Google+... that’s been around a while now hasn’t it? It’s hardly taken off as a social network but recently it seems Google have their sights set much higher than that. They know that they can’t compete with Facebook, but then they don't need to. Google are still the most used search engine in the world, they have more traffic than Facebook anyway, so why shouldn’t their social network revolve around that aspect of their platform? Well, Google have slowly been revealing that it does, and I’m here to tell you that it’s a good thing for your business. 

Combined with Google+ Business Pages, the whole Google platform can deliver more for you. It only takes 5 minutes to create a page so there’s really no reason not to. But what exactly will you get out of it?

Be Found Instantly

Not only are Google+ Business Pages another great channel to broadcast your business through, they are also an instant access point for users to reach you as a brand. For example, since the business pages went online big brands like Pepsi, McDonalds and Lexus have all signed up to the service. Users who want information or the latest news from those companies merely have to type + and the name of the company into the Google search bar.

Try it out now and you’ll see that as you type instant search literally offers you the Google+ page of that business, giving users an extremely fast way to access your social stream.

Obviously, if you’ve got a page Google will find that anyway but the Google+ integration with the search engine is just so fast and slick. It’s a service only Google can truly offer within the confines of their own platform and as users become accustomed to this unique Google offering (as we have done with so many others) it could become a winning feature.

Increased Search Ranking

Perhaps the single most relevant thing that will attract those of you who still mostly think of Google as a search provider is the ability of Google+ to improve your search rankings. There’s a new system at work to integrate with Google+ and it works like this...

Say, for example, I +1 something, a page, a product, a business (the +1 system can be integrated all over the web just like a Facebook ‘like’) and then you do a search for it. Because we’re friends (hello!), on Google+ your search results will have my relevant +1’s displayed. This means that users of Google get advice from their friends without even having to ask for it. An absolutely crucial marketing tool if you have a loyal fan base, allowing it to grow by subconscious word of mouth.

Additionally a friend of codegent who knows the guys at Google rather well recently told us that your Google+ page will be (can we say artificially?) promoted up the search algorithm for searches against your brand name. Its a very easy way to boost your search position and dominance of the first page of results.

Access to Your Customers Zero Moment of Truth

There’s been a long standing phrase in the marketing world, “moment of truth”. Traditionally this was broken down into two parts; the First Moment of Truth, when a customer sees a product they like and begins to gravitate towards it and the Second Moment of Truth, when a customer attains said product and uses it, reinforcing their belief that the product was as good as they believed it to be.

This traditional concept of these two moments is 100% accurate and has been proven over billions of sales of products worldwide since the dawn of the modern advertising agency. However, thanks to the connected world we now live in Google has assessed that there is another, more important, Moment of Truth which occurs through social media and dictates a huge proportion of peoples’ spending habits. As we now do more shopping online than anywhere else this makes perfect sense, why would we go out to do research when we have the largest compendium of human knowledge just a mouse click away? Not only that, but the benefit of the experience of millions of other customers.

This, is the Zero Moment of Truth. Gone are the days when you had to get a product home and try it out or luckily come across a good tester model of it in a shop to find out it’s real value to you. Social media doesn’t just drive peoples’ lives socially, though the name may allude to that. In reality Social media drives peoples’ opinions of everything, from football matches, to movies, to physical products. So if I were to be torn between two equally popular products, between Samsung and LG for example, not knowing what to do I might look to their social media pages. If one were to have several million more fans than the other it would certainly seem that their customers had a reason for acting in such a way and alter my perception.

That’s a high level example, but it can be equally important on a small scale, for a single product or campaign behind that product. If you publish a post (and there are over a billion a day on Google+) related to your product and it catches the right eyes it will spread. Knowledge of your product will expand and the hits on both your Google+ business page and that products own page online will increase, potentially exponentially. Many users will be experiencing a Zero Moment of Truth, proof by a large body of their peers that the product is good, appreciated, interesting.

It’s impossible to emphasise the importance of this effect to you and your business but Google are helping with that one too. They’ve introduced a feature called Ripples, which allows business people, marketers and general speculators to view the effect a post had, a sort of butterfly effect on Google+. Your post flapped it’s wings here and then what? You can see where it spread, to which users, how it spread on from them and the impact it had on your site traffic.The ramifications of this type of awareness are astonishing, allowing marketers to tailor their posts to mimic their most effective campaigns.

