Social media leads to fundamental change in companies, it is far more than marketing or simply new marketing tools. This presentation outlines the impact of social media on business and how business should deal with it.

1. Social media:new marketing tools –
or a fundamental change for business?
Presentation prepared for the Social Media
Branding & Marketing Strategies 2011 Forum,
Johannesburg, 24th November 2011.

2. Background
• There is no doubt that social media has impacted the way we do business
faster and more fundamentally than anything else since the advent of
information technology.
– Yet, whereas information technology was an inside-out phenomenon,the social media
era is an outside-in phenomenon. It enables consumers more than it enables business.
– Whereas many companies called themselves “customer-centric” before, mostly paying
lip service to it, social media has put the consumer in the boardroom, whether
companies like it or not. They cannot avoid it, hence they need to deal with it.

3. Background (cont.)
• Yet, in my experience, hardly any company is prepared for this. If companies
were unable or reluctant to be truly customer-centric before, the new era will
be suicidal for companies that cannot dramatically reform themselves.
– In this presentation, I will outline the ways in which I believe social media will most impact
business, and suggest ways for companies to not only cope with that but that to leverage it to
their competitive advantage.
• This is as much a strategic as an operational argument.
• It is much more than a marketing argument.
• It is certainly not only about new media being available to business.
• It will elevate quality of delivery as a critical success factor for business more than ever before, as non-
delivery will be transparent to all.
• Paradoxically, it will re-balance the traditional marketing equation where marketing communications
became the central marketing tool for most companies.
– Product will once again become central.
– If anyone disagrees with this statement, just compare the low levels of customer satisfaction in
most industries and for most companies.
» Customer satisfaction is fundamentally a response to product or service delivery,
not to marketing.

4. SO:
Do not see social media as a marketing tool,
that is a fundamental mistake.
It is a business imperative.
It is not your decision as to whether you engage that way.
That decision has been made for you.
My belief is that social media now needs to be central to the
business argument.
This makes it a strategic issue,
not merely an operational one.

5. Is this the end of the lipstick on the gorilla?
For many years companies could get away masking
bad quality or service levels with good marketing… no
longer…

6. Social media is now WHAT people do with their spare time…
Source: Nielsen

7. Regular users are
also active in society…
Hence they are
engaged & vocal!
Source: Nielsen

8. Just to remind us all:
what are the key changes we are facing?
• Universal access to information.
• Independent sources of information dominate.
• Most decisions are now mediated.
• Facts and opinions gets equal weight in the consumer dialogue.
• Companies are now “naked”.
• Industries blur more than ever before.
• A total change in the competitive mindset of consumers.
• An equalisation of companies and consumers.
• An equalisation of large and small companies.
• A loss of control by companies.
• A shift from a money based marketing model, to a person-based marketing
model.
– It is not how much you spend, it is how much quality “person-time” goes into it.
– Added to this is how “good” a company is, in all ways. Sincerity & honesty is vital.

9. What does this era mean to us in business?
• We don’t know! The advent of social media brought about huge
amounts of uncertainty for business. Business have more often faced the
negative consequences.
– No-one can be exactly sure how it will impact business. Not even the most informed are
100% sure. Business do not like uncertainty - on top of the uncertainty of dealing with
emerging economies and the global financial turmoil, this is the most challenging time
we ever faced.
– It is fair to say business in general is not ready for social media.
– Yet it requires change: this is not a “passing phase”.

10. For a company: DO
1. Review your business & marketing objectives relative to your social media
objectives.
2. Review how you view/ engage the consumer in your company. Listen more
than you talk. Become really cUstomer-centric.
3. Re-align your people, company structure & operations. Now the consumer is
king/ queen, with all the volatility that comes with that.
4. Check & manage your product & service integrity. This will become the “P”.
5. Marketing as a discipline to marketing as a way-of-life.
6. CONTENT RULES! Unless content engages, it is irrelevant and will simply go
unnoticed. This implies a shift away from sheer scale or money dominating
marketing.

