August 19, 2009

Recent Report Details 15 Best Practices of Top 100 Brands

I’m often asked by CEOs and business owners about the business benefits of Twitter. Clearly they see my enthusiasm for it, but remain skeptical about what it can do for their business. The best response I’ve found that sums up my points beautifully is written by Jeff Bullas on his blog, and I’ll quote him here:
“And now this report from Engagementdb.com , evaluates how well they are engaging their consumers using social media and how that engagement correlates with their most important financial metrics: revenue and profit.”
Here’s a summary of the findings of that report:
4 Key Observations

As the number of channels increase, overall engagement increases at a faster rate. Brands that were in seven or more channels engaged deeply across all channels where they were present, as compared to brands that were present in fewer channels. There is an exponential growth in the depth of engagement as the brand extends itself into more and more channels.
Engagement differs by industry. Not only are some industries on average present in more channels, they also engage with them more deeply. For example, media and technology companies tend to be in more channels and engage deeply within them than,…. apparel, consumer products, food & beverage, and financial brands which is to be expected given that companies in these industries are just beginning to experiment with social media.
Financial performance correlates with engagement. Back to the million-dollar question: Why do social media? Because it pays off. While no one yet has the data to determine direct cause and effect, what is found is a financial correlation between those who are deeply engaged and those who outperform their peers
It Provides ” Multiple Communication Touch Points” More touch points can present a ripple effect, inducing viral marketing, boosting brand recognition and driving sales volume. Simply it means that different people prefer different types of communication, so the more types of communication, you as a company are enaging in, the more chance you have of creating a broader and deeper reach in the market place.

15 Best Practices of Social Media Implemented by the Top 100 Brands

Deputize people throughout the organization.
Understand how each channel provides a different dimension of engagement
Centralize coordination
Find champions who can explain and mitigate risk.
Be in it for the long haul
Pick channels carefully.
Spread engagement to employees beyond the social media team.
Open the platform to anyone and everyone.Encourage employees to tap into social media to get work done
Engage in new channels where people already are
Support engagement as an extension of the company culture. Be conversational from the start.
Be conversational from the start.
Make social media part of the job, just like email
Modularize and synchronize content across channels
To scale engagement, make social media part of everyone’s job.
Emphasize quality, not just quantity.

And, on her blog, Nora Oberle adds these take-aways from the same report:

How is it possible to quantify the worth of Social Media?

Instead of blindly hopping on the bandwagon, it is crucial for companies to define what success in the Social Media scene even looks like. Engagementdb finds that it actually “pays to be social” (!), using only one criterion: engagement. And of course, deep engagement does not mean having only a mere presence on Twitter or Facebook.
Engagement is correlated with financial performance.
Engagement in turn is measurable using criteria that quantify each particular social media channel. Also, the breadth and depth of the overall activities.

Which levels of engagement are linked with best financial performance?

There is no direct proof of cause and effect yet. But still: Being social pays off.
Mavens: Companies that are both widely and deeply engaged cut ahead of their competitors in terms of revenue and margin growth- despite the current economic situation.
Butterflies: Companies with a wide variety of social media activities but a lack of depth in each of these channels have significantly stronger revenue returns than competitors. Maybe this is because more touch points with lower engagement still means a gain for brand recognition, which in the end is financially beneficial.
Selectives: On the other hand, deep engagement in only a few channels brings notably higher gross and net margins.

Essentials of the best practices: What can we learn from Starbucks, Toyota, SAP and Dell?

How can you be single-minded in different facets?
Starbucks understood that each social media channel has got a specific value proposition. So, they developed different facets of their relationships.
Starbucks on Facebook: Mix of content from Starbucks and customers sharing their enthusiasm. Starbucks is not only talking to the 3,5 million fans on Facebook, but they can also talk about their love for the product.

Starbucks on Twitter: One person answers to inquiries of any kind (from menu changes to coffee grinder replacements) and spreads word about the latest news and contests.

Starbucks and consistency: Besides the various online activities of Starbucks, they also do a lot of shutting down. This points at being single-minded when it comes to social media and that they are protective of their channels for dialogue. They make sure that they use them in the right way.

How can you smartly manage social media activities with very limited resources?

Toyota only has a social media team of three people. Nonetheless, they rank 21 out of the top 100 global brands. Toyota embraced that “If you are going to engage, you have to have a plan and make sure that resources are available. Because you can’t gracefully exit(…) The days of walking away from a campaign are over-once we engage, we have to commit to it.”

Therefore: Toytota managed their online activities in an exemplary manner.

1. The path of least resistance: Engagement started slowly and cautiously with a YouTube Channel of existing footage and a Twitter account later on.

2. Extend reach, even though a corporate blog is unthinkable: They only recently launched Facebook pages for the Prius and Lexus.

3. Use technology to engage employees: Toyota uses CoTweet to manage multiple authors on Twitter. This ensures that only experts react to inquiries.

4. Guidelines and best practices: Customer engagement can be assigned to any functional group of the company, since everybody knows the rules of the game.

5. Set up internal governance board: Creating a system that regulates how content should be shared between the Toyota, Lexus and Scion divisions makes it easier for the social media team to request content.

In a wide-spread community around the brand: Is it possible to keep in charge?

With SAP, anyone and everyone can contribute to their blogs, discussion forums, wikis and the SCN site. This is encouraged with a point-system, which rewards the contributors in so far as it communicates reputation and expertise.

SAP gains control by letting go: They realize, that by using social channels, actual work can get done. For example, CTO Vishal Sikka recently blogged about concepts like “open cloud computing” to gain feedback.

This open culture also reflects on SAP’s Twitter usage: There are a variety of SAP accounts, foremost because they believe that a corporate presence doesn’t speak well in Twitter — individual voices are more engaging.

Which role should social media play in everyday business?

Dell tries to make social media part of the job, just like email. This approach routed to an overall change in company culture, which is now conversational.

15-20 minutes a day is how long every Dell employee is engaging with social media daily.