Social Media 2012 Etb Final

7/31/2019 Social Media 2012 Etb Final

1/29

1

2

Reminders

Complete the Futureview Experience by Tonight at 7pm

Period 5 decisions due Tomorrow by 9am

3

Period 6 decisions due by Sunday at 6pm

Final SABRE strategy paper due next Tuesday in class

Based on results through period 5.


2/29

Todays Outline

What we know about optimizing the use of social media as

an element of a firms marketing mix; What causes things to take off: the role of social influence

in consumer choice

4

Using this knowledge to predict product sales and diffusionover social networks

Important Topics on Social Media

[1] Why Should You Care?

5

Why is this an important topic?

Firms are placing big bets on it.

6


3/29

Fr iends and fami ly are the m ostt rust ed sources for dec is ion-making

7

Traditional Consumer Decision Model

8

9

Consumer DecisionModel with Social Effects


4/29

In the Social Media Driven World.

Consumer tastes are far more transient and harder to

forecast than one might hope Driven by social influences (I like what everyone else

likes)

10

Awareness is driven by social media, the course of whichfirms may have limited direct control over

The modern spin:SM as the great accelerator

11


[2] Dont confuse what you know with what you know


12


5/29


Does this kind of knowledge translate into a more effectiveuse of Social Media as a Strategic Marketing Tool?


13

WELL, IT DOESNT HURT BECAUSE IT REALLY IS A NEWMARKETING LANGUAGE

SOCIAL MEDIA

APPLICATION

BRAND

AWARENESS

BRAND

ENGAGEMENTWORD OF MOUTH

Blogs # of unique visits# of return visits

# of timesbookmarked

search ranking

# of members# of RSS feed

subscribers# of comments# of user-generated

content

average length of timeon site

# of references to blog inother media (online/offline)

# of reblogs# of times badge displayed on

other sites# of likes

The New Language

14

o responses o po s,contests, surveys

Microblogging(Twitter)

# of tweets aboutthe brand

valence of tweets(+/-)

# of followers

# of followers# of @replies

# of retweets

Co-Creation (Nike ID) # of vi si ts # of cr ea ti on at te mpt s # of ref er enc es to pro je ct inother media (online/offline)

Social Bookmarking(Delicious , Digg,

StumbleUpon)

# of tags # of followers # of additional taggers

15


6/29



[3] Why is Social Media Marketing just plain harder thanregular ole Marketing?


16

SABRE analogies

Imagine if 1k of investment in a new Social Media channelcould create 80% awareness AND shift ideal points towarda new product.but such shocks occur randomly

17

What makes the answer hard:

Unlike other media,

The depth and reach of messages is not under directcontrol of the firm; one can seed social media, but

spread relies on users

18

The message itselfis also not under full control; themessage that is seeded may not be the one that isspread among consumers.


7/29





19

a ma es ngs popuar n e soc a me a space, .e.go viral?

What Made this So Popular?

The Dollar Shave Club has raised $1 million in

"seed" funding from venture-capital firms

including Facebook investor Andreessen Horowitz

and Kleiner Perkins Caufield & Byers, which has

put money into companies such as Groupon Inc.

GRPN-3.43%

20

Consumer gripes about price are pushing Gillette to prove to customers

that they don't need to swap blades as often as imagined. In February, it

began running television ads saying its Fusion ProGlide blades only need

to be switched every five weeks.

Mr. Dubin said the proliferation of fancy blades has only confused men.

"Keeping it simple is the name of the game," he said. "This was an easy

premise for people to understand, and we don't want to complicate it."

OR THIS?

21

Evian


8/29

Maybe it is as simple as setting upa Twitter account and FacebookMarketing 622s

22

page and waiting for followers.Facebook Page

Possible Reasons

It has nothing to offer that I want or need

SABRE is not inherently cool

I dont see an bod I know han in out there

23

Content is relatively static

Walmarts Facebook Page has 10.57Million Followers. How do they do it?

24


9/29

Give Benefits. Lots of them. Example: Pampers Facebook page is the go-to site for

coupons.

25

Heinz Ketchup: go-to place forhard-to-get innovations

26

Be cool, or promise a network of

cool people/ideas

27


10/29

What Makes Content Viral?

