Brands face a difficult choice. Social Networking is exploding worldwide. Brands can ignore them.
Brands can integrate with them (Toyota Scion and Second Life, Vodafone and MySpace, Microsoft and Facebook, Warner Music and YouTube, CapGemini and Facebook).
Brands can buy them -
(NewsCorp-MySpace, Google-YouTube, Cisco-FiveAcross).
Brands can build their own (Proctor & Gamble-Capessa, Toyota Hybrid Social Network, Barack Obama Presidential Candidate 2008).
Brands can choose some of the above, all of the above or none of the above but whichever they decide the decision is a tough one wrought with pain and the subsequent implementation options likely to involve Boardroom concern.
My name is Thomas Power and I’ve been building (www.ecademy.com), studying and analysing social networks and social media for 10 years. I find the subject fascinating and much more than a passing fad. I like talking to people about social networking, I like listening to people’s view on social networking and I like addressing audiences on social networking. I’ve met 9,000 Ecademy members face to face in 43 countries. I’ve done my homework.
Social Networking is about managing a dialogue with your chosen audience be they consumers, suppliers, shareholders, public institutions, media, fans or business people.
In many ways social networking is an advanced form of Direct Marketing and Customer Relationship Management (CRM) from the 1970s, 80s and 90s.
There is however a big difference because in the past the brand was in control now the tables have turned and your audience is in control. This is scary. They are scary.
Buzzwords like User Generated Content (UGC) and Web 2.0 are not helpful because they do not explain what is really happening and few people know what these phrases mean let alone how to act upon them.
When an audience is in control they can criticise your brand, they can criticise your products, they can criticise your management style, they can criticise your directors and worse they can criticise your share price. They can make your share price go up as well as down. They can hurt you and they do if you deserve it.
I think for publicly listed companies like NewsCorp, Google and Cisco the decision to buy social networks has not been taken lightly.
It does not take a brain surgeon to realise that NewsCorp, Google and Cisco are capable of extending these social networks into mobile phones, credit cards, banking and insurance services. Afterall we have seen this done before with ebay acquiring PayPal (banking payment services) and Skype (telephone services). Do you know the plans of these three organisations? Do you think you should know or at least have a sense of what they are up to? Do you even care?
So what does this all mean for you?
You have to decide what path you wish to take, a slow gentle partnership entrance to the market or a bold strong fast entrance to the market.
Whatever you decide you have to capture and communicate with your chosen audience sooner rather than later. If you don’t, someone else will and they will charge you a king’s ransom to access your audience.
We are in the early stages of brands becoming media companies in their own right and many will choose to stick to their core competence which I consider a risky strategy.
I have never been a fan of core competence thinking. Is Google really just a search engine? Was Microsoft just a software company? Did IBM just make adding machines? Did Virgin just sell records?
So what are the brand benefits of social networking?
Product testing and market research has to be one of the biggest benefits.
Having a direct dialogue and conversation with your consumers in real time 24 hours a day, 7 days a week is another positive benefit.
Yet another benefit is speed and the ability to launch new products within hours rather than months with instant feedback on successes and of course flaws.
Personally I like the benefit of meeting my consumers face to face on a regular basis – Ecademy members organise 400 events a month across the globe. We didn’t realise they would do this themselves. It was not in our business planning.
Consumers teach you things inside social networks. They tell you what they want and how they want it. They tell you about pricing, about product changes and enhancements, about things you have right and things you have wrong.
They do things you are not expecting. They do things you cannot yet imagine. Inside social networks your consumers are alive and kicking, talking to one another, sharing thoughts, supporting one another and expressing themselves.
Brands in many ways are about self expression and choice be that through clothing, be that through cars, be that through hotels, airlines or restaurants.
The internet is a vehicle for consumers to totally engage with brands effectively turning brands “inside out” to form an “outside in” environment. This is a big change for brands, a change that’s likely to transition over 10 years.
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