While the digital age has done so much to improve our world, it has dramatically changed our social structure, often further isolating us from each other.
—Dean Ornish
With no personal customer relationships to build on and a 100 percent digital business model from day one, Michael Dubin, Dollar Shave Club CEO, needed to quickly attract attention, engage audiences, and convert them to members of his club, who are willing to pay $1 per month to have razors shipped to their homes.
Dubin and his partner, Mark Levine, had packed and shipped razors in his apartment until receiving a million dollars in venture capital seed money to prove their business model. The founders invested a few thousand of that million into an online video to launch their company. Grounded in strong storytelling and humor, and featuring Dubin’s own quirky yet dynamic character declaring his razors “f∗∗king great,” the video instantly grabbed audience attention.1 Dollar Shave Club launched that first online video early on the morning of March 6, 2012. Within hours, Dubin’s website, dollarshaveclub.com, crashed due to an overload of traffic. Overcoming those early technical glitches, Dubin signed up 12,000 club members in two weeks. Eighteen months later, his initial viral video had received over 10 million views. More importantly, in July 2013, Dollar Shave Club shipped about 1 million cartridges to its 300,000 members.
Dubin and his team use the same key elements we discovered at Ogilvie’s (and outlined in Chapter 1) to build long-term relationships, but perform them on a massive scale using digital technology. He tapped into a need—buying razors is an expensive hassle for most men. His video established a backstory, a history that even incorporated mustachioed forefathers. And, as Dubin has expanded his business, Dollar Shave Club sells not only great razors and blades, but other related products. Dubin put his face front and center in the video. He tells a great story about expensive brands, retail headaches, the quality of his products, and even the jobs his new business is creating. From the first headshot to the closing logo, Dubin’s video exudes authenticity. Dollar Shave Club follows up with the same attitude, tone, and style in their social interactions, and in the physical delivery of their products (which always ship with an ironic and clever note card). And, in his way, Dubin is being helpful.
Digging deeper, Dollar Shave Club and Ogilvie’s share another, less visible element to their success—the strength of their relationship with the customer. In both cases, the depth of the relationship has transcended into belonging. Dubin’s customers are members of his club—they belong, and they receive a sense of being inside, being cool, being accepted, knowing something, and being part of something special. Ogilvie’s customers, although they might not articulate it as clearly as membership if asked, are indeed members of a special club. They have an account at Ogilvie’s. They know where to find Ogilvie’s, hidden away on a back road with no sign to speak of, down by the railroad tracks. Ogilvie’s is their hardware store.
Kevin Whittemore and Michael Dubin both have discovered that, as Elbert Hubbard once famously stated, “An ounce of loyalty is worth a pound of cleverness.”2 Both organizations benefit enormously from the depth of relationship they develop. Ogilvie’s customers continue to pay for service, advice, relationships, and curation despite many other competing hardware suppliers. Dollar Shave Club continues to attract new members and increase revenues. In fact, Dubin’s members are so loyal they practically demand their friends join the club.a
What Dubin has done in many ways is to translate the real-world, in-store experience and deep customer relationship of an Ogilvie’s into its digital equivalents. It’s not that he has created an online hardware store with old-fashioned service, but what he has done is capture the essence of relationship—he’s engaged his online audience in a multidimensional, experiential dialog that stimulates the same emotions, loyalties, and relationship value as Ogilvie’s.
According to persona marketing expert Tony Zambito, many traditional organizations are caught in the throes of a major shift in buyer behavior driven by the influx of digital technologies: “We are experiencing a revolution in buyer behavior driven by a new form of consumerism, even among B2B buyers. With all these tools at their disposal, buyers now expect a transparent, Amazon-like buying experience, with volumes of data, reviews, pricing, and other information easily at hand for any and all buying decisions.”3
How can you do the same with your online audiences? Let’s start by taking a deeper look at today’s digital world.
According to Adam Sarner of Gartner, digital marketing is “an approach toward contextual marketing, addressable branding, community marketing and transactional marketing . . . extending marketing processes through channels such as the Web, email, video, mobile, social, kiosks, point-of-sale terminals, interactive television, and gaming platforms.”4
Today, we live within a finger’s reach of a digital device. From laptops to smartphones to smart cars to smart eyeglasses, a plethora of shiny digital objects connect us to the Internet, to each other, and to a vast global library of information. Every interaction we have is tinged with digital flavor. Even the local barber wants to add us to his mailing list, so he can send us an online satisfaction survey after each haircut. And yes, perhaps just a bit sadly for Kevin’s ancestors on the wall, even B.L. Ogilvie & Sons has a website. Today, all marketing, all communication, and all human relationships bridge our real and digital lives.
