PR 101

There has been a debate raging over the future of the Internet for the last year or so. However, I don’t most people have even heard the term net neutrality, let alone had the time to delve into the subject. Yet in my opinion, if the debate goes one way, it will change the way all of us use the Internet. It will divide the web into groups of haves and have-nots.

Some Internet Service Providers (ISPs) want to create a two-tiered web. According to Wikipedia “neutrality proponents claim that telecom companies seek to impose a tiered service model in order to control the pipeline and thereby remove competition, create artificial scarcity, and oblige subscribers to buy their otherwise uncompetitive services. Many believe net neutrality to be primarily important as a preservation of current freedoms. Vinton Cerf, considered a ‘father of the Internet’ and co-inventor of the Internet Protocol, Tim Berners-Lee, creator of the Web, and many others have spoken out in favor of network neutrality.”

Wikipedia goes on to define net neutrality as follows: “Network neutrality (also net neutrality, Internet neutrality) is a principle proposed for user access networks participating in the Internet that advocates no restrictions by Internet Service Providers (ISPs) and governments on content, sites, platforms, on the kinds of equipment that may be attached, and no restrictions on the modes of communication allowed.” Ian Paul wrote in the online edition of PC World that “Network neutrality is the principle that broadband providers should not be allowed to discriminate or restrict Web traffic based on its content.”

The bottom of those advocating net neutrality is that the Internet should remain like it is currently. Open access and no restrictions whether you are paying $10 a month for your access or $100 a month.

Paul goes on to note that what ISPs are asking for is the right to maintain a so-called private Internet to provide new services. Some examples of what private broadband services could be include health care monitoring, educational services, gaming and other forms of entertainment. This private service would be separate from the regular Internet.

What that means in practice, at least to me, is that some people are going to find that they cannot afford the new services. And that ain’t right.

Think about this from a social media point-of-view. A lot of social media involves video. What happens to a small company who finds that video is the best way to get out their message? Videos take a lot of bandwidth. A lot of ISPS don’t like video because its bandwidth demands. There are discussions about charging more for sending large files. Could a new company afford to market itself with a higher priced web?

One of the great things about the Internet is how it has given people who have never had a voice before a chance to say something. Think of all the governments that have been overthrown because people had ways outside of official channels to communicate. Look how people in this country has used the ‘Net to make themselves heard.

Or it could be as simple as finding out it will cost you more to download music because of the amount of bandwidth it takes. Online gamers might find themselves paying more to access such things as World of Warcraft.

What is particularly scary to me is how wireless access is being left out of the discussion. Earlier this month Google and Verizon released a proposal to maintain an open Internet while creating room for a broadband network of premium services. (my emphasis.) It left wireless out of the verbiage.

Doesn’t seem like that big of a deal. Morgan Stanley analysts predict that in five years more people will be going line via wireless access (smart phones) than computers. As the New York Times reported, as ISPs earn more revenue from private services, “they might have less incentive to invest in Internet capacity, pushing more content providers to these special services and creating alternative networks that look similar to cable TV.” And cutting many people out of the best parts of the Internet.

This scares me. It should scare you too.

It surprised me to find out our institutions of a higher learning are just now diving into the social media pool. It’s true that social media as a separate marketing method is only about five-years-old. However, I always look to college campuses as the earliest of adopters. I find it odd that universities are currently almost last to climb into the cutting edge.

Still, although they are late to board, the institutions of higher learning haven’t missed the social media train,  a recent study found.

The study, “Marketing Spending at Colleges and Universities” found that higher education institutions’ interactive and social media budgets are increasing. Between fiscal year 2008 and fiscal year 2009, 55 percent of the institutions allocated more of their budgets to interactive media and 52 percent allocated more to social media.

The study was conducted by the Council for the Advancement and Support of Education (CASE) and Lipman Hearne, a marketing communications firm with offices in Chicago and Washington, D.C.

