Update: I’ve now experimented with Specwork to better understand the issue, and will be sharing the good –and bad –on stage on SXSW, read more
Despite the fact that I hired a designer to redesign my blog, I’m wanting to experiment with social tools as I encounter them, I recently deployed an ad on twitter using Magpie, see the results.
Part of my role as an analyst is to experiment with the social tools that I cover. You all know me as a practitioner, and that’s how I learn best –by doing (and making mistakes). Although very controversial, I’ve decided to experiment with outsourcing the creation of my header for my blog, I’m using a vendor called CROWDspring, and offering an award of $250 to the single designer that I’ll choose to accept the banner (and I’ll send them some traffic). Not everyone agrees, and perhaps the most vocal is Andrew Hyde who says spec work is evil.
The system requires me to put the requirements of the design, plus links to some examples, and I uploaded a logo which will be used, and some other background information. Although I just launched a few days ago a few designs have started to come in (see gallery), some I like, and a few that I’m not so hot on. It’s going to run for 3 weeks, and I know that there will dozens of other submissions and I can choose the right one for me.
I encourage you to read my post why I think Spec Work (work being done before getting paid, or not at all) is here to stay. Designers: Why Spec Work Is Not Going Away –How You Should Respond. I’ll also be debating this topic at SXSW in one of the main halls, I encourage you to come (one of my panelists states why he’s grey). I’ll update this post as the project continues, to provide a perspective of what it’s like from the buyer side.
The internet is causing new business models to happen, and I’m a firm believer that this Groundswell example isn’t going away but will only increase.
I spoke to crowdspring, and they even have a corporate service for $1000, and they tell me that some large brands are starting to embrace this system, it’s a direct threat to large existing agencies.
Update: I need to mention that I’ll be doing a review of the experience, and will tell about the good –and bad of using crowdsourcing for design. This isn’t for everyone, more to come later.
Update: March 12 I’ve chosen a winner.
Left: Access the Slides from the USC report on The Impact of the Current Economic Situation on Public Relations/Communication
The USC School of Communication contacted me about their latest study based of 200 PR agencies to find out the impacts of their business during a recession. The report and press release have lots of great data and there are dozens of graphs in the presentation, so in the usual web strategy style, I’ll boil down what’s important to business folks –from an industry perspective.
By The Numbers: Key Takeaways from Forecast Report of PR Firms
Budgets: Half of firms to suffer from 20% reduced budgets
The report indicates that “Half (51%) of responding organizations indicated their FY 2009 PR/communication budgets were smaller than what they actually spent in fiscal 2008, by an average of 19%” (reduction rate). This means that half of PR agencies have had a reduction, right about 20%. On the good side, there was some growth “Surprisingly, 18% of the responding organizations indicated that their PR/Communication budgets actually increased from FY 2008 to FY 2009, by an average of 14.2%.” Although the report warns of some caveats in comparing year to year growth. The remainder of respondents (31%) showed no change, although there’s some weighing to the overall economic changes.
Layoffs: 20% to expect headcount reductions
The report indicates that most will not have any changes “For the current (2009) fiscal year, 73% anticipate no changes in staffing levels”. Although there some anticipate growing their company, and will increase the staff size 15% “7% anticipate growth, of about 15% on average”. Perhaps the most disconcerting numbers is that one fifth plan to have staff reductions “A fifth (20%) anticipate that staff reductions”. How many will be laid off? according to this survey, on average, over a quarter of the company will be cut “averaging to 27%, will occur at some point during the year.”
Compensation: 21% will reduce salary
The report reads that: “For 2009, 56% anticipate compensation freezes, while 21% believe they will have to reduce compensation by an average of 11.7%”. Over one fifth of firms will reduce their compensation, and take about a tenth of their paycheck slices. Now is not the time to buy that new car.
Summation of Findings: What You Should Do
Things don’t look so rosy for the PR industry, but they’re not alone, this is impacting just about every other industry. 20% will have headcount reductions and same with compensation. Actually, that number (20%) is what I’m hearing across other industries, it seems to be a common number that I’m hearing from other sales and executives their being impacted with. That’s of course, small data bits, and not anything scientific. The key trend here is that across the board, most firms will trim their workforce, have less money to work with, and most will not be getting raises.
