Before you hire those Social Media Services

Categories: Social Media, Web IndustryPosted on May 19th, 2008

Social Media, an in demand service, spurs traditional vendor offerings
There are more and more advertising, interactive firms, search engine marketing firms that are starting to offer social media services, but be warned: before you buy, do your homework and check out if they are walking the talk.

[Many traditional marketing service agencies are now offering social media services, often as a bundled service. But before you buy, do your homework and do a thorough background check]

A few years ago, I was developing and evangelizing the social media program at a large company. I was a full time employee, and was a low level web marketing manager. We started to kick off the CIO blogs, and the advertising agency and their partners got whiff of this. To their credit, they were one of the first to whisper the idea into the VP of Marketings’ ear, yet, I’m not sure if they understood what it would take to make the program work.

Vendor offers $110,000 blogging solution
Eventually, we hired one of their partners to do social media measurement, in fact, they did a pretty good job, however, it soon lead to a new proposal where the ad agency and the social media measurement company came into HQ to give a fancy 2 hour presentation to the Directors and VPs of marketing.

All of this is fine, they were proposing a full blogging solution, which included measurement, design and hosting, and strategy recommendations for $110,000. Back in 2005-2006, this seemed like a lot for a grass roots effort, but I’m sure that there are now proposals in the million dollar range, that include full consultation. In fact, in Josh and Charlene’s recent presentation indicate that the overall cost of ownership for GM’s FastLane blog to be over $100,000 per year (with a positive ROI).

Outsource when your company doesn’t have the skills
All of this is fine, in fact, I frequently recommend to clients to seek outside expertise as often, these skill sets are not native to many organizations, and the change in communications is so radical, often outside help can really pull towards success.

But make sure the vendor walks the talk
So what was the problem? The problem with the Ad Agency and their Media Measurement partner was that they didn’t have ANY experience with social media, in fact, they couldn’t even show they had a blog, either work nor personal.

[The proposal for the $110,000 full service blogging strategy and solution looked good on paper, except that the vendor didn't even have a blog, professional or personal]

So how could we trust them to build a program if they weren’t walking the talk? While I’m sure there’s many firms that are smart enough to figure out social media without ever doing it, there’s a matter of experience and credibility that comes along with actually doing it.

Recommendations:
I’m seeing more PR, Interactive, Search Marketing, Advertising, and other Marketing firms offer social media services (often at a hefty price tag) but before you buy, do the following:

1) Check online to see how they are using social media. Is it authentic, are they part of the conversation? are there trackbacks indicating they are conversing with others?
2) Get referenced from their clients, since many of these programs are public, you can easily find out who’s involved, either with or without the vendor.
3) Ask the social media vendor to clearly state their expertise, and demonstrate a strategy plan, ask for examples and details.
4) Ask them to answer the tough questions, the ones you’ll have to answer to your COO and CFO.
5) Get more than one proposal for work, aside from traditional marketing services, also get a proposal from specific social media agencies.
6) Get recommendations for vendors from social media platform vendors, find third party reports, and join user groups with your peers to get objective opinions.

Related Resources
For related data, read my colleague Peter Kim’s thoughts and report on The Connected Agency. And for what it’s worth, both the agencies are still in business, and have adopted the tools, I wish them both the best.

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This entry was posted on Monday, May 19th, 2008 at 5:59 am and is filed under Social Media, Web Industry. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

Good points Jeremiah.

as u twitted, they had no street cred, but luckily for them, they learned &, I’m sure, are better for it now.

As they say: Adapt or Die!

BTW, it’s incredible (but when I think again, maybe not) that GM’s blog’s TCO is that much. I bet there are folks that could probably do it just as good if not better for half the price.

Posted by eMarv on May 19th, 2008 at 6:30 am

eMarv

Download the presentation, each of the costs (and benefits) were spelled out. The blog was written by the CEO, so that was the greatest cost, by far.

The good news is, that the blog was a positive ROI.

Posted by jeremiah_owyang on May 19th, 2008 at 6:37 am

[...] you hire those Social Media Services Before you hire those Social Media Services Many traditional marketing service agencies are now offering social media services, often as a [...]

