The Business Value of Social Media Monitoring by @DrNatalie Petouhoff

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Wondering how social media affects your business? Wondering if you should use social media monitoring and listening tools? In this presentation is a case study on how Netflix didn't listen to social media sentiment and made business decisions that caused the stock price to drop dramatically.

It also analyzes Blockbuster and some ways that they also could have used social media monitoring to prevent bankruptcy and also how they did use it to capture some of the Netflix customers who were looking to leave.

The data in the case study is from Sysomos and provides not just data, but shows how social media data provides business insights that impact business decisions.

Included is John Boyd, a former fighter pilot and the creator of the OODA Loop - Observe, Orient, Decide & Act process. How this applies to business is --determining whether businesses are using social media data --like fighter pilots use data-- to be agile and make critical decisions in seconds vs using data on a yearly basis to evaluate the direction of the company.

Companies can't afford to miss these points but many do. Don't let your company be one of them that doesn't OODA!

For more information and a white paper on this topic, check this out: http://www.drnatalienews.com/blog/ooda-loop-and-how-to-use-social-media-for-business-part-5

@drnatalie
www.drnatalienews.com
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The Business Value of Social Media Monitoring by @DrNatalie Petouhoff

  1. 1. Value Of Sentiment by @DrNatalie PetouhoffLecturer, Anderson School of Business – UCLA Business Strategist & Consultant Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  2. 2. A frame of reference… A path to analyze…A process to create a structure in an unstructured world… Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  3. 3. The Acceleration of Social Media Success Step 6: Gaining Organizational Alignment Using all previous steps, decide how the company .Step 3: Finding Your Audience will interface with each other and the customer in aUsing social media monitoring to understand socially dominate world.their audience and use that data to makedecisions about constructing the rest of theirsocial media program Step 5: Designing Interactions Using social media monitoring, listening, audience and content analysis, develop interaction strategiesStep 2: Measurement and plans for all function departments- individuallySet-up business goals, measurement, metrics, and to work together synergistically.benchmarks to use in models to measureprogress & ROI. Step 4: Creating EngagingStep 1: Monitor & Listening Contentuses social media monitoring to listen to customer Using social media monitoring, audience analysis,conversations and uses it to make business decisions. create content that will engage target audiences. Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  4. 4. Social Business StrategyStep 1: Monitor & Listen• How well does the brand know their target audiences?• What’s the benchmark for sentiment and share of voice compared to competitors? Step 3: Level 6: Organizational Audience Alignment• What is the company doing Step 2: Step 5: Interaction well? Measurement Level 4: Content• What would be better if? Step 1: Monitor & Listen Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  5. 5. The more things change,the more they stay the same Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  6. 6. Go back in time…People were predicting this… There would be A place in time Where the customer would in charge of the message … And there would be an enabling technology We are here now… This is your opportunity…
  7. 7. As an engineer I… Go back further…Many scholars had advocated to listen to customers, employees, partners.. "Long-term commitment to new learning and new philosophy is required of any management that seeks transformation. The timid and the fainthearted are doomed to disappointment.“ -- W. EDWARDS DEMING
  8. 8. The Boyd Affect Meet John Boyd (military strategist) Colonel and Fighter Pilot His theories highly influential in the:  Military  Sports and  Business.
  9. 9. The Boyd Affect He is known for:  Decision Cycle  Conceptual Spiral How does this apply to business?
  10. 10. Boyd created the OODA LoopIt’s how we generate the new actions & ideas we need to thrive and growin an uncertain and competitive world. Note to self: Sounds like something we could use to deal with the changes social media is bringing to companies
  11. 11. The Boyd Loop: OODA Observe: the collection of data  Make use of the best sensors and other intelligence available
  12. 12. The Boyd Loop: OODA Observe: the collection of data  Make use of the best sensors and other intelligence available Orient: analysis and synthesis of data  Put the new observations into a context with the old
  13. 13. The Boyd Loop: OODA Observe: the collection of data  Make use of the best sensors and other intelligence available Orient: analysis and synthesis of data  Put the new observations into a context with the old Decide: determination of a course of action  Select the “next action” based on combined observation and local knowledge
