On Smartcompany.com.au’s “Lunch With an Entrepreneur” series, Amanda Gome interviewed Ogilvy 360 Digital Influence’s Rohit Bhargava. Rohit talked about social networking, big mistakes businesses have made and his observations from his recent trip to Australia. You can listen to his podcast on Smartcompany.com.au or read the transcript below.
Where is Australia at on the social media curve?
Australia is similar to a lot of countries: brands are very, very interested in starting to engage and experiment with social media. They want to find ways of proving the value of that to the people within their organisation.
What’s the biggest hurdle they’re having to overcome? Is it a waste of time or resources?
There’s a lot of fear around the amount of resource time, so when you think in terms of return on investment, the investment in social media is very often the time, not so much the budget. So that’s a very real cost. But the other thing is there is the fear of negativity that perhaps people might be negative about your brand or your product. So that can be a barrier sometimes.
What are some other myths or mistakes that businesses are making in this area?
One of the biggest mistakes that businesses make is that they focus too much on the fear of negativity. They try something, they launch something and they don’t necessarily focus on an effective promotional strategy. Instead there’s actually a lot of silence because nobody knows that this exists, nobody engages and they look at that and they feel let down because you’ve spent this time and this excitement to launch something and it doesn’t necessarily turn out to be this viral success that everybody wants. It stalls initiatives internally sometimes because it’s very difficult to prove the value if you’ve launched something and done that effort and you really haven’t anything to show for it.
And what should you be doing in that situation?
I think you need to focus on the value exchange. Which is, why would somebody care about something you’re putting out there? Is it self-serving or does it actually solve some sort of need or offer something back to the people who might be reading or the people you want to engage? And a lot of times the mistakes that brands make with social media can be solved by asking that simple question upfront.
Okay, so you’ve got a lot of large companies at the moment setting up social networking sites where they’re becoming sort of mini publishers. What should they do if people are not coming?
Be more strategic about where you are. So just because Twitter or Facebook are in the news all the time doesn’t necessarily mean you need to be there. It really does depend on your business and where your audience is and what you’re going to use that tool for. So the first thing is don’t be tempted by the brightest, shiniest tool on the horizon. Actually think about what makes the most sense for you brand and focus on that first instead of just reacting to where you think people are.
Can you give us an example of a company that has changed position like that, made some mistakes and then got it right?
Well, I think a legendary example in social media is Dell.
In the US market, there are a number of these brands who’ve gone from starting up in a position of negativity and turning that into a positive experience. Of course Dell is one of them. Comcast is another one that’s done that quite effectively.
Take us through that strategy.
Comcast is a cable provider providing internet services and television services for people’s homes. There’s a lot of negativity in that industry, in the US at least, because people are very frustrated with their service. Sometimes if you call someone to come out and fix it, they don’t necessarily come within the time frame in which they should and there are all sorts of issues there.
So there was a gentleman who works for their customer service team who started using Twitter to answer customer feedback directly and to solve customer service issues. That turned into a very, very effective use of the platform as a way of enabling people to get customer service, where in other situations they might have been lacking that. And that was a very effective use for them of turning their customer service reputation around.
Where does the social networking function sit in companies? In marketing? In PR? In sales lead generation? Are you seeing companies restructure as a result of social networking?
Yes, some of them are. I think that there is no single formula for where social media sits within an organisation, so the Comcast example is one where social media was driven through customer service, the Dell example was one where it was driven through marketing and often it can be driven by PR which has been our example because it’s such a directly relatable effort to create content and drive people to it and the whole influencer engagement.
To some degree that’s what PR always has been and so there really is no rhyme or reason to where it starts from. The real challenge for a brand is to embrace where it is beginning to start from within their company. Because for a lot of these brands, it’s already happening within their company and the challenge is to find it and support it.
So you mean just an operations person might have already started it and it mightn’t be incorporated into any brand yet?
Yes. We do a lot of social media work with Intel and that’s a good example because a lot of their innovation comes from their technical people and these are not necessarily people that you would put out there and say they speak for the entire Intel brand, but in their area, they’re recognised as experts and they have something very valuable to contribute to the online conversation. So we’ve helped Intel to do is find a way for those people to be part of the communities that matter so that they can help position the company as the technology leader and all of that kind of brand associations that Intel would want to have.
One of the most interesting things about this revolution is that a small business can be as effective at social marketing as large businesses because of the very low costs. Are you seeing that smaller businesses or larger businesses are taking the lead on it and what are you seeing smaller businesses doing?
