3 Keys to Build Your Online Community

by Eric Tsai

There has been a few interesting development recently on the social web specifically with Facebook replacing the ‘become a fan’ phrase with a ‘Like button‘ and launching ‘Community Pages‘; expect all mainstream websites to gradually adopt the like button enabling visitors to see if their friends or family like the content (peer influence) as well as the number of people liking something.

The other news is Twitter’s new tool that allows tweets to be directly embedded on third-party sites, making it easier to quote and share content .

This growing trend of the web becoming social will continue to encourage people to use it social.

The more social the web gets, the more conversations it generates resulting in a permanent record of everything and anything people talk about, including your brand. Even if you’re not online or don’t have an online business, internet will continue to record down what people say about your brand.

And reputation is word-of-mouth thus it will only benefit your business if you include your community in defining your brand. So how can brands take control of their reputation via the social web?

One solution is through community building, the foundation of your brand’s reputation.

What’s In A Community?

Think of your community as a single platform where people can all gather to interact with your brand and each other expressing their opinions about your products and services.

You don’t need thousands or even hundreds of people to start a community, it can be started with just a few people with the same interest and are willing to participate.

When building a community consider the following groups that makes up the community ecosystem:

Prospects – Interested in your product or want to learn more about it
Customers – Made a purchase already
Employees – Individuals that works for you and/or stakeholders
Vendors – You bought from them (suppliers, service providers, operating expenses)
Partners – Companies or individuals that you have business relationship with, a reseller or distributor of your products
Media – Journalist or publications that covers your industry or your product category
Regulators – Authorities or individuals that regulates your industry, could be government or non-government

If you’ve been in business for a while, you should be familiar with the groups above. The idea of having your own online community is to centralize communication via a single platform where you can empower members of your communities to interact with each other and engage with your brand.

How Communities Benefit Brands

Why would companies want to spend time, resources and money on building their community? The answer is simple, community defines your brand, demonstrates social proof and creates business opportunities.

Defining your brand – So instead of trying to control how you want people to see your brand, the ideal approach is to become part of that process by providing a dedicated community.

A platform that allows prospects, customers, peers, colleagues and stakeholders to interact with each other, ask questions about your products, comment on their service experience or simply give praises.

This is why brands are uniting their customers and fans online using platforms such as an online discussion forum, a Facebook Fan Page, or a LinkedIn Group as their primary ‘homebase’ to build their community. It’s fast, simple and easy to do.

In addition you can expand the community offline or locally adding tools such as Meetup.com, Amiando or Eventbrite. The goal is to provide easy access across multiple channels for your fans to hangout and express their feelings and ideas about your brand.

Social Proof and influence -The best way to change people’s behaviors is through peers that they trust and/or respect.

Done right, your community will become one of your most powerful marketing vehicle helping you sell via conversations and defending your brand during crisis.

This is also an emerging trend as many brands are leveraging customers and employees as brand advocates to help spread the “brand voice.”

If prospective customers read some comments on how great your services are and sees many happy customer feedbacks (via your Facebook wall, Yelp, Amazon or blog), you’re likely to move them further down the sales cycle not to mention the information can be used for marketing as well as support reference.

Even Toyota is bouncing back from it’s PR nightmare because the brand still has a strong following and they’ve earned their customer’s trust over a long time. This is why sports fans are loyal to their teams and often go to the distance to defend their teams/players because they are part of a specific team’s fan community.

Opportunities to improve – Another benefit of building an online community is over time your community will accumulate enough information to enable you to abstract valuable insights to improve your products, services and reputation.

One of the more popular approach is using crowdsourced data to help craft marketing campaigns and get the community involve to deepen the trust and create brand awareness.

And with those that are concern about negative word of mouth?

My recommendation is to have a plan in place so you can respond in a timely matter with the right social media and crisis management policies.

This way, when things go south, you can quickly pinpoint the problem and identify the proper solution to resolve the issue. In fact, it’s an opportunity to turn negative buzz to strengthen the relationship with customers.

As for managing the community it really depends on how your organization is structured for customer engagement.

For example, during presale you can task your sales team to answer pre-sale questions and have your customer support staff responsible for postsale engagement.

Then categorize and archive the Q&As to be used in the future for prospectives and customers.

You can import them into your CRM system or publish them as FAQs.

Keep in mind that managing the community should not be limited to the marketing department.

In fact, the marketing department should help facilitate the interaction to improve the brand experience by providing insights abstracted from the community to other department.

Product engineers can learn how customers are using the product, sales staff can identify the main concerns of prospective customers and marketers can better position and communicate more effectively.

If your organization needs to hire a community manager, I highly recommend following the Community Maturity Model by The Community RoundTable, a private peer network for community managers and social media practitioners.

According to The Community RoundTable, “this model does two things. First, it defines the eight competencies we think are required for successful community management. Second, it attempts – at a high level – to articulate how these competencies progress from organizations without community management that are still highly hierarchical to those that have embraced a networked business ecosystem approach to their entire organization.”

This is an excellent way of looking at what’s necessary to build a serious, large scale community.

As for small businesses, I recommend to simply focus on 1 or 2 of the competencies below that aligns with your business objectives and just keep working at it.

