MBA Creator Module

Social Media: Business Applications

Lisa HarrisMarch 2012

About meLisa Harris runs the MSc programme in Digital Marketing and is co-chair of the University’s Digital Economy Research Group. She is an accredited tutor for the University of Liverpool online MBA programme. Lisa has on going research projects investigating how ‘early adopters’ of new technology are using social technologies to ‘punch above their weight’, integrating digital literacy into the curriculum, the interaction of ‘real’ and ‘virtual’ space in learning contexts, and the development of new business models in publishing and recruitment. • http://lisaharrismarketing.com• www.twitter.com/lisaharris• www.slideshare.net/lisaharris• www.delicious.com/lisaharris1

Session Plan

• The history of technological change• Current ‘big pictures’ trends• Challenges and opportunities for businesses of

recent developments in social media• Guest presentation on Chinese social

networks by Ring Xu (@ciciyun)• Building your own digital presence with guest

presentation by Maria Serres (@mjserres)

Events that might interest you

• Creative DigiFest #SXSC 18 May – Showcasing innovation and creativity in the digital

space, all welcome– Student Union, Highfield campus from 10am

• Digital Literacies UnConference 14 June– Wide Lane, Southampton Airport

History

Technological change examples

• Gutenberg's printing press• Radio and early TV outside broadcasting:

Phar Lap• The secret history of social networking (Rory

Cellan Jones, 30 mins, audio)

Fear of new technology...

Roger’s Diffusion of Innovation

With successive groups of consumers adopting the new technology (shown in blue), its market share (yellow) will eventually reach saturation

Christensen: The Innovator’s Dilemma/Solution

• Business innovation that uses a disruptive strategy rather than a sustaining strategy to overturn dominant /incumbent players

• “Sustaining strategy” relies on incremental improvements in performance of an established product

• “Disruptive strategy” provides a radical “good enough” alternative – starts at bottom of market but progresses because it is ignored by complacent incumbents– Microsoft, Dell, Toyota, online publishing

• Clayton Christensen video (9 mins)• Clayton Christensen Video 2 (2 mins)

Internet technology has changed the world

■ Years it took to reach an audience of 50 million:

Radio 50 years TV 13 years

Internet 4 years iPod 3 years

2 years 2 years

1 in 8 marriages in US now as a result of online dating.

US Dept Commerce

Exercise 1: What technologies are being discussed here?

• “The modern world overwhelms people with data and this is confusing and harmful to the mind” (Conrad Gessner, 1565)

• “It will create forgetfulness in the learners' souls, because they will not use their memories.“ (Socrates, 469-399BC)

• “It socially isolates readers and detracts from the spiritually uplifting group practice of getting news from the pulpit” (Malesherbes, 1787)

• “It might hurt radio, conversation, reading, and the patterns of family living and result in the further vulgarisation of American culture“ (Ellen Wartella, 1962)

• “It’s making us stupid” (Nicholas Carr, 2008)

Current Trends

http://www.socialnomics.net/2011/12/28/infographic-every-60-seconds-on-the-web/

The changing media landscape

http://www.smartinsights.com/digital-marketing-strategy-alerts/new-media-options/

Mobile stats: www.smartinsights.com

• Global mobile data traffic grew 2.6-fold in 2010, nearly tripling for the third year in a row

• Mobile network connection speeds doubled in 2010• Smartphones represent only 13% of total global handsets

in use , but 78% of total global handset traffic• Predictions:

– Global mobile data traffic to increase 26-fold between 2010 and 2015

– There will be nearly one mobile device per capita by 2015– Two-thirds of the world’s mobile data traffic will be video by

2015

Growth in mobile apps

20

Web advertising grows from smallest to largest in 6 years

source: IAB (2010) PricewaterhouseCoopers / Internet Advertising Bureau / Advertising Association / Radio Advertising Bureau / WARC , March. N.B. WARC Recruitment data included from 2003

TV Advertising

Web Advertising

Press Display

Direct Mail

Press Classified

Outdoor

Radio

£ millions

Facebook spreads across the web...

