Some days, it seems like everyone’s talking about the marketing potential of Facebook, Twitter, YouTube and assorted other social media. Unfortunately, they’re rarely saying the same thing. Earlier this year, GM withdrew $10 million in advertising from Facebook, griping that its campaign wasn’t contributing to car purchases. Shortly thereafter, Ford reported planning to spend more than 25 percent of its advertising budget on digital advertising this year, enthusing to Forbes that its Facebook marketing improves the company’s image among buyers and builds advocates for its brand. Coca-Cola also jumped into the debate, announcing that it currently spends more than 20 percent of its advertising budgets on digital and mobile platforms in markets like Japan, South Korea and Scandinavia.
So who’s got it right? Recently, Chief Executive had the opportunity to put that question to Hill Holliday CEO Mike Sheehan, whose career path as an award-winning copywriter and creative director led him to the corner office of the cutting-edge marketing firm. While Sheehan stopped short of calling GM out on its decision, his answer supported the opposing strategy—and offered three points CEOs may want to keep in mind as they struggle to gauge the potential of social media as a sales and marketing channel.
Recognize the Power of Peers
“When I look at the big, overarching picture, we live in a world today where consumers have great distrust of institutions, such as government and big companies,” he says. “That was also true in the ’60s—maybe it’s cyclical—but now you couple that with the fact that the access that people have to peer-to-peer influence is so much greater. People now rely a great deal more on those conversations.”
In addition to heightened skepticism, that shift is partly due to consumers being far less likely to sit through what Sheehan describes as the traditional “crop dusting” marketing method of yore. “In the old days—six, seven years ago—you would get up in the plane and dust the crops,” he says, referring to marketing campaigns that centered around creating a big idea for a brand and spending money to promote it on television and radio. “Now it’s more like going after every single plant one at a time and putting a little fertilizer next to it. It’s a different world. But it can be far more effective.”
Yet companies are still struggling mightily to gauge the potential of social media as a sales and marketing channel—let alone realize that potential. What, exactly, is the value of a million likes on Facebook? At this point, the answer remains murky, concedes Sheehan. “That’s where digital properties really need to spend their time, because advertisers are really comfortable with the metrics of television, radio and print,” he says. “They know how many eyeballs there are, and they’re very comfortable justifying the cost of a $3 million Super Bowl spot. That is, by the way, the cost of a single 30-second spot—which is about a third of the cost of the entire campaign GM pulled from Facebook.”
Such metrics are not yet available for the still-developing social media-marketing sphere. In the meantime, however, CEOs and their marketing gurus can’t afford not to explore the potential of social media marketing. “We know from research that when customers engage with your brand or your product by choice, the impact of that engagement is far more effective than the traditional kind of engagement,” Sheehan notes. “Since choice-based engagement is far more powerful the question becomes how do you weave yourself into the conversation that people are having during their daily lives to make them choose to engage you?”
Consider Starting in the Middle
One entry point may well be the places where traditional and new media intersect, such as social television, where people are watching television and simultaneously engaging in digital media exchanges about the television show or commercial that they’re viewing. Just as criticisms and praise flew across the Internet during the recent political conventions as each speaker presented, loyal viewers of popular shows like The Newsroom, American Idol and True Blood are commenting on what the actors are wearing and products in the ads they see as they watch their favorite shows.
“We call it the second screen—there’s the TV screen and there’s the iPad on their lap,” says Sheehan. “CEOs really have to figure out what they’re doing in the traditional world of advertising and how that intersects with what’s going on in the digital world.”
In addition to the opportunities such intersections may offer, companies can also mine valuable customer feedback from such exchanges. “One of the great things about digital media is that you can find out what people are saying about your company, your brand, your product, all the time,” points out Sheehan. “It’s amazing how many companies, still to this day, don’t dedicate resources to finding out what’s being said about them out there. So start there—with finding out what is being said about you, and then figuring out how to deal with it.”
For B2B companies seeking to provide added value or garner customer feedback, social media can offer a great forum for engaging with and learning from with customers—and for allowing those customers to interact with and learn from one another. “You can create communities of customers for a particular product line and use them to distribute content that engages them and to allow them to dialogue back and forth,” says Sheehan, who points to Home Depot’s contractor customer base as one such community.
Be True to Thyself
Social media feels so foreign to some CEOs that they look to delegate digital marketing efforts entirely. This can be a mistake, warns Sheehan.
“As a CEO, you have to be involved,” he asserts. “Advertising works best when it’s reflective and fits like a really good suit on the CEO. It has to reflect who you are as a person, your belief system and your respect for and knowledge of your customer. So before you sign off on it, you better feel comfortable with it. You’re doing nobody a favor by signing off on something you’re not comfortable with.”