The simplest way I can summarise is - get your business on Google+. There’s never any telling how a new service or product will pan out but Google+ has a lot to offer you right now and you shouldn’t miss out.

If you’d like to know more about the Zero Moment of Truth and how it really drives your customers then Google literally wrote the book on it, which is a free download in all the common eBook formats and can be found at www.zeromomentoftruth.com.

On the 22nd of September Facebook held its annual conference in San Francisco. Hundreds of developers on tenterhooks attended and Facebook fanatics around the world tuned in to hear Mark Zuckerberg’s big plans.

So was the event as much of an anti-climax as the launch of the non-existent iPhone5? What exactly was announced? And most importantly what does this mean for us as users and marketeers?

In summary there are four significant changes on Facebook:

Timelines
By now you’ve probably seen an example of the lovely new timeline. Big images and top stories from over the years brought to the surface for all to see. Great for those with a pretty history…not so great for those who thought their skeletons were firmly in the closet!

Smart Lists
Hot on the heels of Google+, Facebook will allow you to create lists of your friends….colleagues, family, close friends, enemies etc. This means you can share posts with specific lists only rather than sharing every status update with all 500 of your friends. It also means you can easily opt out of getting news updates from certain people.

Ticker
Like Smart Lists, the Ticker has already been launched and you will now see The Ticker in the right corner of your screen continuously feeding you real time updates of what your friends are up to –what they are liking, comments they are making etc. The main real estate of the page is now reserved for the big stuff - your friends’ posts, status updates, pictures etc.

Open Graph
Previously Facebook was about ‘Social Graph’ connecting people. Now it’s become ‘Open Graph’ connecting everything else. Rather than simply being able to ‘Like’ something, you can now share exactly what you are doing online - what you are ‘Reading’, ‘Listening to’, ‘Watching’ etc. And this is where it gets really interesting…

While Timelines are a significant change for users, nobody is really sure how, or indeed if, they are going to affect brands Pages. Facebook didn’t make any specific announcements around Pages but a spokesperson has said “we hope to make Pages more consistent with the new Timeline in the future.” This could suggest that brands need to start building up the history of their business on Facebook, giving them a richer timeline with information on heritage, growth and testimonials, supported by photos and videos. But although this will change how brands are presented on Facebook and hopefully mean more emotional connection and loyalty, it isn’t really going to affect how brands use Facebook or how users interact with them.

Smart lists and the Ticker are of more concern to brands. They allow users to filter what they see in both their main news feed and in the Ticker, which is great if you make the cut, but not so great if you don’t. No longer can a brand think “I’ve got 50,000 likes so I know my posts are appearing in 50,000 news feeds”. People are effectively filtering out brands and business from their Facebook experience. As quickly as Facebook gave us the ability to connect with 800,000,000 people, it’s making it just as easy for them to disconnect from us.

So what does that mean for marketeers? Well essentially this means that it’s more crucial than ever to stimulate and engage your Facebook fans - 1) to keep yourself interesting enough to make the shortlist and 2) to keep yourself visible in the both the Ticker and, more importantly, the news feed. Facebook describes the content for the Ticker as lightweight so you need to ensure that you are a heavyweight with valuable content, photos and videos for example. Since users now have more control over their news feeds, brands with boring or irrelevant updates will have lower visibility and the aim of the game is no longer to simply get your ‘Likes’ up.

Then this brings us on to the beast that is Open Graph or ‘frictionless sharing’ as MZ pitched it. Once you have ‘accepted’ a website it can now post details of your visit or consumption of its content onto Facebook automatically, without any prompt or acceptance. App developers can also define exactly how this interaction is reported – their users don’t have to just ‘Like’ their content they can now ‘Eat’, ‘Sleep’ and ‘Breathe’ it…..or whatever you want them to.

So, for example, you may have noticed in your new Ticker some handy updates like “John is listening to S Club 7 on Spotify”. So my questions are 1) does John want me to know he’s listening to S Club7 and 2) what are the implications of this next level of Big Brother surveillance?

There is some debate about how much Facebook is actually tracking you online. Some believe that every time you visit a webpage that displays the ‘Like’ button Facebook tracks that visit, whether or not you actually ‘Like’ the page. And now if you accept an App it will post this information to your wall, sharing the details about your visit. So for example, if I accepted the Guardian Facebook App (which got 198,000 users in 3 days after the Open Graph announcement!) because I was reading an interesting article I thought my friends might like and then the next week I went on and read an article about how to get rid of smelly feet, before I knew it all my Facebook friends would know I have smelly feet (totally hypothetical of course…)!

