Social Media’s Chicken And Egg Problem

An article titled Research: Most social media marketing initiatives fail on New Media and Marketing states:

From the book The Social Organization the author states “One of our more striking discoveries is that most social media initiatives fail. Either they don’t attract any interest or they never create business value.” Why ? Because social media is not a tactic social media starts with a social organization focused on consumers and its customers.

[I think there’s a grammatical problem with the last sentence. I think there should be a period after the word tactic, and that the rest of the sentence is a new sentence]

My take: Hold on a second here. For the past two+ years, I’ve been reading left and right that: 1) The ROI of social media far exceeds the ROI of every thing else on this planet, or 2) The ROI of social media can’t be measured in just dollars and cents.

The explanation for why so many firms allegedly fail with social media is intriguing: That firms fail at social media because they’re not a “social organization” which the author defines as:

One that strategically applies mass collaboration to address significant business challenges and opportunities. Its leaders recognize that becoming a social enterprise is not about incremental improvement. They know it demands a new way of thinking, and so they’re moving beyond tactical, one-time grassroots efforts and pushing for greater business impact through a thoughtful, planned approach to applying social media. As a result, a social organization is able to be more agile, produce better outcomes, and even develop entirely new ways of operating that are only achievable through mobilizing the collective talent, energy, ideas, and efforts of communities.

When I first read this, I had a deja vu moment. Ah yes — substitute “knowledge-based organization” from the late 90s or “digital business” from the early 200s, and you realize that we’ve heard all this before.

My deja vu aside, I’ve also read — countless times over the past few years — that firms that don’t get into social media “will be left behind.” (Don’t make me find links, you know they’re out there).

So what should we conclude from all this?

  • That social media does indeed have a higher ROI, but only in a small number of instances, specifically those where the organization deploying social media has already become a social organization?
  • That a company that deploys social media will most likely fail in its social media attempts until it becomes a “social organization”?
  • That somehow a company should become a “social organization” BEFORE deploying social media in order to improve its odds of social media success?

If you’re a senior business executive feeling a bit confused by all this, join the club.

What this means is that — since social media is an imperative in today’s business environment (according to social media proponents), and that a firm must first become a social organization before achieving social media success (according to the author of the book) — business executives should take a leap of faith and radically change and transform their organizations before knowing if it’s the right thing for their organization.

And that is not going to happen in any well-managed, reasonably successful firm.

Social media gurus: It’s back to the drawing boards for you. And when you come back, please get your logic, rationale, and arguments straight.

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11 thoughts on “Social Media’s Chicken And Egg Problem

  1. I’m a lot confused by all this. Social organization?
    But I have a store front client in Omaha who placed some Facebook ads and targeted the right geos and demos with a message like, “fan us and we’ll give you something”. Between that and in store signs he’s got 3000+ fans. Now when he posts specials, people come in and buy the stuff he posted about on Facebook. Near as he can figure each fan is worth about $3.00 per month. He spent around $5000 on the ads.
    I understand that kind of ROI – even if some of it is intuition.

    • Steve: On one hand, I’ve w/ JP on this one: Sounds more like a testament to the power of advertising than the power of social media.

      On the other hand, whether it’s due to advertising or SM isn’t the point. Did your client have to first become a “social organization” to achieve the ROI? If no, then all the blather that “majority of SM efforts b/c firm didn’t first become a social org” is useless and wrong.

      If your client DID have to first become a social org in order to achieve the benefits of SM, then the costs of becoming a social org should be part of the SM ROI calculation — which will bring down the astronomical ROIs that SM gurus claim.

  2. Ron – I just emailed you a personal, real-life media marketing case study. powerful stuff. i think you’ll be a convert.

  3. Of course, Ron, before your company can become a social organization, you must make sure that all of your employees, investors, vendors, customers, and other stakeholders are socially oriented. This requires that each and every one of them had a socially correct upbringing, and were raised by socially inclined parents who were, themselves, socially oriented by the socially inclined. Granted, that only works if these social families are members of socially supportive communities based in a social environment steeped in social values that were socially derived. Other than that, it’s really easy.

    • AtomicTango: You raise a very good point. Can an organization become a social organization if it’s comprised of mostly anti-social people? If no, and if my company decides it has to become a social organization. I guess I’m out of a job. 🙂

  4. Oh my I used to be such a convert. Preaching the power of social, content and inbound. When you sit in a big agency and you have big clients that stuff just makes so much damn sense. I mean it must be true right? Well now I have my own business, and I work with small agencies who work with real entrepreneurs. And guess what? The bullshit quotient is mysteriously reduced. A lot. These guys invest dollars in sales and marketing and they damn well expect to know what they get for it. And suddenly inbound isn’t enough. And social is more or less a complete bust. Funny. I used to think I was smart. Now I’m learning what marketing and sales actually are.

  5. Pingback: Social Media's Chicken And Egg Problem | The Marketing Tea Party | Media Marketing

  6. Tim wants to date Barbara. He asks her out. She says no. He tries again and again and again. Tim even hires an expert love consultant to help him woo and charm Barbara. Despite his repeated attempts, he fails. Why? Because Barbara is simply not interested. She thinks he’s a nice guy, but there is nothing Tim could ever do to get her to date him.

    Tim = Most banks and credit unions farting around with social media
    Barbara = The coveted consumer financial institutions pursue

    There are as many theories about why companies fail with social media as there are “experts” proffering advice on how to “engage” with consumers on social platforms. “All you need to do is X, Y and Z,” the experts say. They suggest all these ways in which a company must change, the things they must do differently. So these companies go out and dutifully execute X, Y and Z… but with no effect.

    That means either the “experts” are wrong, or consumers simply have no interest in taking their relationships with financial institutions “to the next level.” Or both.

    Social media experts pretend like success with social media is entirely within a company’s control. The prevailing attitude is that you can win if you just do the right things. That’s as naive (even ignorant) as Tim believing he can still sway Barbara. Guess what Tim? There’s nothing you can do. Ever.

    But that doesn’t stop Tim. He tells Barbara that if she Likes him on Facebook, she’ll have a shot at winning a new Mercedes.

  7. You’re right, Ron — I’ve seen the same arguments. Here’s what it comes down to for me . . . a company can have a decent social media strategy and make it successful by simply paying attention to it just as they would any other direct marketing channel. That means take some care with it, be able to measure it, etc. And, to compete effectively, you’ve gotta have a social presence that resembles the messaging of your other channels. I don’t know if every person within the organization has to take an oath that they will become a “social media organization.” I think you just have to have some smart folks who like creating a social presence on your staff. I don’t think it’s rocket science here, is it?

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