Tag Archives: social media

Who is your most valuable customer?

Yesterday I saw this sign in a food shop in Helsinki. The owner is rewarding people who promote his shop by giving them a small discount.

It seems that Kellogs are also playing with this idea, with people able to pay for cereal with a tweet.

I said a while back that the most valuable customers are not always the ones who spend the most, but can be the ones who promote you the most.

The CLV should be the Social CLV.

The best CRM database systems in the future will measure transaction activity and social activity, and reward you for both. I don’t really know anyone who is really nailing this yet. Do you?

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The POSSE media model

It’s been a few years since I posted the original Own, Bought and Earned media model and the slightly updated version a little while later.

Although it is still a good way to think through your media options, it does feel as though the model is a bit too simple nowadays.

So I have come up with a new one, called the POSSE media model. I’ll explain it below the diagram:

The POSSE media model is built on two basic levels of activity: to produce and distribute content. The better you do these two things (and the more it is based on listening and understanding your audience) the more media exposure you will earn.

Produce content. Can be classed as Owned and/or Social

  • Owned

This is the media you have (more-or-less) complete control over, e.g. a corporate web-site, or a retail store.

  • Social

This refers to branded social media presence such as Facebook, Twitter, YouTube, Vimeo. Social platforms that give you a chance to build a presence as a brand. Note that you do not have much control over these in terms of functionality, and the terms of the service can change at any point. (Steve Sponder calls this Borrowed media, which makes sense but I think overstates the transience of these networks. Also I think Social works as a term for now at least, as it is widely understood by people).

  • Overlap of Social + Owned

This is at least two things:

1. Brand-generated platforms or communities specifically designed for customers to co-create and collaborate with brands. (e.g. Dell’s IdeaStorm and Starbuck’s MyStarbucksIdea.) (what Brian Solis calls “Shared” media)

2. Own content such as videos that are the fuel for a brand’s social channels. You do have complete control over the format of your own video (within reason) but the video ultimately boosts other media owners’ site visits. They may also place ads before or after your content without asking your permissions, for example.

Distribute content: can be classified as Paid and/or Seeded

  • Paid

Media placements that you have paid for. Think SEM, banners, sponsorships. It can also be “traditional” media placements such as TV, Print, Outdoor. Paid media is still important, especially if you want a lot of people to see a fairly consistent message about you.

  • Seeded

This is referring to seeding of content among “influencers”. PR agencies, or WOM agencies like 1000heads, can help to build these relationships, identifying who to speak to and how to persuade them to feature your content. Sometimes these will be the people with the biggest reach, but often those people are deluged with requests. So instead, the seeding often happens with brand advocates, people who are genuinely fans of your product or service, or at least people who have shown a previous interest in products like yours in the past. This helps with the credibility and authenticity of their post(s).

  • Overlap of Paid + Seeded

This is where I would put things such as sponsored stories on Facebook, or Twitter’s promoted products, both of which cost money and are based on advertising to people’s social graph. It is interesting that social-media agencies are the ones who are picking up on this, whereas traditional media agencies are struggling with it. “Paid seeding” is also possible using partners such as GoViral who have a network of video sites, or by paying YouTube to feature your video to its users to give it an initial push and get it noticed.

If you do all of the above well, you get some “Earned Media”

This is people posting and talking about your product and its advertising. If you do things well with your own media, choose and manage your social presences wisely, seed to the right people at the right time, and perhaps pay to get noticed by more people, then you should hopefully earn media too. It will give your content extra push (distribution), and you will have earned it so these will be considered the most authentic voices of all. But you cannot guaranteed the message at all, so a lot of what is distributed may be unrelated to your intended communications. Really, positive earned media is a measure of how interesting your content is and how well you distributed it.

Why “POSSE”?

Well, acronyms are always cool, aren’t they?

But in this case, it serves a second purpose. New media techniques such as these are about people, and they need skilled people to make them happen. You can’t have one person spending a load on one advert and expect it to succeed like it used to. Instead, you need to hire many people, with new and diverse skills: editorial content, community management, search engine optimization, blogger relationship management, UX experts, etc etc. In other words, you can’t fix this problem by throwing money at it; to succeed in this new media landscape, you need the right kind of POSSE.


– This thinking was hugely influenced by the original Nokia digital posse (you know who you are), plus lots of people who commented online and in person about my original post.
Brian Solis, who’s Brandsphere is very smart and taught me a lot, but maybe a little complicated for me.
Steve Sponder, who made the excellent PONBE model which clearly influenced this model.

