A new report by Channel Insider that covers the $450 billion marketplace of solutions providers suggests many solutions providers remain unfazed if not optimistic of the immediate future despite being in the midst of a great global recession.
According to CI “shifts in business technology consumption and new delivery systems are forcing the rapid evolution of the technology solutions sales and services model.” The greatest projected increase is 38% in Software as a Services (SaaS).
The report advises services companies to resist conventional wisdom that they should cut back on marketing and ramp up sales imprint with existing customers, and instead perceive the current crisis as a transformational period wherein struggling businesses will be forced to adopt new technologies and business models to push ahead to a brighter future.
I have witnessed this firsthand in the social media space where cutbacks in advertising spend on conventional print, television, radio, and banner ads have shifted budgets towards direct engagement models across blogs, forums, and social networks like Facebook and Twitter.
I believe that technological advances in mobile and digital will continue to collapse advertising, marketing, PR and customer service departments into one another as consumers increasingly demand two-way dialogue with brands, and the companies that prepare for the future by listening to their customers will be the ones best equipped to become market leaders in years to come.
Picture from Geek and Poke under their Creative Commons License.
Facebook has grown exponentially particularly among 35-54 y/olds, who continued to be the fastest growing demographic at an even more accelerated rate of 276% in the last 6 months. You can examine the 2009 statistics thanks to iStrategyLabs
I believe this growth pattern can be understood by what I call the gentrification of Facebook. Here’s my hypothesis:
Facebook began as a network exclusive to college kids, who had to reach a critical mass of 1,000 per school to enter the network. As Facebook opened up to the public, it then opened up its platform to third-party developers to build a variety of applications. “Cool” innovators flooded through the gates, quickly giving rise to what could be considered an online gold rush.
Venture-backed companies, agency and marketing folks, and developers built a seemingly limitless number of applications that were quickly added and shared, and “social media” entered the marketing vernacular as the new umbrella term for these types of innovative technologies. This accelerated adoption beyond the college kids and eventually snowballed to make the 35+ demographic the fastest growing on Facebook.
The ironic thing is that nobody uses applications anymore, perhaps because the concept was canibalized by so many bad applications. Few are very useful or relevant, and they are on the way to becoming a novelty item used only by marketers who are six months behind the curve, particularly with the newly revamped fan pages. As this happened Facebook also put in place minimum advertising buys at $100k/month, the rich folks had indeed started to take over the neighborhood.
The pattern I see within Facebook strikes me to be similar to the gentrification process I’ve witnessed in my neighborhood of Williamsburg, Brooklyn. The trendsetters of innovative artists were replaced by trend followers of rich NYU kids, and ultimately prices in rent rose, new restaurants opened, and the wealthy people opened profitable businesses and developed condominiums.
I think gentrification is really a name to describe the canibalization and consumption of cool, and it can be traced through discrete sites created to facilitate exchanges. In my neighborhood this would be between the new businesses and the “hipster” – a pejorative trope for the jaded kid that was too cool to do anything productive – whereas within Facebook it would be the profile holder and the application developer.
In the wake of the application gold rush status updates became the most significant feature for many users, fueling a frenzy of friend adding to establish a social network defined by short conversations, comments, link sharing – the types of menial distractions professionals love during a work day. It will be interesting to see how Facebook continues to evolve in the future, but what I really want to know is, what are all the cool kids up to now that applications are no longer cool?
Pic below a piece of social commentary on gentrification from Williamsburg, Brooklyn, taken last weekend on my iPhone.
Social media can accelerate the spread of branded messages by making it convenient for people to share with friends and family. The right mix of content and execution can drive astronomical results, while paradoxically barging into a conversation like an elephant can adversely damage a brand’s online reputation.
Particularly in today’s economy when budgets are being slashed a lot of brands and agencies want to move into social media. My experience has taught me seasoned marketers often approach social media like they do any other media buy. This is fundamentally problematic because online influencers don’t like most marketing.
Napoleon became one of the most celebrated generals in history because he learned in the field how to divide armies with precise artillery. He subsequently built strategies for tactical military strikes that his enemies simply could not account for or adapt, and won many victories against sizably larger foes. Social media experts must push back against recommendations from above that they know will not be effective. Napoleon complexes are good things in social media, and here’s what brands should do to find their tactical generals and win the battle to connect with consumers in meaningful ways:
- Seek out experts from the field and listen to their recommendations. When they seem wrong, push back for clarification, what you perceive to be intuitively right might in fact be a bad fit for social media.
- Just because someone spends a few hours on Facebook, Twitter, and watches YouTube videos does not qualify him or her to execute on behalf of a brand. In fact, they may be lazy potheads who do not follow directions well (if so, this should not necessarily preclude you from hiring them).
- Stop thinking about metrics, seriously. Most people likely tuned out your media buys, so the truth is, most of your existing metrics based on eyeballs probably lead you to make erroneous assumptions about your ROI. Think creatively about how to create new Key Performance Indicators and less about how to adapt old media buying models.
