Feature Getting on top of social media

Getting on top of social media

Social media is:

• Accelerating at an enormous pace
  
• Giving the consumer the power of the pen
  
• Reshaping how we do business
  
• Creating significant business risks
  
• Necessitating the need for a policy and strategy
  
• Creating new business opportunities
  

The social media racehorse has bolted. It’s young, fast-paced, high-spirited and can throw off the most experienced rider. Like it or not, the beast is here to stay. It’s just a choice of letting it run wild and causing havoc in your paddock or managing it, observing it and harnessing its potential to become the greatest of winners.

For many of us techno-nannas, the term social media leaves us cold. So what exactly does it mean? Ross Monaghan, a lecturer at Deakin University’s School of Communication and Creative Arts, says: “Social media is essentially online media in which anyone can communicate, share or collaborate with other people on the web.” Whether those people are around the corner, on the other side of the city or the globe, “they can discuss issues of interest, edit and write information on any topic and within seconds publish it to the world”.

This may be in the form of a blog, forum, wiki or through some of the more popular platforms such as Twitter, LinkedIn, MySpace, YouTube, the “new kid on the block” FourSquare or Facebook, which has just hit a staggering 500 million members.

Regardless of which platform you choose, and which is in vogue, the appetite for social media is insatiable and accelerating at an enormous rate. Rattling off figures from Nielsen’s Asia Pacific Social Media Report, James Griffin, a partner at social media advisory and monitoring firm SR7, says: “On a global scale, close to three-quarters of the world’s internet population have now visited a social networking or blogging site. As for Australia, it leads the world in social media engagement, with the highest global average for time spent engaging with social media of over seven hours a month.”

As the statistics show, when we’re talking about social media, we’re no longer talking about a trend dominated by spotty teenagers with low-rise trousers. It is also certain that social media is not just a fickle trend that will disappear as quickly as their latest pair of trainers.

As Monaghan notes: “There’s a perception that social media is just for younger people when that’s not the case. The statistics show almost half of Australian adults have contributed something to a social media site. The fastest-growing area in social media is the over 55s, so organisations need to understand there are relatively few areas in the community that aren’t using social media now.”

David Redhill, partner and chief marketing officer at Deloitte Australia, has recently seen a phenomenal influx of business requests regarding social media.

“Social media has all of a sudden become mainstream,” he says. “Just in the last six months, we have certainly noticed that the ASX 100 are coming to us seeking knowledge and insight into the way we have managed the social media and developed a social media strategy.”

According to Redhill, the effect of social media on businesses and their corporate and retail brands is that it is eroding the boundaries between audience and content provider. “Feedback, opinion, point of view and reactions to new products or strategies by an organisation are now instantaneous… Whether it’s a product, innovation or brand, you will get an idea very quickly of how it will be received, and then take the next step in developing it.”

This quick, continuous loop, he says, is very different to how business has traditionally worked. “Big ideas” used to be researched, launched quarterly or annually and then measured after the effect. “Social media is very intrusive, so nothing can be hidden in an organisation and the market can’t be surprised anymore. There’s always ‘twitter’ going on so it becomes a series of events – a continuum.”

Leslie Moore, general counsel at Deloitte Australia, adds: “Boards need to know their employees, clients and the general public are all using social media and the chances are that their products are being discussed, evaluated, recommended and unfortunately trashed on social media. It is a profound shaper of public opinion and customer opinion about the brand and the company.

“Secondly, there is an expectation by the general public that the company will interact on social media and join in that dialogue. The public also expects that the company will be truthful and transparent and will actively demonstrate it is the type of partner with which customers want to be engaged. So how the company handles itself on social media is going to be an indicator to the customer as to whether it is a company from whom the customer would like to buy products. The board needs to understand the power of that constituency in shaping the types of communication going out.”

When shaping that communication, Greg Daniel AM, executive chairman of SR7, says it is important to understand that the explosion of social media has empowered individuals. “Marketers have to realise they can’t just push messages out to people to be received in a passive manner anymore. Consumers now want to engage in a two-way dialogue with companies, institutions and government departments.”

With individuals more empowered by social media, mass markets have become a sequence of micro-markets. Daniel says this means marketers need to communicate with a variety of groups. “They need to not only communicate with them, but have a dialogue with them. This is a very different mindset to running a bunch of expensive television commercials and hoping people take notice of them. One of the beauties of social media is that you get real time 24/7 feedback so you know whether your message is effective or not.”