Use a systematic approach to nurture your community and determine how it impacts your business.

Are you ready to start building your online community?

3 Keys to Building Your Community

1) Intent vs Outcome – Know why you’re doing this, what the community is about and be prepared to respond to unexpected outcomes.

Create policies and define a clear purpose also helps to motivate members by giving meaning to participation and build collaborative work by providing a common focus.

With clarity, members will define the purpose on a common ground to grow the community.

Once trust and respect are earned from the community, members will be more incline to be loyal to your brand and what you stand for which should be beyond just a profit-making machine.

It’s a commitment between the community and its members. Your reward as a business should be fueled by the appeal you have with the community.

This is why a growing number of companies are investing in content marketing by publishing free resources to influence the perception of brand value and demonstrate expertise.

2) Communicate with Meaning and Authenticity – The key in building a meaningful community is to be authentic and stay true to you brand.

If you ask your customers what your brand means and you don’t like the answer, perhaps you need to rethink your brand strategy, marketing communication and your corporate culture.

Effective communities develop leadership teams, equip and deploy members for action, understand and engage with their community purpose to achieve impact.

Besides, if you already have customers out there, they may be waiting for you to provide a platform to speak.

Companies are humanizing themselves and to be human is to have a personality. You must accept that you will make mistakes and not everyone is going to like your personality.

However, you should be able to demonstrate expertise in whatever it is that you provide via free education and resources.

If you say what you mean and mean what you say, your community will be on your side.

3) Serve First, Sell Later – The perception of an expert is not only to have invaluable knowledge but a positive reputation. Focus on the needs of your members by making things as easy and frictionless as possible.

It’s a team effort, the community as a whole never just about one person but a collective effort to keep the community going.

The bottom line is community builds trust and it’s not related to making money.

Focusing on financial gain leads to short-term decisions based on cost that’s not sustainable for the future. A focus on the community (or the customer), on the other hand, can lead to happy customers, employees, and partners.

I thought this TEDtalk by Derek Silvers on “how to make a movement” was an interesting way to think about building a community for your brand and why leadership may be over glorified. The video is about 3 minutes long.

The take away: Brands have customers and when these customers have reasons beyond the product and services that they sell, there is a cause.

That cause is what motivates people to connect and spread your brand’s idea.

The greater the commitment to a cause the greater the commitment to the community.

Like the great American cultural anthropologist Margaret Mead said, “Never doubt that a small group of thoughtful, committed people can change the world. Indeed. It is the only thing that ever has.”

Whether it’s in a social network or a weekly local meeting, ALL brands should consider fostering relationships through community building.

For me, I have my blog and Facebook Page to build my community.

Do you have a platform to grow your community? Where should your customer go when they want to be part of what you do and what you believe in?

Why Social Media Can Improve Your Business

by Eric Tsai

After my last post on “How to use Google and Twitter to Find your Customers,” I’m following up on how to abstract value to improve your ideas.

Whether it’s for your marketing research or product innovation, the intention for gathering these data should NEVER be for spamming but to help integrate your value proposition into what people are truly interested in.

If you can become part of what people are interested in, you will have a better chance of connecting. Therefore it’s best to utilize permission marketing when executing your communication strategy.

Getting more data is great, but it’s not intended so you can just add more people to your weekly email blast.

Making quantitative analysis can help you create interesting ideas that differentiate your brand and drive actions.

So how can social media create opportunities for you?

Understand The Social Network Ecosystem

First, learn how each social network ecosystem works and the habits of the emerging “social consumers.”

Think of each social network as a town and the ecosystem is basically the infrastructure of the town.

Knowing how each social network is used is like having the map of the town.

Once you have knowledge of the streets around town, the next step is to find and connect with your customers.

This is where my last post comes in handy, if you can identify a social consumer online, he or she is more likely to have multiple social networking accounts which can help you to further profile your target audience.

This is especially helpful if you use a CRM (Customer Relationships Management) system such as GoldMine, Dynamics CRM or Salesforce.

Let’s look at B2C (business-to-consumers) social consumers; these are people that are willing to share their personal information on social networks engaging in activities such as updating their Facebook status, displaying their locations on Foursquare, leave their product reviews on Amazon or restaurant reviews on Yelp.

If you apply the Pareto principle or the 80/20 rule, you can expect the power users represent 20% of the users that’s generating 80% of the activities.

Accordingly to the latest study by Chadwick Martin Bailey, “consumers who are Facebook fans and Twitter followers of a brand are more likely to not only recommend, but they are also more likely to buy from those brands than they were before becoming fans/followers…The study also uncovered perceptions among consumers that those brands not engaging in social media are out of touch.”

Facebook_Twitter_consumer

The idea is to focus more on the power users that command influence within the social networks. Keep in mind connecting with “medium” and “light” users also helps to earn social proof and trust via the long-tail.

For B2B (business-to-business) the leading examples are LinkedIn, BusinessInsider, StockTwits, OpenForum by AmericanExpress and BusinessWeek’s BusinessExchange to see how businesses building communities that connects and shares information.

They represent how social network can be utilize to build a community by providing practical value whether it’s a piece of software, platform, resource center or networking destination, they give back in return to what participants put in.

