Recession an opportunity for social media? Or maybe not
A series of reports are out about social media, marketers and the recession. One relays on the received wisdom that the downturn is an opportunity for social media practitioners. But, by looking at how marketers actually feel about the whole sector, two others point to a different conclusion.
First of all, as reported by the Future Lab, the UK’s Chartered Institute of Marketing has published its list of recession winners and losers.
Winners: Online, email (in what sense?), CRM and PR….in other words the more direct, and also cheaper stuff.
Losers: Not surprisingly, advertising (I guess this means traditional print and broadcast), sponsorship and ‘internal marketing’ (?). So the big budget items.
Rationally that makes sense as a client left with say £100k / $150k in the marketing pot won’t be able to do a great deal in consumer advertising, but in PR or social media terms that still buys you a decent campaign. Plus, as we all know, necessity is the mother of invention so it’s also a good opportunity to recalibrate your marketing efforts.
But we’re not always rational, and I often wonder whether the opposite is true. When times are tough there’s a natural instinct to stick with what we know and retreat inside our shells, even though it’s arguably exactly the time to innovate. A lot of marketing directors learned their craft pre web 2.0 (or even web 1.0) and more than a few see everything through a traditional advertising prism:
So PR is free advertising, a way to get journalists to write about your ad messages. Digital campaigns are an extension of your offline advertising and so on.
Why do otherwise intelligent and successful individuals think like this? Two other reports point to some answers. One is that it’s outside of the comfort zone. The second is that the value is as yet not really understood.
55% of CMOs ‘uninterested’ in using social media
Another Future Lab article is headlined “marketers face steep web 2.0 learning curve.” According to the marketing executives networking group, 67% of marketers consider themselves social media beginners, with many seeing it “akin to the wild west.”
That could well be why, according to a survey by Epsilon, 55% of ‘top brand’ chief marketing officers are not interested in incorporating social media strategies in their marketing campaigns, even though 27% said word of mouth is the one thing they’d like to do more of.
Tellingly, Epsilon’s Chief Marketing officer (ie the guy who ultimately was responsible for coughing up the money for this study), said, “These sites narrowly appeal to college and high school students, providing a challenge as far as measuring results and yielding a limited amount of actionable data.”
Ouch. “College and High School students.” As anyone who is even remotely acquainted with this space knows, that’s a long way from the truth. But it shows again that once you get outside the echo chamber, the use of social media is by no means gospel, and why we still have a way to go in terms of selling the need and highlighting the benefits.
Image – Roger Smith
Update (3 December) – A must read is this piece from Ad Age, “a funny thing happened when I cut my ad spend – nothing.”
Key quote: “The problem is many companies still operate their marketing departments according to the old thinking of persuasion metrics and an ‘us them’ landscape. They’re blind to the behavioral shifts transforming customers right in front of their eyes.
“As a result, consumers drift further away, and we continue to see brand measures decay and crack. It’s those enterprises that can’t see the brand bubble blowing up around them.”
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I hear you, Dirk.
Unfortunately, I often have the same problem. As I said before, it is easily explained with general psychological effects… most of which are enhanced in “tough times”.
Still, I believe that with enough case studies to prove our point, the establishment of fear to “miss the boat the competitor is in” and some other techniques, we may still win the day.
Not wite the purpose to make a ton of moolah for our agancies, but with the client’s best interest in mind.
Thank you Gavin and Markus for the comments. I agree Markus that it is measurable, but unfortunately it doesn’t appear that way for a lot of clients.
I had first hand experience of the tendency to retreat in tough times the other month when a client had £100k ($150k) left in the budget and was talking about putting it into print ads before Christmas.
OK, so I had a vested interest here, but it seemed like madness when (as we pointed out to them) a combination of digital, media relations and brand experiences would work much better than to take several pages in consumer mags.
We sent a proposal, followed up with proof points and even offered to go head to head against the ad agency in a pitch (ie for us both to put our money where our mouths is).
We never got a definitive ‘no’, but the conversation sort of just petered out, which told me that they went with what they were familiar with.
