. But a significant, if minor, amount of social media attention should be oriented toward finding out what customers think even if there is no immediate sale to be gained from it.
Of course, working hard on transactions that don’t (yet) yield revenue will be a hard sell in some organizations, especially today. I can already hear executives asking why they’re spending money on this or that. If you get that response, say something like this:
When customers tell you what they think about their lives—their needs and aspirations—they’re engaging you in a what-if design process. While we think about design in terms of products, such discussions are equally valuable for marketing messages, packaging, offers, how services are provided, and all of the things that go into making the whole product in the customer’s eyes.
This small but powerful amount of information tells us how to innovate around the whole product on a short budget. That innovation can reduce costs, improve internal processes, and generally make our companies easier to do business with. It can also give you the next big idea—you know, the idea that will help your company pull itself out of the recession.
Denis Pombriant is the founder and managing principal of Beagle Research Group, a CRM market research firm and consultancy. He can be reached at email@example.com or on Twitter as @denispombriant.
Every month, CRM magazine covers the customer relationship management industry and beyond. To subscribe, please visit http://www.destinationcrm.com/subscribe/.
Strategy and Social Media: Everything’s Social (Now)
You may not know what you're doing — but your customers do. If the time to act is now — does that mean it's too late to plan?
Maturity and Social Media: You'll Be Social (Soon)
CRM magazine's Social Media Maturity Model, the launching pad for a discussion of the next five years of social media.
The New Connections of Social Media
I don't care to belong to any social network that will accept me as a member.
Social Media from A to Z
An alphabetical glossary of what you need to know about social media.
Whuffie Doesn’t Grow on Trees
Forget money: Trust, transparency, and value represent today's social currency.
Required Reading: Cashing In On Social
Author Tara Hunt explains how The Whuffie Factor can be a company's saving grace.
CRM on Twitter: July 2009
Welcome to the Interboom
CRM Evolution '10 — Day 1: Beagle Research Group founder Denis Pombriant details the three economic challenges that will forever alter CRM.