UNDERSTANDING THE TRUE DRIVERS OF SOCIAL MEDIA

PREPARED FOR SOCIAL MEDIA STRATEGIES– SANTA CLARA, MAY 18-19

@FGOSSIEAUX

WHAT IS ACTUALLY HAPPENING OUT THERE?UNDERSTANDING THE TRUE DRIVERS OF SOCIAL MEDIAWHAT IS HYPER-SOCIALITY, AND WHY NOW? HOW DOES HYPER-SOCIALITY SCALE?HOW DO HYPER-SOCIAL ORGANIZATIONS THINK ABOUT THEIR BUSINESS?WHAT DO HYPER-SOCIAL ORGANIZATIONS DO DIFFERENTLY, AND WHY?HOW DO HYPER-SOCIAL ORGANIZATIONS GET STARTED AND SUCCEED?EXERCISE – AND WHERE DOES THIS ALL LEAD?

OVERVIEW

THE SAP DEVELOPER COMMUNITY

LET’S START OFF WITH A LITTLE EXAMPLE HUMAN 1.0 VS. WEB 2.0

The SAP Developer Network

4

Stats:1.4 M users400K+ business expertsContent-richOriginal Incentive System:Point system leading to

personal rewardsThe Results:Bullying behavior in the

communityNew Incentive System:Point system leading to

donation to good causeThe Results:No more bullying in the

communityWeb 2.0 or Human 1.0?

A look at some NIH + Duke Research

Experiment #1:

People play Atari-style video game which allows them to earn or lose money for themselves

MRI scans shows that the pleasure side of the brain lights up – that same part that gets addicted to drugs

Experiment #2:

People play Atari-style video game which allows them to earn or lose money for a charity

MRI scans shows that the altruism side of the brain lights up – that same part that is responsible for social interactions

So to understand how to do business in a 2.0 world…

You do not need to understand the Web 2.0 technologies

You are better off understanding Human 1.0 – not as individuals, but as

hyper-social creatures

LET’S GET A LEVEL DEEPER ON THE HUMAN 1.0…

Why are social beings helping one another?

Reciprocity = a Reflex

Why are people going out of their way to punish others?

Humans have an innate sense of fairness = keeps reciprocal society working

Why do people like to look like others?

Because humans have mirror neurons

Why do we lie to market researchers?

Because we lie to ourselves and others, and we tell people what we think they want to hear

Why there is no real (big) business in the long tail

Because we are a herding species, and a self-herding one to boot

Why is status so important (and why do we hoard it)?

Because it used to get us a better mate – proceed with caution: status works both ways!

What are the important Human 1.0 Hyper-Social Traits

• Reciprocity – it’s a reflex that allows us to be the only super-social species without all being brothers and sisters

• Social framework of evaluating things vs. market framework

• The role of fairness in assessing situations

• The importance of looking cool and mimicking others

• Herding and self-herding(early research shows that social behavior does not change when it scales)

So to the extent that we can basically be human

with what we know, and share it as freely as we

possibly can, I think we’ll go a long way towards

gaining a higher or stronger level of trust with

the consumers.

Barry Judge, CMO Best Buyhttp://www.cmotwo.com

AND HOW IS IT IMPACTING BUSINESS?

WHAT IS HYPER-SOCIALITY AND HOW DID IT SCALE?

What is Hyper-Sociality, Why Now, and Why is it important to Organizations?

• Technology, connectivity, Moore’s Law allow our innate Hyper-Sociality to scale

• Mass media is no longer the only show in town

• Organizations (and their functions like marketing, product development, sales, customer support, knowledge management, HR) were structured in a Hyper-Social vacuum.

• The companies that can mirror their constituents’ Hyper-Sociality will be best positioned to succeed

Symbols, signs, rules, and culture let reciprocity scale

Reciprocity scales beyond Dunbar’s 150 people because of signs, symbols, rules, and culture

THEY THINK DIFFERENTLY ABOUT THEIR BUSINESS

SUCCESSFUL HYPER-SOCIAL ORGANIZATIONS

Informed by Tribalization of Business Study:2009 – 430 Companies took the survey (52% external communities, 32 hybrid, and 12 internal)

In the old days

Hierarchies within organizationsOld: legal employee contracts

Mostly 1-1 customer relationshipsOld: legal customer contracts

Marketing

PR

Customer Support

The new world order

Hierarchies within organizationsOld: legal employee contracts

New: cross-functional social contracts

Mostly 1-1 customer relationshipsOld: legal customer contracts

New: social contracts

CIO’s

Green Enthusiasts

Product Idea

Business model tweak

PR

Customer support

Hyper-Social companies think differently: a recap• Think tribe – not market segment

– We need to find groups of people who have something in common based on their behavior, not their market characteristics

• Think knowledge network – not information channel– The most important conversations in communities

happen in networks of people, not between the company and the community.

• Think human-centricity – not company-centricity– The human has to be at the center of everything

you do, not the company• Think emergent messiness – not hierarchical fixed

processes– People will want to see responses to their

suggestions, even if it does not fit your community goals – FAST

“…affinity groups will quickly become the dominant social

force in the emerging world

economy, changing how we think about markets, fads, social

movements, and, ultimately, power”

- Tom Hayes, Jump Point: How Network

Culture is Revolutionizing Business – 2008

WHAT IS IT THAT THEY DO DIFFERENT?

