Chapter 14
Building Blocks
The Elements of Social Business
Throughout this book, we have presented numerous stories of companies that have achieved outcomes that improved business performance by one measure or another. Each story focused on a certain capability of the business, such as marketing or customer care, and explored how social business approaches drove better business results. Along the way, we have set out certain tenets as root causes of the results these businesses achieved. To activate these tenets, social business design applies specific techniques and technologies to achieve desired alignment with downstream goals.
The palette of elements available to a social business strategist or designer needs definition. What approaches and tools can be brought to bear, and what are their known benefits, strengths, and weaknesses? Consumer and enterprise social media have become a vast panoply of services, platforms, technologies, standards, and tools. There are hundreds of consumer social networks and thousands of software tools and services, with options like hosted and on premises and open source or commercial. Market leaders can change with often dramatic alacrity. For example, one of the first mainstream social networks was MySpace, launched in 2003, but it was dominant for only a short period and was overtaken definitively by Facebook in April 2008.1 Companies that had based their social business strategies around the unique audience and capabilities of MySpace experienced more impact than those that designed for a higher range of change and a higher-level concept of what they were seeking to achieve.
Fortunately, the broad outlines of core social business building blocks can be discerned. However, one more significant wrinkle must be considered: the nature of digital change itself, which is primarily concerned with how the Internet is used to conduct business. Therefore, it's somewhat difficult to consider many aspects of social business in a vacuum from an organization's overall digital strategy, such as Web presence, e-commerce, Internet advertising, online video, and search engine optimization. In fact, social media are increasingly pervading each aspect of these digital practices, making them more participative, social, and emergent.
Thus, this chapter focuses on examining the big picture of social business in relation to modern digital strategy, including mobile (see Figure 14.1). Mobility is included here as one of the leading new delivery methods for digital and social media. Business leaders from PepsiCo to Facebook believe that smart mobile devices, such as the iPhone, Android, and other as-yet unimagined platforms, will remake the end user experience.2 Kleiner Perkins partner Mary Meeker, famous for her detailed Internet and technology adoption statistics, notes that mobile is on track to be the primary method of user experience for the Web; in fact, in 2011, tablets and smart devices together outsold all PCs, including laptops. Mobile social networking is also accelerating this change as hundreds of millions of people shift their social media habits to entirely new devices and applications.3
Moving clockwise around the breakdown in Figure 14.1 gives a sense of the broad picture of the elements. Each element addresses one or more of the constituent audiences of social business.
Figure 14.1 Putting Social Business into Context with Digital and Mobile Strategy
Note: SMS/MMS = short message service/multimedia messaging service; BI = business intelligence; GPS = global positioning system; RFID = radio-frequency identification; SNS = social networking service; SEM = search engine marketing; SEO = search engine optimization; API = application programming interface; E2.0 = Enterprise 2.0
As one of the first major social business activities, social media marketing is a common activity in most organizations, with the majority reporting successful results in a University of Massachusetts study conducted in 2010.4 While social media marketing consists of a large number of practices, early adoption has been helped by the perception that it's the easiest and least risky to start with. The resulting early marketing focus has increasingly affected many related areas of digital strategy. Consequently, social media marketing is furthest along in the capabilities of many organizations, including areas such as community management, tool selection and use, and organizational design. One of the most significant challenges in this area remains the gap between push marketing and engagement marketing. Put simply, straightforward copying of push marketing techniques into social media channels doesn't work well. As explored in Chapter Six, the most effective results come from strategically engaging with the marketplace to jointly cocreate desired outcomes and network effects. Social marketing is now well beyond the early adoption phase, with 83 percent of Fortune 500 companies engaging in at least one social media service by late 2010.5
A new aspect of digital marketing, demand generation consists of targeted digital awareness efforts to drive an understanding of and interest in a product or service. Primarily employed in business-to-business, public sector, and longer term business-to-consumer (B2C) sales cycles, demand generation involves multiple areas of marketing, including social media. It can be described as the fusion of marketing and sales into a holistic effort, using sophisticated support tools to combine data management and intelligence that allow community management of strategic marketing goals. Effective social business integration has also been appearing recently in off-the-shelf demand generation platforms such as those from Pardot, Marketo, and Eloqua, which can supplement and automate bespoke demand generation processes.
