James R. Dickey

Thanks to Tony Cecala, I have the pleasure of presenting a talk today on Critical Twitter Decisions.

My presentations tend to be image-heavy, so I’ll probably need to come back and add speaker notes for much of it to make sense, and I produced it in Google Docs and couldn’t figure out how to do a slide build so I did that by producing multiple versions of the same slide, each with additional information on it.

But in case you missed the presentation, or were there and would like a copy, here it is:

What is the value of Twitter? Of FaceBook? When and how should companies use either or both?
How Does Social Media Fit in Marketing? All great questions I’ve fielded in the past month.

The best way to answer them is to start with a discussion of the purpose of marketing in general for a company.

The Purpose of Marketing

All companies need to move people along the path from Mutually Unaware to Top Customer/Raving Fan. There are many steps in the process, and steps can be jumped or repeated, but in general the major ones are:

Mutually Unaware - the person has no idea of the company and its potential solution, and the company has no knowledge of the person and their matching need.
Suspect - the person hears about the company and/or their solution and/or the company finds out about the person.
Prospect - the company and person are mutually aware and the person has expressed a need that matches a product/service the company offers.
Trust-Earning - the company and person have some series of interactions (Bid/RFP response/meetings/calls/emails/free trial offer/etc.) that build the relationship and earn enough trust for consideration of purchase.
First Purchase - the person signs the contract and/or approves the payment for the product/service.
Repeat Purchase/Repeat Interactions - the person renews the contract/subscription, places another order, etc.
Loyalty - the person actively recommends the company to others and is willing to knowingly pay a premium to continue doing business with the company rather than its competitors.

Marketing’s purpose is to move people through these steps, from the bottom left to the top right in the value/relationship diagram. Marketing’s value is that, done right, it is the most scalable, efficient set of methods for doing so. To do this best, though, it must use the right combination of messages and methods for each person based on where that person is in the process and the company‘s culture, strategy, objectives and products or services.

How Does this Relate to Twitter and Facebook?

Most companies are fairly good at moving people along in the process once they’ve become a customer. Where many businesses have problems, though, is in finding potential customers and winning the trust of those people well enough to get that first purchase.

Twitter, Facebook and other social media sites are new - low cost - tools in the marketing arsenal to deal with that pre-sale process.
Absent social media, businesses must rely on unaided word of mouth and interruption methods of marketing like direct mail or television, radio and banner advertisements. They’re left with either little ability to influence their message, reach and frequency, or wasting money, time and effort annoying people with no desire or need for their products or services.

With social media, though, companies have a chance to be proactive yet non-threatening. To be top-of-mind whenever the person has a relevant need or desire, and to begin the relationship-building process so that the first official purchase is a natural next step rather than a significant hurdle.

With Twitter, for example, a company could literally have dozens of low-cost, low-commitment interactions with someone they might have never found or reached via lists or broadcast initiatives - or someone who will forward their communications - making Twitter a source of potential customers, a means for relationship-building, and a more message-controlled word-of-mouth enablement tool. FaceBook and other social media sites have many of the same advantages, and can be used similarly.

So Should I/My Company Use Social Media (or use it more)?

That depends. If you’re looking for a low-cost method of discovering potential customers, having potential customers find you, building relationships with them, and making it easier for people to spread the word about your company, then the answer is likely “yes“. However, there absolutely could be some combination of a company‘s culture, strategy, objectives and products or services that would cause the right answer to be “no”.

Today I had the pleasure of joining in a Chief Marketing Officer (CMO) roundtable hosted by GameStop and the Marketing Leadership Council. Other attendees included representatives from Dell, American Airlines and Dickies apparel. The discussion centered on the marketing efforts most valuable in this economic climate. Following are my notes from the discussion:

Consumer demand is depressed both for the short and longer term, driven by reduced access to credit, but also by declining wealth, focused reduction of debt and increased savings, and new sensibilities that find excess inherently less attractive.

Business demand is also depressed due to reduced access to credit, reduced sales, and an increased focus on margins. This reduced business demand is seen primarily in reduced discretionary spending, reduced future hiring and reduced current hiring and capital spending. Other expenses are seeing reductions as well, but to a lesser extent.

According to the Marketing Leadership Council,

the primary drivers of Brand growth are:

(these are important in any market, but particularly so in difficult markets)

1. Predictive ROI-based investing - only helpful to bring a company up to the median in terms of performance. Once a company has reached median performance, a focus on ROI in investing is actually counter-productive.
2. Future Needs-based investing - making decisions based on educated judgement about where the customer needs will be in the future. This is more important the higher the company is outperforming the median.
3. Aggressive segment orientation - dividing customers by segment (other than purely demographically-developed segment) was equally important regardless of the company’s relative performance, and was the single biggest contributor to brand growth success overall. Particularly important was a knowledge and implementation of segmentation outside of just the marketing and sales departments.
4. Generalist-first talent strategy - the more companies focused on building a broad range of talent into all employees, the better the impact on brand growth.