I recommend doing some in-depth research to get useful data on demographics of your target audience.

Then identify the appropriate social network(s) that fits your demographics to go after.

The key to success will be your understanding of how your target social consumers think, act and make decisions.

What and who influence them?

How much research was done prior to the purchase?

What was the second or third option?

social_consumer_decision

Implementing Accountability and ROI

Now that you’ve got your customer profiles and social network(s) identified, what’s next? For businesses serious about ROI (return on investment), it’s time to increase accountability of your marketing efforts.

You can do this by using existing data or the customer insights from your research (profiling, surveys, CRM) to create campaign projections, a realistic goal that you aim for.

Then create a mix of financial and nonfinancial metrics that you NEED to measure, not what you can measure.

This is to help you understand how your marketing activities impact the bottom line and how you can optimize them by doing more of what works and less of what doesn’t.

Make sure you track your marketing cost as well as where the money is coming from to justify true ROI and conduct performance analysis.

How much does it cost to run a local campaign vs. national campaign?

What results are you getting targeting moms instead of kids?

Can you compare the effectiveness of your marketing investments in direct marketing and affiliate marketing?

Share Your Insights

Another great use of these valuable customer data is to share the insights with your customer service representatives, sales staffs, product development engineers, design teams, or anyone that will benefit from them.

If the sales staff knows what words or questions your target audience used most frequently when talking about your product, they can craft a better sales pitch.

If product engineers realize how many different ways people actually use the products they create, they can improve and create better products.

If the design team identifies how your customers come to visit your page and where they clicked, perhaps they can increase the conversion rate on your next campaign.

You can also involve them in the insight generation process to help increase the adoption and with regular distribution of these insights, everyone will take part to improve your business incrementally.

Ultimately you want to have a holistic view of your customer data so not only do you know what they’ve purchased, but also what they think about your industry, how they talk about your brand, and why they react to your campaign a certain way.

Simply put, it all comes down to keeping up with the shifts in how people think and act as well as the technologies used.

If you’re unable to keep up then outsource part of your social media efforts to marketers, consultants or agencies; but make sure you understand the implications.

Here is an short and excellent report on how social media influences paid search by GroupM Research.

The Influenced: Social Media, Search and the Interplay of Consideration and Consumption

The take away: The key to effective marketing communications is to have a solid brand strategy.

It’s indicative that social media must work together as an integrated whole of your brand strategy because your brand lives day-to-day in communication platform such as sales presentations, company brochures, product packaging and now the semantic web.

Synchronizing these efforts assures consistent communication of your brand’s strategy, helping to create brand awareness and recognition of who you are and why you matter.

Moving forward, there will be an increase demand for marketing ROI as more data becomes available and new measuring tools are developed.

As always, focus on the signal instead of the noise, maximize the value of social media to improve your business beyond marketing.

What do you think?

Love to hear your thoughts and feel free to share your ROI metrics.

he study also uncovered perceptions among consumers that those brands not engaging in social media are out of touch. When asked the question “What does it say about a brand if they are not involved with sites like Facebook or Twitter?” they said the following:

Reputation Management Using Social Media

by Eric Tsai

Recently I purchased a new vehicle and was excited about the whole experience. I’ve had many cars in the past and the part that always annoys me is feeling the pressure to buy from the sales people on the floor.

But this one is different.

It was like two friends talking about cars and with no initiation about buying. She wasn’t worry about selling.

Obviously I purchased the car and about 3 weeks later I had to go in for some service and again the experience was painless and I even got a loaner car to drive for a few days.

I was so thrilled that I wanted to endorse them by leaving reviews on their social network profile. Then I discovered a string of negative reviews online and what’s worse is that they received an average of 2 out of 5 stars on multiple websites.

So I called the sales person that sold me the car and she said she will help me pass it to her corporate marketing executive. Below is a slightly altered version to keep both the dealership and sales person confidential:

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Dear Jenny (not real name)

I’m a happy customer because I had a great experience buying a vehicle from you. It was enjoyable and I felt no pressure or that I wasn’t been judged.

When I came in for a service a month later, your service department was superb not to mention I can talk to the technician forever. The car was serviced promptly and the entire process was painless.

With such exceptional service and people, why is it that your dealership only gets

3 out of 5 stars from Google?
2.5 out of 5 stars from Yelp?
3 out of 5 stars from Edmunds?

The reason is simple. No one is managing your company’s reputation online.

People typically would only review something when they’re either excited, happy, satisfied or vice versa; frustrated, angry or dissatisfied. Looking at some of the reviews you will find YOUR NAME is all over the positive side, which is the reason why not all the reviews are negative.

As you can see the negative reviews out weights the positive reviews. Nobody from your company is defending the dealership brand and it’s unfortunate because your car manufacturer makes a product that practically sells itself.

But does your dealership have any loyal fans that would refuse to go to other dealerships because they love you guys so much? Does your dealership have any advocates internally or externally that promotes the positive things about your company?

Does your management care? And what are they doing about it? Is the entire business run on listing cars on websites, classifieds, and print advertising? Then why should I come back to buy my second and third vehicle from you?

