Social Interactions Affect Brand Perception

If brands want to improve their customer perception, having a well-rounded social communications practice that serves both as a marketing outlet and as a place for consumers to solve service issues will help.

In a new study, J.D. Power and Associates measured consumer experience working with companies through their social platform for both marketing (such as receiving a coupon or some other offer through a social channel) and service (such as answering questions about a product or service or solving specific problems) needs.

The study was based on the responses of more than 23,000 consumers and covered 100 brands in six industries: airlines, auto, banking, credit card, telecom and utility. The bottom line: very few companies doing both marketing and service particularly well.

Hardly any companies are doing equally well on social marketing and social servicing,” Jacqueline Anderson, director of social media and text analytics at J.D. Power, tells Marketing Daily. The discrepancy, she says, has a negative impact on brand perception.

The study found a correlation between a company’s overall social communications and a consumer’s likelihood to purchase and overall perception of the company. Among highly satisfied consumers (those with satisfaction scores of 951 or higher on a 1,000-point scale), 87% said their online interaction with the company “positively impacted” their likelihood of purchase from that company. Meanwhile, 10% of consumers with low satisfaction scores (less than 500) said their experiences with a company’s social communications “negatively impacted” their likelihood of purchase.

According to the study, nearly a third of consumers ages 30-49 and 38% of those over 50 interact with companies via social marketing (compared with only 23% of consumers 18-29). However, 43% of the younger demographic use the channels for social media interactions, while only 18% of those over 50 do.

Understanding exactly which consumers are using social media channels to what end will go a long way in helping companies improve their overall communications, Anderson says. Companies will have to evaluate how consumers are using their social media channels and then develop a strategy to address those patterns. This may require some of them to reorganize.

“It’s kind of a failure to understand why consumers are reaching out,” Anderson says. “Many companies are still organized around servicing on one side and marketing on the other.”

Among the industries evaluated, the auto industry is the only one that performs particularly well when it comes to marketing and servicing via social media. The wireless industry scores well when it comes to social servicing interactions, while utilities perform well in social marketing.

Companies’ Approach to Advertising on Social Media

Since the arrival of social media platforms, companies have tried to figure out how to best use them to get their messages to consumers, often with mixed results. Some brands have embraced the notion that social platforms like Twitter allow constant interaction, for better or worse, with their customers.

Others have turned away from some strains of social media, as General Motors did last spring when it stopped advertising on Facebook while raising questions about the return on its investment. The move had a ripple effect in the advertising world, with many brands questioning whether the costs of being on social media were worth it.

A new report issued Tuesday by Nielsen and Vizu, a research company owned by Nielsen, shows that brands think they might be turning a corner, specifically when it comes to paying for their use of social media.The report examined the opinions about social media marketing among more than 500 digital media professionals — including brand marketers, media agencies and advertisers — from September to October 2012.

The study found that that

  • 89% of advertisers continued to use free social media products. Nielsen did not release the names of specific social media platforms mentioned by the respondents, but they are likely to include Facebook and Pinterest, as well as Twitter.
  • 75% of the companies surveyed said they were also spending more for social media content, which could include paying bloggers to write posts about a product or using third-party technology to push videos on to the Web in the hope that they become viral.
  • 70% of the advertisers surveyed said they dedicated up to 10 percent of their budget to paid social media advertising, while 13 percent dedicated more than 21 percent of their budget. Those numbers are expected to increase in 2013.

The results come as companies like Twitter and Facebook are making more diverse advertising options available to brands. Last year, Twitter announced a number of advertising and media initiatives, including a survey product that enables marketers to ask Twitter users a handful of multiple-choice questions. Facebook began testing a new advertising mechanism using a technology called real-time bidding, which allows advertisers to place bids on ad space at specific times.

“Advertisers are starting to look at social media as an integrated part of their advertising strategy,” said Jeff Smith, the senior vice president of product leadership for advertising effectiveness at Nielsen.

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Across Channels, Retailers Push to Keep Customers Happy

The rise of the internet has meant big changes for customer service, according to a new eMarketer report, “Multichannel Customer Service: Best Practices for Building Retail Loyalty.” Consumers today have an array of digital customer service tools at their disposal, the newest of which include live chat, social networks and smartphones.

 

And the stakes are high for retailers trying to keep up. Consumers are quick to punish retailers that do not meet their customer expectations—and reward those that do.

Findings from a Q1 2012 study by the Temkin Group, a customer experience research and consulting firm, showed that customers are loyal to businesses that provide good customer service. Some 86% of survey respondents who reported being very satisfied with their most recent customer service interaction with a company were likely to repurchase, as opposed to only 9% who said they would likely purchase again after being very dissatisfied with their customer service experience.

et another benefit of good service is that satisfied customers become brand advocates who refer other people to the company. A 2012 American Express study found that 48% of internet users told other people “all the time” about a good customer service experience with a business. The survey also found that people were roughly as likely to share their poor customer service experiences.

But consumers have different expectations and preferences for customer service depending on where they are in the purchase journey and the types of questions they have. A 2012 global customer experience study sponsored by Capgemini found that social media was most important in the awareness stage (learning about products and promotions), while smartphones were most valuable in the delivery and after-sales care stages.