“People really want to know what kids are reading and how they spend their free time – what is capturing their attention,” Lipman Hearne’s COO and director of research, Donna Van De Water is quoted in the report. “They’re trying to figure out what kinds of communications should move from print to the web. And they’re wondering what kind of language to use. They’re asking, “Should we use a student voice or our own voice?”

It is important to remember almost college students first used every social media application I know of. Student, for goodness sakes, developed Facebook at Harvard for use by other students.

Yet, colleges and universities are just now catching onto the fact that they need to be recruiting using social media?

Of course, people who demand facts and figures run most universities. They want definite empirical proof that something is working. The study does bear that out. It found that institutions that use social media report positive incomes in website hits, search engine positioning and, most importantly, rates of alumni donations.

The study also found something that should be music to a university comptroller’s ears: moderate-to-heavy users of social media spend less per student on marketing. The moderate-to-heavy users spent an average of $83 per student as opposed to the $121 per student that light-to-non-users of social media spent. In addition, 71 percent of those institutions who invested in market research and strategy reported those efforts have a positive effect on the quality of their applicants.

“Students tend to say that they want to hear the university’s voice,” Van De Water said.  “Students know if they’re being talked down to, or if their own voices are being mimicked. That said they still do want to hear a student’s perspective. So an institution needs to know what its own voice is, yet also allow students to represent the authentic student voice. Alumni want to hear a range of voices: faculty, students, other alumni, and the university’s. They understand and appreciate the complexity of the institution and welcome the various perspectives.”

In addition, the increasing use of social media has allowed colleges and universities to cut the amount of money they spend on traditional advertising. Of those institutions that are moderate-to-heavy users of social media, 42 percent spent less on traditional advertising in fiscal year 2009 than in the previous year. Of the overall survey group, approximately one-third spent less on traditional advertising than in the previous year.

So as I long as I am continuing in cliché mode, I guess it is better late than never.

I had an amazing response to the two-part guest blog on why executives hate social media. My weekly readership more than doubled. I did have a few complaints that it was too long or needed better editing. Both are good points.

Nonetheless, it raised a lot of provocative points about the C Suite and social media. I appreciate that all of you took time to read through it. Plus, I had a lot of comments. It was a good debate. Thank you all.

This is part two of social media firm DemingHill’s blog on why executives hate social media. For more information on DemingHill, click on their name.

It’s high time that a C-level individual engaged in social media, and – once and for all –created a high-level overview and synopsis, crystallizing all of the strategic benefits and critical value streams, and distilling them into a language that speaks to executives everywhere in our native tongue – bottom line stakeholder value. So here you go. I’ve done the work for you. What follows is an “Executive Summary” of my findings.

Social Media Value #1:  Unfiltered Feedback

As you already know, some of the scarcest (rarest) yet most valuable information a CEO can obtain is honest, unfiltered feedback. Think about it. You interact all day with managers, employees, and handlers working to keep the boss happy and therefore keep their job. Sure, being surrounded by “Yes men” can be more comfortable, but it can also insulate you from the stark realities of your business. If done correctly, social media enables CEO’s to hear raw, candid feedback from real people – people who aren’t afraid of being fired because they CAN’T be fired. The truth is, leaders with their ego in check are already fully aware that they work for the customer – the customer is his boss – so if the customer doesn’t like dropped calls on their iPhone or the sauce on their Domino’s pizza, it’s their job to make it better.

Now, every customer is not always right (or wrong), but if 850 out of 1000 user comments say tthe new Sketcher’s Sport shoe caused them to sprain their ankle, then something needs to be fixed – and fast! CoolCleveland’s Founder Thomas Mulready is a perfect example of a CEO with this customer orientation. After emailing out his weekly eMagazine for 7 years, he decided that it needed to be updated, and set about introducing a new format with much fanfare. In doing so, he also did something revolutionary – he asked all 90,000 of his readers for feedback on what they thought of the new style – and boy did they reply with scores of comments submitted over the span of a few days. But then he did something else revolutionary – he actually listened, modifying and improving the new site to reflect reader tastes and preferences. Yes, it takes humility (“Who are these people to give me feedback?  I invented this product! Don’t they know they can just click the links?) but the end result is an engaged audience who now feel genuinely empowered to provide even more feedback, emboldened by the knowledge that their comments actually impact (and can improve) the end product.

