Charlene Li

1

Creating A Coherent
Social Media Strategy

Charlene Li
Altimeter Group
2011 April 12
Twitter: @charleneli
Email: charlene@altimetergroup.com

3

It’s time to move past experiments

© 2011 Altimeter Group

It’s about RELATIONSHIPS


5

Agenda
 Strategy
 Lead
 Prepare


6

Agenda
 Strategy
 Lead
 Prepare


7

Strategy Process Stages

Formulation
Discovery Ideation Planning Roadmap
& Alignment


8


Formulation
& Alignment

Set context
• Determine key objectives
• Level of strategy (corporate, biz unit, brand)
• Identify key metrics
• Assess readiness


9

Align social with key strategic goals

Examine your
2011 goals

Pick ones where
social will have an
impact


10

Objectives differ by level

Corporate
Risk
management Business unit
Consistency
Leadership
development
& culture
across brands

Social strategist
Brand
& COE
Community
Engagement
Channel focus manager &
metrics
education
Value metrics ROI metrics


11

Ask the Right Questions about Value

“We tend to overvalue the things we can
measure, and undervalue the things we
cannot.”

- John Hayes, CMO of American Express


12

Use appropriate metrics at each level

Corporate Business metrics: revenue,
CSAT, reputation.

LOB/Geo Social media analytics: Insights,
Stakeholders share of voice, resonance,
WOM.
Social Engagement metrics: fans,
Strategist/Community followers, clicks.
Manager


13

Assess your readiness to be social
 Highlight where you are strong, where you need
to develop.
 Don’t create strategies that you can’t execute.
 Demonstrate impact of strategic work.
 Categories for readiness assessment
• Customer Profile • Communication
• Market Analysis • Mindset
• Processes • Roles
• Organizational Model • Stakeholders
• Education • Monitoring
• Reporting

14

Benchmarking Social Readiness (Before)

December 2009


15

Benchmarking Social Readiness (After)

April 2010


16

Strategy Process Stages - Discovery

Formulation
& Alignment

Collect and prioritize strategic options
• Metrics-based value assessment
• Prioritize against objectives


17

Evaluate each initiative

Impact Readiness
• How does it • Are there
support an people who
objective? can do this?
• What metrics • Is there
matter? budget?

Risks Priority
• What are the • Does this
risks if we do initiative
this? enable other
• What if we work?
don’t?


18

Define Your Strategy With Objectives

Dialog

Learn Support

Innovate


How does social media matter to B2B?

Chief stakeholders may
not be using social media.
• But lieutenants will be.

Social media is impacting
how B2B decisions are
being made.
• Background research
• Expertise
• Search results impact


20

People in B2B use social media for work

Read user ratings/reviews for
62%
business products/services
Visit company profiles on social
62%
media sites

Visit company blogs 55%

Participate in online business
51%
communities or forums

Ask questions on Q&A sites 49%

Use Twitter to find or request
29%
business information

Source: 2009 Business.com Business Social Media Benchmarking Study (n=2,393)


21

Agenda
 Strategy
• Learn
• Dialog
• Support
• Innovate
 Lead
 Prepare


22

Track brand mentions with basic tools

What would happen
if every employee
could learn from
customers?


23

Integrate monitoring with workflow

Other providers

Alterian
BrandsEye
Buzzmetrics
Cymfony
Sysmos
Visible Tech.

From Radian 6, to be acquired by Salesforce.com


24

Be sure to track the actual conversations,
not just the tweets

@JaimieH is a top
diabetics advisor
who was talking
with an insulin
pump maker


25

How KLM listened and surprised flyers


26

Go beyond basic monitoring to analytics

Monitoring &
analytics
Deep support
monitoring to integrated into
prep & support everyday
Centralized campaigns
monitoring but workflow
not actionable
Tracks brand in business
mentions unites
using basic
tools
(Google,
Make course corrections
No
monitoring Twitter) nearly real-time.
in place
Use predictive analytics to
anticipate demand.