There is NOTHING on your website that shows credibility of your great sales people, hardworking service advisers, happy technicians or a sense of strong community. Just bunch of product photos, inventory listing and resources that every other car dealership has on their website.

How can I trust your brand? I only walked in your dealership knowing there is a deal NOT because I know Jenny Smith, the awesome sales person was there. If your dealership competes ONLY on price, then it’ll be very difficult to build value in the business because there won’t be any long-term customer relationship forged that way. And that’s not what your GM wrote to me in his thank you email.

Unless you’re selling a commodity such as water, people don’t buy what you sell, they buy the experience! And even water brands are working hard to differentiate from the competition, what marketing efforts are you doing to differentiate? What reasons are you giving me to talk about your company and your people?

Now, would I recommend your dealership? Sure but I would tell people to ask for Jenny in sales and Kevin in service.

Sincerely,

Eric Tsai

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Reputation Management is Marketing

It should come to no surprise that reputation management is marketing. And crisis management cross over to reputation management as well, thus it should be considered as marketing too.

Take a look at the recent two big crisis for these two brands: Tiger Woods and Toyota. One is a billion dollar personal brand and the other one is a multi-billion dollar consumer products brands.

For Tiger Woods, he opted to go with the silent treatment, laying low to let things wane a bit and the conversation just kept going. Even after his public statement, the damage has already been done, sponsors dropped him and fans still skeptical on his integrity.

With Toyota, it’s indicative that there is no magic solution to fix a fundamental problem on a technical issue on the accelerator. The key is to manage the crisis in a way to mitigate negative press going viral as it did on Twitter just check the #Toyota hashtag.

According to AdAge, “on Jan. 22, the day after the recall, buzz within the social web skyrocketed, with the number of posts about the automaker going from less than 100 to over 3,200. With the stop-sale announcement four days later, online chatter shot from about 500 posts that morning to more than 3,000 by that afternoon.”

In both cases, the respond time is just as critical as what’s been communicated.

As we continue to transition to the social and relationship-focused era, companies will no longer be able to ignore social media and online marketing because the truth of the matter is the more social you are and the more transparency you expose, you’re more likely to convert the sales and retain loyalty.

And if you’re able to provide a community for your fans, customers, staff or even vendors to interact and engage with each other, they’re also more likely to buy repeatedly not to mention providing you with referral business as well.

According to the latest report from Chadwick Martin Bailey and iModerate, “social friends and followers feel more inclined to purchase from the brands they are fans of… 60% of respondents claimed their Facebook fandom increased the chance they would recommend a brand to a friend. Among Twitter followers, that proportion rose to nearly 8 in 10.”

Social Networks Continue to Grow

And it helps that social network giant like Facebook is now just as popular as Google according to Hitwise,”Facebook reached an important milestone for the week ending March 13, 2010 and surpassed Google in the US to become the most visited website for the week… Together Facebook.com and Google.com accounted for 14% of all US Internet visits last week. ”

Just look at the chart below and you’ll see how Facebook have exploded while Google maintains its steady traffic. Why the exponential? For one, Facebook is a great way to get started with social media since most people will already have a couple of hundred friends that they can talk to about anything.

For businesses in the offline world to reach customers they would have to make hundreds if not thousands of phone calls or send out loads of flyers that would cost lots of money and resource. Now companies can do that a couple of times a day for free through a Facebook page or a Twitter tweet.

The take away: All businesses should start exploring with social media to find their sweet spot. Traditional media channel such as advertising on TV, magazines or billboards can still be expensive with unpredictable results. Social media has a low barrier to entry (yes it’s cheap) and allows you to meet people in a fraction of the time that it would take in the real world to start building meaningful relationships.

However; you must factor in the the resources and time spent on social media marketing, because it can get out of hand which can lead to inefficiency and ultimately costing you more.

You don’t even need to have a profile on every social network like Facebook, Twitter or LinkedIn. Simply focus on one that you’re comfortable with, develop a process in which you can implement a systematic approach and see what results you get. If you get the result you like, keep doing it. If you don’t, try something else.

Whether you like it or not, people will continue to talk about your brand and you can either choose to ignore it or do something about it.

The Long Tail of Trust in New Media Marketing

by Eric Tsai

In today’s fragmented media world where we all have some attention deficit in our busy lives, there are simply too many sources of information thus finding a filter that we trust is extremely important.

Most people tend to prefer value, look for key opinion leaders and trust one-on-one communication sources.

Accordingly to a recent “Purchaser Influence Survey” by EXPO provided to eMarketer, over 92% of US mom internet users trust peer review more than manufacturer’s brand information.

This data should not be a surprise because if you want recommendations for a restaurant or suggestions on buying a new cell phone, you’re pretty much going to first ask your friends.

If you’re really serious about the purchase, you will do your “homework” first by reading bunch of online reviews from Yelp to Amazon before accessing your trusted sources.

Thanks to the increasingly social web, everyone can have a voice in their sphere of influence.

As a result word-of-mouth has become the ultimate marketing arsenal for marketers to tap into their loyal customers and advocates to help spread their marketing messages through what it’s called earned media.

