How Social Media Boutiques are Winning Deals Over Traditional Digital Agencies

 

Social Media Agency Budgets: Boutiques versus Traditional Digital Agencies

 

Some insightful research from a research report by Altimeter Group, reported on Web Strategy by Jeremiah Owyang shows a pretty dramatic trend going on in the agency business right now. It appears boutique social media and content agencies are really taking some significant chunks of client’s business away from traditional digital shops. This is really no different than the general trend in the agency business as a whole, where clients shift entire budgets away from established agency players to smaller, more specialized practices.

At some point, the big shops become too lethargic and cumbersome to meet the increasingly specialized demands of clients in emerging communications channels and practices. Their staffs a bloated with overhead and people that provide the things clients don’t want to buy anymore. They are machines of marketing service. The big guys aren’t really market makers, after all, they’re market takers.

But, the problem is, success in the marketing services industry is shifting dramatically away from how well you are at being a bulk provider big, media-centric ideas and is now more about delivering innovative and compelling experiences that transcend communications channels. Marketing services is not so much a practice that starts with the client brief anymore…rather it starts by listening and observing your customers online behavior and interests, mining this for insights then creating your ideas and content based on what your audience tells you they’re already interested in. Marketing is now less about what you have to say and more about the user experience. And, it is a new breed of social boutique agencies that is winning over significant chunks of client business, away from more traditional digital agencies.

Altimeter identified why the smaller, more nimble firms are winning:

  • They put business goals first, tools and technologies second
  • They offer a specialized skill set in new media and social business traditional shops most likely don’t
  • They offer change management within  the corporations. Traditional agencies layer social on top of existing campaigns
  • They have a long-term or community-building vision versus a short-term,campaign-focused mentality
  • They roll up their sleeves to assist with deeper customer engagement instead of relying on traditional advertising (a top spend item in social programs)
  • Smaller, more agile teams with senior leadership that can respond and adapt to changes in the technology space
  • Fundamentally are geared to measure differently around engagement and what that means…not just to line and bottom line measures.

 

 

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10 Trends in Mobile Technology

Mobile Gaming

From the Wall Street Journal the top trends in mobile for the coming year. Here they are:

  1. Tablets will take over the world
  2. Android will take over the world
  3. Apps will take over the world
  4. 4G will take over the world…eventually
  5. Parts for mobile handsets and networks will be in short supply
  6. The attorneys will have a field day protecting turf via patent warfare
  7. Security and privacy will be insecure and not so private
  8. China will screw everyone
  9. Your phone replaces your wallet/purse
  10. Location, location, location…as in using your phone to broadcast yours to everyone and allowing marketers can know your location so they can bombard you with coupons, offers and other Minority Report-like advertising assaults.

Mobile Virtual Goods Generate 4X More Revenue Than Ads

There’s gold in them ‘thar hills of virtual stuff. According to data from analytics firm Flurry, mobile virtual goods are hot. So hot, in fact, they’re far surpassing the revenue generated from mobile advertising.

The study, conducted using data collected from leading iOS social networking and social gaming apps, shows that in September of ’09, out of close to every $2 of mobile revenue… either advertising or virtual goods…over 2/3rds went to advertising. Just one year later, not only has the amount of revenue grown significantly, the amount going to virtual goods…swords, gold coins, respect points or plum trees for farm plots…has shifted dramatically to where virtual goods now account for $8 of every $9 in revenue. And, because Google’s Android Market does not yet support in-app purchases or micro-transactions, the data doesn’t include users from this rapidly expanding platform.

Virtual goods sales were already going gang busters on social sites like Facebook. Michael Pachter, Wedbush Morgan Securities video game analyst, reports that social gaming revenue has grown from approximately $600 million in 2008 to $1 billion in 2009. Further, he forecasts that social gaming will generate nearly $1.6 billion this year, and grow to more than $4 billion by 2013. That’s a lot of quarters for plum trees on your Farmville farm.

The convergence of social and games will continue to expand their reach into our lives. In fact, social gaming is reaching a tipping point and with Wal-Mart and Verizon now selling iPads, the size of social gaming’s audience will quickly surpass prime time television viewership.

For marketers, this sweeping technology, entertainment and behavioral change represents tremendous opportunity to create highly engaging content built around the core premise of your brand, then invite consumers into a branded experience that extends far beyond your physical product or service. In fact, maybe it’s time to start thinking beyond the five “P’s” when it comes to marketing. Maybe it’s time to add a “V”. Seems plausible doesn’t it…the brand manager of the new realities has to think about Product, Price, Place, Promotion and Virtual. Can you imagine what a virtual version of your brand or brand experience would be, could be? If not, you should start dreaming. There’s money to be made for the imaginative mind.

