Dave’s Take

I’ve commented before about the negligible significance of social media in society; how Facebook, Twitter and all the rest are fun diversions, but serve little purpose in daily life. But now it appears that social networking sites have evolved to the point where they can finally offer society some tangible benefits. While they might not offer a cure for cancer, they can now help the American consumer with personal issues.

Led by national retail giant Best Buy, businesses are at long last embracing the immediacy of social sites to solve problems rather than to spin corporate advertising. Best Buy started a pilot program over six months ago that empowers their employees to interact with customers directly via Twitter and Facebook in dealing with product and store service inquiries. Since its inception, the Best Buy program has grown to include over 2,200 employees who are screened and instructed on how to best assist their customers.

And the customers are utilizing the new interactive avenue to the tune of over 15,000 regular “followers”. People are beginning to understand how they can communicate via Tweets to better their shopping experience. From product availability to pricing and delivery issues, consumers can now communicate directly with a store employee who will provide answers spontaneously. The Best Buy employees can accomplish this by referring the customer to a specific section of their website, sending them to a manufacturer’s site, or point them to a demo or ad link.

These new avenues of customer communication provide several advantages to their sponsors – mainly in brand loyalty and in reinforcing media direction and placement. This valuable feedback tells retailers how effective their media message is in regards to reaching the masses in a meaningful way. Clearly, if they keep getting bombarded with price or availability questions, they know it’s time to change their message. On the other hand, if customers share service complaints, etc. they know their employee training programs need some serious revamping.

Regardless of specific issues, consumers obviously like the immediacy of the program. A recent Nielson study discovered that nearly two-thirds of Twitter brand accounts deal with some level of customer service. Big players like Southwest Airlines, Comcast and Patagonia are all jumping into the social media customer service arena. They are now beginning to realize, like the rest of us, that social networking is finally beginning to serve a purpose other than wasting our time.

In what may be the most amusing (and ineffective) attempt at damage control, Hollywood movie studios are doing their best to minimize the “Twitter Effect.” What is the Twitter Effect? It’s the latest method movie viewers are employing via Twitter and other social media channels to get the word out on new movies. As anyone who follows box office receipts knows, if a flick doesn’t make it in its opening weekend, it’s damaged goods. This is especially true for movie franchise blockbusters, like Harry Potter or Star Trek. Prior to Twitter, studios could at least count on a few days of decent box bucks, even when the picture was a dog. With instant messaging, what took days for word of mouth to catch up to reality is now down to hours. “If people don’t like a movie on Friday, it can die by Saturday,” said Paul Dergarabedian, president of the movie-tracking firm Hollywood.com Box Offfice.

How much influence does the social media world influence today’s box office? The summer movie season is by far the most important period for the movie biz. As much as 40% of the annual box office receipts are generated during these three months, so strong openings are a financial necessity. Normally, a weak movie drops 40% in gate totals from week one to week two. This summer however, Twitter and other instant messaging systems have contributed to the average movie dropping a whopping 51% during the same time frame.

So how are the studios attempting to reduce the damage done by instant critics? Why by sending out their own tweets, supposedly from average moviegoers like yourself. They are texting quick one-liners about how great a new release is, regardless of the truth. Case in point – Bruno. While up-front buzz about Sacha Baron Cohen’s latest slag fest was huge, word of mouth via Twitter et al. revealed just how bad of a follow-up to Borat it truly is. Bruno opened with a respectable Friday, earning a total of $14.4 million. But by Saturday, its gate dropped 39% to a mere $8.8 million, hardly the kind of sales the studio expected. And it just got worse as word of mouth caught up to the Twitter effect. How many “bogus reviews” the studio tweeted to combat public opinion is unknown, but obviously they weren’t enough to overcome the legitimate tweets of unimpressed viewers.

Hopefully, social media channels will be one more iron in the fire for better movies. Hollywood needs more flicks with solid storylines instead of the CG studded special effects laden monsters that rule the summer theater fare. Movie studios would be wise to realize that in a free society, honest public opinion rules.

Along with flying cars, robotic maids and personal jetpacks, I place interactive television as one of the biggest lies fed to American consumers in the past century. As recently as 2001, American TV viewers were promised a whole new world with the installation of interactive TV or iTV as the industry calls it. We were baited into expecting everything from video on demand to interactive gaming would be but a click away from the average middle-class living room. Unfortunately, just like the Jetson’s space car, truly interactive television is just a dream.

