Social Media Return on Investment – A reply to Jim Novo

Jim Novo wrote in response to the last post:

This is an interesting line of thought Christopher, perhaps I can help with a bit of a framework. And you’re right, product is the root of Marketing decision making. I hope my attmept at a chart below makes it through the CMS without breaking…

Brand for any product is a continuum between Product-centric and Image-centric, example:

……….Product Centric………..Image Centric
Beer…….Sam Adams………………Budweiser

Image-Centric Brands tend to have commodity status, which begs the need to differentiate by creating some kind of unique Image. Product-Centric Brands differentiate on hard Features and Benefits.

If you think about the Marketing for Sam Adams, it’s all about ingredients and customization. If you think about the Marketing for Budweiser, it’s all about wanting to be like or associating yourself with the people or images in the spot – “Yea, that’s me!”.

Now, if you think about Social success stories, you find that they really gravitate towards Product stories, and not Image stories. Image stories are too easy to destroy in the social fabric; product stories bubble up *from* the social fabric.

So the success of social will largely be determined by where your Brand is on the continuum between Product-centric and Image-centric.

And here we arrive at a bit of irony.

Many of the most successful Social “Campaigns” happen when the company does absolutely nothing overt in the social space – see Apple, and many other Product-centric Brands.

And some of the lamest and most clueless Social campaigns have been from commodity Image-centric products that tried to do something overt in the social space – see various packaged goods.

Meaning, you don’t really have to *do anything* to get ROI from social if you have a successful Product-Centric Brand – the ROI is infinite because there is no spend. And the ROI for an Image-Centric Brand is likely infinitely negative – any spend will never generate enough incremental sales to pay for the spend.

As far as Marketing discplines go:

……….Product Centric………..Image Centric
……….Direct Marketing……….Mass Marketing

Direct has always been a Product-Centric approach; it has to be or the Math doesn’t work; it’s Feature / Benefit driven.

That’s not to say companies employing Direct do not have “Brands”, they most certainly do. But the Brand is very tightly tied to product, not so much with “me too” Imagery.

Make sense? Help in your quest?

This both makes sense and helps.

The nature of the product is certainly a dimension in this problem, and your model rings true.

So much of what we really consume is in our heads. Certainly, there’s often a physical aspect of most products. For certain products, it’s about how we feel about them. And to a certain extent, how we feel about a product is what we are and what our friends are like and how much our friends really influence ourselves. I can point to product diffusion studies in marketing science around artist popularity and DVD sales to back that up. The nature of the social graph is as important as the social impressionability of that social graph.

If you’ve listened to any commercial music since the advent of the Bit Torrent, you know that there isn’t really a qualitative explanation as to the variation in popularity of a given DVD. What we consume is sometimes, though not always, in our heads.

For a commoditized product that really isn’t differentiated based on the general attributes or quality of it – I can see where a company will want to compete in your head and for your friends. Of course, not everybody is as susceptible to social effects as others. Beer choice amongst friends versus beer choice amongst professional associates might be one.

I think we have to consider where a product is in terms of adoption is important too. Just because something on its own might have better features than another – it doesn’t guarantee successful diffusion.

I’ll need to think longer and harder whether or not the ROI curves asymptotic.

But, as of now, we have ourselves at least three dimensions.