Tuesday, 16 December 2008

Why it makes sense to be engaged with your social market place...

Would it be fair to say that we are experiencing a major shift from traditional advertising methods? From television, radio and traditional publications, brand and content is expressed to the consumer in one direction. Modern and emerging mediums provide a more interactive, involved and engaging experience through a bi-directional channel. This is at least the case for the young, connected, and digital savvy generation who are becoming harder to penetrate through traditional advertising for a variety of reasons. These range from physical and technology factors including email and spam filters, connected communities such as facebook, mySpace, browser pop up blockers, on-demand TV filters such as TiVo and voicemail to text services such as SpinVox, it seems the only way to connect with your audience is to join them in their space in their terms. So even if the message gets through to this new digitally competent audience, it is more important that it is engaging, relevant and useful in a world connected through reviews, opinions and recommendations. After all, it is this medium that will build greater trust in a brand and in turn, improve a brand's reputation. It is no longer what you are being told by marketers that resonate but what peers are recommending or reviewing on your behalf.

Just look at successful market place sites eBay, Amazon and Trip Advisor or sites such as Digg.com or LinkedIn, the main drivers behind their continued ascendancy are reviews, opinions and recommendations by a connected community who pride themselves on credibility and reputation by being engaged – What is the value of this engagement? How do we measure this? And ultimately what is the ROI of creating such a social market place. The question remains; how do you drive the value of engagement and how is this impacting your business and reputation online?

Lord Leverhulme, the soap powder magnate, once famously said: “I know 50% of my advertising budget is wasted – I just don’t know which half”. This was of course in the context of traditional TV advertising. In contrast, today we have the benefit of digital content and interactive media which allows us to measure customer engagement in real time through analytics, digital footprints and online monitoring – making it, in theory at least, possible to measure 100% of spend accurately although I challenge any online business to actually be dedicated to making this happen. However, there is a continued frustration with traditional web analytics, in that the measurements employed define success via traditional click-based and time-based metrics, instead of genuine engagement and influence based metrics.

Engagement is a holistic characterisation of a consumer's behaviour, incorporating more detailed behavioural characteristics such as loyalty, satisfaction, involvement, Word of Mouth promotion, and complaints but very few businesses or organisations are measuring this let alone actually integrating it into any of their digital marketing strategies and current ROI measurements.

The days when a customer’s only touch point with a brand was the URL of a website are well and truly over. Now it is increasingly important to have knowledge and understanding of how your customers have interacted. Who has subscribed to your news RSS feed and product offers, downloaded a podcast from your website, reviewed your book or product on Amazon and eBay, downloaded a news or product widget and blogged / commented about your product or brand while sharing this with friends and family through facebook, bebo or MySpace. This new shift in consumer behaviour, enables people to engage with your brand, which allows them to collectively shape and influence your reputation. It is this that requires monitoring and understanding in the new social market place.

We must also start to consider that as we face one of the toughest economical times in our lifetime, any competitive advantage or social marketing strategy must include an engagement framework that allows businesses to filter through the noise and focus on the important digital influencers that are either positively or negatively impacting reputation or success in the connected world. In times like these its increasingly important to be close to your customers by working smarter to maintain an ongoing relationship – its cheaper to keep an existing customer than to attract a new one.

I would say it is no longer good enough to rely on traditional metrics, which provide inadequate insight or ROI, and rather focus on preparing and developing an engagement framework. In my experience from travel ecommerce a product with a neutral or positive review for example will outsell a similar product at least 4 to 1. How many times have you looked up Trip Advisor before booking your hotel or read a blog on a particular location or resort, before buying a book I can guarantee that most of you would have read a review or searched on Amazon for comments and blog posts. How many of you have asked a friend or colleague for their opinion or advice about make a decision? This all relates back to measuring the value of engagement through being involved in your networks via blogs, wikis, forums and communities. Helping people make advised decisions and then measuring the value of the response through an engagement framework.

Giving some serious thought to planning how to measure your reputation and success through an ‘Engagement Framework’ based on measuring Involvement, Interaction, Intimacy and Influence is a fundamental step towards figuring out which 50% of the advertising budget has been unsuccessful and which 50% has engaged with your visitors will be a huge leap forward for digital marketers who are constantly trying to justify ROI around social media strategies that is customer-centric instead of business-centric. If you communicate with customers based on where they are in their Relationship with your company, the communication would be more relevant to the customer, so your marketing would be more successful and profitable over the long run. All seems to make sense so lets get engaged!