Series: Social Media ROI «

Will Social Media Change Banking?

by Jay Deragon on 05/26/2010

This entry is part 20 of 20 in the series Social Media ROI

The banking industry needs to transform itself from a transactional business model to an engagement model.

Banks make money on our deposits, our transactions and lending us money. The economic models for banks are old and subsequently there is little differential from one bank to another. The customer experience is largely the same and yet bank after bank uses the tag line “relationship banking.” Bank relations do matter just like any organization selling products and services but the dynamics of relationships are changing and so must the banking industry.

Think about the image we have of banks: a brick building we rarely go into with people behind a counter and the manager sitting in an office with plush furniture. What do these people do? They manage relationships, transactions and the more they manage the more they make.

What Would a “Social Bank” Do?

If banks would take advantage of social technology they could in fact create a “new system” that fueled transactions. Banks could set up a “social network” exclusively for banking customers to create profiles about who they are and what they do as well as a listing of their products and services. Banks could establish a “community” for customers to integrate their social media which would create a “digital marketplace” of conversations. The conversations could be tagged and categorized by interest and customers could find answers to common business questions. Answers to these questions represent a “marketplace” which in the end creates an exchange of value requiring more transactions.

Will Banks Leverage Social Media?

The Financial Institution’s Guide to Social Media”.

A Must See Webinar Series for Financial Services Marketers.

Thinking about a social media strategy, but aren’t sure where to start, and then how to proceed?

Do you wonder how banks that are using social media feel about its value, risks and ROI?
Would you like to have a clear set of procedures to get through the regulatory and compliance issues that might be holding your financial institution back from social media participation, or, from taking it to the next level?

Would you like to see examples from some of the top financial services institutions in the country, who are using social media to their advantage?

Have you wondered how to stay on top of the many social media conversations that are about you and/or your competitors?

These are just a few of the many critical issues that will be addressed in a series of webinars sponsored by Financial Publishing Services, Inc.. Chances are; this is the most important webinar should attend all year.

We’ve pulled together the finest in the fields of social media consulting, compliance, and monitoring, all specific to the unique perspective of financial institutions.

Here’s the line-up:
June 1, 1 p.m-2 p.m. EDT

Getting started: the who, what, where, how and why of social media.
Jay Deragon
Social Media Strategist, Social Media Directions, Specializing in the financial sector

June 8, 10 a.m.-11 a.m. EDT

What’s working in social media for financial institutions? What pitfalls to be aware of, and how to overcome them.

Brett King
Author of BANK 2.0, CEO, User Strategy. Board of Governors at the
International Academy of Financial Management.

June 17, 10 a.m.- 11 a.m. EDT
Financial services social media monitoring; staying on top of social media conversations.

Christophe Langlois
CEO, Visible-Banking.com. Helping Financial Institutions worldwide to better UNDERSTAND and LEVERAGE social media.
June 22, 1 p.m. EDT
Working through regulatory and compliance issues on social media.

Sharon Blanchette
CPA, CIA, MBA, Asst. Director, ICS Compliance

Host and moderator, sessions 1-4
Why content is the glue of an effective social media strategy.
Christine Durkin
Director of Content-Marketing, Financial Publishing Services

Schedule conflict? No problem. Each session will be available for on-demand viewing at your convenience. Reserve your seat today, here

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The Currency of FaceBook Communities

by Jay Deragon on 04/30/2010

This entry is part 19 of 20 in the series Social Media ROI

It is interesting and insightful to see how “all things social” are changing the process of business planning.

Business planning requires proper assessment of internal and external factors that influence business outcomes. Given the power of all things social both of these factors are changing faster than the traditional business planning process. The significance is that “social factors” are far reaching and require non-traditional knowledge of emerging business landscapes and all the factors that effect the process.

Dan Robles writes: Few people realize the significance of the emerging trend we call “Local Social”. As we learned from the emergence of Broadband technology, the “last mile” will be the final piece of the puzzle to scalability, integration, and monetization.

When Social Media becomes a tool that allows communities to organize, everything will change with a new generation of business plans with which we’ll deliver everything from education to advertising. Engagement Marketing is becoming serious business. These new business plans will integrate social media directly as a means of empowering communities.

