New media marketing is creating an undercurrent that is shifting the very foundation of business. Without a full understanding of what’s possible, a clear view to the future or an idea of the strength or extent of the market undertow, executives cautiously embrace emerging social and mobile channels based on guidance of internal champions and external pressure from competitors and customers alike. But, leaders can only lead when their vision is focused and direction is defined. The ability to execute becomes paramount and the gaps that exist between goals and capabilities must be identified and solved for quickly to stay the course.
Metrics are critical indicators of performance and progress yes, but when new media enters the fray, more questions than answers cloud the ability to see beyond the horizon. And, as new media becomes increasingly disruptive, innovation and a bit of clairvoyance are required to serve up new hypothesis that help leaders make decisions in the absence of history or precedence. It is in these times when competitive threat is equal to, or in some cases less than the threat of digital Darwinism. When technology and consumer behavior cause change faster than your ability to recognize and adapt (and lead), we surface the first and potentially dangerous series of slipping points that like the game of Chutes and Ladders, cause us to fall further away from our position or intention.
By the Numbers
These days, solutions are more experimental than they are evident. As a result, businesses rely on what they know. In this case, existing metrics and frameworks are applied to help ease testing and experimentation. Earlier this year Duke University’s Fuqua School of Business and the American Marketing Association published the results of its annual CMO Survey. Among the findings, we learn how executives are applying traditional metrics to new media to measure performance. Additionally, we can compare the current trends in measurement to this time last year to get a view into how businesses are adapting measurement against new opportunities.
At the top of the list, we see that traffic (hits/visits/page views) is the most important metric according to the report, increasing from 47.6% to 52.2% in one year. Naturally, repeat visits rank second at 34.9%. However, a less important metric, the number of followers or friends, commands the third spot at 34.1%. This represents a huge jump from 24% the year before. Clicks to action were surprisingly positioned in fourth with 29.3%, up from 25.4%, with marketers tracking conversion rates from visitor to buyer. I would have expected this in second or third. And, oddly enough, the importance of measuring sales fell from 17.9% in 2010 to 13.3% in 2011. The importance of measurements such as revenue per customer also plunged from 17.2% to 9.6%; customer retention costs dipped from 7.7% to 6.4%; and, profits per customer dropped from 9.4% to 4.8%.
At first glance, I can’t tell if these numbers represent the migration of an organization toward a culture of customer-centricity or a culture of compromise. Are these numbers falling because they’re difficult to measure or is it because they’re not important? Certainly with all of the discussions about ROI and the importance of proving the ability to meet customer needs while triggering meaningful outcomes, we could find a way to improve engagement strategies beyond the 3F’s (friends, fans and followers). To survive digital Darwinism, we must challenge ourselves and management to migrate toward relevance and significance. That means new metrics are necessary to measure progress in a new direction.
Over the last several yeras I’ve met with countless business leaders seeking input into the insights and corresponding metrics necessary to listen, learn, engage, and adapt in a new era of empowered consumerism. In fact, I believe that a significant gap exists between existing metrics and those required to chart new courses toward relevance. For example, one metric that I hear more often than not is the reduction of inbound customer inquiries as a result of DIY or automated knowledge bases. Of course, if the customer can answer their own questions, they won’t need us. But, that same metric is carrying over to social media. If a Tweet can resolve a problem, the company has succeeded in reducing the inbound burden to the contact center.
At a time when executives claim that getting closer to customers is a top priority for 2012 and beyond, how is it that we can employ metrics that continue to do what businesses have done so well over the last couple of decades – the ability to move further away from customer engagement through barriers of technology? Customers just want to hit “0” to talk to someone live. The same is true for new media. Customers are in control of their own experiences, what they share, and how they make decisions. Businesses can either accept this reality and work towards a collaborative business model of co-creation or simply choose to not be part of the long-term equation.
With an effective reduction of published negativity, we should explore acts of increasing customer engagement as a way of cultivating meaningful and productive experiences. It is through the generation of positive experiences that we can assure the materialization of other important business drivers such as sales, referrals, acquisition and retention costs, etc. More importantly, we can ensure relevance. Everything begins with understanding what it is that customers want and mapping these findings to what executives are driving toward. In the process, you may in fact find that a gap exists. But discovering the gap is what you’re supposed to do when the future is uncertain. It is what you do with this new found awareness that defines your place in the hearts, minds, and wallets of customers and prospects.
Ignorance is bliss until it’s not. After all, if ignorance is bliss, then awareness must be awakening.