Key priorities during the downturn, then, should be to:

1. Maintain budget/ROI discipline.
2. Stay on top of changes in what drives customers to buy.
3. Improve implementation of and focus on customer segmentation.

The tough thing in this environment in maintaining budget discipline is anticipating uncertainty and incorporating it into your plans. It is difficult to do so because we inherently gloss over uncertainty and actually are more likely to make uninformed decisions the more uncertainty exists. Make the effort to work against this tendency and have pre-established triggers to warn you of and contingency plans for unlikely but important events should they happen.

The easiest way to stay on top of changes in drivers of customer purchase behavior is to incorporate consumer feedback. Some

critical guidelines for a successful key consumer co-development program

are:

• Special Treatment for the individuals in the program - make sure they know they’re appreciated and their participation is considered valuable.
• Mutual respect - make sure the company and customer participants interact in an environment where each group/individual’s opinion or suggestion is respected.
• Clear ground rules - make sure they know that not everything will be adopted, and even those that do may not happen on their time preference.
• Veto rights - apply sound business logic to the suggestions received and implement those that truly add value to the organization.

There was much more presented of value, and of course the specific examples presented by the attendees were particularly helpful. For both space limitation reasons and confidentiality, though, I’ll stop here for now.

I highly recommend the Marketing Leadership Council to any firm looking for great ideas, case studies and best practices. Being a member for the past two years has certainly helped me, and I’m sure it will help others as well.

This morning I realized my “to read” stack was pretty thin, so I asked the fantastic people who follow me on Twitter what the best book was they’d read recently. Here are their recommendations and their comments:

• patrickstrother: The $12 Million Stuffed Shark: The Curious Economics of Contemporary Art
• halalpiar: Shantaram by Greg Rogers Brutally spectacular 933-page story & brilliant writing.
• rickrichbourg:Waking the Dead by John Eldredge
• Seorse: 1776 by David McCullough…. Amazing book..
• Citril: The Shack. Some very beautiful moments in it that enforce the depth of love God has for us.
• blfarris: Parenting from the Inside Out - amazing!
• JonDiPietro: Conqueror series (Ghengis Khan) by Conn Iggulden
• rhondakwrites: Best book: Wrestler’s Cruel Study-Steve Dobyns. His poetry isn’t bad either. Gothic classic: Melmoth the Wanderer.
• ppizzi: Marketing Metaphoria by Zaltman - a great read
• JasonAltenburg: Stranger in a Strange Land by Robert Heinlein
• swaynette: Groundswell
• MarkMatson: Atlas Shrugged - killer!
• KathyKeatingPR: Secrets of Social Media Marketing-Paul Gillin
• sharilee: In marketing: The Cluetrain Manifesto, best non-work-related: Benjamin Franklin by Isaacson
• bertowud: Daemon by Daniel Suarez
• tim_rueb Marketing Warfare, Basic Economics, First Break All The Rules, Now Discover Your Strengths, Purpose Driven Life
• Nitewraith: Stephen King Goes to the Movies. Five of his Novellas that were made into movies. Light reading.
• SherKro: Deaf Sentence by David Lodge
• susan_s_smith: Inside the Revolution by Joel Rosenberg
• SherKro: Nothing To Be Frightened Of by Julian Barnes
• Cogiva: Good to Great by Jim Collins and All I Ever Wrote by Ronnie Barker
• pattidigh: Novels The Time of Our Singing by Richard Powers and The Tortilla Curtain by T.C. Boyle. Memoir The Planet of the Blind by S. Kuusisto
• swaynette: Credit Risk Assessment by Clark Abrahams and Mingyuan Zhang
• Alexandra_A: Good to Great by Jim Collins
• SusanMacD: Nineteen Minutes by Jodi Picoult
• bruceb: Team of Rivals - The Political Genius of Abraham Lincoln by Doris Kearns Goodwin (long slow read - but good)
• Anonymous: Series of books by Douglas Preston and Lincoln Child, the first one in the series is Brimstone

I love how almost random the mix of books is. It’s a little heavy on marketing focus, but that’s my specialty, so it’s not surprising or problematic. There are easily a dozen great new finds for me in this list.

How about you?

Do you have a great book to add to the list? If so, please add it in a comment to this post.

If you like some or all of the recommendations, pick up the books - and follow the people who recommended them. They’re great, generous people, and hopefully you’d learn as much from them as I am.

A nice overview presentation on Twitter, under an Attribution Creative Commons license (including the images), for anyone who wants to explain Twitter to colleagues, clients, friends, etc. By Made By Many, along with BBH Labs.

So the next time a client, friend or significant other asks why you bother with Twitter, feel free to point them this direction.