BIG DATA - OPPORTUNITIES AND CHALLENGES FOR MARKETERS

January 29, 2015

Written by Emil Westrin

“We never, ever in the history of mankind have had access to so much information so quickly and so easily.”  (Vint Cerf, “father of the internet” quoted in Silva 2009)

Big data is the big thing in business today. We have all been told that big data will change our lives and revolutionize the way we do business. Marketers are no exception as marketing departments around the world are striving to implement big data into their routines. It is the word on everybody’s lips but do we actually know what we are talking about?

The purpose of this blog article is to demystify the concept of big data and to give marketers a better understanding how big data can be used in the planning, execution and analysis of marketing activities.

What is big data?

Every day, we create 2,5 quintillion of data on this earth. That is a staggering figure which can be exemplified by the fact that 90% of the data in the world today has been produced in the last two years alone (IBM, 2011). Big data has supposedly created big opportunities. The main idea for businesses is to exploit the growing mass of accessible information in large based on financial transactions or customer interactions to maximize business performance and create competitive advantages. (Purcell, 2013; Biesdorf et al, 2013) Collecting data to improve competitiveness is not a new phenomenon however; it has been around for decades. In the early nineties it was common for large corporations to build and take advantage of customer information systems. These systems were used to understand individual customers better and to develop and market new products based on the preferences of the consumers (Bessen, 1993).

Since the nineties we have experienced the digital revolution with the gradual shift towards digital products and information. This combined with innovations such as new databases and eventually clouds storage, has enabled companies to gather, store and analyze huge quantity of data much more efficiently. The result is a boom in data storage (Varadarajan & Yadav, 2009; Nunan & Di Domenico, 2013). Data is being stored, traded and used much like commodities today.  Some of the biggest corporations in the world are in the forefront of the data frenzy. Wal-Mart, the American retail giant handles and stores more than 1m customer transactions per hour, 40 billions photos had been uploaded to Facebook by 2010, and 48 hours of video is being uploaded to Youtube every minute (The Economist, 2010; Allocca, 2012).

What is the big deal?

So, with the vast amount if information easily accessible, it seems easy to reap the benefits in order to create competitive miracles.  Big data is a hot tech topic and is actively discussed in most business media today.  Some are giving movies like “Moneyball” or the books such as  “Freakenomics” part of the credit for the big data’s rise in popularity. Numbers and statistics have become somewhat “hip” again (NYtimes, 2012).

There are plenty of success stories and factors that point to an inevitable growth of big data usage. For example; 10-15 percent of organizations today are using big data in some capacity, and these companies outperform their competition by 20 percent (Scott, 2013). Greater willingness from consumers to share personal information online combined with the before mentioned technological advancements has increased the commercial value that can be added to organizations by using big data (Nunan & Di Domenico, 2013).  Another reason big data is celebrated it the way it empowers consumers as well. It has never before been so fast and easy to compare prices online as today (Sluis, 2014; Fulgoni, 2013).

Big data and marketing

Big data has created big opportunities for marketing departments all over the globe. The easy access to vast amount of information based on customer interactions has enabled marketers to go from knowing the customer as a demographic to understanding him or her as an individual (Sluis, 2014).  Bessen (1993) argues that successful marketing always has relied on a two-way information flow between the marketer and the customer. The marketers’ challenge has always been to collect detailed demographic and life-style information on consumers that can be used as a basis for effective and efficient activities. Today, it is easier than ever to establish the two-way information flow due to the Internet, social media and big data.  The challenge for many marketers today has moved from having too little information to having too much information coming from too many sources. The vast amount of data has turned marketers into insight hunters. Consequently, one of the greatest challenges for marketing departments is to create an information ecosystem by combining patterns of data from different sources (Prajicek, 2013).

Online giants such as Google and Facebook have made harnessing the data on the web into extremely lucrative businesses. Based on big data, Google and Facebook can now offer their clients tailored campaigns based on for example online searches, posts and messages. Marketers involved with Internet marketing know the potential reward of cost-efficient tools such as social media feeds, user videos and image posts etc. All the online tools have converged into massive dashboards that give marketers real-time and holistic views of the consumers and their ongoing activities (Smith, 2013). Marketers have been armed with advertising optimization capabilities overall, based on the growing amount of big data available to them (Fulgoni, 2013).

The challenges of big data for marketers

Prajicek (2013) criticizes many marketing departments for committing the “more is better”-fallacy. He argues that they seem to think that adding more sources of information will lead to better answers.  Having terabytes of data available but no one to successfully interpret the data is a major mistake.  And the fact is that many marketers lack skills that would enable them to use big data successfully (Vriens & Brazell, 2013; Ross, 2013). Another common mistake marketers commit is that they spend too much time “in the cloud” looking at macro trends. Great data and great insights are often wasted when big data is not being leveraged by little data and interpreted based on the integrations and relationships it’s based on (Ross, 2013; Fox & Do, 2013). Great data needs to be acted upon in order to create the potential competitive advantages.

Another challenge of big data stems from the established clash between marketing and sales. Big data can erode long-term marketing commitments in order to promote short-term sales. Fulgoni (2013) warns that a reliance on big data in a company has a tendency to cultivate a short-term decision making mindset. 

One of the main criticisms against the use of big data in marketing is the implication on individual privacy.  How much information on about consumers can big corporation store before it becomes an intrusion on private life?  There have been voices calling for ethical guidelines for the commercial use of big data, some actors have gone so far to call for self-imposed regulation in order to keep the consumers’ trust (Nunan & Di Domenico, 2013; Sluis, 2014; Cumbley & Church, 2013).

Key takeaways on big data for marketers

There are several reasons behind the rise of big data. The emergence of new technology such as more sophisticated databases and cloud technology has further pushed the boundaries of the digital revolution. Gathering, storing and analyzing of data has become more cost-efficient and organizations are not late to capitalize the potential benefits. This is proven by the statistic stating that the 10-15 percent of companies that are using big data are outperforming the competition by 20 percent.

The value of big data for marketing departments can best be explained by using the two-way information flow between the marketer and the customer, presented by Bessen (1993). Big data has enabled marketers to go from knowing the customer as a demographic to understanding them as an individual. The incredible depth of consumer information makes it possible for marketers to tailor their products, offers and activities to meet the expectation of a specific individual. Marketing with the use of big data will force marketers to attain certain skills in order to make use of the data. Marketers will chase insights by combining a mix of findings and data. Big data has started to provide marketers with real-time and holistic view of the consumers and their ongoing activities.