HYPER-SOCIAL ORGANIZATIONS

Hyper-Social Orgs – Leveraging Social Business Processes

• Successful Hyper-Social organizations turn their business processes into “social” processes– Why?

• Scale• Increased quality• Increased passion• Increased WOM

Turning a business process into a social process• IS NOT:

– Running traditional programs using social media platforms – PR by blogging press releases, lead gen by spamming community members, recruiting through spray and pray over Twitter, etc.

• BUT IS:– Running programs based on human reciprocity

and social contracts to get others, whose job it isn’t to do so, to help you do your job – customer support with the help of all employees and customers, product innovation with customers and detractors, etc.

– TAPPING INTO PASSION, AND HUMAN 1.0 TRAITS

25

Process Before After Benefits Case Studies

Sales One-to-one Many-to-many Sales is social networking

Tibco, Zappos

Product Innovation Constraint to a department

Includes all employees,

customers, prospects and detractors

Reduce product failure rates (now at

80%)

Cisco, Netflix

Lead generation Interrupt-driven Become findable, be generally helpful in public conversation

Leads that actually want to buy something

EMC, Dell

Customer Service Conducted by employees

Conducted by employees and other

customers

Customers service as a revenue source

instead of cost center

SAP, Zappos

Knowledge Management

Top down process Federated and user-driven process

KM that works, changes in work habits

IBM

Customer Communications

Mostly between companies and

customers

Primarily among customers, detractors

and prospects

Reduced cost and increased

effectiveness

Best Buy, Dassault Systemes, Fiskars

Talent Acquisition and Development

Board, interrupt-driven and based on

weak ties WOM

Endorsed by the tribes people belong to

Social context provides better

matches

Monster.com

Employee Communications

Mostly within silos Cross enterprise Increased serendipity, increased support

IBM, FedEx, Cisco

Market research Based on small groups and financial

incentives

Based on tribes and social contract

Much more accurate market data and

increased success

Eli Lilly, Pfizer, IBM, Fiskars

PR & Thought leadership

Rolodex based and focused on traditional

media

Community/tribe based and focused on

social media

Much more amplification of the

messages

Microsoft, Intuit

Any questions?

Francois GossieauxPartner, Beeline Labse. francois@beelinelabs.comw. http://www.beelinelabs.com b. http://www.emergencemarketing.comc. http://www.marketingtwo.netp. http://www.cmotwo.com

Our new book: The Hyper-Social Organizationhttp://www.hypersocialorg.com

26

Brainstorm – a getting started exercise

• How will you get started? – What process do you pick?– Why?– How will you kickstart it?– How do you measure success?

• How do you scale it?• What are the biggest obstacles you are expecting?

– How will you overcome them

EXTRAS

HOW DO THEY GET GOING?

HYPER-SOCIAL ORGANIZATIONS

Many paths to success (and many paths to failure too)

• Assess Hyper-Social readiness (plan is to get benchmarking info on this from 2010 Tribalization of Business Study)

• Find the tribes and their leaders – internally and externally:– Who are they, what makes them tick, what is their

language, what is their shared symbolism, where do they hang out, etc.

• Start pilots that matter - and measure them the same way you would measure the impact of any other program

• Set up infrastructure to:– Measure cross-functional impact of programs– Scale the program to where it makes a difference

in business

Compared to other CMO’s I consider

myself lucky. Dell Hell put our brand under pressure and so to

engage in social media was actually a

question of survival….you cannot get into social media

by just putting a toe in the water - you are either all in and it

becomes part of your culture, or you’re not.Erin Nelson, CMO Dell

(cmotwo.com)

Further down the line

• Look at new measurements – e.g., customer equity measurements to better reflect impact of WOM

• Monitoring and understanding the behavior of active lurkers – the largest active member group of any community (32% of companies are starting to measure)

• Think of expanding your employee pool by encouraging more people to participate

• Recruit for a Hyper-Social future– Different talent– Different leadership

Smaller questions to ask yourself

• Are your marketing/employee programs reciprocal?• Would you send collateral to a friend of yours?• Do you know what 20% of your collateral gets used?• Are you recruiting for skill or behavior?• Are you ensuring diversity in the recruiting process?• Are you tapping in the social realm to recruit?• Is your KM extending to your customers?• Is your CRM customer-centric or account-centric?• Is it focused on transactions or relationships?• Is it focused on the past/present or the present/future?

Legal Considerations• What’s legal good for anyway?• Key Hyper-Social legal issues:

– Hiring (unlawful background checks, lawful off-duty conduct)

– Disclosure of trade secrets and/or proprietary information

– Privacy (employers may run afoul of SCA; waiters)– Harassment– Wrongful termination– Defamation (of company by employees?)– Disclosure of nonpublic material information

triggering securities law issues– Negligent referral based on social network references– Unauthorized use of company logos, trademarks and

copyrighted– Material (employees posting other people’s content

to corporate site)– Labor laws

Derived from Morgan Lewis analysis at http://www.pli.edu/product_files/EN00000000081353/49749.pdf