Incidentally my post was a follow-on to something I wrote the other month, where I looked at the three barriers (in my experience) which prevent clients doing more social media work: “better the devil you know”, “it’s not for me” and “all sounds a bit complicated”:
http://bit.ly/XF5o
Excellent points Dirk, Kate and Ben.
However, I disagree with Ben on one crucial point: SM is not wildly unproven. I do recommendation and viral marketing and am able to both track eyeballs and, to a certain extent, even the actual generation of revenue i am certainly able to track how much people talk about a brand/ product online, have a good idea how much they talk offline (via Buzz instruments) and also know WHAT they talk about the brands.
As for Facebook and Twitter having no “advertising”: That is the entire point! Nobody wants to be advertised to. Twitter, Facebook, YouTube and Co., however, offer the opportunity to have an actual dialogue with the consumer – or at least give consumers something to talk about and spread easily among themselves.
Learning:
Spend those ad dollars, use scoial platforms, viral techniques and (micro-)blogging to start actual, trackable conversations and sales… and measure actual ROI, not some useless CpX indicator.
Unfortunately, for various psychological reasons (“certainty bias”, “gambling paradoxon” and several others come to mind), it is really hard to sell the “new and different” to people who are scared.
A year or so ago, I sat in a meeting with the regional marketing directors from a large FMCG brand. The head of digital from a major agency stood up and stated “the thing about digital is that you can’t measure it”.
I was shocked. But as I looked around the room I could see everyone nodding in agreement.
Obviously it was decided that the following year’s efforts would focus on traditional approaches to brand building and advertising.
It’s not just that people won’t experiment or learn – they take advice from those that they should be able to trust. Sometimes we need to question even that base level of trust.
I think those are good points Ben.
Within Cow I’m often asked to go and give a social media presentation to brand managers within various FMCG clients.
Often (not always) it works like this: I turn up, show them a few interesting sites and give a presentation, get some questions, leave…and they carry on doing pretty much what they’ve done before.
I’m like the guy who turns up with some whizz bang invention, gets a lot of interest, but with the attitude of ‘good stuff, we’re not ready for that yet.’
And incidentally, this is often from brand managers who are in their 20s and so are very comfortable with social networks when it comes to their personal lives.
Excellent post. Kate touches on another issue — in trying times CMOs, like everyone else, have an instinct to retreat to what they know works. Social media is still wildly unproven.
SM gets huge buzz in the tech press and from the people who use it, but it still — admit it — is useless in driving results. Facebook ads have opened up to CPC, vs. the inefficient CPM, but the responses are so low in our experience it only justifies a fraction of a client’s online budget. And Twitter, my personal favorite SM media, has no advertising to speak of.
I actually discussed this issues last night with a client and they noted they *knew* SM was important and a wave of the future, but they were watching it — not moving into it — because it had to be integrated into a larger organizational strategy. Starting SM effectively means *maintaining* it — setting up a Scott Monty of Ford etc. Smart marketers realize that is a huge commitment, one that requires feedback systems to division leaders to resolve customer complaints, constant monitoring, privacy issues — really, if done well, setting up an entire new business operating system.
In a down economy, that’s a lot to bite off for any manager. The temptation is to retrench only to the media that gives proven results.
Social media has a long ways to go to justifying its existence. I personally believe it is a better CRM-type customer management tool. And like the CRM wave of the 1990s, to do it right takes a huge amount of strategy and process beyond just a campaign or piece of software.
Cheers.
thanks Kate, yes I’ve similarly been in the situation of “you must get a piece in the Mail on Sunday…that’s what the client’s mum reads.”
Unfortunately I think some of us have developed a bit of tunnel vision when it comes to social media and forget that it’s by no means accepted that you have to do this right now, and I guess the onus falls on us to show why it is
Nice one Dirk. Your story about the Epsilon CMO reminds me of that scenario (which I still come across) whereby the agency has to run a TV ad is some completely inappropriate environment just so the CMO sees it.
Wouldn’t it be great if marketers hitched up their trousers and waded into the surging river. OK bad metaphor but you know what I mean.
There’s a great article I read in Harvard Business Review a while back called ‘smart people find it hard to learn’ which is about the fear of not knowing and how it prevents learning. Case in point.