Category Archives: 7. Social Media

Marketing Trends: Public Relations Budgets going Social?

Sudden stormI haven’t been up for air in weeks. Somehow, despite the economic downturn, despite the nuclear winter in venture capital markets for early stage startups, SocialRep is humming. I’ve been buried in social media tracking scans for customers and prospects, and new inquiries are coming in over the transom. I’m also excited about an invitation to present at Thunderbird’s Winterim in New York in January, where I’ll be talking about our emerging framework for integrated social media marketing and technology. So how can I account for the uptick in energy despite the gloomy market? I’m starting to see my theory about natural selection play out.

Over the past couple of months, SocialRep has been tracking a massive swath of online dialog about marketing. Not surprisingly, the trends in dialog are overwhelmingly focused on the impact of the economic downturn, with various flavors of speculation, panic and punditry. Some examples:

  • A few weeks ago, various reports on budget planning for 2009 highlighted a marked migration in marketing spend from traditional to digital media. The nearly universal read on this move is that online marketing is more measureable than offline, but there was surprisingly little citical analysis of  the challenges with online metrics, and how those challenges are being addressed.
  • As the economic crisis deepened, the panic did too. Sequoia Capital stoked the flames with a presentation they posted online telling their entrepreneurs to “get real or go home”. The presentation went massively viral, spreading the talking points for belt tightening and death pool speculation for various startup sectors, but few specifics on the tactics companies should pursue to refine their market approach.
  • As if in response to the panic–and mindful of the bloodbath marketing usually suffers in a downturn–marketing pundits took up the mantra that, whatever you do, DON’T STOP SPENDING. Some (myself included) cited the anecdotes that companies like P&G, Kellogg and Chevy increased ad spending during the Great Depression and pulled ahead of competitors. But most simply pronounced the incantation forcefully, that smart companies don’t cut marketing, but didn’t offer specifics on how companies should adjust their programs. Jonathan Baskin called this trend perfectly.

Notice a pattern here? Lots of punditry and trend analysis, but very few specific recommendations for how companies should adjust their marketing programs to deal with the economic crisis. There were a couple of exceptions, most notably a lot of dialog about the dangers of discounting and how price cuts undermine brand equity. But in terms of substantive recommendations for adjusting marketing strategy and operations, not so much. So I was interested to see a tangible sign of how some companies are adjusting based on the sudden increase of inquiries at SocialRep.

~  free  ~We’re still in the early stages at SocialRep. After beating the streets for Series A funding over the summer, we read the tea leaves and readjusted to focus our energy on customers and product. In this market, we’re going to live or die by our success in serving customers, not VCs. But bootstrapping a technology company can be tenuous. You need customers, but if you’re too opportunistic and grab at anything you can drag over the doorstep, you’ll quickly fragment your product and team by trying to be all things to all prospects. So you have to be deliberate in choosing customers, which means being a little more slow and quiet than would otherwise seem prudent. When you find a good market vein, you mine it, and pay close attention to the way your prospects frame the problem they want you to solve.

What surprised me was the sudden influx over the past few weeks in the number of companies that found us, and how they framed their interest in our social media offering. The common refrain was that, in the face of an emerging recession, these companies were aggressively reviewing every dollar of their marketing spend. One area in particular was not standing up to scrutiny: Public Relations. These companies complained about spending 5-figure monthly PR budgets on activities that produced activity without results. The mandate these companies had been given was to take the PR budget that was not performing and invest it in something innovative, like social media marketing.

Silencio!!! by Loud VillaNow I know this will provoke some howls, so let me make a preemptive disclaimer. I believe in PR. Or, I should say, I believe in good PR. And having spent 15 years on every side of PR, I can define the difference between good and bad PR. Years ago, when I was the editor of a magazine, my inbox overflowed every day with pitches and press releases that had absolutely no relation to what my magazine covered. Today as a blogger, I still get totally irrelevant PR-spam, more artfully framed as “blogger relations”. This is the lazily “scientific” ethic of bad PR: blast a fire hose of pitches and press releases at everyone that looks like they might be a journalist or blogger, and hope someone picks up your story. In the place of actual stories that influence the market, this approach produces monthly “activity reports” and media mentions in off-the-beaten-path blogs or news feeds.

Good PR is different. It’s about relationships and market expertise. PR companies in this category take the time to hire and train smart people who get to know a market, the competitive landscape, the products, and of course, the analysts, reporters and bloggers. They don’t spam their contacts with press releases; they build relationships based on sharing knowledge and insight. Reporters and bloggers answer their calls because they know their time won’t be wasted, and they may get an important tip. This kind of PR produces relevant stories that influence markets.