From a marketing perspective this opens up a whole new world of possibilities. Facebook is allowing your customers to publicise their interactions with your brand. It means deep personalisation with immense customer intelligence and the opportunity to amplify brand engagement. But it also means another ‘currency’ in which consumers are paying for content and services online. Rather than asking us to pay to watch videos, read articles etc., companies are going to start asking us to accept open graph. We allow them to find out everything about us, and promote their brand and in return they will grant us access to more content.

This is fine for companies whose products are consumed online, but isn’t it harder for everyone else? At the moment restaurants, bars etc. rely on check-ins for Facebook users to help spread the word, but check-ins are prompted not automatic based on online consumption. One would presume that this is the next step; soon we will automatically be checked-in to places without confirming that we want to. Therefore my main concern with this whole ‘frictionless sharing’ thing is… how am I supposed to pull a sickie when I’ve automatically been checked in at a bar at 3am...?!

It's the Third Thursday of the month... already!

Codegent Curry Club

Other links referenced...

• Bloomberg Square Mile Relay
• BBC Design Roster

This week the world’s favourite micro-blogging site Twitter announced that it’s crossed the 100 Million users mark. Quite an achievement for any online business and let us not forget that Twitter is a business. Their most recent round of venture capital funding will leave their value at 8 Billion dollars, but where’s the money coming from to justify that value?

Well as we all know, Twitter currently makes no money, it’s free to users and is a bottomless pit for the aforementioned funding. So what are the market speculators valuing at 8 Billion dollars? The site and all its posts? The technology behind the service itself? No, of course not. That myriad of information (purely narcissistic, or otherwise) although interesting is worth nothing, even the news reported on Twitter is usually a short version of what exists elsewhere in a much more readable form. Even the infrastructure itself over the years of R&D and redesign is probably worth somewhere from a few hundred thousand to a few million at the most (although the 24/7 running costs must be remarkable).

So what’s worth 8 Billion US Dollars to the many investors who keep Twitter running? You.
Quick calculation $8,000,000,000 ÷ 100,000,000 = $80

That’s pretty reasonable! Each user being worth $80 is a great deal, for it is you that they own. Unlike Facebook, to date Twitter seems to remain relatively unscathed in this regard. Facebook has come under plenty of fire for user privacy issues in the last 12 months. Mostly this is because Facebook is very clear that the user is their particular commodity, but people don’t like being seen this way. Facebook knows all about you, what you like, where you go, who you talk to.

Twitter is no different. It knows who you follow and therefore what you like. It knows who you tweet to and even where you are when you tweet. The reason it has escaped criticism is largely because it hasn’t taken advantage of this. Yet! But at some point the investors will want their $8 Billion back. Thus the conversation has been sparked, how long will it be until Twitter introduces advertising to their service?

On a wider level this has happened on similar services and successfully too. Google for example saturate you in advertising throughout all their services. They are so good at it though, the advertising itself is so subtle and so well targeted, that users rarely find it irritating. However, they achieve this in much the same way as Facebook, that being collection of personal data. Google know all about you, it’s just not as obvious as Facebook, who are recently the whipping boy for privacy issue gripes.

In fact, when Google bought out YouTube for close to $1.7 Billion in late 2006 they began the process of heavily commercialising the site. At first this resulted in the usual condemnation of any change but has been largely embraced and accepted by the sites users. And no doubt it’s this advertising that brings in the much needed running capital to ensure a site as complex as YouTube keeps going.

The fact is social media companies treat the user as a product, that’s just an underlying principle of online business. If you (the consumer) appear to be getting something for free, then you are the product. Overall, we have to recognise that this is a trend which is prevalent online now, the long game is king.

As members of this industry the strategy of these companies should be obvious to us, find a niche and populate that niche with great content for free. This will draw thousands, millions or even hundreds of millions of users to you. Once traction is that high, sell these users (or at least access to their prefrontal cortex’s) to the highest bidders.

Sounds horrific, doesn’t it but it’s actually not always a bad thing. The reason Facebook came under such scrutiny was their willingness to share user’s details with partners by default. If user’s have the ability to control what’s shared then bad press can be easily prevented, unfortunately Facebook learned this the hard way. That said, the other usage of our information by Facebook was internal, Facebook’s servers simply determined which, of their myriad of available adverts, were relevant to us. This actually works and personally I find it’s always showing me things I’m genuinely interested in. Google’s extensive algorithms seem to do much the same, with plenty of advertising, but all of it related to the searches I’ve made and hence, things I’m interested in.

