Social Media: Why your business can't afford to ignore it

Strategy Talks

Podcast Series

Social Media:
Why your business can't
afford to ignore it

Vanessa Iarocci
Debbie Dimoff

Episode 45: Social Media: Why your business can't afford to ignore it

Release date: September 9, 2011
Host: Vanessa Iarocci
Guest: Debbie Dimoff
Running time: 19:20 minutes

We have all heard the popular saying, "the medium is the message." Never was this more true than in the case of social media. This podcast is an interview with PwC's Debbie Dimoff, who discusses why social media tools and practices are becoming increasingly crucial for business interactions with customers, and for monitoring the wider business landscape around you.

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Episode 45 transcript:

Announcer: Welcome to Strategy Talks, the business podcast series by PricewaterhouseCoopers Canada. Hosted by Helen Mallovy Hicks, National Leader of PwC’s Valuations, Forensics & Disputes Practice, and Calum Semple, an Operations and Consulting Partner. This interview series, featuring new topics and guests every episode, is designed to valuable insight into some of today’s hottest issues affecting your business.

In 1964 Marshall Mcluhan stated: “The medium is the message.” Although he could not have anticipated this at the time never was his statement more true than it is today with social media. I am Vanessa Iarocci your guest host of strategy talks.

Today we will be exploring Social Media and why it is important for your business. Joining me is Debbie Dimoff: A Vice President in the Consulting & Deals practice who specializes in helping clients use social media.

Vanessa:  Welcome Debbie.

Debbie:  Thank you Vanessa.

Vanessa:  Starting off, I’d like to know why social media is important to my business.

Debbie:  Well you know there’s a few reasons Vanessa that make it really important. The first one I’d like to give you is a bit tongue in cheek. If your business depends on people and relationships to drive your business and your business results, then you absolutely have to engage in social media. So that kind of makes it relevant to absolutely everybody and all businesses.

Consumers are flocking, for personal reasons, to social media channels. And you heard a lot about them: Facebook, Twitter, Linkedin and Blogs. Now they’re flocking to them for business reasons. I had the opportunity to hear that they had a Facebook Canada talk last month and they were talking about how excited they were to creep up in their Facebook numbers. If you’ve heard last week we are now at 750 million Facebook users, which is really mind boggling. But more importantly there are about 50 million “people to people” conversations every day and there are 55 zero “people to brand” conversations every day on Facebook. So people are not only talking to each other, they expect to have you there as a business as well, because that’s the pattern they’re developing.  So that is one over-arching good reason that social media is good for your business.

The second one would be: You know as a business you spend a lot of time trying to get to know about your customers. You spend money on market research, you ask them survey questions, you do a lot of stuff so you can really understand them. Social media gives you an interesting channel, because you can actually monitor what is going on the different social media sites. Whether they’re blogs, or conversations in little communities where mothers get together and talk about babies. There are communities and groups of your customers that get together around interests already, whether it’s a blog on Italian coffee or a Facebook fan page around a store, or what have you. So those conversations are going on and you can easily access them to build your own intelligence about what your customers want. So this should be a dream come true as far as customer knowledge is concerned.

Then thirdly, they’re darn good business tools the social media channels, and the ability to use them to support your major strategies. We’ve seen some great successes: building brand, taking marketing and sales  to a whole different level. Recently we heard about a financial services institution here in Canada that launched a whole new product solely on social media. You Tube and Facebook alone, had 5 million impressions in the first week of launch which cost them less than a full one-page print ad essentially. Therefore cost savings and the reach are incredible.

Product development: You know businesses are developing products with their customers. They’re recruiting employees of course, and it’s difficult to find terrific talent, so the closest you can get to the sort of person that fits your business the better off you are, and you can do that through social media. Also servicing customers in a just in time way – big opportunities there.

Vanessa:  Well that all sounds fabulous! All of those points you mentioned really depend on folks being engaged in social media and social media tools – so how can you be sure that this is not a flash in the pan? Should I wait a year of two before I get into social media to make sure that this is a permanent change?

Debbie:  That is a really good question, and a lot of customers ask that question. There is a simple and direct answer to that question – Should you wait? And the answer is “NO.”

The reason is... well we clearly see the consumer adoption rates so we all agree that social media is not going anywhere. If anything, it’s only the early stages so we have yet to see how it is going to evolve and grow. This is the first couple of years. The interesting thing about using social media, that there’s not a lot of expensive nouveau technology practices to invest in; so in the old days as a business you would say “Let me wait, let me let my competitors totally mess up on buying the wrong platform, and things like that.”  But this is really about building relationships through conversations, and engaging with customers, so why would you let your competitors communicate and engage with customers as you stand back and watch. Really doesn’t make any sense.

My horrible analogy is to a wedding. You know you can’t really expect to be racing to the altar on the day of, saying “Will you marry me?” without having done the dating dance for the period before. So you can’t just fast forward and immediately have a relationship, you got to start, you have to listen and engage with customers on all these platforms.

