McKinsey Report

The below link takes you to a McKinsey Quarterly report  -  one of the early reports (Nov 2011) that is now a chorus of high level documents that show a link between social media and sales. They throw increasing doubt on the veracity of people who have so loudly claimed that eCommerce is not viable.

A more recent and easier to read report, by The Economist Intelligence Unit, showing some similar results is here.

The McKinsey report summarises with three important observations that will impact the thinking of CEOs:

• Fully networked organizations realize competitive gains and performance improvements.
Senior executives should think strategically about how social technologies can support
business processes….
• Don’t rest on any laurels: competition will increase…  ….many companies categorized as networked organizations last year slipped to a lower rung this year (due to the competition gearing up).
• Companies should prepare for more disruptions. Social media gets more hectic tomorrow, not less

111101 McKinsey Report – How social technologies are extending the organisation

Are you engaged?

Below is a reinforcing take on the powerful survey by The Economist Intelligence Unit and PulsePoint. As e-Marketer reports (below), CEOs are collectively acknowledging positive results from engaging in social media, and most say they are seeing a spike in their sales by letting customers talk about their brands on social media platforms, even if some chatter is negative.

Increasingly, too, (this time Roy Morgan research) CEOs are relying on the internet, not newspapers, as their main source of information. While this survey is now almost a year old it tells a powerful story: if you want to be seen on the executive level you don’t have to be in the AFR or The Australian (hardcopies).

The next breakthrough is progressively better measurement of stakeholder loyalty to companies (Corporate PR) – and customers to brands (Consumer PR). Plus, more knowledge of what helps customers take the plunge ‘across the paywall’ and purchase.

It’s an exciting time, if you are engaged and enjoying the ride; scary if you are not.

For Brands, Social Media Shows Returns but Measurement Hurdles Remain (e-Marketer.com)

MAY 1, 2012

Most CEO's 'get it'.

C-suite executives are increasingly convinced of the benefits of engaging with their customers on social media platforms. A February 2012 survey of 329 senior executives in North America by management and digital consulting firm PulsePoint Group and the Economist Intelligence Unit found that the vast majority of companies who had invested in social media saw a positive shift in their bottom line as a result.

Executives who said their companies had established an extensive social media presence reported a return on investment that was more than four times that of companies with little or no social network engagement activity.

The benefits of social media were especially pronounced in a few select areas. Fully 84% of executives polled said that social media campaigns had increased the effectiveness of marketing and sales efforts, while 81% said a social media presence had helped their companies increase market share.

Companies should use social media to create spaces for consumers to have meaningful conversations with employees and other stakeholders. Almost seven in 10 respondents said they had seen a spike in their sales by letting customers talk about their brands on social media platforms, even if some of that dialogue was negative. This kind of approach builds trust and credibility with consumers, potentially transforming them into brand advocates whose value is immense, if difficult to measure.

Despite these positive signs for social media campaigns, assessments of their effectiveness remain largely subjective. Almost half of executives said that the major impediment to social media campaigns was the lack of a standardized metric that can measure a return on investment. While measuring followers and Facebook “likes” provides marketers with a hard number, no one yet knows how those numbers translate into a quantifiable return for brands.

A Goleman article on using EQ in business has become one of the 10 most read HBR pieces of all time.

A high emotional intelligence is critical for managing relationships – and in our experience, being interested in people and what makes them tick is step one in attaining it. The caveat is of course that high EQ is just one element in being good at communications. For instance, we have just gone through a hiring process for a person who will be engaging with people, a lot of it by telephone, so the first interview was a quick phonecall – as how a person ‘sounds’ (accent, warmth, maturity) becomes critical. It ain’t easy.

The Relationship between Emotional Intelligence and Good PR

April 17, 2012 | Author Sara Fletcher

In order to succeed in public relations, you’ll need a wide variety of skills and traits, ranging from confidence, communication and listening skills. However, if you take a sample of the best public relations professionals in the business, they all have one thing in common – emotional intelligence. The ability to perceive emotions of others and make wise judgments make the difference between a good and great professional.