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Social Media and Competitive Advantage

I have said before that you don’t need a social media strategy, you need a strategy. Social Media is one possible way to create the value that is needed to have a competitive business.

Chris Kirubi, Chairman of Coca Cola Nairobi, agrees with me: “You don’t need a social media strategy – You need a brand strategy that leverages social media. Don’t get off the brand strategy just because there’s a new communications channel, that’s how you lose the plot as a brand. Technology is the tail, not the dog.”

Fundamentally, business still primarily exist to make profit, and they still need a strategy that defines how they intend to do that. Their strategy should essentially rest on how they create value in a difficult-to-copy way.

30 years ago, Michael Porter wrote about the three ways to achieve Competitive Advantage: cost leadership, differentiation, and focus. 11 years later, he simplified this further, saying: “Competitive advantage can be divided into two basic types: lower costs than rivals, or the ability to differentiate and command a premium price that exceeds the extra costs of doing so. Any superior performing firm has achieved one type of advantage, the other or both”

When considering a Social Media program, maybe we should analyse it in terms of these three strategic pillars:

Cost Leadership

Social Media is one way to achieve cost savings and operational excellence. Twitter can be a cheaper way to service customers. Even better would be building an army of advocates who like nothing more than to answer your questions in social spaces for you, which is a more scalable solution.

The cost of marketing can also be reduced using social media, as you can earn media. A Facebook message that reaches a million people can be a more cost-effective way to get a message out than buying media. (Although note that earning media has less guarantees than buying media, so a healthy combination is optimal.)


I think it is possible to use Social Media to augment your product offering, and actually provide a better experience for your customers. Chris Brogan calls it Guest Experience Design. Whether this be solving people’s problems via Twitter and thereby reducing churn, or providing useful well-timed info to customers so that they make the most out of the product, the key is using social media to actually increase value to your customer. This should lead to higher sales, or possibly to the ability to charge a price premium.


This is where Social Media is at its best. Here you build a community , a metaphorical bonfire, to which you can get close and serve better than anyone else; some people have defined this as Customer Intimacy.

The important thing here is that you have the right people at your bonfire i.e. the people who are likely to buy more of your product. Fiskars did this brilliantly with their scapbooking community The Fiskateers.

But, in my opinion, this is why Pepsi Refresh Everything has not increased sales: although it gathered millions of “likes”, the community it was building had no interest in soft drinks; in fact this charity-concious group may have been less likely than most to buy sugary drinks. So build a community, but make sure it is one that will want your product.

Of course, you can also focus on a community who’s only common objective is to buy your product. The special offers provided by the likes of @Delloutlet are effective: in simple terms, if you deliver good, bespoke offers via a channel such as Twitter, you will get followers, clicks, and (most importantly) sales. Just as you would if they were on an email list. Note that there is nothing particularly “social” about this use of social media!

Question to ask yourself

If your social media program is not helping you achieve one of these three competitive advantages, then perhaps it’s time to question whether you really need it.

After all, Apple is doing just fine without a Twitter channel.

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You don’t need a Social Media Strategy.

(You just need a strategy)

Right, so now I’m glad that we all agree that there is no such thing as social media.

And that we also agree that everything is social media.

So, we should move on to my next bone of contention:

There is no such thing as a “social media strategy”.

You do of course need a good strategy.

And you definitely need clear goals.

And one of the best ways for you to reach your shiny, clearly-defined goals will probably be to make use of some of the kick-ass new social tools like Twitter and Facebook.

But they don’t need their own separate strategy.

Having a social media strategy is kind of like having a paper-and-pen strategy.

And that just don’t make no sense.

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Social Media is NOT MEDIA AT ALL

I’m amazed I haven’t really considered this before, but what we all call Social Media is actually the exact opposite of media.

Derivation of the word Media: Latin: medium is the neuter form of the adjective medius, meaning “middle”; as well as, a neuter noun meaning, “the middle”

The singular, medium, early developed the meaning “an intervening agency, means, or instrument” and was first applied to newspapers two centuries ago.

Conversely, “Social Media” is a set of tools for people to communicate between themselves, platforms for interaction and relationships, not content and ads.

What do these social tools (Facebook etc) do?

They disinterMEDIAte of course!

“Who said this is media? Consumers weren’t trying to generate media. They were trying to talk to somebody. So it just seems a bit arrogant. … We hijack their own conversations, their own thoughts and feelings, and try to monetize it.”
Ted McConnell, General Manager-Interactive Marketing and Innovation at Procter & Gamble Co

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