SXSW Interactive 2012: Hype, Hyperbole and How to Avoid It

A No-Nonsense Preview of Digital Marketing at SXSW
March 2012

In preparation for this month’s SXSW Interactive event we examined a number of technologies that we expect to be hotly discussed in Austin, and offer counsel for how to cut through the hype. 

 

Key takeaways

  • Crowded ad/marketing tech space, better data and analytics capabilities are leading marketers to make massive promises, especially about the ability of technology to provide a better ROI and drive sales.
     
  • Privacy remains a key concern for consumers, with insufficient reassurance from brands that better personalization is a fair trade-off for sharing personal, location, and other data with unknown entities.
     
  • Across the social ecosystem, the monetization question is unclear, and brands still need clarity about how to get social right and how to know when they’ve nailed it. Social marketing and advertising opportunities feel mandated by industry peer pressure, and yet platforms offer constrained creativity and carry inherent friction when consumers want to keep marketing from intruding on their personal interactions.
     
  • Organizational friction will persist as new technologies and approaches ask marketers to experiment before their departments are structured/staffed to accommodate it.

Contents

  • The “new” new Facebook: fMC announcements
  • Social media ROI
  • Mobile advertising: coupons/ deals
  • Predictive analytics for marketing
  • Content marketing: brands as publishers
  • Data-driven marketing (Big Data for marketers)
  • Bonus round: Pinterest

The “new” new Facebook: fMC announcements

What it is: New solutions for marketers on Facebook.
What it promises to do

  • Pages: “Mission control for your business on Facebook” – now includes timeline, with the ability to pin posts to the top, change page and post layout, highlight friend activity, real-time analytics.
  • Reach Generator: “Make sure your fans see your stories” – promises to guarantee 75% of a company’s fan base will see sponsored stories by showing ads only to existing fans of a page.
  • Premium Ads and Sponsored Stories: “The most impactful way to distribute your content on Facebook” - Advertising copy is phased out; from now on, advertising in the form of Sponsored Stories and Premium Ads will appear in users’ news feeds – both on mobile and desktop. Any post created on a Page can be used as advertising collateral.

Hype you can expect to hear:

  • “Facebook Timeline is the best thing for brands since Pinterest” (AllFacebook.com)
  • “It's clear that Facebook is using Timeline to help businesses craft a more personal, almost human-like, story.” (Clickable)
  • “The social network hopes to drive advertisers away from broadcasting static messages, instead encouraging them to build dynamic conversational marketing pieces. While conversational media isn't exactly a new concept (companies like Federated Media have been doing it for years), the scale and personality that Facebook adds is unprecedented.” (CNET)
  • “Essentially, brands will have the ability to use Facebook to talk to its audience like your family and friends talk to you on the site. Facebook harped on the idea that this is better for everyone: a connection is a connection, and businesses should be able to get friendlier, more communicative, more personal with customers (and potential customers).” (Digital Trends)

Ongoing obstacles

  • “Companies should be most concerned about the Friend Activity. While it's a great feature if everyone is speaking in glowing terms about your company, negative comments have a way of bubbling to the top faster than positive ones. If a company is concerned about reputation management, it should have the option of turning off Friend Activity.” (PCWorld)
  • “There was a lot of speculation in the ad industry that Facebook would finally use its vast store of data to serve ads beyond its own walled garden, and on the wider Web. But the company still seems focused on its own site, unlike its rival Google. Nate Elliott, a marketing and social media analyst at Forrester, said Facebook’s approach severely limited its potential for advertisers. ‘The big opportunity here is not on Facebook.com, it’s how they help marketers better target advertising on other Web sites,’ he said.” (The New York Times)
  • “What could derail this from happening? Lots of things. Users might get sick of seeing so much content from brands and decide to withdraw their Like. Google+ or Twitter might prove to be a better destination for brands. That status update-based ads might prove ineffective in the long run. Advertisers might decide that click-throughs actually were a good measure of ad performance. Ultimately, consumers will have the final say.” (Mashable)

Questions to ask:

  • How do I mitigate the operational complexities this may drive in my marketing organization?
  • How do I minimize the risk from potential downside on these new Facebook pages and protect my reputation from being hijacked online?
  • How do I protect the grass-roots credibility of my previous Facebook presence as we shift to an overtly commercial model?
  • What will Facebook do with the additional data it gathers about brands, and how can that insight benefit the brands?

