When Twitter’s valuation went from $3.7B to $7.7B earlier this month, investors wondered if it was residual from the “Charlie Sheen” effect or if the pre-IPO market for social media companies had reached its climax.
The debate is bound to continue this week, as Qihoo (NYSE: QIHU), China’s number three internet company, goes public and many hope for a future that resembles Sina Weibo (NASDAQ: SINA), China’s Twitter, whose stock more than doubled last year.
Could all the valuation discussions distract from the true impact these technologies have for your company when you start using them? Don’t let the buzz around the technology take precedence over more important fundamentals. Here are few things to consider:
I’m not just an online friend, I’m your customer
I’m consistently surprised by the number of organizations who bolster about their social media campaigns but haven’t yet solved the basics of their customer relationship management systems. I was recently travelling with a major international airline, one of the biggest. At check-in time, the airline attendant explained that she wasn’t able to print out a pass for my connection. I was to try to make my connection through a country whose language I didn’t speak and explain to the local team to look me up in their computer. It might work, but if it didn’t, who would help me? Their company’s twitter feed?
What this mean to you: Integrate, then socialize
You might get thousands or millions of followers because of your brand, but if you don’t do anything to solve the basics of your customer systems, your social media strategy will ultimately fail.
Before starting a social media campaign, look at the possible integration issues along your customer experience. Have you removed all potential friction for them? If you are an airline or a bank, you might have system integration challenges as a result of the many acquisitions within your industry. Solve those first and quickly. My bank has been trying to reconcile two of my out of state accounts for the last 5 years. No amount of social media attention will fix my frustration.
Then, get your systems and marketing people together and buy them two books that came out this month: Enchantment by Guy Kawasaki and Thank You Economy by Gary Vaynerchuk. Each book will take them through the rules to observe when dealing with customers. In a highly competitive space, your organization’s ability to empower its employees to enchant and delight customers is the ultimate weapon.
You might elect to push forward your social media efforts first to incent your systems folks to resolve integration issues faster. That could work. Be sure to remind all your employees though that their customers are not just online likers or followers; they are also customers, in the flesh and blood. If they don’t believe you, have them watch this quick interview by Seth Godin on the value of social media for businesses.
Don’t implement solutions, prevent problems
A few months ago, Jeremiah Owyang, Industry Analyst and Partner at Altimeter Group, opened his session at the LeWeb Conference by telling his audience, “Don’t hire social media gurus, ninjas, samurais or experts.” They might advise you to hire staff to change your customer service processes from traditional to a more reactive, real-time system. Many may advise you to measure results in Twitter followers or Facebook-likers growth. They will ask you to integrate your site with social media features too. All of these might work, but do they help you focus your business and employees on the drivers of your business?
What this means to you: Influence is more important than mass
The risk with social media when it comes to customer relationship (either via marketing or services) is that it focuses your employees on the transactional aspect of relationships rather than the longer term relationships. Providing good and reactive customer support might be fine but are you able to uncover the fundamental and recurring issues your customers are dealing with? Are you using social media to significantly decrease customer churn or are you just firefighting?
Most of the answers lie in the data you collect from your customer interactions. If anything, you should probably start by measuring the influence of your followers, rather than just their sheer number. Tools such as Klout help to understand the influence of your followers and bubble up the top issues that get circulated in the community. You’d be surprised to find out that the most influential people on twitter are not necessarily the ones that have the most followers.
The faster you can answer the fundamentals of your marketing strategy and your customer service principles, the faster your organization will be able to use social media as a competitive tool to win.
Don’t fall for the hype. Social media is here to stay. Charlie Sheen’s ascension to a million followers in 24 hours is not a great model to follow. When Charlie Sheen meets Peter Drucker, Drucker wins all the time.
