Business AnalyticsIBM SoftwareSocial Media Analytics –Making Customer InsightsActionable
2Social Media Analytics – Making Customer Insights ActionableOverviewMuch has been said about the growth of social media –...
•	 Integrate information across different data sources to drivethe business through deeper consumer insight;•	 Define what...
Social Media Management – StrategicConsiderations for Marketing and ITMarketers have embraced social media enthusiasticall...
Below are general questions that reflect various levels of adoptionof social media, from an initial assessment to a more c...
Cognos Consumer Insight helps you:•	 Understand your customers’ needs and target new marketingcampaign offers and products...
Applying Predictive Capabilities to SocialMediaFundamentally, social media analytics provides a broader viewof the consume...
YTW03168-USEN-00© Copyright IBM Corporation 2011IBM Canada Ltd.3755 Riverside DriveOttawa ON K1G 4K9CanadaProduced in Cana...
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Social media analytics – making customer insights actionable


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Much has been said about the growth of social media – its multiple channels and the enormous scope of its content and subject matter. Social media seems to offer something for everyone. With the proliferation of mobile devices, social media is available everywhere and its impact is immediate.
One need look no further than the daily headlines to see that what began as an innocuous technology trend only a few short years ago has become a powerful instrument of social change.

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Social media analytics – making customer insights actionable

  1. 1. Business AnalyticsIBM SoftwareSocial Media Analytics –Making Customer InsightsActionable
  2. 2. 2Social Media Analytics – Making Customer Insights ActionableOverviewMuch has been said about the growth of social media – itsmultiple channels and the enormous scope of its content andsubject matter. Social media seems to offer something foreveryone. With the proliferation of mobile devices, socialmedia is available everywhere and its impact is immediate.One need look no further than the daily headlines to see thatwhat began as an innocuous technology trend only a few shortyears ago has become a powerful instrument of social change.In the business world, social media is now a powerful marketingtool that seems to find new uses and new users with each passingday. It can be deployed to share news from a corporate eventon a near real-time basis, or create a buzz about a great newproduct within minutes of its launch. Or it can be used to sharethe details of an unpleasant experience with customer servicejust as fast.This white paper will examine the role social media can play inpresenting a more strategic view of customer data and how theright combination of technologies can deliver insight to helpcompanies more effectively meet perpetually shifting consumerdemands expressed through, and influenced by, these dynamiccommunication channels. We will look at the implications formarketing and sales, but also IT. And we will consider how andwhy social media tools and applications can be integrated withexisting technology investments.Marketing Digitization – Following theConsumerSocial media is re-shaping the way organizations engage theircustomers and nurture their relationship to brands, productsand services. Here are some figures that give an idea of the scaleof the social media phenomenon:• 770 million people worldwide have visited a socialnetworking site.¹• 500 billion impressions about products and services areannually shared online by consumers.²• More than 60% of those impressions are shared onFacebook®, with 16% of users generating 80% of themessages and posts about products and services.³• 78% of consumers trust peer recommendations.4For marketers, a good portion of social media’s value lies in itsability to aggregate communities of interest, identify specificdemographics and thus enable marketers to precisely segmentand engage their audience. The goal is to monetize theseoutputs – to capture the interaction with a brand, productor service, and distill from this information the drivers ofpreference and ultimately purchase.A social media strategy, then, seeks to carefully balance messageand media with specific consumer segments. We can do thatbecause we now have the technology to capture consumerpreferences and opinions expressed through social media andapply predictive capabilities to identify new opportunities anddetermine patterns and propensities to influence and advocate.We can then act on this insight by integrating it with one-to-onemarketing automation solutions to pinpoint campaigns to specificsegments, driving consumer advocacy and ultimately revenue.As one chief marketing officer (CMO) of a leading consumerproduct goods company has said, we are moving from a “sprayand pray” marketing approach to one that can aggregateconsumer data and precisely deliver messages and content.The mistake many organizations make, however, is to treat socialmedia as distinct and separate from other customer data anddivorced from revenue generating imperatives. What separatesthe winners and losers in the social media space is the ability to:2