Simple

Unexpected

Concrete

28

re e

Emotional

Stories





29

,i.e. go viral?

[5] Why does the popularity of some objects seeminconsistent with their true value?

* Bubbles

* Cascades

Ever wonder why consumers wouldwant to buy rocks?

30


11/29

Or why this kid is so popular?

31

Or why this kid STOPPED being popular?

32

What unites all of these examples?

Each is a case where value is difficult to assess withcertainty, and individuals differ in their privateassessments of value.

People draw inferences about value more from what

33

saying than their own private assessments.

The result: cases where aggregate demand is notnecessarily reflective of individual private assessmentsof value.


12/29

Classic Example of Cascades:

Product Evaluation

34

What makes this social influenceso powerful and prevalent?

35

It is rationaland information like this isincreasingly available!

As a related aside.Downstream business impact of cascades

Ever wonder why a restaurants reviews end with a fewnegative ones?

36

forums and blogs with positive postings?

Ever wonder why almost all company sites are moderated?Catch it before it tips!


13/29

But the explanation is incomplete

Examples: in the early 2000s LOTS of people were calling

housing a bubblebut firms (and people) kept investing.

37

And the data were there for all to see

38

To create bubbles two other factorsmust exist

Strong incentives to conform to the behavior of a otherswithin a network

39

information that would reveal fundamental quality, or distortthe interpretation of truth-revealing knowledge


14/29

Example :Cards in a Deck

40

Think of one of the cards from this deck.When you have it in your mind, be sure to

remember it, but do not tell me. I will thenshow you the deck again with your card

41

removed

Did I remove the right card?

42


15/29

The avoidance of knowledge

Once a set of beliefs are in place (e.g., that housing is agood investment), people are inclined to search for

43

beliefs

The Ostrich Effect: People are more likely to look to see how their

portfolios are doing when they hear there has been a positive change in

the stock market

44

Source: Karlsson, Loewenstein, and Seppi 2009

The Recipe for Bubbles and Cascades

Quality is imperfectlyobservable

An incentive to Conform

45

A cascade starts An incentive to avoid seekingdisconfirming k nowledge


16/29

[6] Can you predict Social Diffusion?


46

Starting point

The fact that demand for social goods may often bedecoupled from fundamental value does notmean thatdemand cannot be predicted or influenced.

All cascades require a favorable starting point (there

47

has to be somereal value).

The social diffusion process is far from random, and canpotentially be influenced given sufficient knowledge ofthe information networkbut it will require a new kind ofmodel!

Estimate a Model (the Bass Model) thatDescribes a Blending of the Two Processes

))(()( 11

1

t

ttt CSM

M

CSqCSMpS

48

S= sales

CS= cumulative sales

M= maximum cumulative sales

p= coefficient of innovation

q= coefficient of imitation


17/29

Bass Model Assumptions

Fixed Market Potential

Reality is adopters bring new people to the network.

Fixed Parameters (no changes over time)

49

Population that consists of innovators and imitatorswhere innovators drive the diffusion process

It is not that clear cut.

All past adopters are created equal

Not true, network adoption location

But the real world is more complexdiffusion arises over networks

50

Social Hubs and Diffusion

George is

centrall

51

located, but

not necessarily

an innovator or

an imitator.


18/29

Social Hubs and Diffusion

Ed is an

innovator

52

Who will

likely adopt

first?

Social Hubs speed the rate ofadoption

Ed may adopt

first, but George

53

s ar more e y

to be the one

who triggers

widespread

adoption

Example: Ford Fiesta Movement

Traditional media car introduction:

We would show the vehicle at an auto show a few monthsbefore it went life and we started production. At that point, we

would have a huge, massive media buya traditional media

54

uy a wou as - mon s an en wou en . yBecause we needed to build awareness very quickly beforethe vehicles arrived at the dealership. Then wed hope thatthe awareness field was high enough that it would last.

New media car introduction (2009): 100 people received cars totest drive for six months and shared their experiences online.


