We are all about marketing, data, analysis, innovation and technology

Thursday, May 17, 2012

Seriously, You Can't Blame Facebook!

Ok guys. I am really tired of all the stories popping up these past couple of days trying to dog poor Facebook because of our inability to prove the value of this vast platform from a marketing perspective. Yes, maybe Facebook needs to add a consulting arm to help marketers maximize the benefits of what they have to offer like Google does for paid search (and I am sure they will in due time), but that doesn't mean we can blame them for our lack of marketing strategy.

Let's get real. Facebook is a new platform for most marketers. Many are still trying to figure out how it fits into their existing marketing strategy, and many are not doing a great job at it. Many still think Facebook marketing is a job for interns or a part-time gig for the programmer.

Here is the lowdown: Facebook is not a channel. It is a medium. The primary goal of any company should be to use it to aide the brands efforts in increasing brand awareness, highlighting and supporting programming, enhancing advertising, etc. This must be done in such a way as to build the brands fan base and extend reach as far as possible. Once built, the brand can promote special deals, contests, etc. within this community that are aimed at exciting that base and keeping them wanting more. But you cannot do the latter alone.

Your Facebook efforts must also be coordinated with existing marketing programs. For a company to think utilizing Facebook is about having a part-time employee post things like "I Love Chevy" on any given day or add a picture of a Vintage Camaro is missing the point. And missing a great opportunity.

When deciding to create a Facebook page, there are questions that must be addressed or your efforts will fail. These must be kept in mind at all times:
  1. Why would someone like my brand, what is in it for them?
  2. Why would someone continue to be a fan down the road, why would they stay a fan? 
  3. What can I do to turn a fan into an advocate? 
Facebook is a platform that you use to wrap around all your other marketing efforts to help enhance their success. If done correctly, you can create a community that will thrive and will begin to take care of itself, much like Sephora (with corporate assistance of course).

Regarding advertising on Facebook: Someone released a study today of all days saying 44% of people would never click on a Facebook ad  ( www.emarketingandcommerce.com ).  Please realize that I can cite another study from 2009 based on real, not surveyed data that says 84% of people would never click on a Google banner ad (www.econsultancy.com ).

Yes, the click-through rates for Facebook ads are about half that of Google. But when you think about how precisely a company can target its Google ads, that is actually not too bad. You may have to test a bit harder to get your desired results on Facebook. So what.  Think of the potential!  A good marketer is not afraid of that.  Also, do not forget exposure is a good thing. Studies abound that show the benefits of brand exposure, and now tools are becoming available which will will allow us to properly assess the true social value:

I cannot image you do not agree with me on this.


GM and Ford - Do Either Really Know How to Take Advantage of the Facebook Platform?

Yesterday was certainly interesting day to be a digital marketer!

When I woke up yesterday and checked the news, I saw the piece about GM pulling their Facebook Ads whereas Ford was, as Ad Age said, "Stepping on the Gas."  When I first saw it, I didn't think too much about it. Many brands do not understand that advertising on Facebook requires a new set of rules and that it operates in a different part of the marketing funnel.  This is just not a problem within GM. It is a broader issue that affects many companies.

 As the day wore on, however, more and more of my contacts were asking me personally what I thought. I saw that the news media was putting more and more attention on this decision and curiously timed announcement by GM.

I myself wanted to understand the motivation behind this decision a bit better, so I researched GM's agency of record to see if any insights could be gained from the team that was supporting their social activity. From an Adweek article dated December 20, 2011, I found out that GM cut their Social Media agency, Big Fuel (http://www.adweek.com/news/advertising-branding/big-fuel-cut-gms-social-aor-137213).  Coincidentally, this occurred as the Publicis Groupe had just acquired a 51% stake in the agency.  Both Publicis and Big Fuel had GM as a client.  Was the release of Big Fuel a sign that the company did not understand Social Media? Was it a sign that it was disenchanted with Facebook at that time?  Was it perhaps a money saving tactic?  Apparently as of this date or shortly thereafter, the social media functions were reassigned. Big Fuel has other Fortune 100 clients who are satisfied.

Just as interesting as GM saying yesterday that they were pulling their advertising dollars from Facebook was that Ford said they would be upping their investment and have been quite happy with results to date on Facebook.  This obviously begs a comparison between the two organizations and how they are using their presence in Facebook to engage with consumers.

I  took a look at the Ford and the GM Facebook pages.  I noted the "Likes" and the "Talking about" metrics, as well as their treatment of their Facebook page cover photo.  Here is what I found:

Cover Page Photo
Talking about
Percent Talking
Montage many nostalgia pictures included
1.216 Million
Chevy Camaro
Camaro Wheel
2.849 Million
Ford Motor Company
DearbornMI headquarters
1.503 Million
Ford Mustang
Car shot with a man
4.048 Million

Cars have traditionally been marketed in a way that is supposed to raise your blood pressure and get your heart pounding.  I felt this immediately when I saw the picture of the Mustang in the Facebook Mustang page cover photo -- I had to have that car.
 Ford Mustang Facebook Page

By comparison, the Chevy Camaro Facebook page cover photo puzzled me, and I was left wondering what was their intention in showing me a picture of a wheel. The Chevrolet Facebook page, in particular, seems to have more appeal for those interested in car restoration.