11. DO:
1. Review your business & marketing objectives relative to
your social media objectives.

12. We engage in social media selection &
implementation - before we consider why.
•Consumers do not WANT to engage with most
companies: they are either not liked enough or
important enough to them.
• The result is a “corporatisation” of social
media: websites simply go onto Facebook;
followers on Twitter are mostly staff; Youtube
posts are of advertising or other marketing
content of interest to the company; requests &
compliments are often posted by staff.
•So we treat social media like we treat
traditional media. This is fundamentally
wrong. Unless we simply do not know
what to do with it!

13. Strategic questions you need to ask before you act:
• What is the purpose of your social media engagement?
• How does your social media objectives fit into your business objectives?
• Whom are you trying to communicate to and/ or engage with? What segments of the
market are they? Why are you communicating with them?
• What are the prevailing attitudes & perceptions of these segments?
• What are you trying to communicate to them? Is that important to them & will that
differentiate your company/ brand?
• What format will be best for that type of communication or engagement?
• What “content quality” will best serve this engagement? Will that appeal to
consumers? Will it generate viral expansion of the content?
• What are the product &service quality, people, structural, operational & marketing
implications of that?
• How will social media channels amplify or compliment your marketing & other
marketing communications activities? Are they all objective related?
• How will you measure success?
(Source: an expansion of the Shimamoto, Hawaii-based social media strategist views on
Slideshare.)

14. This should, amongst more strategic issues, result in
a decision-matrix such as the following example.
Business objective/ Relevant segment Example formats
purpose targeted
Create awareness. Youth, 21 – 24, non-users of Youtube with exceptional content.; exceptional
banking products. blogging; wide networking media presence (i.e.
Users of transaction accounts Linkedin profiles of all directors); emails to contacts.
at competing banks.
Personal networking/ expand Existing A+ income customers. Facebook; twitter; Flickr; Youtube; Q & A’s in Linkedin;
networks. Existing small business owners RSS feeds from blogs; check the blogs in your industry
with a turnover of between R5 through Google.
and R10 million.
Engagement/ communication Facebook; twitter; emails; cellphone messaging;
with customers. applications for phones and tablets.
Expertise/ thought leadership. Existing small business owners Blogs; twitter; websites; Linkedin and other expert
with a turnover over R10 discussion groups; Podcasts; Webinars; Slideshare and
million. shared blogs; Youtube; contribute to Wikipedia.

15. DO:
2. Review how you view the consumer in your
company. Listen more than you talk.

16. There are two sides to any marketing engagement,
regardless of the communications tool used.
The company with the The consumer who may - or may not - want
intention to engage with the to engage with the company:
consumer: • On existing business.
•To sell. • On potential business.
• To manage relationships.
• To build reputation.
The company The consumer

17. A paradigm shift is needed: FROM.
The company
connects
with the
individual

18. TODAY COMPANY ENGAGEMENT ARE
CORPORATE.
• Social media usage are
extensions of websites/
corporate profiles.
• No consumer needs-based
The company engagement.
connects • Not of natural interest to the
with the consumer.
individual • No immediate benefit to the
customer.
• Largely defensive, unlikely to
ever become a serious tool of
engagement – or even
marketing or sales.

19. A paradigm shift is needed: TO.
The company The
connects individual
with the connects
individual with the
company

20. CREATE NETWORKS & TAP INTO NETWORKS OF
INFLUENCERS & CONSUMERS.

21. CONNECTIONS START FROM
A CORE OF COMMON INTEREST.
•LISTEN more than you talk!
•Links are consumer issues/ needs
based. The company needs to
identify these and link into them to
create engagement. This must be an
honest and transparent
The company
engagement. The benefit must be
connects reciprocal, not one-way.
with the • Links are natural extensions of
individual issues, people, content, needs,
entertainment.
• Of benefit to the customer, even if
just to inform, entertain or engage
them.
• Links into existing consumer
networks.