  14. 14. The Boyd Loop: OODA Observe: the collection of data  Make use of the best sensors and other intelligence available Orient: analysis and synthesis of data  Put the new observations into a context with the old Decide: determination of a course of action  Select the “next action” based on combined observation and local knowledge Act: acting on those decisions  Carry out the selected action, ideally— while the competitor is still observing your last action
  15. 15. How fast does your company OODA? Do you have systems to monitor/measure: What customers know, think & feel? What employees know, think & feel? Do you take that information and integrate it into your company? Sounds like what Deming said to do!
  16. 16. Most Companies Don’t Listen or Integrate FeedbackCollect Alert Use ImproveTellFeedback Staff Insight Customers
  17. 17. Now consider two companies…How fast do you OODA compared to your competitors? Company 1 Company 2  United Airlines (United Breaks Guitars  Zappos
  18. 18. If Company 1 OODAs faster than Company 2 Company 1 Company 2 You’ll have a decided time advantage over their competitor
  19. 19. Are You On Track? In military operations, OODA takes place in seconds In corporations, its much slower if at all Strategy is rigidly followed till next years’ planning cycle It’s critical to validate we’re on track Or correct things Especially in the Age of Social Business
  20. 20. It not jus about OODAing Once It’s the OODA LOOP:The results of your actions become the observations to re-orient you to make your next decision Repeated OODA = Success
  21. 21. Social Media Monitoring Is A Wayto OODAStep 1: Monitor & Listen• How well does the brand know their target audiences?• What’s the benchmark for sentiment and share of voice compared to competitors? Level 6: Organizational Step 3: Audience Alignment• What is the company doing Step 5: Interaction Step 2: well? Measurement Level 4: Content• What would be better if? Step 1: Monitor & Listen Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  22. 22. What happens to brands that don’t…. – That don’t do social media monitoring to understand their audiences? – Understand what the customer is saying in social networks? – That don’t collaborate cross functionally on social media? – That don’t adopt social media? Your brand: Fractured Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved 22
  23. 23. It’s not that uncommon that a companylooses it’s way…September 23, 2010• Blockbuster Video went into bankruptcy• Why?• Competition by companies like Netflix• But what happens if a company like Netflix doesn’tunderstand social media? Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved 23
  24. 24. What could havehelped Netflix?Social Media Monitoring The brand’s sentiment & Using it to OODA 24 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  25. 25. Blockbuster 2010How to use social media monitoring to understand social media conversations Sentiment towards Blockbuster* 33% + 36% - *Social Media Monitoring Data from Sysomos 25 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  26. 26. Blockbuster 2010- social media conversations Sentiment towards Blockbuster* 33% + 36% -Key customer issue: Late fees *Social Media Monitoring Data from Sysomos Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  27. 27. Blockbuster 2010- social media conversations Sentiment towards Blockbuster* 33% + 36% - If Blockbuster was listening, they would have had strategic business data to make business decisionsKey customer issue: Late fees *Social Media Monitoring Data from Sysomos 27 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  28. 28. Blockbuster Demise & Netflix Rise 2010 But Blockbuster did not listen or change course and had to file bankruptcy *Social Media Monitoring Data from Sysomos 28 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  29. 29. Customer SentimentFor Blockbuster’s Bankruptcy, Sept 2010Negative customer conversations in social media *Social Media Monitoring Data from Sysomos 29 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  30. 30. Flash Forward to July 12, 2011 Was Netflix listening? Click on the graph tosee what the spike was about & gain insight into what’s being said in social media *Social Media Monitoring Data from Sysomos 30 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  31. 31. Flash Forward to July 12, 2011 Was Netflix listening? CEO’s Facebook *Social Media Monitoring Data from Sysomos 31 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  32. 32. Flash Forward to July 12, 2011 Was Netflix listening? CEO’s Facebook81,789 Comments 1,429 Positive 80,360 Negative *Social Media Monitoring Data from Sysomos 32 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  33. 33. Flash Forward to July 12, 2011 Was Netflix listening? CEO’s Facebook wordcloud*Social Media Monitoring Data from Sysomos 33 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  34. 34. Flash Forward to July 12, 2011 Was Netflix listening? CEO’s Facebook Related words: • Increase • Angered • Cancelled • Drop • Greedy • Redbox *Social Media Monitoring Data from Sysomos 34 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  35. 