Posted by etc… :: Before you hire those Social Media Services on May 19th, 2008 at 6:53 am

Jeremiah

I see this already with the ad agencies jumping in but with little or no real understanding of what web 2.0 or social media really means. Yet, they have the ‘ear of the Board’ and are able to get the deals. To a certain extent the buyer is ignorant and in some cases prefers to remain so and let an external vendor get on with it! This is not ideal but still reality.

Peter

Posted by Peter Gold on May 19th, 2008 at 7:56 am

Awesome tips. Now I know I should be charging more for my services

Posted by Danny Choo on May 19th, 2008 at 8:21 am

Very good advice on this topic. We’re seeing many more agencies who sell a client on Social Media, then contact us to help them with the measurement and more importantly, the operations of their proposal. So many smaller agencies see the wave and want to surf, but don’t have the ability to swim….

Always, always, always check references and work done. Don’t settle for a url either, ask for their initial objectives for the site and how they measured success. Then ask how they calculated their success metrics. Pretty sites only go so far…

Posted by Mike Rowland on May 19th, 2008 at 8:31 am

Danny

Some think this pricing is high, but this is a full service solution with various team members, I’ll bet that the cost will just about be break even, or even a loss of the first project.

Posted by jeremiah_owyang on May 19th, 2008 at 8:38 am

Good tips, thank you.

I’d also site the flexibility in pricing. With so many up and coming vendors, I don’t believe pricing in this space has matured. There seems to be a premium on any offering tagged with Social these days…. BUT - often MUCH more flexibility on the negotiation side than traditional and more established vendors.

Posted by Len D on May 19th, 2008 at 8:43 am

Len

I also know that there’s a lot of hype around anything tagged “2.0″. Caution.

Posted by jeremiah_owyang on May 19th, 2008 at 8:47 am

Jeremiah,

I agree that companies should proceed with caution, however, using whether the company has a blog as a barometer isn’t the greatest solution, because, in my opinion, not every company needs a blog, even if they are social media geniuses. I know of a few creative agencies that are social media marketing pros, don’t have a blog, but have a true understanding of how to map strategy to tactics in social media. My suggestion is to understand their approach, maybe get some case examples, and yes, see how they use social media themselves — but, are they using it for a particular goal or strategy, or just to be a “me-too.” Forget the me-too’s.

Posted by Robin Seidner on May 19th, 2008 at 9:00 am

Robin

A few questions for you:

Would you agree that social media is different than other forms of marketing?

Is there something to be said about experience of actually doing and learning a new form of communication?

Posted by jeremiah_owyang on May 19th, 2008 at 9:30 am

One of my personal favorites was a pitch that went to some senior executives at my firm (and elsewhere) for an SEO shop whose own name didn’t come up until the second or third pages of results in Google.

Essentially, that voted them off my list before I even looked at their capes.

Posted by Tom Biro on May 19th, 2008 at 9:33 am

Robin,

There are companies that can do this well, but they have at least some kind of online presence. How can you trust a company that pitches a blog but doesn’t have one?

Far too many agencies sell Facebook, MySpace, Social Networks, and other “Social Media” projects without having expertise in house, or even having a clear idea of how to charge or what to measure. Way too many companies think hiring social media experts means hiring 22 year olds with Facebook accounts. And it shows.

As these firms are used to billing big numbers, they end up creating fake blogs, astroturfed microsites, and spam commenting teams because they have to justify the cost. The real crime is that that it takes just as much effort to create fake results as real ones.

It’s not everyone, but it’s an alarming percentage of the people I run into.

It’s not limited to big agencies - there are plenty of SEO, PPC, and Web design consultants who add “social media” services by adding a GoDaddy blog or Stumbling pages on a website.

Just growing pangs, I hope.

Posted by Jim Durbin on May 19th, 2008 at 9:47 am

hmmm - there is another problem. If you’re busy working on social media projects for your clients, you sometimes don’t have as much time to work on it yourself.

It’s that cobbler’s kids have no shoes problem. It’s like web designers that have old sites themselves, or bloggers who don’t update because they’re writing for money.

But there should always be something you can point to, and if you sell your services, you ought to at least be aware of what you’re doing.

Posted by Jim Durbin on May 19th, 2008 at 9:58 am

Jim

The trick is to learn how to use the social media tools to improve client relations at the same time!