22. Whereas the company “pushes” in traditional marketing
communications, we need to get the consumer to “pull”.
Create the “link” of reciprocal benefit and leverage the best tools to engage.
The consumer pull is created
The company through:
push is created • Needs.
through • Relevance of information or
relevance of content.
content matched • The visibility and impact of
to consumer content. The consumer
interest wanting to “send-it-on” to
his/ her contacts.”
Understand consumer needs well enough to find meaningful and honest ways to
engage.

23. The way the tools seem to be used best.
•Websites.
• Profiles. •Linkedin profiles. • Twitter.
• Newsletters.
• Online brochures. • Discussion
•Facebook groups and
profiles. forums.
• Blogs.
The company The consumer •Youtube.
Where Where engagement must go –
involvement is and where the opportunity lies.
now. One-way. Two-way.
Line of greater engagement.

24. How do you listen more? Some tips that may help.
• Interpret your competitive space wider. View it as consumers will.
• Create consumer networks.
• Create influencer networks.
• Create staff networks.
• Conduct formal research.
• Read widely and see what make companies and brands work.
• Observe what people do.
• Trust your intuition.
• Use supplier networks.
• Use your own structures like Call Centres, customer service departments,
staff and salespeople.
• Monitor & measure. Learn.

25. DO:
3. Re-align your structure & operations.
Now the consumer is king/ queen, with all the
volatility that comes with that.
Consumer
CEO
Human
Operations Finance
Resources

26. The shifting paradigm & its resultant marketing &
operational implications.
Ongoing engagement: assessing needs; consumer as part of the
decision-making about new products & services; ongoing interface
& feedback; consumers as partners in the growth & expansion
process by linking with their networks.
The company The consumer
Ongoing interpretation of consumer needs; adjusting
product & service development to be responsive to
consumer needs; nimbleness of performance at all levels;
customer value delivery central to the company structure &
operations - hence a more efficient delivery machine;
systems and operations adjusted & flexible to adapt;
marketing processes enabled 24/7.

27. Organisational implications.
• The marketing department has to change to marketing as a way-of-life for
everyone in the company.
• How is the consumer represented in the boardroom & within the
company processes?
• How is knowledge about the consumer gained?
– By whom and how?
• How far into the organisation does it permeate?
• Is consumer research enough? Most certainly not but as such research is
now critically important (as it should always have been anyway).
– If not, what else will be done to include consumers centrally?
– How will ongoing meaningful engagement be created?
– What “checks & balances” are put in place?

28. What role does the following play?
• Why you gain or loose customers?
• The Call Centre? Online commentary.
• Customer Service?
• Day-to-day operational staff?
• Sales staff?
• Suppliers and partners?
• Mediators & influencers in society?
• Objective panels of customers and non-customers.
• Important “communities”.
• Social media commentary monitoring wherever it occurs.
• Company responses and the reactions to that.
• Pro-active company engagement initiatives.
• Engaging in areas like CSI.

29. DO:
4. Check & manage your product & service
integrity. Nothing will be more important now.
The Chinese symbol for integrity.

30. Quality is now paramount. A return to the fundamentals
of marketing: satisfying consumer needs.
Flash-era of business & marketing. Substance-based era of business.
• Believe what the marketer says. • Quality of products & services.
• One-way. Does it deliver for customers?
• The dominance of flash over • What the consumer actually sees
substance. and experiences (what the
• Marketing budgets rule. product does and looks like).
• Fact and substance-based.
• Yet, amidst emotional consumer
volatility!
“Design is not just what it looks like and feels like.
Design is how it works.” (Steve Jobs)

32. DO:
5. Marketing as a discipline to marketing as a way-of-
life.

33. Marketing now becomes a matrix function that
permeates all other functions.
• How social media integrates with other marketing & communications
tools.
• How to structure for credible, empowered and ongoing engagement, 24/7.
• How to turn all executives and staff into marketers.
• For me, it is translating the company and brand values into the
operations of the company – its systems, people, processes.
• How must the company operate to satisfy consumer
needs in its company-specific way? This means
“unpacking” how customer needs & brand values
impact operational standards.