A long-term and vital component of Web strategy, search engine optimization (SEO) is as important as ever as the proliferation of content accelerates. With the volume and pace of content creation increasing—the vast majority being user generated—SEO is the intentional treatment of Web markup language to ensure that content is readily discoverable by search engines.6 SEO is important externally as well as internally to an organization and remains a key aspect of digital strategy. It continues to evolve and expand as video, speech recognition (for audio), semantic, and social search engine optimization have become more commonplace. Social business strategies that don't have an SEO component will result in less discoverable information, lowering their return on investment.
Closely connected to SEO, search engine marketing (SEM) is the marketing aspect of the practice of optimizing information for discovery in order to promote Web sites and social media to increase their visibility for sales, branding, and other purposes.
Interactive online experiences embedded into social networks have become increasingly common as engagement mechanisms, colocating branded user experiences within a broader social networking platform. By tapping into users' activity streams and social graphs, social networking applications have both the immediacy and full social context of their users to create a high-impact and shared social experience. Social networking applications exist for a wide range of purposes, including education, productivity, gaming, and marketing. Market leader Facebook has hundreds of thousands of available applications, and social apps are just now beginning to move seriously into the enterprise as well as through technologies such as Google-backed OpenSocial.
Most businesses today have an online advertising strategy, usually underused in all but the most sophisticated Web industry firms where sophisticated multichannel tools and adaptive ad strategy are commonplace. For example, Amazon allows competitive ads on its own product pages, generating revenue on a momentary visitor impression, even if the customer decides to purchase the product someplace else. Advertising now goes beyond text ads to sophisticated user experiences that leverage rich media, social media, cross-platform experiences, contests, and cocreation, and consists of carefully designed marketing funnels.
The early world of consumer social media, consisting of blogs, wikis, and simple social networks, has exploded into a sophisticated world of global social networks, mobile applications, and aggregation involving most of the developed world. Social business strategy connects to this complex landscape by exploring the many motivations and options in engaging with consumer social media to create better business outcomes.
As we explored in Chapter Nine, customer relationship management (CRM) has been transformed by social media for a number of years. Although the social media aspect of CRM is still early in its maturity, CRM itself covers a wide range of activities, including sales, marketing, customer service, and technical support. Each of these aspects benefits from the integration of social media. Presales Facebook engagement, online support communities, and crowdsourced technical support are common uses of social CRM, with successful examples including Get Satisfaction and FixYa showing that CRM costs can be reduced while simultaneously increasing customer satisfaction and loyalty.7
Some leading examples of customer communities, such as HDTalking for Harley-Davidson fans and the IKEAFANS community for Ikea enthusiasts, are often created by customers, not the companies whose products or services they support. Customer communities, which started as little more than online discussion forums for tech geeks in the early days of the Internet, have gone on to become a key differentiator in the way that mainstream businesses engage with their customers and the marketplace. In the social business era, the traditional corporate Web site, acting more as an online brochure instead of a way of participating in useful business activities with the marketplace, is being supplanted with more meaningful and productive aspects of customer engagement through the structured and unstructured activities of online and highly social communities.
Making an impact on a number of areas of digital strategy, especially when social business is concerned, community management provides the necessary oversight, moderation, and support that social media need to drive initial adoption as well as remain successful and sustainable for the long term. Often informal and increasingly recognized as a key function, community management has been gaining respect as an indispensable capability of modern digital experiences that can lead to higher levels of success.
As organizations look to scale their businesses using digital channels and labor costs limit their ability to meet business partner needs, they often discover that they don't have the staff to reach out and directly support thousands of trading partners, franchisees, and affiliates. Private label communities and social networks have become a prime tool in servicing these constituencies with a fraction of the staff. Frequently they lead to higher levels of awareness, engagement, service, and transaction levels than before.
Supply chain management has been one of the business functions least affected by social media, and it's one of the last areas of traditional business to be transformed with social business approaches. This is beginning to change, however, as we illustrated in the example of Teva Pharmaceuticals in Chapter Three, which reported a manufacturing cycle time reduction of 40 percent as well as a reduction in supplier lead time by up to 60 percent by applying social software to communication challenges.8 The closely related concept of open supply chains, created by using simple application programming interfaces and supported through developer communities, has led to growing change in the way business partnerships are digitally delivered and has been adopted by traditional organizations like Best Buy, Sears, and the World Bank.9
The cocreation of ideas and peer production of work has become highly scalable and dramatically less expensive as tool sets and techniques have matured. A new crop of idea management services and platforms employing social business approaches, such as Spigit, and crowdsourcing platforms like Crowdspring and Amazon's Mechanical Turk have led to a small and steadily growing revolution in the way businesses can collaborate directly with the marketplace with their initial efforts or operational investment.
