The essence of social commerce is nothing new.
For all of human history, our purchase decisions have been influenced by our friends, family and the zeitgeist of crowds. Harnessing social influences is the Holy Grail of marketing. It is the defining trait of all great brands: They become social movements. To harness the value of a crowd, you must start by gaining the enthusiasm of a single person – then scale it as quickly as possible. This poses three vexing problems for marketers:
- Who are the influential people that will be the evangelists that motivate crowds to buy my brand?
- How to I position my brand to attract and maintain good customer relationships?
- How do I get customers to engage with my brand so that I build lasting and valuable relationships?
Social commerce offers the right answers:
- Find influential people at the center of social networks that share common interests and values.
- Attract people with content that is relevant to their interests and values.
- Engage with social media (Facebook, LinkedIn, Twitter, blogs, YouTube, etc.)
Measuring personal influence is the single most important step: Find the right brand evangelists and they will do the selling for you — growing your business without the costs of advertising and promotions. Piss off the wrong person and your brand will suffer. Badly.
Klout’s answer: Focus on people that have the greatest online influence.
Klout evaluates online reputation by evaluating the impact of your Tweets, Facebook postings and other online interactions to get others to act. Your score is proportional to the number of clicks you generate online. The theory is routed in social network analysis (SNA): A high Klout number indicates that a person can influence behavior and preferences among people in their personal network.
The most amazing thing about Klout is that it is the first wide-spread measure for person’s value to social commerce. Its simplicity is genius… if it is accurate. And I think not…
Most brands fail because they forget a simple truth: The vast majority of people don’t give a damn about you or message.
Most brands are irrelevant.
We live in a world filled with marketing messages that land on deaf ears. Most advertising fails. Coors wastes millions on advertising that is shown to children (who can’t legally buy beer). Pfizer bombards me with commercials for drugs that treat diseases that I don’t have. ATT hires movie stars to convince me that they provide great coverage yet everyone I personally know with an iPhone hates ATT’s wireless service.
And yet, the spending escalates as we all grow deaf…
Social commerce is the new gold rush of marketing: Promising that it can turn any brand into a social movement. You only need to engage customers – provide them with a way to interact with your brand. Most marketers interpret this to mean they need to be friends with all 500 million people on Facebook and all 200 million people on Twitter. Again, they miss the point: Relevance.
Relevance is king. Long live relevance!
Dave Carroll’s United Breaks Guitars is a great case study on how a big corporation with so-called sophisticated marketing miserably failed to understand the importance of relevance. For those of us that fly a lot, we all know that United sucks. Small seats. Employees who ignore customers. Lost luggage, etc. Thanks to Dave, we now know that United also breaks $3500 guitars – then denies any responsibility. Ignoring Dave’s repeated requests to fix his guitar was a $180 million mistake for United. More than 9.4 million people watched his video as thousands of mainstream media outlets joined the blogosphere’s rage against the airline’s insensitivity and arrogance. Dave’s message was relevant: We’ve all had bad experiences with United.
Klout Can’t Help United
What would have happened if United paid attention to Dave’s Klout score? Nothing different. As of today, Dave has a Klout score of 39 – the same as mine. We are in the top 30% of all Klout scores – hardly worth of mentioning since there are tens of millions of people with higher scores who fly on United. My guess is that Dave’s score would have been far lower at the time of the incident. In short, Dave was (and still is) not a crowd mover according to Klout. However, he is a crowd mover as measured by personal influence. Just ask United’s shareholders.
The Value of Personal Influence is Measured by Relevance
United failed to see Dave as an individual who mattered. He had a problem that was relevant to millions of their customers (and potential customers). Initially, United did not even see Dave. They ignored him. Then they saw him as a loss mitigation problem and denied responsibility. Next he became a public relations problem. Then a problem affecting stock price. And now, he is a case study at Harvard Business School on how to manage customer problems.
Can you afford to be inauthentic, irrelevant and lack authority?
The problem was never Dave. It was United. They did not align their business processes to the relevant needs of their customers. They gave lip service rather than real service. They said they were sorry then did nothing – providing proof they lacked authenticity. Finally, they lacked the authority in the market to counter act the wave of negative press generated by Dave. And I’d bet that no one at United lost their job over this incident.
Influence is personal… not electronic.
We all know people who refuse to participate on Facebook. And we know even more people who think Twitter is a noise generator and a fantastic waste of time. Yet many of these social media naysayers have tremendous personal influence. My doctor has no Twitter account yet I follow his advice to follow The China Study while ignoring Pfizer’s commercials. My best friend (in real life) warns me about ATT service so I buy an Android phone that works with Verizon. New Belgium Brewing sponsors my favorite charity events so I’m willing to experiment with buying new beers they bring to market. None of these purchase decisions were driven by online behavior. Yet, all of these decisions were driven by social commerce. And all of them have two three things in common:
- Relevance – The brands relate to my personal values and interests.
- Authenticity – The brands do what they promise to do.
- Authority – The brands are endorsed by people I trust.