I think that there are a lot of great examples of smaller business working in the niche that perhaps they’re focused on. So there may be local businesses, there’s quite a few of them in the US at least that use channels like Twitter or create Facebook fan pages to engage their local audiences who are really passionate about their brand or go to that destination very often.
I think that when it comes to larger brands it gets a little bit trickier because obviously their workforce is more distributed, they have more rules to try and adhere to or at least fit in to and integration becomes a bigger issue as well because they’re doing all of these other things from a marketing or PR or direct marketing or events point of view and the question often is, how do we integrate social media into these things and how do we scale it?
So a lot of what we spend our time doing when we’re working with clients is to, yes do pilot programs and those are always important, but also to help brands figure out how that scales and how that increases so that they can do more than just that one small thing that influences that one small group.
Where is social media heading? If you can talk about its sort of position now and where you see it going?
I think one of the big things that we’re starting to see is this idea that our digital identities are becoming inseparable from our real life identities and more and more each one of us is starting to create these profiles and live to some degree online and whether that is from our point of view, there’s a lot of choice involved.
So whether that extends all the way through to something like what I might do where I publish a blog and I write a book and have my photos online, through to somebody else who may just have a very simple profile online but be reading content, organising it, saving it for themselves to go back and see. All of these things point to this inseparable connection between the content and the part of ourselves that we save online and how we live our lives on an ongoing basis.
I think that as technology continues to improve and we start to always have access to that profile, it becomes an even deeper part of ourselves because we can save all the restaurants we love for example and access them on our mobile device. I think that’s really powerful when it comes to this archiving of our own experience that we can reassess and reuse.
Any other trends for business? What are the new employment opportunities that are going to come out? I mean we’ve already got people now specialising in or beginning to specialise in social media. Are there any other new positions and jobs that will come out of this and ways that companies will restructure?
From an individual job point of view, there are probably quite a few jobs that we have yet to see evolve. So back in the early days of the internet, late 90s-early 2000s, the job that was growing hugely was this idea of information architecture, where people were taking all of this information and all of these content pieces that were out because brands were at that time launching websites because it was very exciting to do.
And the job of information architecture and usability came about because there was so much content online that really sucked and they needed somebody to organise it to make it more usable and more user-friendly and useful.
Now I think that what’s happening with social media is that it’s come to this similar point where there’s so much excitement and brands are launching a lot of different things and a lot of them suck! Now it’s a question of what’s our role going to be where somebody comes in and helps these brands to optimise what they’re already doing and get more value out of it and organise it in such a way that it becomes useful for people.
And that traditionally starts off as an outsourced function and then might be brought in-house as the internal people understand the position?
You know,there’s no single formula for it. I’ve seen it happen both ways. Sometimes somebody within an organisation kind of emerges in that role and they become the custodian of some of these activities and they evolve into that. And sometimes companies recognise that need and go to an outside group. It can happen either way.
What do you see as the issues around online reputation with social media? Larger businesses work very hard to build their reputation. How hard do you need to monitor your online reputation?
One of the things that we’re finding with more and more brands is that anyone can say anything online. There was a great quote that somebody shared during the event I was at, the iMedia Summit earlier this week, where someone said that trying to take something off the internet is like trying to take pee out of a swimming pool, that it’s already out and there’s not really that much that you can do about it.
To me that was a really interesting way of describing this fact that people have their opinions and you can post them online and from a reputation point of view. If you’re a brand and you’re going to have influence over your own reputation, then really what that means is you need to be participating, so that you’re describing and you’re demonstrating what your brand stands for before somebody else defines it for you. It’s sort of like claiming your URL before somebody else registers it.
So can I just ask too, how do you overcome the reticence of people in your company who are older and are very suspicious?
Well I think there’s a couple of ways. One is numbers, because the numbers are on social media’s side in terms of importance of visibility for search, in terms of number of people that are starting to use it.
There’s a statistical argument to be made around what competitors are doing and how they may be doing more than what you’re doing at the moment. And then I think the other thing is that there’s a lot of interest here from brands in cracking this code and from senior executives’ point of view for a lot of them, there’s a lot of career value involved in being the one that cracks that code. And so not to kind of play on the ego too much but the idea is that if you can be the visionary person that sees the value of this and cracks that code for the company and does something that does stand out, it’s a very good career move. I think that is, to some degree, what’s driving some of the social media efforts out there.
