The Modern Media Agency Series is supported by IDG. With the explosion of mobile devices, advertising dollars will begin to shift to mobile for tech marketers this year. IDG Global Solutions President Matt Yorke explains why these trends should not be ignored.
In the not-so-distant past, media agencies spent a client’s marketing dollars on a standard set of carefully planned options — print newspapers and magazines, radio and television. How quaint. In 2011, TV still reigns at the top of advertising budgets, but online media is on the rise, and it’s transforming the way media agencies plan and measure campaigns. Jump-started by the economic downturn and propelled by changing consumer habits, Internet advertising and social media have captured a growing share of the market and a disproportionate share of the industry buzz and innovation.
Gone, too, are the days when simply having a corporate Twitter account or Facebook page was an accomplishment in itself. Agencies are finding innovative ways to integrate traditional media with social media and mobile to create networks of brand “touchpoints” for consumers.
Mobile is in. Metrics are in. Recession cutbacks are out. The perennial difficulty of measuring the effectiveness of marketing is not gone, but it has evolved. With constant instantaneous feedback pouring in from across the web, the biggest problem is knowing how to analyze the deluge of data — and turn it into action.
Series Supported by IDG
The Modern Media Agency Series is supported by IDG. With the explosion of mobile devices, advertising dollars will begin to shift to mobile for tech marketers this year. Ad networks, ad exchanges and real-time bidding significantly expand marketing options and underscore the importance of data. IDG Global Solutions President Matt Yorke explains why these trends should not be ignored. Read more.
If there were one giant global sports tournament, to be decided by how many fans a team has on Facebook, Manchester United (9.9 million fans) would lose a close, tense final match to FC Barcelona (10.3 million fans).
But what if you decided the winner on how many of those Facebook fans are active – that is, the ones liking posts and making comments? Then Man United’s 256,000 active fans would run away with the trophy. Barcelona wouldn’t even get a runners-up medal. Its 142,000 active fans are fewer than Real Madrid’s 155,000. (All numbers are rounded to the nearest 1,000.)
Such are the results of a fascinating new monthly ranking of Facebook fandom, cooked up by New York startup FanGager. In a bid to promote its CRM-style dashboard of social media engagement, the startup has started curating a list of the top 100 most active fan pages. “Brand managers are collecting fans,” says CEO Eran Gefen, who started the company in Tel Aviv two years ago, “but we think the conversation should move to engaged fans — just as on the web, counting hits and page views gave way to counting unique users.”
Moving the conversation would be good for Justin Bieber, too. The Canadian pop star’s 20 million fans are outnumbered by Lady Gaga‘s 29 million — but Bieber’s number of engaged fans, 360,000, is the highest on Facebook. Lady Gaga’s 148,000 engaged fans can’t even top those of Kesha or the Black Eyed Peas.
Facebook game company Zynga has the second highest number of active fans, for its Texas Hold ‘Em poker game, while Facebook’s own fan page doesn’t even make the top 10. Glee is by far the most engaging TV show, apparently, followed by Jersey Shore and trailed way behind by How I Met Your Mother and House.
Given that Jersey Shore activity, the top-ranked corporate brand in the listing, MTV, may come as little surprise. The second highest corporate brand, Victoria’s Secret, also requires little explanation. The top packaged goods? Skittles, followed by Oreo cookies. Check out the top 20:
Man United can’t claim quite as many engaged fans as Bieber or Zynga, but it does walk away with the title for highest percentage of active fans in the top 100, at 2.6%. But Gefen says that figure pales into comparison with the U.S. Army, which has relatively few fans but a 10% activity level.
As for Mashable? We’re closing in on half a million Facebook fans — and a very respectable 4.5% activity level. Thanks, everyone.
If event registration site Eventbrite’s experience is any indication, social media marketers looking for monetary returns on their efforts might get more value from Facebook than Twitter.
The company announced Wednesday that an average tweet about an event drove 80 cents in ticket sales during the past six months, whereas an average Facebook Like drove $1.34.