34. Some companies have always operated
this way,
even though they may not be perfect:
“The Virgin brand (philosophy) is built
around an idea — being the
‘people’s champion”’.
Virgin finds gaps in how
other brands service or
under-service their
customers…and then
jumps in…

35. How do we unpack how consumer needs & brand
values connect with our operations?
• Take every department in the company.
• Assess what consumers expect.
• Interpret that in terms of how your particular company will deliver “on-brand”.
• With the operational staff in that department, assisted by the executive, unpack
how the intersection of these areas impact:
– Structure & hierarchy.
– Constraints to customer delivery.
– Systems.
– Processes.
– Staff recruitment.
– Staff training.
– Decide clear standards of performance, i.e. how will customers be greeted, what happens if systems are off-line; how
are complaints dealt with; how are exceptions handled. Standardise& indoctrinate staff. Apply the principles of
franchising.
– Set clear staff KPI’s.
• Portray that visually.
• Launch, train and institutionalise. Carry on doing it, never stop.

36. DO:
6. CONTENT RULES!
Unless content engages, it is irrelevant and simply goes
unnoticed. Only then is vehicle important.
• A great photograph of the Phoenix that
stranded on the KZN north coast
recently, posted on Facebook, received
17 000 hits in less than 24 hours!
• Within one day, Susan Boyle became a
global sensation.
• Yet, most content goes largely
unnoticed. Creativity/ relevance vital.

37. Frank Marquardt (Mashable)
Guidelines for great content
engagement:
• Know your voice (who you are).
• Time well.
• Know your audience.
• Solve problems.
• Be truthful.

38. I think it is fair to say that the bulk of social media usage is more obsessed
with the channels used, than what are done with it.
The iconic uses of social media are rare relative to the number of uses
overall. This needs to change.
We cannot bore people into submission.
Where we could still spend a lot of money on a mediocre advertising
campaign and get noticed, ONLY valuable content will engage consumers
today.
Compare how little money worked virally for brands like Old Spice.

39. The Virgin Atlantic “still red hot” campaign (2009) started a viral explosion.
“… it energized and engaged a whole new constituency out there…”
Steven Ridgway, CEO of Virgin Atlantic.

40. You also need to decide how you will engage 24/7:
what content and channels.
• Decide: internal or external structures: I believe both are required.
• Two things require management:
– Operations:
• Structure to manage & engage.
• 24/7.
• Select, train, institutionalise consumer needs and the brand values.
• Empower to act.
• Monitor & measure.
– Content:
• Manage internally in conjunction with the operations.
• A mix of internal & external resources.
• Use a network, not only dedicated resources. PR & other agencies as useful as traditional
advertising and social media agencies. It is about great ideas encapsulating messages,
regardless of where they come from.
• Use diverse resources.
• Use unusual resources like Vega/ architects/ editors/ university lecturers.

41. Conclusions.
• Do not see social media as “a marketing thing” that may simply impact
some aspects of how we market.
• It is a fundamental change that puts the consumer central in the
boardroom. This is a HUGE change for most.
• It has implications for:
– How we listen to consumers.
– How we create products and services of quality &integrity.
– How we stop using social media as an extension of our corporate profile.
– How we structure and operate to make the consumer central and turn the company
into a marketing company.
– How we select, train and empower staff to operate this way 24/7.
– How we turn our companies into market-driven organisations.
– How we ensure that the content of our engagement is interesting and challenging
enough to engage consumers.
– How we structure ourselves to manage the engagement.

42. We will need to make the rules as we go along - with the mistakes that come
with it. Best practice is still rare. It is truly up to each one of us.
This is the most exciting time in marketing ever. And a return to marketing as
central to business.
Thank you & good luck!