What      would Dresden do to craft and finalize the value proposition and product      offering for Online Advertisers Social?  Could a      proprietary metric be built to…

What      would Dresden do to craft and finalize the value proposition and product      offering for Online Advertisers Social? 
Could a      proprietary metric be built to measure campaign and community management      value? 
How should      metrics be reported to clients, as perfectly objective measures or as a      probabilistic model?
How      would the message be delivered to a client who wanted to know exactly how      their money would make?

Harry Dresden, a digital strategist at Online Advertisers, looked up at the wall in front of him. The wall was full of temporary marker notes, arrows, bullet points and dates. Matthew Bilbilly, one of the co- founders of Online Advertisers, and Dresden, had created the wall to visually map out Online Advertisers’ new social media division, Online Advertisers Social. After three weeks of research, Dresden and Bilbilly had devised a potential value proposition and completed the competitive industry and internal analyses to identify a potential path forward. As a new social media company, management wanted Online Advertisers Social to carve out its own niche, rather than competing directly with other social media companies with more money and experience. Offering a value proposition that leveraged Online Advertisers’ strengths while creating a unique point of differentiation was crucial. In devising this, Dresden needed a solution to the existing dilemma, social media metrics.
Dresden’s research on the social media marketing industry revealed that proprietary analytics and success metrics were two major client concerns. Marketers were clearly starting to appreciate the value in marketing through social media; however, few understood how to define or quantify that value. The nascent and complex nature of social media marketing had made corporations wary of social media marketing firms with value propositions that pushed creativity on the implementation side without solid metrics and reporting. The general client sentiment was that creativity alone could not justify marketing spend, especially when comparing social media marketing with other marketing initiatives competing for the same dollars.
There had to be a legitimate and reliable way to measure social media effectiveness. More and more corporations wanted an easy-to-read return on investment figure in exchange for their business.
A large number of products online claimed to have the ability to calculate social media return on investment. After a closer inspection, Dresden had discovered the claims were not convincing and all lacking in one way or another; none of the products encompassed the entire, complex picture of social media.
Dresden summed up his views on social media measurement in a conversation with Mitchell Wong, head of affiliate marketing at Online Advertisers:
Social media measurement is a huge bubble in this industry. So many companies are saying, “Here is how you figure out your social media ROI in a few easy steps, now buy my tool today…” They know corporations want an easy answer and they’re preying on that weakness. However, the answer isn’t that simple. How do you measure something that starts on the internet, moves offline, then comes back onto the internet, then moves back offline again, in an unpredictable manner? How do you measure human behaviour without making a few assumptions about probability? Anybody who tells me all I have to do is enter 10 easy to find income statement and balance sheet figures to receive a magical social media ROI figure is praying that ignorance pays…. That’s just not how human behaviour works, and social media is human.
It looked like there might not be a magical figure to represent the complexity that was social media, but Dresden had to find a way to represent a social media marketing initiative’s success — or failure — somehow. This required starting with an analysis of what had made successful social media campaigns successful and identifying differentiating factors that could be named and, hopefully, measured.
In 2009, Online Advertisers was born because the two owners realized that they had the intellectual ability to succeed on the web. Online Advertisers was originally an online web development and design company. During the first year of operations Online Advertisers acquired a niche of start-ups and young businesses to build a portfolio. After two years, the company grew at an exponential rate and became larger; as a result, it had acquired its corporate clients. Online Advertisers continued to work with start-ups, taking equity in a number of digital companies from a variety of industries, as they came online. With positive cash flow and an office filled with 12 employees and only two years of operations — the owners had been constantly seeking new ways to grow revenue streams. Online Advertisers had a strong in-house creative team, and the team had been able to leverage its creativity and intuitive talents to acquire clients. In the past, the creative team had been the driving force for much of Online Advertisers’ strategy and success.
Online Advertisers had recently started an affiliate marketing company and introduced a highly customizable ecommerce platform. The social media division was an integral new area of growth for the company. Both owners had high hopes for the division, as social media marketing margins were some of the best business-to-business (B2B) margins on the web.
The company had named its social media division, Online Advertisers Social, and already had two clients through previous web development relationships. Both clients were very happy with Online Advertisers’ personable service and ability to produce results, but there were issues with expressing those results in a standard, metric-based form. To expand the division into a larger revenue generator, some direction was needed.
Online Advertisers Social needed a high-level strategy, paired with streamlined internal processes, of which should be driven by a sustainable value proposition. This was why Online Advertisers hired Harry Dresden to analyze the social media marketing landscape and learn what Online Advertisers Social should offer.