On another increasingly related front, community currencies are on the rise. They still suffer from adoption issues and accusations of protectionism – but they are on the rise. Look for correlations between community currencies, Social Community Organization and the slow steady evaporation of government currencies.

The fine Folks at Strategis Advisers provided the following cheery analysis of the world emerging around them. Keep in mind that Strategis is articulating what a real community sounds like. Real implication for the sensitivities of real people. Don’t expect this to sound like “Bernanke speak” any time soon, because it isn’t and that’s the point:

By Strategis Advisers

In addition to the page and the group page, Facebook now has community pages.

This function will separate the brands and businesses from pages like MY SISTER SAID IF I GET ONE MILLION FANS SHE WILL NAME HER BABY MEGATRON, and I hate it when I flex and my shirt rips.

If the community page gets thousands of fans/members, it’ll turn into a wiki that is managed by members of that community.

Also from Facebook this week, you will soon “like” brands rather than be a “fan” of them. Mashable explains here. This is a band-aid to the problem created when i would like information from The Official Days of Our Lives Page , but I don’t want my friends to think I’m a fan . I’ve got an image to maintain, ya know.

It would seem that all currencies have an Image to maintain.

Planning for Business as Unusual

When business factors change it means that the subsequent expected results will change. Not understanding the factors and the relevant impact of change means you will not be able to predict the results. Not being able to predict results means that your planning process is not grounded in the realities of your market. The market is changing and the factors driving those changes are new. Something new requires new knowledge in order to properly plan for it.

Social currency and communities are the new force of business as unusual. The currency of communities is fueled, created and exchanged by the human network. That network is much different than the traditional business network that thinks currency is an economic transaction created by tricks of the trade. The new currency is defined by social interaction between humans whose intent is not inclined to fall for “tricks of the historical trade” which drove previous economic transactions.

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Can We Accelerate A New Economy?

by Jay Deragon on 03/27/2010

This entry is part 18 of 20 in the series Social Media ROI

The USA is in economic denial. You simply cannot spend more than you take in unless what you spend increases productivity. As we accelerate the debt with “bail out” initiatives none of the efforts is doing anything to fuel productivity.

If you spend money that isn’t creating new value well then all you are doing is piling up debt that has to be repaid. If you can’t repay debt then you and your country are bankrupt. Being bankrupt means you start over creating a new economy, individually and collectively.

What Will Fuel The New Economy?

Dan Robles writes: The Next Economic Paradigm is a very simple idea yet the overwhelming majority of people have absolutely no idea what we’re talking about. The strangest part of this work is the knowledge that eventually this will become completely obvious to everyone and the transformation, from beginning to end, will take a very short period of time.

My greatest curiosity is imagining when and how this moment will arrive.

I recently saw the latest Star Trek re-boot where an old Dr. Spock encountered the exiled young Space Propulsions Engineer named Montgomery Scott who had been convicted of attempting a mash-up between warp drive and atomic particle transporting with the commander’s pet schnauzer – where the term “mash-up” was implied to be quite literal.

Um,…the dog wags the tail.

The epiphany came when the older Spock suggested that Scotty’s approach was backward. Instead of assuming that Space was stationary and the spacecraft was moving, Scotty should assume that the Space is moving and the spacecraft is stationary.

In one fell swoop, all the calculations finally made sense. A good theory became practical. All those nasty side effects – like bringing the schnauzer atoms back together – were no longer a problem. Lo and behold, the Federation was saved.

Of course everyone knows what warp drive is and what transporters do, yet the science involved with their actual construction of these devices remains intensely complex. The same can be said for our financial system. Everyone knows how to buy a can of tuna fish, but the actual formulation of that transaction is intensely complex.

We have developed a vast set of processes, techniques, and infrastructure around the basic idea that markets are dynamic. Everyone knows that markets change and move and they behave in many strange ways in response to price inputs, scarcity, surplus, legislation and ideology.

Meanwhile, people are defined by what they consume – like red dots and blue dots on a political district chart, demographic data points, owner/renter, winner/loser, jobbed /not jobbed, young /old, first class/coach, etc.

And that is just the way it is … and the only way it can be.

