Tuesday, December 23, 2014

Five Tips To Help CMOs Improve Social Media ROI in 2015

The coming year will be a watershed one for social media marketing, I predict, and not in a positive way. A topic that was only whispered about in private conversations early in the year is now being openly discussed: For many brands, earned media and content marketing are not delivering results in line with the investments. Some claim our metrics and strategies must mature, but it is getting harder to ignore the limitations of marketing in the social channel. So unavoidable is this discussion that even at the Social Media Today Social Shake-Up, a confab of social elite, a speaker asked from the main stage, "In a year, will any of you produce a deck with 'social' in its title?"

While social circles are buzzing with increasingly sober discussions of the channel's difficulties delivering marketing results, that conversation seems not to have reached the ears of the CMO quite yet. Mainstream marketing media, which was late to recognize the growing investment in social media marketing, is now tardy in covering the growing body of data demonstrating social's challenges as a marketing channel.

Adweek, continuing its trend of being impressed with engagement rather than results, recently featured an article on the "top Tumblr posts of 2014." These posts were not selected as "top" because they delivered any marketing ROI but because lots of people liked them, and thus Adweek has once again uncovered that deep marketing insight that people love inspirational quotes, hot models, animated GIFs and pets. (Shocking!) This is representative of the coverage that social media continues to receive from the marketing media--big numbers lead while investments bleed.

Since your CMO does not seem to be getting good advice to guide decisions on social investments, I'd like to offer up five tips to help him or her consider how to manage social media budgets and efforts in 2015:

  • Stop trying to make your brand interesting with tweets and posts; instead, give people a reason to talk about your brand in meaningful ways. The organic reach of brand content on Facebook is dying. Not dwindling; dying. The story is little different on other social networks. Brand engagement on Twitter is minuscule and, although engagement on Instagram is fine today, it is only a matter of time before Instagram goes the way of other social networks before it.

    By the end of 2015, the talk will be about zero reach in brands' organic social media marketing efforts, and it will become impossible to ignore that brand publishing is not and never was going to be the way to succeed in social media. The real social media strategy that has worked from the beginning is to get people talking with each other, not about brand content but about actual products and services. The reason is that people trust each other far more than they trust you and your brand.

    There are several ways to leverage peer-to-peer brand communications. Bring trusted consumer ratings and observations into your site, integrated on the pages where prospects consider your products and services, as USAA has done on product pages. Leverage trusted relationships to create connections between your brand and prospects, as Ameriprise does with its LinkedIn "Find an Advisor" feature. Encourage positive comments, not on Twitter where tweets are quickly lost in the void, but on the rating and review sites that people trust to help them make purchase decisions. In 2015, CMOs will be forced to realize that the key to social media success is not publishing content but getting people talking with each other about brands' products and services.
  • Stop trying to go viral; instead, use social media to solve consumer problems:  Viral posts get a lot of attention because everyone loves big numbers, but there is little evidence they drive brand value. KMart had the most viral brand video in 2013, but it didn't stop the retailer's continued slide. The same thing happened in 2014: This year's most viral brand campaign was the Ellen Oscar selfie, but despite Publicis CEO Maurice Levy's claim it delivered Samsung a billion dollars of value, Samsung's smartphone market share slipped 25% from Q3 2013 to Q3 2014. (Where viral campaigns tend to help is not with established brands but with up and comers such as HelloFlo and Wren, but even then, the one-in-a-million shot of achieving "viral' scale is so remote, the few success stories hardly suggest that viral marketing is a smart strategy.)

    Your marketing goal is not to go viral; it's not even to get engagement. Your marketing goal is to deliver demonstrable business results, and that means changing consumer behaviors and attitudes. Viral videos too often sacrifice brand impact for entertainment value, and that is a lousy trade to make.

    Rather than try to be funny, instead focus on solving consumer problems. Fifth Third Bank didn't make the waves that Samsung did, but its Reemploy campaign got unemployed mortgage borrowers back to work and delivered the brand the sort of "buzz" that encourages consideration. USAA partnered with the NFL for a Salute to Service campaign that increased appreciation for military service members, raised over $400,000 for military support organizations and generated considerable social media buzz with on-field events.
  • Stop saying "Content is King." Start focusing brand-building energies on the Customer Experience. First exercise: Other than brands whose product actually is content, name a brand you purchase regularly because of content it produces. Now list the brands to which you are loyal because their products or services furnish a great and consistent experience. How do those numbers compare?