Over the past few years, the proliferation of social media outlets, massive increases in mobile, democratization of video, and the awesome and somewhat frightening power of big data analytics have conspired to turn the systems and processes of marketing on their collective heads. The distinctions between digital and traditional marketing are evaporating before our eyes5 (see Figure 2.1).
Marketers can no longer dictate customer perception by purchasing attention, and controlling storylines through massive scale, narrow focus, and traditional advertising. Instead, organizations of all types and sizes are now engaged in a multiplexed, uncontrollable, and constant information flow with their audiences. Digital technology has put the power firmly and literally into the palm of the consumer. Buyers listen to buyers and form their own opinions of our brands and messages. Customers and prospects are talking to each other—and not behind our backs either—right in front of our online faces, with competitors free to listen in, or even co-opt the discussion if we let them.
The explosion in social networking is not news, but the sheer size of these social networks may make you woozy. No organization could be expected to maintain an active presence on every social media service, but it is now critical to have a strategy and plan for meeting your target audience when and where they want to engage online. It is also critical to understand the norms and expectations of each community, and have processes to address their very different activities, purposes, goals, styles, and etiquettes.
Regardless of the requirements and pitfalls of social media, organizations are committing to them like never before. As captured in Figure 2.2, four of the major social networks have seen almost double the commitment by organizations of time and resources to manage their presence on these networks. If anything, the growth makes one thing clear—a resounding desire (or need) to be part of the digital conversation.6
Source: MarketingProfs.
The gorilla in the social mist by far, Facebook logged in about 1.2 billion active users as of June 2013, a 26 percent increase over 2011, meaning that about 11 percent of the entire population of Earth uses the site. More importantly, about half of those Facebook users access their accounts daily. The same amount access the service on the go, through Facebook’s mobile app.
Facebook is a personal, informal, social community. Marketing on Facebook tends to be consumer oriented. While businesses do maintain Facebook presences, it is safe to assume that B2B relationships are less likely to develop through Facebook than through other sites such as LinkedIn.
Twitter boasts almost 600 million users and adds 135,000 new users every day. Over 40 percent of Twitter customers use their mobile phones to add to the stream of 58 million tweets sent per day.7 After a confusing struggle to monetize its social girth, Twitter has now developed a self-service advertising and tweet promotion model that is expected to generate over a billion dollars in revenue in 2014.
Twitter is used actively by individuals, businesses, and organizations of all types. Twitter has turned us all into mini-broadcasters, with our own audience, Nielsen score (in the form of Follower count), microphone, and camera, all in the palm of our hands. For business organizations, the power has been virtually irresistible. Famously, when the lights went out at the Super Bowl in 2013, Nabisco’s @Oreo Twitter team, which had set up a war room specifically to deliver timely tweets to significant events, published the message above. (See Figure 2.3.)
The result? A massive social media response with close to 16,000 retweets! Unfortunately, efforts by others to repeat the @Oreo tweet’s success have met with less enthusiasm. An effort by @Charmin to exploit the royal birth of Prince George garnered less than 100 retweets. (See Figure 2.4.)
Many businesses are leveraging Twitter’s immediacy and transparency to enhance customer service while building their brand images. Some excellent examples include Verizon, JetBlue, and Virgin America. When frequent flyer Steve Jenkins realized his ticket stub did not include his Virgin America Elevate account number, he tweeted from his seat on the plane, and received a response from @VirginAmerica before the plane pushed back from the gate. (See Figure 2.5.)
Airlines, perhaps because their often-disgruntled customers are inherently tuned in and active on social media, make for an interesting social media laboratory. Unsatisfied by merely posting on third-party opinion sites, or issuing tweets to their limited audiences, unhappy airline consumers have demonstrated their willingness to take it to the next level by purchasing broad distribution of their angry sentiments. In one infamous case, @HVSVN took to the virtual airways with this tweet when his luggage was lost, and he could not get resolution directly from British Airways. (See Figure 2.6.) Instead of just tweeting, though, he purchased a promoted Tweet ensuring that it received a far wider distribution that just his immediate social circles. Note that it took the airline 15 hours to respond with an automated reply.b
Notice the “Promoted by” flag? That means that @HVSVN actually paid to have this message appear as an “advertisement” in the Twitter stream, enabling his rant to reach far more than his immediate circle of followers.
Oops. Although the response is probably not automated (it’s probably a cut-and-paste), it still fails to engage the customer (see Figure 2.7). You can probably guess the emotion upon which this relationship between @HVSVN and British Airways is now based.