The problem is, the ratio of good to bad PR is not good. And even among the better PR companies, an understanding of how to manage the dramatic shift from traditional to social media is still largely predicated on the notion of cultivating asymmetrical influence more than reciprocal dialog. Moreover, few traditional PR companies have the culture to passionately embrace the tech-driven social media paradigm. So in the face of a market downturn, when belts are tightening, we’re seeing companies looking at the money poured into PR, and deciding that now is the time to try something new.

What does “something new” look like? That’s the topic of my next post. In the meantime, here’s a hint: social media marketing is just like PR, in the sense that there’s “good” and “bad” SMM. And the distinction is based largely on the same dynamic–activity vs. results, influence vs. relationships.

Beyond Monitoring: Managing Social Media Engagement

I gave an in-depth presentation yesterday at the BrightTalk Social Media Summit on the state of social media monitoring and engagement management for enterprise marketers. This is essentially a view of the business landscape from the perspective of SocialRep. It’s an hour long presentation, but I guarantee that if you’re an enterprise marketer, you’ll find it worthwhile. If you’re not sure about spending the time, fast forward to someplace in the middle and listen for 5 minutes.

The Natural Selection of a Market Recession

A couple of weeks ago I wrote about the financial crisis and its likely implications for the business of marketing. Beyond the direct comments on my blog, I got a lot of bemused and even dismissive comments by email. At the time, the Web2.0 conference was in full swing in New York, and most of the chatter was around exciting new technologies, not so much about the stock market. What a difference a couple of weeks makes. We’ve had some collossal bank failures–WaMu and Wachovia–a major battle over a $700B Wall Street bailout, and the single largest one-day drop of the stock market, more than 9%. That’s just the surface stuff–not getting into interbank lending rates, Fed liquidity, foreign capital flight, etc. This week I’ve heard direct news of the ripples hitting my own industry with discrete layoffs starting in the advertising and digital media space.

All of this, of course, is only symptomatic. The really troubling news hits much closer to home. As many of you know, I’m running SocialRep, a startup in the social media monitoring space, and I depend on sales, credit and investor funding to keep the business accelerating down the runway. In the past 2 weeks, one of my major prospects, a company in the financial sector, went belly up rather suddenly–eating up weeks of energy, investment and travel to close a deal. Many of my other prospects are visibly slowing their spending–holding back on any outlay of cash until they can see where things are headed. The limit on one of my credit accounts was cut back, leaving me a lot less breathing room. On the VC front, the impact is also evident–even though VCs have funds, they’re slowing down and being more careful in their investments, waiting to see who has what it takes to survive a downturn. Yesterday, as if to emphasize that this is rapidly spreading to mainstreet, McDonald’s announced that financing from Bank of America for franchisees to improve their restaurants had been capped by BofA in the wake of market events.

These are all serious signs of a market slowdown that goes way beyond Wall Street–right to my own front door. When banks stop lending and credit dries up, it’s like running out of gas. But despite the growing stream of dire press accounts of what’s happening in the market, I still don’t see any sign that the vast majority of people realize how serious this crisis has become. But relatively speaking, it’s still early in the cycle.

I didn’t write this post to spread doom and gloom, although I am convinced that we’re in for a proverbial Correction of epic proportions. The point is, this is all part of the cycle. It’s the nature of systems–part of the very process of organizational advancement and evolution–and many of the most important transformations of social and economic systems can only happen through disruption. The larger the disruption, the greater the capacity for fundamental change. Everywhere you look where we try to control and minimize the natural cycle of systemic disruption, we wind up only delaying–and often increasing the magnitude–of the eventual, inevitable disruption.

The SunThink of forest fires. We spent decades trying to control and minimize forest fires–Smoky the Bear!–only to discover that we were inadvertently causing a massive buildup of dead underbrush and fuel, making the eventual, inevitable forest fire far more powerful and destructive than the smaller fires that used to happen more frequently.