    Here's another exercise: List brands you know that have achieved significant success in the past two decades years with content. Then, list the brands that came out of nowhere with little advertising or content but built World of Mouth based on their product or service experience. (Here's a list to get you started on the latter: Ebay, Amazon, Uber, Nest, Square, Flip Video, Google, Krispy Kreme, Zappos, Tesla, Facebook, Apple Store, Jawbone, Angry Birds, PayPal, Evernote, Dropbox and Warby Parker.)

    There you go--I have cured you of the need to ever again say "Content is king" in just two paragraphs. Content is not king--customer experience is king. Why do marketers keep repeating that tired and untrue phrase? Probably because content seems easy to do (just a hire a "brand journalist," whatever that is), is in their wheelhouse (they have been producing ads for decades, after all), and marketers generally control content but not the product and service experience. Well, it is long past time for that to change.

    Advertising and content are important, but nothing is more powerful than Customer Experience. This has always been the case, but in an age of transparency where media is splintering, mass media is slipping and consumers have greater control over communication channels, it is not content but Customer Experience that fills the top of the funnel. Marketers can no longer afford to ignore the high-impact product and service experiences being fashioned by others in the organization while they worry about less powerful ad impressions and social engagement. Smart marketers must turn inward and ensure that the brand experience is crafted end-to-end--not just what happens leading up to purchase but what happens afterwards--because that is where true brand building occurs.
  • Stop being lied to and start demanding better information. Who do you expect will tell the CMO the truth that social media marketing is widely failing to meet expectations? The professionals getting paychecks to produce content for social channels? The agency trying to maximize utilization of its storytellers and community managers? The authors whose books extolling the value of earned media launched their careers? A social media industry has been built to separate the CMO from his or her budget, which is why marketing leaders must seek out the real, unadulterated and unbiased data and insight about social media marketing.

    There is a lot of bad data and analysis out there, and even data from reliable sources can be twisted and misrepresented. For example, dozens of blog posts have mentioned that IBM's recent Black Friday white paper reported that Facebook traffic delivered an average of $109.94 per order over Thanksgiving weekend. That sounds important, but is it really without knowing the scale of orders delivered? IBM is suspiciously silent on that topic considering its 2013 study found that social media drove a mere 1% of purchases. While IBM may not be divulging social network traffic's share of purchases, Custora is. The company evaluated data from 100 US online retailers, 100 million online shoppers and over $40 billion in transaction revenue in the first two weeks of December. It found that social media (including Facebook, Twitter, Instagram, and Pinterest) drove just 2% of orders (down from 2.5% during the same period in 2013).

    The time has come for marketers to get more critical about the data and analysis they receive. If marketing leaders rely on incomplete, unreliable or misrepresented data to drive social media decisions, they have no one to blame but themselves for disappointing outcomes.
  • Your social media metrics suck, so change them. Social media has been Goodhart's Law in action: "When a measure becomes a target, it ceases to be a good measure."

    Likes, retweets and shares were briefly meaningful in the early days of social, when brands earned them solely by offering great products and services, but the second those social engagement metrics became goals rather than measures of success, everything changed. Brands started buying fans with contests, sweepstakes and giveaways. Community managers started gaming engagement with posts of puppies and "like-bait" images. Fan counts soared and engagement rose, but since these tactics were designed to yield positive social media metrics and not valuable business results, it all amounted to little for brands. Is it any wonder that the vast majority of CMOs have no quantitative idea if their social investments are paying off or not? (They're not.)

    If you have a social media scorecard with counts of likes, fans, retweets and pins, throw it out and demand better. Those metrics are easily manipulated and are not measures of business success. Marketing leaders need to focus on more important measures in 2015: Improvements in preference and purchase intent, enhanced share of wallet, beneficial social behaviors such as recommendations, and financial measures including repurchase, clicks and conversions. Those are not as easy to measure as likes and retweets, but the most valuable marketing metrics are rarely the easiest of obtain.
By the end of 2015, I believe we will be having a much different conversation about social media with substantially less focus on brand content and more about social products, social services and social good. If your CMO uses the five tips mentioned above, he or she can be ahead of the game and ensure the company is aligning its marketing budgets to the strategies most likely to deliver results that matter. Or, brands can keep running social sweepstakes, doing funny videos and begging for likes and shares, but I can promise those tactics will not get the job done for the Marketing department, and by the end of 2015, that will be impossible to hide.