27

Shoppers want to be “known”

I walk into the store Store knows it’s me

Give me offers And plans my visit

28

Community insight platforms

» Communispace and
Passenger offer
online focus groups
solutions.


29

Pros and cons of private communities
 Private communities give better control
• Get input from specific communities
• Can target specific hard-to-reach communities
 But they are hard to create – and maintain
• Who needs to be included? Excluded?
• Provide non-monetary incentives/rewards for
participating in the community
• Deserves and requires dedicated community manager
• Integrate into your company’s support and innovation
process


30

Learn also from your employees


31

Go beyond traditional data to understand
your customers
Demographic

Geographic

Psychographic

Behavioral

Socialgraphic


32

Socialgraphics asks key questions
1. Where are your customers online?
2. What social information or people do your
customers rely on?
3. What is your customers’ social influence? Who
trusts them?
4. What are your customers’ social
behaviors online?
5. How do your customers use social technologies
in the context of your products.


33

Engagement Pyramid

Curating

Producing

Commenting

Sharing

Watching


34

Engagement Pyramid - Watching
Watch videos
Curating Read blog posts
Listen to podcasts
Read tweets
Producing
Read discussion
forum posts
Commenting

Sharing

Watching


35

Engagement Pyramid - Sharing

Curating Share a link
Share photos
Share videos
Producing Write a status update
Retweet
Commenting

Sharing

Watching


36

Engagement Pyramid - Commenting

Curating Comment on a blog
Write a review
Rate a product
Producing Participate in a
discussion forum
Commenting @Reply on Twitter

Sharing

Watching


37

Engagement Pyramid - Producing

Curating Write a blog
Create videos or
Producing podcasts
Tweet for an
audience
Commenting

Sharing

Watching


38

Engagement Pyramid - Curating

Curating
Moderate a wiki or
discussion forum
Producing Curate a Facebook
fan page
Commenting

Sharing

Watching


39

Engagement Pyramid Data

United
Spain Germany UK
States
Curating <1% <1% <1% <1%

Producing 30.3% 21.1% 52.7% 26.1%

Commenting 45.1% 31.9% 54.0% 34.4%

Sharing 58.6% 61.8% 79.3% 63.0%

Watching 82.2% 78.9% 89.3% 78.1%
Source: Global Wave Index Wave 2, Trendstream.net, January 2010


40

Putting socialgraphics to work
 Conduct research to identify the social behaviors of your
target customer
 Also identify:
• Where are they online: Surveys or brand monitoring
• Who do they trust: Surveys
• Who do they influence: Survey or brand monitoring
• How they use these tools in context of your products: Most
often surveys.
 When you first understand your customers, your marketing
efforts will naturally unfold.


41

Summary - Learn
 Listen and learn from your customers.
 Start with basic monitoring tools, but quickly
evolve them.
 Invest in analytics that matter. Use metrics that
are relevant to your business.
 Understand the socialgraphics of your customers.


42

Agenda
 Strategy
• Learn
• Dialog
• Support
• Innovate
 Lead
 Prepare


43

The New Normal
 Conversations, not messages

 Human, not corporate

 Continuous, not episodic


44

Blogs establish thought leadership

CEO Richard Edelman has
been blogging consistently
since Setpember 2004.


45

SonyEurope rewards Twitter followers with
discount that drives significant sales

SonyEuropes 10% off
VAIO laptops deal to
celebrate their 1,000
Twitter follower lead to
over €1m worth of
product ordered.


46

VW inserted a tweet analyzing tool into their
banner ad to suggest a specific model


47

Spain Tourism used multiple channels to
encourage dialog/sharing


48

Kohl’s engages directly with customers


49

B2B can also use Facebook

• Develop
relationships with job
candidates,
prospects, and
current employees
• Insert your content
into newsfeed of fans
• B2B is really people
to people

50

Encourage commenting to get into
the Facebook news feed


51

Premier Farnell supports engineers with
community, and employees with “OurTube”


52

Getting people to share within your
company

 Give out Flip cameras/smartphones
• Set up an internal “OurTube”
• Transcribe conversations into emails and posts
 Ask people for best practices, reactions, advice,
opinion in areas of passion.
 Recognize key contributors.


