With worldwide social media spending set to hit US$3.1 billion by 2014 according to Forrester Research, it is now perceived as one of the most lucrative marketing tools a company has at its disposal. But as several high profile PR disasters have demonstrated it is also a weapon used by consumers to attack companies, with devastating results. Diana Milne reports on how best to use social media to your company’s advantage – and what to do if the online chat turns toxic.
“Facebook's membership hit 300 million in September 2009 and is set to double each year”
It's been touted as the most powerful weapon in a marketer's arsenal - the fastest way to get a brand's message across and an eavesdropping device without parallel when it comes to gleaning customer opinion. But as Nestlé recently discovered to its PR team's horror, social media has a dark side. The company's Facebook page, set up to build brand loyalty, became the platform for a hate campaign against the company after news emerged that it was sourcing palm oil from Sinar Mas - an Indonesian company accused of illegal deforestation.
Nestlé's Facebook page was bombarded with angry messages following the release of a video by Greenpeace raising awareness of the company's unethical supply chain practices. This was swiftly followed by widespread criticism of the company's handling of the crisis by industry insiders posting on Twitter. Nestlé responded, first by threatening to remove off-brand logos from its Facebook page and then with a Q&A on its corporate site.
The incident represents every PR department's worst nightmare and was a huge blow to the company's all-important brand reputation. But most of all it is a sign of the times. Social media has created a soapbox from which every consumer in the world can air their views to an audience of millions. Summing up the power of this tool and just how dangerous it can be, Charlie Osmond, Co-founder and Managing Director of London-based social media research agency FreshMinds, says: "Five years ago if people didn't like your product, they would tell maybe five of their friends. Now they can tell five million people with a video, in the space of minutes."
The flipside of this however, is when a company harnesses social media to start a global conversation about their latest product and achieves the kind of exposure that money spent on traditional advertising can no longer buy. A prime example of this is T-Mobile's award winning Dance campaign. Masterminded by Saatchi & Saatchi, the campaign started when 350 performers were filmed breaking into a 'spontaneous' dance routine during rush hour at London's Liverpool Street station. Hidden cameras captured the reaction of commuters as hundreds of them joined in with the routine. Footage was aired online through a specially created YouTube channel, which attracted a massive 13 million hits and became the 12th all-time most-viewed videos in the entertainment category of the site. Fans formed 43 Facebook groups dedicated to the campaign, with the largest made up of 4500 members and 2500 blogs posted the video online. The effects of the campaign on the company's bottom line were dramatic. Despite being in the midst of a recession the company achieved a 52 percent increase in sales following the campaign and T-Mobile stores across the country experienced record-breaking footfall.
A user's guide
The experiences of Nestlé and T-Mobile tell very different stories about social media's role and potential as a business tool. So how can companies ensure they use social media to their advantage and not their peril?
Marc Huijbregts is Saatchi and Saatchi's Digital Director for the EMEA region. His role is to build on the success of integrated digital work such as T-Mobile's Dance campaign and to train and educate clients on how to use social media to their advantage. He believes it is easy for companies to underestimate the amount of planning that goes into a successful social media campaign. Indeed, he says, the simplicity of campaigns such as Dance, and the apparent ease with which they go 'viral', is deceptive. Speaking of his own experience on the Dance campaign, he says: "One of the great misunderstandings that clients have is that once you have created great compelling content, you just put it onto YouTube then it starts to fly around and spreads like an oil stain. The truth is that there is a very detailed strategy behind these campaigns around what to do and in what sequence. We had a big PR push around the T-Mobile campaign and put together a detailed strategy that involved making decisions like when to post the video online - before the eight o'clock news or afterwards. We also had long discussions with Google to make sure we used all the right Adwords so people googled the right content. And there was a special PR team at the event with six or seven PRs calling all their press contacts and online seeding. There is a misconception that social media campaigns happen by themselves. But you have to work with the right people to co-ordinate everything and make specific actions happen."
Key to a successful social media strategy, he adds, is for companies to decide from the start what it is they want to achieve by using social media. Do they want to create a buzz around the launch of a new product, establish lasting relationships with customers or research customer opinion? "Once you have a presence on a social media platform, what are you going to do about it? How will you maintain it and how will you activate people? That requires long term thinking about what you want to achieve," he says.
For companies to ensure they get what they want out of social media, a detailed analysis of the different forms of social media and what each can achieve is essential. Experts agree that no form of social media offers a one-size fits all approach and that each differs in terms of its audience demographic and the type of content platform it offers. "One of the problems right now with social media is that companies are focusing on the tools rather than what is really appropriate for them as a business and how they should be using these tools," says Osmond. "For some brands, for instance, Twitter isn't necessary and isn't important and the people they need to speak to aren't there. Companies need to understand their business goal and put it into the right social media category."
Summing up the differences between the three most high profile social media platforms - Twitter, Facebook and YouTube - Huijbregts says: "Twitter is your real time communication tool, YouTube is a great content platform and Facebook is for connecting your audience and your fans and creating an everyday diary online so customers can keep track of your company. There's no one- size-fits-all solution for companies."