We can only hope that lessons learned by others are taken into account when Twitter inevitably begins leveraging their huge user base for something more profitable. If adverts appear in my feeds which are relevant to me I should be happy, right? It’s a balance of course; most users accept that adverts are needed to support their favourite sites and services. This is still a learning period and both sides need to forge some tolerance. Users need to understand that who they are and what they like is up for grabs and online services need to understand there’s a limit to this, users will only tolerate being owned by their favourite service if that trust isn’t abused.

I’m recently new to Codegent but I’ve been working in London for a long time and there’s one thing that really grinds my gears lately. Not involving work, or home, or the digital world but rather all three, that being the bit in between, the journey to work.

Now I’m happy to admit that I’m a bit of slave to the digital world myself, I’ll agree that we’re in a new age of digital connectivity and therefore the easy access we have to the internet just about everywhere can greatly enhance our lives. Increasingly we can interact with the world in incredible ways through tiny devices we all carry in our pockets. I’m completely up for that by the way.

Just the other day I was out in London and spotted a lovely view of the Thames, which I snapped and popped onto Facebook, for my friends and family to enjoy, within a few seconds. While looking for a decent lunch in the West End recently I simply typed restaurants into my smart phone and saw every restaurant local to me. This was unheard of until recent years and is extraordinarily useful.

So these devices can enhance our interaction with the real world in a truly profound way, giving us information about the world, letting us record the world, even allowing us to enhance it. One thing I think people forget though is that they do live in the real world. I probably read my email and the news on my smart phone every morning and while sitting on the train this is easy. However, I then put my phone in my pocket and depart the train to walk to the office.

Some people though, have a very difficult time taking their eyes off the tiny screen that populates their vision. I’ve genuinely seen the train doors open and the person standing in front didn’t even move due to their smart phone induced stupor, causing what is popularly known as a Blackberry jam behind them.

People are texting and walking into the road obliviously, or into other people, or walking incredibly slowly down the pavement causing everyone behind them to move at a snail’s pace. I was just trying to get to work, I didn’t expect to be doing the conga through Wandsworth at 9am, I’d have dressed up a bit if only I’d known.

What I’m saying is, okay, great, we have cool smart phones. They can do some great things, brightening our experiences of the world and the way we interact with it. So if you’re wandering down the street browsing the net fair enough, the digital world is a vibrant addictive place. Just don’t do it in a very busy station, or while crossing the road, or piloting a shuttle mission or basically… in front of me. It just really grinds my gears!

Wow. Only a few months ago, Karine wrote an article about how for the first time social media had allowed people a taste of freedom during recent uprisings in places like Egypt and Libya. 

And here we are wondering whether social media is a menace as it appeared to be so central to the recent riots and looting in the UK. As David Cameron told the Commons:

“When people are using social media for violence we need to stop them”

As we all know, Twitter and Blackberry Messaging appears to have been widely used to organise and even incite groups of rioters firstly in London and then further afield to other cities in the UK. With this in mind, should the authorities somehow shut down access to these services if a similar thing happened again?

Is it practically possible to shut down ‘social media’?
Yes and no. In the UK it would be disastrous for the government to completely shut down all internet traffic because so much business now relies on it and frankly it would be ridiculous. So they would have to lean on ISPs and people like RIM who own Blackberry Messenger to block specific sites and applications. 

Is it right to do so?
It’s part of the human condition to want to explain things in a simple way. As designers and information architects, a lot of what we do is about organising content to make it easy for people to assimilate. Nobody has the time or inclination to go through a list of pages to work out which ones they might want to read, instead they rely on visual signposts and grouping of content. 

In explaining why so many (mainly) young people took to the streets, destroyed buildings and helped themselves to other’s property, the same thing applies. It’s variously been concluded that bits of society are simply “sick” or they are just greedy opportunists, or that the corruption shown by politicians has somehow given them a sense that if you can get away with it, then it’s OK. Others have said they were just bored or having a laugh or simply swept up in a tide of excitement fuelled by social media.

It’s all too easy to say that one thing is the problem and so much harder to say in a headline or a soundbite that lots of combinations of factors may have been at play. Which is partly why I think that shutting down “social media” however that is defined, would probably not have the desired effect and sets a dangerous precedent.