We’ve done something similar in our economy. We’ve leveraged our assets through credit to unnaturally extend and sustain a supposedly endless cycle of prosperity. We used equity and credit to go beyond our paychecks to buy lots and lots of stuff, and the economy grew unnaturally–like some genetically engineered 1000-pound pumpkin. But we leveraged ourselves out over thin air–housing prices. And when we finally reached the headwinds that pushed prices down, the whole thing began to unwind. If you don’t have any more equity and credit to buy lots of stuff, the economy slows down. But it’s worse than that, because now you have to divert your paycheck from buying even the important stuff to pay down the credit bill, so the economy stalls even more. That we’re seriously floating major legislation to try and prop up the underlying housing prices and credit is not surprising, but it’s not comforting. The bill is necessary to prevent markets from seizing up entirely, but many of the provisions are laughable. It’s as if we’re saying, uh oh, bigger fires? Let’s clone an army of Smoky the Bears, and stop fires once and for all. The whole premise is simply not credible. The decline, the disruption, however painful it may be, however we may be able to attenuate some of its worst effects, is a natural part of the system. Not only can we not avoid it. We literally can’t grow without it.

Once you understand that reality, get past the denial, you have a clearer view to what it takes to survive and even thrive in transformational chaos. Speaking dispassionately, the role of disruption is to challenge the system and eliminate weaknesses–to burn out the deadwood and disease. Once that happens–assuming the system wasn’t so diseased that it collapses entirely–there’s an opportunity for reorganization and redevelopment, an advancement to a higher order of organization.

From an American perspective, we have seen this cycle play out in marketing for well over a century. Some of the cycles of disruption and reorder have been dramatic, some more subtle. We’ve seen marketing evolve through cycles that defined marketing by distribution, merchandizing, personal selling, mass markets, mass media, branding, database marketing, internet marketing and most recently social media, just to name some of the most obvious transformations. Some of those cycles were driven most by innovation–radio, TV, computers, networks–others were driven most by disruption–two world wars, the Great Depression, regional wars and countless smaller recessions.

I watched this cycle play out directly during the Dotcom boom and bust when I was president of an agency in San Francisco, and I’m anticipating that we’ll watch it all play out again, but this time on a larger scale, with greater disruption, and with greater impact on the reorganization of marketing as we rebuild. The cycle is predictable, but it’s not orchestrated. It happens through a process of natural selection, driven primarily by short term business objectives. So here’s my 2-cent prediction on the mechanics of this correction. I’ll leave the higher level analysis for a future post.

The first obvious indicators of the cycle accelerating will be layoffs. But companies are already starting to feel the liquidity squeeze, and their first response will be to hold off on any new expenses. This will ripple out and return as a drop in orders and an increase in selling cycles, making the liquidity crunch tighter. After cutting programs, the more aggressive companies will start layoffs. Layoffs ultimately will disproportionately affect marketing, as companies focus more intensely on short-term sales efforts. At this point, we’ll see a large number of senior marketing executives and managers retired–they’re expensive and their contribution is more strategic than the short-term, closing-deals imperative. Marketing will be redefined functionally as sales support and lead generation, and marketing directors will take over the day-to-day reins. Most companies will retreat into this relentlessly sales-driven mode until the bleeding stops and markets stabilize.

Emerging Beauty
At this point, the natural selection shifts from who and what gets cut to who and what gets selected for new growth. Companies still have to compete, and they’ll look for ways to gain a market advantage. The focus early on will be all on demand generation. Marketing directors who have grown up with technologies will explore emerging tools that improve lead generation and campaign performance. Vendors and startups who weren’t overly leveraged before the drop will aggressively innovate new technologies to feed the hunger for cheap and efficient lead generation. But all of this will happen against the backdrop of a new, accepted foundation of social media technology. All of the Web 2.0 hype will have long since burned away, and the useful stuff–the components that help companies connect more effectively with customers to provide the products they want and need without all the bloat of inneficient product development and promotion.

This, ulitmately, is the evolution imperative that will be at the heart of recovery. An evolved paradigm of media–no longer a fight between broadcast and social–but an integration at the foundational level based on what allows successful businesses to advance. It won’t happen by design. It won’t happen by chance. It’s the natural direction of the system, and the massive disruption caused by the financial meltdown is only the catalyst.

I’ll write more in the coming days about why I’m so convinced social media is going to be woven into the fabric of the new marketing infrastructure. Suffice to say that it’s not “true belief” on my part. I’ve written and spoken about this in the past, that the media paradigm we’ve known all our lives and accepted as the norm is in fact a bubble that is bursting. The historical status quo has always been word-of-mouth. Technology simply evolved in a way that disrupted the status quo and put control in the hands of a few, primarily because of the expense of technology-based communication. But technology is now commodity. Communication has returned to a higher level of democratization. And now we’re seeing the media bubble burst, right at the same time we’re seeing a more acute economic bubble burst along with it.