Top 5 Emerging Brand Trends on Facebook

This was an excellent and comprehensive Mashable overview of the five major trends brands are using to connect, transact and serve customers on Facebook. There’s some very impressive innovation going on in the space, lead by some very big brands like Ford and Nike. What have you seen brands doing on Facebook that impresses you?

Social Influence Markering Trends


Excellent presentation on Social Influence Marketing by former RazorFish digital strategist and author of Social Media Marketing for Dummies, Shiv Singh. What’s social influence marketing, you ask? It’s the reason you get your company into social media in the first place…to have influence.

Gillette Venus Spa Breeze Razors Packaging: Far from a Breeze to Open

Social Media Brand Monitoring Experiment #2:
Okay, I know theft is a big problem for retailers (the industry term is “shrinkage”) but I’ve got to tell you Gillette, a Procter & Gamble brand, has stooped to very consumer-unfriendly means to prevent it.

My wife just returned from a trip to Sam’s with these razors and when trying to open the club pack package, it was so difficult to open she ended up flailing away at it like a crazy person. I interceded to stop the stabbing madness she was engaged in and I found the dang thing dang near impossible to open. An indication of my frustration is the use of “dang” twice in the same sentence!

Maybe it’s just me but I think we’ve gone too far when the products we buy can’t even be opened because the manufacturers have made them so “secure”. The imagery and messaging on the web site for the brand is a big disconnect from the brand experience we just had…nearly stabbing ourselves to death trying to get nice smooth legs. “Love it?” the site asks as it shows a beautiful model with silky smooth legs. Ah, hell no Gillette. I most certainly DO NOT love your packaging. Have you ever tried to open that package without a small thermo-nuclear device?

What they should show is a model with bleeding stumps for hands, writhing in agony as her fingers lay before her on the floor, all of which occurred because she failed in her attempt to open the package from hell!

There has to be a better way to keep Sam’s Club members and employees from walking off with your razors but still allow those of us who actually pay for the damn things to come away from our packaging opening experience with all of our digits.

Are you listening Gillette?

Apple Face Time Commerical: Perfect


Apple once again demonstrates what an intelligent and intuitive marketer they are, not just in terms of product development but in advertising…yes, advertising. This is a beautiful spot for Face Time on iPhone 4.

In this almost two-minute video, they show you BENEFITS of a feature. And, they make it seem like Apple just invented video chat, which has been around for years. But, in a way, they have invented it because video chat has never been so mobile.

What’s a benefit, you ask? You know, those reasons people actually buy something in the first place, not to be confused with features, which marketers take as the reasons people buy. Do people want a better camera or do they want to take better photos? Do people want a better smartphone or better, more intimate communication?

Other manufacturers in the consumer electronics category would have laden this ad with features, FEATURES and MORE F-E-A-T-U-R-E-S plus a ton of legal disclaimers taking up the last third of the spot. Reminds me of the brilliant and hilarious YouTube video entitled, “If Microsoft Designed the iPod packaging”.

Apple gets humans. They know we like beauty. They know sometimes dads travel for business and at the end of the day, sitting in some lonely hotel room, want to be reminded of why they go through all this in the first place and want to connect with their family. They know sometimes grandparents can’t be there for the graduation but want to experience it anyway. I got chills when the military dad watches the ultrasound of his unborn baby, while it’s happening. Do you notice the tear in his eye? I have to admit, I got one in mine.

This is a beautifully shot piece. It taps right into your emotions without a word. Apple gets humans. They know we communicate a lot with just our expressions and gestures. You can feel the reverence for the human experience. Maybe I’m too much of a fan of Apple but I don’t think so. I just admire the way they respect me, they anticipate me and understand that what I’m looking for is not a better widget but a better experience with other humans. How nice.


via Apple Face Time Commerical: Perfect.

Social Media Produces Love-like Affects in Our Brains


Two fascinating posts in one day! This from Fast Company which looks at the powerful affects social media is having on our brains. Neuroscience is finding these digital, social connection release chemicals in our brains similar to what occurs when we fall in love. Now this is powerful stuff for brands that can find a way to enter into social media properly. Building relationships is not just a marketing buzz word. It’s actually occurring and brands should take this into consideration as they craft their social strategies.

Top 9 Brands on Facebook and Twitter

Another superb post from Brian Solis on comScores Q1 U.S. E-Commerce Spending Report. Brian’s post is filled with a ton of great information and insight and he includes this graphic, showing the top 9 brands by “like” on Facebook and followers on Twitter.

What I find fascinating is the mixture of brands in this list…a classic CPG titan like Coca-Cola, up-and-comer Red Bull, retailers Victoria’s Secret and ZARA, digital brand YouTube…even Converse. Some achieve their ranking based on their Facebook presence alone. And although Twitter hasn’t had as much time as Facebook to build as a service, it’s having an powerful impact as a source of news and information, even for brands.