Google+, which started well behind the leaders, is gaining traction quickly with over 350 million users. As an integrated component of the vast array of Google applications, Google+ has an advantage over standalone services in attracting users. Tight integration with the popular photo editing and sharing app Picasa, for instance, virtually ensures that anyone using Picasa to manage their photo library will become a Google+ user, as will most of those with whom they wish to share their photos.
LinkedIn is a popular networking service for business and professionals, with 240 million users, 40 percent of whom log in daily. The service has more than a million and a half discussion groups and is popular with networkers, recruiters, and job seekers. In mid-2012, LinkedIn acquired the popular Slideshare service, adding another 50 million users to its stable. Slideshare makes it simple to publish presentations.
YouTube, another member of the Google family, is the granddaddy of online video sharing sites, with over 1 billion users, and over 4 billion videos viewed per day—that’s over 1 trillion videos viewed annually. YouTube enables organizations to publish and share their video content, monetize it with ads, and engage with it via comments, likes, and shares.
Other sites can be highly influential depending on the organizational objective, and the list of potential social sites is extensive—Tumblr (210 million), Yelp (100 million), Pinterest (70 million), Reddit (70 million), Vine (40 million), MySpace (32 million), StumbleUpon (30 million), and so on. As mentioned, you cannot be effective everywhere on the social media landscape, so pick your battles, be authentic, respond quickly, and focus on using these tools to engage in the conversation, build trust, develop long-lasting relationships, and provide information.
We strongly suggest you do not use social to sell. Why? Because it’s a channel that consumers tightly associate with authenticity. Your Facebook and Twitter accounts represent a personification of the brand. Consumers feel like they are talking to a person. Social is church, town meeting, teacher night, book club, and the health club rolled into one. How would you feel about a life insurance salesperson pitching you at any of those venues? Be helpful, and butt out.
As illustrated in Figure 2.8 from BuyerSphere, consumers are using social to get information and advice that informs their buying processes. Social media is the digital equivalent of recommendations from friends and acquaintances in the buying process.8
Source: BuyerSphere.
According to Anita Whiting and David Williams, who looked at why people use social media from a gratification standpoint,9 there are a number of reasons why people enjoy social media (listed below). Buying things is not one of them.
Online video presents marketers with opportunities to bring their messages to life and engage directly at an emotional level with their audiences—rapidly accelerating the process of forming relationships. The growth and democratization of online video is overwhelming and pervasive. Over 450 billion video views occurred in the U.S. alone in 2012.10 In other words, 90 million or so viewers in the United States will watch 1.2 billion videos today. And, according to Cisco,11 the number of viewers is expected to double by 2016. In fact, Cisco predicts that more than half of all Internet traffic will be online video by 2016. In 2012, the online shoe retailer Zappos produced over 150,000 product videos, and received over 250,000 visits to its e-commerce site from viewers who interacted with their videos on YouTube.
As Michael Dubin discovered at Dollar Shave Club, telling stories with video helps form relationships faster with audiences. It also helps form deeper relationships. A 2012 study by the e-commerce video platform provider Invodo found that 52 percent of buyers reported that watching online videos makes them more confident about purchasing.12 In fact, we are learning that online video helps to accelerate the entire audience engagement and relationship development process.
We believe there are two primary reasons why video is such an incredibly powerful tool for building relationships with online audiences.
Source: Based on Mayer (2003); Moreno and Mayer (2007); Marols (2005); and Miyake et al. (1999).
Yes, video is powerful. And, it is clear, consumers are voting with their wallets. The “2013 B2B Demand Generation Industry View” (see Figure 2.10) already shows that more than 80 percent of marketers are using video as a channel for their demand generation.16
Source: B2B Demand Gen.
Forrester Research reports that growth in online video marketing spending is approaching $8 billion annually (see Figure 2.11), and advertising research firm Borrell and Associates predicts that over the next few years as much as one third of online advertising budgets will be spent on video.17
Source: Forrester Research, Inc.
Video can be daunting for many organizations. The technobabble is rife here when diving into the details of creating, uploading, distributing, and analyzing the impacts of video. But we hope you will be undaunted. Marketers at all organizations can benefit from producing and distributing video. And remember, one video can be used in many ways, from posting on YouTube to outbound email, to websites and landing pages. Forrester stated that a web page showing video is 50 times more likely to appear first in Google search results. Video can and will increase visitors, reduce bounce rates, improve conversions, and drive audience engagement.c
Remember, while Dollar Shave Club videos may look like they were filmed with a smartphone, Dubin proved that storytelling, strong verbal/visual elements, and infectious enthusiasm were all he needed to make you and three million other members want to join his club.