The use of internal social media, explored in detail in Chapter Eleven, has become increasingly common. The manner in which social media gain a foothold in organizations varies widely, often beginning in social content management tools like wikis or getting started as an internal corporate blog or other unsanctioned social tool. Corporate communication departments are increasingly incorporating social media into the company intranet as information can be found faster, knowledge is retained better, and employees are more efficient and productive when there is widespread social collaboration.10
Embraced by companies as one of the very first aspects of Internet strategy, Web presence today includes rich media, mobile access, e-commerce, software applications, self-service CRM, and now social media. Web presence is often located in a dedicated and frequently isolated project, next to, rather than integrated with, an organization's broader Internet strategy, since the platforms and tools on which it is based are either aging or technologically obsolete and are challenged in how they can enable the latest digital capabilities. Web presence remains a vital component of digital strategy, but its relevance is steadily being eroded by newer forms of engagement, including mobile applications and social business. Organizations can effectively reconcile newer digital strategy elements with legacy Web presence to create multichannel engagement strategies on their Web sites and elsewhere as they go up the engagement maturity ladder (see Figure 6.2).
Microsites—Web sites publishing data focusing on a very specialized subset of company information—became increasingly common for targeted engagement as companies realized that customized digital communication was effective. Microsites remain an effective way to narrowcast online to a target audience or community to increase relevance, deepen reach, and foster engagement.11
The growing dominance of e-commerce has steadily risen and is currently forecast to be a trillion-dollar business in the United States by 2014.12 The latest developments include the rise of social commerce and daily deal services such as Groupon that connect discount e-commerce to local businesses, mobile e-commerce enabled by providers like Digby and Shopkick, and new payment systems, as well as social SEO (now the leader in driving inbound leads) and gaming.
The idea that opinion makers and thought leaders can be engaged with indirectly to take advantage of the audiences they've created for themselves, rather than businesses recreating the engagement levels that individuals have already established with the market, is the concept behind influencer engagement. Often a key element of digital marketing strategy and an essential component of social marketing, influencer engagement is largely a manual activity because automated capabilities are still in early stages.
Analytics and business intelligence across most aspects of digital strategy have emerged as a leading trend in the industry for their ability to derive useful insight and glean value from the social media relevant to the business. Companies can use emerging tools and techniques to work with vast quantities of data and make sense of the combined behavior of their workers, customers, and business partners. The resulting social business intelligence can make meaningful use of their collective knowledge to create competitive advantage.
Despite fundamentally new forms of social engagement, the practice of developing and maintaining brand for establishing corporate and product identity remains a crucial aspect of digital strategy. This is true even as brands themselves are becoming increasingly influenced and defined directly by their customers. Peer-produced and cocreated marketing and advertising campaigns continue to proliferate as a result.
While e-mail is in slow decline in terms of use (see Figure 2.1), it remains an integral part of digital strategy for the foreseeable future. With its effectiveness dramatically reduced by the growth of e-mail spam and facing stiff competition from consumer, and now enterprise, social networks, e-mail is a less appealing channel now than it once was. However, as a notification tool, a viral feedback loop for social activity, and a useful touch point for multichannel CRM and marketing, e-mail is still necessary for social business.
As smart mobile devices become a leading way for the world to engage digitally, their global positioning sensors create opportunities to incorporate location awareness to drive marketing, sales, CRM, and operations. In the consumer world, geotagging of photos and the emergence of location-based social networks such as Foursquare have proven quite popular. While effective use of location remains in its infancy for most businesses, applied as part of a digital strategy, location awareness can drive improved personalization, useful geographical context, analytics, and process efficiencies for many types of business solutions.
Delivering service to internal users, trading partners, and customers means providing smart mobile-enabled solutions such as native mobile applications. Typically this means iOS and Android platforms for delivery of internal and external mobile applications. In order to deliver social business solutions on these new mobile devices, organizations must develop competency in mobile application development, operations, and management, as well as matching security, analytics, branding, advertising, and other related aspects of digital strategy.
Enabling mobile use of existing information assets requires making existing content and user experience function optimally on the form factors and screens of mobile devices. Some of this process can be automated and is also usually less expensive and time-consuming than developing new mobile applications, though it can be less effective. Enterprises must consider the entire user experience including search, consumption, participation, and social business intelligence.
