With the recent realization of the idea of pre-commerce as an ultimate expansion of the e-commerce concept, as well as with the widespread recognition of the consumerisation of the IT we actually came to a widely different concept of product management based on social media. Prerequisite reading about that: Pre-Commerce and the Consumerization of IT [Sept 10, 201].
Some essential excerpts from that:
Your brand is not something you control. It’s controlled by your customers. And your customers are now today in blogs, in forums, in websites … 20 to 50% of the purchasing decisions are being made today by the word of mouth on the Internet and social websites.
“We spend less than one percent of our time online involved in a transaction,” said [Bob] Pearson [the author of Pre-Commerce book]. “On the other hand, 99 percent of our time online is spent learning, browsing, socializing and seeking support. Companies that develop excellence in pre-commerce will be the ones to drive e-commerce success in the years ahead.”
In today’s environment, the customer drives the success of a brand.
“Social media represents a disruptive set of technologies and techniques that will transform a company’s business practices, improve conversational capabilities with customers and empower employees to learn and share their knowledge in real time,” said Pearson. “In the years ahead, we will see social media evolve into a discipline that companies use throughout their organization — from marketing to technical support to human resources.”
You don’t have to be a parent to understand that there’s a difference between just hearing and actually listening. … Listening is what we do at Dell and social media has made it that much more effective and efficient. … We have taken listening to a whole new level and we use it in every aspect of the business—from product and solutions development to services to sales to customer support to marketing. … We have what we call our Listening Command Center which monitors conversations taking place about Dell on Twitter, Facebook, across all social media communities. The folks on this team can immediately triage a situation. They’re able to trend data that shows us what issues people are latching onto, positive or negative, and then our teams deal with them accordingly. … In recent years, Dell has been recognized as a social media innovator, using online networks to connect even more deeply with customers.
Social media based product management has already become essential for global products, especially for the products of large scale, global vendors with mass consumer or household appeal. Currently Dell is in the forefront of this new way of product management. To understand their advancement read the following articles (besides the previously indicated prerequisite reading):
– Is Dell the World’s Most Social Company? (Scorecard) by Mark Fidelman [Seek Omega, June 2, 2011] summarizing in 5 reasons why Dell is the world’s most social company by now and also presenting that in an easy to comprehend scorecard:
– Dell Hell by Jeff Jarvis [June 28 – July 11, 2005 ]: the harsh criticism which initiated Dell’s remaking (after the flood of social media conversations generated by it)
– Open letter to Michael Dell by Jeff Jarvis [Aug 17, 2005] as a follow-up to the initial criticism
– Dell Hell: The end? by Jeff Jarvis [Oct 8, 2007] as reporting about the first signs of recognition by the company of the importance of what is called by Jarvis “conversation” (see also: The conversation goes on, with or without us [May 25, 2011])
– Dell Learns to Listen by Jeff Jarvis [Businessweek article, Oct 17, 2007]
– Dell Quells Critics With Web 2.0 Tack by Matthew Creamer [AdvertisingAge article, June 11, 2007]
– What is Listenomics? by Tom Greenwell [May 30, 2011] tying the Dell Hell flood of social media conversations (resulting BTW in 45% fall of Dell’s stock price because of a huge, campaign-like phenomenon) to the idea of “listenomics” (2005) by Bob Garfield who had been arguing that the primary objective of firms’ communication strategies should not be about disseminating messages but receiving them
– Dell: From Hell to IdeaStorm by Tom Greenwell [June 13, 2011] which is a gradually developing, annotated bibliography of material, academic and general, on Dell’s exciting user innovation community: IdeaStorm
– After the IdeaStorming, which ideas are adopted? by Tom Greenwell [June 25, 2011] which summarises Paul M. Di Gangi and Molly Wasko’s 2009 article, ‘Steal my idea! Organizational adoption of user innovations from a user innovation community: A case study of Dell IdeaStorm’ [Decision Support Systems, Volume 48 Issue 1, December, 2009, pp. 303-312]
– How Dell’s Social Suggestion Box Empowered Fans & Improved the Company by Todd Wasserman [Mashable, Aug 25, 2011] trying to answer the questions: “But is IdeaStorm more about mollifying social media critics than soliciting ideas? Is it more a PR exercise than anything else?”. The answer comes in fact in the title of the article which is ending with: “Since the concept of soliciting ideas online is now somewhat passe, Dell is evolving it. Last fall, the company made an effort to bring IdeaStorm into its phase two: complete social media integration.”
