Social Media Marketing


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Social Media Marketing presentation of my research paper in the 4th Mediterranean Conference of Information Systems September 2009, Athens Greece

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Social Media Marketing

  1. 1. Dr. Efthymios Constantinides Assistant Professor School of Management and Governance / NIKOS Institute University of Twente [email_address] The Social Web as Marketplace A Primer in Social Media Marketing 4 th Mediterranean Conference on Information Systems Athens 25 – 27 September 2009
  2. 2. <ul><li>- What is Social Media / Web 2.0? </li></ul><ul><li>- What are the effects of Social Media 2.0 on customer behavior? </li></ul><ul><li>- What is the position of Social Media as part of the (online) marketing strategy? </li></ul><ul><li>- How Social Media applications can be engaged as marketing tools. </li></ul>
  3. 3. Why is Web 2.0 / Social Media an issue for Marketers?
  4. 4. Marketing is changing Declining Effects of Traditional Marketing Strategies / Tools Increasing Customer Power Decreasing Customer Trust
  5. 5. More Information More Alternatives Easy Transaction The Customer has much more Power than ever before: 3 main reasons: the Internet (1995 – 2005) provided users with Source: Glen Urban, 2005
  6. 6. Customer power further increased with Social Media / Web 2.0
  7. 7. Survey of We Media/Zogby Interactive : Internet primary source of news <ul><li>Nearly half of the survey respondents said their primary source of news now comes from the Internet. That’s an 8% rise on last year’s figures. Not only that, but websites were also cited as being more trustworthy sources, with almost a third (32%) saying they were the most trusted followed by newspapers (22%), television (21%) and radio (15%). </li></ul>BizReport Research : March 03, 2008
  8. 8. Question 1 What is Social Media / Web 2.0?
  9. 9. Web 2.0 / Social Media= User Generated Content
  10. 10. Web 2.0: Definition Web 2.0 is a collection of open source, interactive and user-controlled online applications expanding the experiences, knowledge and market power of the users as participants in business and social processes. Web 2.0 applications support the creation of informal users’ networks facilitating the flow of ideas and knowledge by allowing the efficient generation, dissemination, sharing and editing/refining of content. Source: Constantinides and Fountain, 2008
  11. 12. Source: Constantinides and Fountain, 2008 Web 2.0 Dimensions Application types/ Social Media Social Effects Enabling Technologies Blogs Social Networks (Content) Communities Forums/Bulletin Boards Content aggregators Empowerment Participation Openness Networking Conversation Community Democratization / User control Open Source RSS Wikis Widgets Mashups AJAX
  12. 13. Question 2 What are the effects of Web 2.0 on customer behavior?
  13. 14. Traditional Marketing Marketing in Web 1.0 environment Marketing in Web 2.0 environment
  14. 15. <ul><li>Social Media: Customer generates content </li></ul><ul><li>> talking and listening online, mistrusts our message, trusts peer opinion </li></ul>
  15. 16. The new consumer influencers <ul><li>Bizrate survey (2007): 59% of users consider customer reviews to be more reliable than those from experts </li></ul><ul><li>Study of Deloitte Touche USA: 62% of the US consumers read consumer-generated online reviews and 98% of them find these reviews reliable enough </li></ul><ul><li>80% of these consumers say that reading these reviews has affected their buying intentions </li></ul><ul><li>85% of consumers will recommend a company with which they have a trusted relationship (Carlson Marketing) </li></ul>
  16. 17. Question 3 What is the position of Web 2.0 as part of the (online) marketing strategy?
  17. 18. The E-Marketing Strategy Pyramid Product/ service Marketing/ E-Marketing Organization Web 1.0 Web site Web 2.0 Social Media Level 1 Level 3 Level 2 Level 4
  18. 19. Question 4 How Web 2.0 applications can be engaged as marketing tools
