Social Selling: The Internal Pitch

CMOGuess where I have been lately? I have been talking to some of our senior leadership about building a stronger social selling practice at AT&T. While this may seem natural enough to some of you, others who have tried to have these conversations realize how difficult it is to get the ear of the corner office. Seminars and entire workshops have been devoted to demystifying how to get traction in the corner offices around Social. Here are three things that I did that seemed to work.

1. Use the power of social to get their ear
Instead of sending an email to the CEO or beseeching their admin to give you a few minutes on the calendar, try a Social approach. I connected with my executives via LinkedIn and then reached out to them via that medium. A sure way to get an affirmative to your connection request is to pay attention to your profile. Make sure it screams success and professionalism.
Once I connected, I made sure I posted blogs and postings around my ideas that they might see. I then sent a direct message asking if they wanted to see some of the posts around successes I was having using Social to sell. In a college logic class I learned the word “Tautology”. It refers to something that is true in every case because it is just, well…true! By exciting my own executives using a Social plan, I was showing them exactly how I excited our customers about our products and services using the same approach.

2. Don’t say social
Once I had my foot cracked into the large oak doors, I was careful to speak about my successes in terms of what I did to succeed, not what Twitter, LinkedIn or YouTube did for me. I think we often make the mistake of trying to arouse interest around Social channels based on the size of their viewership instead of concentrating on what novel ways we can position our messages with real customers using those channels. Every executive has heard of Social Media. Every executive likely has an actionable plan around it even if that plan is moving at glacial speed and is not addressing the issues. One sure way to have your plan dismissed is by having it compete with an existing plan. I couched my ideas as a new way to reach customers that happened to take advantage of Social channels.

3. Prove your case and make a direct ask
My final point is some “Executive 101” that a mentor of mine helped me with before I went in front of my executive with the big ask. There must be some empirical evidence that makes you think your plan will succeed. Bring that out first. Tell the story and fill in the details on what happened and how the success happened. Use that success to make a big ask. Do you need budget? Resources? Support? The ear of another executive? Get to that request in the first 5 minutes and directly ask for it. This is what I did and the answer was a simple, ‘yes.’

Social media is a brave new world that is on the mind of corporate executives everywhere. By demonstrating the power of Social, couching your ideas for what they are and not as simply adoption of Social channels for their own sake, and getting to your point quickly, there is a high probability you will being hearing ‘yes’ too.

Acquiring Customers Using Branded Content

The great news is that we’re seeing many more hilarious and effective videos as marketers are looking to branded content to generate awareness (and possibly sales) for their new products and services.  While there is no guaranteed formula to reach your target audience, it’s often a combination of tone, timing and luck.  The most effective examples of acquiring customers using branded content are short and sweet videos that achieve the right balance of light tone, edgy humor and product information.

Here are two of Savvy Marketing’s favorites and one sort of, well, see for yourself.

Ship My Pants

This video from Kmart generated 13 million views since launching on You Tube.  Thanks and hat tip to the always informed ViralBlog.com for highlighting this 30 second spot as part of ViralFriday.

Dollar Shave Club Video

This classic 1:30 minute spot, created by CEO and Upright Citizen’s Brigade alum Mike Dubin, generated 10 million views and 12,000 orders within 48 hours.

Dove Real Beauty

Dove’s focus on real beauty is authentic and amazing, so I want to love everything that they produce.  However, in this video, women describe themselves to FBI-trained forensic artist, who then creates composite sketches.  It’s pretty long at around 3 minutes and feels forced and heavy, especially compared to some of Dove’s past campaigns.   That said, it’s certainly popular; this video has already gotten 27 million views in 10 days.

3 Perspectives on Paywalls

English: A speech in The New York Times newsro...

Writers creating content worthy of a paywall.

The good news is that paywalls are actually working well for publications with considerable scale like the Wall Street Journal, The Economist and The New York Times (NYT).  At the NYT, digital subscriptions will generate $91 million for the paper in 2012 according to Douglas Arthur, an analyst with Evercore Partners. The paywall, by his estimate, will account for 12 percent of total subscription sales, which will top $768.3 million in 2013. Even more encouraging is that digital subscriptions generated $52.8 million more than advertising.

The growth in digital subscriptions represents a new version of the NYT’s business model that evolved from the traditional 80-20 ratio between ads and circulation.  Further, the business model is still growing; subscription sales are increasing faster than ad dollars are declining. During the 12 months after the paywall was implemented, the Times and the International Herald Tribune increased circulation dollars 7.1 percent compared with the previous 12-month period, while advertising fell 3.7 percent. Subscription sales more than compensated for the ad losses, surpassing them by $19.2 million in the first year they started charging readers online.