– How Dell turned around negative word of mouth by Andy Sernovitz [March 12, 2009] indicating other actions besides the IdeaStorm
– How Dell’s social media program is evolving by Andy Sernovitz [April 20, 2010] reporting on further plan/progress as presented by Dell’s chief blogger, Lionel Menchaca (a video record of the 29 minutes long presentation is included as well)
– How Dell finds ROI from social media by Andy Sernovitz [April 6, 2011] reporting on how Dell’s current social media practices help the company’s business results as presented by Adam Brown, Executive Director of Social Media for Dell (a video record of the 30 minutes long presentation is included as well)
Now look at the below timeline of the steps taken by Dell till its current industry benchmark status:
From: Customer Centered Marketing: The Social Media Journey [by Allison Dew, Aug 25, 2011]
Allison Dew is Dell’s Executive Director for Social Media and Community. She is responsible for establishing Dell’s strategies, global programs, best practices, policies and measurement of social media across the company. In addition to leading Dell’s social media and community efforts, Allison is also responsible for Global Insights based on customer research and analytics. She combines this primary research and marketing analytics function with Dell’s social media listening and engagement initiatives to further maximize how Dell uses customer insights and feedback to deliver business value.
The natural and the most simplistic question arises here: Have Dell’s products improved? Have they improved their customer support significantly as well?
My view as a 12 year Dell employee, now an alumnus, is that the products and customer service did improve from a low point in 2005-2006. The other improvement is that Dell got a very public reminder that the brand promise was broken and needed to be fixed. Social media served as a mirror for Dell to view the publics’ attitude toward the brand (much quicker than focus groups, brand studies, other traditional research methods). Dell’s business model was direct engagement with the customer, but got soiled along the way. The social engagement journey chronicles Dell’s recovery on key principles of the brand, and then how Dell participated in social media to engage with larger audiences for multiple business objectives (product feedback, customer service, product launches, etc.)
as a comment to: Dell’s Social Engagement Journey by Jackie Huba [Church of the Customer Blog, Dec 16, 2010]
The Social Engagement Journey, put together by our team at Ant’s Eye View, is a 5-stage process that a medium-to-large brand or company goes through while integrating social media into their business. Dell was one one of the earliest companies to go through this process.
They are often held up as a social engagement model, but their journey hasn’t been all roses and buttercups. In this post, we outline their journey in the last five years.
In 2005, Dell was in Stage 1, the period in which most companies’ engagement with customers is through traditional marketing and customer support channels. Functions and business units are silo’d. They are ambivalent to online conversations. Involvement in social channels is not on the executive radar.
For Dell, 2005 was the year of Dell Hell, Jeff Jarvis’ online campaign against the company for their less-than-stellar response to his non-functioning new laptop. “Dell Hell” became an online meme around the web, as customers started taking their complaints to the web en masse. The complaints were rooted in some major problems in the company related to poor quality products as well as frustrating customer support. Dell was largely unaware and unresponsive to the online complaints. There was no monitoring of online conversations and no team in place to handle them. Dell’s online focus was ecommerce and esupport via Dell.com.
In 2006, Dell had moved to Stage 2, where silo’d teams start to dabble in social media. There is some online conversation monitoring but no standardization of tools. Executives become aware of what is going on in social media, but are not committing resources or budget to social engagement activities. Maverick teams are forced to bootstrap people resources and money to get anything done.
After the Dell Hell meme gains momentum and is the subject of some mainstream media stories, Dell begins to engage in a few social initiatives:
- Executive support: CEO Michael Dell asks a small team to help bloggers with technical issues.
- Customer support: A community outreach team is formed. The team begins by listening and monitoring conversations to see what is being said. The tech support experts are hand-selected for their tech problem-solving expertise and superior interpersonal skills.