PR Professionals Must Skill Up
Let’s be honest, those in the 20% that are going to get cut are those that aren’t delivering value to clients –or aren’t guiding the company in a strategic way. Let’s focus on the account folks first. Those that are customer facing and are doing the work for brands, need to stay current with their current skill set. If you’ve not developed social media skills by now in 2009, you are behind, and those that already experimented and folded into practice have a couple of notches in their belt, and experience matters second to having a strategy.
Secondly, those that are management need to quickly adjust the PR firm to offer more outputs for clients than ever before. Understanding not only how to deliver the traditional PR deliverables of strategy, positioning, influence, and monitoring need to also be aware of the changes that are happening in the digital realm as social adoption increases during a recession, and the growth of mobile devices. Update: See which firms score well on the social front, from ZDnet and Cece Lee’s projects.
Buyers Should Renegotiate PR Contract
This one is going to raise hell with PR professionals, but if you’re a buyer of PR agency services, you should renegotiate your fees and contract at a reduced rate. The market simply has changed, and as with every other industry, demand and supply, cause changes. Now, this isn’t to suggest you cut rates and lose the quality of service you’re getting, but figure out what areas the firm is not providing value and reduce those services. On the other hand, you can try to increase your budget with these firms, and ask for services greater than you could have afforded in an upswing, now that you, as the buyer, are in clear control. Update: A marcom director at a large tech company tweeted she already renegotiated her contract with their PR firm, locking them in for a year, at probably a reduced rate, this is both good for the firm and brand as it keeps the cash flowing.
Lastly, it’s not as bad as it sounds, it could be worse, you could be in the newspaper business.
That’s my take on this helpful report from USC, I’d love to hear your reactions what PR firms, PR professionals, and buyers should do.
I’m respecting your limited time by publishing this weekly digest on the Social Networking space, which I cover as an industry analyst. By creating this digest (I started this over a year ago) it really helps me to stay on top of the space I cover.
I’ve created a new category called Digest (view archives). Start with the Web Strategy Summary, then quickly scan the succinct and categorized headlines, read text for my take, and click link to dive in for more.
Subscribe to this blog in your feedreader, or use the email subscription box in the right column. Or you can subscribe to this digest tag only and not receive my other posts.
Web Strategy Summary
This has been one of the busiest weeks to date, so the need for this digest is great. A trend to launch lifestreaming features is taking off, also Facebook extends it’s reach by connecting to commenting systems –expect that to grow even further. Community platform vendors launch education suites and listening tools, and companies like Sharethis that are collecting data have a platform opportunity.
Trends: AOL launches lifestream product
We’re seeing more and more lifestreams appear out of products, as indivudals publish on disparate systems, the need to aggregate in one place becomes important for both personal and brands. AOL launches their own lifestream product, emulating what others before them have done.
Trend: CIOs seeing opportunities of social network
This ZDnet article suggests that CIOs and IT directors are coming around to the benefits of social networks based on a recent panel that had with practitioners.
Launch: Mzinga launches Learning Suite
This Learning Suite is intended to make corporate training socialized by encouraging students to learn with and from peers. With this launch, they’ll extend to different buyers within the enterprise, from sales to HR, but may still have to deal with IT stakeholders.
Launch: Lithium launches measurement suite
I’ve given my thoughts on the product here, this product is a next generation community gauging tool that can help brands identify troublespots as well as receive automated and human recommendations.
Strategy: ShareThis has data, seeks to be platform
Data collection is powerful, but when you are able to make sense of it, it can be monetized to those who want to reach influencers. Sharethis, a popular sharing embed is now expanding their reach and aiming to be a data platform, they know who shares what and how.
Deployment: Facebook connect deploys in comments boxes
Pretty simple deployment, you can now leave comments on blogs that have connected with Facebook, expect more and more of this to happen.
Viewpoint: Google’s view on social network and open stack
Google’s Kevin Marks does a guest post on Techcrunch (it’s not really an interview right?) that discuses Google’s view on the open stack and connective tissues.
Revenue: Facebook and Apps ecosystem grapples with monetization
Adweek stirs the importance of the ecoystem of an application tax that may go into effect in order for Facebook to monetize and drive revenues. There’s been critical eyes cast (myself included) about using advertising on their network to generate revenues. Here’s some options to monetize web apps –and a breakdown of what’s popular.