  3. 3. • Integrate information across different data sources to drivethe business through deeper consumer insight;• Define what your brand is worth – its equity, reputation andloyalty – at any moment anywhere in the world; and,• Understand emerging consumer trends and apply predictivemodels to determine actions with the highest probability toincrease relevance and maximize ROI of marketing campaigns.The time to act is now. Indeed, as a result of social media’srapid growth, recent years have seen an accelerating shift inmarketing spending away from traditional channels such asprint and broadcast to digital channels. This transformationis being driven by the cost advantages and precision offered bydigital marketing platforms. Of particular note is the growingarea of applications to manage the increasing volume andinfluence of social media, which was estimated to representroughly $300M in marketing spending in 2010.5As social media becomes a standard component of mostorganizations’ marketing mix and a source of rich customerinsight, its spend is being scrutinized, with better justificationand metrics required to engage a vast social media landscape.This analysis requires a rich analytics environment, one whichis transformative in its ability to offer a consolidated, globalview of customer data and deliver actionable insight.Social Media – A Catalyst for RicherCustomer InsightLike any source of customer data, social media requires anunderstanding of a customer’s life cycle within your organizationin order to establish sign posts to indicate different methodsof engaging them at different points in the relationship. Thesesign posts act as a roadmap to help your organization knittogether a comprehensive view of how a given customer’s actionsare reflected across multiple purchasing channels, within thecompany’s functional silos, in disparate information systemsand in key performance indicators.With a comprehensive customer view, organizations can deriveinsight about customer segments and behavior to fuel organicgrowth through improved retention and cross-sell and up-sellopportunities. The organizations can put trusted informationinto the hands of frontline employees to improve productivityand customer service and enhance the customer experienceacross all sales channels.Social media can be a catalyst to help companies achieve:• Influence and intimacy. Social media amplifies the“relationship” in customer relationship management (CRM).Consumers trust their peers. And companies have the abilityto aggregate and segment consumer data fairly easily.• Scale and speed. Social media channels enable marketersto reach more customers faster, dynamically, and with greaterprecision. It can take months of planning, creative developmentand media purchases to launch a print ad campaign, comparedto the immediacy of Twitter®and Facebook campaigns.• Lower costs. Social media offers dramatically lower costs toprecisely target and engage audiences across multiple channels,segments and geographies.Social media allows organizations to connect and engageconsumers in a unique way, but also personalize and monetizecustomer relationships on a sustained basis to ultimatelyimprove profitability. Social media also provides a path toricher customer analysis, using technologies capable offunneling and consolidating customer insights. Organizationscan use these insights to dynamically calibrate, anticipate andoffer products and services that meet perpetually shiftingconsumer demands in a hyper-competitive marketplace.Business Analytics33
  4. 4. Social Media Management – StrategicConsiderations for Marketing and ITMarketers have embraced social media enthusiastically, for themost part. In a study by Forrester Research, 54% of companiessurveyed say that marketing “owns” social media strategy. Butnearly one fifth of organizations don’t have a single designatedowner of their social media strategy and only 20% havecentralized their social media deployment.6This means apotentially fragmented corporate view, with outcomes interpreteddifferently by each group – from public relations, to marketresearch to sales, to others. That should give IT and the restof the organization pause, because it means that there may belittle coordination in the selection of social media vendorsor consistency in the analysis of social media data.For marketing to create a more universal view of customer data,there’s a pressing need to facilitate the management of socialmedia technology and clarify its relationship to corporateperformance. IT can help guide the integration of social mediastrategy and technologies into the wider enterprise. IT hasan opportunity to influence both the short-term needs andlong-term requirements and integrate social media applicationswith the operational systems that provide reporting and analysisof business performance.As companies move from tentative early experiments with socialmedia to a more systematic approach, data integration andaccompanying skills become paramount – especially if thereis a desire to connect social media tools and technologies tobusiness processes and supporting IT infrastructure. Socialmedia can have a wide impact on an organization’s differentfunctions, requiring a cross-functional approach to its adoptionand management – which includes a close partnership withmarketing and IT.Indeed, IT can help in the selection of social media tools to helpgroups like market research be confident that the data they viewis accurate and validated. IT can ensure smooth integrationbetween unstructured and structured pools of data for analysis,such as unstructured social media data and structured datafrom a company’s transactional databases. As Forrester Researchobserved, “firms expect this data to conform to the high qualityand reliability standards that they expect from their traditionaldata sources.”7Ray Wang of Constellation Research makes the point that,as guardians of data and its distribution within the enterprise,IT has ample opportunity to be engaged in social media