What's It Worth To Be A Social Object?
Ed. note: This is part of a series of excerpts from The Social Customer, the new guide to social customer acquisition, monetization, and retention by Adam Metz. For the first entry, go here.
This installment continues Chapter 1: The Brand As A Social Object and the Business Case for Social CRM. Adam asks what a brand as a social object is worth.
What trips up consumer brands in terms of becoming “social objects” is that brands are sold on the value of knowing consumer sentiment and being able to act on it: “Do consumers like and trust our company, the Gap? Are they still open to the idea of buying things from the Gap after learning that we had to terminate business with 23 factories because they were using child labor?” They’re not yet sold on the value of letting consumers interact with them. For example, as of late 2010 Southwest Airlines had a little over a million people interacting with (“following”) their brand on the microblog platform Twitter, but the actual “hard value” of that marketing asset is unclear.
To calculate the financial value of a piece of social collateral like this Twitter account, I propose that brands use what is called “Crisis Valuation”: How much would the brand be willing to pay, in a crisis, to have this asset. You may recall the Menu Foods 2007 Melamine tainting scandal in which certain pet food made by the company were sickening and killing household cats and dogs. In such a crisis, the company would have wanted to directly communicate with a few million customers and prospective customers before or just as news of the issue hit major news sites. While it may be possible for a brand to make fast, sweeping changes to a branded destination Web site (i.e., changing Menufoods.com on a moment’s notice to reflect news of the incident), or plan an impromptu press conference, it might be more valuable to the brand, a better crisis response, and simply more calming to consumers to first respond through two-way social channels.
Sometimes, becoming a social object is actually the cheapest, easiest option. How much is this social asset worth to Menu Foods? Ask their PR department what they’d be willing to pay to communicate directly with a quarter-million customers within a few minutes of the first sick pet. I’d be willing to guess that the answer is about a million dollars, maybe a little more. In a crisis event, I’d envision a brand communicating with customers roughly every 15 to 30 minutes for the first 48 hours; the location-based expectations, for the social customer, sometimes differ.
“With real-time social media like Twitter, the user expects realtime feedback, which is not always possible,” according to Dave Andrews, founder of Devious Media. “With a stand-alone community based on the company’s brand [a branded community], they are more accepting to turnaround times within 24 hours.”
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