Now suppose Dr. Spock was to beam down and suggest that markets are static and people are dynamic. Imagine everyone staring at the can of tuna just sitting there, lonely, dusty and static, doing absolutely nothing except being a can of tuna on a stationary shelf, in an inanimate “market”.

The epiphany is that human knowledge assets are completely and irrevocably tangible in every way, shape, and form. Humans allocate and trade social capital, creative capital, and intellectual capital with each other in infinite ways, sometimes resulting in a can of tuna in a market.

All knowledge assets are tangible in the right exchange system.

I wonder what they will call it?

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A 4 Square Economy?

by Dan Robles on 03/20/2010

This entry is part 17 of 20 in the series Social Media ROI

The Next Economic Paradigm is arriving and the first entries include Foursquare. Few people understand the significance of this new class of social media applications. Foursquare contains many (but not yet all) of the components of the Innovation Economy that we have been discussing for several years at Ingenesist.com, Conversationalcurreny.com, and Relationship-economy.com.

Here is what Foursquare does have:

Geolocation: Sure, social media has been great sport for chatting with your buddies across the world, but nothing really happens until the rubber meets the road. people need to be in the same location in order to “build something” together. We call this The Last Mile of Social Media

Mayor of Popcorn: As silly as this may sound, badging it is a highly sophisticated feature that we have called the “ knowledge Inventory“. In order to build anything, there must be an inventory of parts. “Knowledge” is not the exception as the crude and archaic resume system would have people believe.

Knowledge is an asset and it will perform as an asset if it is characterized in the form of a quantity and a quality. “Mayor of Popcorn”, believe it or not, is in the correct form.

Vetting Mechanism: Vendors are an equal part of the social network and will soon provide their coupons, specials, and other economic incentives on Foursquare because advertising any other way is dead meat. Vendors will live in a system that is in their best interest to practice high integrity rather than low integrity while favoring mom and pop operations that live in the community. We call this “Social Vetting” as it lives beyond law and government – let the market be the judge.

Here is what they do not have (yet): Currency

The attraction of foursquare is the promise of fun and fancy crowd play. The incentive is to be seen as connected, mobile, and plugged-in. As such, people will be implicitly attracted to you like bees to a flower. In actuality, this game takes Social Media right to the edge of becoming a new financial system that can compete with, and challenge, the almighty dollar. No kidding.

Remember that currency is a social agreement. History shows that people will trade seashells, tulip bulbs, paper notes, and little copper disks as a device to store and exchange value. All value is expressed in terms of human incentives of some kind. Well here we have it. Now let the entrepreneurs play.

That is a huge, huge, huge matter.

The dollar represents productivity….well, so does Foursquare. What will entrepreneurs do in this environment? How will entrepreneurs organize communities around “things-o-do” – or even – “things-that-must-be done”?

Here is the hint. The idea that innovation is the exclusive domain of corporations, academia, or government is now as obsolete as Twitter. Innovation is now related to knowledge as knowledge is related to information. Anything that increases the rate of change of knowledge in a community can now be defined as innovation in Foursquare.

Debt and innovation represent the exact same thing.

Innovation is a promise of future productivity. Debt is also a promise of future productivity. It is only a matter of time that all of the activity in this new generation of social media applications will resolve to, and aggregate around, a new form of currency that will compete with the dollar itself. Mark these words.

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There Is No ROI From Social Media!

by Jay Deragon on 01/30/2010

This entry is part 1 of 20 in the series Social Media ROI

There is lots of chatter on the web relative to the ROI from social media. As we start a new year more and more people and organizations will become consumed by defining the ROI.

The Rising Tide of Expectations

People and businesses don’t like spending time and money without defining the return on their efforts. At the same time people and businesses engage in non-productive activities without even considering an ROI on those activities. So one must ask why do they think social media activities will produce an ROI? The reason is that social media has become in vogue and everyone seems to want to capture value from it rather than with it.

Now Social Media ROI is in Demand Connie Bensen predicts for following trends for 2010 as it relates to this ambiguous thing called social media ROI.

Companies will expect ROI from their Social Media efforts.
The Social Media Specialist (Community Manager) position will become mainstream.
Cultural shift inside of companies.
Social Media Monitoring will be a necessary component
Agencies and companies will hire data analysts
Integration of platforms and processes will be critical.

