Social Media and leveraging the Pareto Principle

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You know it as the 80-20 rule but it’s really called the Pareto Principle. Who cares? If you’re in marketing, you should, because it shows up in many market categories. From CPG to apparel, for many companies, the 20% that are their best customers make up a significantly larger portion of that company’s revenue and profits.

These few are a brand’s elite customers. Not necessarily defined by purchase frequency, they are nonetheless the most passionate. Even brands in categories you wouldn’t expect people to get passionate about have a discreet set of obsessive customers who are indeed deeply engaged. A recent article in the Harvard Business Review called Make Your Best Customers Even Better drove this point home convincingly so I will spare you the substantiation here.

By the time I finished the article though, I had a nagging question in my mind. Why do so many brands target their primary “consumer engagement” tools (e.g. social media efforts) at the widest audience possible? Actually, I have an answer; I think it’s because most marketing still operates under the influence of mass media thinking where quantity is the holy grail of ROI. When you’re spending big bucks on big media, you want the most bang you can get. What’s your reach, viewership, readership, circulation? Those are the first questions out of every media planner’s mouth. It’s not surprising then, that as marketers started dabbling in social media – and social media started grabbing users in the millions –  the conversation naturally drifted toward these familiar drivers.

But if a company’s best, most profitable customers are an elite subset of the whole…

…and a company that engages this subset well has the best opportunity to turn them into vocal evangelists…

and vocal evangelists are the most powerful marketing force (in terms of persuasive capacity)…

well, isn’t there some wisdom in thinking about how at least part of a social media strategy might be aimed exclusively at this subset?

Yet I find very few examples of this. Most social media activity is open for everyone and a company’s best customers are treated more or less like average customers in terms of access, opportunities and incentives. They all count as fans or followers. They all see the same posts. They all get the same opportunities to enter the same sweepstakes. In essence, the brand foists all the responsibility for being a “best customer” on the customer without providing much incentive – from an engagement standpoint – to do this.

Why wouldn’t you have a separate, secret, member’s only Twitter account for customer service at this elite level?

Why wouldn’t you invite a select group of your best customers to participate in a closed Google hangout to talk about new product ideas?

Why wouldn’t you make some tabs on your Facebook page accessible only to the elite few with the proper credentials?

There’s nothing like a nightclub with a long line outside to stir up demand. In fact, scarcity is one of the most powerful persuasion drivers (which is why, for example, perfume bottles are small – the size makes them seem more precious, valuable and desirable). So why aren’t more companies creating special, exclusive programs instead of just running another hum-drum promotion where everyone gets the same coupon and a whack at the same mid-range prize?

These middle-of-the-road, ione-size-fits-all, everyone-is-invited activities tend attract a different kind of “best customer” – the pro-am sweepstakes player. This person is at the exact opposite end of the spectrum for those highly-engaged true brand advocates. These professional sweepstakes – and you might be surprised how many show up in the server logs of big promotions – are the ones who sets up multiple email accounts and play as many sweeps as they can in a day. Just like the marketer who views the internet as a mass play, they are all about the quantity of games they play because they know that the more often they play, the more likely they are to win. And given how easy it is online to create tens or hundreds of identities, playing the numbers isn’t even all that much work.

These people represent the worst possible outcome – someone who participated in your marketing tactic with no real interest in your brand, your message or your value proposition. They get their information from websites like SweepsAdvantage.com. You were just one of 50 sweepstakes they entered today. These people skew your data. They make your vanity metrics seem high, yet represent nothing more than a fleeting, dispassionate transaction dressed up in the often-inaccurate lexicon of social media: friend, fan, follower.

For my money, I’d say its worth peeling off a piece of your social media budget and investing it in a program for the people you know not only buy your brand, but love it and even try to sell it for you on your behalf. Doing this means treating them as the special subset they are. And leave everyone else out.

Are agencies really leaders in differentiation?

img_544790f5a1228d8So I was doing some research on how marketing agencies market themselves, today. I started grabbing screenshots of each agency’s home page. It became immediately clear that 90% of these sites were almost entirely the same. In fact, quite a few looked like they used the same template.

Every agency wants to be a hot shop. They want to be bought and not have to sell so much. Therefore, as a passive salesman, an agency’s website has to work hard because chances are, before a prospective client picks up the phone or decides to invite an agency to an RFP, they’re going to look at that agency’s website.

