MarketingSherpa Blog

I had a conundrum once at dinner when I was a young military guy stationed in Tampa, Fla.

I wanted to try something new, and I had my mind set on Chinese food. In an attempt to get an unbiased opinion, I fired up my trusty laptop and Googled “Chinese food Tampa.”

After sorting through a few million results, I arrived at a few good recommendations based on star ratings and other such nonsense. Just to double check, I phoned a friend who had eaten at the spot I chose.

Knowing my personality and my legendary picky eating habits, he recommended that I not go to my top choice. Of course, I completely ignored him and did it anyway.

Gripped in the depths of gastrointestinal distress two hours later, and surrounded by throngs of hipsters, I realized a simple truth: star ratings are a ridiculous way to gauge a product or service.

As it turns out, most Americans agree with me, at least in principle.

A recent report from Forrester Research indicated 70% of Americans trust brand or product recommendations from friends and family. To give you an idea of how high that percentage is, only 46% of Americans said they trusted consumer-written online reviews.

The takeaway from this research is Americans trust personal recommendations at a much higher rate than reviews from strangers.

That creates an interesting dichotomy since most e-commerce stores offer consumer ratings, but not friend and family recommendations via social media.

Take a look at this product page. It just so happens to be the Amazon product page for my recently published book. 

You’ll notice the product page offers a star-based review system whereby people who have read the book are able to review it.

This represents the traditional attempt by retailers to reduce customer anxiety about their purchase and increase credibility of the product by allowing real people to give their unfettered opinions of the product. The problem, of course, is the Forrester report has introduced an element of doubt about how effective consumer-written online reviews are at influencing the purchasing behavior of individuals shopping online.

Let’s compare Amazon’s attempt to assuage anxiety to another approach, below:

I really like this example of integrating a Facebook comment into a product page because it illustrates the potential for using social media to build your products’ credibility. The widget will allow anyone to comment on your product or service, provided they have a Facebook account.

The widget can be coded to display socially relevant results first. In other words, you can show any comments from your customers’ friends and relatives at the top of the list, and as we’ve discovered, the recommendations of friends can be much more trustworthy.

The only problem I can foresee with this approach is having a lack of comments on a particular product.

Could the Facebook commenting process be so foreign to people that it scares them away?

Do customers understand this is the functionality that they should use to leave a recommendation?

We don’t have answers to those questions.

It seems as if we’re left with a valid research question: which attempt at alleviating anxiety and boosting credibility will be most effective?

Will it be the traditional user-based “star” concept that made me sick, or the socially empowered “friends and family” approach?

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Once upon a time, I was the new kid at school. Since I was a fairly athletic kid, I soon found myself in the midst of a pickup football game at recess. Imagine my horror when, despite my lack of knowledge about the competition, I was selected as a team captain.

I remember asking kids to explain to me, as quickly as possible, why I should choose them for my team. Some kids gave excellent reasons. “I’ve got good hands,” says one. “I’m the fastest kid here,” chimed in another. Many of the kids, however, never offered any answer to my question. Some of them ended sitting out the game because they couldn’t articulate why they should be picked. In football, as in social media, the key to getting picked is selling yourself.

You’re probably used to selling your products, but do you sell your social media?

Here’s what I mean.

How does value proposition relate to social media?

The fundamental value proposition question is:

“If I’m your ideal prospect, why should I buy from you rather than any of your competitors?”

I’ve even heard the phrase expanded in an academic environment to include this add-on phrase: “or do nothing at all?”

The “do nothing at all” is an important distinction because given a set of equally depressing options, a consumer may elect to forgo any product purchase at all.

Therefore, the smart companies tailor product development efforts in such a way the value proposition question produces a satisfying answer in regard to product offerings.

This leads me to another important question.

If product developers know that answering the value proposition question effectively is the key to successful product development, then why can’t a similar logic be applied to your social media efforts?

Whose problem are you solving?

The biggest problem I see with most social media marketing campaigns is usually a paradigm problem. It’s also the primary reason why a company won’t ultimately become successful in the medium.

When companies launch marketing efforts, it’s generally to boost sales. But social media, however, is only successful when content solves a customer problem, not a lack of sales problem.

In other words, most companies are not asking the right value exchange questions. Let’s take Twitter for example.

The prevalent mindset is a company-centric focus of “how can we sell products using Twitter?” instead of a customer-centric focus on “why should potential customers engage our Twitter feed rather than any of our competitors’?”

Consequently, it would do well for marketers to stop and ask the fundamental question, “Is there any true value in our marketing proposition?”