Culture: Social networks harm children’s development and your health
Interesting research that indicates that social networks teaches children to be too focused on just about nothing. With this reduced attention span and immediate gratification, this causes concern for children who are not learning from the ‘real ‘world. Oh it’s also not good for your health, time to go to the gym?
Elitism? Twitter suggest causes an uproar
LA Times captures the essence: “Some high-profile Twitter accounts have been seeing astronomical jumps in the number of users subscribing to their profile updates — tens of thousands of new followers, in some cases.” many who are not on the list, are well, jealous.
Awards: Social Networking awards by Codie
Who won this category for Best Social Networking Solution the Codie Awards? Dow Jones g2, Dow Jones Business & Relationship Intelligence, Lithium Technologies, Mzinga, Neighborhood America, Inc, RM Honeycomb, RM Educational Software, SchoolNet, Inc. congrats (Update: these are finalists, not winners)
Advertising: Shift to social engagement ads
SFGate suggests that the next evolution in advertisements will pivot around social networks and communities. The challenge is, we’ve yet to see true numbers on click through rates to prove. I wrote a report on engagement ads, do read if you’ve access.
Campaign: Ford reaches for Social Networks for campaign
Pitching it’s cost effective Festiva car, Ford launches the campaign page calling individuals to create a video to explain why they want this car.
Deployment: Innovis launches social network
I meet with a lot of brands that are deploying their own social network, and as a result, we see deployments for every type of vertical, in this case, Innovis launches one for vendors and suppliers.
Privacy: Facebook withdraws Terms of Service
After the dustup last week with Facebook’s change in terms of service, they’ve now retracted, the third time making a mistake when it comes to privacy. Tip: ask first, then act human.
Ethics: Yelp under fire for extortion
Growing social network that allows customers to review restaurants (it’s a decision maker for patrons here in the bay area) is under fire for being accused of being an extortion racket to small businesses. Article suggests that some restaurant owners are offered to remove negative reviews for a few hundred dollars a month.
Hurmous Self-Assesment: What type of Facebook friend are you?
Go on, be honest, what kind of friend are you? I’ll be honest, I’m an exhibitionist.
If you’re a social network, or widget company, I want to know of your news, send me an email, or leave a comment below. Help me stay up to date.
Hungry For Social Networking Stats? Then you should see my collection of Social Networks Stats for 2008 and 2009. Bookmark them, then share it with others as I continue to update it.
I’ve helped dozens of companies define their social media strategy based on research. Often, we conduct custom research efforts to evaluate first if their customers are using these tools (technographics) then we often talk with many stakeholders to find out their thoughts on social media.
Sadly, in some cases, brands that had active customer bases using social technologies were not ready to participate themselves due to culture. Whether is paralysis, legal, or a cultural influence from management, or even location (I did a tour in Japan to find out how social media is growing there).
One example that comes to mind is a financial company I worked with, they are one of the ones that have an incredible amount of money –and a lot at risk as their customers were on the verge of self-connecting to each other without their account teams involved. Despite the clear business need to ‘fish where the fish were’ we advised them not to participate as their internal culture was not ready, there were too many roadblocks.
Recently, after a presentation I gave at the Ominture Summit last week, I was able to meet the marketing manager at Apple who’s responsible for social media. While I’ll respect the privacy of our conversation, I know the impacts of culture on deployment.
What about big companies? Yes, they are a unique beast, and typically organize in what I call the ‘Tire’, where adoption happens at the edges of the company. Let’s lean on IBM’s Adam Christensen who presented this slideshare of how big blue was able to filter social computing throughout the company.
What other companies really live and breathe social computing throughout their DNA? Facebook, Google, Microsoft, SUN, and of course any social media vendor.
Love to hear your thoughts on these questions that many struggle with:
1) Does culture impact adoption of social technologies within a corporation?
2) Even if customers are using social technologies, and the culture is not ready, how will you convince the powers that be?
3) How do you change a top down culture to a bottom up?
Left: Lithium’s Insight Report provides brands with key community attributes, and automated recommendations.
Measurement is more important than ever
I was briefed by Lithium, one of the vendors in my Community Platform Wave report, of their Insights listening product, which they announced today. In the Wave report, I heavily emphasized the need for measurement, here’s a few key reasons:
First of all, “new” media like social is already under scrutiny, measurement was already important.
During a recession, with dollars stretched, marketers are under increased pressure to prove their programs.
