This week as part of our executive series, I talked with CEO and one of the original founders of Collective Intellect, Don Springer. He provided his insight on the primary drivers in social media and text analytics for 2011, the biggest challenges enterprises are facing as they rollout integrated social business processes and the future of metrics.
How is Social Media challenging the way businesses operate today?
This week as part of our executive series, I talked with CEO and one of the original founders of Collective Intellect, Don Springer. He provided his insight on the primary drivers in social media and text analytics for 2011, the biggest challenges enterprises are facing as they rollout integrated social business processes and the future of metrics.
How is Social Media challenging the way businesses operate today?
Well, let’s take a look at some figures. Industry research estimates that 127 million people, or 57.5% of Internet users, visited a social networking site at least once a month in 2010. The steady rise since 2009 is attributed to the ever-increasing popularity of Facebook. Not only is the number of users growing quickly, but also the audience demographics continue to widen. In 2010, it is estimated that 59.2% of adult Internet users will visit social networks monthly, up from 52.4% in 2009.
And as individuals adopt and begin using social media to exchange recommendations, referrals and opinions – all of these conversations translate into an enormous volume of data. The growth of unstructured data is expected to grow with estimates pegging the compound annual growth rate at 62% from 2008-2012.
What this means from a business or market perspective is a seismic shift from one-to-many marketing to the considerably more-complex social media engagement. This represents a changing of the guard from traditional marketing techniques to a personal, identifiable marketing effort. Social media giants, like Facebook, LinkedIn and Twitter provide the platform for the conversation, or word-of-mouth recommendation, which ultimately influences purchase behavior. The interactive and multi-directional nature of these social channels has given customers ownership of the conversation, which companies are increasingly recognizing.
Yet for many businesses, they are completely unaware these social conversations about their brand, products or industry are going on. All of these insights and user-generated content are simply not analyzed or reviewed to help inform business process or outreach programs. Social media analysis is real-time, publicly available information that can be categorized and filtered and is the type of data that really lends itself to open-ended white spaces analysis. Organizations can use a sophisticated listening platform to find out what is truly important to consumers; insights that are so unexpected or surprising, an organization may not have even known or realized these types of brand association or product uses were going on.
So, how can companies get started monitoring and using social media data?
We’ve put together a social media maturity curve both to help companies identify where they are in the adoption and integration of social media analytics but also as a guide for becoming a social business.
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It somewhat depends on the industry or business function but for the organization as a whole the act of “Listening” to social media conversations, to begin to collect basic insights around brand and product awareness is critical to remain relevant and competitive. But to use an example, let’s take a look at a market research company. They may begin to use social media insights to validate findings from traditional research. More interestingly though is when they apply our semantic analytics engine to data and begin to dispel misconceptions, or surface unexpected insights. Once a company begins to approach social media analytics or text mining in strategic manner, they can begin to define how and what social media analytics they want to gather, then this type of analysis can be set up in a repeatable and consistent fashion. This data stream can be fed into a database and used to populate dashboards or other business process workflow systems.
And really that’s where the true power of social media can be realized, when companies begin to take an integrated, 360-degree view of their customers. Because it’s not only listening to and engaging in social conversations that creates or defines the value of the relationship, it’s capturing those exchanges and marrying it to other data points so that companies are reaching out to customers at the right time, where they are and with the appropriate message.
Where are most of CI’s clients on the maturity curve?
They are in step 3, Social Research, using blended qualitative and quantitative reports to inform strategy, and then converting insights from those reports into real-time, always on dashboards. This is the first phase of really unleashing the power of social analytics mentioned above – getting data flowing to make informed decisions around marketing, sales, and customer services tactics to course correct activity and change ROI.
Our more savvy customers are building on this to enter into Social Targeting, Social CRM and Social BPM with a variety of initiatives this year. Companies are no longer just performing ad-hoc listening. The enterprise is moving towards the need to have repeatable, scalable and consistent social media analytics fed into a data stream and then manifested in a dashboard.
At this point in a company’s adoption and integration of social media analytics, we usually work with a governance committee comprising PR, brand managers, and customer service/relationship marketing interests. And the questions they are asking are how do we invest in an enterprise listening platform that becomes the data driver to integrate into our other systems? How do we append data in a CRM database or transactional repository, where each conversation is defined as a transaction and fed into a business process management system?
We are seeing IT beginning to get involved. And they are looking at a variety of solutions; some are hosted in the cloud, others need integration at the data level; some install our software or use our solution for private data, like processing private confidential records. They want to install our software in their database and they want and need to keep control.
So, we are seeing this whole evolution at the enterprise level where it’s not longer a single group doing their own thing, with no managed workflow and where the customer engagement is only as good as the individual doing the engaging.
This is exactly where we think the industry and the adoption of both social media analytics and tools is going. Soon social media analytics will not be a stand-alone metric, data will flow everywhere and it will become a data management question. Companies effectively managing data to optimize social business collaboration will be able to develop and nurture the lifecycle value of their customers and their customer’s social network.
The benefits of social media analytics and increasingly integration are becoming more apparent. Why do some companies struggle to adopt social media?
Much of the integration difficulty can be attributed to the lack of management support and confidentiality concerns that seem to prevent full adoption of social media within the enterprise. According to a recent market research survey, 33% of the respondents stated they were not the decision-makers and 14.7% stated “management resistance” was an obstacle to social media adoption. To add to this, 33.1% pointed to “confidentially issues” as a reason for not adopting social media.
One key reason that management resists is that social media investment lacks transparency, with less than 15% of companies that use social media measuring return on investment and over 33% not measuring return on investment at all. It seems that many companies struggle with identifying what to measure, how to measure and how to interpret the data when they are able to gather results. This lack of transparency and measurable success ultimately leads to decreased confidence about a company’s social media strategy. As the ROI discussion evolves and more companies are actively pursuing a social media strategy, the need for measuring and analytics will become more prevalent.
The Future of Metrics is Outcomes
Companies are not only looking at brand awareness metrics and sentiment but at consumer conversations at the category level, which can be used for benchmarking and competitive comparisons. This type of metric is much more sophisticated than sentiment analysis because it’s about outcomes – “are we fixing the problem for our customer”.
For example, call center volume is decreasing as individuals use social media tools to find answer themselves or ask their friends for help. They are canvassing people they trust and who are willingly sharing their knowledge and doing this sometimes while they are on hold with a customer service agent.
The answers a customer is searching for may not be coming directly from the company. Companies would prefer their solution, their answer was referenced either by an individual within a customer’s social network or via a direct engagement with the customer. The metrics worth tracking and that can be validated by social media analytics are “did we fix the problem”; “are our solutions referenced and amplified by the social network”; “if so by whom”; “if not, who is providing the support”. These are very different indicators than simply sentiment or activity volume.
Savvy organizations have BPM solutions/managed workflow in place to track and manage where the complaint initiated and where it ultimately was resolved regardless of platform. From a content perspective they are creating links to collateral – digital libraries – organized based on frequency and amplification measurements – so that they are promoting their brand’s perspective on the issues.