After three weeks of research, Dresden and Roth had devised what they felt was a solid strategy for the new division. The value proposition for Online Advertisers Social was simple and best summarized in three words: Agile (able to react quickly to client needs), Analytical (data-based management), and Social (keeping in mind that consumers are people to be well treated). The only problem Dresden had with the current value proposition was that it did not leverage the creative team and had Adpioneers directly competing with larger competitors on analytics. Equipped with a strong in-house creative team, Online Advertisers Social was capable of campaign management and graphics design on the fly. In the past, the creative team had proven to be effective in both web development and social media campaign creation. Thus, should the team be better represented in the proposition?
If a client received a negative comment or customer complaint on their Twitter page, the project team could diffuse the situation within minutes, before things had the opportunity to get out of control. Online Advertisers Social had shown that it could monitor and manage corporate social media while leaving marketing departments to their core competencies.
However, when it came to analytics and metrics, existing capabilities were absent. Online Advertisers used a number of listening tools to manage campaigns with effectiveness, but there were still no tried-and-tested metrics or formulas to show its clients the value for money.
Many of Online Advertisers clients were smaller companies with little insights into their consumer base. On the one hand this made effective social media marketing a difficult task; on the other hand, it opened up the opportunity to provide businesses with data on their target market as a value-added service.
Internet marketing, also known as digital marketing and e-marketing, is generally divided into three major groups: search engine optimization (SEO), pay-per-click (or per impression or per action), and social media marketing.
Search Engine Optimization
Search engine optimization (SEO) is the process of improving a website or webpage’s search ranking on Internet search engines. Search engine optimization is a form of organic traffic generation because website owners do not pay the search engine (such as Google or Bing) to be optimized, but rather they will optimize their placement on a search engine in order to direct search engine users to a website/webpage through the search engine’s search algorithm.
Pay-per-click is a method of marketing that places advertisements on websites as texts or graphics. When a consumer clicks on an advertisement, a predetermined “cost-per-click” is paid to the website owner from the advertiser. Alternative methods of this model are pay-per-impression (every time someone sees the advertisement, the website owner is paid, regardless of whether the user clicks or not) and pay-per-action (every time someone buys because of the advertisement, the website owner is paid).
Social Media & Marketing
Social media use has grown immensely over the past five years, across all demographics. Today, Facebook has more than 750 million users,1 while Twitter has more than 175 million2 and YouTube nearly 500 million3. Due to the exponential growth of social media users, user time spent on social media sites, and the high level of consumer engagement possible while on social media, corporations have started to take social media seriously.
A recent McKinsey research study stated that enterprises utilizing social media have significantly improved performance and are more likely to be market leaders, or to be gaining market share, in their respective industry.4 The study also indicated that companies that fail to implement a social media strategy could be making a critical mistake.
For many companies social media represents a low-cost, yet often poorly executed method of communicating and relationship building with consumers. Through the creation of online communities, dialogues, and group discussions, social life has moved onto the Internet, and so has business. With this shift, online image has become an important part of a company’s profile.
Spending on social media networking has increased by over 800 per cent in the past five years.5 To remain competitive the question is no longer, “Should our corporation have a social media strategy?,” but, “What is the best social media strategy for our corporation?” The complexity of social media strategy — that is not always evident at the onset — has led many companies to outsource their social media initiatives.
The social media space is a fast-paced environment, which allows for large-scale interactions within a digital landscape. However, social media initiatives require rigorous attention to detail and constant attention to consumer interaction after inception, because timeliness and agility are necessities in social media — such as a social situation.
Social Media Listening Tools
Social media listening tools are an integral component to any social media strategy. Listening tools are social media tools that are used to listen to public conversation on the web, rather than communication tools, such as Facebook or Twitter. A number of listening tools on the web distill vast amount of public information floating around social media sites into intelligible data that can help social media managers to
better understand their community and social media users and thereby provide a rich source of information from which valuable consumer insights may be gleaned.
Listening tools allow managers to measure and track important variables such as volume, sentiment, demographics influence, trending topics, “share of conversation,” “share of voice,” volume trends, brand volume by media type, sentiment breakdown (positive and negative), liked/disliked entities, liked/disliked themes, regional activity and much more.
Listening tools streamline social media management and help managers determine who is helping the company’s image online and who is not. Listening tools are one of the main ways that corporations can be “more social” with their social media. When used properly, listening tools allow companies to distill a large amount of information while relating to people at an individual level — being strategic while being human as well. Thus, management is not only made better with the use of listening tools, but also with metrics.
