Building a Business Case

for Social Media

Jason Sem

HBS Chapter of the Harvard Club of Minnesota

May 17, 2011

Agenda• Perspective• Consumer Decision Journey• Social Advocates• Planning for Social• Where We’re Headed• Questions/Answers

It’s not so much about TECHNOLOGY

Social Media Is About PEOPLE

+ +

Years Ago We Were Pretty Restricted To The Media We

Could Consume

Old Consumer Decision Cycle

Then: The Funnel Metaphor

• For a long time marketers assumed that consumers started with a large number of potential brands in mind and methodically winnowed their choices until they would decide which one to buy. After purchase, their relationship with the brand typically focused on the use of the product or service itself.

Source: Harvard Business Review 12/10

Today We Have Thousands of Different Media at Our

Disposal

New Consumer Journey

Now: Consumer Decision Journey

• New research shows that rather than systematically narrowing their choices, consumers add and subtract brands from a group under consideration during an extended evaluation phase. After purchase, they often enter into an open ended relationship with the brand, sharing their experience with it online.

Source: Harvard Business Review 12/10

New Consumer Decision Cycle

• Consider & Buy - Marketers often overemphasize the “consider” and “buy” stages of the journey, allocating more resources than they should to building awareness through advertising and encouraging purchase with retail promotions.

• Evaluate & Advocate - New media make the “evaluate” and “advocate” stages increasingly relevant. Marketing investments that help consumers navigate the evaluation process and then spread positive word of mouth about the brands they choose can be as important as building awareness and driving purchase.

Source: Harvard Business Review 12/10

New Consumer Decision Cycle

Source: Harvard Business Review 12/10

Advocates: Why They’re Important

•14% trust online ads (Forrester)•94% trust Word of Mouth (Forrester)•Advocates will thrive in your community•When advocates talk, brands grow•Average network = 190 followers•1.000 advocates=190K direct reach

•40% consumers recommend brands (ComScore)•60% advocates believe that good brands are worth talking about•67% of US economy impacted by Word of Mouth (Mc Kinsey & Co)•70% conversations include recommendation (Keller Fay)•85% tried to contact supplier before complaining (Nielsen)•90% of advocates write something positive about purchase experience

VS

Shifting Nature of Consumer Engagement

How Do You Plan for Social Media

80% of success is getting your organization ready --only 20% is about the

technologies

Social Strategist: • Responsible for the overall

program, including ROI• There may be multiple

strategists at each spoke

Community Manager: • Customer facing role

trusted by customers• Companies may have

dozens of community managers

15

Staffing for Social

Organizational Model

• Reach• Frequency & traffic• Influence• Conversations &

transactions• Sentiment• Customer service

resolution

Guidelines and Policies

17

Intel updates it’s Social Media policy regularly and offers tips and

pragmatic rules of engagement such as “Be transparent,” “Be

judicious,” and “Write what you know.”

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Web Analytics Social Analytics

Reporting

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To be successful using social

technologies, companies must

first prepare and align internal

roles, processes, and

policies with their business

objectives and customer’s

decision points. Social

business is a profound change that impacts all departments

in the organization.

Evolution of Social Business

Social Customer

Social Brand

Social Business

1 2 3

• Technology innovation gave customers a voice

• The are influential• Amplified voice

across social media• Google indexing

critical conversations

• Social customers are trusting amongst their peers

• Companies and brands join Twitter & Facebook

• Engage with the social customer

• Social media teams are formed

• Small budgets are allocated to social media engagement and community building

• Humanizing business operations

• Organizational models are formed to include social

• Organization silos are torn down between internal teams

• Social becomes an essential attribute of organizational culture

Jason Semjason@jbsem.com

twitter: @jbsem

Q&A

Find this

presentation at:

www.jbsem.com/blog