From my experience, when marketers begin to ask these deeper questions about their social media content, the conversational ratio of their posts begins to change – usually for the better.

Here’s another fantastic illustration of my point.

Do this:

Not this: 

Notice how Publix has given the visitor a solution to their problem of wanting to eat more fish. They’ve included a free fish recipe, and a mouthwatering image of a completed meal.

The value of this post is clear and easily recognized. I want to engage with this content because doing so will enable me to cook a great fish meal for my family and achieve my goal of eating more fish.

The hoodie retailer, on the other hand, clearly has no answer to the question of why a user would want to engage with the content. Other than the gratuitous pandering about Saturday tailgates, the retailer makes no effort to solve any problem for the customer.

It even goes as far as to command the customer to “shop now.” Anybody who’s ever crafted a call-to-action knows that dog won’t hunt.

This post is designed to solve the retailer’s problem: the need to sell hoodies. It holds no value for customers whatsoever.

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My wife would prefer it if I avoided Vegas forever.

I like gambling a lot and I’ve got a history of big bets. It scares the heck out of her when I plop down $1,000 in chips on a hand of blackjack. And yet, I hardly ever lose money.

Let me explain …

I spend hours playing the safe, boring hands. I make logical decisions. I slowly build up a big stack of chips. Then, I double down on a big bet and have more fun and excitement in one hand than most people have the whole weekend.

But, the point to my strategy to remember is that I never make those big bets until I’ve “saved up” enough chips for it not to matter whether I lose or not.

And, good content marketing is a lot like blackjack. Here’s why.

What are you talking about this time?

I’d like for you to think of your clout with the readers on your content marketing platform as a stack of chips. Every day, you’re producing useful, engaging content. You’re packing utility and value into every post and picture and video. You’re painting the proverbial fence, and growing your stack of chips.

Why? Because you eventually want to promote a product and doing so will require you to cash in a huge stack of those chips.

If you build it, they will come. If you sell, they will leave.

When done well, content marketing is remarkably product agnostic when you really think about it.  There is no selling involved because selling runs contrary to the primary purpose of content marketing, which is to become a trusted resource.

By building credibility with an audience as a trustworthy source, brands have been able to later leverage that trust, which can be viewed as a subconscious chip stack.  They’ve accumulated with readers at a strategic time to say “We’ve never tried to push any of our products on you, but we’ve got something you really need to see.”

And, that one sales pitch will cost the whole stack of chips. You can’t market your products directly to readers, despite the term “content marketing.” At least not with any real frequency.

Otherwise, they’ll stop believing your voice and trusting your brand.

John Deere understood this when they launched The Furrow, arguably the first recorded attempt at content marketing, back in 1895. They didn’t send out a catalogue of farm equipment. In fact, they didn’t mention their products at all.  Instead, they set out to make themselves useful to farmers by producing a guide to teach business principles and new farming technologies.

As it turns out, when a company becomes a trusted source of information in your industry, it makes sense to trust them to provide your equipment as well. But, John Deere never said that outright. Content marketing is more subtle than that. They simply produced valuable content and trusted farmers to make that connection on their own over time.

Or, for a more modern example, look at Red Bull.

If you visit RedBull.com, you’ll see extreme sports, surfing videos, skateboarding tricks, music reviews and a veritable who’s who of 20-something countercultural superstars.

In fact, Red Bull has become such a resource for this core demographic that their website is actually a destination for seekers of fresh, updated content on extreme lifestyles. What you won’t see are articles touting the benefits of Red Bull, the great taste or the wide margin by which the brand outsells its competition.

Red Bull is perfectly happy simply slapping its logo on the skateboards of some of the greatest tricksters on Earth and let kids make the connection on their own. There might be the odd banner ad for Red Bull products, but the content is carved out in a separate silo which is product agnostic.

Just for fun, I reviewed a bunch of top content marketing initiatives – everything from Red Bull to Procter & Gamble’s Petside and Being Girl initiatives. In all, I read more than 100 content marketing articles at random.

Do you know what most of them had in common?

More than 89% of the articles never mentioned a single product related to the company producing the content. They were virtually all product agnostic to the core. General Mills’ Tablespoon platform might offer great recipes which could conceivably contain its products. They might even show a picture of a product in the “ingredients” photo, but they stop short of shoving the General Mills brand down your throat. You’re left alone to eventually connect the dots on your own. If General Mills cares enough to give me all of these recipes, they probably care enough to make superior products as well.