An agency’s website is essentially its packaging. Have a look at the slideshow below. Imagine all those packages on a single shelf at Agencies R Us. Could you tell the difference at a glance?

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From the prospective client’s point of view, what these sites say in aggregate is

Agencies all have good creative, mostly presented as video.

Agencies all have cool people with short, pithy bios.

Agencies all win awards, get press, and make some news.

Maybe that’s all there is. Maybe the entire marketing industry – despite all its strategy and analytics and tools – is a parity offering for which the only decision drivers are which creative you like best. That’s the unspoken logic the website designs are operating under. It should also be a warning flag.

Agencies have lamented for years that they are no longer invited to the strategic table the way they were back in the 70′s and 80′s. Looking at their websites, it seems like they’ve resigned themselves to being execution companies.

The ironic thing is that most agency strategists (and agencies keep them in their ranks, despite not selling the discipline very much) would look at an industry like our own, saturated by competitors with little differentiation, with downward pricing pressure, and recommend someone disrupt the model entirely. Books like Blue Ocean Strategy have been written about exactly this. Yet the ad industry – despite a few efforts like Victor & Spoils (whose website, incidentally, looks like all the ones in the gallery above) – really hasn’t had much model-level disruption.

Conventional wisdom says most industries have wholly reinvented themselves – and I mean fundamentally in terms of operations, logistics, supply chain, revenue model – in the past few decades, yet marketing firms still operate similarly to how Bernbach’s did forty years ago. Sure, the tools are different and the turnarounds are certainly accelerated, but the model isn’t altogether different – account manager, art guy, writer guy, production people, media plan, creative brief, revision rounds, billable hours…

Maybe that’s the problem? Maybe we marketing firms don’t heed our own advice, and we’ve organized our entire sales pitch around “who we are” and “what we do” rather than around our customers.

Or worse, maybe we’re afraid of our own advice. Maybe this is how some clients feel when we sit down and pitch them something high-risk, high-cost, with a hard-to-project return on investment.

We always try to sell good marketing to clients under the argument, “If it makes you uncomfortable, it’s probably the right direction.”

But behavior has always been a better barometer of conviction than statements, boasts and claims. So given the lack of differentiation among our own competitive set, I have to wonder how much we really believe what we’re selling.

Why are you not capitalizing on narcissism?

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Oh Buzzfeed, I hate you. I hate you because you transact in dreck. Your content is essentially junk food and in a world with so many problems I really wish you’d turn your talents to something redeeming that made a difference in the world. But I don’t expect this from Cosmopolitan so I guess it’s unfair to expect it of you.

I also admire you. You’re very good at what you do. In fact, you’ve rediscovered something that Cosmopolitan learned several decades ago: There’s a whole lot of business to be built on feeding narcissism.

Lately Buzzfeed has greatly increased the number of “which ________ are you” style quizzes. These are a straight-up lift of the old Cosmo Quiz tactic which I recall girls galore spending time doing back when I was in college. And why not? Its as fun as having a tarot card reading. Who doesn’t want someone to tell them something about themselves, especially when that something stands to make them look cool, interesting or alike an object, entity, celebrity or even animal that that person already has an affinity for?

And of course, this being the age of “share everything” who doesn’t want to trumpet to their friends the outcome of these quizzes?

This quizzes are obviously superbly popular. I know this not only from my own Facebook feed but because Buzzfeed is doing quite a lot of them. They attract a ton of attention, a ton of traffic (which means ad revenue of course) and a ton of shares (which builds awareness).

Interestingly, the marketing world hasn’t picked up on this yet. You’d think those lifestyle, fashion, athletic, and other brands would be using this tactic to shine a branded mirror on their consumers, giving them the opportunity to tell their own friends what wisdom and coolness the logo-laden oracle has shared with them.

Which Wrangler are you?
Which TED talk persona are you?
Which Red Bull extreme sport are you?
Which Warby Parker frames are you?
Which Axe body product are you?
Which Brown Forman drink are you?
Which Universal Music band are you?
…I could do this all day.

And in the wasted minutes between meetings, appointments, meals, etc. we would all take a 30-second quiz to find out.

