Last week, I was pointed in the direction of an article entitled: “Online Social Media Cheap Alternative In Face Of Recession”.

It describes how Forrester Research is advising marketers to “spend more on online social media as a cheap, efficient way to advertise during tougher economic times.”

Given the fact that it’s increasingly becoming clear that marketing on social networks is ineffective for the vast majority of marketers who have tried it, and is losing money for even the Googles of this world, Forrester Research’s ‘research’ seems to be quite contrarian to say the least.

The kool-aid sippers at Forrester provide three rationales for their recommendations.

  • Rationale 1

“Well-designed social applications are effective. Social programs leverage the voice of the customer to get messages carried further than ad impressions. If your message resonates with consumers, their word-of-mouth is a more effective medium than any of the traditional media.”

The idea that brands are having consistent success leveraging social media to get their “messages carried further than ad impressions” is a myth in my opinion.

Word-of-mouth is not necessarily synonymous with social media. That is, just as with any other form of marketing, there is no guarantee that consumers are going to take your message and carry it on.

The message and the product, not the delivery mechanism, are the primary factors in determining whether an ad campaign goes ‘viral’.

I discuss word-of-mouth in the context of social media marketing when discussing Rationales 2 and 3 below.

  • Rationale 2

“They’re cheap. Advertising campaigns often run into millions of dollars. But Facebook pages and blogs are two examples of social programs that you can start for next to nothing. Even more sophisticated programs like a full-blown customer community typically don’t cost more than $50,000 to $300,000 to get going.”

Perhaps there’s a reason that social media marketing campaigns are cheap.

If they were delivering great results, you can be sure that the costs would reflect that. MySpace and Facebook aren’t charging rock-bottom rates because they’re altruistic.

As it stands now, the paltry results from social network ads provide a more likely explanation for the cheap costs - if these companies charged more, they wouldn’t be able to sell advertising.

I’d love for Forrester to explain how a Facebook page or blog is going to drive results for brands that do billions of dollars in revenues every year.

If you have a small business that did $20,000 in revenues last year and can find a way to leverage social media marketing to increase your revenues to $30,000 this year, that’s great.

But when talking about consumer brands that are doing billions in revenues annually, it’s naive to assume that attracting even 10,000 ‘fans’ or ‘influencers’ is guaranteed to have any noticeable impact on the bottom line.

I also question the value of having a ‘full-blown customer community’. Even though a major brand can drop $50,000 to $300,000 without hesitation, just what does the brand really receive?

Forrester seems to focus on cost while ignoring value. As anybody with half a brain knows, low cost does not always equal high value.

Is it not better to spend $2 million on a campaign that delivers results than to spend $200,000 on a campaign that doesn’t? Let’s take a global beauty brand’s ‘community’ on Facebook as an example. According to Wikipedia:

“Make-up Art Cosmetics, better known to most as MAC, is a brand of cosmetics sold internationally, that originally became famous through word-of-mouth endorsements by professional makeup artists, models and celebrities.

“The company has become synonymous with glamour due to its ever-growing presence in the fashion industry, continued use of celebrity endorsements and commitment to cruelty-free products and universal diversity.”

The company now has a community on Facebook:

The MAC Cosmetics Facebook community is a good case study for social media marketing.

When looking at the screenshots above, it’s clear that the audience is far too small to be of significant benefit to such a brand and, most importantly, there is very little ‘conversation’ going on (32 wall posts, 1 discussion topic, etc.). The ‘conversation’ that is taking place doesn’t have a whole lot of substance (i.e. “my fav. cosmetic”).

In general, this is fairly representative of what I’ve seen with the communities and pages other brands operate.

This is not to say that MAC Cosmetics does not have a respected brand that its consumers are passionate about.

What I will say, however, is that it’s very difficult for brands to get consumers to engage around their brands online on a regular basis in meaningful ways, especially when the ‘venue’ is controlled by the brand.

After all, you may love MAC Cosmetics, but are you really going to spend hours every week talking about MAC Cosmetics, especially on Facebook?

There’s no value in doing so. Therefore, the idea that social media marketing campaigns are going to turn consumers into online brand zombies is ridiculous.

Ideally, your brand plays a role in a consumer’s life, but thinking that your brand is the consumer’s life is just plain stupid.

I think far too many people involved with marketing (in all realms) forget this. Yes, consumers may love your products, but at the end of the day, toothpaste is toothpaste.

You just can’t form deep personal relationships with consumers around many, if not most, products.

As noted on Wikipedia, MAC Cosmetics grew into a successful business primarily because of word-of-mouth endorsements from celebrities and industry professionals.

This took place long before social media existed and it highlights a point I recently made:

“The truth is that great brands don’t need to pay social media marketing “experts” to cultivate legions of consumers who recommend their products to their friends and family.