- Marketing channels: Dell launches Direct2Dell a corporate blog, with chief blogger, Lionel Menchaca.
- Conversation monitoring: The customer service and PR teams outsource this to an agency to find customer issues that were being voiced online. Dell used the agency to find conversations, but company employees, not the agency, did the outreach/engagement with customers needing help on the social web.
- Employee competency: Only a handful of employees are skilled in social engagement
In 2007, Dell moved into Stage 3, in which most companies formally organize for social engagement by creating an empowered team run by a S.P.I.C.Y. leader. Social channels may have proliferated so there is move to edit down to the most impactful ones. There is a focused effort on training and education of more employees on social engagement. Tools are consolidated. A baseline framework for measuring social engagement is proposed.
Dell had put more emphasis on social engagement, building on the positive results from 2006 initiatives:
- Business operations: A centralized team run by Bob Pearson and Sean McDonald (now with us at Ant’s Eye View) is formed.
- Risk mitigation: First set of social media policies and governance are put into place
- Tools: The team standardizes on Visible Technologiesfor online conversation monitoring. Dell operates blogs and forums for dedicated customer engagement topics.
- Marketing channels: Dell joins Twitter with a number of ids.
- Feedback and innovation: Ideastorm for customers to brainstorm new ideas and features for products is launched.
- Resources management: Dell did not have dedicated shared services, so the centralized social team borrowed resources from multiple teams (IT, online) to move quickly to test and launch social engagement tools and websites.
- Strategy and planning: Formalized strategy is developed and refined for executive buy-in
In 2008, Dell advanced to Stage 4, the period in which a central team still exists but more work is being pushed to business units. Channels start to yield real results. Employees are competent and are actively engaging socially with customers. More rigor is being put into measurement which becomes part of business units’ business plans.
During this time, Dell has become a Stage 4 company in nearly every aspect:
- Marketing channels: By May 2008, Dell outlet on Twitter achieves $500,000 in sales. A blog for the channel community is launched and gains awareness. Social content now appears on Dell.com(homepage navigation, product pages with ratings & reviews)
- Advocate engagement: Online communities are launched for Dell’s environmental efforts (called Regeneration) and technophiles (called Digital Nomads)
- Employee competency: Community managers are named for each of these markets: channel, small business, consumer, and enterprise. Roles are formalized for listening and resolution, content planning, technology testing and planning, and measurement.
- Customer support: Proactive outreach on Twitter and blogs
- Measurement: Formalized dashboard with set goals and monthly reporting
- Conversation monitoring: Online listening is brought in-house to the central team, standardizing on the Radian6 toolset.
Dell has actually regressed to Stage 2 or 3. Events have interrupted the company’s progress through the Journey. Alternately, events can also accelerate a company’s journey, too.
In 2009, the recession was in full swing and pressure was on the social media team to scale operations by reducing headcount. A change in marketing leadership slowed down social engagement initiatives:
- Strategy and planning: With departure of the incumbent CMO, the social engagement strategy was started anew and lost some corporate knowledge and momentum.
- Employee competency: The two key executives running the social engagement team left Dell, as well as a number of community managers. The new people brought in to replace these folks did not have the same level of competency. With loss of some key people and volume of people, social engagement knowledge resembled stage 2-3.
- Feedback and innovation: Ground was lost on Ideastorm due to the departure of the employee who was running it. Without dedicated resource, Dell was slow in responding to customer ideas and comments on the site.
On the upside in 2009:
- Marketing channels: There was too much proliferation in creating social engagement properties so blogs were consolidated. Revenues from Twitter approach $6.5 million.
- Business operations: With the departure of key market community managers, business units began to take on this work.
For Dell, 2010 was year of regrouping and establishing a foothold back in stage 4. New initiatives were put in place to move the company back into stage 3 and Stage 4 in some areas.
- Executive support: Manish Mehta was named the new leader of the social engagement team and fills gap from departed team members. Manish retained the great talent of Richard Binhammer and Lionel Menchaca, both early pioneers with Dell’s social media operation.