Social media, being largely experimental for many brands, need to measure to quickly ‘course correct’ programs in real time.
During times of cutbacks, marketers must know what to cut, and in order to do so, measurement is key.
Go beyond web analytics
Beyond this need, I quickly noticed there are two types of measurements when it came to communities, the first is server analytics, which we already are aware is web analytics, Google, Omniture, WebTrends provide these services. Secondly, the more advanced measurements are ‘community’ analytics that actually track the healthy, influence, and sentiment of a community.
Lithium’s entry to this space, is a blast at Telligent’s Harvest measurement product, the current best-in-class, and Lithium’s Insight product offers community health metrics (in the form of a 6 attributed ‘rose’ graphic), baseline reports, and premium reports with additional services from account managers for the brand wanting the white glove service. Read Joe Cothrel’s blog post to learn a bit about the history of the project, and about the product itself. The Lithium product, which is based off the research from a scientist Michael Wu, they hired that’s conducting similar research to HP’s Bernard Huberman, has been able to identify the attributes that will help predict if a community will be successful within the first few hours of launch. Another key feature is that the community health metrics will not only indicate which attributes are strong or weak, but will offer practical recommendations to improve the community.
Next steps for measurement –and what Lithium must improve
Despite Lithium’s momentous launch for this measurement tool, there’s still more to be desired: 1) Measurement should be based on business objective, not just attributes on a dashboard, to learn more, understand the difference between dashboards and GPS. 2) Although we’ve yet to see great tools to glean opinions, demonstrating qualitative information such as quotes and even sentiment will be the next step. 3) These reports will need to export and be seamless to other measurement systems and dashboards, although they have a partnership with Omniture, there’s still many other marketing tools used for analytics.
Lithium isn’t alone, there are a variety of listening platforms in this space that are offering social media measurement tools, you should also expect the other community platforms to launch competitive products.
Social Media Measurement is important, and now with the recession, critical.
Tremendous amount of customer and prospect data is available in these communities, the savvy vendors are hiring bright minds to analyze what works –and what doesn’t.
Measurement must evolve beyond web analytics and now focus on community insights, vendors are now hiring scientists to help decipher the community ‘code’.
Analytics tools on their own are worthless, without actionable insights, brands will suffer, vendors must provide recommendations.
To be successful, Lithium must continue to partner with the ecosystem around them, customer communities span the enterprise, that’s why I held this roundtable
Expect other community platform vendors to launch similiar products, most will come before the end of Q3 to meet the needs of the recession.
If you’re a customer of Lithium, leave your opinion, or email me if you want to be off the record. I’m your advocate.
Thank god for the recession, as now the social media gurus are on the way out.
One of the challenges of the social media industry, oh, and in case you haven’t noticed, there are a lot of challenges, is that self-proclaimed gurus have appeared from everywhere. In fact, the recession is going to cause those who are unemployed to experiment with the tools on a personal basis, giving them ample ammo to update their linkedin profile as a social media expert category.
But isn’t that the point? Shouldn’t everyone be able to get into the action? Of course, yes. However times are different now, with budgets under scrutiny, layoffs at hands, companies don’t have time for gurus filled with opinion, over-used case studies, and empty books. I was inspired by this charged article: ‘Like pedos in a playground‘ from the Register that exposes some of the weaknesses of the space.
[The recession will force practitioners within corporations to start to focus on measurable results, as a result, they will seek advice beyond opinion and gut instinct]
The recession. This is going to cause a purging of the opinion-makers, pontificators, and the gurus to be passed up as companies need to make decisions based off intelligence, information and references of previous success. Why? their very jobs are on the line, as they have to be accountable for their budgets within their corporations, and demonstrate a return on investment to their management beyond ‘awareness, buzz or thought leadership’.
Aren’t I being a hypocrite myself? Yup. I’m no longer a practitioner as a community manager at a large corporate, nor do I work at a social media vendor helping brands, so in many cases, I too, am looking in the mirror. I write this with a lump in my throat, and it’s a constant reminder that if I’m going to give advice it’s important that I back it up with fact, data, insight, for business people to make business decisions.
So, expect the real practitioners (you’ve see the list right?) to focus on moving the needle to create actionable programs that generate leads, increase sales, decrease support costs, or make innovation more efficient–their jobs are on the line, and they don’t have time for “Gurus”.