But, he adds, the main messages consumers are now listening to are from fellow consumers. “Social media has morphed in the last 18 months from being a pure communications tool to being a research tool. Facebook, for example, recently passed Google Search as the number one visited website in the US and has exploded in its usage as a research tool. Instead of going to Google, people are now going straight to Facebook to find out what other people are saying about companies, products and services. There are very interesting statistics around believability. Nielsen research has shown that 78 per cent of people will believe what other people are saying either negatively or positively about a product, company or service on a social media site. This is opposed to 16 per cent of people believing advertising.”

Monaghan says individuals have, in essence, become potential media outlets. With traditional media turned on its head, we have seen how social media has given the consumer the power of the pen. As well as the external boundaries being broken down between the organisation or content provider and the audience, the move to social media has meant internal boundaries within organisations have also become blurred. Who exactly is the content provider? As Monaghan points out, traditionally an organisation had a select few trained staff who would speak on behalf of the company to the media. Now, with the mainstreaming of social media, every employee has that access and capability.

Monaghan recently did a straw poll on his undergraduate students, asking how many of them have posted comments about their casual employment. Out of a lecture theatre of 100 people, well over half of them put up their hands. “Employees are talking about their organisations and work places,” he says. “That’s something organisations need to get to grips with.”

And, so do their boards. “The biggest thing boards need to understand is all the significant risks associated with social media,” says Monaghan.

So what are the risks? “The most obvious one is reputational damage,” says Moore. “Secondly, there are breaches of confidentiality or improper disclosure of confidential information. The issue is the potential range of disclosure. If you drop a hardcopy document, it may be picked up by one person. But if you breach over the internet, millions of people have access to disclosure. With platforms like Twitter, it is much harder to control.”

A third risk, says Moore, is defamation. “The core issue is publication. Again, the issue isn’t too different from that occurring with other forms of defamation in print or in speech, but when you are dealing with the likes of social media, the potential for millions of publications is staggering. And, you can’t stop it because it continues spreading.”

Next is bullying or harassment. “In an employment context, an employee may be bullying, harassing or discriminating against other employees using social media. In some cases, the employee may be using a personal blog, but the action may still affect the organisation directly.”

Moore says other issues to be aware of are breaches of privacy and of continuous disclosure. “Traditional corporate channels of communication are set up to ensure market-sensitive information is properly vetted and checked. But what happens if market-sensitive information is released over Twitter?”

And there are the risks of misrepresentation or breaches of trade practices legislation. “You might ‘puff’ a product casually with somebody online. If that person relies, to his or her detriment, on that information and suffers a loss, you may have inadvertently misrepresented a product on social media,” says Moore.

“The risks themselves haven’t changed. The issue with social media is the speed of transmission and the range of events that can occur.”

Daniel adds: “We are now talking about the largest medium in the world that is growing at an exponential rate. The risks are far too great to leave anything to chance. There are many examples in Australia and internationally where a lack of preparedness to handle a social media crisis has led some companies into very pretty damaging situations.”

Food giant Nestlé became the centre of a public Facebook and Twitter showdown earlier this year. The feud began when Greenpeace launched a social media campaign, including an alarming YouTube video parodying the famous “Have a break, have a Kit Kat” slogan. It became a viral hit.

The campaign exposed Nestlé’s use in products like Kit Kat of palm oil, an industry that is driving the destruction of Indonesia’s rainforests and pushing orangutans to the brink of extinction. When Nestlé tried to force Greenpeace to remove the video, it encouraged the general public to storm it’s “unsuspecting” Facebook fan page with comments and a modified version of the Kit Kat logo.

The situation turned into an ugly mess when the manager of the Facebook fan page started getting argumentative and rude. Unprepared, slow and unprofessional in its response, Nestlé came out of the fight with its reputation badly damaged and has become a case study of how not to use social media.

Monaghan believes Nestlé got it all wrong from the start. It wasn’t just the way it dealt with the disaster but its philosophy as a business and the misreading of public opinion in the years leading up to the event. “Social media isn’t just about the software. It’s not about the technology. It’s about the philosophy. You need to be open, honest and transparent and if you’re not, people will talk about you on line. They will share information about what they don’t like about your organisation and it will spread virally very quickly. Nestlé found that out to its detriment.” Monaghan says a few years prior, Greenpeace talked to a number of chocolate companies about the environmental impact of palm oil. Some agreed to work with Greenpeace to come up with a sustainable compromise. Nestlé decided not to.