Vanessa:  Interesting. So definitely go ahead and build relationships. Now, we’ve touched upon on the business perspective, but what about the customer perspective? How is the customer experience different with social media?

Debbie:  Well I would probably say that it is different and it isn’t. So how is that as a double edged sword? It isn’t the same experience as other channels because the rules of the game are different on social media. There is different ways of conversing that are rule of thumb: authentic conversations. The expectation is if you’re having a quick Twitter conversation with 140 characters, it’s not just one way messaging, you’re not just telling your customers what’s going on, you’re listening to your customers and engaging in a conversation so they expect to be authentic as far as customers are concerned. They expect instant response: this is about real time. You know if I put out a tweet saying “You suck because you shut down my credit card”. The expectation is that somebody answers me, and they answer me in less than 48 hour email response kind of thing.

This is 2 way: so you can direct all the brand messaging to me that you want, but if you try to do that on social media channels without me being able to engage, that’s breaking the rules and you’ll have to get ready for the ire of your customers. So I think that the scary part in rules of the channel is that everybody engages, so you often have an audience of you know 50 thousand watching you handle an angry customer; or watching you handle a happy customer. So it’s important to make sure that your people are trained to service on these channels as well.

The second thing to keep in mind that, Vanessa is Vanessa on Facebook as a channel, so when she interacts with a brand she may be on Facebook but then she may  go into the store, and she may call the phone centre channel, and she may be on her phone picking up a coupon. So she expects one continuous Vanessa experience.  So if I start on a web store on Facebook and I pick up my coupon, I expect the people in the store or the branch to know what I’ve just done. So it needs to be a seamless experience.

Vanessa:   Really interesting. So authenticity is really important. This isn’t just about pushing out marketing collateral on a new channel. This is about approaching the market in an entirely different way.  It’s about having a two-way conversation. Interesting. So I heard a lot about social collaboration and social media, so what’s the difference?

Debbie:  Good questions. Social media is usually used as the bigger definition. So social media and all of the types of medias and channels and platforms we talked about, all the web technologies, all the mobile technologies under social media; they simply take a conversation or a communication and turn into interaction, interactive dialogue because it’s two way. So it allows you to have a two-way or multi-way conversation.

Social collaboration sort of notches up the game a bit, because that’s usually people getting together to work on a common goal. So it’s not necessarily just a conversation or an interaction, but there’s actually a common interest that we have together and we’re building something together. So usually with social collaboration, we talk about internally.

Vanessa:  Interesting! So we really focused our discussion so far on the enterprise and the external world. What about business operations and the internal perspective?    How can social enable my business operations?

Debbie:  A number of ways; and we’re seeing some really interesting practices with companies and corporations now. One of the interesting ways which is coming through on social media, is customer service. Actually using social media platforms for customer services purposes. So Twitter is an easy example to really  illustrate; because if you can imagine following your business, your brand on Twitter, once you have some sort of an issue, or you are picking up a new product which typically customers  have the same questions all the time when they pick  up this new product. It’s really simple to have that kind of information on Twitter and if there’s an issue just having a quick to call button within that Twitter feed. For a customer that gets them directly into the part of the website they need for their answer. Or click to call a call agent if it’s more important. If there is a system down, then it’s really easy to have a system alert, you know if anyone travels on transit, it’s really nice to know that the subway systems are going to be operating. So that ability to service instantly and customer service, very interesting.

The other customer service piece is customer forums. So you see a lot of business actually create places for their customers to communicate and collaborate, whether it’s on their website or a separate community. If you can imagine it’s like extending your own customer service course so that your customer become customer service. Often on the Apple sort of customer forums, it’s the Apple customer who answers first before anyone from Apple, when it comes to issues.

I think the other business operations, the other two things to think about, is employee engagement. It’s so important in this world to make sure that you have the greatest talent you need in order to deliver your business results and the ability for employees to get together in their own communities inside is tremendous, because they can speed up responses to customer questions or needs and they can have instant access to experts. So it really notches the game on innovation.

I think finally the most excitement is around product development. So what we’ve seen is businesses actually using customers to develop products that the customers want to buy; which is unique and crazy, but there you go!

Procter & Gamble for example have a forum called Vocal Point, that anyone can register for. They just listen to their customers. Often now they actually will introduce a new product in this particular forum and they will actually ask: “If this is a new product, how much would you pay for this?”

So it’s quite interesting because they can actually reverse engineer their whole supply chain: “Well looks like this product is worth $3 to most of the people here as oppose to $15, so how can we change that?” I think those are some of the operational ways that it can really transform your business.

Vanessa:  Fabulous! So that was Social Media, but what about Social Collaboration? What can that do for my business? Isn’t that just like an Intranet?