Connie’s predictions are sound and the market activity in 2010 will likely follow form. I have my own take on social media ROI. My take is there is no ROI from social media. Watch the video below and give us your thoughts.

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Chasing Social Media Results?

by Jay Deragon on 01/07/2010

This entry is part 16 of 20 in the series Social Media ROI

As 2010 begins a new year it seems that the marketplace is consumed with measuring the return on investment from social media activities. The demand for measurement of ROI will distract the marketplace from learning new methods to create ROI or it will create new leaders who focus on the “intent” which produces an ROI.

In an article in Mediapost titled 2010: The Year Social Marketing Gets Serious Laurie Sullivan writes: “Marketers will need to start justifying social marketing plans with business cases, objectives and metrics, as the medium moves out of the test phase.”

“Forrester Research released a list Monday of social computing prediction for 2010. The report suggests that companies that create social councils — cross-functional teams aimed at sharing ideas about social media — will begin to get serious about budgets and structure for these groups. Expect the teams to become strategists. Efforts will likely include policies.”

“The report also suggests that an increasing number of marketers will adopt listening platforms to monitor social media, Twitter will become more profitable or get acquired, Facebook will take a hands-on approach to protecting members, and incompatible mobile devices in siloed application will shatter the social experience.”

“Forrester Analyst Augie Ray says in 2010, those who hold the purse strings for budgets will want to see results. “It’s the year social marketing gets serious,” he says.”

Input+Process+Output=Results

Engaging in the marketplace of conversations has become main stream, expected and simply the new method of how markets should operate. Since the process is still new many are trying to apply old methods and old thinking with the ability to engage with many for difference purposes. Markets are now trying to measure the benefit of engagement and screaming for an ROI on the investment of time and expense.

The irony of current behaviors is that the intent is transparent. Marketers want to produce results from us and don’t realize how transparent their intent is to the new marketplace. Intent is the real measurement of effective engagement and the measure of intent is reflected by how well you serve the market of interest.

The focus and demand on results is akin to playing tennis by watching the scoreboard. Demanding measures for results is typical of old management thinking without taking the time to understand that which creates the results. Being consumed with marketing elements of social technology is silo thinking. Unless any organization learns to “connect” communications and understand the issues that impact the sentiment of communications then all “intents” to create a result will be misguided.

The banking industry chased results. They got the short term result only to create an collapse of our entire economic system then they had to be rescued by we the tax payer. The irony is that using “social media” to create results is reasonable but using it wrong may created the wrong result. Wrong results and measuring the wrong thing will create long term rejection with no rescue.

Input into communication processes creates output which leads to a result. Social media input represents thinking about the intentions of the marketplace you want to reach and serve. The intentions of the marketplace may be and usually are different than the intentions of the supplier. To influence end results means suppliers need to match their intentions with that of the buyer. Notice that buyers typically do not market anything rather they express wants, needs and desires reflected within their conversations.

Try measuring the ROI of your intent. Maybe 2010 ought to be focused on serious thinking about intent. Chasing implies you are not leading. Lead and you can influence others to follow.

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Are You One of the Crazy Ones?

by Jay Deragon on 12/30/2009

This entry is part 15 of 20 in the series Social Media ROI

Some people think there is nothing to this thing called “social media“. Then there are those who think it means everything.

How we view things shapes our perspectives and subsequent actions we apply to life, business and relationships. Our actions can create change or resistance to change. Change is created from communications. As a man speaks so shall it be….that is if enough people speak and think the same thing.

Social Media Conversations

Everyone, at least those paying attention, seems to be talking about social media and some are doing more than talking about it. Conversations about social media a fueling debate, stirring possibilities and changing how people think. When people change how and what they think they are enabled to see things differently. Subsequently when we can see things differently we are enabled to share what we see with others and collaborate around possibilities. The possibilities of social media and its impact on how markets behave and people interact will fuel even more change…..stay tuned for “The Intention Economy”.

Some people think believing in something as simple as communications is crazy. While others begin to think about how communications can change everything and they create the crazy things others don’t believe in……at the click of a mouse.