“So when Nestlé set up a Facebook fan page asking people what they liked about chocolate, they very quickly started getting comments from people saying we don’t want to talk about that, we want to talk about the fact we don’t like the palm oil in your products. Although Nestlé had set up the space to talk about the positive aspects of the food, people were adamant they wanted to talk about the negative actions it was taking. It’s a great example of how, if you don’t have your ducks in a line, you can set yourself up for a fall.”

In April 2009, Domino’s Pizza also found itself at the centre of a social media crisis when a controversial video was posted showing staff in the US tampering with food before delivering it to customers. Within just two days, the video had been viewed by more than a million people on YouTube. Griffin observes: “In just a few days, Domino’s reputation was damaged. The perception of its quality among consumers went from positive to negative, according to the research firm YouGov, which holds online surveys of about 1,000 consumers every day regarding hundreds of brands.”

What saved Domino’s, though, was the speed at which it reacted and its preparedness. It immediately tracked down and fired the employees, and called in the health department. “Domino’s Pizza reacted within 24 hours to the video,” says Griffin. “Its response was an apology address on YouTube, the same social media platform used to post the offending video, giving the online world an opportunity to absorb the apology video as immediately as they did the original. Importantly, Domino’s appeared to have a social media ‘worst case’ scenario plan that it put into action.”

Griffin adds: “Each crisis is unique. It takes a fair amount of analysis and human understanding to work out what, how and why it has happened and to know how to deal with it. There’s no blanket approach. As part of an overall social media strategy, we often formulate, practice and test social media crisis plans. Developing a crisis plan and dealing with the risks and issues is a critical component of an overall social media strategy and one that shouldn’t be overlooked.”

Moore observes: “The potential for reputational damage through social media is quite stunning – and it’s particularly the speed with which something negative can be sent around the world through social media or electronic communication. “Each person has on average 250 Facebook friends. They may send it on to their friends [one click], and their friends may send it on to their 250 friends [two clicks], who send it on again [three clicks]. In just three clicks, it has reached over 15 million people.

“For that kind of damage control, you need the same crisis-response team as you would have with a fire in a building or loss of confidential information of an extreme nature,” Moore says. “You need a team that knows how to handle wildfire damage to a company’s reputation and that is able to respond quickly. It would be useful for boards to have given this issue some thought and to have a plan of action in place in case they ever need it.”

Monaghan agrees. “It is absolutely essential that organisations have a sensible e-policy that suggests to employees how they should interact in the online environment when representing the company. They should then start to think about training and look at the induction of new employees. They should ensure younger people and newer people in the organisation understand their online responsibilities.

“These employees are going to be on social online media as soon as they finish work or during work, whether it is on their phone or PC, so they need to understand that what they say as an employee of an organisation can affect its reputation.”

Griffin says that when putting together a social media policy it is vital to consider the culture of the organisation.

“The social media policy should reflect how that organisation wants its employees to engage with each other and with customers on line. It should also provide the employee and the employer with a good framework and set of guidelines so everybody knows what is acceptable and how the social media can be done in the work place and after hours. It should also reflect the overall strategy once that’s been done. “

In April 2009, Telstra become one of the first corporations in Australia to put together a social media policy for staff called the Three Rs. It stands for: “Respect – being respectful to people and to the environment you are participating in. Representation – representing yourself or identifying yourself as the Telstra employee. Responsibility – in terms of confidentiality of internal business and products.”

Telstra’s social media senior adviser Mike Hickinbotham says: “We wanted to make the Three Rs easy to read and to avoid the very official language often used in corporate policies around the globe. We saw the Three Rs not as a series of guidelines but as simply a set of guard rails to help support the employees and the corporation.”

A few months later, Telstra launched interactive staff training on the Three Rs policy. Kristen Boschma, head of social media and online communications at Telstra, says: “You’ve got 40,000 staff living and working all across Australia and you want them all to comply with a policy that pertains to social media and networking assets. And, those assets have a worldwide reach, so you have to ensure the staff train on that policy and that they understand it.”