53

Tivo joined an existing community


54

Advocacy – A five-phase approach

Phase 4:
Phase 1: Phase 2: Phase 3: Phase 5:
Put
Internal Identify Build Foster
Advocates
Readiness Advocates Relationships Growth
First


55

Tesco engages influencer blogs

Blog post series
highlights & drives
traffic to blogs by
Influencers. Twitter
feed encouages
engagement too.


56

Summary - Dialog
 Have an authentic conversation with your
customers that they want to have.
 Engage across and through social communities
 Engage off of your Web site.
 Recruit an army of customer advocates.
 Respond to your prospects and customers in real
time.


1

Support and Innovate With
Your Customers

Charlene Li
Altimeter Group
2011 April 12

3

Agenda
 Strategy
• Learn
• Dialog
• Support
• Innovate
 Lead
 Prepare


4

Vodafone UK uses Twitter to proactively
communicate with customers

Vodafone UK humanizes
their Twitter account by
including pictures of their
support team and
identifying different
respondents by an “^”
and the team member’s
initials.


5

Ritz-Carlton managers monitor Twitter for
real-time service

Property manager
helped unhappy
honeymooners


6

Support during a crisis

Used #euva and
#ashtag to track
Source: simplifying.com
conversations


7

DellOutlet supports sales with Twitter


Question & Answer sites provide opportunity
for support


9

Q&A encourages dialog too


10

iRobot ties discussion boards into
customers support

iRobot escalates
unanswered
questions into
support centers


11

Salesforce.com Service Cloud ties
social channels back to customer data


12

Solarwinds’ community is strategic


13

Retailer Best Buy has 2,500 employees
providing support via Twitter


14

Summary - Support
 Real-time isn’t fast enough.
 Integrate “social” support into your support
infrastructure.
 Scaling support to meet the groundswell will
require that you create your own
groundswell.


15

Agenda
 Strategy
• Learn
• Dialog
• Support
• Innovate
 Lead
 Prepare


16

P&G uses reviews to improve products


17

Danish bank ask for help to improve
mobile banking on Facebook


18

Finnish post created an idea exchange


19

Fiat invites ideas for a new car


20

Archer collects product development
ideas in a private community


Starbucks involves 50 people around the
organization in innovation

Over 100 ideas
have been
implemented

Dell taps employee ideas too


23

P&G goes outside for innovation

P&G made
outside-in
innovation a
priority

24

Success story: Glad Press’n Seal
 P&G developed technology from diaper research
 Reached out to competitor Clorox to form a new
joint venture
 Helped Glad become Clorox’s second largest
brand


25

ModCloth has customers merchandise
new products


26

Summary - Innovating
 Innovating can come from any customer or
employee interaction.
 Dedicated innovation communities require
significant commitment and nurturing.
 Extend your firewall to bring customers into your
organization.


27


Formulation
& Alignment

Strategy statement
• What you will do
• What you won’t do

Scenarios development
• Implementation roadblocks
• Company and leadership implications
• Risk identification
• Build resilience

28

What’s the Next Big Thing?


29


30

Identify and prioritizing disruptions that matter

User Experience Business Model Ecosystem Value
•Is it easy for •Does it tap new •Does it change
people to use? revenue the flow of
•Does it enable streams? value?
people to •Is it done at a •Does it shift
connect in new lower cost? power from one
ways? player to
another?

31

1) Likenomics (credit to Rohit Bhargava)
“How personal relationships, individual opinions,
powerful storytelling and social capital are helping
brands…become more believable.”