Put it this way, people have been rioting way before social media was invented. In 1985, during the Broadwater riots that culminated in a policeman being hacked to death, there was no pre-digital equivalent of Twitter that galvanized people into action. Social media may make the process easier and faster to disseminate, but it’s people, not technology, that starts riots.

And who is to say what constitutes civil disobedience.? Isn’t one man’s demonstration another man’s riot? The student marches earlier this year and the public sector workers one more recently, were by and large peaceful. But when one moron starts swinging from the Cenotaph or another lobs a fire extinguisher from a roof, should that trigger an instant shut-down of social media?

There’s another thing, too that goes back to the unrest in Egypt and Libya. When protestors were using social media to communicate with people, we in the democratic West were shaking our heads in horror that any government would be so scared of the will of the people that they would be prepared to shut down their right to communicate with each other online. We start shutting down social media in the UK, for whatever justification, we lose that moral high ground.

From the printing press to the internet, every time any advancement in communications is invented, the people tasked with ruling us get twitchy. They feel the need to control and restrict it. But I don’t think it’s down to the people we elect to decide how or with whom we communicate. Of course this makes things harder for the authorities, but so it should be: having the freedoms we enjoy have been hard-won and we shouldn’t give anyone who wants to take them from us an easy ride.

You have probably heard about the recent social media explosion surrounding Quora. There have been some pretty grandiose claims about how it could be "bigger than Twitter" and "the future of blogging" so I thought I would give you a closer look to see what all the fuss was about.

What is Quora?

"Quora is a continually improving collection of questions and answers created, edited, and organised by everyone who uses it." - their definition

• You ask a question and the community answers it. You can also subscribe to topics, answers or people that interest you.
• It utilises your existing connections via close ties with Twitter and facebook so you are more likely to start getting answers from people you're already engaged with.
• The best answers get voted up Digg style, the dross is pushed down so you iterate towards quality.
• Relevant content is collated into a facebook-like feed enabling new content to be brought to your attention (via notifications).
• It has a strong, intelligent search engine for easily finding topics and answers surrounding the question you might have.

So it's like a discussion forum then... wow!

Indeed! Plus Q&A sites are not exactly unique either so why has it carved out its space on the web and been so highly praised by the big players of Silicon Valley? The answer lies in building personal reputation. Aside from the pleasure of writing, bloggers generally publish in order to share their opinions, experiences and expertise so they can build an audience and ultimately become influential. However this can be at quite a considerable cost in terms of their time creating and marketing that content (ask me how I know!) and is rarely successful.

By engaging with Quora on topics that you have sound knowledge and opinion on you can build audience and influence much faster than before. A well constructed and timely answer will get voted up towards the top and therefore will be read (alongside links to your profile) by everyone following the topic. Invariably, you will pick up more followers and be inclined to write better quality answers to help increase your votes. It's this game mechanic that has really set Quora apart.

Ok, I'm liking this anything else cool?

Funny you should ask. The SEO benefits are actually astounding. Q&A sites are doing particularly well in natural search at the moment (as are video and real time social media content) as the space race for relevancy and fresh content continues between the major search engines. It is completely feasible that your post on Quora could top the search term for the topic whereas your own blog post would normally nestle somewhere on page 5. Now that is powerful, and it's already started happening.

The quality of the current conversations is really high, primarily because of the extremely engaged early adopter community who buys into the concept and is committed to producing good content. Additionally there is the chance of commencing discussions with the top people in each topic field. Thought leaders and CEOs such as AOL's former chairman Steve Case are talking openly with regular users on a level playing field (not from a lofty conference stage). This is your time to be seen and heard by the right people.

It is not to everyone's taste though!

It wouldn't be right if I didn't list a few faults would it?

• The site does spew out a lot of notification emails which can be a little annoying, especially during this massive growth period. Although do you remember how many invites you got to join facebook initially? However, it was enough to prompt one developer to create this spoof site.
• You are building your reputation on someone else's platform. No different to doing the same on Twitter, facebook, LinkedIn, MySpace etc. but Quora is still in its infancy and anything could happen. Maybe best not to shut down that blog just yet and possibly repost what you write on Quora there as well?
• As the platform expands into the mainstream there is a danger that it will dilute and get spammed causing the big guns that are currently engaged to get bored by mediocrity from the wider community of fools. Some people feel Twitter is moving this way and it certainly is the reason Yahoo! Answers is widely derided. In this case we could see questions outstripping answers. The community must continue to police Quora for quality but will they stay engaged?
• You can edit another person's question. This is a marmite feature and does feel reminiscent of the warring editors of Wikipedia battling for supremacy. Where reputation matters, big ego also lurks.

