Archive for December, 2008

Social Media Marketing Isn’t Free but it is Terribly Efficient

Given my position at Federated Media I get to see a lot of client and agency professionals.  Many of these people share a common frustration.  Their clients (internal or external) think social media marketing is free.

It isn’t.

They also expect it to produce amazing results so they are saddled with expectations that are unrealistic in addition to no real budget.

Social Media marketing isn’t free.  But it is terribly efficient.

Social Media Marketing is like entertaining in the physical world.  If you want to share an experience with a group of people (either personally or professionally) you need to go to where the people are and get their attention or entice them to come to you.  In either case, you have to invest something to get a return.

Extending the simile, there are ways to reduce the cost entertaining. Let’s look at some potential executions and the cost associated with them.

$$$$$ You could rent a space, spare no cost and have the finest chefs and entertainers pulling out all the stops to make your party a success.  Let’s say we get performers from Cirque du Soleil, Paul McCartney/Radiohead/Jay Z/Foo Fighters/ or similar with Wolfgang Puck doing the cooking… want to come?

$$$$ Instead of renting a hall/room you can have the party catered at your house/office.

$$$ Instead of hiring a caterer you could make the food yourself. Of course, you must know how to cook.

$$ Instead of making food you could have your guests bring the food.

$ You could meet in the park/beach/coffee shop and just hang out.

As the cost goes down, the investment in the relationship goes up with those that attend.  I’m quite confident I could fill a hall with people if I had the best band, chef, location, etc.  The number of people who would meet me in a park to hang out is much lower but the people who would come mean much more to me.

That is the trick with Social Media.  It isn’t free but the low cost of the tools make it feel free from a distance.

If you go to where the people are (i.e. Facebook, Twitter, the “blogosphere,” etc) you must invest time, money, and energy to stimulate a conversation.  Marketers can and do create fan pages, groups, and even applications for very little money.  But creating them and getting people to use them are two very different things. The people who become a fan of you your brand within Facebook or subscribe to your brand blog’s RSS feed are the people your brand has already converted.   To grow beyond that base you must invest money, time, and energy.  If you are the social media equivalent of a fantastic chef the out of pocket costs are still relatively low.  For most brands, they will need to invest in a private room at a restaurant or a caterer.

Does that make Conversational Marketing less attractive? No!

The benefit of Social Media isn’t the initial cost it is the return.  If you invest time, money, and energy into a conversation with your potential customers you build equity with prospects at a scale that becomes extremely meaningful.  As you build these relationships, you gain the ability to get more out of that relationship.  They will share their feelings with new prospects, they will defend your brand in place you can’t, and they will amplify your message.

Marketers, I share your frustration of many with the expectation that social marketing equates to (virtually) free marketing and the unrealistic expectations that come along with this.  This commonly held perception does open the door to a very compelling discussion around efficiency and value and that is one we all must engage in.  Let’s have that discussion.

Blogs as Purchase Drivers

Study finds that blogs are extremely effective at driving purchase decisions.

Agency Mashups the Path to Growth for Marketing Agencies

collisionMarketing agencies are facing a lean year ahead and it is accelerating the Mashup of the marketing world.

So here’s the agency pitch for 2009:

Creative agencies – This isn’t just about the copy and visuals.  It is about where and how they get to potential customers.  Mr. client, you don’t need media buying services, we’ll do that.  The placement is too important to the success of the program to be separate from the creative. Our creative is so good, it will generate buzz, give us your PR budget too!

Media Buying – Finding the right audience and the way to reach your target is more important than ever.  Media placement is so important that we need to do the creative too.  Oh, and when we do a good job, this will go viral.  We’ll take that PR budget too! Creative falls flat unless it is in the right place.  We’ll give you a good program based on the environment.

PR – Ads limit your ability to reach your customer.  PR is no longer just pitching journalists and dealing with formal requestions and emergencies, it is about creating buzz.  Your media and creative budgets would be so much better spent with us.  The PR is too important to the success of the program to be left off to the side!

