'Listening' through Online Social Media: Consumer Marketing Research 2.0

Objectives, not technology, should drive groundswell strategies." It's almost poetic.

This is one of several good videos on the topic of Groundswell from the book's authors at Forrester Research, but ok, here's the real point: 'Listening' (to your consumer) is the discussion rage today regarding social media. Much is being said to the effect that social media will now allow marketers to (finally) be in-touch with their consumers. Well, any agency that says this, should be replaced -- ASAP. No doubt, social media is a turbo-charger when it comes to dialogue with consumers, but any agency with this view gives hint to the fact that they have little or no experience with the science of consumer marketing research. Forrester rightly urges marketers to get onboard, but they don't diss the value of traditional reasearch. There aren't many meaningful consumer brands that ever existed, prior to social media, without years of focus group research, attitude & usage studies, brand and advertising tracking surveys, various forms of purchase panel data, telephone, brand clubs and direct-mail CRM, etc., etc., and the timeless feedback from store managers and sales personnel -- not remotely ignorant of the wants and needs of their consumers. Social media is huge, for sure. With a growing world consumer population in the billions, real-time speed of information, not richness of learning, will be it's most profound impact. It represents many new things now possible or made easier to do than before, but the possibility of companies now 'listening' to their consumers (for the first time) gets too much attention relative to the other business implications of social media.

How reckless is it when someone who doesn't have research expertise with sampling methodologies and representation, or potential differences between 'claimed' responses and actual behavior, or the issues associated with 'group think' when openly dominant opinions overshadow others, or the appropriate uses for qualitative insight vs. quantitative data, and the list could go on, insists upon the idea that social media is the savior to lead marketers out of the darkness of not understanding their consumers? Such folks are well-intending, but for sake of following a new technology, they shun the lessons available from decades of the consumer marketing that often pre-dates their careers. As the saying goes, "those that do not learn from the mistakes of the past, are destined to repeat them."

A better line of thought when it comes to the power of learning from consumers online is the broader subject area of Web Analytics. In DMNews, Rick Weinstock, DirectGroup North America states, "...Businesses that were well-established long before the advent of e-commerce face unique challenges when it comes to analyzing consumer behavior. ...While the multichannel approach enables marketers to improve customer lifetime sales and the overall customer experience, it continues to be important to cater to your offline-only customers. ...Online activity for multichannel customers is often heavily impacted by recent offline promotions, skewing sales toward items appearing in print." The relevance here is that we really don't live in an offline or online world (with all of us now on our way exclusively to the online world), we live in a "multichannel" world. It's a multichannel world where offline and online experience is interrelated, and thus, offline and online marketing are interrelated. An intersection of Web analytics, relevant social media, sales data and traditional marketing research, all reconciled for consistency of implications for the brand business, may be my personal 'dream team' dashboard of choice.

Marketers and Wall Street Have Similar Questions for Investments in Social Media

An interesting breeze was felt last week, one which might be an indicator of how the winds may be changing for Social Media. A story published by Dow Jones Newswires quoted a Wall Street analyst on the subject of the virtual software company, VMware. I read the story because I had been a buyer of the IPO last year, but have since sold my shares. What I found interesting though, was the last paragraph, commenting on the changing perception of Wall Street for online applications within the context of Web 2.0.

"Maybe VMware has a very strong product offering today, but the question investors are struggling with is, for how long can VMware continue to have a technology lead," said Trip Chowdhry, an analyst with Global Equities Research…

VMware has started to make noise about how Microsoft is spreading the so-called FUD factor [fear, uncertainty and doubt] into the market. The company posted a defensive white paper on its Web site last month, in which it noted that Microsoft is "trying to restrict customers' flexibility and freedom to choose virtualization software by limiting who can run their software and how they can run it."

"Over the last three months or so, the entry into this space has been very aggressive," Chowdhry said. …It seems a stretch to imagine that VMware will ever return to the highs it saw last year. Chowdhry also points out that another driver in the stock's run-up was the fact that some investors have looked at virtualization as an industry, when in actuality it is a feature that most business software companies -- large and small -- are now battling to offer…

"Virtualization is a feature, not an industry," Chowdhry added. "Once it is a feature, you cannot command the same valuation as an industry." This is something that many of the Web 2.0 start-ups in Silicon Valley are going to have to learn as well, but that is a topic for another column. (END) Dow Jones Newswires

What I find interesting about this story is how similar the hesitation is for some brand marketing executives as compared to some financial analysts in the area of Social Media. I am a fan of online Social Media. I don’t think anybody doubts the transformational impact that it is having on empowering the voices of consumers with brand providers in the marketplace and the influence of sharing brand perceptions within such networks. Unfortunately, there is also a lot of suspected hype, as some corners ‘adjust’ theories on ideas such as the ‘long-tail’ in order to support their latest concept of how Social Media will affect future brand consumption – and sometimes these viewpoints lack any real experience with consumer insights or psychology (especially offline) or experience with the production and distribution realities that balance against the consumer appeal to be gained through customization. (I plan to address this in more detail with a future post.)

What is interesting, is that while everyone sees tremendous change, this quote acknowledges that it is still yet unclear where and how the most effective investment (or marketing spend) can work within Social Media (and that’s not to assume it would be anything but different for each and every brand, depending upon category, involvement, etc.). For example, the recent addition of targeted social ads on Facebook, seems like short-sighted, first-level thinking ...(yes, even if it leads toward Google-type search potential, it still seems like ‘putting the cheese in front of the consumer mouse’). That’s fundamentally inconsistent with the appeal of Social Media. And are social network sites really just a 'feature'? Why couldn't large online email providers like Hotmail or Yahoo promote social networking and profile capabilities within their vast existing email account bases? Regardless of the application or digital data stream, tomorrow’s consumer is going to quickly catch up with any strategies to reach them via Social Media, and not every approach is going to work transparently as planned.

Everyone agrees that Social Media represents a profound change for consumers and brands, but not everyone agrees on what represents the best approach to this opportunity, to date (especially for offline non-ecommerce brands). To many brand marketing leaders, it still looks mostly to be experimentation, at this point, and that must affect perceived ROI.