On Social Business

Gamification can drive people, organizations and even societies to achieve goals. Ordinary life already has many examples of how gamification drives people. The game of competing for the highest net worth or visible expressions of wealth drives many to pursue wealth far beyond what’s required for a comfortable life.  In a different space, the game of competing for the best citation score drives some researchers to pursue specific publishing strategies.

At a very basic level, most of us use some type of score to track how we’re doing. Think about some of the subtle and not-so-subtle motivations that play a role in life -whether it’s citations, salaries, mile run times, or-for a much smaller group-number of Olympic medals. Creating experiences that embody rewarding “gamification” elements like these can dramatically influence behavior;  and, research suggests the enjoyment and memory of experiences persists much beyond the purchase of a product.

Twitter has been nothing short of a world phenomenon, popular in countries around the world and an undisputed factor in significant political change – and a star for customer service. It continues to grow rapidly, with a recent emarketer study projecting Twitter growth up to 4x higher than Facebook (on a lower base) in 2014. And, there are many of us who greatly value the discovery and connections we achieve through Twitter.

Our own research suggests exposure to social content has a significant impact on brand perception and sales impact (2-7x increased probability of purchase lift based on a restaurant study).  So, the general outlook for social content is bright.

The Problem

Yet even with its success in some high visibility areas and its fantastic growth, it just doesn’t seem like Twitter has quite hit its stride yet.  It has been overshadowed by Facebook and – at least for now – new entrants like Pinterest.

• It’s the #2 social network based on visits, but its current total user active user base is still much lower than Facebook’s (about 1/6 of Facebook in the US, according to eMarketer)

• Engagement is low — monthly average time spent on Twitter (36 minutes) is 91% lower than time on Facebook (6 hours 33 min) and 54% lower than Pinterest (1 hour 17 min), according to Mediabistro/Statista

• As a partial result of this (and probably as a result of other factors such as ad tools and analytics), monetization has lagged, with estimated 2011 revenues of $139.5 million (eMarketer), or about 1/25th of Facebook’s $3.71 billion actual 2011 revenues (S-1 filing).

It seems that these issues are among those threatening Twitter’s ability to increase its momentum with brands and organizations.

The Way Forward

Based on the data above, some of our own research, and some thinking based on work with brands, it appears that there are 3 steps that could make a dramatic difference for Twitter:

What if, instead of targeting 5,000 people, you could achieve the same bottom line results by engaging 500 or even 5 people, at a lower total cost?  That’s the potential of influence marketing.  Is it living up to that promise and will this type of marketing be possible by 2012?

What we do know:

• Changes in consumer attention mean marketing is changing, and the change is dramatic
• It’s becoming clear that one of key players in this change is the individual consumer
• Individuals are playing a central role because they trust each other – often a lot more than they trust companies
• In today’s environment they’re able to better communicate and share with each other – on many things, including products, services and causes

So, do we then target all individuals engaged in social media?  Our thinking is that individuals who are influential can create outsized value.  There’s been a lively debate around this (see, for example, Paul Adams excellent discussion and his comprehensive collection of relevant research links).   It seems to me that most of the debate seems to center around the definitions of who is an influencer.  To us, an influencer is not defined solely by the number of people they connect to.  Quite simply, an influencer is someone who is capable of – and wants to – bring about changes in awareness, perception or action in a group of people, around a specific topic.

In some cases, these influencers are “head of tail”, i.e. have very wide reach.  In other cases, they are pretty “ordinary” people who just happen to have the ability to reach and engage a circle of people in a way others can’t.   In the latter case, they’re the friends who each seem to have their own special expertise – the one that knows exactly which is the best thin crust pizza in town, or the different friend who knows exactly which GPS has the best routing around traffic.    We believe the most impactful and efficient programs successfully identify and use both types of people to achieve their goals.