19/29

55

Ford Fiesta Movement Impact

6.5M YouTube views

56

50,000 requests for info in first 6 days car was on sale

10,000 cars sold in the first 6 days

One implication: adoption rates may not display s imple S-shapedcurves

57

Up-take is non-monotonic, as adoption arises in concentrated waves

over the network


20/29

Reminder -- Medicines Case:WOM Can Move S -> C -> Double C

SalesSales

58

Time Time

Time

Sales

An Alternative to AggregateDiffusion Models: ABMs

Agent based models mimic the aggregate behavior thatarises when individual elements (here people) modifytheir behavior to conform to other individuals in the

59

vicinity

While used widely in physics, increasingly used to modelbehavior in complex human systems

ABM Models in Practice: the simplecase of strong and weak ties

Each agent is assumed to be part of two networks---onedescribed by strong ties and one with weak ties.

60

Each period there is a chance that he or she will becomeinformed either through external forces (e.g., advertising)or chance encounters with people who are aware withinhis or her network


21/29

Formally,

)()( )1()1)(1(1)( tjtr swtp

w=probability of exposure from someone with weak ties

=probability of exposure by advertising

prob(t)=Probability of becoming aware at time t

61

Implication: the stronger the relative influence of sover w the less

homogeneous the adoption process will appear (i.e., display spatialclusters)

s=probability of exposure from someone with strong ties

r(t)=# of weak ties, j(t)=# of strong ties

)()( )1()1)(1(1)( tjtr swtp

w=probability of exposure from someone with weak ties

=probability of exposure by advertising

prob(t)=Probability of becoming aware at time t

Role of Social Networks

62

s=probability of exposure from someone with strong ties

r(t)=# of weak ties, j(t)=# of strong ties

How would social networks impact , w, s,

r(t), j(t)?

Another implication: one might be able topredict product success from the early spatial

atterns of ado tion

63


22/29

Heres How

Below are the spatial adoption patterns of 2 products

measured 1 month after their release.

Product A

64

Which is more likely to be successful?

=adopted

ro uc

Long-term product sales and month 1adoption concentration measures

0.25

0.3

0.35

0.4

Supermarket Products Home Furniture

Sets

65

0

0.05

0.1

0.15

0.2

Success Failure Success Failure

Garber, Goldenberg, Libai, and Muller,Marketing Science, 2004


[7] Can firms make money over Social Networks?


66


23/29

Monetization of Social Networks

Play Games with your FriendsGet Targeted Recommendations

From your Network

67

et oca ecommen at ons

Will this company ever make any money?

68

Pinterest on Wikipedia

In December 2011, the site became one of the top 10 largest social network services,

according to Hitwise data, with 11 million total visits per week. [11] The next month, it

drove more referral traffic to retailers than LinkedIn, YouTube, and Google+.

In January 2012 comScore reported the site had 11.7 million unique users, making it[15]

69

.

Pinterest's wide reach helped it achieve an average of 11 million visits each week in

December 2011. Most of the site's users are female, with 97% of the site's Facebook

"likes"being made by women.


24/29

Is Too MuchCustomization/Monetization Possible?

70

+74% +54%

Salient P op-up bann er ad Imbedded ad matched to contex t

71

+48%

Pop-up ad matched to context

Value of Ad Type

compared to baseline

sales



[8] And it only is happening for digital firms, right?


72


25/29

Social Media - Retail

.

BENTONVILLE, Ark. April 18th 2011

Wal-Mart signs agreement to acquire Kosmix,

developers of a social media technology platform

Filters & organizes content to connect real-time

information.

73

Integrates shopping experience between bricks-and-

mortar & e-commerce businesses in nine countries.

Newly formed @WalmartLabs, creating technologies

and businesses around social & mobile commerce to

support global multi-channel strategy.

Consumers Voting for Product Assortment

74

Social Media - Retail

Innovation: internal & external initiatives

Twelpforce Ideax - shoppers suggest ideas other shoppers vote up/down

Sho erex e rience :M Sears.com and M Kmart.com

75

. . Launched in March 2009, over 400,000 registered users.

64% online buyers find user reviews important when purchasing. 47% online users - consumers trust consumers > marketers.


26/29

Social Media - Food

Competitive Promotions: has a new social media marketing campaign where any time 2 people individuallyuse the phrase mac & cheese in a tweet, each receives a link pointing out Mac & Jinx. The first one to click

the link and give Kraft their address receives 5 free boxes of Krafts mac and cheese and a T-shirt.