Defining Emotional Intelligence

First of all, what is emotional intelligence? Emotional intelligence is the individual’s ability to identify, assess and control the emotions of themselves and others. There are two main components to emotional intelligence: personal competence and social competence. Each of these two components are thus broken down into two skills, related to the ability to manage behavior, handle social complexities and make personal decisions.

Traditionally, IQ was seen as the main determinant for the individual’s potential for success.  However, there was a missing connection between success and high performers. Recent studies are showing that emotional intelligence was present among successful individuals and was the critical factor that set them apart from others.

What’s the Connection between Emotional Intelligence and Public Relations?

In its core, emotional intelligence is comprised of four traits. These four traits, important for successful public relations professionals, are as follows:

• Self Awareness

Self awareness determines the individual’s ability to perceive emotions and stay abreast of his or her own emotional state. It would not do if the individual in charge of public relations lost control of his or her temper, as they may reflect poorly on the company. Even worse, this may lead to a major PR disaster, fueled by angry voices on the Internet. As a result, self awareness is a critical skill for PR professionals, as it helps them stay calm and in control.

• Self Management

Self management is a key skill for personal competence, and involves the ability to control emotions and adapt to changing circumstances. As mentioned before, it is vital for PR professionals to be able to maintain his or her temper. But in addition, they must always be flexible to the changes that arise in the industry. Public relations is an active, changing environment, and requires the individual to be highly organized and efficient in order to succeed.

• Social Awareness

Emotional intelligence is more than just understanding emotions – it also determines one’s actions regarding those emotions. Social awareness is the ability to pick up on the emotions of others and understand their connection to social networks. Public relations professionals are interacting with clients, media members, and others on a daily basis, and must survive in a constantly changing environment.

• Relationship Management

Finally, relationship management is the ability to use the awareness of emotions to manage interactions. This skill is especially important for public relations professionals, whose entire livelihoods depend on relationship management. They must be able to connect with a wide variety of individuals, ranging from media members to customers. A high level of relationship management will allow them to keep track of different connections and maintain the image of their company.

Sara Fletcher is a writer at Talent Smart, a leading provider of emotional intelligence and DISC assessment. She has written on a variety of topics, ranging from small business, sports, and career advice.

Images: http://emotionalintelligenceaustralia.com.au

The Queen of brand management

Integral to this is the concept of community relations – or how we get along in the communities in which we make our profit, generally the city or country where we live; reputation and brand management.  1. This article poses two views, Friedman’s (to make a profit) and Taft’s (to serve others).  2. This article poses Porter’s view (increase profits in ways that serves others).  3. Or do we just peddle flatout and hope Wayne Swan’s budget doesn’t stuff things for all of us.   The corporate affairs balancing act. Thoughts?

Melbourne 16 April 2012: The production of some of Australia’s favourite beverages will become greener thanks to a partnership between leading environmental services company, CO2 Australia, a wholly-owned subsidiary of ASX listed CO2 Group, and the brewers of the famous Bundaberg Ginger Beer, Bundaberg Brewed Drinks.

The two companies, with the support of the Queensland Department of Employment, Economic Development and Innovation (DEEDI), have established a unique carbon offset project at Moura, Queensland, 300 kilometres west of Bundaberg.

The new project will allow Bundaberg Brewed Drinks to reduce its carbon footprint and provide additional environmental benefits to the landscape. The project will be established and managed by CO2 Australia.

“This is a very exciting project for CO2 Australia, as it allows for the ongoing diversification of the range of forest carbon projects that we are offering and the range of landscapes over which we can offer them. It’s particularly positive for us because it means we are now operating on-the-ground in Queensland, a state with huge potential for carbon projects,” said Mr Andrew Grant, Chief Executive Officer of CO2 Group.

“At Bundaberg Brewed Drinks we pride ourselves on supporting the community and partnering with local suppliers wherever we can to deliver the finest brewed beverages,” said Bundaberg Brewed Drinks Chief Executive Officer, Mr John McLean.

“As a company, we are committed to looking at ways to improve how we do things.  We are proud to now invest in a forest that offsets carbon and creates habitat for native wildlife. As a family company, we understand the need to reduce our carbon footprint for the benefit of future generations,” said Mr McLean.