But marketers also need to acknowledge the challenges that come with using leveraging big data. The major question mark for the future is the implications on the consumer’s privacy.  Marketers with access to big data should strive to do ethically right and listen to common sense.

References

Allocca. K. (2010), Why videos go viral. Available online at: http://www.ted.com/talks/simon_sinek_how_great_leaders_inspire_action.html [Accessed 15 january 2014].

Bessen, J. (1993), ”Riding the marketing information wave”, Harvard Business Review 71(5), 150-160.

Biesdorf, S., Court, D., & Willmott, P. (2013), “Big data: What's your plan?”, McKinsey Quarterly  2, 40-51.

Cumbley, R., Church, P. (2013),”Is “Big Data” creepy?”, Computer Law & Security Review 29(5), 601-609.

Fox, S., & Do, T. (2013). Getting real about Big Data: applying critical realism to analyse Big Data hype. International Journal of Managing Projects in Business, 6(4), 739-760.

Fulgoni, G. (2013), ”Big Data: Friend or Foe of Digital Advertising? Five Ways Marketers Should Use Digital Big Data to Their Advantage.”, Journal of Advertising Research 53(4), 372-376.

IBM (2013). “What is big data?”, Available online at: http://www-01.ibm.com/software/data/bigdata/what-is-big-data.html [Accessed: 15 January 2014].

Krajicek, D. (2013), ”Market research and the ethics of big data”, Marketing Insight 25(1), 8-9.

New York Times (2013), “The Age of Big Data”, Available online at: http://www.nytimes.com/2012/02/12/sunday-review/big-datas-impact-in-the-world.html?pagewanted=all [Accessed: 15 January 2014.]

Nunan, D., Di Dominico, M. (2013), ”Market research and the ethics of big data”, International Journal of Market Research  55(4), 2-13.

Purcell, B. (2013). The emergence of" big data" technology and analytics. Journal of Technology Research 4, 1-7.

Ross, J. W., Beath, C. M., Quaadgras, A. (2013), ” You May Not Need Big Data After All”, Harvard Business Review 91(12), 90-98.

Scott, N. (2013), ”Big data: What's the big deal?”, Director 66(10), 61-65.

Silva, D. (2009). The internet has only just begun, say founders”, Available online at: http://phys.org/news159644537.html [accessed 15 January 2014].

Sluis, S. (2014), ”DMA13 Marketers Must Carefully Consider Big Data Strategies”, CRM Magazine 18(1), 8.

Smith, S. (2013), ”Is Data the New Media? [Big Data impact on the media industry]”, EContent 36(2), 14-19,

The Ecoomist (2010), “Data, data everywhere”, Available online: www.economist.com/node/15557443 [accessed 15 January 2014].

Varadarajan, R. & Yadav M. S. (2009), “Marketing Strategy in an Internet-Enabled Environment: A Retrospective on the First Ten Years of JIM and a Prospective on the Next Ten Years”, Journal of Interactive Marketing 23, 11–22.

Vriens, M., Brazell, J. (2013), ” The COMPETITIVE Advantage”, Marketing Insight 25(3), 32-38.

The Power of Social Media: A Case of Kentucky Fried Chicken in China

January 26, 2015

Written by Wanyi Wang

Introduction

In China, recent developments in web and Internet technologies produce some new things for people. The most popular online content, applications and services called social media which has changed people’s life. A lot of people are toward the use of social media. For example, “5,700 China’s Internet users have found that 95 percent of them are registered on a social media sites” (Chiu, Ip & Silverman, 2012 [1]). Social media is a developing phenomenon in today’s marketing. (Hoffrnal & Novak, 2012) Companies are beginning to use the fashionable tools such as Facebook, Twitter and YouTube in marketing strategies and campaigns. The use of traditional media has decreased since marketers have turned their attention to social media. (Akar & Topsu, 2013) It is necessary to state that China’s social media have something different than Western. No Facebook and Twitter, people use China’s social media such as Qzone and Sina Weibo. (Chiu, Ip & Silverman, 2012 [2]) Recently, there is a hot topic discussed on China’s social network and many people reblog it. The author would analyze why most companies shift their attention from traditional media to social media through the hot topic.

The purpose of this paper is to understand the power of social media. More specifically, the author using a case of Kentucky Fried Chicken (China) to analyze why companies display online marketing campaigns can create more value than traditional media.

Literature Review

In the past, consumers accepted messages from traditional magazines, radio, television and direct mail. The product-focused one-way interruption mass communication gives a lot of trouble and inconvenience to receiver. Some consumers do not trust the information which provides by traditional media. (David, M. Scott., 2007) The new types of social media named Web 2.0 which including many different types such as social networking sites, blogging platform, social search applications and social coupon sites(Hoffrnal & Novak, 2012). According to Chiu, Ip and Silverman (2012 [2]) describe, the most popular China’s social media sites are: Qzone, Sina Weibo and Renren. The basic function is the same as Facebook, Twitter and YouTube. The new online technology Web 2.0 has grown to a scale. (Hoffrnal & Novak, 2012) With the rise in social media, consumers are beginning to talk about brands and products. Social media produce the opportunities to people communicate and exchange information with each other. Consumers also can get information from social media, and then they can instantly give feedback or share their ideas without any technical knowledge. (Akar & Topsu, 2013)

Hanna, Rohm and Crittenden (2011) mention that “traditional media is all about reach which can be achieved in large numbers and it often does not translate into a true marketing exchange.” However, social media has changed the traditional mode of market information, consumer changed from passive roles to an active role in the marketing process. “They simultaneously act the initiators and the recipients of information exchanges.” (Kietzmann, et al., 2011) The interactive digital media sites allow consumers connect, share and create information and fundamentally changed the way marketers control marketing activities (Hanna, Rohm, Crittenden, 2011).