- Strategy and planning: An updated, comprehensive social strategy is put into place
- Conversation monitoring: A new role, Chief Listening Officer, is created who will work to get insights gleaned from online conversation monitoring integrated back into key company processes. A Social Media Listening Command Center is opened.
- Advocate engagement: The CAP, or Customer Advisory Panel, is started. Its goal is to bring key customers to Dell HQ to former tighter bonds with key advocates and understand their delights and frustrations.
- Business operations: Business units still playing a key role in social engagement efforts
Dell’s travels through the Journey are a solid example for how social media is transforming companies to be more customer-centric. Dell’s experience shows it’s not always a smooth pathway. Internal and external factors can cause a company to jump ahead a few stages, or in Dell’s case, move back a few stages, but it seems to have the momentum now to reclaim its place in the social engagement pantheon.
On this journey Dell wasn’t alone but enlisted the support of leading experts in the field of applying social media for the purposes of large scale global businesses:
Andy Sernovitz on WOMMA and the Blog Council by Lionel Menchaca [Direct2Dell, Jan 28, 2009]
I first met Andy Sernovitz in person when I interviewed him back in November of 2006 at the time we were unveiling our Blog Policy that we developed with the Word of Mouth Marketing Association(WOMMA to a lot of folks).
For those of you who aren’t familiar with Andy, he was a founder CEO of WOMMA, the author of Word of Mouth Marketing [book], a blogger and teacher. These days, besides being the CEO at GasPedal, he runs the Blog Council, which is a sometimes unpopularprivate organization of large companies that utilize social media tools to connect with customers.
Update: I should have clarified after my previous sentence that Dell was a founding member of the Blog Council. Back when it launched I thought it was a good idea, and still do.
In this 15-minute, audio-only interview, Jacqui Zhou who runs Direct2Dell Chinese discusses a range of topics with Andy. In it, he shares some insight into WOMMA and the Blog Council as organizations, discusses some trends in social media marketing, and offers some tips on creating and running organizations that focus on common objectives.In this audio-only interview, Andy Sernovitz author, blogger, teacher and CEO talks to Jacqui Zhou, who runs Dell’s Direct2Dell Chinese blog about WOMMA, the Blog Council and more.
So that external expertise started with the idea of “word of mouth marketing” first formulated by Andy Sernovitz and presented in an up to date form in a recent video below as:
[March 15, 2010] ARDA 2010 Convention keynote speaker and author of Word of Mouth Marketing, Andy Sernovitz, will talk about the power of word of mouth marketing, including harnessing both the positives and negatives of communicating with owners and travelers.
Sernovitz’s Gas Pedal LLC:
… provides marketing consulting services. The company offers word of mouth, blogging, and viral marketing strategizing services. Its clientele include AIG, Sprint, Kimberly-Clark, Dell, Ralph Lauren, and TiVo. GasPedal LLC is based in Chicago, Illinois.
while his Social Media Business Council has been made out of the initial Blog Council with the help of another luminary, Bob Pearson, the author of Pre-Commerce, (see also more about him in Pre-Commerce and the Consumerization of IT [Sept 10, 2011]) who has been even more influential with Dell being their Vice President of Communities and Conversations. See: Dell’s Social Media Maven Heads To GasPedal’s Blog Council by Mark Walsh [Online Media Daily, April 7, 2009]:
Bob Pearson, who helped reverse Dell’s poor reputation for customer service by embracing social media, has left the computer giant to become president of the Blog Council, an offshoot of word-of-mouth-marketing company GasPedal.
The 46-member Councilis composed of the heads of social media for Fortune 1000 companies including Cisco, GE, Dell, Microsoft, Wells Fargo, The Home Depot and Procter & Gamble. The group focuses on establishing best practices for blogging and social media within large corporations.
As vice president, communities and conversations at Dell, Pearson ramped up the company’s social media efforts to combat the “Dell Hell” label applied by critics to its customer service operation. The company now boasts a 42-person social media team at Dell that runs blogs, a video channel and other forums as well as tracking what people are saying about the company.