Do you use it Mark?

I must admit I did sign up pretty early (last summer) and just clicked about, followed a few of the geek guys I take note of on Twitter and pretty much left it there until the explosion around Christmas. I am following a few topics like "Getting your startup featured on TechCrunch" and "What's the best CMS to build a corporate website?" and the quality of answers are really high! It's undoubtedly a useful resource.

However I'm not addicted to riding on the sweet high of Quora as yet. That may be because I am not really trying to build my personal brand as much as I am for our agency. Quora is currently positioned around the individual although inevitably in the future it will open up for companies in much the same way facebook did. Brands are being mentioned right now so if you represent one I would start searching straight away and getting in on the conversations early.

You can follow me here if you like and please do tell me what you think of Quora in the comments below.

Facebook, Twitter, MySpace? They are all the most popular social media networks of the moment. But in the eyes of teenagers they have always existed… and to an extent that’s true. These networks for social interaction, which have the power to boost your business, are far from new.

A 50s Invention

It started illegally. One of the first social medias was “Phone Phreaking” which was born in the 50’s. I can’t imagine my grand parents using this early homemade electronic device called a “blue box”. You would plug it into a phone booth and hack landline systems to receive secret messages… awesome. This ancestor of Skype was the start of the movement.

But social media networks did not see any real progress until computers started to arrive in people’s homes. BBSs (Bulletin Board Systems) made the first steps in the 70’s by allowing users to log on and interact with one another. Have you heard of ICQ, the first instant messaging device? Or Prodigy, the discussion platform? Or 26000 Meetings, the first “tweetup” type social media events? I had no idea they existed but they really helped to amplify and expand the movement in the 90’s. Classmates.com proved instantly that the idea of a virtual reunion was a good one and in 2002 social networking really started to hit its stride with the launch of Friendster.

Why Social Media can improve your business

So Mark Zuckerberg (Facebook creator) didn’t invent anything after all, all he did was prove how much people like to talk about their experiences, their actualities, their lives. To keep in touch the world over and have a presence on the web by sharing.

There are now plenty of social media options for sharing almost everything: not just discussions, but also videos, images, ideas, passions for pets, shoes or trainspotting. They are all potential platforms to communicate on and create a marketing buzz according to your business. But why?

Social media raises the game to another level. Before, the information would go from a billboard to you, now, it goes from a billboard through you. People are becoming vectors but more precisely trusted vectors who will lead messages to a wider and like minded target. For example, I share the same interests of Matt, my Creative Director, about Design. Hence I follow his tweets, have a look at his blog when I have a minute, and watch his arty pictures through Instagram for inspiration. Now Matt saw a very interesting coffee place which presents temporary exhibitions. He liked the idea and decided to promote the place by sharing the information through his social media networks. All his contacts and friends will see it on his feeds (knowing Matt we are talking about hundreds of people). This information doesn’t come from a shiny brochure, it comes from a respected colleague and friend. Its importance is much higher. Now I have seen it, and inevitably like it too I have also decided to promote it through Twitter and Facebook. My own friends may like it and so on. Imagine how many people’s attention this little coffee place will command? Thousands.

This is why it appears crucial for you to have share buttons on your website. Twitter and Facebook can definitely make a strong difference to the traffic generated on your website. And whether you are creating a buzz for dance choregraphy or pumpkin carving, other social medias can be added such as Youtube or Flickr to amplify your weight on the web. Social media is an extraordinarily powerful medium and is set to remain the key call to action for your success.

WARNING: Do not abuse it

Now that you know how great social media is for your business, you will probably want to reach a maximum amount of people by pushing them to share your content through all possible social media networks. From the best known which has millions of users to the tiniest, which might have 20 members.

Quality must come before quantity. You won’t gain more impact by proposing 10 different social media sharing buttons on each of your webpages. The exact opposite will happen. Desperation is not appealing.

Recently I was talking with a friend who works for a business advisory company, specializing in social media. He kept saying that networks have to be strategically placed and be specifically linked to the company’s activity. Social media networks don’t all share the same functions and they do not operate in the same context: Facebook is mainly used by friends, Linkedin by professional contacts, Digg shares and rate links and is more about collective opinion… They can serve you and give you crediance if they are thoughtfully placed upon your webpage and carefuly selected depending on who the target audience is and how they engage online.