Earned Media vs Paid Media

As opposed to paid media where publicity are gained through advertising, earned media usually are from real people, not marketers, which explains why consumers tend to trust them more.

It’s indicative from the survey conducted by Synovate for word-of-mouth ad network PostRelease, over 50% of the word-of-mouth activity was to help a friend or family member with a purchase decision, as well as sharing information they found on the web offline.

While these finding are insightful, it’s simply a confirmation that earned media is what’s working and will continue to lead the way as we crawl out of this recession.

Obviously, there are other factors that contributes to the buying decision that aligns with the “four Ps of marketing” (price, product, promotion and placement), but there is a definite shift in the perception of value that builds on trust.

So how what does trust mean to brands today?

According to the 2010 Edelman Trust Barometer from PR firm Edelman, transparent and honest practices and trustworthiness are extremely important while financial return have fallen below those factors.

One thing I must point out is that these data can be misleading because financial returns actually increased but have fallen behind other factors so there is merely a shift in value perception.

We’ve gone from push advertising to social influence marketing. Online users have learned to focus on content and ignore online banners (banner blindness) simply because display focus too much on getting attention and have failed to deliver.

The concept of getting attention as a way to create brand awareness is being seen as noise which leads to resistance.

People have caught on to the fact that more marketers are increasingly behind influential bloggers, social media rock stars and even popular portals by endorsing their content diluting the credibility of peer-to-peer networks.

Long Tail of Trust

In the ear of new media, brands have quickly learned social marketing is build on the idea that people trust their friends more than they trust authorities, but on the other hand, consumers also start to question the intend and authenticity of their social networks.

As I’ve mentioned previous in “7 Keys to Creating Social Media Strategy for Your Brand”, social proof plays a key factor as a weapon of influence, the challenge for marketers is to earn trust as skepticism remains about how long trust will last.

When it comes to trust and brand loyalty there is no silver bullet, but knowing what value proposition to focus on and how to make adjustments can help marketers to acquire high level of trust over time.

If you truly want to earn the trust of your audience, don’t get sucked into the numbers game.

How many Twitter followers, Facebook fans or Linkedin connections you have on is far less important than how you interact with them.

Instead of concentrating on how many social network participants you have, try instead to gauge success on how engage they are with your brand.

The take away: When it comes to trust, it pays to earn it over time via high targeted more personalized channel that drives engagement and loyalty.

Mass media may reach a wider audience faster but the conversion rate is low and the experience becomes de-personalize.

There is still a place for mass media, but there is growing concerns over the value and ROI in the long run.

Moving forward companies should focus on shifting towards a customer centric strategy that retains long term customer loyalty as a sustainable competitive advantage.

Unless your brand connects with the customer, your chance of earning trust will be slim.

The role of marketing is only going to become even more important and integrated closely with customer interactions.

Get back to the basics in the context of customer feedback.

It should be more about starting the conversation to understand the customer’s point of view in an holistic effort to co-create value that defines your brand strategy.

The Secret to Social Media Communication

by Eric Tsai

Recently a report was released by US market research firm Pear Analytics with a statement on how 40% of Twitter messages are “pointless babble.” As you can see from the comments followed, the statement rubbed some people the wrong.

Although the analysis was based from a personal value judgment on individual’s communication, it somewhat puts Twitter usage in perspective. At the end of the day nobody can speak words of wisdom every time they open their mouth (not even Warrant Buffet), but the real value of Twitter is its openness as a real-time platform for engagement opportunities.

Perhaps the report is subjective but the truth is Twitter has allowed users to utilize the platform however they like propelling this incredible movement towards the personalization of media. Simultaneous to this growing personalization of media is a stronger notion of connectivity in social media. Not just Twitter but all social media technologies must be seen as revolutionary not simply in their design, but in their redesign by people because there is really no rules or limits on how you want to use it including pushing out pointless babble.

Let’s look at some of the ways people are using the social networks that’s been created. According to a survey last month from Direct Marketing Association (DMA), “Nearly 60% of marketing and management professionals in a recent survey think social networking can have a significant influence on their company’s brand awareness… more than 45% of respondents believe social networking can be critical to capturing customer insights.”

Evidently marketers are all trying to capitalize on social media to capture customer insights.

Social media allows you to hear what’s been said enabling you to efficiently abstract more relevant information in developing a targeted marketing strategy. The catch is to draw value to the audience in a meaningful and personal way because the potential for a conversion increases drastically when you target a new audience that is already interested in what you have to say.

Understand the Communication Process: Linear to Interactive to Transactional

Whenever I discuss with clients on how to develop a brand strategy I always ensure there is an understanding of the communication process. Traditional media provides mainly a linear model of communication that’s simply a one-way process where the sender broadcasts a message to a receiver and thus communication and understanding occurs. Think of it as reading newspaper or watching TV, you’re only receiving information.

A more sophisticated interactive communication model was developed via mediums such as talk radio or online discussion forum that allows feedback to transpose over the linear communication model. As a result it builds meaning through feedback but with noises that interferes with the communication. Noise is anything that interferes with the communication of the message with the encoding and decoding process.

