Trevor Booth, a Consultant in our Marketing, Sales and Service practice provides his view on the impact of using social media to engage with customers.
It has recently been reported that social media , undoubtedly one of the buzzwords of the last few years has recently overtaken personal email to become the world’s fourth most popular online sector. Not only are more people using the many types of social media available, but, a recently published Nielsen study reports that people are spending longer on social networks than ever before. Seemingly therefore everybody is talking about it and almost everybody (including companies) is participating. Recent examples such as Nestle raise the question however of how can companies avoid the negative consequences when social media goes wrong?

Two-thirds of the world’s internet population visit a social network or blogging site and the sector now accounts for almost 10% of all internet time.

For companies, communicating with customers through social media offers new challenges and opportunities which more traditional marketing methods don’t offer.

  • Social media involves both consumption and supply of information, where as traditional marketing offers consumption only where the messages communicated are easily controlled.
  • Today, marketers are not only faced with the challenge of talking to customers in a different way, they also have no control over the most powerful form of marketing, word of mouth.
  • To be successful promotions through social networks will take time and they will need to engage in open two way conversation with consumers (something that companies really tend to struggle with!)

Statistics suggest this is the way of the future for communicating with customers but how do companies avoid alienating important customers?

Bad news travels fast in this social media age and the potential damage to a brand is clear from the recent turmoil surrounding BP. Marketing communications and campaigns in the future will need to align very closely with PR activities. Companies will need to respond decisively to “bad press” or they will risk both brand and financial consequences.

If you take the example from Johnson & Johnson brand, Motrin decided it would launch a social media campaign “Motrin Moms” for the International Baby Wearing Week by producing a youtube video . The ad was targeted at mothers and talked about the carrying an infant in a sling being fashionable. It was intended to show empathy for the young mum but instead it created a backlash on twitter with thousands of Mums tweeting negatively about babies being made into fashion statements. Johnson & Johnson responded quickly by immediately posting an apology on the front page of the Motrin website. The important thing to take away from this is understand who your audience is especially when using social media as the potential consequences are swift.

The impact of social media extends beyond marketing messages and in fact covers everything the organisation does from the suppliers it works with to the way it treats its employees.

It is therefore important to ensure that the organisation offers consistent customer experiences and responds to customer service issues in the right way rather than simply paying lip service to a PR line.

Why is it so important now? Because as I have mentioned earlier, news travels fast, and, companies no longer have control of the conversations taking place. An example where the consequences were particularly painful was United Airlines who refused to compensate $3,500 to a passengers claim for a guitar that was broken in transit. The passenger contacted United Airlines for compensation and after nine months of United doing nothing he wrote a song named “United Breaks Guitars” The youtube video portrayed the negative experiences he had with the airline with lyrics like “You broke it, you should fix it / You’re liable, just admit it”. It has received over 9 million views and according to The Times, within four days of the song going online, the rapid gathering of bad PR caused United Airlines’ stock price to suffer a plunge of 10%, costing shareholders $180 million. This is a harsh lesson for ignoring a customer complaint.

To maximise the marketing and PR benefits through social media companies must learn to communicate with a different mind set. Last year, insurance comparison site Compare the Market launched a social media campaign called “Compare the Meerkat Campaign” where a memorable and funny ad was launched on British TV. To compliment the campaign the company set up a Facebook page which received over 320,000 fans, a youtube video with 80,000 views and on twitter where 10,000 fans were following the campaigns tweets. Additionally the campaign was also followed from Digg, StumbleUpon, Delicious, and Flickr. Its success in the first 3 days resulted in over three quarters of the monthly insurance quotes target being achieved. The number of insurance quotes was up by 90% on the same period year on year.

The traditional push model of marketing communications is not relevant for social media. Instead companies need to engage in open two way conversation that takes time and focuses on building trust and loyalty. By building a trusted following, an organisation will then have the opportunity to offer tailored products and services that offer both added value for the customer and new sales and product/service opportunities for the organisation.

In the increasingly transparent world we live in, seemingly the best way to avoid social media disasters such as the ones I have mentioned is to operate in customer focused, socially responsible way and to respond to social media comments in an appropriate and timely manner. Trevor Booth.