Understand the
supply, demand,
and thus, value of
Likes as social
currency

See http://bit.ly/rohit-likenomics for Rohit’s take

32

Likenomics evaluation
 User experience impact - moderate
• People with high social currency will enjoy benefits,
richer experiences, receive psychic income.
• People with low social currency will find ways to get it.
 Business model impact – moderate
• New economics create opportunity for people who
understand Likenomics to leverage gas.
• The cost of accessing social currency will increase, and
raise barriers to entry.
 Ecosystem value impact – none


33

2) Social Search – Beyond Friends to Interests

Social sharing rises
as a search ranking
signal, esp in the
enterprise

Create a social
content hub to gain
traction

Use microformats to
highlight granularity
(e.g. hProduct &
hReview)


34

Social Search evaluation
 User experience impact - Moderate
• Search becomes more useful, relevant to people.
 Business model impact – Moderate
• SEO takes on a different dimension, rewards
companies with social currency, personalized
experiences.
 Ecosystem value impact – Moderate
• New power brokers are social data/profile players who
capture activity data and profiles.
• Google has little of either.


35

3) Big Data
 Social monitoring merges with Web analytics
• HOT: Omniture, Coremetrics/IBM, Webtrends
 Technology like Hadoop makes it easy for
companies to tap “Big Data”
• E.g. New York Times making its archives public
• Twitter archived by Library of Congress
• Facebook Cassandra, Amazon Dynamo, Google
BigTable
 Data visualization tools make it easy to digest
 Balancing privacy and personalization


36

Big Data evaluation
 User experience impact - Low
• Most users won’t directly experience Big Data.
 Business model impact – High
• New businesses and initiatives can be started at very
low cost.
• Owners of Big Data repositories can assert control,
demand payments for access.


37

4) Game-ification


38

TurboTax used “games” to encourage
sharing and support

Social design can
enter training,
collaboration,
support, hiring


39

Gamification evaluation
 User experience impact – High
• Experiences get richer, more engaging
• Work gets done faster, cheaper.
• New organizational structures and cultures emerge.
 Ecosystem value impact – Low
• Service providers will remain focused, boutique firms.


40

5) Curation


41

Curation evaluation
 User experience impact – Moderate
• User authority established from better curation, better
content is organized well.
• Easier for businesses to create their content.
• Individuals challenge media and brands as authorities –
and publishers that siphon off ad dollars.


42

Summary of disruptions
User Business Value
Experience Model Networks
Likenomics Moderate Moderate Low
Social Search Moderate Moderate Moderate
Big Data Low High Moderate
Enterprise
High Moderate Moderate
Soc Net
Gamification High Moderate Low
Curation Moderate Moderate Moderate


44 44

Thank you
Charlene Li
charlene@altimetergroup.com
charleneli.com/blog
Twitter: charleneli

For more information & to buy the
book visit open-leadership.com


1

Leading The Open
Organization

Charlene Li
Altimeter Group
2011 April 12

OUT of CONTROL?


7

How to give up control
but still be in command


8

Open Leadership

Having the confidence
and humility to give up
the need to be in control,
while inspiring
commitment from people
to accomplish goals


9

10 elements of openness
Information Sharing

• Explaining
• Updating
• Conversing
• Open Mic
• Crowdsourcing
• Platforms

Decision Making

• Centralized
• Democratic
• Consensus
• Distributed


10

Explaining strategic decisions

Open book management

Managing leaks

11

Updating with every day stuff


12

Kohl’s has conversations on Facebook


13

Open Mic: When people contribute


14

Crowdsourcing new Walkers flavour


15

Open platforms make it easy to partner
and share
Open architecture Open data access


16

Decision making models

Centralized Democratic

Consensus Distributed

17

Social technologies make distributed
decision making possible
Manage complex tasks Organizing for speed

 170 employees  65,000 employees
 100 modules with  16 Councils,
“module owners” 50 Boards make
 One person makes strategic decisions
the final decision in  Joint leadership of
each module each group