As Hansen, Sheiderman and Smith, (2011) describe “billions of people create trillions of connections through social media each day.” Social media is a powerful and effective medium to communicate with millions of potential consumers for companies. Hence, companies who use social media may gain a chance of reaching a wider audience. (Bamford, 2012) Meanwhile, social media can help a company build a good relationship with consumers. Business uses two-way communication may provide an intimate and warm feeling for consumers. (DiPietro, et al., 2012) Moreover, consumers toward the use of social media in creating and exchanging message in today market. The message exchanged by consumer themselves which result in creating word-of-mouth communication. (Papasolomou & Melanthiou, 2012) When looking at the word-of-mouth effects, the effects of social media last longer than the effects of traditional marketing (Trusov, Bucklin, & Pauwels, 2009). Social media often has higher credibility and trust than traditional media (Akar, & Topsu, 2013). In addition, social media offer increased traffic and improved search rankings for a company or a brand (Hanna, Rohm & Crittenden, 2011). It means the exposure also increases. All the power of social media may lead a good consequence to sales (Dyer, 2013).

Case Analysis

Kentucky Fried Chicken is a fast food restaurant chain which famous for fried chicken and it also provides hamburgers and French fries etc. After KFC reach China market, it is intended to become the first fast food restaurant. In order to achieve the goal, KFC adjusts some products according to Chinese taste preferences and obtains consumers’ praise. In order to gain consumers’ attention and attract them to patronage, KFC promotes itself through making a series of advertisings and activities in Chinese markets. (KFC China, 2012)

In the past, KFC (China) devoted time and money to offline marketing such as TV advertising and posters etc to promote its products. Along with the social media is widely used and a large number of people fall into the trend. KFC is beginning to use social media as the communication tools. Recently, FKC (China) Company used social media to communicate a message and simultaneously involving the consumers in the campaign. (http://kfcpk.qq.com/) This message told consumers that, the classical “Original Recipe” stop selling five weeks in KFC China market from 30 December 2013. The new product “Extra Crispy” instead the “Original Recipe” is provided in this period. Consumer can join the campaigns to vote “the favorite fried chicken” to decide whether the “Original Recipe” will continue to sell in KFC China market. (KFC, 2013) KFC uses China’s social media sites Sina Weibo, Renren and QQ to develop the message.

谁能代表KFC   (Who can represent KFC)

Figure.1 Who can represent KFC (KFC, 2013)

In the past 43 days, more than 13 million people vote for the KFC campaigns through social media. This result is not the final result and the number of voting people continues to grow. As Hansen, Sheiderman and Smith (2011) mention social media have the unique charm of “billions of people create trillions of connections through each day.”In view of the large number of Internet users registered on a social media and be active in social network. KFC (China) decided to create an online marketing campaign and using social media to touch millions of potential consumers quickly. On the other hand, KFC’s main targets are young people in China. Most users of social media such as Qzone, Sina Webo and RenRen are precisely young people. Hence, creating and exchanging message through social media helps KFC accurately aim at its target group.

In this period of doing the campaign, consumers simultaneously act the initiators and the recipients of information exchanges through social media (Kietzmann, et al., 2011). First of all, consumers receive the message and then who like the new product “Extra Crispy” may offer a positive evaluation in social media sites. Then, they are willing to share the positive information and recommend the new products for their friends through the social media. This interactive communication provides an intimate and warm feeling for consumers, then building a good relationship between company and consumers (DiPietro, et al., 2012). From the recipients’ perspective, they are more likely to believe information which provided by friends than a marketer. Hence, a company use consumer as the recipients can bring higher credibility and trust (Akar and Topsu, 2013).

Of course, social media cannot avoid negative evaluation. Some consumers think the classical “Original Recipe” is the soul of KFC. They do not support using new fried chicken instead of the classical one and they hope to enjoy it unceasingly. Some of consumers hope KFC keeps both “Original Recipe” and “Extra Crispy” in market. As Papasolomou and Melanthiou (2012) describe the message exchanged by consumer themselves which result in creating word-of-mouth communication. More than 40 days later, many consumers still discuss this topic. Some consumers are waiting for a result of the campaign. Like Trusov, Bucklin and Pauwels (2009) mention, the effects of social media last a long period of time than traditional media. Launching the campaign only uses one day, but consumers’ discussion leads the campaign exists in people’s mind for a long time. However, if launching the new product through TV advertising. The effects will disappear with the stop of the advertising.

No matter the positive or negative evaluation provided by consumers through social media. The campaign “Original Recipe PK Extra Crispy” causes a fierce discussion. The hot topic increased KFC exposure and also improved search rankings (Hanna, Rohm & Crittenden, 2011). The results prove that consumers accept the interactive communication and willing to join the campaign. Consumers are beginning to contradict the traditional one-way communication which companies tried to control and decide how their products should be perceived by the customers. Sometime, consumers dislike the feeling that advertisings interrupt them when they watch TV or listen to the music.

From another aspect, social media can help the company improve sales (Dyer, 2013). No matter consumer tries the new product for the campaign or fierce discussion makes consumers want to try. A sustained rise in the sales of “Extra Crispy” from the campaign obtains consumers’ attention (CYOL, 2014). Consumers will continue to patronage the new product if they love the product. It also has opened the door to the sales of products in the future.

Conclusion

In summary, the power of social media is obvious through analyzing the case of KFC (China). The cheap social media create a great value for KFC not only result in sales, but also involve many aspects. First, social media provide a chance of reaching a wider audience for a company or a brand (Bamford, 2012). Second, social media help company to build a good relationship with consumers (DiPietro, et al., 2012). Third, the message exchanged by consumer themselves which result in creating word-of-mouth communication (Papasolomou & Melanthiou, 2012). Fourth, social media involve higher credibility and trust (Akar, & Topsu, 2013). Fifth, social media offer increased traffic and improved search rankings for a company or a brand (Hanna, Rohm & Crittenden, 2011). All these benefits from social media let companies shift their attention from traditional media to social media.

Social media have begun to explore a location in online marketing and have influenced companies and consumers to a large extent. Companies now pay attention to social media marketing. It is worth reminding, social media is a two-edged sword. We cannot say social media is a flawless approach. To be sure, companies need to consider both advantages and disadvantages of social media in the future. Using it in the correct way will bring more value to a company.

References:

Akar, E., & Topsu, B., 2013. “An examination of factors influencing consumers’ choice of social media marketing”, Journal of Internet Commerce, 10(1), 35-67.

Bamford, N., 2012. “Why you should consider using social media”, Money Marketing (online edition), pp.8.

Chiu, C., Ip, C. & Silverman, A., 2012. [1] “Understanding Social Media in China”, Mckinsey quarterly, 2, pp.78-81.