The 1:9:90 rule

• 1% are content CREATORS (aka make a lot of noise)

• 9% will COMMENT (aka make some noise) • 90% will CONSUME (aka say nothing, but

presumably still obtain value)

What is SMO?• Two views:

– Narrow: Using social activities to support SEO – Broad: Improving effectiveness of all social

media marketing – Optimising this process – from central hub:

http://www.smartinsights.com/social-media-marketing-alerts/what-is-social-media-optimisation-smo/

Emerging research themes

• Social media platforms are moving from identity construction to full scale WOM networks, driven by developments such as ‘Like’ and Beacon

• Peer recommendations are trusted more than advertising messages originating from the company concerned (Sen, 2008)

• Social capital is built through credibility and willingness to share (Ellison, 2007)

• Identification of key influencers and the role of ‘weak ties’ on WOM (Lauchlin and MacDonald 2010)

Social Media for Business

Applications of social media for business

• Engaging with customer fan base• Resolving customer service issues• Effective, real time internal communications across

the enterprise and hierarchies• Tracking trends and testing the “zeitgeist”• Crowdsourcing of new product development or

market research • Networking to source expertise or business partners• Improves search engine visibility

It’s all about doughnuts

• Here’s why

Exercise 2

• Look up these examples of business use of twitter:– www.twitter.com/ronandunneo2– www.twitter.com/albionsoven– www.twitter.com/delloutlet– www.twitter.com/smartinsights– www.twitter.com/southamptonuni

• What do you consider to be the strategy behind each of these cases? How effective is it?

The Scope of Twitter

• Customer service Become known as a reliable and informative source of help @comcastcares @albionsoven

• Special offers @delloutlet • Get Feedback. Ask for advice and you’ll receive ‘collective intelligence’ from

your community @ibmresearch• Direct traffic. Include links in a tweet to direct traffic to your blog or to the

recommended posts of others. • Read News. subscribe to feeds for specific websites/conferences, or from

content providers such as the BBC. • Network for business benefits. Interact with other like-minded people, or

experts in your field. Develop relationships for future mutual benefits such as testimonials or peer recommendations.

• Find Prospects. Twitter can be used as a means to find potential customers or clients online.

• Provide Live coverage. For example to provide real time coverage of conference keynotes, or travel information @tubeupdates

• Set Up Meetings. An informal and casual way of arranging adhoc meetings. • Satire @fakesamcam• Fundraising @bletchleypark

Facebook brand pages

• Recent changes allow anyone to direct message a brand page - responsive companies will gain competitive advantage

• FB ‘Offers’ allows brands to offer coupons to fans directly into their newsfeeds

• Real time insights and competitor insights provide metrics on the reach and impact of individual posts

• Timeline now available to brands• Full details on We Are Social’s blog

Best practice examples• Dell for Business• The Intelligent Garden:

– 2011 update (9 mins)– Part 1 – Overview (7 mins)– Part 2 – Tools (9 mins)– Part 3 - pulling it all together (9 mins)

IBM on Social Media• No IBM corporate blog or Twitter account• 17,000 internal blogs• 100,000 employees using internal blogs• 53,000 members on SocialBlue (like Facebook for employees)• A few thousand “IBMers” on Twitter• Thousands of external bloggers• Almost 200,000 on LinkedIn• 500,000 participants in company crowd-sourcing “jams”• 50,000 in alum networks on Facebook and LinkedIn• Results:

– Crowd-sourcing identified 10 best incubator businesses, which IBM funded with $100 million

It works for them...• Decentralised social media is driving unprecedented

collaboration and innovation.• IBM lets employees talk—to each other and the public—

without policing• IBM does have social media guidelines (created by

employees) They state that IBMers are individually responsible for what they create and prohibit the releasing of proprietary information.