Debbie:  It probably is like an intranet, with a lot of social engagement. So the intranet of the old age just keeps getting evolved. I think the brilliant difference between an intranet application and a social collaboration inside, is the power of social networking: internal social networking, so imagine taking the power of the team. So if you can connect all of the employees with the same skills that you need and put them against an issues or an opportunity, then you have the power of the network as oppose to just one employee trying to find another one who might know something about this audit issue or this product spec or something like that. So you can actually have whole communities solving issues in real time.

And I think the auxiliary benefit of internal social collaboration is getting rid of the bad habits of email systems and large enterprises. You know those CC strings that go on forever... You never really get to the nub of the issue unless you been on the 30 emails. So if it makes an employee’s job easier and faster because they’re part of a social community, it’s almost like they can get rid of the noise of email by being part of a social collaboration site.

Vanessa:  Well I imagine it would really improve productivity. I know I waste a lot of time following those kind of email trails. So we talked about all those fabulous things associated with social media and social collaboration, but what about the other side? Are there any big risks to deal with as companies get into social?

Debbie:  Absolutely, I am happy to scare you. There are risks. We talked about the fact that there are different rules of engagement on social media channels. So the fact is that in the old days brands could control all the communications because really they were one way. Now it’s two way. There is no control. So it’s not that someone is controlling the social media conversations; no one is controlling the social media conversations. However if you don’t participate as a business, then you are not part of it. So yes, the risk is the lack of control. Is it a bigger risk not to be there while your customers are talking about you? Definitely.

Another risk is probably the customer expectations we talked about. So if you’re talking about channels where the expectation is real time response, we see the figure rising around customer expectations. Placing something on Facebook, Twitter or a blog, the expectations around the firms responding to them within an hour at this point. That’s kind of generally the average which is really kind of linked in social media, because everything happens within seconds. So they’re being generous customers, but there’s still this expectation which is a risk, if you can’t deal with the expectations. Even if the customers aren’t talking directly to you as a business; they just put it out there on their status and they still expect a response.

I think thirdly, certainly businesses are trying to come to grips with what happens when content is created outside of your firewall, and you have terrific... called the “F” factor: friends, followers, and fans - and they’re taking flicker photos of themselves with your products or in front of your bank branch or what have you, making video clips and what have you. So where does that reside in your marketing materials in how you respond to it, figuring out your responses to those things is a great way to mitigate the kinds of risks that can happen when your content gets mashed up with other content.

So I guess the bottom line is that there are definitely risks, and it’s important to figure out what those risks are and then build a plan to respond to them and go for it.

Vanessa:  Well Debbie we are almost running out of time. But before we go, perhaps you can leave us with some advice that you would give to your business clients on social media today.

Debbie:  Absolutely, terrific. I think the major piece of advice would be to start now. Actually get into social media because it’s a great time to learn and experiment, and I’m talking about calculated learning, and not just crazy experimentation. Your customers are extremely forgiving in the early days so it your chance to actually try different things with them, set your enterprise strategy, and what I mean by that is what is the business issue or opportunity that you really want social media against.

Business case it, use all that great monitoring that you’re doing around what your customers are talking about so that you can actually choose a customer group that is desirable to you. Pick a product or a life event that you’d like to launch a pilot around on how you can engage them, and make sure you plan to scale or plan to exit in case it goes wrong. Have an operational road map because what we’re finding is, though things may begin in social media in the marketing and communications groups,  the only way to sort of raise a village around a customer is to make sure your whole organization is involved. So engage your phone channel people, engage your operational folks, engage customer care, so that you can integrate social into your entire business in the long run.

Vanessa:  Great advice Debbie, thank you.

Debbie:  Thanks Vanessa, it was great to be here.

Vanessa:  For more information, or to download a copy of Debbie’s recent article: “The power of social media” please visit our webpage at www.pwc.com/ca/social.

 

Announcer: This concludes this episode of strategy talks. Thank you for listening. We hope you will join us again soon for another episode. To download or to subscribe to this podcast series, or to find more information, please visit pwc.com/ca/strategytalks. The information in this podcast is provided with the understanding that the authors and publishers are not here and engaged in rendering legal accounting, tax or other professional advice or services. The audience should discuss with professional advisors how the information may apply to their specific situation. Copyright 2009 PricewaterhouseCoopers LLP. All rights reserved. PricewaterhouseCoopers refers to PricewaterhouseCoopers LLP, an Ontario Limited liability partnership or as the context requires, the PricewaterhouseCoopers global network or other member firms of the network, each is which a separate and independent legal entity.

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Hosted by Helen Mallovy Hicks, a Partner and National Leader of PwC’s Valuations, Forensics & Disputes Practice, and Calum Semple, a Partner in the Operations and Consulting practice, Strategy Talks is a series of audio podcasts that explore key issues affecting businesses in Canada, and share strategies that companies can use to help address them.
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