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Why Social Media fails to impress the C-suite

As companies have witnessed a change in their customers’ purchasing behaviour and a fragmentation of the media landscape, they are not only rethinking the way they interact with their customers, but also how they organise. In line with these changes, involvement in social media is becoming the norm.

Written by: 
Nils Koch Jensen, Partner

To master these new media, we have seen companies introduce extensive planning processes and content calendars, and purchase expensive software tools to track and analyse their social media efforts. They have also hired social media managers and external agencies. The investment in time and money is extensive.

Despite this considerable social media outlay, they often fail to secure a return. The primarily reason for this is the huge gap between the commercial priorities and the output of these channels.  

Together with our colleagues at Kunde & Co, we have over the last three years helped some of Europe’s largest companies use social media as a business driver. We have conducted a wide range of social media audits and had the opportunity to discuss these with executive stakeholders. In doing so, we have scratched below the glamour and glory and uncovered some worrying tendencies, false truisms and strategic shortcomings. We have gathered our experiences around five key areas and devised a plan for how they should be addressed:

  1. Strategic direction
    Frequently, a company’s social media presence comes from a campaign idea or is initiated by a social media enthusiast. Despite good intentions, such uncoordinated debuts often lead to entirely explorative approaches where interactions and content availability define the path ahead. This loose method is far from ideal.
    Before embarking on any social media adventures, it’s essential to outline your channel, content and target group strategy. This is not an easy exercise and demands meticulous research. To ensure the best chance of success, it’s crucial to analyse community composition, website traffic, search trends and conduct social media listening and ethnographic research to identify the thematic drivers of the industry and potential shortcomings of your current infrastructure.
    It’s also important to resist trying to be everything to everyone. Define a narrow target group and content frame and then focus on building depth instead of width. Within these boundaries you can begin applying a more explorative approach. But if you’re heading down the wrong road, it doesn’t matter whether you’re flying, running or walking – you will not reach the right destination.
  2. Community building and audience targeting
    An unfocused approach often leads to heavily skewed communities, with an overrepresentation of irrelevant people. Our experience shows it is not uncommon for students, non-industry people and others from exotic markets, who are in no way relevant from a sales perspective, to constitute more than 60-70% of the community.
    One reason for this is that content is often so broad that everyone can consume it: from students, employees, friends and family to senior executives and investors. Such content might include a mix of job openings, feel good content, seasonal wishes, technical information, casual statements, creative gimmicks, competitions and blog posts. This type of content is easy to make, easy to consume and just as easy forget.
    A key dilemma is that companies of a certain size often span multiple industries and/or target groups with limited overlap. To combat this complexity, many react with a one-size-fits all model where the strategy is based on the channels instead of the target group.
    The consequence of this approach is that – sometimes unintentionally – the social media channels are used as broad reputation management tools. They end up attracting secondary stakeholders such as current and potential employees, investors, students and several customer personas in one big mix.
    To address this, our advice is to build up infrastructure and communities around target group(s) or customer personas instead of channels. This customer-centric approach demands a sound strategy, but also yields great results as the target group doesn’t care about what channel they are on – they expect consistency across the landscape.
  3. Business insights
    As social media is climbing the corporate agenda, commercial functions such as customer insights and sales are starting to look towards these channels for insights and value: and too often they fail to find any.
    As the data produced is often based on behaviour of non-target group individuals, the insights produced are at best useless – at least from a sales and business perspective. This is a pity, as data from these channels could be used to provide insights into customer needs, messaging, visual style, brand positioning etc. that can be used in a broader scale. But to maximise its potential you need to engage with the right people.
    Applying paid distribution helps you connect the target group and grow your community by seeking them out, rather than just waiting to be found. A narrow content frame will also discourage those outside your industry from engaging with your brand. Furthermore, it will increase relevance for your target group and thus qualify the data extracted from these channels as well.
  4. Key performance indicators
    We have seen from experience that social media efforts are too often evaluated on direct response metrics such as likes, clicks and engagement or, even worse, input factors like content frequency, paid reach and volume.
    Social metrics should primarily be used for content optimization, whereas the KPIs used to report channel performance should be relevant to business and the marketing system as a whole. These metrics can include, for example, ROI, change in brand awareness and perception, traffic to other destinations, lead generation, lead profiling, sales and customer insights.
  5. Wrong ratio between production and distribution
    Social channels are pay-to-play, whether you like it or not. Despite this, we still see limited reliance on paid distribution. This is due to the rather naïve conventional belief that these channels will grow organically as long as the content is good enough. Instead, the bucks are spent on producing content that nobody sees.
    This challenge is a recurring marketing menace. At Kunde & Co we have conducted many marketing efficiency studies over the years – most of these in the offline era. What we usually found was that companies practiced a 20/80 rule, where 20% of the collateral made 80% of the impact in the market. This principle was as relevant in the age of the brochure as it is in the age of social media.'
    Our advice has always been to focus on doing fewer, but more high-quality, brand-blazing and scalable elements and spend more on actually reaching the customer.
    So, contrary to popular belief, paid distribution is crucial when building channels. A key issue many face is reaching and engaging with prospects that don’t necessarily seek them out on these channels. Razor sharp, paid and behavioural targeting is instrumental to ensuring you reach these people and build the right community.

Begin by building the foundation

The challenge is to avoid placing presence (We just need to be there) and quick community growth (We need to show progress quickly) above a strong foundation. It may sound boring, but old virtues like rigorous analysis, sound strategic groundwork and customer-centricity need to permeate these channels too.

If these channels are to create value from a business viewpoint, they also need the organizational leverage to do so. Consequently, stakeholders with a commercial mind-set and a cross-organisational mandate that is placed above product and market interests should govern these channels.

There is great potential in social media. Very few other channels enable you to connect so cost-efficiently with a hard-to-reach target group. But, if companies continue to be led by the whims of irrelevant people and misleading metrics, business value and executive support will not arrive any day soon.  



Why Social Media fails to impress the C-suite

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