Social media ROI

What it is: Using monitoring and analytics platforms to demonstrate the value of social media marketing. Platforms track social conversations on blogs and social sites (Twitter, Facebook). Some report on volume of mentions by keyword and analyze against competitors; others track users’ path from social conversation to purchase decision.
What it promises to do: Quantify dollar value of social media investment to a company’s bottom line and enable more strategic use of marketing dollars in social campaigns.

Hype you can expect to hear:

  • “Improves and automates processes and measures actual ROI for marketing spend.” 
  • “Delivers critical insights to let marketers turn visitors into active brand enthusiasts and viral sharing engines.” 

Ongoing obstacles

Questions to ask:

  • How do we apply analytics to draw a better connection between volume and sentiment? How do we know that more interactions are translating into better traction with customers? And how do we derive meaning from the numbers?
  • How do avoid the trap of social media being analyzed in silos rather than from a holistic and customer-centric point of view?
  • Gathering crowds online is great, but how do you monetize your social media traction and turn it into business growth?  

Mobile advertising: coupons/deals

What it is: Promotions (coupons or vouchers) delivered to consumers’ smartphones via location/ check-in, QR code, SMS. Sample providers include ScoutMob and Groupon, but retailers and other businesses may elect to work with technology vendors for their own targeted and general promotions.
What it promises to do: Reach always-connected consumers in more personalized, relevant circumstances—for example, when they are nearby.

Hype you can expect to hear:

  • “30% of smartphone users will acquire and redeem mobile coupons on a regular basis by 2013.” (Microsoft)
  • “Until true context is leveraged in the pursuits of each of the mobile players, including brands, content owners, marketing agencies, retailers, advertising networks and mobile app providers, it will be difficult to advance the real opportunities that mobile marketers have in driving the consumption of commerce, content, apps and games.”  (Mobile Marketer)
  • “Mobile targeting can drive mobile shopping…Geographic indicators can alert marketers to where mobile deals will be most effective.” (IAB)

Ongoing obstacles

  • Privacy concerns – and the “creepy” factor (Washington Post)
  • Only a multichannel approach can take full advantage of any benefits of mobile offers (eConsultancy)  

Questions to ask:

  • Think of your standard coupon marketing strategy. What is fundamentally different about the digital coupon and how does it fit into your broader marketing strategy?
  • How can you implement the mobile coupon strategy while still honoring privacy and following the cardinal rule of marketing: permission.
  • How do you integrate mobile coupons into a broader multi-channel strategy?

Predictive analytics for marketing

What it is: Advanced data mining and modeling using complex sets of data to capture finer grained insights about consumer behaviors.
What it promises to do: Provide more effective marketing optimization, more complete testing, and better outcomes in predicting how marketing decisions will impact consumer purchasing behaviors and therefore sales.

Hype you can expect to hear:

  • “You can gain faster insights and optimize programs by simultaneously testing copy, offers, and creative rather than deploying the more traditional A/B-testing methodology, which may take longer and delay course adjustments.” (MarketingProfs)
  • “New modeling techniques can bring brand managers closer to achieving the dream of ‘push this button, get that result!’” (MarketingProfs)

Ongoing obstacles

  • No hard results unless CRM/analytics partner closely with creative teams (ClickZ)
  • Organizations need to be set up to act on results (Information Management)

Questions to ask:

  • Where exactly do we think we have the biggest blind spots and where would predictive analytics be most useful?
  • What are the technical obstacles yet to overcome before predicative analytics does become more useful in those specific areas?
  • How do you overcome privacy concerns in delivering predictive analytics?
  • What are the safeguards against false positives and bad guesses?
  • What do you actually do when you have these insights?