Friday, December 5, 2014

Social Media Marketing: It's All Been Said Before

I find it difficult to get inspired to write about social media marketing any longer. Where others see ongoing brand difficulties in social media and claim "we're still learning," I see a marketing channel that is fully mature (and by some measures in decline).

As you review all of the inevitable blog posts this month that list 2014's top PR blunders and Social Media #Fail examples, ask yourself if these mistakes were ones caused by an exploration of untested strategies in a new medium or an inability to apply (or perhaps believe) the available data and lessons learned? I think you will find yourself agreeing with me--this year's crop of social media errors and disasters are no different than last year's--same causes, same mistakes, same outcomes. It's all been said before.

The same can be said for this year's success stories in social media. Thousands of brands ran social media promotions, shared content on social networks and maintained blogs and podcasts. How many can claim demonstrable success and offer repeatable examples for others to follow? And for the rare ones that can, did they get there with some wildly innovative strategy or by the same customer-focused, data-driven, omni-channel process that worked in social media in 2013 (and pretty much every other medium before that)? It's all been said before.

Some may argue that the rise of Instagram was a new and exciting development this year for brands, but is this really true? I mean, sure, your brand can chase the higher engagement presently available on Instagram, but by this time next year we will be talking about how paid media is pushing aside organic content and griping about the declining engagement rates on that platform, just as we are about Facebook today. It's all been said before.

If chasing weary, disinterested and distrusting consumers from one new social network to another sounds like effective marketing strategy, feel free to pursue it, but you will need to pardon me for not sharing in your enthusiasm. I aspire to be a brand and business builder, not an engagement hacker.

The news about the higher engagement rates on Instagram is hardly the only recent instance when I saw some newsworthy social media situation, considered sharing my perspective on my blog, and ultimately rejected the idea. The reason is that I can no longer find a way to cover this space without resorting to cutting and pasting words and messages I have already shared before. For example:

The secret to social media success (and failure) is no longer secret. Companies need to stop talking and start listening. They need to stop broadcasting and start responding. They need to stop posting to people and instead encourage people to start talking with each other. They need to stop promoting new products in social media and instead use social to collaborate when developing new products. They need to stop publishing content they hope people will share and instead give people product experiences consumers actually want to share. They need stop trying to be entertaining in social media and instead offer great customer care in the channel. They need to stop counting fans and tallying engagement and start creating advocates and measuring business value. And finally, brands need to stop positioning themselves as more caring, more transparent and more committed to the customer and instead be more caring, more transparent and more committed to the customer.

If you find yourself nodding your head with that last paragraph, take a moment to parse the first part of each sentence from the second. The first part describes marketing activities (broadcasting, promoting, publishing content, being entertaining, tallying engagement, positioning) while the second part describes activities outside of marketing (listening, responding, product development, customer service, earning advocacy, being better corporate citizens).  Therein lies my growing weariness with the topic of social media marketing--marketing is literally the least interesting thing brands can do in social media.

To me, that describes the big shift underway (both in the world and on my blog). Social media remains a powerful force reshaping our lives and companies, but that does not mean it is a powerful marketing tool. So, as I have in 2014, I will continue to focus on how customer experience drives great results (in social and elsewhere) and how social behaviors and technologies are reshaping consumption and business models in the collaborative economy. But whether some brand did a cute Vine or got 500 shares of its hilarious Instagram picture is no longer very interesting to me (and I am frankly unsure why it would be interesting to anyone else).

I said I hate to repeat myself, but here are a couple of things that bear repeating: Social media is not a megaphone for brands; it is a mirror. It does not give your brand "a voice"; it gives consumers a voice they can use to share their good and bad brand experiences. It does not allow you to fashion messages that change minds; it reflects what the brand is and does in a way that changes minds (or, more likely, not).

If you want better brand results in social media in 2015, do less marketing in the channel and find ways to treat your customers better. The brands that will succeed this coming year will not be the ones developing content and leveraging Instagram but the ones developing better relationships via product and services in consumers' real and digital worlds.