Posted by jeremiah_owyang on May 19th, 2008 at 10:40 am

Jeremiah,
Good post and so very true. I used to work for a PR firm that provided video and tried to get into the blogoshere. They basically made all the same mistakes you describe. Creating outlandish bids for a basically “free” product, pitching blogs to indivduals outside of the marketing department with no control over branding and lastly exectuing our own corporate blog HORRIBLY. The “about us” page had video of the CEO’s kids playing with his dog in the back yard, coupled with his prediction that by 2007 all blogs would be video. Oh man!

Posted by Greghay on May 19th, 2008 at 10:44 am

Absolutely agree. Why should a client throw six figures at you to create something that you don’t think is important enough to have for your own company?

Also, to your point about using your own blogs/podcast/social media connection to improve client relations - totally true. We’ve seen several relationships furthered through the communication of using our blog. Additionally, Twitter and facebook have helped build stronger partnerships for our clients.

Posted by Scott Parent on May 19th, 2008 at 11:02 am

I would add make sure you have some good questions about how they intend to execute. I had a bad experience with a company that new how to create some interesting material, but they didn’t know anything about how to actually get the attention of anyone online. Needless to say, that particular effort was a total flop.

Posted by Davey on May 19th, 2008 at 11:29 am

Yes, I do think social media marketing is different than other forms of marketing, my only point (and Jim Durbin talks to this) is that you should look to a firm that understands social media enough to know what works for them (which may not be a blog — maybe they are serial commenters or tweeters or podcasters, etc).

Just like in other areas of marketing, not all forms work for all businesses (some like SEO, probably do, others, like direct mail, may not, but that doesn’t mean there is no expertise). For me, the key is finding a consultant or agency that understands that tactics should only be developed out of strategy. What are the goals? Tactics are driven from goals.

My original point was perhaps not clear — don’t choose a firm just because they have a blog. Not every company needs a blog or can manage and do a good job with a blog. And, yes, I really do believe that.

Posted by Robin Seidner on May 19th, 2008 at 11:42 am

No one is suggesting to choose a vendor just because they have a blog, but if they’re selling such a service, we should expect them to demonstrate success.

Posted by jeremiah_owyang on May 19th, 2008 at 12:13 pm

There are a lot of numbers being thrown around here — some make sense and some don’t. I don’t buy the GM Fastlane numbers, for instance. They appear to be posting only once or twice a week, and I still question the numbers. Do the Fastlane numbers include: the time of all involved (including the CEO)? the related activities required to make the blog a success (like monitoring and moderation)? the cost of servers/bandwidth, etc., or hosting? Three years ago I did not think there was a business in working with large companies to get their blogs up and running. Since then I’ve worked with a number of Fortune 500 companies in this area and my view has changed. For instance, most Fortune 500 companies are not going to allow an open sourced, free software platform to be used. Many want .NET applications which drives up the cost and complexity. Many large brands will want a near bullet-proof IT architecture with back-up which will drive up the cost and complexity. When a large, popular brand blogs successfully they can drive significant traffic which is a wonderful “problem” to have, but that also increases the need for moderation and, thus, cost and complexity. Periodically an executive will say to me (based on their personal blogging experience): “We should be able to set this blog up and be posting in 20 minutes.” We’ll then spend 30 minutes just figuring out who in the company needs to be involved and when and where the project kick off meeting will be held… First and foremost, check the references of your prospective social media consultant. If they have not created an impactful, sustainable social media initiative for a brand of your size and stature you better think twice.

Posted by Paul Walker on May 19th, 2008 at 12:30 pm

Paul

Go download the report (link in the main post) your questions will be answered. Yes it includes all costs, fixed, software, and time of a very well paid CEO.

Please go check that out first, then we can drill into numbers.

There are no numbers being ‘thrown’ here, these are all factual.

I enjoy your points about some of the total costs!

Posted by jeremiah_owyang on May 19th, 2008 at 12:32 pm

Thanks, Jeremiah. The post says “over $100,000 per year…” and the slide says $285,000 which is more realistic. Take care.

Posted by Paul Walker on May 19th, 2008 at 3:43 pm

[...] thinkers in the social media space, contrasts the posts of Marc and Simon in his recent post, Before You Hire Those Social Media Services in which he points out that “there are more and more advertising, interactive firms, search [...]