Generating Leads With Social Media

Note: I originally posted this on I’m reposting here because I can better control the flow of data into my Facebook group for MotiveLab. This is an emerging and controversial discussion about the reshaping of traditional marketing that I’ll be discussing on Facebook. My first volley, below, has been followed with a very different view which will be posting on SmartMarketers shortly.

Generating Leads With Social Media

For all the talk about social media—blogs, podcasts, wikis, forums—the majority of marketers I talk with are still uncertain about how to apply social media to their lead generation efforts.

In too many cases, social media initiatives are funded as pet projects—a sudden itch from on high that needs to be scratched.

These are real quotes:

“We have to have a viral video piece on YouTube ready for our customer conference.”

“Our competitor has a new blog, and we can do a hell of a lot better.”

“Our CEO wants us to start podcasting.”

Now, I’m all for innovation. Whatever it takes to get the ball rolling. But I can count on the fingers of one hand the marketers I’ve spoken with recently who are aggressively and systematically applying their knowledge of lead generation fundamentals to social media. That number needs to grow. So let’s dig in a little and talk about social media in the context of applied marketing and lead gen.

If you’re new to the social media discussion, the first thing to understand is that social media signifies a big shift in marketing. What you used to call a market, or a market segment, is now a networked customer community. Attitudes are no longer driven by your carefully crafted message, blasted relentlessly through a series of channels to gather 1.5% response. The internet makes it easy for people to connect and share information, and they know there’s a lot more value in learning about products from others like themselves than from marketing campaigns.

What this means is that markets are increasingly driven by content, conversation and community. Instead of flooding the market with pick-up lines, you need to listen, engage and catalyze your customer community. If you do it well, if you have something of real value and interest for your market community, they’ll spread your message for you.

The best place to start is by finding out where your customer community is already connecting to talk about your market, and who is influencing the conversation. You can begin by using some of the many new tools focused on searching through social content. You can search social bookmarks for keyword concepts related to your market on or Ma.gnolia. You can search for recent blog postings on Technorati. You can search for news items related to your market that were highly rated by web users at Reddit, Digg or Sphere. And when you’re ready to start seriously tracking the flow of conversation and the impact of key influencers, you can check out tools like Buzzlogic and Factiva’s Reputation Intelligence.

Once you know where the conversation is happening, the best thing you can do is to spend some time just listening. What are people talking about? What issues are driving the discussion? If you have something meaningful to say, then jump in. But get engaged as an interested participant, not as a product shill. As a useful analogy, think of your market as a dinner party. Imagine your attitude toward someone who butted into a conversation, talked about how great he was for a few minutes, and then walked away to barge into the next conversation. Unfortunately, that’s the impression many marketers are making today as they trawl blogs, dropping self-serving comments and then disappearing. Communities are much more welcoming to people who have something interesting to say, are authentic, and take a genuine interest in the people around them.

When you’re engaged with one or more of market communities, lead generation programs start to define themselves. You’ll know which community hotspots are attracting traffic and what content is relevant. A lead gen campaign for a bike company at MySpace, for example, might focus on leveraging a big personality like Lance Armstrong to attract friends and drive links. A campaign at Mountain Bike Review Forum, with 60,000 dedicated cyclists, would be more product focused, maybe organizing a demo ride. The program you put together should be designed to fit the community, and you’ll only know how to do that if you’re engaged.

At any existing community where you want to generate leads, it’s important to understand and respect any policies about commercial campaigns on their networks. Some communities will have opportunities for sponsorship, or co-branded content, while others may have specific prohibitions against direct response marketing. If you’re just interested in testing the waters to see how a community–particularly a large community–might perform in a broader campaign, you can often buy banner ads or adword campaigns that focus on particular sites so you can test the interest in program concepts.

When you are well oriented to your market community, campaign execution will look surprisingly familiar. It’s still important as ever to have a compelling offer, a clear message, and to test everything you can to continually improve effectiveness. The difference today is that you need to be much more transparent, honest and accountable in the ways you engage your market. Prospects aren’t just individual "targets" to pick off like sitting ducks. They’re members of a community where word travels fast.

Next time, we’ll look at some specific types of social media lead generation programs. In the meantime, I’ve written a Marketing Brief detailing 12 Essential Tips for Success in Social Media. It’s free and only requires registration. Wait a minute. Am I trying to generate leads on this social media site? You bet.