Osmond adds: "We find Facebook pages are great for talking to fans and giving them news and information when they want to get it. But they are not very good at driving purchases for example. Whereas building an online community is better at building a brand around a certain area or subject and driving purchases. Twitter is really a customer service device in my view. It's just a brilliant way for people to voice customer service needs and for companies to demonstrate that they are listening and responding."
Much depends, he says, on whether companies are interested in using social media to create an instant buzz about a new product through a viral campaign or in establishing long-term relationships. "The problem with companies and their approach to creating social media is that they often think only about creating buzz. I think that's a mistake and not a good use of social media. The way in which brands can benefit from sustained success in social media is very different from creating buzz. You can try to create conversations that get people excited in the short-term and that can be very useful for launching a new product but it won't have long-term benefits. To create something that's really viral you need the most creative mind in the world and out of seven million companies in the UK there's only going to be a handful that can manage that."
The voice of truth
Creating online communities is one of the most powerful ways of connecting customers and building brand loyalty, according to the experts. It is also a powerful market research tool, which allows companies the unprecedented opportunity to listen-in to customers' conversations about their products, providing instant results at a speed not possible using traditional market research methods such as focus groups. Steven Cheliotis is Chief Executive of the Centre for Brand Analysis and Chairman of the UK Superbrands, Business Superbrands and CoolBrands Council, which compiles annual lists of Europe's most powerful brands. He says: "Social media is not just about promotion; it's also a very nice research tool that allows companies to combine the promotion side of marketing with the research side. So rather than just telling people to go out and buy the latest Nike trainers, it's also about finding out what kind of trainers people want, what colours they are into and letting the message and discussions about that take place online." Osmond cites the example of www.pampers.com as a particularly successful example of an online community set up by a company, that now provides a valuable market research tool. "Pampers.com is an online community where mothers and mothers-to-be talk about everything that is changing in their lives, and Pampers hosts that conversation. It's not a social network and it's not Facebook. As a result, the company, learns about the target market a lot more and has a closer relationship with customers - and therefore much higher sales. It's a really good example of how a branded community can work for a company."
The creation of branded communities is not the only way to establish a conversation and relationship with customers that can be sustained in the long-term. Osmond particularly admires the work of Nike on its NikePlus website, which links runners together and allows them to compare distances and sporting performance online. "Nike has a device runners can attach to their trainers that links up to their iPod and tells them how far they've run," he explains. "They can then plug that back into their computer and compare their running to everybody else's. It's a social tool and a way of establishing long-term relationships and additional value for customers. It's not just a fun video shown once then forgotten about a month later." He goes on to say that this represents the shapes of things to come for companies in the social media space: "I don't think many marketers are thinking like this yet, but they will."
For those less savvy companies, even just listening in to what is being said about their products and services online will provide valuable insight. "Sometimes my advice to clients who have low ambition when it comes to online activities is 'do me a favour and at least analyse what customers are saying about your brands and campaigns online'," says Huijbregts. "That's the lowest admission level you can have but if you are not aware of what's happening online then you don't know anything. There are quite a few examples of big brands that did not listen to what was happening online and it backfired really hard because they were a week or two late when it came to responding to negative feedback."
A rapid response to an online PR crisis is crucial given the speed (as demonstrated by Nestlé) with which it can unfold. Companies no longer have the luxury of waiting for newspapers to print or news broadcasts to be broadcast, before preparing their response and, thanks to websites like Twitter, are often expected to respond in real-time to comments as they appear online. Companies may be encouraged to put social media strategies in place and create sites and online communities to maximise their use of the technology as a marketing or research tool. But that's where their level of control over social media ends. So how can companies regain control over their brand reputation if an online PR crisis breaks out?
Cheliotis says the first step is for companies to fully understand what social media is and to embrace the fact that it is not just another form of traditional 'push' advertising. "The big difference with social media is that it is not just one-way - it's a two-way conversation with consumers. You're not just talking to customers and saying 'this is what our brand is about' and expecting them to just absorb the information. They are giving information back. And information isn't just coming back to you, it is coming to everyone in your online community. So in effect there are people distributing messages directly on your behalf to customers and potential customers. In some cases these may be positive messages and that advocacy is more powerful than advertising can ever be. But of course they can also be negative messages, which are equally as potent but obviously to the detriment of the brand. Companies have to accept it's a two-way thing and they have to embrace that in order to be successful. You can't block negative messages or manage the negative messages in a dictatorial way. Because if you do that then people will just take those messages elsewhere."
Osmond adds: "Companies need to have an ethos that if there is something wrong with their products they need to know about it in order to make an improvement. If you have that ethos then being involved in social media is going to tell you what's wrong quicker so you can make the improvements faster and more accurately. Unfortunately, there are a lot of companies that aren't ready to hear the brutal and honest feedback."