strategy.Wang points to the need for executive support and internalcollaboration in terms of both functional and cross-functionalrequirements. This is where IT can remind marketing of thewider opportunity to link social media strategy to existing ITpoints of integration, as well as consulting on vendor selection.8Social Media Readiness: Key PerformanceQuestionsAnd yet, Not all organizations are equally ready to use socialmedia. Very often a company may start with little agreementon appropriate metrics and their relationship to businessperformance. There may be a proliferation of social mediavendors for each functional area within marketing, and onlyrudimentary analysis of social media sentiment and other areasof analytics. This affects an organization’s ability to extendtheir analysis, such as the capacity to apply text mining andpredictive capabilities to social media data.The level of maturity shapes the questions marketers needto ask themselves, and is largely based on how aggressivelythey have engaged social media and applied analytics to theirinvestment in these channels.Social Media Analytics – Making Customer Insights Actionable4
  5. 5. Below are general questions that reflect various levels of adoptionof social media, from an initial assessment to a more complexeffort to integrate social media insight into customer processes.Assess• What are your customer objectives? Are you looking to:–– Attract customers–– Increase the value of existing customer relationships–– Retain customers• How do customers interact with you today?• What are they interested in?• Where and when do they use social media?• Are there significant influencers who speak to your brandor products?Measure• Who are you targeting with your social media initiativesand why?• What will you be measuring:–– Share of voice–– Activation–– Brand sentiment–– Influencers• Sales over the life of the customer relationship?Integrate• What is your vision for social media and its integration intooperational marketing systems?• Do you have a profile of your customer advocates? Can youpredict sentiment on products, services, campaigns?• How do you measure the effects of social media on brandequity and reputation, pipeline, and sales orders and margins?• How will you integrate social analytics into other customeranalytics?Regardless of the sophistication and scope of the social mediainitiative, the end goal is alignment with corporate imperativesand goals, and a measureable return on investment.IBM Cognos Consumer Insight – SocialMedia AnalyticsIBM Cognos®Consumer Insight enables rich analysis thatprovides insight into consumer behavior and intentions. Theproduct is a purpose-built social media analytic applicationcapable of analyzing large volume of Internet content. Itenables marketing professionals to transform their customerrelationships by actively incorporating consumer sentimentand sophisticated analytics into the business and marketingstrategy of their organization, helping them be more precise,agile and responsive to market demands.Cognos Consumer Insight works by analyzing content drawnfrom publicly available websites in the form of fragments or“snippets” of text that contain the user’s search terms. Thesnippets reside in a database which can be further searched andanalyzed using dimensions such as date, region or keyword, thetone of the feedback, and other factors to provide insight intoconsumer attitudes toward your brand, products and services.Cognos Consumer Insight then automatically identifies andtags relevant content and processes your analysis results basedon relevance to products or business issues. It helps you expandyour analysis by offering related topics beyond your initial searchand also enables you to communicate your insights acrossthe business with collaborative tools.Business Analytics5
  6. 6. Cognos Consumer Insight helps you:• Understand your customers’ needs and target new marketingcampaign offers and products more cost-effectively throughdifferent channels – to grow your business.• Make evidence-based messaging decisions to enhance yourreputation with both customers and constituencies such asemployees and the communities where company facilitiesare located.• Respond more quickly to customer requests, improve serviceand customer care, and ensure a consistent customerexperience across all channelsThese rich capabilities are coupled with a user-friendly analyticsinterface that includes pre-built reports and seamless integrationwith IBM Cognos Business Intelligence to let you performmore sophisticated analysis.Social Media Analytics – Making Customer Insights Actionable6How Does IBM Cognos Consumer Insight Work?Process contentbased on relevanceto business•Communicate insightbroadly across thebusiness•Automaticallyidentify and tagrelevant contentAnalytics Platform•Crawl•InformationExtraction•ComputeInfrastructure•Admin UserInterfaceWeb contentMultiple Languages3rdParty ProvidersInteractiveVisualization &Analysis•Database•Semantic &FacetedSearch IndexSearch-ledDataExplorationCognosReports &AnalyticsIntegrated UIGilsbert van der Sleen