The study, which used in-house social analytics tools to track ticket sales on the site, was a continuation of a similar analysis the company released in October after analyzing data from a 12-week period. That study also indicated Facebook drove more sales for Eventbrite than Twitter, although the difference between the two networks’ sales per post was greater at that point than throughout the entire six-month period (the “value” of tweets increased).
In addition to each individual Facebook Like driving more sales than an individual tweet, the study also revealed cumulative activity on Facebook was greater than activity on Twitter for Eventbrite. People shared Eventbrite events on Facebook almost four times as often as they did on Twitter. The company attributes this disparity to Facebook’s wider reach and greater emphasis on real-world ties.
It’s important to note that only a very small percentage of site visitors shared event pages on either network. Just 1% of people who landed on an event page shared it with their friends; 10% of people who had purchased a ticket did the same.
Obviously people are more likely to share events if they are attending. Their friends, according to Eventbrite’s data, are also more likely to buy tickets to an event shared on Facebook by a ticket holder than one shared by an uncommitted friend. But whether these trends, or any of Eventbrite’s findings, are relevant to other types of purchases is still a matter of speculation. But Eventbrite is betting they are.
“We carefully track sharing behavior in an effort to help event organizers tap into a new world of distribution for their event promotion,” wrote Tamara Mendelsohn, Eventbrite’s director of marketing and former senior analyst at Forrester Research, in a blog post about the study. “But the findings apply broadly to all e-commerce businesses, because the foundations of e-commerce are shifting as the social graph becomes a meaningful influence in driving transactions.”
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Research Summary: Growth in Vendors and Market Demand –Yet Space Is Immature Social Media Management Systems, like CMS systems for websites, these SMMS systems (see list of all vendors) help companies manage, maintain, and measure thousands of social media accounts, are the next growth market for the social business category. While saturation is at 58% of corporate buyers, the average deal size is a meager $22,000 but will expect to grow to six figure annual deals in coming quarters to meet market demand. This growing space has low barriers to entry, which result in a flood of clones, but expect only a handful to remain after a shakeout to serve enterprise-class buyers. Buyers and investors should focus on vendors that understand business –not just technology, offer services and reliable SLA, and deep integration with other social systems. In the future, this technology set will mature to grow into a data company that will extend it’s scope beyond simple Facebook and Twitter and impact how marketers approach the market, product innovation, and supply chain.
[Although the nascent Social Media Management System space is only one year old, 58% of corporations have adopted at least one of these 28 vendors]
Above Graphic: Market Saturation and Average Deal Size of the Social Media Management Systems (SMMS) by Corporate Buyers in 2010-2011
Year One in Review: New Entrants, Acquisitions, and Growing Deal Sizes. Just a year ago, we saw the rise of the new category Social Media Management Systems, (I must give credit to Cisco’s Social Strategist LaSandra Brill for giving me the kick to start it). To understand the macro trends of this industry, read with the Social Business Stack, which shows SMMS as only a component of the overall purchase set for corporations. Here’s a breakdown of what’s occurred in the past 12 months:
SMMS By the Numbers:
Growth rates rose 11% from corporate buyers. In 2010, adoption of SMMS systems by corporate buyers was already at the 52% and in 2011 buyers indicated they will be at the 58% adoption rate.
Deal sizes grew 57% in last year. While there was significant relative increase in deal sizes the overall average annual deal size per corporate was $14,000 in 2010 and rose to $22,000 in 2011 according to our research of 140 corporate buyers.
Large corporations spend $68,000 per year. For corporations with over $10 billion in revenues, the deal sizes ballooned to $68,000 per year on average, demonstrating that the larger corporations need these tools in order to manage their hundreds of accounts. (more data here)
65% Increase in vendors in last 12 months and growing. When I started this list, there was 15 vendors after launching the list after the first week. Today, the list has grown to 23 vendors (and I’m continuing to add vendors, with a market growth rate of 65% increase in new entrants, this will only continue this year.
Growth markets in consumer facing and large corporations. While I noticed that Telecom and Tech were early adopters, I’m seeing growth opportunities in Retail, Hospitality, Restaurants, Consumer Tech, CPG, and all Regulated Industries.