• Internal tools developed and tested by employees can later be added to product portfolio

EMC Community

Dell Case Study

• The ‘exploding laptops’ disaster in 2005 prompted major change in how Dell interacts with its customers Dell Laptop Fire (4 mins)

• Dell Social Media Command Centre• Richard @ Dell @ Le Web (6 mins)• Check out www.dell.com/community for Dell’s

current social media based interaction with customers

Heinz: purchase from within FB

Heinz Social Media Campaign• 3,000 bottles of limited edition ketchup with

balsamic vinegar available exclusively to purchase through a F-commerce app

• First branded food product to be launched and sold through FB in UK

• Made available pre-launch to 57 bloggers• Launched for real at agency’s office “business

breakfast” event• Subsequently available in supermarkets

Exercise 3

• Look up these examples of business use of Facebook:– www.facebook.com/avgfree– www.facebook.com/dogstrust– http://www.facebook.com/groups/wigglywigglers– www.facebook.com/asos

• What do you consider to be the strategy behind each of these cases? How effective is it?

Business Challenges

www.briansolis.com

United Breaks Guitars...

• The original video• What happened next, including interview with

Dave Carroll • http://www.davecarrollmusic.com/

Exercise 4

• What a) opportunities and b) challenges do you consider that businesses face with regard to social media developments?

Opportunity or threat?

• Allow interaction and engagement between business and customers

• Allow customers to engage with each other• Customers now more likely to take recommendations from a

stranger than one directly from the supplier • Companies can no longer control the content of their

message, but can influence the dialogue to some extent • http://mashable.com/2009/09/22/social-media-business/ “Businesses who choose not to adapt to the new culture will be at an increasing

disadvantage…we are now in the age of open communication, engaged dialogue, and transparency, and business success has less to do with the size of ad budgets than the quality of interactions with customers.”

Resistance to change• Businesses are often tied into complex and bespoke

IT systems and traditional organisational structures. • Management permission is required for IT changes. • Fear that trade secrets might be given away, so

creativity is limited by “walled garden” IT policies • Mindset is still about broadcast rather than

conversation• Change is regarded as threatening and disruptive.

Unwilling to change the status quo, on the basis that “if it ain’t broke don’t fix it”

• Banning access to social networks puts their staff at an increasing DISADVANTAGE

Early adopter research by McKinsey

• Survey of 50 ‘early adopter’ executives• Level of investment in web 2.0 expected to grow by

15% annually for next 5 years• The research identified issues with:

– Restrictive organisational structures– Resistance to change– Inappropriate use of social media (eg for one way

communications)– Lack of support from senior managers to ‘scale up’ creative

ideas from workers

Summary

• Businesses cannot avoid social media...conversations about the brand will be taking place online regardless

• Social media is moving beyond an experimental marketing strategy to impact upon all areas of the business

• Structural and cultural change may be required to realise the benefits

• Disruptive potential of value chain ‘unbundling’

References• Sen, S. (2008) "Determinants of Consumer Trust of Virtual Word-of-

Mouth: An Observation Study from a Retail Website", Journal of American Academy of Business, Cambridge, 14 (1), pp.30-35 http://tiny.cc/495ub

• Ellison, N. B., Steinfield, C. & Lampe, C. (2007) "The Benefits of Facebook “Friends:” Social Capital and College Students’ Use of Online Social Network Sites", Journal of Computer-Mediated Communication, 12 (4), pp.1143-1168 http://jcmc.indiana.edu/vol12/issue4/ellison.html

• Laughlin, J. & MacDonald, J. (2010) "Identifying Market Mavens Online by their Social Behaviors in Community-Generated Media", Academy of Marketing Studies Journal, 14 (1), pp.55-70 http://tiny.cc/8q2mb

• www.delicious.com/lisaharris1 (mang6235 tab)

Online Resources

• Eric Qualmann (video, 2 mins)• 10 Years of changes in technology, BBC report by Rory Cellan-Jones (3

mins): http://news.bbc.co.uk/1/hi/technology/8434373.stm• http://www.youtube.com/watch?v=jDi0FNcaock (Future of Shopping,

Cisco, 1 min) • http://www.ted.com/index.php/talks/evan_williams_on_listening_to_t

witter_users.html (Evan Williams @TED, 7 mins)

• Schawbel, D. Personal Branding Blog, http://personalbrandingblog.wordpress.com

• http://mashable.com/2009/09/22/social-media-business/ (4 ways SM is changing business)

• Jeremiah LeWeb keynote: slides plus video