Do you think you can create unheard of results from and with social media? Some say yes and some say no. In a group discussion on Linkedin titled “Social Media for Business is Crap” over 900 people responded with their perspectives (a record for Linkedin). Subsequently a group under that name on Linkedin was formed. Which perspective would you consider crazy?

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Is ROI Input, Process Or Output?

by Jay Deragon on 11/05/2009

This entry is part 4 of 20 in the series Social Media ROI

It seems that online and off line conversations are consumed with measuring the ROI from social media. Much of the dialog is a waste of time and focused on the wrong thing. Yet organizations seem to be demanding a measure of ROI from this thing we all call social media.

All businesses represent a system of inputs, processes and outputs. Most businesses measure output, or results and said measures are purely financial results. The irony is that results do not tell you what may be wrong with the process or the inputs into a process. Results just tell you what you’ve produced as a result of the inputs and processes you’ve used. Social media does produce results but all those results can tell you is whether your inputs and processes were operating effectively. To change the result you must focus on both the inputs and the processes. But who measures those? Not many if any.

A Problem With Thinking About ROI

If you use existing social media metrics most of them will tell you about the reach of your message and its popularity with the market of followers. Reach and popularity may not be the right measure of effectiveness and efficiency. Getting reach is easy thanks to the power of social technology. Popularity only equates to well being popular. The question is are you popular with the right audience whom has an interest in your conversations or an interest in a relationship. Relationships beget opportunities for a transaction if the basis of a conversation has an affinity to the markets needs and wants. Getting lots of followers, connections and massive reach could create results that are meaningless. Yet many organizations measure these results (outputs) and use them to justify their presence, their efforts and the time and money spent doing so. It is a lot like the days of measuring advertising and marketing effectiveness which was justified by a 3% or less response.

So How Do You Measure ROI?

If you understand systemic thinking you know that all results are produced by the quality of your input and related processes. For social media the input is reflected by your thinking. The process is distribution of communications. Fundamentally it is that simply and should be looked at simply. On the other hand the input is what you communicate to whom, where, when, how and why. Now those elements of social media aren’t so simple and if they were everyone would be applying the thinking behind each element and creating massive ROI, which they are not.

The questions of what,where, when, how and why are deep and wide and require critical thinking. Critical thinking is purposeful and reflective judgment about what to believe or what to do[1] in response to observations, experience, verbal or written expressions, or arguments. Critical thinking might involve determining the meaning and significance of what is observed or expressed. It seems that today most organizations are chasing social media ROI without even considering whether there is adequate justification to accept the conclusion as true. Subsequently everyone is consumed with measuring the results without thinking through the inputs and processes that produce results that can go beyond your expectations.

Unless you think critically about the ROI from social media your thinking is not likely to produce any results. Thinking is the input, communications is the process and well the results reflect the quality of your thinking. The quality of your thinking is reflected by what you know or don’t know.

The web requires a new knowledge domain that most businesses do not have. Knowledge about what? If people are looking for solutions will they find you? When they find you will your web site reflect conversations that enhance relationship? Does your content engage and provide value? The market will decide that is less then ten seconds. Get it?

What say you?

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Why You Shouldn’t Use Social Media

by Jay Deragon on 11/04/2009

This entry is part 2 of 20 in the series Social Media ROI

Using social media just because everyone else is does not mean you should, at least not yet.

Before jumping into all the chatter and all the advertising organizations would be better served by asking themselves a series of questions. Finding the answers to the questions will require you to “think” about critical issues which will have serious impacts on the use of social media.

First you need to understand what it should be used for vs. what it shouldn’t be used for. To answer these questions you must think about how effective are your current communications, internally and externally. Why? Because communications is the essence of an economy, your economy, and unless you master it you will indeed hurt your economy.

Think About Your Communications

Kevin Kelly writes Because communication–which in the end…… is what the digital technology and media are all about — is not just a sector of the economy. Communication is the economy.

This vanguard is not about computers. Computers are over. Most of the consequences that we can expect from computers as stand-alone machines have already happened. They have sped up our lives, and made managing words, numbers, and pixels quite extraordinary, but they have not had much more effect beyond that.