Social Media Value #2:  Authenticity

Hand-in-hand with the unfiltered feedback above is the ability to leverage social media to authentically communicate with your employees, partners, customers (and non-customers), investors, and media, directly engaging all of your brand ambassadors efficiently and economically. Rather than layers of staff, spokespeople, and sterile press releases, social media now offers an elegant and effective medium for disseminating information either “straight from the heart” or “straight from the horses’ mouth” depending on your preferred idiom. Dan Gilbert’s recent LeBron James “rant” would qualify as both, capturing the owners’ anger, frustration, and competitive resolve just moments after James’ announced his departure. As you’ve probably noticed, nobody can tell the company story and embody the company brand like the CEO (think Steve Jobs) and by offering the ability to immediately and directly engage stakeholders – whether on a typical day, during a product launch, and/or especially during a time of crisis – social media provides an invaluable medium for maximizing brand value and minimizing potential brand degradation. Social media helps firms “keep it real” but couches it in a positive brand-reinforcing context.

Social Media Value #3: Six Sigma (Low Cost)

In case you were wondering, executives LOVE things like Six Sigma because:

1. It reminds us of our Greek fraternity days in college.

2. The other soccer dad’s don’t understand Value Stream Mapping.

3. Six Sigma and lean processes are all about speed and cost sacvings, two of our favorite topics.

By its very architecture, social media is positioned to leverage firms’ Six Sigma orientation by expediting interactions, exchanges, customer service, feedback loops, product launches, marketing, and advertising, and enabling it at a fraction of the cost of traditional media, to a much more targeted audience, and in a far more nuanced and contextual value exchange. Social media options allow your message distribution format to evolve from shotgun to sniper, from billboard to message board, and from broadcast to narrowcast.  Plus, it takes your marketing posture from a one-way, blanketing, bullhorn approach to a more intimate, just-in-time interaction; offering the opportunity for a more detailed, valuable and more profitable conversation and connection with your audience (and you don’t need a Black Belt to do it).

Social Media Value #4:  Balancing Transparency AND Privacy

The only thing worse than not using social media tools is using them in the wrong way. Your firm could very easily invest time and money on social media, and then end up spending even more time and money doing damage control because you did it wrong the first time – talk about a lose-lose situation. With social media, there’s a “right way” and a “wrong way” to do things – so if you’re going to do it, do it right. Remember, anywhere-anytime-anyone social media channels must be handled as the “nuclear options” that they are, with the capability to destroy your brand value in a single Twitter, email, or YouTube video that goes viral.

With great power comes great responsibility, and a healthy respect for the global reach and impact of social media must emanate directly from the CEO, who knows better than anyone that the same programs allowing firms to connect and influence the marketplace can also be turned against you to alienate them. And just as social media can provide the market with a transparent window into the soul of your company, it can also showcase you at your worst, doing more harm than good.  Let’s face it, your firm is already dabbling in social media as it is – so you might as well manage your risk and liability by codifying corporate expectations, establishing specific ground rules, and educating your stakeholders regarding proper use of these seemingly innocent yet powerful tools.

Social Media Value #5: Supporting Statistics

Executives rely on market research to support and substantiate any designated course of action, and devour facts, stats, and data-points like shrimp at a wedding reception. Summarized below are a few statistics buttressing the explosion of this social media trend, and detailing how Corporate America is leveraging it to realize significant revenue and market share growth going forward.