There are two major components to a social media strategy: community management and campaign management. Community Management represents the day-to-day operations of a company’s social media strategy. Unlike social media campaigns, community management is an ongoing process by which social media voice, brand, and growth, are optimized, through interaction with current and potential consumers online. Community management includes determining the appropriate social media platforms for a company and adeptly managing the use of platforms.
When engaging your community you have to understand why your friends, fans or followers are members of your community so as to motivate them to be active, however, this is defined with respect to the company objectives.
A large part of community management deals with feedback, both positive and negative. Quality community management produces the right amount of content to keep the community engaged. Further, quality community management requires constant building and management of a community composed of an ideal target market, not just the largest friend/follower base that money can buy.
Interestingly, many social media marketers seem to believe that the goal of community management is to attain as many friends and followers as possible, so as to develop the largest community. Community- based strategies seem to be designed to entice anyone and everyone to enter a company’s online community through a method called friend seeding. Although this may develop a large audience in the short term, there is a high probability that the audience will be filled with people who may not want to listen or engage. Friend seeding can lead to irate consumers, negative feedback, and a negative image online, as the growing user base is neither interested nor involved. Negative social responses can quickly spin out of a company’s control in this sort of environment. Once a negative sentiment spreads across the web, firefighting becomes nearly impossible.
The goal of community management should be to optimize the number of interested community members who comprise the core target market for a company and enhance internal community member engagement. This can be achieved by creating conversation and buzz through substantive business-consumer relationships, rather than symbolic ones. Community members need to become engaged through group conversation instead of dialogues or monologues. The whole concept of social network marketing —online and offline — is to allow the network to do the work itself. Dialogue conversations can only exist within the time available to social media managers during the day, while group conversation can grow exponentially with more and more users taking part.
Online Advertisers Social planned to build community relationships through engaging positive and active community members, called Ambassadors. Ambassadors are active individuals within a company’s community. They have either brought others into the community or regularly created conversation and content.
Social media fails when it is not social. A social media strategy needs to incorporate the gritty details of implementation and social life and include constant listening, analytical tools, and human reactions to shift in conversation sentiment and content. Social media managers need to know how to deal with both positive and negative comments and feedback as well as how to build positive relationships that go beyond short- term mindsets, which solely focus on obtaining a sale.
Wolf21 offered a number of services, including SEO, Price-per-click marketing, e-mail marketing, display advertising, online media buying, and social media services. Their value proposition pushed their ‘cost- effective method’ of intensifying traffic to corporate websites through the use of LinkedIn, video content, a blog feed, events promotion, and fan engagement.
Wolf21’s social media value proposition was based on efforts to build a strong blog feed and “social media SEO” with an end goal of driving traffic to the corporate website. Wolf21 did not specialize in the creation and monitoring of content. Wolf21 was a very analytical company, and did not rely heavily on creative designs and marketing.
Social Media Group
Social Media Group offered strategic consulting, enterprise services, measurement services, reputation monitoring and general social media management. A major component of Social Media Group’s value proposition was that the group had comprised of seasoned project managers.
Social Media Group offered proprietary analytics and reporting and marketed itself as social media savvy experts, with whitepapers and jargon for support. Their approach to social media was very analytical and organized with the defining of business objectives, followed by research and development (R&D), then strategic planning — completed by a team of analysts, developers and designers. Social Media Group had worked with clients such as Yamaha and Ford in the past.
Syncapse was Online Advertisers largest competitor. Started by an ex-Facebook employee, Syncapse was the largest social media management company in Online Advertisers’ region, with millions of dollars in backing and a unique platform and measurement tools. However, Syncapse only offered social media services, including strategy, build, management and measurement. It also offered its clients return oninvestment (ROI) figures, and real-time analytics, which had been all organized on an easy-to-use dashboard. Syncapse labeled their social media platform as “the first social media management platform to operate across a range of social networking sites.” Syncpase also moderated social activities across 30 languages and had worked with brands such as Budweiser, Blackberry, GE, and Labatt.
As a small player in the industry, Dresden hoped to emulate the Syncapse model with Online Advertisers Social. However, Online Advertisers Social would differentiate itself as a boutique, microcosmic business model of the Syncapse model, with friendly service and agile project management.
