Financial Chronicle Story on Social Media and Consumer Behavior
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I was recently quoted in a Financial Chronicle story on how social media is changing consumer behavior and influencing purchase decisions.
Most Indian marketers use digital media for building awareness (via Webchutney). However, the real value of social media is in the consideration stage, in terms of establishing relevance. Consumers are more likely to consider a product or service that is recommended by their friends, or even by other people like them. Indian marketers are beginning to understand the potential of “social shopping” and we should see some very interesting experiments in this space very soon.
Here’s the full text of the story –
I Network, I Buy
Marketers are moving on to social networks to sell their brands
July 7, 2009
Reji JohnKarthik Nayak is a search-engine optimisation professional — one whose job is to make a company’s name to come on top during searches on Google or elsewhere. He has an online profile on almost every social networking site you can think of. An active blogger, Nayak spends a couple of hours each day to connect with his online friends in specific communities. His Blackberry comes in handy to tweet on the go. Therefore, every time he decides to purchase something valuable or even think of going for a movie, Nayak makes it point to interact with his online community members.
Nayak is one of the millions of members in the rapidly growing online social media networks with enormous power to influence others in their consumption and social behaviours. Friendship is no more what it used to be. The latest tools available on online networking sites give members a wide array of opportunity to create, extend and find friendships based on individual interests. As a result, while online members wield a power to make, what is called user-generated content, there is a tremendous opportunity for marketers, advertisers and brands to take advantage of the ever-growing social networking population online and target their products and services to custom-made groups.
Surveys on networking habits find that it is becoming much “more than just a fad” among the youth. The quarterly consumer internet barometer, which surveys 10,000 households across the US, says social networking is exploding in popularity, with 43 per cent of the online community using such sites, up from 27 per cent a year ago
“What we already know is that a customer is most likely to badmouth a product or a service if he or she is not satisfied with. With social media, there is more freedom for an individual to ensure that the word-of-mouth (good or bad) reaches a larger number of people,” says Anandakuttan B Unnithan, professor of marketing at IIM–Kozhikode. Unnithan, who is now doing research on how social networks influence consumer behaviour, finds there is a distinct shift. “They are not looking at friends or neighbours or people who are experts in the domain, but at the consolidated information available among user generated content in blogs, Facebook, Orkut, Youtube and Twitter.”Gaurav Mishra, co-founder of social media research and analytics company 20:20 WebTech, summarises social media as 4Cs: content, collaboration, community and collective intelligence. “Taken together, these four themes constitute the value system of social media. I believe that the tools are transient, the buzzwords will change, but the value system embedded in these 4Cs is here to stay,” says Mishra who had earlier taught social media at Georgetown University in the US.
Says Beerud Sheth, co-founder and chief executive officer of SMSGupshup: “Call it the participative or collaborative web. Consumers are not just consumers anymore; they are also producers and therefore influence the debate, kick-starting the conversation, and define it. The impact on consumer behaviour is thus huge. I believe it to be one of the biggest trends in recent times.”
Marketers are quickly getting on to the social-networking bandwagon. Sunsilk’s Gang of Girls launched in June 2006 was among the first ones, and it became a success story in creating online communities. “What was initially started as an e-mail forum discussing hair care issues among young girls, has close to eight lakh members today and they are not discussing just hair care alone, but a whole lot of stuff from career, to entertainment to celebrity chats,” said Chaya Brian Carvalho, MD & CEO of BC Web Wise, the agency behind the concept.
A few brands have had unprecedented success on the social sites. Tata Nano created significant brand equity for its onelakh-rupee people car using social media, while videos of Vodafone’s ZooZoo ad campaign became an online blockbuster with more than a million views in the very first two weeks of its launch.
The recent campaign for Mitshubishi Cedia, called ‘The Great Driving Challenge’ has also attracted attention. Created by Mumbai-based Experience Commerce, the campaign demands participants (only couples) to create profiles in social media networks with attractive content, related to travel and adventure, in an effort to attract maximum number of votes. It has attracted close to 5,000 entries. After several rounds of elimination and based on the number of votes, three couples will be selected for an all-expense paid 12-day driving challenge abroad covering at least 3,000 km. And while driving around in a Mitsubishi Cedia, they can write and post text, pictures and videos of their journey through gadgets supplied by the company. The ultimate winner, selected on basis of what they blogged and tweeted will also get Rs 10 lakh.
“It is a web-based reality show,” says Rajesh Chokhani, co-founder of EC. According to him, participants in the contest are leveraging their Facebook and Twitter profiles to maximise votes. “Therefore, the traffic is maximum from social media networks,” he adds.
Companies are already setting up separate resources and research departments to study how actions online would impact consumption. With enormous amount of data available, researchers are studying patterns of human interaction in virtual space to predict what they will buy or use. A whole new world is opening up.
jijisun is discussing. 
jijisun 4:16 am on November 19, 2009 Permalink |
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