Chiu, C., Ip, C. & Silverman, A., 2012. [2] “China’s Social-media Boom”, Mckinsey quarterly, [online] Avaliable at:< http://www.mckinsey.com/insights/marketing_sales/chinas_social-media_boom> Viewed: 11 Feb 2014.

CYOL, 2014. “Consumer support the new product ‘Extra Crispy”. [online] Avaliable at:< http://roll.sohu.com/20140117/n393688672.shtml> Viewed: 12 Feb 2014.

David, M. Scott., 2007. “The New Rules of Marketing and PR: How to Use Social Media, Blogs, News Releases, Online Video, and Viral Marketing to Reach Buyers Directly”, John Wiley & Sons, Inc.

DiPietro, R., Gustafson, C., Strick, S. & Crews, T., 2012. “The use of Social Networking Sites in the Restaurant Industry: Best Practices”, Journal of Foodservice Business Research, 15, 3, pp. 265-284.

Hanna, R., Rohm, A., & Crittenden, V., 2011. “We’re all connected: The power of the social media ecosystem”, Business Horizons, 54, 3, p.265-273.

Hansen, D., Sheiderman, B. & Smith, M.A., 2011. Analyzing Social Media Networks with NodeXL: Insights froma a connected world, [Electronic Resource], n.p.: Morgan Kaufmann Publishers, A-Z Resources.

Hoffrnal, D., & Novak, T., 2012. “Toward a Deeper Understanding of Social Media”, Journal of Interactive Marketing, 26, 2, pp. 69-70.

KFC China, 2012. “About KFC in China”, [online] Available at: <http://www.kfc.com.cn/kfccda/about.html> Viewed: 12 Feb 2014.

KFC, 2013. “Who Can Represent KFC: Original Recipe PK Extra Crispy”. [online] Avaliable at:< http://kfcpk.qq.com/ > Viewed: 12 Feb 2014.

Kietzmann, J.H., Hermkens, K., McCarthy, I.P. & Silvestreet, B.S., 2011. “Social media? Get serious! Understanding the functional building blocks of social media”, Business Horizons, 54, 241—251.

Papasolomou, I. & Melanthiou, Y., 2012. “Social Media: Marketing Public Relations’ New Best Friend”, Journal of Promotion Management, 18, 3, pp. 319-328.

Trusov, M., Bucklin, R. & Pauwels, K., 2009. “Effects of Word-of-Mouth Versus Tranditional Marketing: Findings from an Internet Social Networking Site”, Journal of Marketing, 73, 5, pp.90-102.

Dyer, P., 2013. “The Top Benefits of Social Media Marketing”. [online] Avaliable at:< http://socialmediatoday.com/pamdyer/1568271/top-benefits-social-media-marketing-infographic> Viewed: 12 Feb 2014.

WHY LEAN STARTUP APPROACH TO CONTENT MARKETING STRATEGY IS BETTER THAN ANY OTHER

January 22, 2015

Written by Iryna Velykokhatko

INTRODUCTION

Prior to taking marketing course, I have read a few marketing-related books this fall (I am mostly referring here to “Inbound Marketing”, “All Marketers Are Liars”, “Unleashing the Ideavirus”). Having discovered a great deal of interesting information there, the most important message that I took with me was that content matters.

Regardless of simplicity, this point is definitely brilliant as it requires minimum costs, is relatively easy to implement and yields great results. However, getting into the core of this idea, it got me wondering, what actually makes good quality content, how it fits into online marketing and what strategy to undertake when implementing it?

As the field of marketing is still emerging and constantly changing there is currently no set recipe for creating good content and good strategy for it but rather some suggestions, tips and guidelines. Traditional 4P or 7P approaches do not seem to fully satisfy the need of online marketing related to content especially in the case of early stage companies. In the end it is about trial, error and effective learning – principles, as I discovered, are very much integrated into the concept of lean startup. So why not give a closer look at it and analyze whether it is possible to make a good case for successful content marketing using lean startup approach focusing on companies in the early stages of development?  

THEORY

There is no need to revert to old truth that with the rise of Internet the world has changed and so did marketing. It is important, however, to investigate the nature of this change.

For the first time technology has given consumer a chance to walk away from information that he or she does not want. Due to this we observe a huge power shift from companies to consumer brining to en end the era of outbound marketing. There will no longer be annoying phone calls, junk ads and brochures in our mailboxes or useless emails in our inboxes. Or at least there shouldn’t be (Deighton & Kornfeld, 2009). At the same time, users are starting to take maximum advantage of their power. Using existing social media platforms they are actively engaged in creation of their own content. Much of it is often related to their user experience of different brands which could be both positive and negative and consequently do a great disfavor to companies (Winer, 2009; Kietzmann et al, 2011).

Of course, current state of things alerts marketers. Loss of control over customers poses a serious threat of declining revenues in their eyes and who wants that? But, really, that’s old news. What is more compelling is emerging array of solutions to deal with the challenge brought up by this power shift.  

This is why the field of inbound marketing is becoming widely popular. This approach includes a number of interesting and engaging techniques of customer acquisition (Halligan, Shah, 2009). Content marketing is a great part of it. Recent research conducted by the content marketing institute, suggests that “content marketing is gaining traction at many companies, and some may argue that it is now mainstream. According to the 2013 content marketing research reports for B2Band B2C industries by the Content Marketing Institute and MarketingProfs, 91 percent of B2B marketers and 86 percent of B2C marketers are using content marketing. In addition, 54 percent of B2B marketers and 55 percent of B2C marketers will increase their content marketing spend in the next 12 months” (Royse, 2012).

So what is good content and what place does it take in marketing? 

According to the Content Marketing Institute (2014), content marketing is defined as “Content marketing is a marketing technique of creating and distributing relevant and valuable content to attract, acquire, and engage a clearly defined and understood target audience – with the objective of driving profitable customer action” Content varies in a number of ways. It includes texts, info-graphics, tables, charts, pictures whatnot basically. There are a number of characteristics that fit the definition of good content. For instance, Arabella Santiago (2013), content marketing advocate at Scoop.it suggests that good content is valuable, consistent and dynamic. However, according to Nguyen Quoc Binh “killing content” is interesting, inspiring and relevant (Duc Le M, 2013). Now, go figure how to create something of the sort that combines those features and on top of things satisfies the taste of my target audience and would also help to acquire new customers. 

