Leveraging Social Media
Module 5
Leveraging Social Media for Business
Social media strategy has evolved from simple broadcasting to creating brand communities and leveraging integrated media. The core focus is not just on paid channels but on building Earned Media through engagement and community participation.
| Component | Focus | Goal |
|---|---|---|
| Brand Community | Creating a space for customers to interact with the brand and each other. | Foster loyalty and advocacy. |
| Integrated Media | Combining Paid, Owned, and Earned media. | Create a seamless customer experience. |
| Earned Media | Principles gleaned from research on organic reach. | Amplify the brand message through user advocacy. |
The Customer Engagement Funnel
Social media strategy must be aligned with the customer engagement funnel. It is not sufficient to just have a presence; the presence must drive specific business objectives at each stage.
Stages of the Engagement Funnel:
- Awareness: Introducing the brand to potential customers.
- Consideration: Providing information to help customers evaluate the brand.
- Conversion: Driving the final purchase decision.
Strategic Shift: Traditionally, businesses focused on cost and distribution. In the social age, the focus shifts to Brand Equity and Trust. As businesses scale, maintaining trust becomes harder, and social media serves as a tool to bridge this gap by humanizing the brand and enabling direct interaction.
Doing Business the Social Way: Community Building
Successful social media strategies often involve creating communities based on shared interests rather than just the product itself.
Case Study: Fiskars (Fiskateers) Fiskars, a company known for orange-handled scissors, faced a commoditized market.
- Strategy: They created a community called "Fiskateers" (a play on Musketeers).
- Concept: A community for scrapbooking enthusiasts (their core demographic) rather than just a "scissor fan club."
- Outcome: By focusing on the passion (scrapbooking) rather than the product (scissors), they built a highly engaged community that evangelized the brand.
Business Strategy in the Age of Platforms
Digital transformation has enabled new business models that rely on platforms and network effects.
The Razor Blade Strategy vs. Platform Models
- Razor Blade Strategy: Selling a base product cheaply (razor) to sell high-margin consumables (blades).
- Digital Complement Strategy: Enhancing a physical product with digital services.
Case Study: Peloton Peloton exemplifies the integration of hardware and digital platforms.
- Product: High-quality exercise bike.
- Digital Layer: A subscription service for live and on-demand classes.
- Result: The digital component tracks performance and connects users, creating Network Effects. The product becomes more valuable as more people join the platform, unlike a standalone exercise bike.
Case Study: Yelp A prime example of a review-based platform model that leveraged User-Generated Content (UGC) to build immense value without creating the core service itself.
Social Strategy vs. Digital Strategy
While often used interchangeably, there is a distinction between broad digital strategy and specific social strategy. Social strategy focuses heavily on human interactions and "extroverted" brand behaviors - being comfortable meeting strangers and engaging in conversations, whereas digital strategy encompasses the broader technological infrastructure and channels.
Social Media Advertising Mechanics (Facebook Example)
Modern social platforms like Facebook offer sophisticated targeting capabilities that go beyond basic demographics.
Key Targeting Mechanisms:
| Mechanism | Description | Use Case |
|---|---|---|
| Custom Audiences | Uploading a list of existing customer contacts (emails/phone numbers) to the platform. | Retargeting existing customers or upselling. |
| Exclusion Lists | Using the uploaded list to exclude current customers from a campaign. | User acquisition campaigns (don't waste money showing "Join Now" ads to existing members). |
| Lookalike Audiences | Algorithms find new users who share similar characteristics to your best existing customers. | Scaling customer acquisition efficiently. |
Measuring ROI and Attribution
Measuring the return on investment (ROI) in social media is complex due to attribution challenges.
The Attribution Problem
- Last Click Bias: Standard analytics often give 100% credit to the last touchpoint before conversion (e.g., a search ad).
- The Reality: Social media often plays a key role in the middle of the funnel (Consideration/Engagement) but may not be the final click.
- Risk: If you allocate resources solely based on Last Click attribution, you may underfund social media, cutting off the supply of new prospects entering the top of the funnel.
Metrics Evolution
| Metric Type | Examples | Strategic Focus |
|---|---|---|
| Traditional | Sales volume, Cost per unit, Distribution coverage. | Transactional efficiency. |
| Social/Digital | Engagement, Sentiment, Negative Value Actions (NVA) (e.g., complaints). | Balancing High Value Actions (HVA) with cost of NVA. |
Ultra-Quick Revision (Exam Essentials)
Key Concepts & Distinctions
| Concept A | Concept B | Key Distinction |
|---|---|---|
| Razor Blade Model | Platform Model | Razor Blade relies on selling consumables (blades) for a base product; Platform relies on connecting users and creating network effects (e.g., Peloton). |
| Inclusion Targeting | Exclusion Targeting | Inclusion targets specific users (e.g., existing customers); Exclusion removes them to ensure ad spend is only used on new prospects. |
| Last Click Attribution | Multi-Touch Attribution | Last Click credits only the final touchpoint; Multi-Touch credits the entire journey, acknowledging the role of social media in awareness/engagement. |
| Fiskateers | Fiskars Products | The Fiskateers was a community based on shared passion (scrapbooking); Fiskars was the brand manufacturing the tool (scissors). |
Must-Know Terms
- Network Effects: A phenomenon where a product or service becomes more valuable to its users as more people use it.
- Earned Media: Publicity gained through promotional efforts other than paid media advertising, often generated by a loyal community.
- Custom Audiences: A targeting option that lets you find your existing audiences among people who are on Facebook by uploading customer lists.
- Brand Equity: The commercial value that derives from consumer perception of the brand name of a particular product or service.
- Lookalike Audience: A way to reach new people who are likely to be interested in your business because they're similar to your best existing customers.