Here are 3 data points around the value of influence in real world scenarios, drawn from academic research and from our own work:

• An influential fraction of the audience (with modest social networks)  can drive substantial business value.  There’s no clear link between their influence and the size of their social networks: these are generally fairly ordinary people with modestly sized social networks. As an example, for a clicks-focused program that engaged “ordinary” people with varying degrees of social network connectedness, we tracked participant performance in driving clicks.  A small set of influential individuals (< 10%) were able to engage their social networks to generate over 80% of the total program clicks.  While a large majority of these top performers had a somewhat higher than average numbers of friends, there was no significant link between total number of social network friends and the ability to drive clicks.  We did find other factors that were present among the top influencers.
• Individuals highly connected around specific topics can be influential.  A recent paper,  “Identifying influential spreaders in complex networks”, discusses the importance of understanding influencers in the context of their connectedness in specific social networks. Individuals in tightly connected groups appear to form the influential spreaders in a topical social network and can be influential in the spread of relevant information.  It’s not all about connectedness — so-called “hubs” may or may not be influential spreaders.  The image below shows (in the center) an example of a tightly connected group of people (“influential spreaders”):

Can social media drive sales? One recent study found that about a quarter of social network users report having had their purchases influenced by social media. On the other hand, another recent study found that direct clicks from social media sites didn’t generate notable sales. But this type of click study doesn’t really capture the full extent of media influence on consumer behavior.

To take a more comprehensive look at the impact of social media, we tracked a sample group of Quick Service Restaurant (QSR) consumers’ exposure to a variety of brand ‘touchpoints” and obtained pre- and post-tracking data on purchase.

What we found

According to results we are previewing from this new Ogilvy-ChatThreads study entitled Integrated Social Media Sales Impact, there is a strong link between an increase in sales and exposure to social media.

In fact, we found that in the real world, social media exposure – by itself and more broadly when combined with other types of media exposure such as out-of-home, PR or TV ads – is linked with 2-7x higher likelihood of consumption and actual spend increases for some QSR brands.

Specifically, here are some key results, summarized in the diagram and listed out further below:

- Social media only exposure: 7x greater likelihood of higher spend (observed for KFC)

- Social media PLUS billboard ads (out of home): Approximately 2x greater likelihood of higher spend or consumption (observed for the entire QSR category in aggregate)

- Social media PLUS TV ads: 2x greater likelihood of higher consumption (observed for Wendy’s)

- People exposed to social media PLUS news stories or editorials spent 17% more week-over-week (observed for the QSR category)

Interestingly, out of over 60 media interactions studied, social media and social media interactions were associated with some of the highest sales impact of any media. We tracked over 20 touchpoints, including TV, print, out-of-home, social media, news/editorial (PR) and radio.

Download a higher resolution PDF summary slide or see the full preview presentation from our Advertising Research Foundation at the Ogilvy 360 Digital Influence slideshare site We will be releasing the full study in July 2011.

Methodology

The study recruited 404 individuals to use the ChatThreads BrandEncounter™ platform in reporting their real-time exposure to 21 different brand “touchpoints” across five QSR brands: KFC, McDonalds, Subway, Taco Bell and Wendy’s. The study ran in 2 segments between 1/20/11 and 5/6/11. A total of 5,623 touchpoints were reported by participating consumers. Participants were pre-screened for QSR favorability and social media activity within the past week. Shift in consumption and spend (not absolute levels of consumption and spend) were evaluated to minimize any issues related to pre-existing associations between social network use and consumption and spend amount.

The world’s demand for resources (food, energy, water, minerals) seems to be outrunning our ability to supply these needs in a way that doesn’t dramatically impact our lives.  We are increasingly exposed to threats such as core inflation (described recently by Chinese officials as a long-term, not short-term challenge), financial burdens of securing energy supplies (and the cost of investing in new ones),  and the multiple economic and social risks of long-term climate change on our planet and way of life.

The trouble is that, according to “Mainstream Green“, a new report released by Ogilvy Earth, all this doom and gloom hasn’t been particularly effective in driving mainstream consumers to make (and push for) changes to reduce demand for energy and other resources.

In the US, there’s a 30 percentage point gap between people’s stated importance of living sustainably (80% say this is important), and their action (50% engage in sustainable behavior, e.g. taking public transportation or hiking/biking to work; using eco-friendly products and recycling).  (It’s less in China — 14 points — for reasons covered at length in the report.) The mainstream consumer isn’t adopting or championing behavior change.

The possible solution?