Chevy Camaro Facebook Page

So, what is going on here? Clearly a case could be made that for both Ford and GM, there is room to do more with Facebook. However, there is a larger failure on the part of GM to construct a cohesive brand strategy with Facebook. In engaging with consumers, they have given up leadership of the dialogue on their Chevrolet page. I formed this opinion when I observed on their Facebook page that the content on the Chevrolet Facebook page is largely supplied by consumers who want to share their nostalgic photos of restored or well preserved old Chevys. That is very nice indeed, and it serves a purpose to maintain brand loyalty and support current owners, but it does not sell new cars.        

To continue the comparison between Ford and GM, I moved from Facebook to their websites.  GM is very Flash heavy, and, as a point of fact, the pages cannot load in an iOS mobile device.

 GM Website on Mobile device (flash not loading)

I wonder, did the executives of GM in their very busy lives, not become aware of how Americans are using mobile devices more and more, and that their website is essentially not consumable by individuals who have a mobile device?  This is more than a little lapse. Since half of all phones sold now are smart phones, all of the individuals who have smart phones will not be able to consume the site while surfing with their phone...ok you see where I am going.  Ford on the other hand loads perfectly on my iPad.

 Ford Website on Mobile device

To build on the point of the websites and message integration, one tactic I have observed from GM is their mobile ad campaign.  I have found that on my Android device I have been served flash-based ads for Chevrolet.  The mobile ads are thematically similar to those run on TV with the cast of characters at the dealership. (Reminds me of "Office" at a car dealership).  These commercials and the characters represented in them could be leveraged to engage with consumers in social media. (It would not be possible to serve the ads on an iOS device because they utilize flash.)

Ford similarly has spokesperson, Mike Rowe of America's Dirtiest Jobs fame.  Mike is always authentic in the commercials and adding him to the social media posts might add another dimension for consumers to interact with the brand.  This is an opportunity for Ford.   

Americans have a unique and strong bond with their cars.  Automobiles are  intertwined into the fabric of our culture.  How is it possible that a major Automotive Manufacturer has to publicly state that they are pulling money from Facebook?  The case is clear that Ford and GM could both do a lot more to leverage Facebook, so I think this announcement by GM has more to do with the disarray in their own marketing strategy and less to do with Facebook.  Ford has a solid advertising strategy and can work towards integrating social media strategies into their already solid marketing.  GM may be looking at a larger overhaul of their marketing strategy (their digital strategy in particular needs some work), and online and offline messages should be made to work together. If GM made the announcement of a pull out of Facebook advertising to bide time while they got their digital ducks in a row, well, then who's stock would take a hit?

So to recap,  
  • 5/16/2012  GM officially announced today they were pulling their advertising on Facebook.  
  • 12/20/2011 GM released their Social Media agency in December 2011 (who was running their Social Media campaigns since December?)
  • Chevrolet has a Facebook page which seems to be largely driven by nostalgia and content which figures prominently cars and trucks from yesteryear, which have stood the test of time.
  • Chevrolet and Chevy Camaro do not employ their Facebook cover photos for heart pounding car pictures.  Chevrolet has a nostalgia montage, and Chevy Camaro has a wheel.
  • GM has a website heavy in flash.  It will not load on a mobile device.
  • Ford and Ford Mustang have cover photos showing the Corporate Headquarters and a full view of the Mustang, respectively.
  • Ford and Ford Mustang's engagement metrics are a bit higher than Chevrolet and Chevy Camaro.
Perhaps Ford is positioned a bit better because the Company is named Ford, and the brand name for the Cars is also Ford.  Perhaps it is a bit harder for GM because they have more brands to manage and lack the strong umbrella brand identity to organize their marques under.  But a complete pullout of advertising seems a bit drastic, unless you don't understand it anyway.  

Success on Facebook requires:
  • Defining the strategic purpose of this medium (I do not want to call it a channel).  Is this medium an acquisition or retention focused medium?
  • Defining the nature of your relationship to the consumers.  Are you a cheerleader, advisor, curator, friend, etc.?
  • Establishing the narrative, what is the message you want to convey to your fans?  Can you structure your message to work with your other channels?  "Hard sells" do not work well in social media.
  • Paying attention to this medium, monitoring the dialogue and commenting appropriately.   
  • Establishing in advance Key Performance Indicators that will identify the effectiveness of the strategy. (If your not measuring it you're not managing it!)
Given the keys to success on Facebook, it is rather predictable that GM bailed out.  They lack a strategic focus for this medium, the relationship is more defined by the consumers than by GM, the consumers also lack a narrative from GM. GM also lacks an understanding of using the images and timeline to their brand's advantage.  I cannot speak to the monitoring or the KPI measurement, but if they dropped their social agency, it is probably not being measured.  Given the shambles of their social strategy why do I care if they pulled their budget from Facebook?  As a marketer I am glad that they are now "out" of Facebook ads, since the inventory of ads will be freed up a bit for those Marketers who can see the path of how Facebook ads work with the other components of their digital strategy.