A crude forerunner to iTV was first tried in the 1950s with the “Winky Dink & You” children’s TV show, where kids could tape a magic screen on their home set and draw along with the show. This eventually led to more refined attempts in the 80s and 90s to incorporate everything from t-commerce (buying goods in real time off your remote) to sending Email and files from your living room. The end game? To keep TV relevant by making your television as important to you as your computer and the Internet. Big companies like Microsoft, Bell South and Time Warner jumped headlong into the fray, spending hundreds of millions of dollars before realizing their mistakes and folding up shop.

There are an unlimited number of reasons why the majority of attempts at iTV have failed, ranging from exorbitant start-up costs to delivery compatibility issues. The few remaining iTV services are limited to video on demand and a few frivolous offerings like real time traffic and weather reporting. Shopping, videoconferencing, web surfing, banking and TV Emailing have never been fully developed and aren’t expected to do so in the near future. Which is a shame, because from an advertisers point of view, iTV could be a godsend. Think of the possibilities of real iTV: ads with guaranteed demographics; immediate feedback from customers; sales delivered for a fraction of the present cost per impression and those are just the beginning. The ability to change camera angles, display stats or watch a longer and more in-depth analysis of any news story is now just a dream. Same with Internet access and high def videoconferencing from anywhere—all dead for now.

Hopefully, declining viewership coupled with a recovering economy will motivate the major players into playing nice with each other and giving iTV the chance it deserves. I know the advertising industry will be waiting and watching.

Last week, I blogged about how Twitter and other social media sources were great for creating buzz, but lousy at delivering sales. Who could have dreamed that they would now be the main source for real time information about what’s happening with the revolutionary situation in Iran? The Iranian government has clamped down on most forms of news dissemination, including the shuttering of newspapers and television stations. MSM sources as well as protesters have adapted Twitter to get the truth out about what is going on in the Islamic republic. Just another example of how people will adapt to new channels of information if they are kept topical and relevant.

Lately there has been more buzz about Twitter than the plight of the U.S. economy. The MSM has beaten the tweet phenomenon to death, making it out to be just one step short of sliced bread. Celebrities are tweeting, politicians are tweeting, even people who don’t normally embrace new media (Elizabeth Taylor, Larry King, John McCain) are sharing their most inane thoughts via the tweet. Which begs the question, ”Why do we need to be alerted to someone’s mindless140 character thoughts at any time of the day or night?” Personally, I don’t really care when Ashton Kutcher is headed to the grocery store to buy salad fixin’s or what Paris Hilton’s latest buzzword is. In my opinion, only twits tweet. However, actual social networking can provide substantive advantages to the businesses that embrace it.

Before you write me off as another guy who “just doesn’t get it,” think about this: While 83% of the Internet population is using some form of social media, less than 5% actually turn to it for advice on purchasing decisions. In a new study, “How People Use Social Media” by Knowledge Networks, researchers have discovered that social media is indeed lighting a new path for friends to connect, but not one that provides any real guidance on buying products or services. Not only is twitter and it’s brethren not the go-to, one-stop shops for quick advice, but only 16% of social media users say they are more likely to buy from a firm or service that advertise on social networking sites. The overwhelming way people decide on major purchasing decisions? Word of mouth. Wow, what a concept! The good news is that these stats prove you don’t have to spend big money on social sites to be successful, just provide a relevant presence for your company or service.

Despite their apparent inability to create sales, social media outlets are on a popularity upswing and businesses that ignore them do so at their own peril. Like any other tool in the toolbox, social media outlets should be kept in your marketing mix. I advise clients to open and maintain accounts on social sites like Facebook, Likedin and Tagged. I also encourage them to post informative blogs highlighting their solutions to popular problems and concerns. While they probably won’t make the cash register ring, they will keep your business or product topical and in people’s minds, which is half the marketing battle.

So remember, to keep the buzz about your company or product fluid, invest some time and thought into social networking. Concentrate your efforts on sites that allow you to create a positive image, not just a 140-character punch line. In other words, leave the tweeting to the birds.