While the Web remains a crucial touch point, mobile applications are becoming a vital and important way to provide digital engagement, social and otherwise. For example, one of the most effective ways to engage with people under thirty years old is to have an application on the first or second screen of their smart mobile device.13 Given the demographic trends, virtually all companies should be developing smart mobile capabilities for delivering digital engagement through mobile devices and ensure integration with the rest of their digital strategy.
SMS (text) and MMS (images, audio, video) are among the most popular communication services in the world. However, they are threatened by the introduction of major new proprietary services such as Apple's iMessage service and a growing number of independent service providers, such as Pinger's popular Textfree app. Despite the technology's extensive history, organizations are only now beginning to absorb the lessons on how to employ mobile messaging for CRM and marketing and, to a lesser extent, soliciting user input such as surveys and other data collection. The growing market fragmentation of major new noncarrier messaging services provides opportunities to drive down the costs of using this channel just as it begins to lead channel proliferation challenges. Some early social media services, such as Twitter, began on mobile messaging services, and it can be a useful method of customer and worker engagement, especially for social business.
Mobile application use inside organizations is rapidly growing, estimated at 15 percent per year in 2011.14 Organizations are experiencing steady demand to provide existing services and solutions via electronic tablets and smartphones. While custom internal applications stores are a few years away for most organizations, building or buying mobile business applications is now well under way in many companies. Social media are readily available in mobile application form, and many applications now include social networking integration. Weaving social business capabilities into mobile applications focused on specific business processes or functions will become increasingly common.
Considerable operational capability and infrastructure development must be carried out, particularly with security and mobile management, in order to deploy smart mobile strategies in the enterprise. Bandwidth management for video chat is just one example of the challenges that mobile operations bring to the table. Social business strategies must anticipate capability levels and pursue funding to develop this area of the organization.
Just as Apple set the expectation that mobile apps come from app stores, enterprises are now looking at enabling the same conduit. App stores are positioned to be a leading distribution model for both external and internal mobile applications. While these stores are already the primary way new applications are acquired on smart mobile devices, organizations have a considerable amount of work to do to resolve issues around data security, provisioning, and governance before they can open up stores inside their organizations to handle and use business data.
Not part of digital strategy normally yet a required capability for internal use, mobile security is a key enabler and requirement for the move to mobile applications, particularly on platforms that are less controlled, such as Android. The priority with this capability is to ensure that customers and workers have a safe and effective mobile experience for those delivering through digital channels and social business solutions.
Social media have had a sustained and continuing impact on content and document management, to the extent that many of the latest iterations of these tools are major social platforms in their own right (Drupal is an example). Reconciling the proliferation of social media, content management, and document management platforms, many of which also connect to the public and have digital strategy implications, is one of the bigger challenges for enterprise information technology departments.
Key to workforce engagement, intranet strategy is not typically part of traditional digital strategy, yet it is important as workers become more connected to customers and partners through digital channels, including social media. Social media are continuing to be adopted by more enterprise intranets; however, only a loose integration between digital strategy and intranet strategy exists in most organizations given the diversity of stakeholders. Social business strategies should include an intranet component for the workforce engagement part of their effort.
Concerned with connecting all types of communication into a single coherent strategy, unified communications have considerable overlap with social media. Though lagging in social offerings, unified communications platforms and strategy now take social media into account.
Rich media continue to grow as part of a robust and complete digital strategy, especially using social media, the leading source of rich media today. The emerging-growth areas that a social business strategy should focus on are in persistent multipoint video chat, video archival and search, mobile video, and transcription and SEO capabilities. Integration of video into digital experiences and mobile applications is also growing; for example, Facebook added Skype-powered video calling in July 2011, and Google+ allows users to connect in video “hangouts” using a mobile application. Rich media are believed to lead to better engagement and productivity.15 Digital strategies that treat video as a driver of network effect and accumulated value growth will have the most significant long-term return on investment.
The challenge of taking such a broad-based perspective on the intersection of digital strategy and social business becomes finding and coordinating principals within an organization who can drive integrated strategy without slowing social business progress. As we explore in Chapter Eighteen, however, it's only by coordinating and supporting distributed action on the ground, enabling consistent yet widespread autonomous action via a social business unit, that an organization can implement social business in a controlled yet rapid manner.