The challenge becomes even more difficult if to add the notion of content marketing strategy. I mean, let’s say you have put a lot of effort and created, what you would call, a remarkable content. However, there is no expected positive feedback from your customers: no engagement with the content, no sharing, no leads, basically zero response. This is exactly why definition of “good content” might be a great place to start with but not enough to produce desired results. The major problem here is subjectivity. What is believed to be valuable, consistent and dynamic, aka great content, by one group might not be perceived the same way by another one. The challenge might be even more difficult for early stage startups that do not have 100% market assurance regarding their project. Therefore, to succeed one has to start with developing an effective content marketing strategy instead not only great content per se.  

What is a good strategy for creating effective content marketing?

The field of content marketing is relatively new and, therefore, there is no orthodox methodology or proper way of doing it. Traditional marketing strategies that have proven to be effective earlier such as 4Ps or 7Ps are no longer the best choice as they are not taking into consideration power shift that was discussed earlier. So no wonder that content marketing practitioners have come up with a vast array of new techniques and models based on their experience. While not all of them are researched and validated, I believe that their major contribution is in stirring the discussion which will be beneficial for further search.   

Recent publication in the Harvard Business Review on the subject of content marketing strategies by Richard Ettenson, Eduardo Conrado, and Jonathan Knowles (2013) suggests modification of 4Ps. The authors offer S.A.V.E framework that focuses on solution, access, value and education instead of traditional product, place, price and promotion. Offered change is motivated by the need to fine-tune old models based on the changes occurring in the Internet space and with regards to B2B field. In a nutshell, this approach is customer-oriented on the receiving side and holistic on the marketing side as it requires cooperation with sales department in the company (Ettenson, Conrado, and Knowles, 2013)

Another approach is offered by Pulizzi and Barrett (2009) in their recent book. They are talking about B.E.S.T. methodology for B2C markets according to which companies should use behavioral, essential, strategic and targeted, formula when approaching content marketing. Each category has a set of questions, answering which helps creating effective content marketing strategy. Examples of questions include: “How do we want our customers to feel? What effect must we achieve with them? What action do we want them to take? etc.” (Pulizzi and Barrett, 2009). 

The above approaches along with some other ones that are not covered in this paper are useful tools for online content marketing. However, I have spotted two challenges with them. First, they are static. They are useful in mapping out important questions to address for setting content strategy. However, they are not very useful in suggesting what to do next. Or what to do in case there is no desired response from the market? Of course, the answer might deem obvious – you should reconsider your strategy, ask those questions again and adjust the content based on the feedback. The problem is that it makes the process very cumbersome and costly.

The second issue is that these models are complex in their terminology and not straight forward enough. This should not be a problem for professional marketers who know their subject to the core, but this could create a problem for companies in early stages that do not have the means to afford professional marketing assistance or might not even be sure if their product/content is going to evoke customer interest.

As an addition to existing models that would help to address the above issues, I suggest to look into lean startup model and evaluate whether it could be useful.

What is lean startup?

The concept of lean startup was offered for the first time in 2011 by Eric Ries and has been gaining popularity among businesses ever since. In essence the idea seems quite obvious as it is based on early hypothesis testing. The novelty, however, is in the fact that this has not been done in business field ever before! Traditional approach to business dictates the need for thorough business plan, with well-defined marketing and financials (Ries, 2011). Unfortunately plans prone to fail especially when dealing with new and unknown and something that could not be controlled, like markets. This is exactly where leans startup approach comes in so handy.

Lean startup approach has three key principles. First, instead of engaging in complex research entrepreneurs start with a hypothesis and then write it down on the business canvas, focusing on the most essential questions. Second, it uses customer development approach. Entrepreneurs get outside to directly ask customers about product’s features, pricing, distribution channels etc. The key is to be agile and fast by employing minimum viable product concept. Based on the feedback, necessary product adjustments are implemented and hypothesis is pivoted. Third, lean startups use agile development approach working with their customers. This way they develop products iteratively and incrementally with a minimum waste of resources. (Blank, 2013).

So, applying lean startup cycle to content cycle, we the get the model presented below. What is different in this model is that it is simple, dynamic and based on constant feedback from customers. Applying this methodology allows for early hypothesis testing and correction of content based on the results which end up in producing better, more valuable and interesting content. This seems like a very obvious way of doing things, however, this is not always the case as we, as individuals, are often prone to concentrate on extensive planning and in-depth research prior to implementing something. This is not bad of course, but in the Web 2.0 where things happen with the speed of light and where customer has power dominance too much planning might be useless (Hodges, 2014).

<img src="lean-content-marketing.jpeg" alt="Baby Crying" />

Figure 1. Applying lean startup cycle to content cycle (Santiago, 2013)

Instead, according to the model, it is far more effective to research the field and see what competitors are doing and then get to content creation right away. It is important to have it out there, evaluate customer response to it, modify it based on learning experience and repeat the cycle until success formula is retrieved (Santiago, 2013). 

There are a few things about lean startup approach that I find compelling. First of all, it is quite easy and requires minimum expenses. As testing is happening in early stages it does not cost much to modify products or services. Second, lean startup approach is quite universal and therefore suitable not only for early stage companies but also for established sizable businesses. They even have an advantage here in terms of financial and human resources. Finally, you can actually get a meaningful validation of your idea through reaching out to your customers and see whether your business will fail or succeed in the future (Laurie & Harreld, 2013). These are also some of the reasons that could be beneficial in content marketing.

DISCUSSION

When setting off to write this paper, my goal was to explore an area of marketing that I have thought was rather under-searched due to its novelty. In the course of writing I have discovered much new to myself and also tried to establish the link between two different areas: marketing and entrepreneurship through investigating whether it is possible to apply lean startup methodology to content marketing strategy. To sum up, I have discovered the following:

-       The notion of good content is very subjective

-       Existing content marketing strategies are useful in mapping out important questions that should be a part of content marketing strategy but are missing dynamic component  

-       The concept of lean startup adds missing dynamic component and allows more simplistic approach to the strategy

-       In addition lean startup approach offers extra values in reduced costs and accessibility by not professional marketers 

There is still much left to the discussion on the topic in this paper. At the moment most of the information available on the topic of content marketing and content marketing strategy comes mostly from content market practitioners. Therefore, there is lack of scientific research and standardized models in the field.

References

Blank, S. (2013). Why the Lean Start-Up Changes Everything. Harvard Business Review, 91(5), 63-72.