Posted by Mike Stopforth » The Lesser Of Two Social Media Consulting Evils on May 20th, 2008 at 7:55 am

Great post, but the conversation here and in other places is a little demoralizing. I’m part of a group of genuine social media philosophical faithfuls who are still in the process of learning all there is to learn. Working with mainly B2B clients, we’re taking baby steps to ensure accountability. We get more red lights than green when proposing a social media supplement only when appropriate.

But these conversations make me think that I’m not allowed at the big boys table because I don’t have the experience that others do. I end up holding a grudge against those who abuse the glam and hype of social media to rake up costs. I don’t want to be thrown into the crowd of social media d-bags. I twitter, post comments, FB and share useful information when I can. But I feel caught in the circle of “i need XP to get the work, but i need the work to get XP.” Like you suggested, the only way to prove yourself is to show that you at least have some meaningful interaction online. Hopefully that’s enough.

Thanks,
Brian

Posted by Brian Block on May 20th, 2008 at 9:12 am

Brian

No disrespect meant.

This isn’t a good ol boys club, anything bud. The intent here is for companies to use these tools to improve relations with their customers.

The problem lies with some vendors wanting to sell these services without the experience to do it right, and that’s a problem.

You mention you’re in the process of learning, and that means you’re in the process of experimenting, exploring and actually using the tools you recommend to clients. Therefore = you’re fine.

I hope you feel engaged, excited, and pumped about the opportunities, never demoralized.

Posted by jeremiah_owyang on May 20th, 2008 at 9:25 am

[...] is amazed that a social media agency is offering a $110,000 USD blogging platform (as reported on Jeremiah Owyang’s [...]

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Posted by Caged Ether: Corporate Blogging, SEM » $110K corporate blogging solution on May 28th, 2008 at 1:29 am

Good stuff, and clearly great minds think alike - I’m writing a similar post as we speak.

I’d like to add that I don’t think you have to show examples of your own work to prove your abilities, necessarily. A marketing agency can pitch billboard design without having one of their own. Of course, showing your own and being able to talk about success/failures/learnings always helps.

But every agency I’ve ever worked for has always had the cobbler’s son problem. I’m not saying that’s an excuse for getting out of the hard work, just that the reality is that it’s often too difficult (wrongly so) to justify investing in themselves.

And in theory, an agency large or small that understands the larger picture of “social technology” would and should be able to work on a project that they don’t necessarily have experience in building because they have the larger picture experience. I help clients look at building forums around their brands, for instance, but I don’t have a forum of my own. I help clients build ambassador programs, but I don’t have one of my own. But I understand the larger picture enough to understand how to implement such programs. (Again experience is always better)

The problem in many agencies is that the implementation and strategy development are as far away as the two pieces can get from each other. Find out from the vendor/agency who is actually implementing what they’re selling. That will speak volumes.

I’ve actually been pleasantly surprised lately at the number of clients and potential clients who are looking to hedge their bets by bringing in a social strategist like me to help act as a middleman between the vendor and the client business. This role is not tied to the business or the vendor (especially not the vendor) and can help the client understand when there are better solutions or when the vendor isn’t quite on track. The person in this role can be highly experience because you’re using them for a smaller amount of time than the agency, and the theory is that they’re less tied to saying whatever the client wants in order to keep the business flowing. (Not a sales pitch, just a case study)

Posted by Jake McKee on May 29th, 2008 at 9:27 am

I understand the cobbler’s shoes dilemma, but the reality is that if you believe in social media, and sell social media, you should be making use of social media in your personal or business life to some extent.

Social media when leveraged properly has great potential to help businesses grow their online presence. Company blogs are just the tip of the iceburg.

Vi Wickam
Zello Partners
http://www.zello.us
Online Marketing with Eye-Popping ROI!

Posted by Vi Wickam on June 17th, 2008 at 1:36 pm

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Posted by The Need for Social Media in Marketing | Social Marketing Direct on September 28th, 2008 at 6:25 pm

Some of them are like that. So anyway thanks for the tip ans advice.
___________
Pratul
SEO

Posted by Pratul on November 9th, 2008 at 7:22 pm

This is the same thing that happened with SEO. This is great advice to clients.

Posted by Jennifer on March 9th, 2009 at 4:07 pm

Thanks for the article.

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