The Personal CPM: Quirky Idea or Future Marketing Reality?

Former Forrester analyst and social media visionary Charlene Li has added fuel to a topical flame dubbed the "Personal CPM." She hypothesizes that marketers will bid for access to personal social networking profiles with greater reach and influence among their peers. Inherent in this discussion is whether these individuals share in the windfall of this influence. I am participating in a panel on the topic this afternoon at OMMA Social in San Francisco so I thought I'd put a few ideas out there and see if I can crowdsource an analysis.

First, this is not a new topic, it has been tackled by other industries and wrestled by other thought leaders under different monikers and in alternate contexts. Social Media shares DNA with sister discipline Word of Mouth. As a former board member of the Word of Mouth Marketing Association (WOMMA) and student of the burgeoning Social Media industry, I've witnessed both industries obsess over "influencer methodologies."

From this debate, messiahs have been created, definitive tomes written and disciples deputized. Two dominant "religions" seem to have risen from the fertile influencer landscape even before the context of social networking evolved the conversation: The Influentials vs. The Everyday Evangelists. Malcolm Gladwell's breakthrough work The Tipping Point was the Old Testament to Charlene Li's New Testament Groundswell.



His research located those "maven" consumers, the cool kids, whose fashion, music and consumerism were the seeds of all trends. Tipping Point gave rise to a legion of "cool hunters" that splintered into a more scientific approach outlined in Keller/Berry's book The Influentials, with a descriptor that says it all: "One American in ten tells the other nine how to vote, where to eat and what to buy."

The Everyday Evangelists argue that the search for alphas, mavens, sneezers and the like is a fool's pursuit. Companies like Bzz Agent have led this splinter faction, assembling legions of hand-raising, would-be evangelists to try stuff, talk about the stuff that they like, and report on the conversations.

They make no claims that these people are screened for influence, size of network, or persuasive personality traits. They have, however, placed a line in the sand around the idea of a CPC, or cost per conversation. Based on some nifty math and established media metrics, they've established a de facto standard of $.50 per conversation. In a performance-based world, would you give two quarters for a conversation about your brand?

These models, of course, were conceived BF (Before Facebook). If Google established the common practices and pricing models of performance advertising, I argue Facebook will be the battleground of the Personal CPM holy war. On one side, marketers await, anxious to "buy" social influence at the human being and personal profile level. Lining up against them will be the privacy zealots and marketing skeptics, defending the sanctity of our profiles and the actions within our social networks. Somewhere in the middle will be consumers with a growing sense of their marketability and looking for a little something, you know, for effort.

Mark Zuckerberg once called Facebook "Word of Mouth on Steroids" and his Beacon advertising program planted the philosophical seeds for the idea of tapping purchase influence within social networks. Beacon may have lost the battle, but Facebook will win the war. Out of the ashes have risen three new weapons of mass influence: Social Ads, Pages and Connect.

How can advertisers tap into the social graph and "Personal CPM" to have greater impact in social networks? Should they? I'd love any thoughts.

5 comments about "The Personal CPM: Quirky Idea or Future Marketing Reality? ".
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  1. Suzanne Lainson from SportsTrust, January 26, 2009 at 7:20 a.m.

    This article is a helpful overview on the subject.

    My Facebook network is ever expanding (most people I add come from the rotating "People You May Know" list that Facebook offers me), but it is carefully selected. I actually read everything that happens with all my friends (via the Live Feed) so I want my list to be manageable and made up of people I'm genuinely interested in. There's a logical connection between me and everyone I have added. I don't add people randomly.

    MySpace (particularly as it relates to music marketing, which is why I have been there) became such a numbers game and has become so overwhelmed by spam that people have tuned out many of the messages/comments/bulletins.

    I'm expecting Twitter to head down the same path. I've been pretty selective about who I follow and who I add there, but even with relatively low numbers of people I follow and who follow me, it's hard to monitor everything and I don't really try. I'm more likely to use search to find something of interest.

    I think if you want to use a social medium to influence people, you have to keep it a somewhat exclusive one. Once it becomes a mass market, then people tend to tune it out and move on to the next tool.

  2. Michael Hanley from Ball State University, January 27, 2009 at 11:06 a.m.

    Excellent insight into a subject that college students have talked about since BF and now WM (with mobile). Students see value in their Personal CPM and are more than willing to "negotiate" with marketers as to the amount. My own mobile research has found that students will readily accept 25 cents to 50 cents for access to them on their cell phones. Not a bad acquistion cost for an engaged consumer.

  3. Matt Moog, January 27, 2009 at 2:09 p.m.

    Jamie - great article. I do wonder what the impact on credibility and trust would be if it became common practice for influential consumers to become paid spokespeople for brands. This seems ethically troubling. The term "Personal CPM" seems to imply that access to a person's own personal social graph is for sale. While being paid to reach an audience is not new and not troubling by itself it is the potential of being asked to endorse a specific product to your network of friends seems like a short lived concept because the very trust you have earned would quickly disspate. Approaches and business models will need to emerge that disconnect a direct payment from the brand from the success of the influencer. For example Walter Mosberg is paid by the Wall Street Journal and the paper in turn solicits advertising from companies about which he offers his opinion. But there is not a direct payment from the advertiser to the influencer. It seems to me the same type of arms length relationship will need to exist with the influencers you write about.

  4. Jason Heller from AGILITi, January 27, 2009 at 3:41 p.m.

    I have found the concept of personal CPM interesting since I first heard it, but one of the issues is tracking and crediting of influence past the first node of the social graph. It has been proven both formally and informally, that as the size of your social network grows, the value of your "relationships" (and possibly influence) decreases. Think about your own as a mini case study. I now have over 1,000 "friends on Facebook and around the same on Twitter. I can;t keep up anymore, and may of my contacts may be the same.

    I actually wrote about this in the context of the Dunbar Number recently. I don;t normally like linking to my blog posts in comments, but this is a very relevant one so don;t hold it against me please :)

  5. David Honig, January 28, 2009 at 10:44 a.m.

    Jamie, Great seeing you in SanFran. Enjoyed this piece.
    Common thought in the industry is that there is a small group of brand evangelists that can influence your brand. I believe (and am not alone) that in today's fragmented mass-customized world that every small group of friends have their own brand evangelists and that most of their purchase recommendations and brand conversations happen in these groups. It is quite simple: people tend to communicate via word of mouth and make similar [purchases] with those in their social groups. In this sense, brand communication is constantly occurring, and leveraging existing customers can represent a strong opportunity for brand advertisers. The hard part is identifying and communicating to these influential groups or communication circles at scale. The starting point that matters is the online Data the brand has on their customers. Start there, build audience that matters and scale from there vs. Carpet bombing Social Nets with a playful App thats virally successful but lacks proper metrics, lifetime value and in many cases, the right audience. The point of Data entry is what matters. Trusted Data entry is scalable. I am sure to it that all brands believe their data is trusted. Now they need to unlock it and pay dividends for the brand, and give the right experience to their customers and their neighbors.
    However, we should be leery of overly intrusive technologies and advertising. This is a natural process that works better when people share genuine, common interests. No one really likes to feel like they are being evangelized. The point of Data entry is what matters.

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