And finally there is the transactional communication model that requires the engagement to understand and incorporate individual’s field of experience and frame of reference into the conversation. This is ultimately how to communicate efficiently and effectively. Your audience continues to be engaged because you’ve taken encoding, decoding, receiving and sending feedback all into consideration when you communicate.

Social networks encourage a highly transactional model of communication in which people build shared meaning that assumes reciprocity. The real difference is that you’re not just telling others what you want them to understand, which is the content aspect of our messages, but you’re also conveying your understanding of the relationship you have with them. The conversation becomes more attractive when you can relate to your audience.

Why Brands are Eager to Engage

Unfortunately many brands failed to understand the concept of real transactional communication because they’ve mainly utilize the linear communication channel to “push” their marketing and message. The problem is that it doesn’t allow for efficient feedback. Furthermore what’s been broadcast influence how each and every consumer responds back, and that in turns has bearing on the next marketing message from the brand.

Traditional channels discourage open communication that social media is built on which is why today brands are eager to engage with their audience more than ever with this new platform. It’s like a real-time focus group that can give you practical feedback to improve your product or services (One way to look at it).

It’s indicative that a shift from ambient media into conversational media is underway. You must realize that people’s response has impact on your future communication with them, this is especially important in conversational media so a positive transactional exchange would be optimal.

As social media continues to gain momentum, it’s not simply about building a large following but to cultivate a community in the sphere of trust. Your brand’s actions and perception will directly impact your reputation and brand image. Executed properly, social engagement can serves as a tangible incentive that’s more effective than other marketing tactics in earning trust.

In fact, this is especially crucial during a recession when trust is at all time low and consumers are extremely selective. Today more people are using the internet because the increasingly social web offers more freedom of choice, allows for sharing and collaboration, enables customization of content, delivers cost-effective entertainment, all with on-demand speed.

Transactional communication is the preferred communication method.

However, one key concept brands must recognize is that trust is simply permission to compete, not as a differentiator. In order to become an esteemed brand, you must demonstrate that you understand and care about the consumer as well as having a valuable offering.

The take away: Social media = conversation = transactional communication = meaningful engagement = trust = allow to compete = chance to win lifetime customer.

What do you think? What’s your communication strategy? Love to hear from you in the comments.

How Social Media is Transforming Business

by Eric Tsai

Lately I’ve been researching on how brands are using social media to improve their business.

While doing a bit of thinking on social branding, I recalled a conversation I had with a friend that just launched a web2.0 startup business.

The one advice I gave was to launch it as soon as possible without worrying too much on branding.

The idea is to deploy your initial idea and allow your users to tell you how to evolve the product.

That’s how majority of the new web startups utilize crowdsourcing with an emphasis on the power users then really listen to what they have to say.

The brand development aspect of a startup isn’t as important as the initial user experience.

It got me thinking about business models and how more and more companies are finding it necessary to transform their business model due to the economic crisis.

In addition, the shift in consumer behavior will cause brands to adjust to a fundamentally altered playing field.

In most cases brands will find it hard to transform themselves unless they’ve already got a flexible, dynamic long-term strategy that embraces change.

This means dismantling silo culture within the organization while fostering cross-functional collaboration to spark fresh thinking.

Brands that have this fluid approach are more likely to adapt to change through uncertainty.

Brand Fluidity Creates Advantage

In my previous article “The Emerging Trend of Hybrid Marketing Model,” I pointed out that hypercompetition is no longer allowing businesses to have a sustained competitive advantage, so the idea approach for brands is to have an agile business model.

This happens consistently in the tech industry where every 3-5 years technology evolves and often improves (1.0 to 2.0) leading to a need for adoption.

The key is to stay flexible and scalable because products, services, and business models will evolve over time as knowledge becomes ubiquitous which leads to the path of commoditization altogether.

Just look at the costs of electronics, web hosting, printing, or even internet bandwidth have dropped in price in the past 10 years. In fact, not only are they cheaper, you get more for less even with inflation.

By having an nimble business model, it’s possible to build brand momentum that has relevance in addressing consumer needs.

And relevance is a good predictor of short and long-term success.

However, more focus should be put on proven short-term tactics that aligns with long-term goals.

Short-Termism Is Not Sustainable

The eruption of social media has forced brands to incorporate this new tactical tool as part of the overall brand strategy playbook.

This is indicative of the validity from companies like Intel, IBM, eBay and Wall Street Journal that have moved quickly to publish social media guidelines for their employees.

In a structured brand ecosystem, social media is an unproven short-term scheme because it will continue to evolve as an ongoing, living tool that facilitates real time dynamic conversations.

I’m not denying the success that some brands are having in social media but in general most brands are still trying to figure out the arc of its trajectory in pursing the adequate usage of Twitter, Facebook, LinkedIn, and even blogs.

Brands that quickly jump on the bandwagon without defining the desire outcome are focusing on short-term solutions that are simply band-aids not cures.

Coupled with a lack of attention to the overall strategy, fundamentals, and conventional approaches to long-term value, it’s simply not a sustainable model.

What’s important is to create an unambiguous structure for brand fluidity while maintaining energy and involvement throughout the organization.

The transformation extends well beyond tactics. Brands must become more engaging by being more social, this means building meaningful relationships that resonates with their audience.