Content Marketing Institute. (2014). What is Content Marketing? Retrieved from http://contentmarketinginstitute.com/what-is-content-marketing/  

Duc Le M. (2013). Content Marketing. Retrieved from http://www.theseus.fi/bitstream/handle/10024/62104/Duc_LE.pdf?sequence=1

Ettenson R., Conrado E. and Knowles J., 2013. Rethinking the 4 P’s. Havard Business Reviews, January/Feburary publication. 01.01.2013. http://eds.b.ebscohost.com/eds/pdfviewer/pdfviewer?vid=2&sid=1846e276-d666-4122-be79-18e30b54f31c%40sessionmgr111&hid=104

Halligan, B., Shah, D. (2009). Inbound Marketing: Get Found Using Google, Social Media, and Blogs. John Wiley&Sons, Inc., Hoboken, New Jersey.

Hodges, A. (2014, February 6). Validating Your Content Marketing Business Case Using Lean Startup Methodologies. Retrieved from http://www.stateofdigital.com/validating-content-marketing-business-case-using-lean-startup-methodologies/

Laurie, D. L., & Harreld, J. B. (2013). 6 ways to sink a growth initiative. Harvard Business Review, 91(7), 82-90.

Kietzmann, J., H., Hermkens, K., McCarthy, I., P., Silvestre, B., S. (2011). Social media? Get serious! Understanding the functional building blocks of social media Retrieved from https://liveatlund.lu.se/departments/BusinessAdministration/BUSN32/BUSN32_2014VT_50_1_NML__1281/Lists/CourseSchedule/Attachments/3/Kietzmann%20et%20al%20social%20media%20get%20serious.pdf

Pulizzi, J. & Barrett N. 2009. Get content, get customers: Turn prospects into buyers with content marketing. 1st edition. McGraw-Hill.

Ries, E. (2011). The Lean Startup: How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses. Crown Publishing Group.

Royse, 2012) (http://contentmarketinginstitute.com/2012/12/effective-content-marketing-habits/)

Santiago, A. (2013). Leaner, better, faster: More impact with your content marketing. Retrieved from http://www.slideshare.net/arabellasantiago/market-campsf-prez

Winer, R., S. (2009). New Communications Approaches in Marketing: Issues and Research Directions. Retrieved from https://liveatlund.lu.se/departments/BusinessAdministration/BUSN32/BUSN32_2014VT_50_1_NML__1281/Lists/CourseSchedule/Attachments/2/new%20approaches%20in%20marketing_Winer_2009.pdf

Threats of Brand management in social media Why Strong Social Media Presence Magnifies Brand Weaknesses and How International Brand Managers Can Address This Part 2

January 19, 2015

Written by Jenni Väisänen 

Demand for Transparency 

Strong presence in social media is a threat for brands due to the fact that all pieces of information, no matter negative or positive, ever published in the Internet, can be found conveniently and quickly with a few “clicks” (Akar and Topcu 2013). The availability of information via Internet has changed the marketing atmosphere and its rules: there are no secrets. Previously companies have been privileged to market brands and sell products to consumers without a true demand to be transparent in their messages and operations, whereas nowadays companies and brands need to be more accurate in their actions. As it seems to be, truth, no matter how ugly, will be tracked down and brought to public, and to social media. This, in turn, has a negative impact on brand equity and reputation. (Awasthi, Sharma and Gulati 2012). (Fournier and Avery 2011)

In case consumers find discrepancies in a brand’s external and internal image, its users and customers can point out their observations quickly in social media. (Awasthi, Sharma and Gulati 2012; Fournier and Avery 2011) Unilever’s famous Dove-case represents ideological differences between Dove and another Unilever-brand, Axe. While Dove fights for Natural Beauty, Axe promotes the idea of a total opposite of a Dove-woman, craving to get a piece of an Axe-man. Women in Axe-commercials are far from Dove-women in terms of their looks: they meet the standards of beauty industry. This created a wide conversation, questioning and threatening Dove’s authenticity. (Singh and Sonnenburg 2012) Pictures 5 and 6 below demonstrate the different perceptions of women between Axe and Dove. These kinds of cases, where a company’s actions are criticized can have a remarkable negative impact on brand reputation (Awasthi, Sharma and Gulati 2012).

The Dove Campaign for Real Beauty, 6 women with a "normal" BMI

Picture 5: Dove Real Beauty

(Dove U.S. Homepage 2014)

Axe Lynx Effect commercial stating "the cleaner you are the dirtier you get". Skinny blonde woman holding bikini top at its place.

Picture 6: Axe Lynx Effect (Claudiu, 2011)

Another example of brand management gone wrong is the case of BP. When the Deep Water Scandal proved that the beyond petroleum -rebranding practices were implemented not throughout the company, but only as a public relations –trick, the brand and corporate reputation were deeply criticised. (Fournier and Avery 2011) This, lack of authenticity and transparency, generated a lot of negative publicity for BP, decreased brand equity, and made the company look like a travesty of an environmentally-responsible firm (Ritson 2010).

Stand for your values

Corporate integrity is not any more dependent on the company operations only, but also on its employees and brand image. In order to establish transparency, authenticity is a key factor. To become authentic, brands need to correspond to what they claim to be, and employees must stand for the same values as the companies they work for. Hence, both product and corporate brands’ external and internal images must correspond with each other, and enhance similar values. (Awasthi, Sharma and Gulati 2012; Fournier and Avery 2011)

Constant criticism 

Consumers have become more critical, and as they are connected in social media, they also interpret brand messages and values as a mass of people. Hence, if a brand message is supported, consumers are prone to show it by “liking” or “sharing”, whereas unaccepted brands are roughly criticized web-wide. Constant evaluation of companies and their brands either work for the brands as networks endorse them, or against them as consumers share negative experiences or pure hatred towards the brand. (Fournier and Avery 2011)

Because social media enables convenient opinion and experience sharing, consumers seek reliable comments on the internet. They perceive other consumers as the most reliable sources of information. (Blackshaw and Nazzaro 2006, cited in Akar and Topcu 2013)  According to Muñiz and Schau (2007), the source of information does not have an impact on the dispersion of it: even consumers’ perceptions about brand-stories, which used to be created by brand managers only, can spread as rapidly as if they were originated by companies (cited in Singh and Sonnenburg 2012). Pitt et al (2002, cited in Fournier and Avery 2011) point out that when negative comments are published, they travel fast and reach a wide audience. Therefore, Homer’s (2008) findings about the relationship between brand image and quality encourage companies to support and protect their brands. He found out that brand image is perceived as a more important factor than the actual quality of a product. (Homer 2008, cited in Awasthi, Sharma and Gulati 2012)

As Dell and Pampers’ have witnessed, trying to control, and moreover, enhance positive brand image, requires resources and time. Dell actually created a new job position for one of its employees, in which he works as a real-time help desk, solving consumers’ problems online (Fournier and Avery 2011), whereas P&G’s Pampers, suffering of mothers’ social media accusations of causing diaper rash to their babies, remained convinced about their new product’s safety. However, it was only until a third party, Consumer Product Safety Commission, was involved to the case, when the buzz around the sensitive issue and angry mothers started to calm down. (Barwise and Meehan 2010; Geller 2010) Below, Picture 7 shows, how experiences regarding Dry Max-diapers were shared through Facebook.