In 2012, mobile phone subscriptions reached nearly 7 billion—equivalent to almost 96 percent of the world’s population.18 Mobile subscriptions outnumber fixed telephone lines six to one. Many experts predict that mobile access to web-based content will overtake PC access in the next few years. Regardless of the exact timeframe, the key takeaway is that an organization’s digital presence must be designed with mobility in mind. The audience is now, and will be ever more so, on the move with a smart device within reach. We are instantly snapping and sharing pictures, uploading videos, engaging in live discussions regarding brand, message, and the experience of engaging with organizations.
According to market intelligence firm Comscore, mobile commerce reached almost $5 billion in Q2 of 2013,19 and with 1 in 10 e-commerce dollars now transacted from a mobile device, mobile commerce is now growing at almost 25 percent annually, or about twice as fast as e-commerce. However, it is not just about buying products and services online; we are now researching, seeking information, and discussing options with influencers in real time on the move. A 2012 study by Econsultancy20 found that 96 percent of buyers researched online before buying. An effective online digital presence ensures the mobile audience receives our story while out shopping, but we can be just as sure that the transparency of the digital engagement process means they are accessing our competitors’ sites, industry press articles, and more along the way. It is the combined impact of this multichannel, instantly accessible digital presence21—ours and our competitors’—combined with third-party opinion and information sites like Yelp, Trip Advisor, and Angie’s List that drive consumer perception. (See Figure 2.12.)
Many organizations are struggling to adapt. According to the market research firm Econsultancy, marketers now have a historic, and perhaps unprecedented, opportunity to leverage these multiple touchpoints. But for what purpose? To influence and inform? To drive transactions? Yes, and yes. To create a compelling and sustainable competitive advantage, though, we simply must remember that our goal in communicating with audience members online or in the aisles of our local hardware store is to form relationships. In Chapter 3, we explore more deeply the meaning, purpose, and value of relationships. For this discussion, it is critical to remember that the need for effective audience engagement through online channels must pervasively underlie all aspects of an organization’s marketing.
The process of building and cultivating online relationships benefits from the same processes and interactions that help cultivate any human relationship. Look the audience in the digital eye, listen for understanding, remember and use names, and offer context-relevant conversation, information, and actions.
The scale, reach, and speed of interaction are enhanced by digital channels, as is the ability to collect and process information that can be used to personalize future interactions. The term big data is so overused as to be meaningless, but the concept of capturing and storing relevant information about the audience is at the heart of relationship building. In Chapter 8, we discuss the concept of history, personalization, and relevance in more depth.
Just as Ogilvie’s employees observe the body language, demeanor, and even the clothing of their customers when interacting, so too must organizations seeking to establish and build relationships online find ways to listen to, observe, and understand audiences through digital body language. And just as in the hardware store, they must personalize their interactions with the audience in real time.
Online communities have existed from the moment UCLA’s Leonard Kleinrock typed L . . . O . . . and crashed the fledgling ARPANET on October 29, 1969. A few years later, Doug Brown and David R. Woolley at the University of Illinois created a real-time chat program called Talkomatic, which allowed five people on different terminals to share messages one character at a time as they were typed.22 Growing from a genesis in boards, discussion groups, online forums, and chat rooms, today’s social communities offer organizations a unique opportunity to engage a very special audience, their stakeholders, in a dedicated environment.
Digital communities are powerful purpose-built social networks and may actually be the closest analog to a “digital storefront.” But we won’t spoil that here. Chapter 16 delves more deeply into communities.
As we have said, and will reiterate, digital changes little in the basic ways humans form relationships, interact emotionally, learn, and develop. However, digital changes virtually everything about how we connect, come together, and exchange ideas.
For individuals, it empowers us to create, manage, and maintain relationships at massive scale. We can now access vast stores of information. Digital stretches our mental and emotional limits in terms of the sheer number and the depth of relationships we can maintain. It speeds the relationship development process by allowing us to move quickly from attention to understanding to a sense of belonging.
For organizations, digital enables a vast new set of tools and techniques to create and foster engagement, to reach vast audiences, to tell our stories, and to sell our goods.
It’s just that simple, and that complex.
Welcome to the conundrum.
Here are some things to think about as you get ready to grab digital by the horns:
Notes
1. www.youtube.com/watch?v=ZUG9qYTJMsI
2. http://en.wikipedia.org/wiki/Elbert_Hubbard.