The Guardian is taking a more nuanced approach, according to Andrew Miller, CEO of the Guardian Media Group:

In some news organisations where growth in readership may not be so important and in particular where there is a strong existing print subscriber base to build on, a pure paywall may make excellent business sense. The Economist and perhaps the Times spring to mind here. It also makes sense in other publications which feature business-critical information – for example, the Financial Times and, in the Australian context, the AFR.

At the Guardian we will continue to look at, monitor and offer a blend of options, including paywalls, depending on the product we are offering. But at the same time we have to recognise that digital advertising is not yet able to fill the substantial gap between any paywall revenues and the cost of the operation — not least because advertising agencies have not yet fully aligned their spend with changing patterns in media consumption.

But how to get from where we are today to where we need to be?  The main thrust of our strategy is to invest in our digital audience and revenue growth, while optimising the newspaper’s contribution in terms of both format and pricing and, crucially, managing our cost base to a level that is sustainable in the long term

My guess is that the Guardian’s audience will pay a premium for clips from The Premier League, which could put the whole publication in the black.

While this is great for large, global publications with scale, the question remains how to apply paywalls to smaller niche publications like The New Republic.    The New Republic’s marketing combines an eager softsell with some sticky features: the website has a strong call to actions, with reminders in bright red and the option to signup versus subscribe.

After signing up, you get a charming note from EIC and Publisher Chris Hughes:

Dear friend of The New Republic,

At The New Republic we believe that our democracy needs thriving and serious journalism about politics, culture, and ideas to function well. Tailored for curious, socially aware people like you, The New Republic embodies these journalistic ideals by going deeper than the headlines in a timely, unbiased fashion.

The way we all read and consume content changes every day. In an age of unprecedented technological change, we look to find new ways to help our readers engage with our content in print, on the web, and on mobile. We place less emphasis on generating clicks or superficial page views and more on making it as easy and pleasurable to read, engage, and interact with our content and ideas, wherever you may be.

To get the most out of your New Republic experience please:
Sign up for The New Republic Daily
Follow us on Twitter
Become a fan on Facebook

Thank you again for being a part of this.

Sincerely,

Chris Hughes
Publisher and Editor-in-Chief

P.S. Subscribers get access to 20 print issues, unlimited digital access, and tablet versions of our magazine for only $34.97/year. Become a subscriber today.

Today, The New Republic boasts less than 75,000 subscribers, down from it’s peak of 102,392 in 1993 according to the Alliance for Audited Media.  The magazine stopped auditing circulation in 2005.  Unsurprisingly, the magazine’s social media presence is very compelling and should drive a fair amount of referral traffic to the site.  However, it’s unclear what type of conversion rates they’re seeing and if digital subscriptions will increase substantially.

Step 1 in the ROI process: Calculating Acquistion Costs

The New Integration: The Traditional Funnel me...

The New Integration: The Traditional Funnel meets The Flipped Funnel (Photo credit: josephjaffe)

Dave McClure’s ‘Pirate” version of the customer life cycle: Acquisition, Activation, Retention, Referral, Revenue, is an excellent framework to use when calculating P&L contribution, payback period and ROI.  Mastering these metrics as part of the customer lifecycle enables marketers to create an optimized, easy to evolve strategy that evaluates ROIs across social media, search and direct response campaigns.

Let’s start with evaluating acquisition costs.

CPM

CPM stands for cost per 1000 impressions, which is the most common way to purchase display or banner ads.  For example, if you are purchasing ad space at a $10 CPM your ad will be shown 1000 times for $10.  To keep this simple, if your budget is $10,000 then mean your ad will be shown 1,000,000 times ($10,000 *(1000/$10)).

Total Impressions = (Total Cost or Budget) * (1000/CPM)

If you are trying to find out how much you will pay for a given number of impressions then you can use the following formula:

Total Cost = (Total Impressions * CPM)/1000)

You’re probably wondering how to translate impressions into people or how to estimate the number of clicks.  This is the right question!  However, it’s impossible to calculate this since CPM advertising is solely based on impressions.  Setting a frequency cap helps avoid the worst-case scenario of serving all the impression to one person only.

CPC

CPC stands for Cost Per Click.  In this type of advertising, you only pay for the number of clicks on your ads regardless of the number of impressions.  Google Adwords made this model popular and generally speaking, search and text advertising is sold by CPC model.

For example, if the CPC is $1.00 and your ad is shown 12,000 times but gets no clicks then you pay nothing. If you get 10 clicks on your ad then you pay $1.00X10 = $10.00.