“He’s the first guy to build a big social media program at a big company,” said Andy Sernovitz, CEO of GasPedal and the Blog Council. “This is an opportunity for Bob to help a lot of other companies figure out how to do the same thing.”
Sernovitz said he expects the Blog Council, a for-profit operation started in 2007, to expand to “100 or 200” members by the end of 2009. A company membership costs $10,000 a year. Members have access to email discussion lists, participate in weekly phone conferences and meet four times a year.
“Bob will be growing that whole program,” said Sernovitz. Despite the economic downturn, he doesn’t expect corporations to cut back on social media efforts to focus on traditional marketing efforts. “Social media is not a marketing tactic anymore — it is something that fundamentally transforms the entire enterprise,” he said.
He noted that corporations are facing many of the same issues related to social media, such as developing policies and practices for individual departments and on employee disclosure and training. Sernovitz estimates that about 1 in 10 corporations have someone formally in charge of social media.
The official announcement:
– Bob Pearson, former head of social media at Dell, is the new head of the Blog Council [April 9, 2009]
as well as
– the reports of Pearson’s half year stint with the Council [May 13 – Sept 30, 2009]
during which he was instrumental in the transformation of the Council
– Blogcouncil is dead, long live Social Media Business Council! [Visionary Marketing, July 2, 2009]
The Council became even stronger after moving into the emerging center of social media expertise:
– Social media expert sees Austin as emerging hub by Kirk Ladendorf [Austin American-Statesman, April 6, 2010]
Council of 115 companies that meets to discuss ways to use social media will relocate to Austin.
Austin is becoming a hub for social media.
That’s the assessment of Andy Sernovitz, who runs the Social Media Business Council, a group of 115 companies, each with $1 billion or more in annual revenue, that meets regularly to talk about best practices in using and governing social media in members’ operations.
Sernovitz, who runs a marketing firm in Chicago called GasPedal, is moving himself, his family and the Social Media Business Council to Austin by August, which is when the new school year starts. GasPedal, his marketing company, will remain in the Windy City.
Austin, Sernovitz says, has the lifestyle, the talent base and the entrepreneurial spirit to become one of the focal points for social media.
“This town feels like the Bay Area in the early 1990s,” he said Monday on a trip to Austin to check out houses and schools for his children.
The recent decision of Facebook Inc. to set up an operations center in Austinjust confirms Sernovitz’s assessment.
His group grew out of Dell Inc.’s early involvement in social media in 2007 as the computer maker sought to deal with bloggers, who were criticizing Dell’s products and services. Dell learned to engage with disgruntled customers and critics online and to try to resolve issues before they became larger problems. Gradually, those efforts bolstered the company’s reputation among readers of technology blogs and Web sites.
“Dell was the first major company to get social media right,” Sernovitz said. “They were the first company to be attacked by bloggers, and they figured it out because they were forced to.”
When companies started asking Dell for tips about social media, the need for a business council became apparent. His company, which did consulting for Dell, took over the project of creating the Social Media Business Council, which now includes such companies as McDonald’s Corp., Procter & Gamble Co., Microsoft Corp. and Pfizer Inc.
Key players from member companies share information on how they deal with social media opportunities and issues on a regular basis. Every few months, they gather somewhere in the country for a face-to-face discussion of ideas and suggestions.
When Toyota was dealing with its automobile safety issues, it was laying out its plans for using social media to tell its side of the story, Sernovitz said.
Because social media, including Facebook, MySpace, Twitter and other platforms, are still evolving, big companies are still figuring out how to use themfor marketing, while setting rules about just what is allowed online and what isn’t for company employees.
Because the landscape of social media keeps changing, companies keep finding value in sharing their ideas and challenges, Sernovitz said.
As more businesses join the group, Sernovitz says the council probably will break into separate discussion groups involving 80 to 100 companies each.