• In the last 7 years, Internet usage has increased 70 percent a year. Spending for digital advertising this year will be more than $25 billion and surpass print advertising spending (forever)

• Lenovo has experienced a 20 percent reduction in activity to their call center since they launched their community website for customers
• Blendtec quintupled sales with its “Will it Blend” series on YouTube
• Only 18 percent of traditional TV campaigns generate a positive ROI
• Naked Pizza set a one-day sales record using social media: 68 percent of their sales and 85 percent of their new customers came via Twitter.
• Software company Genius.com reports 24 percent of social media leads convert to sales opportunities,
• Dell has already made over $7 million in sales via Twitter.
• Thirty-seven percent of Generation Y heard about the Ford Fiesta via social media before its launch in the US and currently 25 percent of Ford’s marketing budget is spent on digital/social media.
• Seventy-one percent of companies plan to increase investments in social media by an average of 40 percent.
• A recent Wetpaint/Altimeter Group study found companies that widely engage in social media surpass their peers in both revenue and profit.

(Sources for Statistics: meyersreport.com, lenovosocial.com, George Wright, Blendtec, Mashable.com, econsultancy.com, businessweek.com )

Getting Your Board On Board

Lest we forget, even the Boss has a Boss – they’re called the Board of Directors – and these are the people that recruit and hire CEO’s for the purpose of serving as a charismatic and visionary leader of their organization. And so I urge you, don’t disappoint them when it comes to leveraging social media within your organization. The “Bang for the Buck” value proposition is too compelling to ignore, and the fact is – your competitors are already entering this arena and establishing new service baseline norms and minimum threshold expectations – so standing still amounts to losing ground and therefore is not an option. What you need is a plan.

Do I still hate social media?  No, but I’m only going to embrace it on the “executive terms” that have served me so well to this point in my career and they are, “If you’re going to do something, go all in and do it right.”  From now on, all social media, social marketing, and social networking will be discussed in the context – not of a campaign (which starts and ends) – but as part of an ongoing, strategic, and systematic dialog with our stakeholders and marketplace.

Executives have the focus and vision to road map strategies playing out three, five, and 10 years into the future. But, we’re also “plodders” and are comfortable with short, measured, consistent steps – day in and day out – as long as we know that they are aligned with reaching a desired goal. When we discuss your social media strategy, the focus will be on consistency and sustainability over the long haul. Remember, executives don’t have the ego needs, risk profiles, or the time to be on the bleeding edge, or even the cutting edge. We just want it to work.

I can confidently predict that every month for the next 100 years there will be a new “Must Have” application, portal or community that one of your employees will discover, and then try to convince you that your company will implode if you don’t immediately join, link, or Retweet. In five years, all but three of these ideas will probably be forgotten.  During our meeting, we will discuss how to frame out an enterprise-wide social media strategy, predicated on the foundation of proven tools and that have stood the test of time and offer “Best-In-Class” results, so that you will be empowered to handle these conversations proactively in the context of a larger road map, rather than reacting to these weekly ambushes in a dismissive defensive way. Remember, our goal for social media is not a lark, but a lifestyle and work-shopping a strategy which builds on stable, scalable tools, yet also affords the flexibility to address unprecedented “Black Swan” technology developments, provides you with a welcome buffer from being whipsawed by a weekly website.  Between the two of us, we’ll finally take that reliable “80/20 Rule” and apply it to social media, and then spend time focusing on the 80 percent of stakeholder value that can be extracted with 20% of the effort (while knowingly and purposefully ignoring the remaining 20 percent of value which takes up 80 percent of the effort).

The Bottom Line

In the Forward of Geoffrey Moore’s bestseller “Crossing the Chasm” Regis McKenna writes:

“Fundamentally, marketing must refocus away from selling product and toward creating relationships. Customers don’t like to be ‘owned’ if that implies lack of choice or freedom. But they do like to be ‘owned’ if what that means is a vendor taking ongoing responsibility for the success of their joint ventures.  Ownership in this sense means an abiding commitment and a strong sense of mutuality in the development of the marketplace. When customers encounter this kind of ownership, they tend to become fanatically loyal to their supplier, which in turns builds a stable economic base for profitability and growth.”

While there will always be a “me” in media – social media, social marketing, and social networking tools were designed to work best as a conduit for enabling information exchange, establishing a dialog, and creating a two-way conversation with your audience. At the end of the day, social media is simply about creating and maintaining relationships – and even and executive can do that.