Commentary

Two Reports You Can't Miss

by Joe Marchese , July 21, 2009

With the amount of noise in the "social media" space, given all the social media "ninjas," "gurus" and "experts," it can be easy to miss some of the truly ground breaking-research. Over the past couple of weeks, two reports on social media were released that I feel fall into the "can't miss" category if your job description includes understanding social media. Ironically, one of the reports points out that every employee should understand how to engage in social media. So I guess that means everyone should read the reports. (:

The first must-read report was released by Razorfish and is called "Fluent: The Razorfish Social Influence Marketing Report." This focuses on how important social media is to purchase decision-making, at all points in the purchase funnel. Razorfish asks the right questions of consumers, and is able to demonstrate that even though people claim they don't "turn to social media to make purchase decisions," social media certainly heavily influences purchase decisions. The study provides some great data to back up the argument I made in "Report Claims Social Media Fails As Marketing Medium -- I Claim Bullshit" -- that a prior report claiming social media is a poor marketing medium was asking entirely the wrong questions.

In my view, here are a few keys points from the Razorfish report:

Marketers must understand that the ability to deliver message through "known peer influencers" is the single most powerful tool social media can provide a brand.

As the report states, "Consumers look to brands to help them connect." Brands should not shy away from this responsibility, but rather embrace it, which leads to the next point...

Social ads as the future of social influence marketing. From the report: "...infusing social content and a user's social graph directly into the ad unit itself. Now, advertisers can build social features into ad units." For more on my view, read: "Ad Creative That Works For Social Media."

The Social Influence Marketing Score, or SIM Score, could prove to be a very valuable tool in brands' ability to recognize the ROI on social media efforts. I believe that in the end, the value in the score will depend heavily on its adoption and usage as a currency and measurement tool. Brands need more common metrics in the social space, and it would be great if the SIM Score could help fill that need.

Of course, it gives me unbridled pleasure that Razorfish's report includes a section titled: "Viral Marketing Through Social: No Free Lunch," which helps dispel the myth that social media makes all media become free media.

The other can't-miss report recently released was put out by Charlene Li and Wetpaint. The report is titled "Engagement: Ranking The Top 100 Global Brands." While there is a lot of back and forth over the term engagement as a metric, this study takes a more holistic view of how "engaged" brands are with their consumers over various social media channels. I won't get into more details here, but I can't help but give you the tease that will have you printing out this report right away. From LI's blog: "These Mavens on average grew 18% in revenues over the last 12 months, compared to the least engaged companies who on average saw a decline of 6% in revenue during the same period. The same holds true for two other financial metrics, gross margin and net profit. Note that we are not claiming a causal relationship -- but there is clearly a correlation and connection."

I highly suggest reading both of these studies if your job involves social media in any way, especially if you want to be a social media ninja, expert or guru someday! What gets me excited about the level of detail and process that went into these studies is that we are seeing the social media industry grow up right in front of our eyes -- noving from an experimental playground, to a necessary part of business, and specifically of the marketing mix.

Drop me a line and let me know what you think and continue the conversation on the Spin blog or on Twitter at www.twitter.com/joemarchese.

commentary, social media

4 comments about "Two Reports You Can't Miss".

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Warren Lee from WHL Consulting, July 21, 2009 at 1:16 p.m.
Great article Joe, thanks. There is no doubt that Razorfish adds real value to the discussion on the value of social media or any subject dealing with digital media. It will be interesting to see which of the big holding companies ends up with these valuable assets.
Reply

Greg Verdino, July 21, 2009 at 1:28 p.m.

I see your two reports and raise you a third. Folks should make the time to read Forrester's latest 5-year forecast (or at least skim the public highlights: http://blogs.forrester.com/marketing/2009/07/interactive-marketing-nears-55-billion-advertising-overall-declines.html

The bottom line, total ad spend to decline while digital grows to nearly 25% of the total media spend, with social spend (not including traditional display ads on social networks) growing fastest of all to more than $3 billion by 2014.

Thom Kennon from Free Radicals, July 21, 2009 at 4:51 p.m.

Not sure I would agree that these reports provide us any big new insights re how "social marketing" or "social media" are changing the way brands act, grow and are monetized, digitally or otherwise.

We'd argue that this is old-school social... an obsessive almost singular focus on the "word of mouth", influencer, sentiment measuring that defined the early days of social theory in the digital channel.

Influence activation - as espoused in both of these "reports" - is certainly an important piece of a more robust social marketing operating model, which should include at least three other key dimensions.

One is around managed brand presence and participation in social media conversations & networks. Another, arguably the most potent marketing ingredient in the brand's social soup, is about visibility & distribution --- the active optimization & management of brand content - apps, videos, coupons, widgets, services, links! - distributed thru a socially targeted lens. All of this can and should be informed by the final of the four legged program, targeted "social listening".

The social content distribution piece (can you say "search + social") is where the true sustainable scale for awareness, engagement, traffic, referral, purchase and usage can be attained within an integrated social marketing program.

Focusing exclusively on WOM, sentiment measurement (a snake-oil fallacy...) and influence leaves 3/4 of your potential social marketing program non-activated... and it's an uncool, myopic shame to leave these rich monetizable opportunities on the table.

Jeanette Okwu from eblizz, inc., July 21, 2009 at 5:51 p.m.

thank for the recommendations. i think these days it is really hard to find the right info on social and viral marketing. although, we all are learning by doing in this space at the moment, one thing is for sure, at least for me - Tupperware parties don't work in the internet.