IT’S NOT ABOUT BEING ON SOCIAL IT’S ABOUT BEING SOCIAL

4th Latin American Retail Conference (CLAV’11) Keynote Address São Paulo, Brazil October 2011 Prof. Chris Dellarocas Boston University www.dellarocas.com

A revolution is underway

But it’s not about the technology

It’s about a

parenthesis in human history

that’s coming to an end

Not so long ago… all business was social

Consumers and merchants would engage in candid public conversations

Others would weigh in

The entire community would sometimes become very engaged in the matter

Then business started scaling Then business starting scaling

But social could not scale so it disappeared from business

Corporations started to develop some really bad habits

Targeting people

Segmenting people

“Campaigning”

It‘s like companies are at war with customers

Then came Social media

And because humans are hardwired to be social

Social re-entered business and commerce with a splash

So to understand how to do business in a world of social media

You do not need to deeply understand the technologies

You are better off understanding humans – not as consumers, but as

social creatures

People need a sense of purpose and have an innate desire to be helpful to others

People value fairness and are willing to spend a lot of effort to punish unfair treatment

United breaks guitars

People like to do what others do

Iphone 4 debut, Paris

Ipad 2 debut, Beijing

Some people love status more than money

Oh, and there is one more thing

76% of people think advertisers LIE

Homo economicus is dead Long live homo sociologicus

People want a sense of purpose

People want to help and be helped

People want to be treated fairly

People want to do what others do

People crave for recognition and status

So, to survive and thrive in the world of social media, you need to…

Transform your business processes into social processes

Accept that consumers are now (re)empowered to act as social beings

So, you need to…

A social process is NOT…

Running traditional programs using social media platforms

A social process is NOT…

PR using fake blogs run by corporate

A social process is NOT…

Generating leads by spamming hashtags on Twitter

A social process IS…

Engaging human passion, sense of purpose, reciprocity and fairness to get others, whose “job” it isn’t to do so, to help you achieve your business goals

For example…

How to design a social process?

Find your tribes

Both inside and outside the org

And get them to help one another

Across functional areas

Find your tribes

Both inside and outside the org

And get them to help one another

Across functional areas

How to find your tribes

Identify passions, lifestyles or needs that people form groups (tribes) around and where your products can play a useful role

The product

The tribe

The store

The tribe

The company

The tribe

Find your tribes

Both inside and outside the org

And get them to help one another

Across functional areas

Find your tribes

Both inside and outside the org

And get them to help one another

Across functional areas

And get them to help one another

Provide proper incentives

Identify genuine needs

Manage interactions among incentive features

Incentive design framework

Feeling of purpose

Reciprocity

Fairness

Relationships

Sheer Fun

Competitions

Points and ratings

Membership levels

Honor badges

Leaderboards and rankings

Monetary rewards

Virtual currencies

Perks and privileges

Design intrinsic

incentives

Design status

incentives

Design material

incentives

“Love” “Glory” “Money”

Gamification and badges

The SAP Developer Network

Source: Francois Gossieaux

Original Incentive System:

Point system leading to personal rewards

Results:

Bullying behavior in the community

New Incentive System:

Point system leading to donation to charity

Results:

No more bullying

Find your tribes

Both inside and outside the org

And get them to help one another

Across functional areas

Social media is not

just about marketing

Is this marketing?

Is this customer support?

Is this knowledge management?

Is this recruiting?

Social media are blurring the lines across many previously distinct functions

Marketing

Public Relations

Sales

Customer Service

Product Development

Consumer Research

Recruiting

Knowledge Management

…

Your operations is your new marketing

United breaks guitars

And yet…

Source: Tribalization of business study, (Beeline Labs, Deloitte et al. 2009)

Find your tribes

Both inside and outside the org

And get them to help one another

Across functional areas

Designing social processes requires a leap of faith for most

organizations

Segment

Customer

Channel

Hierarchy

Segment

Customer

Channel

Hierarchy

Community

Partner

Network

Crowd

Where do you start from?

My suggested social pilot project approach

Step 1: Get to know your tribes (not your segments) their passions and their needs

Step 2: Think how you can help them (not sell to them, not get them to do something you think is worthwhile, even if it’s charity)

Step 3: Figure out how you can best offer this help through online communities, twitter, facebook, youtube etc.

Step 4: Assign joint responsibility for this project across departments (marketing and customer support is a good start)

Remember It’s not about being on social It’s about being social

Inspiration – Further Reading