Could significant advances in science come not from machines alone but from the clever co-creation effort of both humans and machines ?

That’s the tantalizing promise of a novel social/crowdsourced downloadable game and the focus of a first-of-a-kind pharmaceutical industry-sponsored “protein folding” contest.

So what’s protein folding and why does it matter? The brief version: There are many ways that proteins can fold, and the prediction of the most likely shapes is extremely hard for computers to do.

Yet, the more we know about how certain proteins fold, the better we can design new proteins to combat disease and find cures for such afflictions as cancer and Alzheimer’s. For a longer description of protein folding, check this out.

Enter Foldit: this new game was designed and built by Zoran Popovic’s team at the University of Washington to allow people to fold proteins – without any special knowledge of biochemistry. Foldit uses humans’ ability to “see” in 3D – combined with a fun game environment – to help find the shapes that proteins will be most likely to fold into.

As part of its desire to support innovative work among rising new scientists, MedImmune (an Ogilvy client, and a biologics company that’s part of AstraZeneca) teamed up with Foldit to launch the 2010 University Protein Folding Challenge.

Over 20 teams from a range of leading universities (including MIT, Scripps, Purdue, Princeton, Harvard and Stanford) competed in the 2-week long Challenge, focused on finding an optimal structure for a pancreatic cancer protein.

According to Comscore, over 25 million users accessed Facebook via a mobile phone in Jan 2010, a 112% year-over-year increase.

With its initial US-based rollout of Places location functionality on the 30+ million iPhone installed base, Facebook joins Twitter and others in embracing the growing use of smartphones for social networking.

Importantly, this change allows Facebook to expand users’ social graphs beyond such items as friends, product/service affinities and demographics to now include location.

Here are three thoughts on implications for marketers, agencies and social location startups:

According to the most recent numbers from Inside Network’s Appdata, there are currently over 82 million people – or about twice the entire population of California – playing Zynga’s social game Farmville.

Aside from the growing magnitude of the player base for social games like Farmville, a recently released Information Solutions Group / Popcap study also suggests that these games are reaching a broader and more diverse segment of the population than one might expect.

Here are some of the US-specific findings about social game players from the study*:

- average age is 48

There’s been a lot of interesting discussion recently on how to best leverage channels like Twitter to communicate. This post talks about a bit about the co-creation of new social experiences that drive conversation and engagement in innovative ways, with the potential to then communicate the co-creation activity across multiple channels – including Twitter, Facebook, Youtube and Flickr.

More than ever before, people have tools to help them co-create products and services in social environments. It’s an exciting trend that’s still very much in its infancy. Many of us are familiar with Cafepress, Zazzle and Nike’s custom shoes NIKEiD program. These were early – and still successful – examples of firms that help people remix and create everything from shoes to skateboards.

We’re now seeing signs of continued evolution of this general trend, in areas as diverse as fashion, fabrication and finance. The ideas these companies are introducing will change the way a range of industries introduce, sell and market products. For marketers, these companies all demonstrate useful and innovative approaches to genuine engagement of audiences around co-creation.

Instructables (DIY)
Part of the rapidly growing online “fab” and DIY trend, this site provides one of the best communities centered around creating almost anything – including an Electric Umbrella, Pulled Chicken, a Cardboard Frisbee and even Homer Simpson’s 3D Doughnut Trophy. The site reaches over 4 million monthly unique visitors globally.

John Bell and I formally introduced the Conversation Impact(TM) measurement model at the Advertising Research Foundation’s Audience Measurement 4.0 on June 23rd.  Here’s a brief overview of the model, its goals and planned evolution.

The model was developed by our team to provide brands with a comprehensive, recognizable framework for tracking social media campaigns.   We relied heavily on our experience with a range of social media campaigns for both B2B and B2C clients, and considered the types of questions and reporting requests we receive with every new project or request for information.

We focus on simplicity and comparability across media – the latter, to help guide marketers with media allocation.  We categorize our metrics into 3 areas, corresponding roughly to objectives and “marketing funnel” stages; each is shown below, with representative metrics (the metrics are selected based on unique client needs).   Included are both familiar and new metrics.

Image courtesy of Crimson Hexagon