New Product Launch Promotions: Heinz Ketchup UK opens up a pop-up tryvertisingF-store on Facebook

(tryvertising = advertising by sampling .designed to create word of mouth, pop-up = temporary), making an

initial 3,000 bottles of its latest tomato ketchup (with Balsamic Vinegar) exclusively available to serious ketchupfans only before the new product was launched in traditional stores.

76

Drive traffic to retailers: Offer Groupon subscribers a first-of-a-kind home delivery grocery Sample Packfeaturing $40 worth of General Mills products including coupon book, breakfast, lunch and dinner fare for

$20. General Mills hoping deal will turn Groupon samplers into grocery-store name brand buyers.

Community Culinary Experiences: Blogger-hosted virtual cooking school called Cooking Connections-an 8-

week series of live blogging classes and conversations that take place on TheMotherhood.com and are cross-

posted live on Twitter and Facebook. Participants are encouraged to share their culinary experience via Twitter,Flickr and Facebook in an effort to connect others to the Cooking Connections community and experience.

Social Media - Food

.

April 21st 2011 General Mills

First deal offer on Groupon.

Posted on Internet at midnight in the Twin Cities,

sold out at 10:42 a.m.

-

77

-

We are not looking to make money on this.

Rather, by mailing out samples, the company is

trying to direct more traffic to grocery retailers for

its products - Karl Schmidt, company's director of

promotional marketing.

Social Media - Personal Care

Tailored Segmentation: multiple Facebook pages geared to unique audiences, consumer products a nd

conditions. corporate blog at JNJBTW.com .presence on YouTube (527 Videos) and Twitter.

Consumer Intimacy: 28 brands on its Facebook Store that enable them to: reward a nd build loyalty,

learn about brand usage & habits, stimulate WOM and sell products. Last year P&G launched a social

media initiative for Prilosec to maintain its leadership. Also P&G ended its 77 years of advertising on

soap operas in favor of social media.

78

Community intimacy: social media campaign for Kotex created a safe place for women and girls to go

to talk about personal subject. In less than 6 months it has reached an 8.3% market share in a mature

market. At heart of the Kotex Campaign is Listening and real conversation. The big idea was to take a

taboo subject a nd offer support and a safe place where women and girls could help each other withadvice and support.

Emerging Markets: success with social media marketing of Axe and to generate interest in the Indianmarket, created a Facebook page. Allowing users to interact with Axe Angels, male oriented marketing

designed to get men clicking back for more. In January 2011, 10 months after the page went live, 1+

million Facebook users had liked this page, and numbers growing since, now with over 1,247,800

likes.


27/29



[8] And it only is happening for digital firms, right?

[9] Social Media: Just US-Centric?


79

Social Media According to Renren

80

Donna Li from Renren

81


28/29

I n teg ra t i ng s ocia l med ia andt rad i t i ona l adv er t i s ing

Build a brand page on a major social media platform

Traditional advertising should drive users to your brandpage

Vehicle for brand stories, promotions, etc.

82

Encourage regular participation and interaction on page

Users to become brand advocates

Rele v a n ce f o r n e w a n d m a t u re p ro d u c t s

Appropriate for both

Mature Brand awareness and product experiencesalready establishedEasier to leverage WOM power

83

New Social media platform must be largeMaximize awareness through reach andfrequency (Go where the consumers are!)

The Future of Social Media3 5 year horizon

Not a trend, but a part of our lives

Companies should integrate social media with overallstrategy it is not confined to PR or marketing

84

Support marketing team with social media expertise andresources

Encourage social media innovation and allow mistakes

Mobile is the next big thing. Start thinking now.


29/29

Doesnt Sound Too Different than

85

,

Conclusions

Social influences can be a major driver of consumerdemand---but care must be taken before assuming thathigh current demand implies an enduring preference worthinvesting in (bubbles are everywhere)

86

Emerging trends canbe spottedand new families ofdiffusion models are emerging as tools

Social media investments will be a central part ofmarketing measurement and selling tactics goingforwardbut we are just beginning to learn its capabilitiesand limits

Next time: the marketing of products toconsumers who have yet to be born

87

Social Media 2012 Etb Final

Documents