On flamboyant dancers and succeeding with social media.

stewardIf you have a brand and you’re trying to make social media work for you as an awareness-building tool, the single greatest thing you can do is be remarkable. Seth Godin talked about this pre-Facebook with books like Purple Cow and Free Prize Inside. Being remarkable isn’t about gimmicky sales tricks, clever headlines or shocking images. Being remarkable is behaving remarkably. Making it a part of how a brand is… not just what it says it is. This takes courage. It’s risky. It can backfire. But when it works, it comes off as authentic in a way no advertisement can, and your customers do all the work for you from there.

The screenshots above are from a friend’s smartphone as shared through Facebook. They are stills of a video from aboard a Virgin Airlines flight. What you’re seeing is a highly flamboyant steward dancing his way through the pre-flight check while disco music thumps over the intercom. It’s straight out of the film Bird Cage and it’s completely wonderful.

What you don’t see are the multiple smartphones held by passengers who are recording this performance as said steward prances up and down the aisle. That’s right, they’re recording being told how to fasten a seatbelt, where to look for their floatation device, and what to do when the oxygen mask falls from the ceiling. Essentially they are joyfully recording the description of a worst case scenario. Better, the video has all the hallmarks of great advertising – it’s charming, attention getting, memorable and carves out a unique emotional space for Virgin. It won’t appeal to everyone, but good advertising never does.

I bet the passengers treated to this performance became true brand fans that day (or had their pre-existing fandom validated). They ‘liked’ the brand not because they were bought with a coupon or sweepstakes entry, but because the brand did something remarkable – it made them happy, treated them like they were valuable and delivered real satisfaction in a space known for skimping, up-charging and making people feel like cattle. Pound for pound, I would bet that the people won over by Virgin on that flight – and those of us who saw the videos they made – have a stronger positive feeling about Virgin than most of the social media fans claimed by most companies.

What business sometimes forgets about social media is that it wasn’t invented for marketing. Marketers usurped it – just as we do for any new medium people cluster around – but regardless of what we wish people used social media for, most use it to share things that stand out in their lives – moments, friends, and experiences. They just tolerate marketers because we’re pretty easy to ignore and every once in a while they get free stuff from us.

To paraphrase Howard Gossage’s famous quote about advertising, “People share what interests them, and sometimes it’s a brand.”

To build real fans in social media, companies might do well to think about how they could behave remarkably in their space. This need not be flamboyant dancers either. Sometimes just doing right by a customer at a moment when they expect you won’t is enough to get them excited. And most customers todays are armed to the teeth with ways to share an experience.

You don’t need more share buttons on your website or more headlines telling your fans to share. They know how to do that already.

What they need are more reasons to share.

Has parallax (and web design) jumped the shark (again)?

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Not that it isn’t beautiful. It is. Check out this amazingly sophisticated site by Sony. The visual effects are staggering. I can only imagine the time, planning, labor and effort this took to design, shoot, compile, code and deploy. It’s like watching a blockbuster summer movie, or super-budget Super Bowl spot. You can’t help but appreciate the magnitude of the undertaking.

Which is exactly the problem. The execution eclipses the intention.

Whatever happened to form following function?

As I scrolled through (after waiting quite a while for the page to load) I didn’t read a word. Not one. I watched the electronics come together and split apart. I watched the scenes seamlessly meld into one another. I marveled at what I was seeing.  I completely forgot there was even navigation at the top by the time I started my descent. I also intentionally skipped over the opportunities to jump out for product detail, such was the lotus-leaf seduction of the parallax which kept begging me to scroll down, down, down.

When I got to the bottom and I didn’t know what to do from there. I clicked the logo and wound up on Sony’s homepage which felt a little anti-climactic.

We’ve come a loooooong way since the early 90′s – before marketing got ahold of the Internet and started polishing it for commercial use. Back then sites were dully utilitarian. Then along came Flash and “flying type” as a tactic. Remember that? This was followed by a backlash as web 1.0′s evolving “high design” gave way to web 2.0′s minimalist, functional aesthetic. More recently, even navigation has been simplified down to fewer, longer pages, as the world has forgotten about “the fold” and recognized that not everything needs to be in plain site, all the time.

But today this modern functional aesthetic is again being garnished with parallax and other visual effects. More information is being packed onto single pages. Sure, its spread out vertically, but there’s a lot more of it on each page. We’re bulking up again; adding sizzle because we don’t believe people will stick around for substance.

And they’re not. When it comes to learning about a product, people are skimming through those candy-coated, sexy brand sites and jumping onto social media to get the real story, from real people.

Even the sweetness of eye candy can make us nauseous when we’ve consumed too much of it.