To reach its audience, Telstra developed an interactive training program in a comic-book style. “Rather than just putting the policy on line and then doing an online test, we decided to tackle it in a social media-complementary way. What’s interesting about that is we then decided to release that course publicly. We made it available to companies all across the world – to say ‘this is how we trained our staff and you’re more than welcome to borrow or copy this course if it helps your company’. We are still getting emails from people across the world.”

Moore says companies may want to approach their social media policy differently from other policies. “Your constituents might be quite passionate about the development of this policy. If you look at companies’ harassment, bullying and discrimination policies or the privacy policies – those are quite standard and the content is quite set. The social media policy, in contrast, is talking about how people in your organisation are going to be communicating with each other within the organisation and outside it. People have quite a stake in it. So our suggestion would be to involve a broader range of voices and stakeholders than you might otherwise in creating a policy. You want to get the buy-in of the people using it.”

Moore suggests having people of different ages, including younger employees, commenting on the policy and giving suggestions on how to use it and how to work with it. “The language and style of the policy are important, and the level of formality. The policy needs to be short. If your people are Tweeting and used to communicating in 140 characters, you certainly don’t want a seven-page policy. So in a sense you are really thinking about that audience and almost Tweeting to them to get your points across.

“From a Deloitte perspective, one of the hallmarks of our policy is that we’ve made a decision to empower and entrust our people to use it appropriately. There’s been quite a good response to that approach because people want to be using social media appropriately and they want the organisations to trust them and their views.”

Daniel, however, warns that there are no short cuts. If you think you’ve got social media covered in another policy, you probably haven’t. “Our research shows many companies that may think they are covered in this area are not covered. Unless the policy is specific about social media it can prove ineffectual.”

Once you have all your “ducks in a line”, and you have all your risks covered, the power of social media cannot be beaten. It can create new business, improve internal communication and processes and build strong relationships with clients and customers like never before.

Monaghan notes: “Social media is a great opportunity to facilitate communication across an organisation. So people from different departments and geographic locations can communicate quickly and share a whole range of information. Whether they use audio, video podcasts or wikis, in terms of knowledge management, communication and innovation, the benefits for an organisation are huge.”

And, as Redhill says: “If you don’t have a social media policy or position, you are actually letting your competitors discuss and conclude where you’re at. Nature and business abhor a vacuum, and if you don’t define and continually reinforce your brand in that space, others surely will. So having a clear social media strategy is not just a ‘nice to have’ – it’s an essential if you don’t want to be at a competitive disadvantage.”

So train social media to your advantage, take it by the bit and drive it down the home stretch to the winning post.

Growing your business via social media

As a small business owner with a limited marketing budget, Angela Vithoulkas, co-founder and director of VIVO Group, has essentially built successful businesses on the back of social media.

A true experimenter and avid fan of social media, Vithoulkas has her own website, blog and Twitter account that she uses for the public-speaking and small business consulting parts of her business. She also has an avatar, “Little Vivo Lady”, whose twittering is projected in another of her business interests, her café.

“She’s a mix between Basil Fawlty and an Australian waitress. She has her own identify and blog. She adds entertainment to the café, communicates on today’s specials and comments on customers,” says Vithoulkas.

The two sides of her business are very different. They have different audiences, clients and customers. They also are two very different brands. But Vithoulkas says: “Social media helps us promote and grow both businesses. We just use a different emphasis.”

A great benefit, says Vithoulkas, is that social media is free. By running campaigns on Twitter and more recently FourSquare, she is bringing more and more customers through the door as well as catering contracts. “Through a Twitter contact, I was recently asked to be part of a Lawson’s bread promotion. As well as getting paid for the event, I was able to reach 2,500 potential customers, gained exceptional media attention and was given three spots on radio – in terms of advertising that would probably have cost me about $10,000. All for free.”

Questions for management

Telstra’s Kristen Boschma highlights some questions that boards should be asking management about their approach to social media:

• What is the purpose of our use of social media program? To solve customer complaints? To listen to customer feedback? To promote our products and services?
  
• What outcome do we expect from our activities?
  
• Do we have the technology and resources in place to really make it work?
  
• Are we going to commit ongoing resources to continue the conversation?
  
• How are we going to monitor and measure whether our social media activities are delivering on our objectives?