May 2012 Archives
Barely six days ago, Oracle announced that it was buying Vitrue for $300 million. Tonight rumors are spreading (thanks to Peter Kafka of AllthingsD) that Buddy Media is going to be picked up by Salesforce for $800 million. How time flies and a category of software that didn't exist a few years ago (yes, I remember being pitched by them all when they had fewer than five employees each) is now a billion dollar plus one. But where do we go from here and why are these companies so valuable? Here are a few thoughts.
- If you're able to put aside the noise around the Facebook IPO and what certain auto manufacturers may say, you'll realize that social media marketing is here to stay on a mass scale. Every day it only gets bigger and bigger and CEOs of Fortune 100 companies are recognizing this. Both the Unilever and the P&G CEOs talked about social media during their recent earnings calls. Just look at time spent online versus dollar spends or how companies like Ford, American Express and Nike (not to mention us at PepsiCo) are marketing through social media to see its importance. Social Suites which make it really easy to publish engaging experiences on the social platforms are valuable and for companies manage the global/local tension of social media, these suites are going matter more.
- Unfortunately, the links between a company's CRM database and its social media fan base has always been broken. In fact, they've been treated as two separate, distinct and disjointed CRM marketing efforts. As a result, without realizing it, many brands have developed competing CRM efforts. You harness your CRM database for effective email marketing in a certain way and then with a separate department you reach your Facebook, Twitter and YouTube consumers not knowing if there's any overlap or which is more effective for specific types of communication. Any company that can help solve this problem is going to win. That's why Oracle+Vitrue makes sense and similarly Salesforce+Buddy Media (if the rumors are true) do as well. CRM Databases have always been extremely valuable and when you tie them in with social media engagement, they become so much more so. All of sudden you can understand your customers not just by what they purchase and what marketing you throw at them but also by their loyalty and advocacy towards the brand.
- Just as important is the ability to execute real-time marketing effectively. Last summer, when I introduced a Real-Time Marketing framework at John Battle's Conversation Marketing Summit, I fully knew that not all the pieces were in place. It was indeed hard to go from strategy to execution in a matter of minutes or seconds as I proposed was the future of marketing. Companies that can help brands do that are going to win. Social Suites play a critical role in that, not necessarily because they do something that no one else can do (you can custom build a lot of the functionality) but because they make it fool proof and quicker to deploy. Building for engagement and not just on Facebook but elsewhere across the web and on a global scale gets really easy with these social suites. And don't forget the power of this form of marketing when it becomes hyper local and mobile specific. If I want to roll out a Facebook marketing campaign that's unique for each of Nielsen's 210 DMAs, the only way I can do that quickly is with a social suite.
- But wait, there's more to this than meets the eye. Let's take Salesforce as an example for a moment. They already own Radian6 which means they have a powerful tool through which brands can gather real-time insights and engage in Real-Time Response. With a social suite platform like Buddy Media, they would now be able to participate in Real-Time Engagement as well. By harnessing the Brighter Option Facebook ad marketplace solution (recently bought by Buddy Media), those brands can juice up their social media engagement with paid digital media in real-time. By tying this all into their Salesforce CRM databases, the brands can get a real-time end to end view of their customers -understanding their brand preference, intent to purchase, actual purchases, loyalty and lifetime value. Not to mention, they can also better understand which marketing tactics worked best. Powerful stuff (as long as they figure out the potential privacy minefields).
- Last but not the least, Social Suites have evolved into a lot more than Facebook tab canvases which is why they're so valuable. Many of these players have cross platform solutions that allow you to create once and deploy in multiple places in ways that are appropriate for each social network. Furthermore, they let you measure the effectiveness of a particular campaign, piece of content or engagement activity more holistically and in a more benchmarked fashion. They also institute workflow that reduce business liability with legal checks. And with globalization capability they smoothen the roll out of social in countries where the brand may not have a large digital team. That's all really valuable for brands.
In my opinion, the potential acquisitions of these social suite players by the major CRM companies represent the final nail in the coffin of social media. No more is it something separate, disconnected, cute and experimental. It has just moved to the heart of all marketing efforts and the stock price movements of Facebook will not change that. Social Media Marketing is on scale and needs to be at the heart of your marketing efforts right now.
I should have drawn attention to this book many moons ago when it was published last year (especially since I was interviewed for it). It's Clark Kokich's Do or Die. It's sharp, insightful and thoroughly engaging. Most important of all and unlike many books, it has a differentiated point of view on marketing and the evolution of brands. It's case study driven and makes a compelling argument for why traditional advertising and the historically safe forms of marketing aren't enough to succeed in today's world. You literally have to do versus just say. Not surprisingly, I'm a big believer in that philosophy and talked about it at the time of the Pepsi Pulse launch.
Once you're done reading Do or Die, a very different book to pick up is Rex Briggs's SIRFs-Up which explains how measurement and marketing effectiveness should really work. I've always been impressed by Rex's thinking and his contributions to our industry. He won't let you down with this book. Covering spending levels, medix mix, forecasted sales and performance metrics it'll help you answer the tough questions that you may get from your CEO or CFO. I was also interviewed by Rex for SIRFs-Up.
Today Facebook is urging its US members (roughly 161 million of them) to add their donor status to their Facebook profiles according to the NY Times. There are around 7,000 patients waiting organ transplants. In addition to encouraging Facebook members to add their donor status, the company is also encouraging everyone to list their birth dates and schools to further create peer pressure to further push people to add their names to the rolls of registered organ donors.
I couldn't be more impressed with the initiative. It's been done on a smaller scale by other companies on the platform but Facebook is scaling it up. It's an imaginative idea and something only Facebook can do in a uniquely Facebook way on mass scale. Uniquely Facebook in how the social networking site is depending upon peer influence to spur action among millions of people. Best of all it takes very little effort by anyone for this to happen. More companies should think this way. It's a lot easier (and less expensive) to make a change, to positively impact the world around you than you may often realize.
As a tiny show of support, for the first 10 people that do this and tweet or DM me a pic of their Facebook profiles showing that they've done so, I'm going to send a free copy of Social Media Marketing Dummies to them (second edition which just came out)