As my college mentor once told me, “Style without substance is insipid. Substance without style is invisible.”

It’s the marketer’s job to strike that balance but Sony’s didn’t.

Of teenagers, poker chips and screen time.

Poker-Chips-psd31581As our children are growing (my oldest is now 13) we’ve become increasingly aware of how much of a role technology (e.g. “screen time”) plays in their lives. We’ve always monitored TV use, even when they were little, and continue to try to impress upon them the importance of a well-rounded life that involves technology, but also unplugged time. There are no shortage of articles – long and short – that recommend some caution and care in all of our exposure to screen time. As anyone reading this blog know, Nicolas Carrs The Shallows made a profound impact on my perspective of all things Internet and the risks that come from unchecked media consumption. I have conducted several experiments on myself in this regard and have felt first hand the effects of clear media addiction, withdrawal and independence.

Recently the American Academy of Pediatrics published a recommendation of no more than two hours of cumulative screen time per day. Working in digital media and loving video games, I am reluctant to make sweeping gestures about screens and technology. There is good and bad with almost everything we do, and our pervasive screens are no different. As the Buddhists say, “the key that opens the gates of heaven also opens the gates of hell.”

Regardless, the idea of a recommended “two hours of screen time a day” gave me an idea for an experiment which I have recently unleashed on my family…

Yesterday morning, I handed each of my daughters, my wife, and myself 14 poker chips (each of us getting a different color so no one could spend another’s currency). In the interest of self-direction, I told the girls we were all going to limit our screen time to about two hours each day. I showed them the articles and research I’d done so that the number didn’t look like it was plucked out of thin air. But this wasn’t an ultimatum with a stopwatch. Rather, this was intended to be a lesson is resource allocation, management, and mindfulness.

The rules are simple. Each Sunday morning we get 14 chips – one for each hour. Chips could be broken into half hour increments but no less. We could each invest those 14 hours any way we wanted during the week, from a single Lord of the Rings trilogy with all the extra footage marathon to a half hour here or there as we saw fit. If a special show was on (my eldest is a Sleepy Hollow fan and my wife happily sits through two hours of sobbing  contestants on The BIggest Loser) more chips could be spent on particular nights. At the end of the week, any unspent chips were forfeit (no rollovers!) but you could always count on a fresh budget for the next week.

Initially my older daughter groused (as expected) even as my law-abiding and exceedingly diligent younger one began to plot and horde her stash. But less that 48 hours into it, some interesting things are already happening. The most notable is awareness. None of us is taking the time spent on screens for granted and we’re all keenly aware that a lazy default to flipping on this or that screen comes with a cost.

Right now, as I type this, the house is wonderfully quiet. My children are reading books by the fire. We’ve not gone Luddite. Earlier today, my younger daughter and I each spent a chip playing Super Mario Kart (we unlocked a new cup!). And my older daughter made a point of mentioning (with barely concealed pride) how she coerced her friend out of the house and away from Minecraft (after they’d both played for a while) to go out and build a snowman.

Like nutrition and exercise, my biggest goal is to make my children (and truthfully, myself) aware of just how easily we can slip into habits. It doesn’t take much to accidentally add 600 calories to your daily intake. It’s easy to “take a break” from exercise for a week or two and have it turn into months (and pounds). And as I’ve learned in my own media usage habits, its easy to make Facebook or mindless web surfing, or killing hours on a video game a near-daily occurrence even as the list of books I’d like to read and projects I’d like to undertake grows.

In the speed of day to day life, mindfulness is hard to come by. I am curious to watch our poker chip experiment over the coming weeks. Already I can see it is having an effect on me. Especially since this blog post cost me a chip and I am contemplating Mass Effect 3 on my Xbox. Then again, Walking Dead premiers this week so I have to think this through a little.

Judging the ROI on viral video.

Old Spice 'Mom Song' adSo I was sent a report by Inefgy, a company that deals in social media analysis. It was a promotional piece entitled Old Spices’ Mom Song vs. P&G’s Pick Them Back Up. Both videos were online viral “hits” and Inefgy decided to do a tale of the tape analysis. Their thinking revealed what I consider to be a troubling bias in the world of social media measurement.

The report broke down both videos in terms of views, discussions started, and general sentiment and then looked at it all by gender as well. Both videos enjoyed roughly the same views at the time the report was written but Old Spice dominated in terms of conversations, outpacing Pick Them Back Up by %1560 (you read that right). By Inefgy’s analysis, and under the logic that conversation equals engagement and engagement equals success, Old Spice was the winning video.

