Is Twitter Really Good for Brand Advertisers?

The following post was originally written as a guest post for Rob Go from NextView Ventures.

As LinkedIn, Zynga, Groupon and other Web 2.0 darlings file to go public, we begin to get a glimpse into the financials behind these companies.  This naturally leads people to speculate on the still private financials of other Web 2.0 leaders such as Facebook and Twitter.  Twitter in particular is an interesting one given that they raised another $800 million at an $8.4 billion valuation.  This valuation is for a company with 200 million users and estimated revenues of around $200 million, equating to a steep multiple of 40 times sales for the microblogging service.

If Twitter is going to prove deserving of this valuation, their success will be directly tied to brand marketers continuing to embrace the service, especially with their ads platform.  In other words, Twitter needs marketers to spend money with them, and in order to do so, it must prove that it is an “effective” tool in the marketing mix.  It is that word “effective” that often proves the stumbling block in these digital discussions, largely due to how the word is misunderstood and in turn, misused.

Generally speaking, when a brand marketer talks about a tool being effective, they are referring to the ROI it generates.  For the most sophisticated marketers, this is accomplished through Marketing Mix Modeling where they can directionally attribute a dollar spent to the short-term return in sales. To further explain this, Forrester has a great overview on the subject.  Direct marketers and retailers take a more direct path in ROI, directly attributing sales to a particular channel. A prime reflection of this is how Dell can claim to have sold $6.5 million through Twitter in 2009 (though it is surprising that Dell has not shared any additional information since 2009, especially given the growth of Twitter’s audience).

Effective can also refer to how well a tool works in the Marketing Funnel.  The traditional funnel includes Awareness, Consideration, Preference, Action and Loyalty, though some marketers have reclassified that funnel to instead include Acquire, Engage and Convert.  If a tool is effective in the Marketing Funnel, it means that it allows a brand to succeed in driving one of these strategies.  For instance, TV – or any mass media for that matter – has proven to be an effective tool for driving awareness for years, thus the reason that Super Bowl ads that are known to effectively do this with a very large audience.

So with this definition in mind, the question that naturally arises is if Twitter can be an effective tool for marketers.  For me, I am bullish overall on the potential for Twitter to be effective across each area step in the “Marketing Funnel”.

Twitter’s Role in Acquire

Twitter is a very effective tool for awareness, offering brands a quick and affordable channel to distribute content around a brand launch or campaign.  But one of the other biggest opportunities for Twitter comes from the data that the platform can provide marketers.  As Mark Suster recently wrote, “Twitter is really the place where the public conversation is happening. It is the town hall.”  In this town hall, marketers can uncover significant market research, not only about their brands but also about their competitors and consumers overall.  The Market Research industry is a multi-billion dollar industry and companies like Nielsen and dunnhumby have become massive businesses by providing data and research to brand marketers.  This research and data serves as the first step in almost every marketing strategy as brands determine how to acquire new customers.  One could argue that Twitter is not a representative sample of the population and that is probably true.  However, the heaviest users of Twitter also tend to be influencers and early adopters.  As such, this vocal majority is a solid indicator from a data standpoint of what an influential core of customers might believe.  The data might not be completely scientifically validated but it should be enough to be a basis to guide brand decisions.

Twitter’s Role in Engage

Engagement is one of the areas that Twitter talks about most for their platform.  In fact, they even define engagement with a promoted tweet as being “clicks, retweets, favorites and replies.” There are two major areas where Twitter can drive engagement for brand marketers: customer service and engagement. In regard to customer service, the digitally connected generation turns online before they turn to a 1-800 number.  When a customer today has a bad experience with a brand or product, they often turn online to vent their frustrations.  In the past, an upset customer may vent by just yelling at the person on the customer service hot line and maybe tell two of their friends. Now a simple tweet or post can reach thousands, and maybe even millions.  In turn, brands can use Twitter to engage with their customers and solve customer service problems before they become big customer service problems. The second area of engagement is capitalizing on the trend of brands as publishers, which might be the biggest trend in marketing over the next decade.  Twitter is a great channel to leverage to have your consumers engage with your content.  This is at the heart of what Old Spice did with the “Responses” campaign last year.  It is also one channel that American Express uses for distributing their OPEN Forum content to drive engagement.  This type of positive engagement drives conversion and ultimately advocacy.  Twitter’s business challenge will be how to monetize their role in Brands as Publishers, but they are starting off in a very strong position.

Twitter’s Role in Convert

When it comes to convert, it is really about driving purchase.  Surprisingly, Twitter is emerging as an effective example of social commerce in this regard.  For years, Dell Outlet has famously used the platform to drive several million dollars’ worth of sales.  Meanwhile, fans of LivingSocial have extensively used Twitter to promote the “Share for a free deal” feature, frequently becoming a trending topic on Twitter when they do a national deal, like the Amazon gift certificate deal.  Deals have become a form of “social currency”, often leading people down the path to purchase when they discover a great offer that their friend promoted though social media.  One of the reasons that Twitter has emerged as an effective tool for convert is the “factor”.  When I hear about a deal on Living Social through Twitter, it is coming from a person that I follow and I follow them because I either know them or respect what they have to say, further indicating that this filter is a powerful tool in driving people to convert to purchase.  On the flip side, Twitter’s role as a massive driver of purchases will depend on it further attracting mainstream users, while also recognizing the uniqueness of commerce.  F-Commerce (Facebook commerce) has emerged as a real trend because of the massive share of mainstream users on the platform and high frequency of usage among those users.

