Milken Institute Global Conference: Power and Economics of Social Media (Summary)

The Power and Economics of Social Media (click to view list of participating speakers and video)

At the Milken Global Conference 2011, a panel of social media experts discussed where the various social media platforms have taken businesses so far—most of which are only beginning to see how drastically social media can be used to influence consumers, both now and in the future.

If you don’t have an hour to watch the video, here are our takeaways:

SOCIAL MEDIA IS CURRENTLY:

• An opportunity for businesses to capitalize on; exactly to the extent of which is still beyond most of our grasps. People are consuming more and more media every day.
• A way for businesses to see customer communications as never before and use that information to their advantage.
• Enabling businesses to go from zero to a million customers faster than ever before possible.
• An opportunity for marketers to be more relevant, target their specific audiences, and allow word-of-mouth recommendations of trusted connections to replace traditional marketing.
• Like sending an email with a BCC to the whole world (for example, a Tweet). Customers used to have the potential to recommend a product to maybe 10 people—now they can reach 10,000.
• A very complex space still in its infancy. As Bonin Bough puts it, “the Internet hasn’t even reached puberty.” And yet, the mainstream is already on board.
• Full of different channels developing and merging every day. Companies need to be prepared, and use them to continue to deliver on business in the most effective way.
• Replacing the traditional “comment cards” which only 1% of customers ever bothered to fill out.

COMPANIES CAN CAPITILIZE BY:

• Understanding their strategy should not be “one-size-fits-all.” Companies must figure out the best way to mine and harvest social media to their advantage.
• Developing a credible social media presence across the board (on each site), and having a different strategy for each that integrates the revenue drivers of the business.
• Not just hiring one social media employee; but becoming “listeners” as an entire organization and maintaining a human touch. “Communication management” and “digital fitness” are new skillsets needed in order to adapt.
• Utilizing companies like www.newbrandanalytics.com (represented in panel) that monitor open conversations going on in social media to determine what is being said about their clients and the product/service they provide. They then give clients that feedback, which can be used to change the negative perceptions of their business, enhance the positive ones, and develop products accordingly. (Even the US government is using these services to get feedback from citizens about things like potholes and parking meters.)
  • These companies can also reach customers by monitoring their conversations to determine their needs—in a way reading their minds. For example, if a relationship status changes from “married,” divorce mediation ads can automatically start showing up. In this way, companies are getting to their customers before the customer can even do a Google search and sift through choices.
  • Gatorade (represented in the panel) has a “Gatorade Mission Control” center of eight monitors showing real time data of relevant conversations customers are having, so they can participate in—and influence—those consumer conversations in real time.
• Becoming more transparent, and acting fast. Social media is like WikiLeaks for businesses; everything is out there.
• Using the knowledge they can now have about what customers want to quickly turn and adapt their product. According to Bill Gross, “If the old world which turns on inventory, the new world turns on ideas.”

BUILDING A FOLLOWING REQUIRES:

• Being a valued participant in the conversation, and having quality content and actions—just like in real life.  Connect people with other people, and put valued information out there.
• Authenticity in customer relationships—meaning businesses can’t just hammer the customer with information about how great their product is. They must provide useful information in general, with a side mention or end result of their product.
  • In order to be authentic, a real passion has to be there. Make sure those putting out content have a true passion for the product/service/subject matter.
  • You can’t have one foot in the door and the other out; you must update sites often and participate in those conversations if you expect people to keep coming back.
• Keeping on top of emerging technologies and new platforms early, so you can be prepared and start to develop a following on the new site immediately.

IN THE FUTURE, THE PANELISTS PREDICT:

• Search engines will be able to give results not just chronologically, but based on insightfulness of the information.
  • They will also be able to give you information based on the recommendations of your social network.
• People will be able to take their entire “social graph” and go to a different network, and still maintain all the same connections.
• Large companies will put the right incentives with the right technology to develop giant platforms.
• Social media will become much more local and specific.

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