Content marketing: brands as publishers

What it is: Brands creating content for their websites and social channels (company blogs, Twitter, Facebook) with a broader focus that just their products or services.
What it promises to do: Make the marketing “voice” more interesting, improve SEO, engage consumers who are typically turned off by self-promotion.

Hype you can expect to hear:

  • “Marketing departments are a new hub of journalism…and journalism employment” (Adweek)
  • “Given that brands are all about voice, meaning, values and point of view, having the skills of a conversational publisher is critical to success.” (Ad Age)

Ongoing obstacles

  • Further confusion for consumers as it becomes harder to distinguish between 3rd party media (e.g. articles written by journalists) and 1st party brand content (GigaOM)
  • Increased resources and thus organizational buy-in necessary to support time-intensive nature of content marketing
  • Increased emphasis on metrics to justify spend

Questions to ask:

  • How do you protect your credibility as a “brand publisher” without being seen as the next infomercial?
  • How do you staff up and operationalize an editorial department (apart from hiring out of work journalists and editors), and what new skill sets do you need?
  • How do you integrate an editorial arm into your marketing mix?
  • How do you balance earned media and paid media to achieve the right mix of reach and credibility

Data-driven marketing (Big Data for marketers)

What it is: Companies amassing unprecedented amounts of user-generated data, from social posts to behavioral data, and strategically analyzing it for business and marketing intelligence.
What it promises to do: Take the guesswork out of marketing, increase ROI on marketing spend, help analytics teams persuade executives who are tied to a pet project or concept.

Hype you can expect to hear:

  • “Data as currency, valuable in its own right”– The World Economic Forum declares data to be a new class of economic asset
  • “Consumers leave contrails of data as a result of their digital interactions, and this behavioral data creates opportunities to drive customer acquisition, reduce operating expenses, and make faster, better decisions.” (eConsultancy)

Ongoing obstacles

  • Privacy, again. “To put it another way, when we use Facebook we no longer just view the ad; we become the ad. It's a notion that disturbs some people, especially as Facebook continues to challenge social norms about privacy and use of personal data. Indeed, one reason advertisers love Facebook is that ads can be precisely targeted to specific audiences on the basis of their stated interests, location, ‘likes,’ and much more.” (Technology Review)

Questions to ask:

  • What security concerns should I be aware of, and how do I mitigate those?
  • How do I take advantage of big data without alienating my customers who value their privacy?
  • How do I renegotiate an alliance with my customers such that they understand—the more data companies have, the better companies can serve them!

Pinterest

What it is: A social site in which users “pin” images of things they find interesting to a “pinboard.”
What it promises to do: “connect everyone in the world through the 'things' they find interesting.”

Hype you can expect to hear:

  • “Similar to photo contests on Facebook or Twitter, Pinterest offers a way for brands to build visually stunning interaction between themselves and their patrons….allows photos to communicate a brand’s personality” (Mashable)
  • “Because of Pinterest’s commenting ability, it’s an ideal platform on which to introduce a new product and gather firsthand opinions.” (Mashable)
  • “Pinterest can greatly boost traffic to websites from which content is “pinned” and thus boost sales” (VentureBeat)

Ongoing obstacles

  • Unclear if the company is sustainable; business model is based on value creation by users and the creators of the image content they “pin” (Forbes.com)
  • Concerns over legality of content reposting…users are required to certify they have permission to repost content (Business Insider)

Questions to ask:

  • How does this differ from the old traditional community bulletin board, and what should I expect differently in terms of marketing results?
  • What insights does Pinterest provide that other social media properties don’t?
  • What’s the connection between Pinterest traffic and growing business or bolstering brand loyalty?
  • What metrics should I put against a Pinterest investment, and which ones don’t make sense?