  7. 7. Applying Predictive Capabilities to SocialMediaFundamentally, social media analytics provides a broader viewof the consumer and increases the ability of an organization tosee new patterns and opportunities. More importantly, it allowsmarketers to peer into the customers’ “voting record” – thedigital footprints of their countless decisions. It has the powerto tell us who they are and what matters to them. And, as a result,it provides marketers with a new way to present customerswith options and experiences they can’t resist.So what are the implications for your customers? By combiningsocial media data with predictive capabilities, organizations cango beyond 1-to-1 marketing, building marketing campaignsnot only targeted at specific customer segments, but deliveredat the right time, through the right channel, and with the offermost likely to be accepted. Understanding the key concerns ofa particular segment enables you to build “intervention” offersor messages designed to assuage and mitigate customer issues,preventing churn and making customers more loyal and profitable.In this context, we can use social media data to begin a moredetailed analysis of the consumer and combine it withdemographics, preferences, behaviors and interests, usingthe sophisticated text analysis and predictive capabilitiesof IBM SPSS.For example, we can treat social media as a data source, as wedo other customer data. In this scenario, Cognos ConsumerInsight content (in the form of the text “snippets” mentionedearlier) is stored in a searchable database and then fed into apowerful text analytics platform, which enables us to determinecategories and groups of consumers. We can then survey identifiedsegments, such as those identified as advocates or social leaders,to ascertain demographics, interests and preferences.From here, we might compare them against existing segmentsin a customer database to gauge potential reaction to new offers.This insight allows us to confirm new trends we can apply toexisting customers for targeted campaigns to support viralmarketing to specific segments with special offers to encourageadvocacy. A recent story in the business press, for example,described a cosmetics company that identified online advocatesfor a particular brand of eyeliner. In advance of a new launch,this company sent product kits to these advocates, who, shortlythereafter, created viral buzz for their stores during a muchlarger new product launch.In this type of situation, Cognos Consumer Insight could helpdescribe the current state of your brand as seen through thelens of social media. But then IBM takes the process further,with SPSS predictive analytics. SPSS takes the descriptiveinformation from Cognos Consumer Insight and adds predictiveand prescriptive capabilities to provide guidance on what actionyou should take in response to what you have learned, such asdiscerning new customer segments, predicting sentiment andapplying propensity models on the likelihood of specificcustomers to be advocates.Social Media Analytics – Making InsightActionableSimply listening to customers on social media is not enough.Listening is a starting point. But the end goal is revenue.Those organizations best able to differentiate themselves havean ability to incorporate social media analytics into theircustomer and marketing automation processes, to monetizetheir investments and integrate insight into their customerdata. This provides a foundation from which organizations canlink measurement and the tactical execution of social mediastrategies to the imperatives of revenue generation.But this isn’t just for marketers. It must involve cross-functionalteams, such as IT and product teams that help the organizationcreate relationships, build advocacy and improve loyalty – allwith the goal of driving revenue. Social media provides themeans to do just that. And an integrated business analyticsapproach provides additional depth to capture, analyze andact on this insight.Business Analytics7
  8. 8. YTW03168-USEN-00© Copyright IBM Corporation 2011IBM Canada Ltd.3755 Riverside DriveOttawa ON K1G 4K9CanadaProduced in CanadaMay 2011All Rights ReservedIBM, the IBM logo and are trademarks or registered trademarks of InternationalBusiness Machines Corp., registered in many jurisdictions worldwide. Other productand service names might be trademarks of IBM or other companies. A current list ofIBM trademarks is available on the Web at “Copyright and trademark information”at in this publication to IBM products and services do not imply that IBMintends to make them available in all countries in which IBM operates.P26317About IBM Business AnalyticsIBM Business Analytics software delivers actionable insights decision-makers need to achieve better business performance. IBM offers acomprehensive, unified portfolio of business intelligence, predictive andadvanced analytics, financial performance and strategy management,governance, risk and compliance and analytic applications.With IBM software, companies can spot trends, patterns andanomalies, compare “what if” scenarios, predict potential threats andopportunities, identify and manage key business risks and plan, budgetand forecast resources. With these deep analytic capabilities ourcustomers around the world can better understand, anticipate andshape business outcomes.For more informationFor further information or to reach a representative please visit a callTo request a call or to ask a question, go to An IBM representative will respond to your inquirywithin two business days.Please Recycle1 comScore, Social Networking Phenomenon, 20092 Josh Bernoff, Ted Schadler, Empowered: Unleash yourEmployees, Energize your Customers, Transform yourBusiness, Harvard Business Review Press, 20103 Ibid4 Sean Corcoran, The Broad Reach Of Social Technologies,Forrester Research, August 25, 20095 WG Analysis, Winterberry Group, October, 20106 Jeremiah K. Owyang, How to Organize Your Company forSocial Media, Forrester Research, June 24, 20097 Zach Hofer-Shall, Suresh Vittal, Emily Murphy, AllisonSmith, The 2011 Listening Platform Landscape, ForresterResearch December 14, 20108 Ray Wang, Best Practices: Applying Social BusinessChallenges to Social Business Maturity Models,Constellation Research, 2011