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When I first graduated from high school, I took a job at a day care.

I was hired initially because I made it my personal goal to sign up as many kids as possible for our services. Of course, the responsibilities of more children under your supervision solves one set of problems while creating new ones.

One thing I quickly learned is that it’s pretty tough to convince a large group of kids to take a nap without using bribes of their preferred currency … chocolate.

So needless to say, my employment at the day care was brief because my true value as an employee was not just based on increasing volume, but also on how effective I was at engaging the volume that already existed.

Social media goal setting

A lot of marketers who have been conditioned by years of hard time spent in the midst of the media industrial complex hold the belief they should run their social media campaigns like I was running the day care – by taking a “more is always better” approach.

The idea behind this belief is simple.

Consumers who use Facebook have eyeballs. Therefore, the more eyeballs I can put onto our brand’s social media page the more “awareness” we can create which should eventually result in more business.

Because more is always better, right?

Fun with algorithms

The biggest problem with taking a “more is always better” approach to your social media marketing is a rooted assumption that all of your Facebook followers will see all of your content every time you post something.

Unfortunately, that’s simply not true.

Take our MarketingSherpa Facebook page, for example. On average, our posts reach somewhere around 15.26% of our followers on a given day, depending on the type of content.

So how can that be?

In three words … Facebook curates content.

According to Hubspot, the average Facebook fan spends about 40% of their time on the newsfeed as opposed to just 12% spent on profiles or brand pages. That margin makes the newsfeed the center of the Facebook universe.

So, to ensure that people have the most enriched newsfeed experience possible, Facebook curates content based upon on their homegrown algorithm known as “EdgeRank.”

There are three components to EdgeRank, wherein:

• U = Affinity: which takes into account the past relationship between a Facebook user and your brand

If a user has interacted heavily with your social media content on Facebook previously, then it’s very likely they will see your next content offering in their newsfeed.

• W = Weight: which relates to the types of content you have created. Some users prefer images while others may prefer text or video

The more a user interacts with a particular type of content through likes, comments and tags, then the more likely their preferred content types will appear in their newsfeed. If a user likes all of your pictures, then they will likely see the next picture your brand posts.

• D= Decay: which is typically never a good thing

The older a post is, the less likely it is to appear on the newsfeed of a Facebook follower.

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How can you track the most impactful elements of your marketing funnel? Let’s start with an analogy …

I once had a crush on a girl.  I talked to her every day, but she rarely took notice of my existence.  She liked the “bad boys,” and I was kind of a nerd.  It seemed as if the stars were aligned against us.

I tried asking sweetly, coming up with inventive date ideas, even appealing to her sense of pity, all to no avail.  Finally, after a year or so of trying, I wrote her a letter telling how I felt.  She finally accepted my invitation and we went on a date.

My takeaway from this exchange was letters work best. (Admittedly, my letters are particularly awesome.)

What I didn’t know was my letter had relatively little to do with her decision.  Years later, I asked her why she finally decided to go out with me.  She admitted my persistence played a role, but the bigger factor was how she had her heart broken by one of the afore-mentioned “bad boys,” and decided to give a nice guy a chance.

I was floored.  I had no idea these events had ever transpired, and more importantly, had vastly overestimated my letter writing ability.

What I had was essentially a last click attribution model. This is the way in which countless organizations currently measure conversions.  We, as an industry, have come a long way in terms of being excited about measuring and testing our marketing efforts.

However, looking at the last click before conversion as a sole contributor to the conversion decision is as near-sighted as assuming the young lady accepted my date invitation based upon my letter writing skills.  The letter was a factor, but it wasn’t the only factor.

I need a better model.

Where should I spend my marketing dollars?

Using the last click attribution method, I can determine the value of a conversion generated from an email campaign.  I might arrive at the conclusion my marketing dollars are best spent on building email lists and optimizing email campaigns.

While there may be truth in that statement, it’s only partially correct.  The real story in this scenario might be a customer first interacted with my brand when a friend shared a product review on Facebook.  From there, a likely scenario of events could be:

• The customer visited and liked my Facebook page, and then left.
• Weeks later, I launched a new product via Facebook post.  The customer saw the post and then left the platform to do some research.
• While researching the new product on Google, a PPC ad appeared and convinced the customer to click through to my site.
• Once on the website, the customer joined my email list.
• Two weeks later, I sent an email which the customer subsequently viewed and converted, purchasing my product.

From this example, it’s obvious the customer was nurtured to conversion through a series of interactions including social media, PPC, landing pages and email.  Now, how much of my marketing dollars should go to each channel, since in this case, they were all obviously necessary for conversion?

