Brands, social media, ROI, social business, measurement, performance, community management, brand strategy, humanity

1. Brands: The Cost of Being Human
@jenvandermeer
EVP, Services Dachis Group
SXSW, 2012
#SXhumancost

2. A Story in 3 Acts:
1. Brands
2. The Cost
3. Of Being Human

3. I calculate ROI in my sleep

4. BRANDS

5. I was talking to some social
business executives a few days ago

6. and a few nights ago

7. what does your company’s social
business budget look like?
Informal survey over cocktails of 10 Fortune 500 consumer brand marketers - median

8. what does your company’s social
business budget look like?
Staff to manage
Tools
4% 7%
Custom Development
7%
Agencies
Media 10%
Commerce
2%10%
15% 12%
39% 60%
11% 10%
31%
21%
24%
26%11%
2010 2011 2012E
$Small $Still small Still only 1% of total
marketing spend
Informal survey over cocktails of 10 Fortune 500 consumer brand marketers - median - not statistically significant.

9. Staff to manage
2010 2010 2012E
1.5 FTE 3 FTE 7-8 FTE
Informal survey over cocktails of 10 Fortune 500 consumer brand marketers - median - not statistically significant.

10. paid media to drive social efforts
2010 2010 2012E
$Rounding $See what Becoming best friends
error you can do with my Facebook rep
Informal survey over cocktails of 10 Fortune 500 consumer brand marketers - median - not statistically significant.

11. Staff/media: the olive ratio
2010 2010 2012E
Informal survey over cocktails of 10 Fortune 500 consumer brand marketers - median - not statistically significant.

12. This sets up a conflict
vs
Informal survey over cocktails of 10 Fortune 500 consumer brand marketers - median - not statistically significant.

13. This sets up a conflict
social
business vs cmo
team

14. This sets up a conflict
social
business vs cmo
team

15. This sets up a conflict
Cluetrain vs Madmen

16. This sets up a conflict
Authentic vs Reach!
Conversation!

17. This sets up a conflict
Give me Get me more
vs
headcount! fans!

18. This is a false conflict.

19. To re-connect the
brand back to the
people, we’re
going to need to
align the vision
Dave Gray’s sketch

20. Branding didn’t start here.

21. It started here.

22. And then HERE.

23. Oh, and here.

24. “When it rains, it pours.”
Which “It’s toasted.”
created a “A diamond is forever.”
need for
THEM... “Reach out and touch someone.”
“Be all you can be.”

25. and THIS...

26. Whenever there’s
an advancement in
technology...
...someone figures out how to use that
technology to stimulate the economy.

27. and we
tried. so
very hard.

28. and we stepped on
each other’s toes.

29. and we got
into false
arguments.

30. but then the
business value was
found.

31. But the revolution did
NOT actually happen.

32. Because we are still stuck.
In HERE.

33. but this this happened...

34. and then THIS!!!!!!!

35. SO great.

36. the market moved from here
14th Street and 9th Avenue 1911

37. to here in 100 years
14th Street and 9th Avenue 2011

38. and back again
14th Street and 9th Avenue 2011

39. so how
do we
talk

40. to all of these people.

41. The
COST

42. But I still want to know....
How do I get more
headcount.
I’m tired.

43. But that’s
not the
point.

44. 2 Case Studies:
_ Small business
_ Complex global multibrand jumbocorp

45. The following numbers are imaginary, for illustration purposes only.
please do not quit your day job to start a mutton honey truck or any
food truck without doing a thorough ROI analysis.

46. Food truck social business ROI inputs
Time frame: 2008 - 2012
Food Trucks: 1
Employees: 1
% FTE dedicated to social media: 10%
Cost of employee: $14k first year, increasing 3%
every year but really am much more fulfilled
Investment in social media: 1 iPhone which lasted
for 5 years and never fell into the deep fryer

47. Social data
Twitter > Bit.ly Clicks Foursquare Redemptions
1500
1125
750
375
0
2008 2009 2010 2011 2012

48. Incremental Revenue Per Year
Incremenatal Revenue
15000
11250
7500
3750
0
2008 2009 2010 2011 2012
Value of each Foursquare redemption: $60 yearly share of wallet + average one
additional customer referred who had a $60 yearly spend

49. ROI calculation
Year 0 2008 2009 2010 2011 2012
Revenue $480 $720 $1920 $5400 $1440
iPhone Cost -$400
Costs x Year -$1400 -$1540 -$1694 -$1864 -$2050
Profit x Year -$920 -$820 $226 $3537 $12350
$14373 - $400 = $13973
= 35X ROI!!
$400

50. What did we learn
Worfklow to capture ROI data
Value is not the individual transaction level but the
longer term spend, and referral value
ROI does not kick in until scale accelerates
But... there are limits to growth

51. Case 2: Big
Multinational
Brand

52. Bigger staffs #FAIL
You can’t staff into capitalizing on engagement @ scale
#FAIL
11
+ 33
= .37
+ .25
Deleted slides here on cost of command centers -
Contact directly to talk about how to think about this.

53. BRANDS:
THE COST
OF BEING HUMAN

54. WE CARE ABOUT THIS
BECAUSE

55. “Fans”
spend $72
more on products than “non-fans”
Syncapse 2010

56. People who follow
brands on
Facebook are
51% more likely to buy a product
post-connection.
60%
more likely to recommend
a product post-
connection.
Constant Contact and Chadwick Martin Bailey 2011

57. People who
follow brands
on Twitter are
67% more likely to buy a
product post-connection.
79%
more likely to recommend
a product post-
connection.
ROI Research for Performance, June 2010

58. PRE-INTERNET:
BRAND BUILDING
All about meaning.
Unreliable measurement.

59. INTERNET: PRE-INTERNET:
MEASUREMENT BRAND BUILDING
Direct response model. All about meaning.
Metrics, but less meaning. Unreliable measurement.

60. SOCIAL:
MEANING AT SCALE
The best medium for measurable brand
expression.
Companies that are active in social
perform better than those that are not.

61. By giving And now, we
By finding advocates can measure
advocates interesting the impact of
things to advocacy
do, together
At scale

62. What will we see when we look at the
social data?

63. Great brands grow because they
connect deeply with people
Brands as diverse as Method, Red Bull,
Lindt, Petrobas, Samsung, and Zappos –
were built not just on innovative product
or service ideas but on IDEALS
Millward Brown Stengel Study on Business Growth Jan 2012

64. Top 50 brands pursue
fundamental human values
that improve people’s lives:

65. 1. Eliciting Joy: Activating experiences of
happiness, wonder, and limitless
possibility.

66. 2. Enabling Connection: Enhancing the
ability of people to connect with each other
and the world in meaningful ways.

67. 3. Inspiring Exploration: Helping people
explore new horizons and new
experiences.

68. 4. Evoking pride: Giving people increased
confidence, strength, security, and vitality.

69. 5. Impacting Society: Affecting society
broadly, including by challenging the
status quo and redefining categories

70. Where do I get my headcount? Wrong
question.
It’s time for us to become performance
brand markters.
To reconnect the brand back to ourselves.

71. THANK YOU.
@jenvandermeer
#SXhumancost