For leading-edge marketers, social media have moved beyond the novelty stage to a point where they can now produce real business value. There are now a variety of winning strategies many organizations can emulate. However, most firms continue to pursue social media 1.0 tactics — Facebook pages, Twitter accounts, LinkedIn profiles — to attract new customers and engage existing ones. Collecting many "friends" and "followers" is good but it generally does not lead to higher revenue and profit.
[eventPDF]
A new study recently published in the Harvard Business Review looked at the social media strategies and results of more than 60 companies across multiple industries. The researcher, Mikolaj Jan Piskorski, discovered social media strategies that perform well and other strategies that failed to drive the business.
The poorly performing companies universally imported their digital strategies into social environments by broadcasting marketing messages or seeking customer feedback. These programs failed because they do not satisfy the needs of people who come to social media: to meet new people and to strengthen existing relationships. Simply put, users are interested in other people, not companies who flagrantly or subtly look to sell them something.
The successful firms generated revenue and cut costs by implementing social strategies that help people establish and enhance relationships. These programs worked because they were congruent with the users’ expectations and behaviours on social platforms. Social-based strategies are superior to purely digital ones because they tap basic human needs around social connection. With a social-based strategy, the company assumes the role of facilitator of these interactions.
Firms looking to deploy social strategies have four strategic options that vary by business impact (reduce marketing costs, increase or retain revenue) and social goals (meet new people, improve existing relationships). On the business-impact front, some organizations have cleverly leveraged user-generated content to reduce their costs. Reviewing site Yelp, for example, has been able to keep down the cost of acquiring strong content by offering its most consistent reviewers membership into its Elite Squad for which it hosts occasional gatherings. Yelp meets the reviewers’ desire for social interaction while the reviewers provide Yelp with solid content. It’s a win-win situation.
Mitchell Osak is managing director of Quanta Consulting Inc. Quanta has delivered a variety of winning strategy and organizational transformation consulting and educational solutions to global Fortune 1000 organizations. Mitchell can be reached at mosak@quantaconsulting.com