[Fast Company, May, 2010]
How many Facebook fans, Twitter followers, and YouTube subscribers does your company have? If your organization is like most, these numbers continue to increase but what are you doing about it?
A new study by Vivaldi Partners and Lightspeed Research analyzed more than 60 companies to determine how these social audiences create true value for companies. The study revealed that “social currency” is crucial for fostering customer loyalty and engagement through social media.
“Social currency is the extent to which people share the brand or information about the brand as part of their everyday social lives at work or at home. The study shows that social currency significantly drives brand loyalty.” Vivaldi Partners
Three Tips for Social Currency
1. Advocates Trump Followers. Starbucks has 80% more Twitter and Facebook followers than Dunkin’ Donuts. Does this mean Starbucks has a stronger and more loyal customer fan base? Not necessarily. According to the study, “Dunkin’ Donuts fans are 35% more likely to recommend the brand,” because the company takes a more customer advocacy driven approach as opposed to Starbucks’ strategy of promoting its products’ superiority.
Dunkin’ Donuts’ two rules for social media campaigns: “make them fun and make them cheap,” says the company’s relationship marketing director.
2. Social Isn’t For Everyone. Some brands are successful strictly for their functional superiority and do not need social currency to drive brand loyalty. Gillette is an example of a company with a 96% customer satisfaction rate. Social media campaigns from Gillette may only trigger conversations from the 4% of customers who are not happy with the company’s products. Not every brand should be social.
3. Social Tools Are a Means, Not an End. Axe knows how to engage humorously with its audience, but the company’s social tactics have not translated into meaningful conversations for the brand.
Conversly, Clinique has earned a strong social currency by educating and empowering its customers behind Clinique products and welcoming anyone has a brand evangelist. Companies cannot rely solely on social games for valuable connections with their customers.
“Marketing leaders should identify whether their brand has such social currency, and invest more in building strong connections between customers and the brand.” Forrester Research
Building social currency can take many forms, but as conversations increasingly occur within the digital arena, loyalty marketers must find ways to leverage brand conversations through credible social media efforts.