And in five years, if we think back on this day, we may see it in the context of the knowledge that we build and the best practices that will no doubt be in place for Social Media.  In five years it will be hard to understand how a major corporation made such a move to pull out.

I would love to know if you agree.  Let me know.

Rhonda Knehans Drake

Friday, May 11, 2012

Beer, Sex and Social Media

On May 9th, Rhonda and I attended the first annual Social Media Benchmark conference (www.benchmark-nyc.com) in NYC.

It was a unique conference of a smaller scale that focused on the measurement of social media marketing. Loved it. I found out about it from a student of mine, Katie Krum, who tweeted about the event. Thank you, Katie.

What was my main learning? My main learning is that we are still not measuring or even trying to measure the ROI of our social media marketing campaigns. And to be honest with you, I am not sure why. It is quite disappointing.

When I ask one presenter (to remain nameless) after his presentation why this might be, he said that it is too difficult to bring all the pieces together.

Infinity presented and had no mention of ROI

Unicef presented and had no mention of ROI.

Anheuser Busch presented and had no mention of ROI.

Every company spoke about its great outreach, messaging, and fun and creative campaigns, but none of them mentioned a real assessment of ROI.

Both Rhonda and I were shocked by this. I would have thought we are past the point of enjoying the sandbox without having to justify our playtime with hard numbers. Come on, guys. We can do better than this. For example, to create a nonprofit outreach in the social space for a specific cause, I am sure we can at the very least examine the lift in donations pre versus post campaign. Right?

As a matter of fact, I am about to come out with some very cool social media ROI calculators that should help in this regard. But until then, companies need to try a bit harder.

What were the highlights of the conference? Hearing Cindy Gallop (“make love not porn”) and Jon Steinberg of Buzzfeed (formerly of Google) speak. They were amazing...even though Cindy made me, as a male, feel like a heel.

But the best part was that I was able to get 6 of my Masters students from NYU volunteer gigs at the event so they could attend for free. They manned the registration desk and took on other responsibilities that allowed them to network with all the great people there. I hope they all land great jobs.

All in all a great day!


Wednesday, May 2, 2012

The Force that is Facebook

As the days countdown to the Facebook IPO, many industry watchers have put forth their opinion regarding the value of Facebook as a company. It seems to have become the national pastime to guess what Facebook will ultimately be valued at, and what will happen next within the organization.

Because we, at Drake Direct, are in the Marketing Analytic and Social Media Strategy space, we are close watchers of Facebook. We, therefore, decided to review what we knew about Facebook to determine if they are worth the estimated $100-$104 Billion.

We took into consideration the following when we evaluated Facebook:
  • Advertising trends
  • Online vs Offline
  • Decomposition of Online advertising spend by channel
  • Decomposition of Online advertising by major providers
  • Member growth trends for Facebook
  • Time spent on site (Facebook Vs. Google)
  • Unique visitor growth (Facebook Vs. competitive set)
  • Growth in Facebook Business Pages
Additionally we considered their revenue streams:
  • The traditional advertising model as it relates to Facebook and the competitive set
  • Business growth related to apps, games, and virtual eCommerce
  • Potential new sources of revenue
  • Mobile ads
  • Search
  • Social Reader Fees
  • Initiation of fees for Business Pages
  • Recent acquisitions of Instagram and Tagtile
In weighing all of the facts that others have put forth about Facebook, we have concluded the following:
  • Currently Facebook is under monetized. This was probably a strategic decision on the part of Facebook management. It is clear that the priorities for the organization were first to ensure their infrastructure was solid, and secondly to monetize the business to the fullest.
  • Facebook’s user base is very large, active, and loyal. Their growth into new areas cannot be judged by their current business activities. No one could have predicted that Google, a dominant search engine at the start of the Internet boom, would have developed into the empire it is today.
  • As database experts, we see Facebook’s biggest, and perhaps most under-reported asset, as their database. Facebook possess a database of 900 million users, with virtually every piece of information about an individual from relationships, to political affiliation, leisure time, vacation preferences, entertainment interests, brand preferences and more, all given freely by users. Facebook sits as the gatekeeper, but can monetize this enormous asset by charging a fee to target marketing communications for advertisers. One metric of a database business is the value relative to the database size. By this metric, at $115.55 per user, we feel that Facebook is a relative bargain since on average, there should be at least this much value, on average, per user to be gained.
To view the entire white paper, you can download at: www.drakedirect.com/facebook_whitepaper_by_drakedirect.pdf

We hope you enjoy,
Rhonda Knehans Drake & Perry D. Drake