The new economy is about communication, deep and wide. All the transformations suggested in this book stem from the fundamental way we are revolutionizing communications. Communication is the foundation of society, of our culture, of our humanity, of our own individual identity, and of all economic systems. This is why networks are such a big deal. Communication is so close to culture and society itself that the effects of technologizing it are beyond the scale of a mere industrial-sector cycle. Communication, and its ally computers, is a special case in economic history. Not because it happens to be the fashionable leading business sector of our day, but because its cultural, technological, and conceptual impacts reverberate at the root of our lives.

Results Are Fueled By Communications

The blogosphere is filled with commentary on how to get an ROI from social media. There are dozens of tools to use in measuring your social media campaign and its effectiveness. However measuring the output of social media is like playing tennis by watching the scoreboard, you will loose the game.

Social media is a way to communicate. Unless you know how to communicate in relational terms rather than marketing and advertising terms your result will be failure, wide open and transparent for everyone to witness. Learning to communicate in relational terms goes against everything most people have learned in business. Subsequently before using social media organizations must unlearn and rethink everything they previously learned and thought about relative to communications and market relations.

Using social media effectively demands mind-sets and capabilities that are unfamiliar and sometimes even counter intuitive to many business managers. It requires building trusting relations with your market, internal and external, rather than enforcing top-down out dated policies. Business managers should allow themselves and the entire organization time to unlearn and rethink everything before they “jumping into” social media. Most are following those who haven’t unlearned and rethought how, where, when,who, why and what they communicate which ultimately produces results, good bad and indifferent.

Results are the end result of how well and what people and processes communicate. You shouldn’t use social media until you know how well and what your people and processes communicate to all markets, internally and externally. Using it without knowing this is like jumping out of a plane with no parachute. Splat!

What say you?

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You Want Results?

by Jay Deragon on 09/09/2009

This entry is part 3 of 20 in the series Social Media ROI

A manager tells the workers “People, we need results from all this social stuff,not excuses. This business operates on cash flow, profits and capital. Unless you produce the results the business can’t operate. Now go get the results from social media we need”.

Maybe you haven’t heard it in those specific words but you’ve heard it proclaimed in most every business you’ve been employed by. Every business needs results but what most businesses don’t realize is what produces the results. Telling people to get results doesn’t produce results. Talking about the need for results doesn’t produce results. Pushing people to create results will create false results because people feel the pressure of giving you results. Pressured for results people will take the short road and produce the result but the result doesn’t last.

What Results Do You Want?

Individuals and businesses expect to get results from social media. Results are typically defined as a sale. However for some marketers the first result they seek is an audience. Get a “false audience” on Twitter, Facebook, Linkedin or any social network isn’t difficult. What you get from a false audience is not results rather it is nothing more than numbers.

Gaining sales from any business is about building, sharing and sustaining value. Value in the forms of products or services and value in the form of relationships. Selling products and services is about selling value that fills a need at a price that reflects the value delivered.

Relationships are built on providing value in a relationship and the equity of the relationship built reflects the price of the capital required to establish and maintain the relationship. Relationship equity equates to trust because your actions, deeds, products and services that create value both expected and unexpected. Expected value is the foundation of the relationship. Unexpected value is the pillars that build stronger relationships.

The Results Of Social Media

Everyone seems to be looking for the secrets to gaining results from and with social media. Social Media results are conversational. When people and brands “push” their message with the aim of trapping people the result is mostly a rejection. When people push out pornography or scams and schemes aimed at tricking an audience the result is “unfollow“.

The results of social media rest in the hearts and minds of people who have rejected mass media and are now rejecting anti-social media. So to answer the question as to “are there results from social media” the answer is yes. The results are the results of human interaction aimed at sharing, learning and helping others. These results have been and will always be what drives the hearts and minds of decent people.

If people, brands and institutions want to maximize the results of social media then they first must understand human vs. institutional value drivers.

You want results? Then simply do the right things and do them right. By the way that requires you to think in human terms rather than marketing and advertising terms. Our thinking is influenced by 40, 30, 20, ten or less years of producing the same old result. You can’t force conversational currency all you can do is nurture it. A change in thinking is first required before you can change a result. That may take some time.

Get it? Watch the presentation below

What Say You?

Olivier Blanchard Basics Of Social Media Roi

View more presentations from Olivier Blanchard.

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