Attribution models

Solving this problem requires the use of a different attribution model, and not all attribution models are created equal. I remember how happy I was when I learned there were multiple varieties of steak.  I had always eaten sirloin, because that’s what my dad always cooked.  So, you can imagine my excitement the first time I tasted filet mignon!

Similarly, there are a wide variety of attribution models to suit everyone’s taste.

One example is the linear ratio model, which is a dynamic model that attributes different values to different purchase and research phases. For instance, it might:

• Attribute 5% of revenue to Facebook for the research and awareness piece of our sample transaction above.
• Assign 25% of that revenue to PPC ads.
• Finish by assigning 70% of the attribution to the email campaign that caused the click.

There are many  implications to using a model such as this. The social media manager is very happy because he just went from being a nonexistent entity in this conversion to owning 5% of the revenue.

The email manager might not be quite as happy, but the marketing executive should be thrilled.

There are many more models to experiment with. First-click, U-shaped, custom models and linear modeling are just a few. We’re getting closer to really understanding why people buy our stuff, and how they arrive on our pages.

Moreover, we’ve attributed our revenue to particular interactions along the funnel, which should get us started in the process of assigning value to each marketing activity we undertake.

To learn more about each of the above attribution models, see Google Analytics’ definitions here.

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E-commerce on Facebook was a horrible flop. That is to say, many brands found over the course of several years of experimentation the return on investment in terms of dollars spent developing their online storefronts didn’t measure up, so many of the most popular retail brands – such as The Gap, JC Penney and Nordstrom – were subsequently forced to close their Facebook shops. A recent study by W3B suggested just 2% of people with a Facebook account have made a purchase on the social network.

Yet, simultaneously, e-commerce sites in general (Amazon, Fab.com, etc.) have posted impressive growth figures.  For example, holiday e-commerce sales were up 13% to $34 billion in 2012.

Why is it that some sites sell, and others don’t? In particular, why are social media sites so horrible at conversion? I believe it’s a phenomenon related to (what I refer to as) the locus of conversion.

Facebook is a pub crawl

The environment on Facebook yields similarities to the dynamic of a pub crawl. Surrounded by acquaintances and, yes, a few old friends, we dive into topics of various levels of seriousness ranging from the patently absurd, to the politically charged before wandering aimlessly from topic to topic.

We do so without expecting to be inundated with marketing messaging, much the same as we would expect to not be rudely interrupted by an insurance salesman while we were in the middle of telling our best frat house story from college at the local bar.

However, if you are able to be interesting enough to become the topic of our buzzed conversation, I might be willing, in that instant, to purchase your product. I don’t want to leave the bar, mind you. I just want a magical product genie to appear and offer your purple widget to me at a reasonable price. If I don’t have to leave my bar stool, you just might have a sale.

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When I was a kid fresh out of high school, I was a little socially awkward. I didn’t exactly understand the various types of social gatherings to which I was invited to, and I consequentially always showed up dressed incorrectly, saying the wrong things and bearing the wrong gifts. We all know the guy who shows up to the baby shower with a bottle of tequila, right?

Unfortunately, a similar situation exists in marketing circles when advertisers crash the proverbial wedding of social media platforms wearing board shorts and flip flops. That metaphor may be a little dense, so follow me…

For all of the analysis currently existing about how to best leverage social networks for marketing success, we actually understand comparatively little about how the various platforms work. Frequently, despite best efforts to the contrary, marketers end up looking like the odd man out simply by taking the wrong platform-specific tones with their campaigns.

Companies simply can’t expect to behave the same at different social functions and receive an overwhelmingly good response. Since we’re on the analogy train today, I’ll try to keep the theme going.

Facebook is a pub crawl

People spend most of their Facebook time interacting with their “friends.” In truth, most of the “friends” with whom we interact with on Facebook are merely acquaintances.

Nevertheless, the environment yields similarities to the dynamics of a pub crawl. Surrounded by acquaintances and, yes, a few old friends, we dive into topics of various levels of seriousness ranging from the patently absurd, to the politically charged before wandering aimlessly from topic to topic for a spell.

We do so without expecting to be inundated with marketing messaging, much the same as we would expect to not be rudely interrupted by an insurance salesman while we were in the middle of telling our best frat house story from college at the local bar.

In order to market effectively on Facebook, you first have to win a seat at the table, or be interesting enough to be the topic of our slightly buzzed conversation.