Connect with Brian Solis on Twitter | LinkedIn | Facebook | Google+ | BrianSolisTV
___
The End of Business as Usual: Rewire the way you work to succeed in the consumer revolution
Pre-order now at Amazon | Barnes and Noble | 800CEOREAD.
___
ENGAGE!: The complete guide for businesses to build and measure success on the social web
___
Click here for your favorite infographics…now in 22 x 28 poster format!
___
I love the chalkboard graphic. It’s like we we need to reeducate ourselves how to play well with others. It’s such a simple and basic rule of human interaction, but so many never learned it…
IMO, the “collaborative business model” and integrating social media into the company organizational structure is key to making listening,learning, engagement, adaptation work. Amazon does this well. It’s so much measuring as it is “true customer engagement”, and being transparent with customers. Metrics will fall in place if you concentrate on your customer.
This is a good article and offer some helpful information for me,thank you
Good advice!_)
Thank to admin for published the great website…
i appreciate for published the helpful information, really it helped me, Thanks…
You Need To Listen To New Voices
When the turn around expert, Gertner walked into IBM at the time
when no one thought they would survive, he asked “How many people do we have
under the age of 40 who are based on the West coast in Northern California on
our core team?”
The answer was none.
He then told IBM that they would fail. He told them that 85% of
the innovation that’s happening in our industry is coming out of silicon valley,
by people under the age of 40.
He made sure they understood that they needed to listen to new voices. People
with a completely different life experience. They will naturally cause us to
innovate. We can’t do this by visiting them once in a while. Proximity is power.
Whenever you’re around something day in, day out, it’s gonna
have an effect on you.
what a great post! thanks!
I totally agreed that a person should always listen first and then react and what i really like in this post is a message in 4 chain words “Listen, Learn, Engage and Adapt” .
Well i really like the topic headline and nice short form of ALF ‘Always Listen First” . Nice post Brian.
Terrific insights on the role of metrics as a reflecting of underlying mental model that managers use for thinking about social media. I hope to offer more insights about the relationship between metrics, underlying customer centricity, and performance in subsequent blogs at cmosurvey.org. Working through the results for the best insights. I took a stab earlier in the week at trying to understand the problem that firms are not integrating social media into their strategies. I think this says a lot about where are in the evolution of social media as you suggest in your reflections about social media. However, to push us forward, I offered some thoughts about how we can diagnose a firm that has
integrated social media into its firm’s strategy–this is an aspirational state I think companies should strive for in integrating social media. My “social media integration report card” highlights fourteen behaviors that I think a company engages in. http://www.cmosurvey.org/blog/a-social-media-integration-report-card/
Great post. I feel that in PR and Media relations social media is
changing nations. If you work in this industry then this shift affects
your communications and how you work with your audience. For all the benefits of Social Media, there is a lack of
quality and reliability of social media response. And a lot of time, people tell you they would do something that they might not, really. And you get bad information.
I starred this to read last week because I was busy and I’m now happy that I remembered to come back to it.
I’ve noticed a bit of a shift in the way certain companies are measuring their social media efforts. I think in the past, people called them “soft metrics” but they’re now becoming much more concrete. As companies are trying to become much more customer centric I’ve seen people who are interested in measuring things like how long did it take us to respond to a tweet, did the customer leave the exchange satisfied and how many @ mentions were we able to respond to compared to how many there were in a given day? These things are starting to be seen to companies as valuable measurements as they start to think of the ROI of customer interactions being the thing that leads to financial ROI.
I agree that people need to start rethinking the way they go about measuring the online activities and I think that there will soon be a middle ground between these soft and hard metrics.
Cheers,
Sheldon, community manager for Sysomos
“If you can measure it, you can manage it.” – Peter Drucker
Amazing presentation listen.
Interesting which measures are trending in the game of Darwinistic digital dominance. Authentic customer connection is the goal, but how do you measure that exactly? With new tools and social media, and just as important, their adoption, in constant flux it’s a challenging puzzle.
It’s very true, customers would love to peel away those technological barriers and get closer to the human side of the companies they interact with. It’s one of the reasons why new media can be so empowering to small businesses that realise this.
To be fair, I can understand why larger companies resist this. They can scale technology easily, but they can’t scale staff that easily. It’s an interesting paradox that Google, arguably the company that enabled this massive growth in social marketing, is resistent to this exact same thing. Just try giving Google a call on the phone sometime and see how far you get!
It is what you do with this new found awareness that defines your place
in the hearts, minds, and wallets of customers and prospects.