They are all right.  With budgets shrinking the fight will grow.

The Underlying Issue with most Online Display Advertising

If you were accosted by annoying salespeople upon entering a store (say an electronics store or a car dealer) would you go back?

If a restaurant served whatever they wanted to serve instead of letting you order would you return?

The online advertising industry often acts like the store and restaurant I describe above.  And it is a real problem.

The problem is one that speaks to the heart of the differences between online and offline advertising.  Offline advertising is about making the most of a limited space or a fixed period of time.  Online advertising may rely on ad units that are relatively small, but the ad provides frictionless access to almost endless information.  The online ad industry has not taken advantage of this.

In fact the effectiveness of online advertising is directly impacted by the typically terrible user experience that occurs when someone clicks on an ad.  The subsequent experience – typically called a “landing page” by those in the industry – tends to be one of three things:

  1. An overly produced experience long on polish and short on information.   People click for a reason and it is rarely to see another ad.  These landing pages often fail to satisfy.  Typical customer reaction – “Now what do I do?”
  2. An experience that has only minimal relationship to the ad creative that prompted the click.  (Think an ad that dumps you on a corporate home page.)  Typical customer reaction – “I’m close, but do you expect me to dig for more information?”
  3. A poorly conceived user experience.  Unclear navigation, insufficient explanation of content, bad url structure, dead end pages, etc.  We’ve all been there.  Typical customer reaction – “You’re wasting my time.  I’m sure what I need is here but I can’t figure out where.”

I believe these bad user experiences do two things that generally diminish the effectiveness of online advertising.  First, they cause people viewing ALL online ads to believe that clicking on an ad will result in one of the experiences described above.  It is like going to a car dealer, I don’t expect to be helped I expect to be hassled.  Sure, some dealers are helpful but I don’t expect it.  Second, bad user experiences prompts advertising creatives to focus on becoming more and more disruptive so as to deliver the information typically found on a landing page without having people click. Kind of like the telemarketer that won’t stop talking because if they do they know you will tell them to shut up.

There are instances where I can imagine putting up with annoying salespeople.  Say the store had great prices or had a selection unrivaled by other stores.  There are restaurants I would go to and blindly let the chef serve me a meal and many super high end restaurants do just that. But generally, I would imagine that most people would avoid the store and restaurant described above most of the time if they had a choice.  And they almost always do have a choice.

Is this why interaction rates with ads continue to decline?

What to do?

If you are a brand marketer, you may not like it but it is necessarily true – you are now also a publisher. Gone are the days where you could create compelling ads and then rely on other groups (your retail partners, your sales force, your event team, etc.) to then expand on your static ad message.

If you work on online advertising creative, hire or become a UI expert.  A rich experience isn’t often the prettiest but it is the most useful and effective.  Talk to publishers about what makes their audience tick and give the audience what they love. Think about how to get people to come back because they want to come back.  Earn their attention and they will give it to you.  You landing page is a website.  Your customers don’t care about microsites, landing pages, sitelets, etc.  Make a great web site.

If you are a publisher, you know how to do this.  You make properties (one would hope) that engage with a market segment and compel people to come back.  You can no longer expect your advertisers to support your site simply by playing within the space or time you’ve set aside for their message.  There is more ad space and time than advertisers need.  You will need to help them understand how to engage with your audience.  You are a solution provider rather than the provider of a solution.

If you are the target of advertising, and we all are, demand the providers you support with your dollars to respond to you.  Having a problem with a product?  Tell people about it or let the company know via Twitter or another service.

Of course I’m being harsh.  There are great online advertising user experiences produced all the time.  I’m painting with an intentionally broad brush because a majority of programs aren’t good and it is causing everyone to expect an extended ad experience rather than a rich, fulfilling, useful exchange.   While online advertising was borne out of the print/tv business it actually has much more in common with event marketing and/or telemarketing.  Create an experience that can inspire your customers to dig deeper and you will earn their attention.