- It’s not about you. If you don’t add value to a conversation, then be quiet and stay out of it. And conversely, if your legal department has problems, then hire other attorneys. You can defend against a misrepresentation on Twitter easier than you can a rumor turning into 100,000 people participating in negative word of mouth.
- Publish or perish. People are talking about you, and soon every site will have social media functionality. Remember 10 years ago when reporters used to say “live via satellite?” They don’t any more because it’s just what every network does now when reporting. It was once amazing that a steam engine beat a horse in a race. Don’t be the horse.
- It’s what people do – it’s not media. People go online to connect with one another, learn and exchange opinions, make informed purchase decisions, etc. They don’t think “hey, I’m going to use social media!” It’s just what they do. Don’t get caught up in industry vocabulary that makes you sound smart or transforms social media into something experimental.
- The biggest social media partner is not necessarily the best. This is the heart of the Napoleon complex. Look at case studies of potential partners and think if they can scale based on your needs. If they can, move forward.
- Always On, Not Always Planned. Social media engagement is a process of dynamic discovery – engaging in conversations, learning what people are saying, then acting based on the needs of online consumers. Campaign-focused approaches do not work because the goal of social media is to build relationships, not to serve media. If you spend too much time trying to plan, you’ll miss your opportunity.
- Trust Your Team. You may not understand social media, but your team will. Hire experts and trust them to execute. This corresponds with the need to stop planning, let them report and push messages but not be beholden to multiple agendas. The same core audience online might be the target for multiple campaigns in a given year. Social media does not always line up with other media channels.
- It’s not rocket science. Things change, people change, technologies change, life and communities change. There are best practices to tip the scales in your advantage but social media engagement is not science.
- Be bold, be loud, and be funny. Don’t’ water down your message. Most creative goes through a series of edits and revisions, and often the best ideas get dumbed down and somehow become, well, dumb. Trust your gut and go with it, if it doesn’t work, at least you have your integrity.
I hope this helps. This post is intended for those who control marketing budgets considering entering social media. It is based on extensive experience working with global agencies and brands when I was at Heavy, Spongecell, Visible Technologies, and M80, and is not written specifically for any of my clients, past or present.
 Things sure have come a long way since the news rooms of the old days! Over 500 publications went out of business last year, and an additional 100 in 2009.
Not surprising, have you picked up a magazine lately? They’re pretty thin on the ads…
An unfortunate consequence of the global economic recession is many conventional businesses have to change the way they operate. some for the better. The Big Three automotive companies are making hybrid cars with better gas mileage, and now publishers are looking for ways to distribute content digitally. Ironic that tight finances have been the catalyst for changes that benefit the environment within the same industries who lobbied against them for years.
The Guardian announced they are releasing a new API called Open-Platform that will enable people to build applications to distribute and license their content. See Forrester Analyst Jeremiah Owyang’s Web Strategy post for discussion of the possibilities for developers, who first turned me on to the story.
The broader implication I think is that as publishers struggle to monetize their content, and the internet becomes saturated with data, marketing spam, and frivolous chit chat, the monetary incentives decrease to create quality content and increase proportionally to your ability to organize existing content and make sense of the clutter. Online search has increasingly become less useful when there is a need to find particular, relevant information surrounding best practices, specialized fields, because keyword phrases don’t always work.
It will be interesting to see how developers respond to the Guardian, and to see what the future holds for the publishing industry in the future.
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Thanks for visiting Think. Now. Yes. This is an evolving resource center dedicated to exploring ways in which we might view the current volatile economic climate to be an opportunity for change and a better future.
TNY combines the years of experience I have working with brands and agencies in the social media and experiential marketing space with my background studying new religious movements during my Ph.D. studies at Princeton. As I learned how to successfully move branded messages across social networks like Facebook, Twitter, and MySpace, as well as blogs and forums I came to recognize patterns in online behavior that were strikingly similar to how religious movements spread.
Although seemingly incongruous when people get caught up in theological questions, as human institutions religions in many signify the oldest and most resilient forms of branding on the planet. From the dawn of civilization to the present religions’ success has been contingent upon their ability to continually adapt, co-opt new technologies, change messages, and evolve to meet the needs of their communities and stay relevant in ways that most companies can only dream.
As I sat on a beach in Tulum, Mexico (pic above) it occurred to me how their resiliency and relevancy has little to do with the compulsive obsession most marketers have with Return On Investment (ROI) and statistical models that inform most advertising decisions. In fact, historically most religions that followed the status quo became replaced by newer practices who better related to people in more relevant ways.
I think the current economic crisis can be viewed as the culmination of greed and self-interested views of the world that date back to the colonial impulse. We simply need a different way of thinking rooted in values of inclusion and sharing that are perhaps best exemplified by the type of behavior people exhibit online. The technology we refer to as “social media” has made it possible to build meaningful relationships based on common interests in ways that are unprecedented in the history of humanity.
Think. Now. Yes. is dedicated to providing the resources and inspiration to survive and band together so we can redefine our future. This is our moment, we will overcome.
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