Social Media Accelerates Upstream Reciprocity

Every relationship has a purpose especially on the increasing social web. What social media demands is trust and authenticity.

I see it as doing what you promise and be consistent especially in transactional business. In a recent article “Altruism Repays the Best-Connected Individuals” from Technology Review published by MIT, stated that:

Unselfish behavior spreads through society in a way that most benefits the “hubs” in the network.

The article basically illustrated how being unselfish will benefit you at the end because those who have been helped will likely to go on to help others, then spreads through a group creating the upstream reciprocity phenomenon.

There is actually an entire study done with formulas to support the phenomenon and you can go read the “Upstream reciprocity and the evolution of gratitude” analysis from U.S. National Library of Medicine if you like.

I found the information fascinating because it mimics the structure of a social network.

Apply this concept to social media and you’ll realize that you’re the red dot A and everyone else is dots B and C. Imagine altruism can be any form of your direct or indirect influence in social media.

It could be the content on your blog, tweets you’ve answered, or even products and services you’ve sold (ebooks, videos, webinars, web design, copywriting, consulting, etc).

The takeaway is social media accelerates both upstream and downstream reciprocity especially for reputable individuals.

In business, the act of unselfishness is another form of the Freemium business model. And this immediately hit home with me on how social media is transforming the way companies are doing business.

You can no longer neglect your reputation online because that’s where the conversation about you is taking place.

Social Transformation

Social media has evolved to be the hub for instant and viral reciprocation for any organization’s internal structure and external engagement.

The power of its reach and the openness of its platform commands the kind of transparency that challenges your core value proposition.

It really doesn’t depend on the wisdom of gurus or experts for its dynamism.

That’s the primary reason it will almost certainly withstand the “it’s a fed” challenge.

Social media is transforming businesses and it matters.

From Twitter to Facebook and every web2.0 tool in between, consumers are more and more concerned with the integrity and intent of the brands they interact with, while employees are less afraid to expose how companies work internally.

The challenge for marketers is not to merely appear engaged, but to actually be engaged – to live up to the promise and deliver.

I hope this is helpful in uncovering the implications of social media in business, it’s important to identify the fundamentals and rethink the overall picture.

I know I haven’t analyze any of the specific social media tools in detail, but you can simply conduct a Twitter or LinkedIn search to find every possible tactic and how-to’s out there by the so-called “experts.”

Interview with an Expert: Anne Simons of Brandeo

by Eric Tsai

Today, I spoke with Anne Simons, who is the blogger behind Brandeo and the President of TBD Brand Ventures.

In this interview, Anne talks about what brands are doing today to stay competitive, her perspective of social media on branding, and advice for marketing professionals.

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The Evolution of Media Content Distribution: Circulation 1.0 to 2.0

by Eric Tsai

I often get asked on the benefits of Social Media: “How should we leverage social media for advertising and marketing?” or “What do we need to consider when incorporating social media into our existing strategy?”

There are still a lot of questions surrounding social media.

The simple way to get a grasp on it is to first understand how information flows through social media.

Visualizing The Circulation Evolution

I like to visualize information so I’ve created the following graphics to describe how content travels through the traditional media channels.

circulation1_0

As you can see in the traditional model, content gets created (by few sources) then aggregated into the circulation 1.0 channel of print, radio, television, and the web.

These “read-only” materials get pushed out on a one-to-many process requiring users to retrieve them.

Take newspaper as an example: it all starts with the editor creating the content, then it goes through a review process before it gets printed on paper, and finally delivers to you so you can start reading the content.

This is a top-down approach for content distribution with maximum control

Now let’s looks at how social media elevates the content circulation in the 2.0 model.

circulation2_0

In this model, everyone is a content producer enabling user-generated content to scale efficiently.

When you have millions of people contributing content, it creates a many-to-many race to publish and distribute information.

As a result, the content now comes to you, pulling you to consume.

In addition, the nature of web 2.0 allows content to be syndicated and shared almost instantaneously.

Finally let’s incorporate circulation 2.0 as part of the circulation 1.0 and you get the “hybrid” model:

circulation1_5

I call this circulation 1.5 because it retains the traditional media’s channel of distribution while adding web 2.0 into the mix.

The concept is to leverage the best of both worlds from 1.0 and 2.0 to gain maximum impact for brand exposure and brand awareness.

Beyond Circulation 2.0

Most brands are still on circulation 1.0 networks and many are on the path to circulation 2.0 by adding social media to their traditional media channels.

The great thing about circulation 2.0 is that everyone is pulling your content creating a natural word-of-mouth marketing that’s pervasive.

However, as the speed of these dynamic conversation becomes even more instantaneous, in the case of Twitter, the content producer have less control.

Content can get interpreted out of context and then passed along down the line just like that telephone game we all played in kindergarten.

This is why many companies are using social media primary as a service function for reputation management and customer support.

That’s exactly what Zappos, PizzaHut, Intuit, and Dell have done by leveraging Twitter for those purposes.

This creates transparency and adds authenticity to the brand which is where social media has taken us to so far. Moving forward brands must rethink the intend of their products and services and manage expectations carefully through positioning and messaging.