Consolidation: at least three acquisitions. CoTweet was recently acquired about a year ago by marketing platform ExactTarget, months later Objective Marketer was acquired by Email Vision, and just in this past Feb Constant Contact acquired SCRM company Bantam Live which has some SMMS features, all which are email/direct marketing solutions. Among all these acquisitions, we’re seeing these tools tie into greater marketing platforms for additional value.
Some early forerunners –but don’t expect a clear winner. I’ll do more detailed analysis on these vendors later, but right now I’m hearing from buyers the following vendors: CoTweet, Hootsuite, Spinnklr, Spredfast and newer entrant Expion. Interestingly, former Community Platform vendor with enterprise experience Awareness Inc has double downed on this market and shifted away the saturated community platform market by launching Hub.
Early vertical focuses have emerged and partnerships. We’ve already started to see verticals appear, such as GOSO for the Automotive dealer space, and expect this to continue in specific markets like hospitality, restaurants, travel, CPG, and Retail. Another new entrant was an entry by initially a consumer tool Seesmic, who received funding by Salesforce –the first enterprise vendor now with integration with social aggregation tool Chatter, and now Yammer. There was only misfire, as KeenKong changed their product strategy and never launched in this market.
Market Demand: Six Forces Spur On This New Category There are a handful of forces that are increasing the demand for this year old category, among them (but not limited to) include:
1) Corporations Struggle to Manage Hundreds and Thousands of Accounts
The target market is hospitality, retail, and CPGs. Each of these corporations has dozens to hundreds of unique brands, and then regional rollouts. For example, some hotels could have up to 15 brands, and each having 4,000 hotel locations (half being distributed franchises), each with 10 social media accounts (there’s more to the social web that Facebook and Twitter, across a variety of languages. Furthermore, there’s high turnover in the localizes marketing and sales manager, who also lacks a background in online communications.
2) Kenneth Cole and Chrysler Debacles Prove Need for Parental Controls
In the last few months, we’ve seen some severe examples of mis uses of corporate social accounts which could have been prevented by having a process and toolset to support (see the long list of “punkings“). In particular, Kenneth Cole’s ill-fated tweet tying the Egypt situation with spring sales was met with a riotous reaction, and last week’s Chrysler’s F-Bomb tweet resulted in firing of an entire agency. As a result, expect that many regulated companies will demand compliance regulations with social media, and be mandated to invest in SMMS systems to preview, flag, an process content before it’s published. Of course, this brings forth a few challenges such as less real-time approach, and a more sanitized corporate approach to discussions that will ultimately decrease credibility as authenticity may waver.
3) Expect Regulatory Industries to Require This Safeguard System
Similar to the mess-ups listed above by Kenneth Cole and Chrysler will cause regulatory industries to give pause on how employees will use these technologies. As a result, expect healthcare, pharma, insurance, auto, finance and beyond to start looking at using these tools for all employees and even corporate accounts. Expect a keyword filtering system and workflow to be put in place to monitor then recommend a course-of-action to correct deviant tweets and Facebook messages. The downside? The rapid pace of the real world conversation will be slowed for many, but expect seasoned veterans to unleash the SMMS shackles for open conversations.
4) Direct/Email Marketers Want a Piece of Social Marketing to Blast in New Channels
This toolset is an attractive addition to existing direct marketing platforms like email marketing suites that are used to publish thousands of emails to customers on a daily basis. Direct marketers, who want to get on the social bandwagon are finding religion and are now blasting content on social channels to networks comprised of news, deals, and offerings with mixed engagement and interaction.
5) Agencies Know SMMS Provides Client Lock-in and Recurring Revenues The social media service industry knows they must be value added beyond strategy and community management. They are seeking recurring revenues for accounts on a monthly basis in order to glean the hundreds of thousands per client, see data to learn more. By using SMMS systems, often coupled with brand monitoring and reporting services, they are now able to be full-service to listen, engage, and measure how companies are interacting with their customers on social channels. By partnering with SMMS systems some are white labeling the service, and using this in front of clients as a value added software, suggesting a perceived lock in with data and reporting –giving agencies the opportunity to become the Social Media Agency of Record (SMAoR).