In order to properly handle an online PR crisis as it unfolds, companies should have a robust crisis management plan in place, just as they would for any other incident that could potentially damage their brand reputation. According to Huijbregts, this is all the more crucial given the ease with which any company employee can respond to customer comments online: "If something does go wrong it's a very powerful way for customers to air their grievance. Companies need a good strategy in place regarding how to respond to these incidents, otherwise somebody within the company could jump into the debate because they feel passionate about it. And they might end up saying something that has not been approved by the corporate communications team."
Cheliotis agrees, adding: "How do you stop someone jumping onboard, talking for you, when they shouldn't be? Or indeed, how do you stop a disgruntled employee jumping on there and revealing the warts and all in a very open, public forum? Companies need to prepare themselves for all eventualities." Huijbregts goes on to say that major corporations that have platforms on all the different forms of social media constantly monitor what is being said about them online so that they can respond quickly to negativity. Citing the example of Coca-Cola, he says: "Coca-Cola had a marketing campaign that was perceived badly by some people and there was some buzz around that in a negative way. The marketing CMO reacted straight away on the different platforms and told customers he understood their concerns and because there was so much negative buzz flying about it had decided to pull the plug on the campaign."
Osmond emphasises the need for companies to have a process in place that allows for a speedy response to criticism or negative publicity. "Speed really does surprise people now. You can't see something hit on a Saturday morning and wait until Monday to respond. People want to hear right now what you're thinking. In the last six months there were five to 10 really high profile issues that hit because now campaigners and upset customers spread their message far and wide very quickly."
Although companies can have little control over the conversations that start about them online, preventative measures can be taken to limit PR damage through the relationships companies form with their customers using social media, according to Osmond. "One of the things about social media is that there is an opportunity to build up a relationship with people before the disaster hits. If you've got a potential PR disaster plan you've probably got your PR people getting to know journalists and people ahead of time. So if a disaster hits and they have an existing personal relationship that will always help."
One way, of course, for companies to avoid the social media platforms they have created from turning against them is not to create them in the first place. Cheliotis believes some companies are fundamentally unsuited to the social media world and should avoid embarrassing themselves by getting involved. "I don't think social media is necessarily for everyone. I do think there is a sort of knee-jerk reaction, a rush to join everything that is new and shiny, and assume that it is important and appropriate for every brand and every sector and every audience. That's not the case. I've certainly seen some brands that have started Twitter or Facebook pages, and you just think, why? Why the hell would anyone want to follow you on Twitter, considering what you do?
The social outlook
Given the rate at which it is becoming an integral part of companies' marketing plans and a huge influence on consumers' buying choices, it is unlikely that many companies will be able to ignore social media for long. According to Gartner, Facebook's membership hit 300 million in September 2009 and is set to double each year. To web savvy customers that translates as 600 million potential customers in 2010 and millions of euros in potential revenue.
Osmond compares social media to the growth of the internet in the late 1990s, and warns that to ignore social media is to ignore a fundamental shift in consumers' relationships with brands. "The main thing to understand is that the expectations that consumers have of brands online is changing and becoming far more demanding. In 1996 people used to look at the internet and ask 'do we really need a website? Let's wait and see'. Four years later the expectations of consumers to be able to find a company online was such that it wasn't even an option anymore. There are still companies that ask whether they should be involved in social media. But in my opinion, in three or four years time it won't be an option anymore. There has been a massive shift in consumer expectations." And it's a shift companies had better gear up for or risk brand invisibility.
Photographic giant Eastman Kodak has successfully used Twitter to gather 11,000 followers online. Jeffrey Hayzlett, Chief Marketing Officer and Vice President of Eastman Kodak, describes his company's social media vision and the joys of twittering.
Our social media activity is very, very heavy. I describe Twitter very much like a fax machine. It's unlike any other marketing tool that's out there. I think it's one that's going to stick around a little bit longer but there are lots of other great tools that are out there.
We approach social media with what I call the "Four Es The first one of those is engagement. Let's get engaged. Those conversations are going on the internet whether it's on Facebook or Twitter or on the blogs, with you or without you. The second one is education. They educate us; we educate them. The third is about excitement. How do we use that to excite people? Then the fourth is evangelism to get the word out there and turn these people into brand ambassadors.
I started Twittering for my family. The only reason I wanted to Twitter was to let them know what I was doing. Then I started gathering all these other followers, and a lot of them were B2B contacts, so it was all these commercial printers and photographers. So now it has expanded beyond that. It's a way for me to interact directly without filters and without someone else telling me what they said or how they said it. I'm directly talking to bloggers. I'm directly talking to photographers. I'm directly talking to commercial printers and our customers and to the CMO of Best Buy, and so forth, through our tweets and through Facebook and a lot of other things.
I can see people who say something about our Kodak ZI8 and immediately, I can send them a tweet about it. The key thing is, I'm listening. One of the best attributes an executive can have isn't about asking questions, but more about listening. We're hiring a chief listener, someone who actually listens to all those conversations that are going across the landscape of social media and then helps to route those conversations and manage those conversations, because there are so many you can't keep up. There's no way one person can possibly do that.