Finally, the wider world is slow. When I ask people what social media they know, I usually get Facebook, Twitter, Linkedin and Myspace. Web people will add Delicious, Tumblr and Digg. Fundamentally only some people use Tumblr and a few others Myspace but there are two ubiquitous presences: Facebook and Twitter. In coming years, others may get more and more important and gain critical mass on the Net, but for the moment their curves are low, and won’t bring you much of an audience.

Ever heard of Groupon?

If you haven’t you soon will. Groupon offers one discount coupon deal per day in cities around the world. The trick is that the deal only kicks in if enough people buy it. The site heavily utilises major social networks to help and incentivise bargain hunters to share the good news with their friends in the hope that the deal is triggered - "collective buying power".

Since launching in late 2008 it has taken off in the US and has inspired a large number of lookalike companies and campaigns in the space as well as creating a market for unredeemed coupon trades. Speculation has recently been mounting that a big number takeover bid from Yahoo, Google, Amazon or eBay is imminent.

The business is also growing internationally through acquisition and natural growth and recently ran its first nationwide campaign for Gap across America.

But was it successful or not?

The $11 million Gap day was timed to coincide with the back-to-school rush. 445,000 shoppers bought a $25 voucher for $50 worth of Gap clothing, a move that sparked a huge amount of buzz online (well, before they decided to muck about with their logo).

This buzz would have boosted Groupon’s subscriber base enormously as well as make them a decent amount of money, Groupon normally take 50% of the coupon price. However marketers are divided over the value of the campaign.

"All in favour say I"

The average purchase of a Gap customer once in the store is likely to be a lot higher than $50, especially around the back-to-school period when the majority of stock is at full-price.

The offer expires after 3 months. After that, Groupon buyers can exchange their voucher for a $25 gift card instead of the $50 credit. Those that do not redeem at all are simply lining the pockets of Groupon and Gap.

Gap may have negotiated a better split than the normal 50% due to the value they bring to Groupon in terms of new subscribers. Gap running on Groupon also enhances their image considerably and the word of mouth spread was highly effective. There is also a brand building element as users that don’t buy are still hearing about the business and its latest messaging.

Marketers have compared this multi-million dollar marketing spend to the effectiveness of a magazine or TV ad which instills less reason for the customer to come in through the door. A Groupon customer has already spent the money, valuable cash in the bank until the customer redeems it, and a far greater incentive to follow up.

"I just don’t buy it"

The economics don’t work for most businesses. It’s nearly impossible to make a profit when you are giving away 75% of the initial purchase (50% to the consumer and 25% to Groupon) unless your new customers return regularly. In effect the $11 million in revenue is also potentially $11 million in losses, not taking anyone else’s cut into account.

“Breakage” - the theory of a certain percentage of people forgetting to redeem is not a stable business model. Groupon also sends reminders to its users near the expiration date and remember the user has already purchased, they are likely to redeem!

It caters to the psychology of the bargain hunter who may have never had any intention of shopping at Gap except for this one offer. Arguably they are now only happy to shop at Gap at this value level and no higher. Assuming you need repeat purchases or large basket sizes for the campaign to make sense does this really target the right consumer mindset? Effectively this is a traffic buying exercise resulting in fickle new customers, loyal to deals, not the brand.

This is not the start of a beautiful relationship. Promotions are supposed to help you reach new audiences and develop rapport. In this case the giver of the discount is Groupon, not Gap. The loyalty is not really to the one suffering the margin shortfall.

You are at the mercy of the 50% off culture that has arisen on Groupon. Comparatively a 15% or 25% offer would look stingy but not every business has the same margins that they can afford to play with.

So should we do it?

I have put a stronger case for reasons not to commence a Social Coupon campaign because I think the reasons in favour are fairly obvious. A recent study from Rice University concluded that 66% of the 150 merchants interviewed found Groupon profitable, 32% making no money. In total 40% said they would not participate again.