“Word-of-mouth existed well before the internet; social media marketing “experts” who try to represent that they have some sort of formula for creating it certainly didn’t invent it.

“A great product, a great value proposition and a great story (with the means to get it out) are what brands truly need to cultivate word-of-mouth buzz. A social media marketing “expert” can’t create these out of thin air; bullshit artists are only required when a brand lacking those things is looking for some hot air.”

A stealthy social media marketing campaign on MySpace or a community on Facebook isn’t going to get influencers talking about MAC Cosmetics. Great products and a business model that invests people in the MAC Cosmetics business will.

  • Rationale 3

“They motivate consumers in the middle of the funnel. Social applications like discussion forums are better than advertising at helping people in the consideration phase when they’re on the fence about purchasing. In a recession, improving consideration will be more cost-effective than blasting awareness messages at resistant consumers.”

Again, the ‘discussion forums’ that are run by the brands themselves look a lot like the Facebook ‘discussion forum’ for MAC Cosmetics - empty.

I will not argue that consumers don’t increasingly use the internet to research products and services before making a purchasing decision.

They obviously do. The problem is that, pragmatically, there’s little room for brand involvement in the discussions Forrester is referring to.

If a brand offers a quality product, some consumers will naturally sing its praises (and often recommend it to their friends). If a brand offers a product that consumers aren’t satisfied with, it can expect negative comments.

In other words, the best way a brand can promote and influence the ‘conversation’ is at the product-level - successfully introduce the market to a great product and there’s a good chance that the product itself will help cultivate consumer passion.

It’s nearly impossible to engage in a ‘conversation’ that subtly persuades consumers to love a product they aren’t satisfied with and there’s no ‘relationship’ to be cultivated with consumers if your product truly isn’t compatible with their needs and desires.

This underlies the admittedly crude analogy I made about what marketing really boils down to:

  • I make a product that I think is great.
  • I identify targets who I think need or want this product.
  • I approach those targets and, using a variety of techniques, attempt to demonstrate to them that my product is great and should be purchased.
  • If I can’t convince those targets that my product is great after reasonable attempts, I should move on to other targets. If I can’t convince enough targets that my product is great, I need to re-evaluate the viability and/or appeal of my product.
  • If I can convince those targets that my product is great and they become buyers, I do my best to ensure that those buyers continue to buy my product. Depending on the product, this can be done in a number of ways which are outside of the scope of this post. In some cases, however, it may be difficult to build a “relationship” with my buyers (i.e. if I sell toilet paper it’s unlikely that consumers are going to become evangelists for my product even if they really do like how soft my tushy tissue is).

At the end of the day, it really isn’t much more complicated than this. Those who try to make it more complicated are either asking for a hernia or a lot of money.

Conclusion

As I read Forrester Research’s article, I couldn’t help but think that the firm is basically forced to offer recommendations that just don’t make sense.

After all, Forrester Research is one of the research firms that has hyped social media the most.

Example 1 – its $279 2006 ‘Social Computing’ report went so far as to state that:

to thrive in an era of Social Computing, companies must abandon top-down management and communication tactics, weave communities into their products and services, use employees and partners as marketers, and become part of a living fabric of brand loyalists”.

Example 2 - its $250 Strategy For Facebook, A Ready-Made Marketing Platform teleconference. It is not unreasonable to say that Forrester Research’s credibility in claiming to be a provider of “pragmatic and forward-thinking advice” is on the line.

So it’s taking the Bush Administration approach - even though the quantitative data shows that social media marketing isn’t delivering the hoped-for results and big proponents (such as Google) are admitting that it hasn’t panned out quite as expected, Forrester Research will continue to tout fanciful claims and hope that people continue to believe them simply because they keep hearing them.

Fortunately,
not all brands are drinking the kool aid. My internet company recently signed a deal with a $500m/year consumer brand and as part of this deal, we’re implementing several online marketing initiatives for them.

Several of the proposals on the table included social media campaigns similar in nature to what some of their competition has implemented. The response? The brand is not interested in standard ‘user-generated content’ initiatives (the word ‘cheesy’ was used several times).

Not only does the brand’s marketing team feel that these no longer offer anything unique and compelling, but the team feels that consumers are very smart and aren’t going to be easily lured into engaging with the brand in a meaningful way unless something of real value is offered.

Obviously, this is only one company, but I think it does highlight the fact that some brands recognise that they have specific objectives and that these aren’t going to be achieved using standard fare social media marketing campaigns.

Instead of being convinced that they need to change their objectives (or forget about the notion of ROI altogether), they’re focusing on coming up with initiatives that do have a real chance to achieve their objectives.

You may not be as sceptical of the information that comes out of research firms like Forrester as I am, so I will make a recommendation of my own: instead of spending $279 on a Forrester Research report about social media marketing, take $279 and advertise your product or service on Facebook.

Good luck!