This council has flourished despite harsh criticism (or skepticism at the best) from the very beginning:
– Big Companies Form Private Blog Council [Dec 5, 2007]
– Big Business “Blog Council” created, business world yawns [Dec 6, 2007]
– Will new Blog Council help big companies get small conversations? by famous Robert Scoble [Dec 6, 2007]
– “Strong Criticism for the Blog Council” part of the Blog Last [Dec 17, 2008] stating in the end that “I want to see much more public value from the Blog Council before it merits anything but a thumbs down from me”
The reason is quite simple, the Social Media Business Council is really providing important value as evidenced by the following excerpts from a year-old Andy Sernovitz interview:
– How Big Brands Employ Social Media Marketing by Michael Stelzner [SocialMedia Examiner, Aug 26, 2010]
Of the two brands that are part of my company, one is the GasPedal side, but we teach word-of-mouth marketing. It’s the word-of-mouth marketing company.
I think what happened is about 3 years ago, we realized that social media is something that anyone can get up and do. If you’re a small business or an individual, it has that simplicity.
But when you’re a big company, it gets so much harder. It requires significant philosophical, behavioral and operational changes. It’s just not the same inside a major enterprise.
We started this group to be the home base and the peer group for people at big companies who are using social media and want to learn how to adopt it and learn from each other and share. That’s where this started.
Our name used to be the “Blog Council” because blogs were the only thing. Social media hadn’t really become part of the mix yet.
We were at Dell headquarters and Dell was doing what they then called a “buzz marketing” conference. Dell had been inviting other companies over to learn how they ran their blogging, social media and conversations department.
I was at lunch with some folks from Dell, Proctor & Gamble, Microsoft and Intuit. We had been sharing our unique challenges with this stuff. We had been talking to each other informally, ending up with “Why don’t we start a group that lets us formalize the sharing, scale it up, and bring a whole lot of companies together?”That was the formation.
I think every company is using it [now]. What’s most interesting is that the marketing side is such a small part of where social media adds value. It’s really becoming transformative across the entire enterprise. HR is using it, customer service is using it, research is using it and internal communications is using it.
I would say with 50% of the companies, it starts in PR, which actually makes a lot of sense when you think about PR being much more structured for conversation. You build relationships with reporters, you tell stories and you build long-term dialogues. It’s about words, whereas marketing is about numbers and campaigns.
People think it’s an advertising technique and that it’s about campaigns. If your ad guys take over your social media voice, you’re in trouble. It’s not a customer acquisition tool like, “What’s our ROI?” It’s a conversation tool.
If you start jamming what are really TV ads onto YouTube and calling it social media, it’s not going to work. Equally important, you’re going to miss the point.
Search has made us completely addicted to the numbers. We know to the 800th decimal point our search engine lead generation costs every second of every day. But we don’t know if someone posted an Amazon review about our product that is going to sit right next to the Buybutton forever.
Thinking about social media as advertising is really where the danger is.
[About the social media outsourcing] … setting it up and doing the creative, some of the heavy lifting on the execution, the analytics and all of that kind of stuff [is OK].
But what we’re talking about is fundamentally your customer voice, your brand voice, and your personality. The whole point of this is to connect with people and talk to people. How do you outsource being friends with someone?
And if you think you went bad with all of the tech support that went overseas where everyone just tried to save a buck and it was a disaster for any brand who did it, imagine when your brand is being represented by somebody who’s only in it as long as their agency has the account.
I am the single biggest advocate and maniac when it comes to absolute transparency all of the time. You’ll see me running all around the country pounding the podiums screaming about ethics because this is what it all comes down to. You can’t build a trust-based relationship that starts with lying to somebody about who you are.
Everyone thinks this transparency thing is hard. It’s really easy. “Hi, I’m on Brand Company’s team over at the such-and-such agency. How can I help?”
It’s a phrase that goes from total lack of disclosure to complete transparency.
[Regarding the future] … We’ll stop thinking of it as “media.”That’s a bad word. It implies it’s something you buy to get your message out.
[His single piece of advice for those businesses that are just now getting started with social media] … It’s the same advice for everybody, which is to just do the little stuff. Pick one thing you can do—whether it’s a Facebook page or a Twitter account or one particular product—and keep it really simple. Don’t spend any money. You’ll find it’s surprisingly easy and you’ll have some nice overall results. All of the politics and the fears and the objections that are getting in the way, they all go away because you can prove that it worked.