Twitter is a speed date

You’ve got 140 characters to impress me, so you’d better make it work for you.

I might spend a few extra minutes after the last round of speed dating with a particularly interesting person (company, product, etc.), but if I do, it will be because you have done or said something particularly compelling in your allotted time slot.  Equally as fun as interviewing potential dates, I can wander sneakily around the room to see what other people are saying about me …

“That guy has impeccable taste in clothing,” says one. “He’s stunningly good looking,” says another.

Brands can do the same with Twitter, getting a better idea of how the market is responding to their product offerings. In order to market on Twitter, you have to learn how to answer the question of what you’re into right now, and answer it in a compelling enough fashion for me to care when you’re done talking.

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I was a fat kid. Fat kids like cake. Once upon a time, when I was eight years old, I cleaned the entire house to surprise my mother. She rewarded me with a gigantic slice of cake. From that point, I scrubbed the entire floor, organized the pantry and washed the dishes in pursuit of that glorious reward — fresh cake.

The point is, if you do something right, and you recognize the relationship between your actions and the reward, it makes sense to put forth maximum effort to reproduce the action that resulted in being rewarded. The problem with social media efforts is that success usually goes largely unnoticed by businesses.

Find your hidden cake

I recently conducted a social media audit for a Research Partner. While working through massive amounts of data provided via Facebook Insight reports, I noticed something interesting. When filtering the most frequently syndicated content to reveal the five most viral posts ever produced by that partner, a pattern emerged. Three out of the top five posts were on the same topic, in the same format.

There’s more. The top five most syndicated posts averaged 22,424 stories created per post by users, whereas the bottom half of the top 10 averaged only 6,042 stories created per post by users.

So, not only were the top five posts more effective at causing syndication from users, but they were 371% more effective.

Since no fat kid would knowingly forgo cake, it’s probably a pretty safe assumption that no business would knowingly do less effective social posting if they knew they could be doing something more effective. (After all, cash is better than cake.) That means the company must be unaware of its achievement.

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All content is not created equal. For instance, according to a Nielsen report, men spend more than 247 million minutes per month viewing video via social media. Yet, women spend just 228 million minutes, despite the fact that more than 4,000 more women log on to social videos per day. Men just watch longer. If you want to engage men, videos are a superior form of content.

The still photograph remains king of the proverbial hill in terms of generating engagement with fans on social platforms. A 2012 study by ROI research found that 44% of users are likely to engage with brands if they post pictures, against 40% for regular status updates, and just 37% for video. Given that startling piece of information, a reasonable person might be led to ask the question:

Are all photographs created equal?

Do grainy, low-quality photographs thrown into a Facebook stream, more or less as afterthoughts, have the same impact as high-resolution, high-quality photography? Does it matter if the content is only photographic, or do graphical images also generate higher engagement numbers? Let’s look at one industry that is quite popular among the coveted 18-24 demographic on Facebook: entertainment (the companies shall remain nameless).

We begin by dividing the image content of several popular pages into two broad categories. First, there is the professional category. Images in this category tend to be high-resolution, feature-striking photography, be character based and contain only those graphics absolutely necessary to convey essential data. For example, look at the following image:

Click to enlarge

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Everyone has been playing social media ROI hide-and-seek for some time now. How does social media drive sales? Does the extent to which a firm engages or fails to engage in social marketing impact the bottom line at all? Or, as some have suggested, is the return on social efforts akin to the Loch Ness monster — we’re pretty sure it exists, but nobody seems to be able to track it down.

 What if we’re looking at it from the wrong perspective?

What if social media is more of a process, a series of steps taken at every point in the sales process, which, in totality, makes it more likely to convert leads to clients but, in practice, is difficult or impossible to measure? Or, what if social media has to be done for a certain amount of time and at a certain level of devotion before those benefits manifest?

For instance, a recent study by Dr. Sounman Hong of Harvard University suggests that newspapers’ adoption of Twitter is positively associated with their number of online readers (readers = revenue, right?), and that the strength of the association increases the larger the social network is.

Common sense seems to suggest that social subscribers are added over time, and that a bigger subscriber list, in most cases, indicates a more mature social presence. In other words, we grow into our ROI by continuing to paint the fence and mature our social media efforts.

Another recent study, this one by James “Mick” Andzulis, Nikolaos G. Panagopoulos and Adam Rapp, goes so far as to break this social media evolution down into practical subdivisions. Now we begin to see a pattern emerge. Their take is that our social media efforts evolve though a series of four phases:

Click to enlarge

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