Bundaberg Brewed Drinks chose to partner with CO2 Australia for the project because of its experience and success in managing similar initiatives.

The project has the support of DEEDI who has provided expert advice, as well as key resources including seed from elite provenances for the planting. On top of reducing greenhouse emissions, the project will be used as a resource for research and development activities over coming decades.

CO2 Australia, which has been operating since 2004, has 22,000 hectares of carbon sink plantings (equating to 33 million trees) under its management. CO2 Australia can help companies with the development of low-cost, long-term carbon forest assets; sourcing eligible carbon credits from the market; and creating cost-effective carbon trading solutions.

For more information visit www.co2australia.com.au and www.bundaberg.com.

With the explosion of social media there is already so much information out there about you. Your photos, your family, your personal information. So you have already become a brand – you are the second brand of the company. Now it’s something you have to face, and in this new landscape, something you have  to work on.

Is that such an alien concept? Well not if you are Gen Y. Everyone on Facebook knows all about their brand. There’s the carefully selected photo, and the content, all of which tells us as story about that person, the brand, based on what that person has published. And we are all on LinkedIn  – or most of us are. And if we are not, that says something about us too doesn’t it?

So is there room for an introverted CEO? Well actually yes, but in your case, that profile needs to tell that story  – the story of a quiet achiever.

How’s your brand?

The top two areas where C-level executives thought social engagement had real value were improved marketing and sales effectiveness (84%) and increased sales and market share (81%) – (Slide 6).

This is emerging information, made stronger because The Economist Intelligence Unit is behind this survey. This is important because conventional wisdom has always been that social media’s strength is increasing reputation and brand – not sales. The survey indicates:

 to the “marketing-PR people”?

A: I think it is a very brave CEO in many B2C sectors who is not totally familiar with SM, if not the minutiae, then at least its power: car companies, banks, newspapers, clothing stores, electrical retailers – a thorough knowledge of SM is already the difference between success and failure. Oh, and bookstores. And what about the too-slow companies in other sectors yet to be hammered for ignoring it – universities, charities,  tourist enterprises, shopping malls, and more…

Q: A PR mentor recently told me he was seeing strategy proposals that were entirely social media based. I’d be interested in what you’ve found?

A: Put simply, I don’t think a CEO can consider a B2B or B2C relationship without social media – it is central to reputation and to sales. In 2012, I can’t conceive PR work where social media isn’t front and centre. Where do you go when you want to check out a company? The website, probably. Soon, if not now, (based on the available research) you will go to blogsites, Facebook, LinkedIn, Twitter, productreview.com.au etc, to look at interaction with the public (the complaints/compliments).

A telling article here (http://goo.gl/KkJKH), on US city councils and social media. The university study writes: “Rapid growth in local government use of social media reflects the increased participation of the population on sites like Facebook, Twitter, YouTube, and Flickr. A recent survey by the Pew Internet and American Life Project (Hampton et al. 2011) found that 59 percent of American adults used at least one social networking site.”

So, traditional media (newspapers) is a sort of PR fringe benefit now, trust in what journalists write is low, and readers have alternatives – a story in the AFR/SMH/The Aust/Age (unless it is a major piece or a lift out) is mainly good for staff morale or shareholder morale. TV is a different story – a positive story in T/T, ACA, 60 Mins, etc can create a massive lift in sales and reputation. A series of negative stories can do enormous damage ( the recovery requires effective social media).

Government Relations and Community Relations? Again, social media is critical. If I was a politician about to meet company representatives in my electorate, and discovered the company wasn’t engaging with clients or the public with social media, I would assume the CEO wasn’t interested in Community Relations (A mining company with no social media vs. activists with effective social media = no contest). It’s very hard for a politician to support a company with no interest in engaging with the voting public.

Investor Relations? No social media = no investors (almost).

Three quick points:

• Social media is ours for the taking
• China presents tomorrow’s PR opportunities, for all of us.
• With status comes standards. We will need to lift our game.

1. Social media is ours for the taking

Of the triumvirate (advertising, PR, and other forms of marketing/promotion), PR has the most to gain. My thesis is: the rewards are coming.