I question those assumptions though, and here’s why: From a sentiment standpoint, Old Spice was viewed positively 59% of the time and negatively (it was considered “creepy”) 41% of the time. That’s a pretty significant negative sentiment rating. Now, if you subscribe to the idea that “if you try to please everyone, you end up pleasing no one”, the Old Spice video is probably doing its job. It’s obviously appealing to one target while possibly repulsing the other.

Meanwhile the P&G video won women’s hearts. It depicts the important role of mothers in the growth of boys to men. It was viewed positively 78% of the time and according to the report, most negative comments were more about the omission of the role of the father than of the subject matter itself being distasteful.

Clearly the Old Spice strategy is to appeal to the boys who use the product while P&G appeals to the women (moms) who buy the product. Interestingly, the report notes that “…the primary purchasers of the Old Spice products marketed under the Smellcome to Manhood campaign are likely parents rather than the boys themselves.” Makes sense considering the average teen isn’t really doing the weekly grocery shopping.

Deodorant is a low-interest category. I’d wager that people tweeting or posting about a deodorant video are probably reacting more to the film’s entertainment value (which for Old Spice is consistently high) than to the product itself. From a gross impression standpoint, both videos enjoyed about 3MM views at the time of the report. Each impression would have left an emotional association with the brand and as any marketer knows, emotions – especially for low-interest categories like deodorant – are important. In fact, “likeability” is one of the scientifically-documented primary drivers of persuasion (along with reciprocation, commitment, authority, scarcity and social proof).

So let’s do some back of the envelope math: For Old Spice, 1,800,000 of the viewers walked away with a positive emotional association, but 1,200,000 viewers reacted negatively to it. We know those viewers in general trended to be more male and younger because that was Old Spice’s obvious target for the ad while women, according to the report, had a higher proportion of the negative associations among those with such perceptions of the video.

Meanwhile P&G had 2,400,000 people liking their video. And more of those 2.4MM held the purse strings to the actual purchase of deodorant (among other P&G products).

Now, we know mom makes most of the grocery store purchases. How then can the Old Spice video be labelled as the better video? From a marketing perspective, I would argue that the video that reaches and appeals to more of the purchasing target, has the higher likelihood of closing a transaction. Sure, little Johnny may laugh at Old Spice, he may even ask mom to buy it, but Pick Them Back Up makes P&G’s entire portfolio of products, and its own brand, mom’s partner in child rearing. P&G says it “gets” mom, and that is very powerful.

Which gets me back to the troubling bias of social media measurement – it is often judged outside of a strategic marketing context. So much discussion of social media efficacy rests on vanity metrics such as “likes” and retweets. And while these things may be important in brand awareness and may even impact purchase decisions, the underlying strategy – including the purchase process and targeting is often not considered in the evaluation of the tactic itself.

If it were, it would be more obvious that while a funny deodorant ad that appeals to boys and makes them tweet is all well and good, an emotionally resonant video that connects with a key shopping demographic known to make purchase decisions based on emotional drivers, is probably better. Control for behavior (teens naturally tweet more) and the case becomes even stronger because the value of the measured metric (e.g tweeting) goes down the more common it is – because it is less likely to indicate significant engagement. (Put another way, people who serially and indiscriminately ‘like’ brand pages are less likely to really be truly engaged with any of them.)

Interestingly when I just checked with YouTube today, the Old Spice views had more than doubled, to 7.3MM, for which they got 15,200 ‘likes’ (0.21%). Meanwhile, Pick Them Back Up had 10.7MM views for which they had 24,300 ‘likes’ (0.22%). So, in terms of direct YouTube viewership, the number of people liking the videos (aka ‘engaged’) appears to have evened out while the P&G videos lead in reach has broadened considerably.

Assuming the proportions remain the same, that means the P&G video has more viewers, who have higher positive sentiment for the video overall and are of an audience more densely composed of actual shoppers. While Inefgy may award Old Spice a prize for stoking more conversations online, I am willing to bet the one yielding more transactions is Pick Them Back Up.

Not that is matters really, because P&G owns Old Spice. Which begs another question: Do the moms viewing Pick Them Back Up and the boys viewing Mom Song realize they’re two faces of the same company?

Being different things to different people – that’s the real power of branding.