Why you shouldn’t send your traffic to Facebook?

Seasoned Digital Strategists (folks who have been in the online space for a long time, not just social) realize the value of having traffic come to the site as opposed to sending it out there. In a business envoirnment, we spend millions in creating and developing custom web experiences that resonate with our audience — and then we send them off to our facebook page. Why?

Why not drive them over to your site. In my past life, as their Global Marketing Leader at IBM’s DeveloperWorks, we realized the value of social media and created experiences that bridged external and on-domain experience. We learned that on our own domain can be as capitivating and social as any external social network. But it needed us to shift our marketing mindset to embrase social holistically. From advocacy programs to how we communicated our message. Frankly, brand needed to become less about the brand and more about the community it served. It wasn’t easy. But we did win the Forrester award for being the best in Social B2B space in supporting our community — on our own domain.

This allows us to serve community no matter if Twitter, Google+ or Facebook go away or morph into another network.

Copyblogger’s Sonia Simone has called it out.

Digital sharecropping is a term coined by Nicholas Carr to describe a peculiar phenomenon of Web 2.0.

One of the fundamental economic characteristics of Web 2.0 is the distribution of production into the hands of the many and the concentration of the economic rewards into the hands of the few.

In other words, anyone can create content on sites like Facebook, but that content effectively belongs to Facebook. The more content we create for free, the more valuable Facebook becomes. We do the work, they reap the profit. Same story with Twitter, Xing and other networks.

The term sharecropping refers to the farming practices common after the U.S. Civil War, but it’s essentially the same thing as feudalism. A big landholder allows individual farmers to work their land, and takes most of the profits generated from the crops.

The landlord has all the control. If he decides to get rid of you, you lose your livelihood. If he decides to raise his fees, you go a little hungrier. You do all the work and the landlord gets most of the profit, leaving you a pittance to eke out a living on.

Let’s think about that for a second.

How not to lose billions? Social Media ROI – Walmart Case Study

Mark Hurst, one of my favourite authors on customer experience, recently talked about a Walmart case study. In this case, the intentions were in the right place but execution and lack of interaction caused (and still causing) Walmart to have losses exceeding $2 Billion (yes, $2 Billion).

The issue wasn’t that they didn’t care about the customer. In fact, they thought they listened to the customer but the approach was very traditional and one way and presumptuous.

So you’re thinking of launching an uncluttering project. Strategic. Huge. Millions of dollars. But before you make any changes, you want to float the idea by customers.

So you conduct a survey, asking customers: would you like Walmart aisles to be less cluttered? And they say, “Yes, now that you ask, yes, that would be nice.” And you check the box by “customer input” and report back, hey everyone, good news, yes, customers like the idea.

Walmart spends hundreds of millions of dollars uncluttering their stores, removing 15% of inventory, shortening shelves, clearing aisles. Yes, it’s expensive and time-consuming, but this is what customers said they wanted, so you barrel through it. But.

Sales went down. From the beginning of that project until today, Walmart has lost over a billion dollars in sales. (Yes, billion with a “b”.) It’s actually closer to two billion dollars of sales they missed out on, and maybe more.

What was their mistake?

The mistake was a lack of customer focus.

“They ran a survey! Customers loved the idea!” But that’s exactly the problem. Walmart didn’t pursue the question of what customers wanted. Instead, Walmart came up with the answer first, then asked customers to agree to it. That’s exactly the wrong thing to do, because it ignores customers while attempting to fool stakeholders into thinking that the strategy is customer-centered.

Put another way, Walmart based this incredibly expensive misadventure on what customers said, rather than what they did. And the customer experience is all about what customers do. In real life. No hypotheticals. Walmart acted without considering the customer experience, and that was a big mistake.

As Mark points out, The lesson: ignoring the customer experience is an expensive mistake. Be sure to listen to customers the right way, so that you get a strategy that actually works. Social Media can play a critical role here. The ROI loss is significant and social intelligence tools/services can help you understand the customer experience.

Social Listening

Social media listening is the first and one of the most important parts of an overall social media framework. You listen and engage, you understand and then you react. Once, you are established in the space, you can take the proactive pragmatic approach and impress your followers, advocates and customers.

Had Walmart observed their space in regards to how they view the stores first, they could’ve avoided this disaster.

They should have engaged with the real people (communities)  first. Secondly, focused on understanding their perspective and how they experienced the store, and thirdly, crafted a program and plan of action to accommodate the customer experience.

And this is why you need to listen and engage properly in our economy 2.0.

Example: Cisco's Social Media Listening