First, the cornerstone of PR is openness and trust; likewise for social media, led by consumers increasingly learning to sniff spin. This creates a problem for some PR sectors (e.g. government spin doctors), but a greater problem for marketing and advertising. Truth in advertising is increasingly mandated by legislation restricting the way food, cosmetic, or pharma products are presented to the public.

Second, social and online media is ultimately about good quality content, not promotion or one-liners, and so again PR is called to centre stage.

Third, journalism is going to be increasingly starved of funds as traditional media continues to restructure and move online, and will increasingly depend on PR for content.

The stress appears to be on upper management. Australian research in November by Pitcher Partnersacross nearly 500 companies found that:

• 83% of CEO’s felt their marketing activities were ineffective;
• 79% of CEO’s also believed their marketing contributed little if anything to actually generating revenue.

The response? It appears to be, ’More PR please.’ Research commissioned by the Public Relations Society of America found that:

• 98% of the 204 U.S. business leaders polled believe that business schools need to incorporate instruction on corporate communication and reputation management into the MBA curriculum.
• 94% of executives believe that top management needs additional training in core communications disciplines.

2. China presents tomorrow’s opportunity, for all of us.

Go East Young Man. Apologies to Horace Greeley, (New York Tribune, 1865): “Go West, young man, and grow up with the country”.

In today’s language: simply follow the money, and the emergence of an enormous middle class hungry for consumer goods and knowledge. PR has not yet taken off in China, where it is seen as a western discipline/invention/affliction (likewise internet freedom, the connecting link being ’openness and trust’); but my thesis is, that will change – the rewards are coming. In the words of our IPREX comrade in Beijing, Maggie Chan of Newell PR:  “Best Practice public relations and corporate communication is in its infancy for companies in China, but it will mature quickly. The social media channels like Weibo (250m members) are enormous and businesses are learning quickly how to communicate through them. We Chinese are very good at business and with money, but responding to stakeholder feedback is not a strong point. When it finally does take off, many many companies will want to learn how to interact with the public. This will not happen this year as everyone watches the change of leadership in Beijing, but it will happen.”  (For more on this go here.)

Now what does this mean for all of us? The reason Australia has a healthy economy is because the Chinese need our coal and iron ore (and everything else we can dig up!) and so we are having one of the first ‘China’ experiences. Other countries will follow. Australian Treasury Secretary Martin Parkinson, in mid 2011 expressed this China syndrome well (Sustaining Growth in Living Standards in the Asian Century):

“On some projections, China and India are expected to comprise around one-third of world GDP by 2030…

“…short of major social dislocation or global geo-strategic tensions it is hard to believe that the industrialisation and urbanisation currently underway in both countries does not have many years to run. Let me be clear, I am not suggesting that China’s growth path will be without volatility, but rather that viewed through the prism of history, this will look like cycles around a strong trend in growth. This means the impacts on Australia will be sustained and profound.”

Back to openness and trust. Yes, China has a distance to travel. One of the real issues for the leadership must be, who do they turn to for a role model? There’s not a lot of how-to guidance coming from Washington in the run-up to November this year. Or from Murdoch in Britain. Or from Greece and Italy. Or from the Middle East. In reality the Middle East has shown China that the path to openness and trust is riddled with hazards.

3. We are all going to have to lift our game.

Again, my thesis is that the rewards for PR practitioners are coming, but will arrive at a price.

Journalism has its more strict Codes of Conduct, that have evolved over three millennia – it is about 130 years since Randolph Hearst became proprietor of the San Francisco Examiner and gave birth to popular journalism in the US, and the need for standards to regulate it. And in journalism, if the public doesn’t catch misbehaviour, someone else will – witness the Murdoch debacle.

Such public outings are ahead of the PR industry, as we become more prominent in online media. Metrics and measurement and the need for ROI will increase that pressure.

This trend was identified in the recent UK survey by the Chartered Institute of Public Relations which recommended actions, including:

• Education and training for public relations practice need to be taken to higher levels, which will involve greater collaboration with  education for public relations;
• Codes of Conduct should be strengthened.