Sorry, Brands…Your Digital Agencies are Lying to You - Levi Shapiro

Brands spend a fortune on marketing amp8211 more than 9 b2c and 7 b2b of total revenue Within marketing budgets the fastest growing portion 40 is social media Unfortunately a growing body of evidence suggests that garnering LIKES on a Facebook page does nothing to foster community or increase engagement Your digital agency has been lying to you The better approach for lowering customer service costs and increasing engagement is to transform your organization into a social businessStep I Focus on managing your own portal not Facebook The single most important aspect of a social business according to amp8220 The Social Economyamp8221 from McKinsey is user generated content A vibrant community can produce user generated content with customers helping each other and innovative product ideas emerging from the communityOne notable example is Amazon whose share price has risen more than 400 over the last 5 years Product reviews on Amazonamp8217s portal create a Word of Mouth experience Product and marketing ideas notably the Kindle have emerged from Amazonamp8217s online conversation with its 166 million customers not its 56000 employees Amazon consistently ranks among the top brands in the University of Michiganamp8217s annual Customer Satisfaction IndexAccording to Andreas Nicklas Head of Business Development EMEA for Lithium who will keynote this week at Socialize13 in Tel Aviv amp8220Facebook should be less of a priority than your own website It is crucial to cultivate your own community on your own portal and own the interaction Our data shows that 90 of consumers trust their peers but only 14 trust advertisers Too many digital agencies still advocate push marketing defining success in LIKES even though the world changed from push to pullamp8221Unrealistic values are frequently ascribed to Facebook LIKES even though less than 5 of those liking a Facebook Fan page ever return ComBlu amp8220State of Online Branded Communitiesamp8221Giffgaff in the UK is a social business that generates 75 of all sales by word of mouth More than 85 of all community questions receive responses within 60 seconds Finally only 05 of all incoming customer service requests are handled by the customer call center The rest are answered by the community Becoming a social business has drastically reduced GiffGaffamp8217s marketing and customer service expensesStep II Integration Across the Organization and Business Processes According to McKinsey only 3 of companies obtain substantial benefit from social technologies across customers employees and business partners The main reason is that social does not fit into a silo approach For example the same customer interaction could provide input for multiple departments but typically is not shared across the organization Andreas says amp8220Sometimes you talk with the CMO sometimes the head of customer support Organizations should have one person who owns social strategy across the entire organizationamp8221One example of social commerce is Sephora Beauty Talk a contentcentric forum for young women to learn from their peers and obtain feedback Besides the ongoing discussion Beauty Talk brings the conversation into the store Community members in Sephora shops are invited to take photos and solicit feedback from the Beauty Talk community In realtime the community provides trusted feedback Community members purchase 25x more than standard customersThe technology and telecom sectors have been the first to embrace social business processes More recently retail and financial services companies are moving in this direction So when will your company become a social businessLevi Shapiro is a Partner at TMT Strategic Advisors a research and strategy firm focusing on the technology media and telecom sectors He can be reached at levitmtstratcom or via twitter levshapiroRead all Levi39s MediaBizBloggers commentaries at Unleavened MediaCheck us out on Facebook at MediaBizBloggerscomFollow our Twitter updates MediaBizBloggerThe opinions and points of view expressed in this commentary are exclusively the views of the author and do not necessarily represent the views of MediaBizBloggerscom management or associated bloggers MediaBizBloggers is an open thought leadership platform and readers may share their comments and opinions in response to all commentariesImage courtesy of FrameAngelFreeDigitalPhotosnetClick here to read genConnectamp8217s interview with Jack Myers on dual mentorship in crossgenerational workplaces

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Sorry, Brands…Your Digital Agencies are Lying to You - Levi Shapiro

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