Pampers Dry Max Diapers -anti-brand Facebook site; people sharing skeptical questions.

Picture 7: Dry Max Facebook conversation (Recall pampers dry max diapers! 2010)

Online word of mouth can, at its best, concentrate on promoting a brand and work as a co-operative force in enhancing the brand. However, when world-wide communities focus on attacking a brand, they generate rapid, negative, and widespread electronic word-of-mouth and hence, reputation, by reaching a large number of consumers. Especially strong brands have been associated with “anti-brand sites”, which share negative perceptions about the brand. (Awasthi, Sharma and Gulati, 2012) Krishnamurthy and Kucuk (2009) identify three reasons why specifically strong brands are threatened by communities. First, the more known the brand is, the more attention one can draw and hence, try to influence the industry. Second, as strong brands tend to dominate the market, damaging their image can cause changes in the market shares, and third, the fear of decreased brand equity can make larger companies to listen to boycotters’ requests and mission. (Krishnamurthy and Kucuk 2009)

 Learn, develop, and communicate it!

Constant criticism can, however, encourage companies to learn from their mistakes and lead to an improved brand image, which, ultimately, strengthens brand equity. By listening to consumers’ unhappiness, companies can identify constantly occurring problems with their products and find out their root causes. This can lead to improved products and more satisfied customers. Companies who have been actively communicating online about their learning processes and attempts to compensate claims, seem to be appreciated by consumers. (Fournier and Avery 2011)

Conclusion

Nowadays, strong media presence and publicity have greater than ever impact on brand equity, corporate reputation, and company profitability (Fournier and Avery 2011; Krishnamurthy and Kucuk 2009). Therefore, it is vital to know the new environment and its rules when introducing and managing brands online. As the environment allows people to form strong online communities in which they exchange ideas and experiences, negative brand image is probably one of the most horrifying issues brand managers can think of.  And managing that image is more and more challenging due to the fact that in social media, brand managers do not possess full power over their brands. There, in the jungle, also consumers own the brand and take part in creating it. By realizing the new conditions of survival, learning from others’ (and their own) mistakes, and being constantly aware of the possible consequences of their actions, brand managers can not only survive at the era of online marketing, but also manage their brands successfully, together with consumers.

REFERENCES

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Pictures:

Adweek – Advertising & Branding. 2013. Low Self-Esteem Is Not a Problem in Dove’s Real Beauty Sketches … for Men [online]. 18 April. Available at: <http://musicvalleygroup.com/2013/04/18/low-self-esteem-is-not-a-problem-in-doves-real-beauty-sketches-for-men/> [Accessed 9 February 2014].

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Threats of Brand management in social media Why Strong Social Media Presence Magnifies Brand Weaknesses and How International Brand Managers Can Address This Part 1

January 15, 2015

Written by Jenni Väisänen

Nowadays, brand managers focus more and more on marketing online, due to the multiple opportunities it offers. However, to manage brands efficiently in social media settings, marketers need to understand the rules of their new marketing environment. This paper examines survival tactics of brand management in social media in the form of literature review. Based on Fournier and Avery’s article (2012) about the evident characteristics of social media and their impact on brand management practices, this paper discusses four factors, which can threaten brand management by magnifying their weaknesses, and ways to overcome them. The factors are characteristics and demands which have risen at the era of online marketing. They are 1) power of social collective, (2) entertaining parodies, (3) demand for transparency, and (4) constant criticism. Depending on the way these characteristics are addressed by brand managers, they can work either as an endorsement or threat to branding practices in social media.

Introduction

Today, being present in social media is necessary for most companies, as it provides possibilities to connect and create relationships with various groups of stakeholders. Intensive use of Web 2.0 technologies in marketing pays off, as it has a remarkable impact on company reputation, profitability and market share, when properly implicated. (Bughin and Chui 2010; Kietzmann et al 2011) Because web 2.0 is regarded as a door-opener for two-way communication and information sharing (Filho and Tan 2009, cited in Akar and Topcu 2013), including it to the traditional marketing mix provides various new platforms for marketing activities (Winer 2009). Akar and Topcu (2013) define social media marketing simply as a tactic to promote both company and its brands via different social media channels, such as Facebook, Twitter or Youtube.

Despite the opportunities social media marketing has to offer, brand managers need to realize that there is a thin red line between success and failure, when a brand is presented in social media. Rapidly spreading electronic word of mouth (Akar and Topcu 2013), powerful consumer activism within online communities (Cova and Pace 2006), and co-creation process of brand image (Singh and Sonnenburg 2012) do not run only with positive energy. If brand managers lack understanding of vital rules in the jungle of social media marketing, strong brand presence and visibility can turn into a threat for the brand. Negative brand reputation spreads fast in social media, which can have serious impact on sales and even survival of a company (Kietzmann et al 2011). As the prerequisite of social media is that it was created for people – not for marketers nor brands- companies should be aware that they are to walk on their toes in the online jungle. (Fournier and Avery 2011)

Fournier and Avery (2011) summarize four phenomena in social media, which brand managers ought to take into consideration when marketing online. They are (in other words than Fournier and Avery, 2012, presented) (1) power of social collective, (2) entertaining parodies, (3) demand for transparency, and (4) constant criticism. As social media has changed the landscape of marketing practices remarkably, resulting in “traditional” marketing techniques becoming invalid, it is important for companies to understand conditions of their new marketing environments (Awasthi, Sharma and Gulati 2012).  These phenomena, help to clarify the root causes of the benefits, without forgetting the threats, of having strong social media presence. (Fournier and Avery 2011)

Purpose of the study

The purpose of this paper is to understand, why social media as a marketing landscape is challenging for brand managers. The aim is to encourage learning from others’ mistakes, and discuss some ways to address the dilemmas. This paper is divided into two parts; in the first part, focus is to discuss the power of social collectives and parodies, whereas the second part concentrates on how companies should handle demands to be transparent and constant criticism.

