In the June 1st issue of BusinessWeek, the cover story asks the question “What’s a Friend Worth?” Specifically, it looks at how “Companies are working fast to figure out how to make money from the wealth of data they’re beginning to have about our online friendships.”
Two parts of the story really jumped out to me.
“Paths of Influence” are vitally important for Brand Managers
First, I am fascinated by the work that people like danah boyd at Microsoft Research and Cameron Marlow at Facebook are leading in social interactions. As a Brand Marketer, a large part of your job is understanding “paths of influence”…or in other words, the ways that consumers are persuaded to buy your product. In the old world, we blasted a TV or print ad to as many people as possible in the hopes that a few of them would buy our product. But in this digital world, if you can really understand the path to influence, you can more effectively target people based on their interests and influences.
That is the reason companies like Microsoft and Facebook are hiring leading sociologists and anthropologists to better understand online friendship and its impact on brands. Social networks provide a wealth of data about social interactions and friendships. Someone in that data is buried the answers on how people influence others to buy… and it is a race to see which digital giant figures it out first.
Networked “friends” create tremendous personal opportunity
The second part of the story that jumped out to me was the short mention of “personal opportunity” being the business value of networked friends. As the article states:
…friends online represent a turbocharged Rolodex for entrepreneurs and job seekers inside and outside companies. These collections of contacts expand social horizons, keeping us in touch with more people who can provide ideas, answers, business leads, and even legal advice. Those who master these connections stand to win a big edge: the connections and brainpower of a large team.
I personally believe this is a point that is misunderstood by the majority of marketers and Brand Managers out there. I carefully manage my connections on LinkedIn, Twitter, and Facebook because I have come to realize that my personal network is my single biggest competitive advantage in marketing. In fact, often when I returned from a business trip, the first thing I do is send a LinkedIn request to anyone I met while on the road. That is how much I believe in the power of the network. This digital network of professional contacts allows you to instantly see when someone changes jobs, gets promoted or moves to a new city. And with that increased visibility, you can more easily see how you can be of help to your network AND how your network can be of help to you. That is abenefit that no one should under-estimate.
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- Microsoft’s danah boyd on friendship (businessweek.com)
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Tags: Business Week, Friendship, Social Networking
Nice assessment of a fascinating article, Dave. The study of 'paths of influence' should be rich territory up ahead.
I thought the credit score finding was a good demonstration of the power of friendship networks: That someone with a 550 score can be treated more like a 600 if they're friends are at that level. Thus the person's friendship network would be having a considerable influence over their financial standing, including purchases.
Thanks for the post.
I definitely agree with you that there is incredible power among friends to spread the message of a brand, but I wonder how social networks like Facebook can really capitalize on it. In fact, I think their attempts to capitalize on friend recommendations has backfired.
Social networks are conversation tools similar to the telephone, and people do not typically respond well to advertisements on such platforms. For many it almost feels like an invasion of their personal space and life. There is an interesting article that you might want to read about the end of Facebook that I found very interesting, let me know what you think:
http://www.hardknoxlife.com/2009/05/23/businesswe...
Hey Dave,
Hope things are well with you.
I came across something today in Forrester, and I immediately remembered this post.
"Coca-Cola recently used SocialMedia.com's WOMI product, which features a "social advertising engine" that identifies the influential friends within a social graph to generate positive word of mouth for brands or products. Result: a 33% increase in purchase intent for Coca-Cola's cherry Coke brand in one week."
Seems SocialMedia.com has a tool capable of identifying "paths of influence." It'd be interesting to actually see this tool in action and understand its depth. Have you had any experience with it yourself?
Thank you for the post. I had missed that article and it makes you stop and think. Your practice of connecting online with everyone you meet on a business trip is smart. I used to travel for my job A LOT and I didn't do that. Now, I really really regret it. I'm trying to back track and hope they remember me now. It's tricky. Good post. I linked this blog post to a column of mine on the Examiner.com. Thanks for the insight!
I learned a lot from this article and will definitely save it in my RSS. Thanks for the effort you took to delve into this matter so deeply. I look forward to future posts.