There are many ways to measure the success of social media initiatives. To follow all public nodes and connections within an online social community is possible; but to follow a social conversation, which goes from the Internet and offline and then returns to the Internet, is not as easy to measure.
Harry Dresden found that campaign management was much easier to measure or to provide an ROI figure than community management. Campaigns existed within a defined temporal period and could be tied to specific online content, conversation and target market(s). There were still a number of qualitative measures that were challenging to quantify when measuring campaign success. However, a realistic and fairly accurate ROI figure seemed realizable.
Dresden made a top 20 list of factors that could affect social media success and ROI. Depending on the industry, competition and social media strategy each of these measures may vary in importance to a company’s client. It was important to be cognizant that some of the measures were more relevant in campaign management and others in community management.
Quality of Fans, Followers, and Friends
How often do your community members interact with you and your community? Are they influential among their peer groups and among those that you wish to bring into your community?
Growth Rate of Fans, Followers, and Friends
If you are running a campaign, how many new community members have you attained? Does your community continue to grow at a steady rate?
Level of Community Engagement
How does your community interact with you? Are they engaged when you offer a deal or a contest? When you ask your community a question, do they respond? Are your community members interested in your content and copy?
Number of Active Ambassadors
How many of your community members engage and influence a large number of target market members in your social media space?
Likes or Favourites
How many Likes or Favourites does your campaign have? How many Likes do your posts have?
Click-through Conversion (Pay-per-click Optimization)
What is the cost-per-click for your social media affiliate marketing campaign?
Influence of Consumers Reached
How connected is your network?
Online Buzz
How is your company, product(s), service(s) or campaign(s) discussed on the web?
Online Sentiment
What is the tone of the online conversation about your company, product(s), service(s), or campaign(s)? You want to ensure that people are not only talking a lot, but also saying good things!
Profile of Engaged Audience Compared to Desired Target Audience
Are your campaigns and efforts attracting your target market?
Visitor and Follower Time Spent Interacting with Company Social Media
The longer followers interact with your social media, the more likely they are to be engaged and buy. The longer visitors interact with your social media, the greater the chance of conversion. What matters most is the followers and visitors that stay and join the conversation.
Consumer Method of Content Discovery
When running a campaign, it is important to identify the path that people took to access your social media content. Did the campaign bring them in, or was it something external?
Online Polls and Votes
What are the results of your online polls and votes? How many people were engaged?
Contest/Deal Engagement
What is the percentage of your community members who take part in contests? What is the percentage of their return for the next contest?
Volume and Content of Customer Feedback
What type and quality of feedback are you receiving?
Customer Acquisition and Visitor Conversion
After people visit your social media sites, do they return? Do they like you? Do they befriend you? How many members of your target group are engaged as members of your online social community?
Comparable Competitor Analysis
How do you measure competition? Are your campaigns effective? Are your community members engaged?
Response Rates
When you initiate conversation, does your community respond? When you offer a deal, does your community act?
Impact on Offline Behaviour
Do customers redeem discounts at physical locations? Are physical sales instigated by online communications?
Money Saved from Using Social Media rather than Traditional Channels
A social media strategy does not cost nearly as much as traditional media! You can have a team of in- house programmers, designers and analysts at your disposal for a fraction of the cost and reach many more people. (Facebook does have 800 million members after all).
Dresden stared at a public Syncapse report on his desk. The report clearly stated that a Facebook “friend” was worth Cdn$136.38. After all the analyses, Dresden found it annoying that a company as complex and metric-focused as Syncapse would be willing to reduce its Facebook friends to one value. After reading the report in full, Dresden was even more perturbed. The design of the study was unscientific; all of Syncapse’s measures were situation-specific without much of a case for external validity. Even within those situations, the measures were lacking.
Dresden knew that many companies struggled to accurately calculate social media ROI, but presented externally to existing and prospective clients that there was a “magic formula.” Given this competitive reality, what would Dresden do to craft and finalize the value proposition and product offering for Online Advertisers Social? He refused to mislead clients about metrics, but everyone seemed to want something impossible. Could a proprietary metric be built to measure campaign and community management value? How should metrics be reported to clients, as perfectly objective measures or as a probabilistic model?
Dresden began to think of social media management as very similar to brand management. Spending a dollar today could help create and sustain loyalty over the long term, but how would the message be delivered to a client who wanted to know exactly how much their money would make?
Dresden also had to seriously consider the value proposition of Online Advertisers Social. With such a strong creative team driving Online Advertisers’ success, it seemed nearly impossible to solely focus the value proposition on data-driven analytics.

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