So, like a proper History graduate I am going to say “Yes, Groupon is worth investigating, but…”
Here are a few tips:

• Do your numbers – there are a huge amount of financial factors to be considered when putting the case for Social Coupons forward. It’s not a straight forward algorithm and you need to be honest with yourself about the stickiness of your full price proposition.
• Quantity does not guarantee profit and in fact could even sink you! Be prepared with a bucket when Groupon turns the tap on - they don't cap the deal at x number of sales, build that into your equation.
• Make the execution of your offer watertight – this is going to cost you and the experience a new Groupon customer gets is crucial. Your entire client facing staff need to be up to speed on the deal and also well trained in upselling or ensuring repeat business.
• Make the terms of your Groupon deal totally clear to your customers - you want them coming back but not at a 50% loss to you each time.
• Beware that you can’t necessarily determine the day your Groupon runs. You need to be careful when negotiating it around a time of year that ideally suits your business. For example a gym would be targeting New Year when health and fitness is most on the mind.
• Groupon users are mostly young. 68% are aged 18 to 34 and they are particularly strong on certain demographic groups such as females. Make sure their audience overlaps with yours!

Some final thoughts on Social Shopping

Typically brands that gain the greatest purchase results through Social Media tend to go one of two ways - either through offering coupons or discounts, or by making noise during sales or special event periods. A survey by Morpace found that 37% of Facebook users joined fan pages for special offers.

eMarketer senior analyst Debra Aho Williamson says, "Coupons remain a leading driver of brand interactions in social networks. At the same time, they can be one of the trickiest social media tactics to pull off. The discount offer must print or download easily and must work as promised. And the retail store or distribution channel must be prepared for demand."

Is there a less scary way?

Maybe you should consider a location based promotion (like Starbucks and L’Oreal) or checkin discount instead? Gap did that as well! The penetration is not quite there yet but Facebook Places is going to change that. The quality of customer is higher and it oozes user evangelism, which is what you are ultimately after.

You can read more about it here. I’m off for some discount booze and food down my local pub.

My sporting year looks like the profile of the 20th stage of last year's Tour de France. Flat for the main part with a single majestic peak rising out of the relative flatness.

The Tour itself is the Mont Ventoux of my annual sporting calendar, a monolith event of such epic proportions that its shadow looms large over everything that precedes it.

Like most cyclists I am a details freak. I revel in cadence rates, riders' gear ratios and other banalities that would be bed-wettingly dull to most of you reading this. 15 years ago I would clear my daily calendar between 6pm and 7pm and drink up every scrap of information that the Channel 4 daily Tour highlights could give me but it was never enough to sate my thirst for these details from the Peloton.

Similarly, it would never convey the rider dynamics, the feuds and alliances, the sheer and brutal pain that each rider would endure as the Tour wound its inexorable way towards Paris.

Then came the Social Web.

What social media gives cycling is the means of giving detail-obsessed fans like me an instant hit of the tedious, granular information that I crave. It lets me see Cav's cadence as he rips up the Champs Elysees or Brad Wiggins' heart rate as he goes backwards down the Col de Madeleine.

I can go to my 'Pro Cycling' group on Tweetdeck and see petty squabbles between riders unable to resist the lure of Twitter whilst holed up in a Novotel with nothing but a sponsor's smartphone and a travel kettle for company. Or the Peloton's praise for someone's superhuman feats, such as riding 200km with a broken arm. I can go to Flickr for Hi Resolution images of the day's suffering or stream the race live on my iPhone through the ITV Tour App. In short, there is so much for me to see and do that I am almost certain to do no work for most of July.

A few Tour-based treats for the other bike geeks out there;

1. Keen to show off its capabilities, Microsoft have built an App for Bing Maps that visualises each stage of the tour and provides stage results and weather information. http://mashable.com/2010/07/03/2010-tour-de-france/
   
   
2. Mapmyride have created an App that allows you to 'virtually race' the Tour by uploading data about your own day's ride. The app uses your stats to create a virtual time that you would have achieved if you had actually ridden that day's stage. I havent used it but i imagine it might be quite depressing. http://beta.mapmyride.com/tdf/
   
   
3. This is one for real data lovers. HTC (the smartphone guys) and Team Columbia have joined forces to bring the ultimate cycling Google maps mashup. The App gives realtime information on the Team's riders including speed, power, cadence and heart rate, as well as their real time position on the road. http://www.google.com/intl/en/landing/mytrackstour/
    
4. The ITV iPhone App lets you watch live streams of the Tour on the go as well as providing news and stats around each stage, team and rider. http://www.itv.com/sport/tourdefrance/iphoneapp/
    
5. Stalk your favourite riders on Twitter. http://twittercycling.tumblr.com/