CPC = Total Cost/Total Clicks

Total Cost = CPC * Total Clicks

Comparing CPM to CPC and vice versa

Choosing one model versus the other is really dependent on where you are in the customer life cycle.  If you are focused on driving brand awareness as a new brand or company, it makes sense to generate as many impressions as possible.  Facebook Ads is great for this: highly targeted and segmented customer base with A/B testing capabilities built in.

If you have great brand awareness already or are farther along in your customer lifecycle, CPC may make more sense.  The best approach is to compare two models to figure out where and how to spend your money effectively.  To do this, you need to convert CPM to CPC or CPC to CPM pricing.

CPM to CPC conversion

Here is a formula for doing this: CPC = ((Total Impression *CPM)/(1000 *Clicks).  Let’s take an example of a campaign that costs you $10 CPM and generates 50 clicks in 50,000 impressions.

    Formula
CPM $10 Known variable
Impressions 50,000 Known variable
Click 100 Expected or Known
Total Cost $500 Impressions * (CPM/1000)
Cost Per Click $5 Total Cost/Clicks

The above $10 CPM campaign is equivalent to a $5 CPC campaign.   The difference is that the CPC approach brings the customer to your website versus just letting them know you have one.  This means that the customer has 1) seen an ad meaning you’ve already earned revenue or 2) is one step closer to purchasing a digital subscription.  The challenge is that (click through rates) CTRs are steadily declining.

CPC to CPM conversion

Here is a formula that you can use to calculate a CPM equivalent of a CPC model:

CPM = (CPC*clicks*1000)/Total Impressions

Let’s take an example of a campaign that costs $4 per click and generates 100 clicks, resulting in a total spend of $400. Let’s say it took 50,000 impressions to generate those 100 clicks.

    Formula
CPC $4 Known variable
Clicks 100 Known variable
Total Cost $400 CPC*Clicks
Impressions 50,000 Impressions * CPM/1000
Cost per 1000 Impressions 8 Total Cost/(Total Impressions/1000)
CPM $8 Cost per 1000 Impressions

eCPM

The CPM value you get when you convert CPC into CPM is also known as eCPM (effective CPM). eCPM is also shown in Adsense reports, in that case. Total Adsense Revenue /(Impressions/1000)

Which media companies have excellent communities?

My communities

Communities (Photo credit: steven w)

The key factors to consider include title and brand, type of editorial content, audience and what role you want the community to play for your readers.  Typically, media groups use communities to encourage engagement as measured by time on site and page views.  Communities could also be used to acquire new readers if you add social sharing buttons.  Additionally, communities can be great for advertisers open to different types of sponsorship.

Here are two examples that will help to illustrate how two very different titles approached the idea of community.

The Economist has created an online community based on debates between users on a given topic.  One of their brand values is encouraging “intelligent debates” as a way of advancing ideas, expanding knowledge and combating ignorance.  The format is to have readers discuss a given topic with metrics about which was the audience is going and a guest speaker.  These debates are often sponsored, so a great source of revenue.

Economist Debates: Business and change

Runner’s World has a created several forums that focus on specific issues such as training, gear, tips for beginners.  Their brand is very straightforward, all about running at various levels.   The format is more basic and looks like something from 1995.  That said, the reader participation is not trivial, the beginners’ forum has more than 9m views.  Pretty impressive for a very targeted type of content.

Runner’s World Forum – Home

Will CPMs improve as native ads replace banner ads?

There seems to be a lot of talk about replacing underperforming banner ads (sample click throughs of .01%) with Native Ads.  The idea is to embed sponsored content within editorial, which sounds like a great idea.  Buzzfeed is leading the charge here and has convinced The Awl to try this as well.

The legacy publishing houses (Hearst, Conde, Time) are doing their best to transform the space themselves, with only a little bit of success as evidenced by eroding revenues due to lower CPMs moving from print to website to mobile and little if any profit from the aggregators (Pulse, Flipboard)

Here are a few examples of older titles partnering with start-ups:

  • Real Simple and Lover.ly have a content and ad sharing deal in the wedding space
  • Esquire and Byliner have an editorial/publishing relationship based surfacing new indie authors
  • Vogue and Moda Operandi on an ecommerce deal that enables users to pre-order fashionable clothes on Vogue Fashion, Features, and More on Vogue.com

There are a number of start-ups focused on optimizing CPMs for unsold inventory (AudienceFuel). Additionally, there are start-ups focused on increasing traffic and user engagement as measured by page views, time on site (Demand Media, Evolve Media, Taboola, SmartLink, WetPaint).

Finally, Chartbeat and Bitly are offering more robust tracking and reporting tools that enable editors, publishers, marketers and advertisers to understand user behavior more completely,

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