What does it all mean?

In many ways, Twitter is at a tipping point when it comes to adaption by brands as a core marketing tool.  As outlined above, Twitter has the potential to be an effective tool for Acquire, Engage and Convert.  However, many brands today are still in experimentation mode with the platform, realizing they need to be there but not knowing best practices for leveraging it fully.  How Twitter engages, educates and ultimately monetizes these brands will make all the difference.

“Play on, Players” – Rockfish gives you reasons to “like” Bicycle Playing Cards

Bicycle_Facebook_Reasons

As we started up the Cincinnati office of Rockfish last Fall, we had a “wish list” of brands that we hoped to work with.   At the top of that list was 143 year-old, Cincinnati-based US Playing Card, maker of Bicycle, Aviator, and Bee.  When you think about classic brands, you can’t do much better than their portfolio.

On the other hand, playing cards are the classic type of business that are being disrupted by digital.  On the heels of the poker craze of the 2000′s, card playing is still extremely popular.  But today, people are as likely to play cards on Facebook as they are to play around a table.  This fact was not lost on US Playing Card, which was one reason they named Rockfish as their Digital Agency of Record earlier this year.

Last week, we had a chance to bring our first work to market as part of our partnership with Bicycle and US Playing Card.  Under the new tagline of “Play on, Players”, we helped Bicycle relaunch their social presence including:

  • Newly redesigned Facebook Page: Exclusive limited edition cards (including this awesome Big Gun Military Deck), rules to play your favorite games, and great giveaways.
  • YouTube channel: The source for the best playing card videos…from magic to card games to cardistry
  • Relaunched Twitter: Featuring exclusive products, special videos, tips and discussions.

There is going to be even more exciting work coming from Bicycle and US Playing Card in the coming months.  If you want to be the first to hear about it, be sure to like Bicycle on Facebook, follow them on Twitter and subscribe over at YouTube.  I promise that you won’t be disappointed.

Old Spice takes social engagement to a whole new level

Hands down one of my favorite TV commercials in recent memory has to be the Old Spice “Smell Like a Man, Man” campaign starring @IsaiahMustafa.  You probably know it better as the “I’m on a Horse” ad.  Not only did the campaign take home multiple awards at Cannes this year, but it truly crossed over to pop culture (my favorite is “I’m on a cake”).

Now the Old Spice team has dialed it up through a stellar social media campaign that takes engagement to a whole new level.  Lots of brands have used Twitter as a way to have a dialogue with consumers.  But in what I think is a first, Old Spice is actually doing a YouTube video response to people who mention the Old Spice campaign on Twitter.  Even better, the video responses actually have Isaiah Mustafa responding in character in the video.  So far celebs like @TheEllenShow, @ApoloOhno and @KevinRose have been lucky enough to receive responses.    My personal favorite has to be the response to @TheEllenShow [embedded video below]


Old Spice Responds to @TheEllenShow

Disclaimer – I work at P&G, which owns the Old Spice brand.  But it is still a really cool digital marketing campaign.

Twitter’s rapid growth continues, now over 1 billion tweets per month

Several months ago, people were asking if Twitter’s growth had stalled thanks to several months of flat traffic.  But it appears those reports of Twitters “demise” were premature.  According to a recently released report from Pingdom, Twitter passed the one billion tweet mark in December.  The growth continued in January, with 1.2 billion tweets sent.  That averages out to over 40 million tweets per day.  Looks like Twitter continues to be the little engine that could.

Weekly Wrap-Up: 8-10-09

Lots happening in the world of digital and I have been negligent in sharing the news / posts that really caught my eye lately.  So with that, here’s my latest weekly (better called monthly) update:

Breathing New Life Into Virtual Worlds – PR 2.0:  Virtual World membership grew by 39% in the second quarter of 2009 to an estimated 579 million with Youth driving most of that growth.

Four Questions for Successful CPG Social Media Marketing:  Great post from the Google CPG Blog, which is a must read if you don’t subscribe to it.

Why Teens Don’t Tweet:  Only 16 percent of Twitter users are under 25.  More specifically, 45-54 year olds are 36 percent more likely than average to visit Twitter, making them the highest indexing age group, followed by 25-34 year olds, who are 30 percent more likely.

Why We Need Marketing General Contractors – The Toad Stool:  Another great post by Alan Wolk.  I frequently use his term “NASCAR Blindness” and now I think I might be using “Marketing General Contractors” as well.

Best Buy’s CrowdSourced Job Posting is Live:  I’ve said it before, but this is one reason Barry Judge is a CMO that just plain gets where marketing is headed.

6 Lessons from the Best Marketing Campaign Ever – Rohit Bhargava:  At the Cannes Ad Festival this year, a single marketing campaign took home a Grand Prix award in three categories simultaneously–direct, cyber and PR– something that had never happened before in the 50+ year history of the show.  And the campaign was from a Tourism Board…not a Fortune 100 company or brand.

If Twitter had 100 People…:  5% of the people create 75% of the Tweets