6) A Complementary Toolset for Social Platforms, Social Commerce, Brand Monitoring Vendors, Marketing Automation First, understand how SMMS fits into the overall Social Business stack. You’ll notice it’s a sister technology to the technology “aggregation” displayed to the left of it. You’ll also notice that it’s below brand monitoring firms, and sits on top of Social Platform technologies. To the left of it you’ll find it is part of the data story in infrastructure and to the right of it services. Other places to watch for acquisitions will be social commerce platforms, as well as marketing automation platforms as they must spread into this space at a rapid pace to glean the revenues.
Predictions: Vendors Move-out-of-Garage to Meet Buyer Needs
These companies are young and early, and lack maturity like the established community platform space, here’s a few closing thoughts:
This One-Year Old Space Shows Parallels to the 5 Year Old Community Platform Space Similar to how in 2007, how we saw trends for the Community Platform market, labeled it, and went on to research the space, I’m seeing similar trends (entrepreneur styles, deal sizes, market saturation) in this early SMMS market, just one year in.
Vendors startup mentality clash with real buyers needs. Many of these garage startups lack understanding of corporate buyers. Not uncommon to seed, angel, and A round vendors, a majority of these vendors lack corporate buyer perspective. To learn more about the buyers of SMMS read the report about the Career Path of the Corporate Social Strategist.
Vendors will finally offer and enterprise class service level agreements. Mainly focused on platform development, and also being discouraged by investors to add services to the mix, most of these vendors lack the staff to serve a corporate buyer who needs a high degree of hand holding in social business. Better yet, read Petra Neiger, one of Cisco’s Corporate Social Strategists perspective on what’s needed for buyers.
Analytics and reporting to be a core focus on 2011-2012. These early platforms are focused on management of the social channels, and most do not have strong analytics and reporting technologies. Furthermore, they are often not connected to other reporting systems, and are data silos.
Expect corporate adoption to reach 90% within three years . Expect market saturation to hit 90% range in three years, and average deal sizes to exceed $100k per year on average corporation –just as the Community Platform space have experienced over the past five years. Vendors that can align their product roadmap to the SMMS maturity roadmap stand to be one of the standing contenders.
Deal sizes will reach six figures on average. I saw this trend before with the $25-50k deal sizes with community platforms about 5 years ago and have watched them balloon to $200k-300k for advanced and larger corporations on an annual basis. I expect similar patterns to emerge here as new functionality is offered and as the SMMS connects to other systems for lock in. Right now the average SMMS deal size is a mere $22k, yet as we segment out corporations with high revenues (over 10 billion, annually) they are already clinching $68,000 deal sizes –remember it’s only year one. Read more about how corporations should spend on social business.
Market will reach over 100 vendors. Just like the crowded brand monitoring space (150 vendors) and community platform space (125+) vendors expect this category go balloon due to low barriers to entry, VC funding, and commodity technologies. In the long run, only a half of dozen will matter to the enterprise, as market consolidation will occur. Expect the 90+ that don’t become first of mind to corporate buyers to head into specific market verticals and SMB focus.
Well that’s my perspective after watching this space for the last 12 months, while I’ll continue to give updates, expect another wrap-up next March in 2012.
For one hour on March 26, millions of people will turn off their lights and sit in relative darkness. It may seem like a random way to support environmentally sustainable action, but Earth Hour — a global initiative in partnership with the World Wildlife Fun (WWF) — is hoping that one hour of darkness will lead to a whole year of change.
Begun in Australia in 2007, Earth Hour has grown exponentially. Last year, more than 125 countries participated in the self-imposed blackout. Even major landmarks such as Rome’s Colosseum, San Francisco’s Golden Gate Bridge, Toronto’s CN Tower and Egypt’s Pyramids went dark to support the cause.
This year, Earth Hour will take place from 8:30 to 9:30 p.m., local time, March 26. The various time zones will create a wave effect as countries show their support hour by hour.
Despite the international acceptance and support, Earth Hour has been plagued by accusations of poor effectiveness. Sure, it’s great for people to spend an hour thinking about the planet, but what happens at 9:31 when all the lights go back on? What kind of change can a one-off event really have?
