Research reveals focus on integration, staffing, advertising, and measurement. By Jeremiah Owyang, Industry Analyst

1. 1 LeWeb Keynote December 9, 2010 Jeremiah Owyang Industry Analyst Social Business Forecast: 2011 The Year of Integration Research reveals focus on integration, staffing, advertising, and measurement.

2. 2 What happened in 2010 What’s going to happen in 2011 What companies should do about it Agenda:

3. Image by Slowtronused with Attribution as directed by Creative Commons http://www.flickr.com/photos/fuckr/91530309 2010 Overview © 2010 Altimeter Group

4. Just 2 years in corporate social business, 2010 was the year of formation.

5. Most Social Media programs report under Marketing or Corporate Communications

6. Companies organize for social in 5 ways

8. Authentic

9. Experimental

10. Not coordinated

12. Consistent

13. May not be as authentic

15. Business units undertake own efforts

16. Spreads widely around the org

17. Takes time

20. Unlike Organic, employees are organized

22. Maturity drives Total Budget, Team Size, and Org Model Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010 We asked 140 Corporate Social Strategists their total strategy budget, number of full-time equivalent staff dedicated to social media, and organizational model:

23. Maturity drives Total Budget, Team Size, and Org Model Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010 Corporations who are just getting started have miniscule budget and are significantly understaffed in a centralized team –this does not scale.

24. Maturity drives Total Budget, Team Size, and Org Model Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010 Corporations who have formalized their programs have a cross-functional team that lead and serve many business units with a larger budget line–they may not deploy on their behalf.

25. Maturity drives Total Budget, Team Size, and Org Model Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010 Mature and Advanced corporations have only slightly large budgets but involve many more across the company and are formed in Hub and Spoke, and often “Dandelion”

26. Image by ronni44052 used with Attribution as directed by Creative http://www.flickr.com/photos/ronnie44052/2730239605 2011 Forecast © 2010 Altimeter Group

27. 2011 is the Year of Integration

28. For Internal Goals In 2011, Social Strategists will focus on Measurement of ROI Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010 We asked 140 Corporate Social Strategists: “What internal social strategy objectives will you focus most on 2011?”

29. Social Strategists struggle with relying on engagement data We asked 140 Corporate Social Strategists: What measurements are most important to evaluating the success of your program? Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010

30. In External ‘Go to market’ a focus will be on integrating social onto the corporate website Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010 We asked 140 Corporate Social Strategists: “What external social strategy objectives will you focus most on 2011?”

31. 2010-2011: Adoption of Social Business programs We asked 140 Corporate Social Strategists their budget for 12 social business programs in 2010, and projected increases/decreases in 2011 to calculate adoption forecast: Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010

32. 2010-2011: Spending on Social Business programs We asked 140 Corporate Social Strategists their budget for 12 social business programs in 2010, and projected increases/decreases in 2011 to calculate adoption forecast: $278,000 $160,000 $129,000 $120,000 $108,000 $98,000 $90,000 $47,000 $47,000 $37,000 $23,000 $22,000 Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010

33. 2011 top spending by Company Maturity Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010 We asked 140 Corporate Social Strategists their budget for 12 social business programs in 2010, and projected increases/decreases in 2011 to calculate top spending by Company Maturity in 2011:

34. 2011 top spending by Maturity Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010 A small compartment of staff will be hired, scalable branded communities, and reliance on agencies which could help with monitoring.

35. 2011 top spending by Maturity Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010 Teams will continue to grow, but likely stymied by true ‘engagement’ brands may throw ad dollars and campaigns in order to scale –expect few to have maturity to truly engage.

36. 2011 top spending by Maturity Source: Survey of Corporate Social Strategists, Altimeter Group, November 2010 Expect the advanced to customize social media software and data, and then focus on engagement with social media agencies of record (SMAOR) –with less focus on advertising than the mature

37. Image by zetsonused with Attribution as directed by Creative Commons http://www.flickr.com/photos/zetson/254608875 How You Should Invest in 2011 © 2010 Altimeter Group

38. Invest in scalable social media programs 29

39. Hire correctly (Gurus/Ninjas/Samurai need not apply) and properly train for scale Integrate social media on the corporate website, then aggregate and curate Invest in advertising that leverages social graph Build an unpaid army of advocates –get your customers to do the work for you Invest in scalable systems like SCRM and SMMS Learn to measure using the ROI Pyramid Invest in scalable social media programs 30

40. Gurus, Ninjas, and Samurai need not apply Hire a program manager rather than a social media “hot shot.” Seek candidates with a track record of early technology adoption in their careers. Look for a corporate entrepreneur, comfortable with “calculated risks.” An internal resource to serve the entire enterprise. 1) Hire correctly and properly train for scale 31

41. 2) Pragmatically integrate social media on the corporate website, then aggregate and curate 32 8. Seamless integration 7. Social log-in triggers sharing 6. Users stay on site with social log-in 5. Aggregate discussion on site 4. Brand integrated in social channels 3. Link away but encourage sharing 2. Link away with no strategy 1. No social integration Source: http://www.web-strategist.com/blog/2010/05/19/slides-roadmap-for-integration-of-social-into-your-corporate-website/

42. 3) Invest in advertising that leverages social graph Advertising is the second highest social business program spend in 2010-2011 ($104,000 and $160,000) 48% of corporations plan to increase their spend in 2011 Focus on clear metrics Make ads engaging and tie to social graph –not just banners 33 Twitter’s advertising is a combination of both earned and paid –that results in WOM

43. Invest in Advocacy programs – they scale Research indicates a 5 step process Example: Microsoft has @4000 MVPs who are nominated by peers, employees and other MVPs; MVPs write books, articles, participate in user groups, host events, and answer community questions 4) Build an unpaid army of advocates –get your customers to do the work for you 34

44. SCRM connects the social web to your customer data bases, in 2010 to 1011 –budgets are small $19K to $37K (SCRM) but growing Most corporations don’t know they are implementing SCRM, as brand monitoring integrated with CRM applies Invest in Social Media Management Systems (SMMS) to help your brands scale. Forecast: $14K to $22K (SMMS) in 2011 spending Vendor short list: CoTweet, HootSuite, Sprinklr, Objective Marketer, Expion, SpredFast, or Seesmic 5) Invest in scalable systems like SCRM and SMMS 35

45. Learn to measure correctly Serve the right metrics to the right roles See: The Social Media ROI Pyramid 6) Learn to measure using the ROI Pyramid 36

46. ROI Pyramid: Roles View Provide the right metrics to the right audience. A novice mistake is to provide ‘engagement metrics’ to executives

47. The ROI Pyramid: Metrics View These metrics are formulas comprised of the tier below them. Currently, there is no industry standard.

48. The ROI Pyramid: Metrics Examples (there are more) A junior mistake is providing ‘engagement data’ to executives –instead focus on business metrics.

49. The ROI Pyramid Role: Metrics: Specific Data (examples)

50. 2010 was the read of Foundational Investments. In 2011, expect to see a focus on Measurement, Integration, Staffing and Advertising. Invest in Scalable Programs that leverage your crowds –1:1 dialog does not scale. Summary 41

51. This research is published under the spirit of Open Research, use it, reference it, and build on it. The more you share the more we can conduct, spread it widely. Our papers are published under non-commercial Creative Commons – you are free to use our research, with attribution to Altimeter Group. Open Research 42

52. 43 Jeremiah OwyangIndustry Analyst jeremiah@altimetergroup.com web-strategist.com/blog Twitter: @jowyang Research team includes significant contributions from Christine Tran, and Charlene Li, Altimeter Group