Over the past year Capgemini Consulting has been engaging in more discussions with clients on the use and business impact of social media.  With the immense popularity of Facebook, Twitter and other types of online communities, we have noticed a clear separation between companies that effectively use these communities and those that do not.  Today’s customers are more sophisticated, and sceptical of information presented and claims made through traditional marketing channels, making marketing and customer service more complicated.  One of the impacts has been a rise in Influencer Marketing demonstrating an importance for companies to identify and serve their key ‘influencers’ more effectively.

Influencing behaviour is no simple matter.  The challenge for companies is to help inform and shape the information that is available, be responsive to what is being said and be creative in influencing the customer decision making process. 

The Customer

Social media has changed the way we search for and purchase goods and services.

Internet companies such as Yelp, Urbanspoon , Citysearch, and TripAdvisor have enabled us all to be influencers.  Customers regularly make use of these communities to   learn, rate, and share our experiences with an organisation, brand, or product providing a rich context for others to make decisions.  Yelp has done a terrific job employing a user-generated content model, similar to that of YouTube, which allows users to completely express their opinions about any aspect of a city.  Yelp’s co-founder and CEO Jeremy Stoppelman recently shared his view that , “There’s an information shortage when it comes to local businesses. We’re a place for a conversation between the prospective customer and the business owner.”  Many  Yelpers are prolific and have created their own set of followers.

The High Influencers

Not all influencers are equal.  The role of business, political, and social leaders was clearly demonstrated in the last presidential election in the United States.   Business Week got it right when they observed that “Unlike in any other Presidential election, the electorate could harness a panoply of social media tools—blogs, social networks, photo and video sharing sites—to broadcast to the world their thoughts about the candidates and their experiences of the electoral process.” While in some ways it was a grass roots movement there were also some high profile people like actors, talk show hosts, and musicians  that took positions on candidates and topics.  The way this unfolded was new, electronic, continual, and viral.  It connected people, created energy, and built momentum as the election cycle progressed.  It also demonstrated that some participants have more importance and influence than others. 

While not as dramatic and broad in terms of media consumption we see similar developments with companies that take an alternative approach to balancing traditional marketing levers.  One company that has successfully relied on public relations and celebrity influence is Spanx.  In the company’s earliest days founder Sara Blakely led in-store rallies with sales associates and cold called newspapers, magazines, and TV stations to get the buzz about Spanx in the media.  This word of mouth marketing landed Spanx on Oprah’s coveted Favourites Things List in 2000 and a must have for celebrities on Hollywood’s red carpet.  Spanx’s influencer market was growing so rapidly, that the company decided to expand their product line by introducing ASSETS, a brand for Target.    You can watch just how quickly the word of mouth spread about Spanx on this clip.

Influencing Customers – The Opportunities and Risks

The proliferation of blogging, online channels and social media outlets present opportunities and risks for businesses.  If used effectively they can strengthen a brand, a product’s competitive position, and generate demand.  A good example is a US based low cost carrier, Southwest Airlines, which has taken full advantage of social media outlets by integrating them into their marketing and online presence.

The new rules of marketing focus on interaction between customers and businesses.  Many mainstream companies that grew up using traditional channels have adopted new channels to engage and motivate their influencers.

Companies that embrace the new wave of “social influence marketing” have realised that customers want and need to be engaged in the marketing process. These companies are combining traditional and new media marketing strategies to engage customers. For example, Wheat Thins “the Crunch is Calling” campaign integrated new digital networks with their traditional marketing style of television advertisements.  Wheat Thins monitored Twitter for references to their company and would visit the Tweeters live at their residences with boxes of Wheat Thins, all while filming commercials that aired on television.

Similar to Wheat Thins, Old Spice launched a viral marketing campaign in which it utilised a variety of social media platforms and tactics. Old Spice invited social-media users to submit questions to the Old Spice spokesman played by Isaiah Mustafa.  The company responded to these Twitter question with personalised YouTube videos featuring Isaish Mustafa.  This marketing campaign makes full use of their digital network.  It is interactive and personalised to customers and potential customers, inspires thousands of Twitter messages to the Old Spice spokesman, and makes use of various social media platforms. 

Influence Based Marketing -What it means

Traditional marketing was centred around push marketing.  Now, companies must engage and motivate customers by interacting with them, demonstrating the value of their products and services, and creating advocates that are outside of the corporate structure.    To be successful in influencer based marketing, organisations must constantly consider the dialogue they are having with their customers, the value that they bring to the table, and the importance of what people say and how they feel about their business.

The importance and relevance of influence based marketing will continue to grow.  It will shape how companies engage with customers, market products and services and deliver customer service. How is your company responding to influence marketing?