3. We reference Tony Zambito in a number of chapters throughout this book. These references are from an interview conducted with Tony on September 11, 2013. You can learn more about Tony at http://en.wikipedia.org/wiki/Elbert_Hubbard.
4. Brittany Farb, “The Digital Age of Marketing,” www.destinationcrm.com/Articles/Columns-Departments/Insight/The-Digital-Age-of-Marketing-75983.aspx.
5. Created by Robert Weller using information derived from Thomas Schwenke. The original infographic is available at www.pinterest.com/pin/103512491406587673/.
6. “2012 State of Social Media Marketing: Social Media Measurement, Objectives, and Budget Implications,” MarketingProfs with Lithium, June 2013, www.slideshare.net/LithiumTech/state-of-social-media-marketing.
7. www.statisticbrain.com/twitter-statistics/
8. BaseOne and B2B Marketing, in association with McCallum Layton and Research Now. “Buyersphere Report 2013: A Comprehensive Survey into the Behaviours and Attitudes of the B2B Buyer,” September 2013, www.baseone.co.uk/documents/BUYERSPHERE_2013.pdf.
9. Anita Whiting and David Williams. “Why People Use Social Media: A Uses and Gratifications Approach,” Qualitative Market Research: An International Journal 16, no. 4 (2013): 362–369.
10. comScore, 2013.
11. Cisco. “Cisco Visual Networking Index: Forecast and Methodology, 2012–2017.” www.cisco.com/en/US/solutions/collateral/ns341/ns525/ns537/ns705/ns827/white_paper_c11-481360_ns827_Networking_Solutions_White_Paper.html.
12. Amy Dusto, “Online Videos Help Build Confidence in Purchases,” Internet Retailer, April 5, 2012, www.internetretailer.com/2012/04/05/online-videos-help-build-confidence-purchases.
13. Helmholtz, Hermann Von. “Physiological Optics.” Vol. 3. Southall, James P.C. ed. The Optical Society of America. 1925. Taken from http://poseidon.sunyopt.edu/helmholtz/OCRvolume3.pdf.
14. Cisco. From http://www.cisco.com/web/strategy/docs/education/Multimodal-Learning-Through-Media.pdf
15. Susan Weinschenk, “Design for Engagement—How to Design So People Take Action,” www.udemy.com/designing-for-engagement/
16. Ashley Verrill, “B2B Demand Generation Benchmark Industry View | 2013,” January 28, 2013, http://b2b-marketing-mentor.softwareadvice.com/2012-b2b-demand-generation-benchmark-survey-report-1212/
17. This is a commercial report put out by Borell and Associates. It is not available to the general public. www.borrellassociates.com/reports?page=shop.product_details&flypage=garden_flypage.tpl&product_id=1051&category_id=55.
18. mobiThinking, “Global Mobile Statistics 2013 Part A: Mobile Subscribers; Handset Market Share, Mobile Operators,” http://mobithinking.com/mobile-marketing-tools/latest-mobile-stats/a#subscriber.
19. This is from a press release, “comScore Announces Availability of U.S. Mobile Commerce Sales Estimates by Product Category and Leading Individual Retailer,” August 27, 2013, http://ir.comscore.com/releasedetail.cfm?ReleaseID=787376.
20. Econsultancy. “The Multichannel Retail Survey,” September, 2012, http://econsultancy.com/us/reports/the-multichannel-retail-survey.
21. Google, “The New Multi-Screen World: Understanding Cross-Platform Consumer Behavior,” August 2012.
22. David R. Woolley, “Talkomatic and ‘Term-Talk,’” www.liz.nl/plato04.htm.
aWe have a personal story here. Kirby Wadsworth joined the Dollar Shave Club a few months prior to starting this book. Despite being a self-proclaimed expert shaver, he managed to cut his chin using one of the new Dollar Shave Club razors. He felt strongly enough about being “in the club” that he chose not to blame the organization or its products; instead, he reached out through social media for some advice on what had gone wrong and received a torrent of suggestions about getting used to the new handle and blade. Apparently, others in the tribe had similar experiences.
bThe lesson here for marketers and communicators in all organizations is that social media never sleeps and the audience is becoming increasingly aggressive in using their newfound broadcasting power to make their wishes, delights, and disgusts heard. Be forewarned.
cIf there is one piece of advice we can offer about video, it is that content matters most. The most popular videos on YouTube were created by individuals using low-resolution cameras. Dubin spent a pittance on his Dollar Shave Club video. Professionalism is nice, but experience proves your audience will gladly overlook amateur production values if your content is helpful to them.