This mixed bag of participants just goes to prove that success in the social space doesn’t depend so much on category but on actual participation. Having a presence in social media is one thing. Using it as yet another channel for old and tired “push” marketing and advertising is another. Brands that insist on this latter approach, and there are a lot, just prove to everyone they don’t get it.

What matters? Listening, engaging in the conversation naturally, offering value first before you try to “pitch”…these are the currencies of brand participation in social media. Gee, sounds a lot like what one person does to have a mutually beneficial relationship with another. Maybe if brands acted more like people and treated their customers like people instead of objects (“targets”) they’d experience better results all around. Something to think about.

Does Social Media Engagement Translate to Brand Sales? Yes!


Excellent post by social media thought leader Brian Solis on how social media engagement on sites like Facebook and Twitter is translating into sales for brands. New research reveals that over 60% of Facebook users and a whopping 79% of Twitter users are more likely to recommend a brand since becoming a fan/follower on these social networks.

Solis goes on to point out that actively and thoughtfully engaging consumers in social networks is fast becoming a base expectation. But, brands beware! Reread the first part of the lead sentence in this paragraph again…the part about actively and THOUGHTFULLY engaging.

It never fails to amaze me when I find big brands using social media channels as yet another avenue for interruption or push messaging. You see this all the time. Some brands think it’s still all about them. This is the quickest path to irrelevance and having consumers dismiss you as hopelessly out of touch. This channel is NOT about what you have to say. It’s about LISTENING and joining in the CONVERSATION and one of the best ways to do this is with relevant content.

Brands have a tremendous opportunity to use social media as a platform to develop and employ a new set of relationship skills and a distribution vehicle to serve up content that seeks to first provide a value to their audiences. This skill set doesn’t come naturally to brand marketers who have spent years of their careers and millions of dollars perfecting their ability to TALK AT people through ads, direct mail, press releases and the like, delivered via traditional media channels. This is a comfortable and easy-to-manage process, for sure. Unfortunately, it’s a marketing method sharply in decline and no wonder: There’s very little consumer value delivered in this legacy advertising/pr, interruption-based approach.

The mantra of the internet in the first part of this decade was: if you’re not on Google, you don’t exist.

The mantra going forward is: if you’re not on Facebook or Twitter, you don’t exist.

This isn’t just the opinion of young people, according to the research Solis references.

“It shows they are not really with it or in tune with the new ways to communicate with customers.” Female 18-24.

“If they’re not on Facebook or Twitter, then they aren’t in touch with the…people.” Female 55-59

I know this to be the case from my own experience. I own two Lexus cars. I love them. But, there’s one problem…their keys suck! They have some kind of manufacturing defect in the plastic of the key fob and they become very brittle and break over the course of normal use. Now, aside from the fact that a cheap, crappy key is a big disconnect with a luxury brand experience, there are two other major irritations that go with this problem:

1) When the key fobs break, the transponder often falls out. Without the transponder, you can’t open the doors remotely and in certain cases may not even be able to start the car.

2) Replacement keys cost a ridiculous $200 a piece.

Least you think I’m petty and needlessly using the blog to harp on a personal matter…this has happened to three of our four main keys. Do you think Lexus covers this under warranty? Ah, no.

The last straw came a couple weeks ago when the third key broke as my wife was engaging in the extremely abusive behavior of removing it from her purse. I decided to see if Lexus was even listening on social media so I tweeted about the issue and got no response. So, I then posted it on Facebook…where I also got no response. In a Twitter search, I found lots of posts from Lexus about their new sexy new sports car…along with my tweet gripping about the key. In a Google search, I also found lots of links to people complaining about Lexus key fobs breaking. Either Lexus is not listening or they don’t care. And, you know what…I’m not so sure I care that much about $50,000 cars with cheap, crappy keys. After all, a $50,000 that won’t start because of it’s crappy key is the definition of useless. And infuriating.

This is obviously a customer service issue and social media is a great, real time lab for listening to customer complaints and issues and fixing them. Just look at what Comcast has done using Twitter to improve it’s customer service experience. If nothing else, responding to complaints on social networks gives brands the opportunity to not only solve problems but let everyone know they’re doing so. In the process, they can turn the complaints into compliments. This clearly reflects positively on the brand and everyone can know about it…something that doesn’t happen in a call center interaction.

But, to be relevant on Facebook and Twitter, brands need to go beyond using it to resolve customers service issue. A brand needs more than a social media presence. Brands should be surprising and delighting potential customers and customers with content that seeks to answer their questions and need for information first…and you can gently and organically integrate your brand into this content when and where it’s credible and makes sense. By taking this approach, a brand earns the right to be heard.

We call this approach Branded Conversations…listening first, then providing relevant content that answers customers questions and need for information. We think it’s a new marketing practice whose time has come.