Most people are now looking for products and services on the internet so they are going to come across your brand in that way. Is that the primary reason, really why you should be involved in social media? So you can meet them at that point and then take them on a journey?
The argument for using social media is very simple. The number one most effective form of marketing that most marketers already know is word-of-mouth. Everybody knows that, that getting a customer or someone to recommend your product or service is the most impactful way of marketing in terms of actually selling and getting a high conversion rate.
But the question was, how do you actually pay for that because it loses its authenticity, it’s not necessarily something that brands knew how to spend money on. And the way what we talk about social media very often is that people are sharing these opinions online and now you can listen to it, which you were never able to do before, and you can participate in it and spend money on it, which you were also never able to do before. So what social media allows you to do is scale and spend money on the number one, most impactful thing that you already know works in your marketing. So why wouldn’t you start to figure this out?
If this is working, if this starts to work and in some cases we are seeing it do so, what is that going to do to some of the older professions like research focus groups, what’s it going to do to mainstream media? What could you see the future there?
Well, I think those areas are already starting to evolve. If you look at research groups most already have an online component, or they are using online surveying, using social networks, in order to get people to share information and watch their behaviour. So research firms and research in general is getting much more sophisticated as a result of this.
I think on the media side, this two-way dialogue that we often hear about or talk about where people can communicate back and forth and share their points of view, is really becoming accelerated when you look at some of the largest media properties. So when you look at The New York Times or The International Herald Tribune or The Sydney Morning Herald, they’re all enabling this ability for people to share commenting back and forth and to take pieces of content out and spread them out to someone else, share them back and forth and all of this is unlocking this content. So content no longer just lives and is stuck in one location, it gets passed on around the world.
On the readers’ side, that is the truth but on the advertising side they have always depended on revenue from the advertisers. How do they need to change to incorporate more of the social networking word-of-mouth?
That’s a tough question for a lot of them because it does dramatically change the model that they have gotten used to.
One of the things we spend a lot of time talking about is the almighty unit of measurement brands have used for the longest time when it comes to traditional marketing as well as online marketing of impressions, are starting to become outdated. And the reason for that is first of all impressions aren’t created equal, and second of all impressions are often empty – they flash up but nobody notices them, you do your TV spot but it is on DVR and somebody fast-forwards through it, and those things are being counted still even though they have no impact.
So the real question is, and what we talk about a lot when we talk about measurement and measurement model for social media, is called conversation impact – how do we measure what is actually happening and how people’s perception is actually shifting? That is a big question in PR. We actually focus a very long time on trying to measure because to some degree PR is very much about creating that awareness and creating that shift in perception. In advertising they are just starting to latch on to that idea that reaching 1,000 of the right people is much more impactful than reaching 5,000 of the wrong people.
And how do you measure that impact on brand?
There are a number of ways. One is share of voice within a category. There is also ways of measuring conversation tonality, positive or negative, there is a whole host of other ways, in this measurement model that I mentioned there are actually six different criteria that have sub points of many different sub criteria and it is a very mathematical formula for figuring out whether we made an impact and to measure if we actually made an impact and if we actually moved the needle.
That is really what brands are looking for because when it comes time to take this activity that they tried out and explain it to the CEO and why it was worthwhile and why they might want to invest more money in it, that is a necessary piece to have.
Thank you for that. So where are you off to now? Off to Washington?
I will be heading back to Washington after the weekend.
Can I just ask, if you actually had to pinpoint anywhere in the world, is there actually any place that is leading this change?
I think that there is a lot of innovation that typically comes from San Francisco, because so many Web 2.0 start-ups that are based there.
So tell us one exciting thing that is coming out of there.
There are a number of services that are starting to offer this idea of location-based information.
Points for example, is one of these tools that you can broadcast out to your social network where you are and what you are doing, so other people can engage with that and perhaps meet up with you. I think for a certain generation of people or a certain group of people who broadcast their whereabouts and what they are doing on places like Twitter, and have their GPS enabled phones, the ability to have these fortuitous meetings that happen by accident, they would still happen by accident but could we get these people together more frequently. So that if I was in a coffee shop and a good friend of mine that I hadn’t seen in a year was in the coffee shop right next door I would know that, somebody would tell me that so I could then connect or choose not to connect.
Sounds like a nightmare.
Yeah, sometimes it is good and sometimes it is bad. I think the thing with a lot of these tools is that it is all up to you. It is definitely not for everyone but you asked me what was next and that is what I think.