Magnifying and managing brand weaknesses: need for belongingness and entertainment

Power of Social Collective 

Social media answers to peoples’ need of being accepted and feeling the sense of belongingness through its various communities, virtual friend-making and social bonding. By “liking” their friends’ updated statuses and “joining” different groups, people connect with each other conveniently. Online communities offer a place for like-minded people to share their opinions, photos and experiences, which enhances the feeling of belongingness. (Fournier and Avery 2011) Picture 1 below demonstrates, how many people Nike reaches via Facebook.

Nike Facebok coverpage, with 16,508,118 "likes".

Picture 1: Nike social media –Facebook (Nike 2014)

Marketers have traditionally been able to bring brands and their messages to the awareness of consumers, possessing full control over the message, but social media has changed this. Today, managers are creating their brands together with consumers by sharing experiences and opinions. Because this new type of branding process is dependent on consumers’ opinions and perceptions of the brand image, managers need not only to listen carefully what their customers are saying, but also engage consumers into the co-creation of their brands. This two-way communication has changed the ideology of branding online completely. (Corstjens and Umblijs 2012; Fournier and Avery 2011; Singh and Sonnenburg 2012) 

The fact that consumers may connect different characteristics to a brand than the previous owner, brand manager, can cause problems to the company and threaten the brand image (Fournier and Avery 2011, Corstjens and Umbljis 2012). Singh and Sonnenburg (2012) suggest that instead of trying to control the brand message too much, brand managers should concentrate on guiding consumers’ comments to support and endorse the original brand-story. According to Singh and Sonnenburg (2012), some corner stones of the new way of brand management are to switch focus to the process instead of the output and understand the role of “tension” in brand-creation.

Switch focus to the process, not to the output

As the core idea is to co-create brand-stories together with consumers, they need to be encouraged to participate into the process. Brand managers need to accept that brand image will be affected by different kinds of experiences and stories shared by individual consumers, which, in other words, means that there is no “one storyline” or “one image” of a brand. What brand managers can and should try, is to guide shared comments to reflect the desired brand concept. This can be done by e.g. engaging, provoking and seeding. Engaging can be done by encouraging different opinions and by challenging new stories, whereas provoking by addressing emotional topics for discussion. Seeding is a tactic to encourage co-creation in multiple social media platforms (Shau, Muñiz, and Arnould 2009). Additionally, brand managers should provide a suitable social media platform for consumer-discussions. (Singh and Sonnenburg 2012)

Realize the role of “tension” in branding

In order to activate consumers to participate in branding, marketers must provide tension to the story. Tension as a concept has been divided into three categories: internal, personal and external. Internal tension rises from the need to look into the mirror and identify oneself, whereas personal tension lies in the differences between people. By external tension, the issues between people and their environment, nature and even supernatural, are brought up to discussion. When holistically practiced, all sources of tension are discussed in a brand co-creation process. Hence, tension is the driving force to generate consumers’ emotional engagement to the brand story. (McKee 1998, in Singh and Sonnenburg 2012) Below, in Picture 2 it is visible how Ben&Jerry’s Icecream creates tension at their Facebook site: they promote well-being of cows and ask, which flavour their consumers prefer on “Belly laugh day”.

Ben&Jerry's ice-cream highlighting the importance of happy cows and asking flavour preferences, i.e. creating tension.

Picture 2: Ben&Jerry’s social media -Facebook (Ben&Jerry’s 2014)

The curse of co-creation is that it makes branding uncontrolled: if consumer societies’ opinions collide with brand’s mission or values, solving the emerging problems can be challenging. (Fournier and Avery 2011) A good example of a mismatch between consumers’ and brand managers’ perceptions of a brand is Frito-Lay’s: brand managers enhanced environmentally-friendly values in product development, whereas consumers considered “convenience” as a more important factor. The brand had to give up its ecological packaging material in order to meet customer wants: a package with less-rasping sounds. (Brady 2010, cited in Fournier and Avery 2011)

Entertaining parodies

Yet parodies about brands are not a new invention, spoofing has emerged as a form of entertainment in social media. Parodies about different brands and advertisements have become normal in different social media platforms, such as Youtube. Previously parodies were distributed mainly by professionals, but nowadays anyone can entertain others in social media. In general, brands and advertisements offer a variety of themes to make fun of. (Fournier and Avery 2011)

The Dove Beauty 'Sketches' ad has been parodied in terms of men's face. Sketches are completely different as men see themselves as more attractive than they are.

Picture 3: Dove sketches parody –men. (Adweek 2013)

When consumers use parody in order to attack a brand and in order to humiliate it, it is time for brand managers to get restless. Rude parodies concerning the core values and positioning can be particularly damaging for any brand. (Fournier and Avery 2011) After Dove’s Real Beauty campaign was launched, some parodies were uploaded into Youtube. They were made about men, with the same idea as “sketches”-video: men were drawn on the basis of their description about themselves, and then, on the basis of another person’s description. The descriptions concerned, depending on the spoof, their faces or their testicles. (AdhocVids 2013; Irakli Kopaliani 2013) Pictures 3 and 4 demonstrate the two parodies.

The Dove Beauty 'Sketches' ad has been parodied to put testicles front and center.

 Picture 4: Dove sketches parody –testicles. (Ma, 2013)

    Be fun if you can –and if not, know your audience

If the brand identity supports the idea of being funny, some marketers themselves can use the idea of silliness and implement “parody” as a selling tactic before consumers do. Indeed, there are some brands who sell by being funny, such as Blendtec. Even though the idea of a kitchen blender is not entertaining, commercials made it funny by blending almost anything. (Fournier and Avery 2011) However, if the brand image does not convert into a funny story, brand managers should realize that their online marketing activities can reach anyone. Even though target group is defined, social media allows other people, who do not even consume the product, share their point-of-views and therefore, have an impact on the co-creation of the brand. (Singh and Sonnenburg 2012)

Demand for transparency and constant criticism are discussed in part 2.