After the financial meltdown last year there is a lack of trust for brands and a definitive shift on perceived value.

That’s why there is such an acceleration in social media because people demand to know the truth and in many ways social media allows us to get closer to what really is happening.

When Twitter was first launched in July 2006 (happy 3 year birthday!) it was intended to be a quick update for your groups of friends.

Today it has evolved to a social networking tool to report, react, and discuss anything from news to random thoughts.

It will probably continue to evolve because of the fluidness of the platform has allow users to take the service in completely unexpected directions.

Now that’s good for innovation, they just need to figure out a business model for monetization.

The fact is traditional media still reaches far more audience than social media as I write this post. I’m sure I’ll circle back in the future as things may change in unexpected ways too.

Let me know what you think.

5 Easy Steps to Build a Solid Social Media Profile

by Eric Tsai

Whether it’s your business or your personal brand, people always connect with people on a personal level. It’s all about engaging in a dynamic relationship.

Brands are not logos or commercials, they are the perception and emotion of people built on trust and credibility.

A successful brand cultivates extensive user experience and encourages interaction that creates meaningful dialogues.

In order to foster strong relationships you must be trusted. And to earn trust, you need to allow others to become aware of you.

This concept also applies to the art of social networking, particularly with the shift from face-to-face communication to more online communication.

There are literally thousands of social media websites on the internet with hundreds more popping up every week.

The strategy is to focus on the ones that suit your niche.

Setup a blog

I recommend setting up a blog if you don’t already have a website.

Even if you have a website such as your company or product website, incorporating a blog will enhance your online presence because blogs are typically search engine friendly, and they allow for rapid content indexing on the internet.

You can easily sign up for a free account on Blogger, WordPress, or TypePad and start blogging away on whatever topic you want. It’s not required that you have a blog but it provides another source to learn about you or your company on a personal level.

The latest phenomenon is the development of ‘micro-blogging” – a form of blogging that allows users to send brief updates either to be viewed by anyone or by a restricted group which can be chosen by the user.

This feature is available in Facebook and LinkedIn as status updates and by far the most popular one now is Twitter.

Sign up social networking accounts

For professional and business related social profile, the ideal website to use is LinkedIn. LinkedIn is a professional community that shares your credentials in a resume format.

It has an unique format for users to browse and connect with a person’s and all of his/her contacts.

You can aggregate your blog content right on your personal profile page too so whenever you post new entries, it will update automatically.

And for connecting with family and friends, Facebook would be the choice because it focuses on displaying photos and allows for more personal dialogues and interactions.

Both LinkedIn and Facebook has a “groups” function that lets you create, join and interaction in sub-communities of your choice.

You can create a group for your company so all your employees can join, or if your hobby is photography you can join a photography group.

This feature encourages networking and brings liked-minded people with simliar interest together.

Follow the 5 steps below to learn how to build your social media profile:

1. Register your account

This requires a username, email, and password. It’s important to use the same username and email across all social media websites so people can search for you if they’re already connected with you in another websites.

For business profile, use your company name, for personal profile go with your real name.

You can use an alias if you like but keep in mind you need consistency and recognition.

Registration process should take no more than a few minutes.

2. Input the right information

Privacy is a priority in social media so typically there will be settings to manage your privacy such as opt in to receive updates, newsletters, or allow/disallow certain information about you to be exposed in the community. If you’re not sure, test it out and play around with the settings until your satisfaction.

3. Add your immediate friends and colleagues

Once you’ve setup an account, take a few moments to search for your family, friends and colleagues and add them to your network.

People gravitate towards popular names and like to know that you’re not the only friend they have, it’s a simple perception of social proof.

4. Search for people you like and study their profile

– After adding everyone you know that exists in the social network, it’s time to search for new connections.

This is a tricky task because just like email spam, there are lots of spammers on social network sending unsolicited messages.

If you are a fan of someone or want to get to know them, the best way is to build up your profile so they can review then decide if they want to connect with you; or you can get introduced through one of their existing connection.

Either way, you need to study their profile and have valid reasons to be part of their network.

This applies to groups as well, and most social network groups require the group administrator to approve your request to join.

5.Participate, contribute and share

– After you connect with someone you can receive updates on that person via the status update feature.

This allows you to participate in their conversation, add comments, or share your updates with them.

The key is to build and maintain common ground by bringing value to the conversation.

Interacting with your friends with comments like “good job” or “I like it” is fine but not in the professional communities where preeminence and expertise are realized.

You must demonstrate your value in those professional forums to optimize your social profile.

The Unspoken Rules Of Social Media

42-17678818 The following rules are self-explanatory and will take you a long way.

Do’s:

Do speak your mind and contribute
Do bring value to the network
Do share and learn from others
Do keep in touch

Don’ts:

Don’t just focus on yourself
Don’t be afraid to ask
Don’t abuse social networking relationships
Don’t use social media to spam

Many businesses use social media as a part of their marketing strategy while others enjoy the experience for personal reasons.

Focus on your desire outcome and try to have fun too. There are plenty of opportunities to build your rolodex by embracing this new tool.

Have you started your social media journey? Connect with me to discuss more.

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