Now that Facebook has hit the market, the social media world is officially spinning at hyper speed. Examples: When Facebook first announced its intentions to go public back in January, Pinterest was a mere curiosity; Yelp was a risky stock to buy; Instagram was just a photo app. Speed in this business continues to be defined on a daily basis. My concern is that while we're watching Facebook, marketers are missing out on rising companies, key customer intelligence opportunities, and watching some numbers that won't matter much in the end.
I'm as guilty as anyone. We have all hit the white boards with calculations on what Facebook will be worth, what each customer could be worth, and how those metrics could affect campaign costs. In fact, VentureWire recently publicized an interesting numerical exercise that valued each individual status update for leading social networks. To get this number, cloud security company Backupify took each company's estimated annual revenue and divided it by the number of items of content. By this measure a Tweet equals $0.001; Facebook share, $0.024; Yelp review, $9.13.
Valuations will be necessary and fun water cooler talk, but engagement is priceless. Social engagement will produce the most valuable currency -- customer intelligence -- during this era of social media growth. Facebook measured properly will create deep social insights. Right down the line from Facebook, Yelp to Pinterest and especially Twitter, customer insights are there for the gleaning. A unified metric for engagement across all social media networks has not yet been developed, however there are three general categories that can help lead this effort. They may change by network and the customer segment, but they are a goldmine for marketers.
Understand that not all words are created equal. The word "so" can mean a lot of different things depending on the context and tone in which it is used. As the adage goes, "actions speak louder than words," and this has never been truer than in social media. The important thing to measure beyond what people are talking about is to understand their associated actions and behaviors. Words are weighty things on social media. Natural language processing technology will help to automate the understanding of "this market was jammed" or "this market was jamming" or "this market sells jam." These subtle differences demonstrate the importance of having the right advertising and page analytics tools, ones that are strong in data mining and machine learning.
The most deeply engaged social media customers are the ones who positively recommend, comment, and share. At this most basic level, a brand can tell who is interested based on "likes" and "followers." However, what really makes social media engagement compelling is that you can now go a level deeper and gain insight into your audiences interests, affinities and behaviors -- both online and off -- , as well as those within their inner circle. So the customer who has checked in on Foursquare at a local farmer's market is engaged at a basic level. But if they write a Yelp review following the Foursquare check in, now they have taken an interaction and turned it into an engagement accessible and broadcasted to their entire network. If that Yelp review correlates with an affinity for organic food, now a brand has identified a new interest cluster and audience to target, effectively expanding its circle of engagement.
Facebook introduced this metric in November, and in my experience marketers are still struggling with how best to utilize it. It counts the number of unique users that have interacted with your page in the past week. This is the audience you really want to tap into. It's true that brands need to listen to customers, i.e. those who have "liked" their brand, but it is more important that they listen to those who actively engage with the brand versus everyone that just shows up. Understanding how your audience engages with your brand can be one of the most profitable exercises a marketer undertakes.
So talk all the IPO numbers you want. Remember though, that Wall Street is a harsh judge. Even good news can get a bad spin. Facebook is entering a very harsh spotlight. Those numbers that are so much fun to speculate on will become analyzed and criticized data in due time. One year from now, engagement metrics and social intelligence data are going to be much more important to a brand than Mark Zuckerberg's fashion choices or his companies' share price.
Dilip Venkatachari is CEO of Compass Labs.
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A great point to make about the power of customer intelligence. New technologies afford companies as well as individuals the ability to monitor users preferences based off their interactions. The more a user engages, the greater digital footprint left behind. Companies that best track these footprints will be able to deliver sites and services that foster further engagement…and dedicated customers down the line. http://bit.ly/HWhOoo
Awesome not to the future of engagement. I think it's about time that people start to realize that impressions and likes are just not enough - engagement is the key in online display as well as in social media. Just as our CEO Sebastian Tonkin recently explained in a post on mediapost 'Understanding the cost-per-engagement ad model' http://bit.ly/KNX4Py
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