Most top 50 Brands Not Social

Old habits die hard:  most top 50 brands not social

The more things change, the more they stay the same, 15 years ago, brands had static websites and a unique way to interact with their followers through email or phone, what did they do?  They remove phone numbers, addresses and email from their websites.

Fast forward 15 years, in the social media era, most brands have not changed.  reminiscent of their old ways, they block followers from initiating conversations and/or only allow them to respond to posts.

In short, brands are still afraid or at best awkward when it comes to one on one communication.  They are still stuck in their old broadcasting ways, using social media as a one way communication tool.

According to an A T Kearney study, out of Interbrand’s Top 50 Global Brands on Facebook,

  • 27 of them won’t even reply directly to their customers
  • 20 of the 50 companies have a 4:1 company to customer ratio of posts on their Facebook pages.
  • 71% of the company posts were promotional
  • Only 5% of all posts actually sought to create real conversation with their customers
    Companies as consumer-facing as Disney, McDonald’s, and Sony only allow posts that were created by the companies themselves
  • Only one of the Interbrand Top 50 routed fans to an unfiltered Facebook wall, while the other 44 initially choose to show consumers and fans a filtered selection of company posts only.
  • Of the more socially engaged companies, 25 companies in our study had consumer-to-company post ratios in the 3:1 range—three consumer posts for every one company post. These companies include Coca-Cola, BMW, eBay, H&M, Kellogg’s, Pepsi, Heinz, ZARA, NESCAFÉ, Nintendo, Amazon.com, Nokia, Honda, Gillette, Philips, HP, Samsung and L’Oréal Paris. The remaining 20, however, demonstrated nearly a 1:4 ratio between consumer and company commentary.
  • Only 5 percent of company-to-consumer posts engaged consumers in discussions, while 71 percent of posts were promotional

Most traditional marketers are still not comfortable engaging consumers one on one and default to their traditional ways.  they are afraid to lose control of their message and brand and do not understand the dynamics of social media and as a result, budgets may not be available to hire dedicated social media staff or dedicate employees to interact with consumers.

Most brands consider social media to be exclusively a marketing tool and lose sight of the value social media conversations bring to other departments like customer service, R&D, quality, HR to mention only a few.  As such, social media can considerably cut customer service costs, development time, correct product or service defects faster, attract valuable talent in a more cost effective way and fail to include these savings and/or revenue generation in the overall ROI

Can you teach an old dog new tricks, sometimes, but past behaviors and trends are not exactly encouraging most top 50 brands succeed at generating “likes” and followers but fail at social engagement and miss out on the real value of social media.

Social Media Influencial in Food Decision

According to a new survey by eMarketer, social media influences purchasing decision when it comes to food:  36% bought a new brand after seeing a close friend’s recommendation, 30% after not so close friend recommended it, 20% after they saw products highly rated by users in their network and 17% after they read highly rated reviews from people they do not know

Leading Sources that Influence US Internet Users

In addition, the survey shows that when it comes to food, users are primarily sharing two thing: photos and recipes.

A May Blogher survey shows that recipes are one of the most sought-after pieces of food content online with 89% of internet users interested in food content going online for recipes.

Ina another survey, Allrecipes.com found that 65% of females who regularly used recipe sites bought branded ingredients called for in the recipes at least sometimes. 21% said they “usually” did this.

In yet another May survey, Compete found that food was by far the leading topic category for interactions on Pinterest leading to conversion.  25% overall had bought a product after discovering it on Pinterest, and surprisingly, considering Pinterest’s reputation as a female stronghold, 37% of male users were spurred to buy, compared to just 17% of female users.

US Female Bloggers* vs. Internet Users Who Go Online for Select Food-Related Content, May 2012

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Visual outperforms text when it comes to social media engagement

According to a new study from M Booth and  Simply Measured, visual content is not only taking over the digital and social media landscape, it’s also outperforming all other mediums when it comes to engagement!

  1. Videos are shared 12X more than links and text posts combined on Facebook
  2. Photos are liked 2X more than text posts on Facebook
  3. 48% of all Tumblr posts are photos.
  4. On YouTube, 100 million users are liking, sharing or commenting on videos every week.
  5. Pinterest refers more traffic than Twitter, StumbleUpon, LinkedIn, and Google+ combined
Graphics and videos drive engagement in social media

Reviews Are Key To Build Consumer Trust

Gaining consumer trust is an important issue for marketers seeking to ensure that they’re not scaring prospective customers away. In fact, a March to June survey of US adults conducted by About.com found that 84% of respondents felt that brands needed to prove themselves trustworthy before they would interact with them or other information sources. Moreover, the study found that there were 10 primary trust “elements,” or cues, that brands must establish in order to engender trust, including accuracy, expertise and transparency.

In a social media context, customers wanted to see that brands had a significant number of positive reviews, and that they didn’t go out of their way to hide the negative ones. The survey found that 41% of respondents said the ability to see reviews on social networks added to their feeling of trust in a brand. Reviews played a bigger role in cultivating trust than seeing that friends had “liked” or recommended a brand, or that the brand had accumulated a large tally of “likes.”

Video was found to improve trust the most when it served as a complement to other types of content. This ties back in to consumers’ hunger for useful information. Brands can build trust with potential customers by demonstrating expertise through quality owned content that is also devoid of a hard sales message.