35. An Example of Not Hearing… 35 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  36. 36. An Example of Not Hearing… 36 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  37. 37. An Example of Not Hearing… 37 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  38. 38. What happens when you don’t listenor hear what the sentiment is & you act without considering what customers think, feel and know 38 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  39. 39. Despite the negativecomments from July 12, 2011 Sept 19th, 2011 Netflix sent out a notice on the price hike… and the results were… 39 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  40. 40. Press Coverage Qwikster (Netflix’s new offering) Sept 19th, 2011 40 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  41. 41. But it was Negative Press Coverage 41 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  42. 42. Qwikster (Netflix’s new offering) Sept 19th, 2011wordcloud 42 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  43. 43. Netflix did not even checkthe twitter handle-- @Qwikster Information about the twitter handle @Qwikster Example tweet from @Qwikster This is NOT “on brand” Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved 43
  44. 44. Qwikster (Netflix’s new offering) Sept 19th, 2011Three top words in theBuzz Graph?• Reed• Hastings• Apologize 44 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  45. 45. 45Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  46. 46. Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved 46
  47. 47. Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved 47
  48. 48. Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved 48
  49. 49. Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved 49
  50. 50. Blockbuster was listening & hearing! Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved 50
  51. 51. DOES SOCIAL MEDIA Sentiment MATTER? Netflix: LOST 800,000 CUSTOMERS Could your business withstand that?Would your business want to? Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved 51
  52. 52. Where’s your company on thesocial media adoption curve? Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  53. 53. Some companies don’t see social media asthe key to: • Innovation • Change • Retaining customers • Acquiring new customers • Gaining a competitive advantage… It’s the NEW Reality Check for: • PR Brand Promises • Marketing Messages • Sale Promises • Engineering, Manufacturing Delivery… • Customer Service / Customer Retention
  54. 54. Where did NetFlix Miss fire in OODAing? Did they • Observe? • Orient? • Decide? • Act? In ways that forwarded their business? They did the opposite- Lost customers Cost the company in customer service calls
  55. 55. What’s it gonna take for… The whole industry to understand how important social media is? What is it gonna take for change to happen?
  56. 56. Are You An OODA Leader? Your job as a leader is to OODA faster than your competitors • Outmaneuver the competition • Observe the ever-changing conditions and • Decisively act in an effort to beat the competition
  57. 57. Are you a OODAing Leader?• Leaders needs to: • Evaluate social sentiment • Have the courage to recognize when things are off course • Know when a correction is needed and • Then act decisively When would “now” bea good time to be aOODA Loop Leader?
  58. 58. A decision: selection between possible actions DECIDE Do you have the social media data to make the right decisions?
  59. 59. May be it’s a good idea to:• Listen to your customers• To know what’s being said• To use the social media data to inform business decisions• To use social media to interact with customers & have it result in a positive outcome?!?!? Things that make you go HMMMM… 59 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  60. 60. The Acceleration of Social Media Success Step 6: Gaining Organizational Alignment Using all previous steps, decide how the company .Step 3: Finding Your Audience will interface with each other and the customer in aUsing social media monitoring to understand socially dominate world.their audience and use that data to makedecisions about constructing the rest of theirsocial media program Step 5: Designing Interactions Using social media monitoring, listening, audience and content analysis, develop interaction strategiesStep 2: Measurement and plans for all function departments- individuallySet-up business goals, measurement, metrics, and to work together synergistically.benchmarks to use in models to measureprogress & ROI. Step 4: Creating EngagingStep 1: Monitor & Listening Contentuses social media monitoring to listen to customer Using social media monitoring, audience analysis,conversations and uses it to make business decisions. create content that will engage target audiences. Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved
  61. 61. Thank you! @drnatalie petouhoffwww.drnatalienews.com 61 Copyright © 2012 @DrNatalie Petouhoff The Social Business Course™ ® © All Rights Reserved

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