  19. 21. Corporate Options <ul><li>Option 1 </li></ul><ul><li>The Passive Approach/Listening-In </li></ul><ul><li>Option 2 </li></ul><ul><li>The Active approach </li></ul><ul><li>PR / Direct Marketing </li></ul><ul><li>Influence the New Influencers </li></ul><ul><li>Personalize Customer Experience </li></ul><ul><li>Tapping Customer Creativity </li></ul>
  20. 22. Corporate Options <ul><li>Option 1 </li></ul><ul><li>The Passive approach/Listening-In: </li></ul><ul><li>Using the Web 2.0 as intelligence source i.e. as source of customer voice and market information. </li></ul>
  21. 23. Sources <ul><li>Who talks about us online? </li></ul><ul><li>TIMES Online List with the 50 best business blogs, the Corporate Responsibility Group or Biz/ed </li></ul><ul><li>Nielsen Buzz Metrics </li></ul><ul><li>Technorati (, blog search engines like BlogPulse ( or the “index aggregator” TalkDigger ( ) </li></ul>
  22. 24. Corporate Options <ul><li>Option 2 </li></ul><ul><li>The Active Approach: </li></ul><ul><li>U sing Web 2.0 applications as PR, Direct Marketing and Customer Influence tool as well as means for personalizing the customer experience and tapping customer creativity. </li></ul><ul><li>4 alternative ways </li></ul>
  23. 25. Alt 1 <ul><li>Use Web 2.0 applications as PR and (Direct) Marketing tools seeking communication, interaction and customer feed back </li></ul><ul><li>Management Blogs: Jonathan Swartz , CEO of Sun Microsystems, Steve Jobs, CEO of Apple Computers and McDonalds Vice President Bob Langert etc </li></ul><ul><li>Employee blogs </li></ul><ul><li>Use Social Media as advertising channels or PR channels </li></ul><ul><li>Combine it with traditional media / interactive marketing </li></ul><ul><li>James Bond </li></ul><ul><li>SULTANA fun club in hyves </li></ul>
  24. 26. Alt 2 <ul><li>Find the (online) New Influencers and engage them as publicity channels: Identify, reach and inform them </li></ul><ul><li>Review, discuss, comment or recommend your product </li></ul><ul><li>How? Technorati Who are the New Influencers ? </li></ul>
  25. 28. Alt 3 <ul><li>Personalize customer experience (UGC) </li></ul><ul><li>http://coca- </li></ul><ul><li>LEGO </li></ul><ul><li>The Sun Online 2006 figures: is claiming 56 million new readers to its website, 1.2 billion page impressions and around 160 million individual readers http:// / </li></ul><ul><li>IKEA iederen = designer </li></ul><ul><li>Kleenex (, Heinz ( and M&M ( Our Pepsi Can Contest ( ) NIKE ( </li></ul><ul><li> </li></ul><ul><li>Configurators </li></ul>
  26. 29. Alt 4 <ul><li>Engage the user as co-developer. </li></ul><ul><li>I. Participatory Marketing: </li></ul><ul><li>Motivate amateurs who create viral films or TV commercials SONY, Frito-Lay’s, Sunkist or evaluate commercials ( Nespresso ) </li></ul><ul><li>II. Co-Creating Products: </li></ul><ul><li> LEGO , </li></ul><ul><li>Often Idea Competitions Peugeot: invited online car designs, 4 mil visitors. Demo model for exhibitions, in video game </li></ul><ul><li>Examples: RedisignMe , Dell, Nokia , Samsung , TomTom , HP , Talpa , Ilse, Google Android KLM , Starbucks , P&G , Robeco </li></ul><ul><li>III. Use personnel experience for better strategic decisions </li></ul><ul><ul><li>Prediction Markets </li></ul></ul>
  27. 30. Innovation Approaches Closed Innovation: company generates and commercializes ideas. Self-reliant R&D, Most of the 20 th Century R&D R&D R&D Partners Partners Open Innovation : Innovate in networks, company commercializes both its own ideas as well as innovations from other firms Chesbrough, 2003 Distributed Co-Creation: Participation of the final user User
  28. 35. How firms could profit from the Web 2.0 / Social Media movement? <ul><li>Deal effectively with the first 3 steps of the E-Marketing Pyramid </li></ul><ul><li>Approach Web 2.0 / Social Media as a Strategic opportunity </li></ul><ul><li>Review options (based on the large firm experience) </li></ul><ul><li>Engage Web 2.0 as passive and/or active Marketing tools </li></ul>
  29. 36. Thank you