Earth Hour, on its skeleton crew, has been trying to answer that question for five years. Now, they think they might have the answer in a new platform designed for and powered by its millions of supporters.
Beyond the Hour
“Beyond the Hour” is a platform that allows anybody to post and pledge his or her environmental actions and then share those promises and stories through social networks. With global scale in mind, the platform will be translated into 11 different languages.
Users can mouse over the dynamic images to preview randomly selected actions or search by a variety of terms, including location. If users see an action that speaks to them, they can join in by clicking “do this” to mirror the pledge.
An app version of the platform has already landed in the iTunes store for iPhone, with an Android version on the way. Both offer all the same functionality of the web app.
Earth Hour also created embeddable widgets to allow bloggers to share “Beyond the Hour” from their own sites. All of these projects feed back into the platform.
An Environmental Resolution for the Planet
Earth Hour co-founder and executive director Andy Ridley always considered the hour to be a valentine to the planet, or even a New Year’s Eve-type event. He hopes Beyond the Hour will act like a web portal for millions of New Year’s resolutions aimed at environmental living. “The plan was always to go beyond the hour,” Ridley said. “If you can prove that hundreds of millions of people care, what do you do next? There’s only a few of us [on staff], so we had to make it open source and hand it over to the people out there. The next bit is asking: ‘What does everyone want to do?’ ”
Just like a normal New Year’s resolution, that idea obviously has its pitfalls. Are you really going to go to the gym more this year? Are you really going to switch our your incandescent lights this year? However, while it’s easy to point theoretical fingers, Beyond the Hour has already racked up some extraordinary promises.
The government of Nepal has committed to put a complete stop to tree-felling in the Churiya Range, a vital ecological and sociological forest area. Mengniu Dairy, a Chinese dairy company, is doubling the number of milk cartons it recycles and increasing its use of FSC-certified packaging. Clover Moore, the Lord Mayor of Sydney, has committed to another six separated bike lanes (“cycleways”), installing LED lights in parks and streets and endorsing a tri-generation plant to provide low carbon energy. Credit Suisse AG is sponsoring an Earth Hour in Singapore and also promising to send staff to a Brazilian forest reserve to support field research.
It’s possible to get involved even if you’re not a major government or company. Chloe Nicol, a 7-year-old girl from Australia, is guiding her school to increase recycling and reduce energy waste. Ridley pledged to only drink local beer to help cut down on the cost, waste and emissions of shipping and transportation. It may be small, but those little promises can add up.
So What’s the Big Deal?
Earth Hour’s mission is not revolutionary in and of itself. Many other organizations and non-profits have tried to use the Internet for green causes. What stands out is how the project has evolved to embrace social media not just as a talking point but also as a way to extend its impact. “The big inspiration [for the campaign] was the frustration that we were not reaching out to millions of people,” Ridley said. “We were only talking to people that already sort of agreed with what we were saying.” The first year, millions of Australians joined Earth Hour but the idea didn’t quite have global appeal.
The team used social media to spread awareness but also to listen to the global conversation. Ridley explained that Morocco joined Earth Hour in 2010 thanks in large part to seven students. “They contacted us through Facebook and said, ‘We want to do this for the whole city.’ We basically sent a letter to their mayor and that’s a story that’s sort of been replicated across the world,” Ridley said.
Despite having an extraordinarily low budget (Ridley said a lot of the work is done by friends as favors), online tools have been a way to grow the campaign without blowing the bank. Ridley hopes the new Beyond the Hour platform will help make the goal a reality by empowering the Earth Hour community. “The holy grail for us is to start getting lots of content but [also] to start getting into the situation where the kid in Beijing can connect with the kid in Rio, using Rosetta Stone, to share what they’re doing in their home or on the street. You can scale that to cities and countries.”
The whole point is not to create a social media “event” or blackout stunt but rather to use the rally point as a launch pad for environmental conversation driven by social networks and tools like Beyond the Hour. It’s possible for social media to inspire change, whether you’re the government of Nepal or just looking to drink local beer.
Now it’s your turn: What do you make of crowdsourcing social good and do you think it’s possible for the community to organize itself? Sound off in the comments below.
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