Marketing and Advertising on the Social Web
Adapted with permission from Grouped: How small groups of friends are the key
to influence on the social web
by Paul Adams
Copyright © 2012. Used with permission of
Pearson Education, Inc. and New Riders.
The Rise of Permission Marketing and Word of Mouth
Increasing the reach of advertising campaigns will no longer work
Most advertisement campaigns are focused on how many people can be reached with their message. Often, basic targeting happens, which is in line with how the marketers have positioned the product. But in many cases, the advertising is shown mostly to people who have no interest in, or need for, the product or brand being advertised. The approach is that if we show the message to enough people enough times, some of it will stick. The focus on reach using interruption advertising is simply a means to an end. It’s the solution to not knowing who will be interested in seeing your ad. Instead, the goal should be that enough people will absorb and believe in your message to increase sales and keep the business profitable, rather than to reach as many people as possible, or even a certain number of people.
The tactic of increasing reach by interruption advertising campaigns is no longer feasible. Because of the exponential increase in the amount of information accessible to us, and the increase in the number of marketing messages we receive each day, increasing reach will no longer have much impact.
We need to move away from interruption models, and towards permission models. We should build campaigns by asking people whether they are interested in hearing from us. We then communicate with these people, and rely on them telling their friends to get us the desired reach.
Permission marketing happens when people give marketers permission to send them messages. Clicking the Like button on a brand’s Facebook page is an example of permission marketing. People click Like because they are interested in the brand, and in doing so they give the marketer permission to place posts in their News Feed. This is where it gets interesting. When people see those posts, they are much more likely to click Like or to comment on the post than if they had been interrupted by the marketer. Their interaction with the brand is then shown in their friends’ News Feed. So with permission marketing, you’re not only reaching people interested in your brand, but you’re also reaching their friends.
The amount of permission can increase over time. As the relationship builds between the marketer and potential customer and people start to trust the marketer, they give more permission to access personal data, which helps the marketer create more relevant content. It is a positive, reciprocal relationship based on mutual trust.
Permission marketing and word of mouth
As we saw with the Facebook News Feed, permission marketing becomes even more powerful when the people who gave permission pass on content about businesses to their friends. People have always passed on information about businesses to their friends offline, and the social web is now promising to do that online. The social web is making word of mouth measurable. We can see who is directly connected to the brand, which of their friends they spoke to, and which of their friends became connected to the brand by consuming their content.
We now have a platform capable of delivering permission marketing and word of mouth at a scale that rivals any other communication media. It’s possible to gain permission from a relatively small number of people, and reach millions of others through those people’s friends. People’s social networks scale exponentially. If the average Facebook user has 130 friends (See the latest figures here. that means that they have approximately 10,000 friends of friends, and over 1,000,000 friends of friends of friends.
If a Facebook page has 500,000 fans (fans are people who clicked Like), the friends of those fans total 60 million people. Five million of those people are strong ties. In other words, if these people talk to their closest friends about your business, 5 million people are hearing about your business from someone they trust deeply, and who has a disproportionate amount of influence over them.
In a world of too much information, people turn to their friends
Permission marketing and word of mouth are becoming more important because in a world of too much information, people turn to their friends for advice. Businesses can no longer push information at people and expect it to be absorbed. The world of push marketing is over. Information is more likely to be absorbed if it comes from friends. Aside from the higher level of trust we place in our friends, they will talk about things in a more approachable tone than an official marketing message will.
The social web is making it much easier to get information from our friends about businesses, and people value this. When buying online, 79 percent of people look for the opinions of their strong ties (See the 2009 eMarketer report on “Social commerce on Facebook, Twitter and retail sites."). In fact, because of the breakdown in trust with marketers, they value information from people they don’t know over information from the business itself. When 5,000 people were asked what they wanted most from a commercial website, 64 percent ranked “user ratings and reviews” at the top, higher than special offers and price comparison tools, and 49 percent said they wanted more customer testimonials. (Data from a 2008 Forrester research report. See Jeremiah Owyang’s post “Who do people trust? (It ain’t bloggers)” on his blog Web Strategy.)
Friends are a proxy for relevance On top of the increasing number of marketing messages we’re exposed to, the social web is also generating hundreds of other types of updates, from status updates to photos we’re in to emails. This will increase as many updates become passively communicated, for example, the songs we’re listening to, the places we visit, the articles we read, the games we play. Passive sharing is the direction that technology is moving. Online, interruption marketing is not only competing with itself, it’s competing with activity from friends. And in the vast majority of cases, people care more about hearing from their friends than hearing from a business.
In order for advertising to stand out, it will have to be relevant to people. One way to do this is using people’s friends as a signal for relevance. Another way will be better targeting. As people publish more activity online and we learn what they like, we will get really good at only sending messages to people who are interested in our messages. Although people will still only be interested in brands and activities that they already know and prefer, brands they don’t know about, or have dismissed, can still be relevant and interesting if people hear about them from a friend.
Draft a new type of marketing plan based on permission, targeting, and people’s friends. Use the targeting tools available on Facebook and elsewhere to understand the attributes of different audiences, and the potential reach of people’s friends.
Become skilled at building content that people are likely to respond to. Learn by experimenting with different types; what works will be slightly different for every brand. Start by thinking about social behavior offline and how that might work online. Use the information on what people talk about, and produce content around those patterns.
Building Trust and Credibility
Credibility drives trust, trust drives loyalty
Advertising must build credibility in order to drive sales or influence attitudes. Credibility emerges from a mix of factors such as competence, trustworthiness, expertise, and likability. (For a deeper discussion on what forms credibility, see Kevin Hogan’s book The Science of Influence, Wiley, 2010.) By far the two most important factors are trustworthiness and expertise. People need to be able to feel that you are truthful, responsible, and won’t let them down, and they need to believe that you know what you’re talking about. People evaluate trustworthiness and expertise and decide whether a business is credible. Businesses who want to increase loyalty would be much better off focusing on building credibility, and less on measuring frequency of interactions through programs such as frequent flyer miles. Remember that people make most decisions with their emotional brain, and loyalty programs like frequent flyer miles are aimed squarely at our rational brain.
To be trustworthy, businesses will need to be transparent about personal data
The emergence of the social web has led to a lot of information about people that is being stored digitally. We know more and more about what people like, who they know, and who they trust. This information will really help marketers create better marketing programs, and help them ensure that they are only communicating with people who are open to hearing from them. However, before people agree to letting a business know some of their personal information, the business will need to be credible, and the person will need to be able to trust them. People are wary of businesses storing personal information and using it to target advertising, and there is a fine line between people feeling like they are being catered to, and feeling like they are being watched. (See the 2009 research paper “Americans reject tailored advertising” by researchers at the University of California, Berkeley, and the University of Pennsylvania.)