18

Determine how open you need to be with
information to meet your goals

Openness audit available at
http://bit.ly/opennessaudit


19

Complete the Openness Audit


20

Traits of Open Leaders

Authenticity Transparency


21

Transparency as an imperative


22

How Best Buy became open and social


23

Best Buy’s First Social Media Experts

Steve Bendt &
Gary Koelling


24

The Executive Advocate

Barry Judge
CMO of Best Buy


25

Barry’s first post


26

The Premier Black Fiasco

6.8 million
emails sent
instead of
1,000 test


Developing Open Leaders

2010

“You can imagine the Chatterati creating as
much value as an SVP in the organization by
sharing their institutional knowledge and
expertise - and we should look at
compensation structures with that in mind.”

- Marc Benioff, CEO of Salesforce.com

2010

29

Agenda
 Strategy
• Learn
• Dialog
• Support
• Innovate
 Lead
 Prepare


30

#1 Create a Culture of Sharing


31
#2 Discipline is Needed to Succeed
Take reasonable
action to fix issue
and let customer
know action taken
Positive Negative
Yes Yes
No Does customer
Do you want Assess the Evaluate the
need/deserve more
to respond? message purpose
info?

No Yes Unhappy Yes Are the facts No Gently correct the
Response Customer? correct? facts

No

Yes Can you No Dedicated Yes Are the facts No
add value? Complainer? correct?

No Yes

Is the Explain what is
Respond in Thank the Comedian
problem
Yes being done to
kind & share person Want-to-Be?
being fixed? correct the issue.
No

Adapted from US Air Force Comment Policy Yes
Let post stand and
monitor.


32

Five ways companies organize around social media


33

#3 Ask the Right Questions about Value

“We tend to overvalue the things we can
measure, and undervalue the things we
cannot.”

- John Hayes, CMO of American Express


The new lifetime value calculation

• Percent that refer
+ Value of purchases • Size of their networks
-Cost of acquisition • Percent of referred
+ Value of new customers people who purchase
from referrals • Value of purchases
+ Value of insights
• Percent that provide
+ Value of support
support
+ Value of ideas
____________________
• Frequency and value of
= Customer lifetime value
the support

Spreadsheets for all calculations
available at open-leadership.com


35

35% increase in LTV captured
Year 1 Year 2 Year 3
Number of customers 10,000 5,000 3,500
Gross profit of purchases $400,000 $200,000 $140,000
Cost of acquisition $150,000 $25,000 $17,500
Net profit $250,000 $175,000 $122,500
Traditional LTV/customer $74.89

Value of referrals $30,000 $45,906 $45,287
Value of insights $10,000 $5,438 $4,080
Value of support $5,438 $8,156 $6,120
Value of ideas $2,000 $1,000 $1,000
Net profit and value $297,438 $235,500 $178,986
Revised LTV per customer $101.48


36

Make decisions with metrics
Find more fans
with large
networks Refers
Large
network Doesn’t
refer
Fans
Refers
Small
network Doesn’t
Encourage fans refer
to make more
referrals


37

#4 Prepare for Failure

No relationships are perfect
Google’s mantra:
“Fail fast, fail smart”


38


39

Structure your risk-taking and failure
systems to create resilience
1. Conduct pre- and post-mortems.
• E.g. Johnson & Johnson after Motrin Moms.
2. Identify the top 5-10 worst case scenarios.
• Develop mitigation and contingency plans.
• E.g. Ford’s “lost” Fiesta.
3. Build in responsiveness.
• E.g. Best Buy’s Black reward card.
4. Prepare yourself for the personal cost of failure.


40

Action plan to prepare for failure
 Audit the last few failures you and your
organization experienced.
• 25% - what happened.
• 25% - what you learned.
• 50% - what you will do next.
 Keep a failure file.
 Identify risk-taking training needs.
 Build failure into your planning and operating
processes.
 Create support networks for the inevitable
failures.


42

Give Up Control
AND STILL BE IN COMMAND


Charlene Li

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