Friday, November 21, 2014

Why an Uber Decline May Be Good for the Emerging Collaborative Economy

Uber has been a poster child for the emerging sharing economy. While other collaborative economy startups like Airbnb and LendingClub have grown and garnered attention, they have yet to create the sort of impact within their verticals that Uber has in the livery business. In San Francisco, for example, Uber (with an assist from other ride-sharing startups) has already caused a 65% decline in taxicab trips and New York has seen a small but unheard of decline in the price of taxi medallions.

Given Uber's prominence in the early days of the collaborative economy, it may seem odd for me to suggest, but I believe a significant decline in Uber's business may be terrific for the long-term interests of the collective consumption movement. My reasoning is that the sharing economy is not simply about more collaborative products but more collaborative companies. Viewed through this lens, Uber simply has not earned its premiere status in this new business movement.

Uber's embarrassments have been many and frequent, such as:

All of these blunders occured before this week's embarrassing dustup over threats to dig up dirt against critical journalists and their families. Then, as if Uber's crap week needed icing on the clueless cake, the company's CEO, Travis Kalanick, compared his company's woes to those of the residents of Ferguson, MO.

Travis Kalanick (Photo Credit: Silicon Prairie News)
That Uber has a terrible corporate culture is in no doubt. Of course, what would you expect from a CEO that calls his company "Boob-er" for the way it helps him land dates. If the CEO at a traditional company said these sorts of things or presided over a fraction of Uber's PR stumbles, he or she would be shown the door immediately, but Kalanick seems to have nothing to fear, provided he keeps the billions rolling in for investors.  In fact, not only has the latest gaffe caused no apparent ruckus among investors about Kalanick's leadership, one investor--actor Ashton Kutcher--came to the executive team's defense, tweeting "What's so wrong about digging up dirt on shady journalist?"

If Uber's leaders and investors are unwilling to foster the sort of culture consumers want and expect, then perhaps it is time for consumer action. There is a small but growing trend among people deleting Uber from their smartphones. Comedian John Hodgman wrote a blog post saying "I just can't get into the car with those guys any more." Tech writer Nilofer Merchant is also deleting her Uber app. I have deleted mine, and you can too.

Yes, Uber is an astounding service, but is that really enough? Study after study validates consumers' growing desire for better companies--ones that act ethically, contribute to the community and treat both employees and customers better. This is made clear by a slew of research such as Edelman's Trust Barometer and Havas Meaningful Brands study.

We have the power to demand better leaders and companies. If we fail to act now--if we let our love of Uber's service blind us to its terrible and uncollaborative actions--that will only embolden and encourage VCs, startup leaders and others to accept aberrant leadership behaviors and build companies that respect nothing but profits. That is not the collaborative economy I want.

Some may suggest that an Uber failure would be a strike against the new sharing economy, but I believe the opposite is true. The collaborative economy is changing the world, but its progress will be hindered if we support companies that violate every tenet of the social era.

Cash may pay the bills, but trust is what drives the collaborative economy. Trust is the necessary ingredient to convert customers to new ways of consuming goods and to win the support of doubting regulators. Today, Uber's trust-killing antics are harming the entire sharing industry, raising suspicions about the kind of ethics and honesty that are driving crowd companies. At a time when Uber and other sharing economy companies should be winning hearts and minds, Uber's arrogance and mistakes are instead breeding suspicion at the Federal, state and local levels.

The best thing for the collective consumption movement would be for consumers to send a clear and unmistakable message to Uber and its peers. If enough of us act, we can shape the future of this emerging way of doing business. We can and should put the collaboration back into the collaborative economy and help Silicon Valley understand that we want more than better services; we want better companies.

Uber is not the only ride-sharing service around, and I urge you to consider exploring other options such as LyftSidecar and Curb. The next time you use a ride-sharing service, make sure it is one that has earned not just your business but your respect, as well.

(Added note: It seems advisable to point out that my opinions are my own. Moreover, let me state that I want ride sharing in general and Uber in specific to succeed. But on the trajectory it is going, I fear Uber will not only undermine its own success but harm other companies in the budding peer-to-peer economy. If deleting Uber now can bring about a change in its corporate culture and force Uber to be more collaborative, trustworthy and respectful, then I will gladly reinstall the app in the future and feel as if I have helped the company succeed in the long term.)

Sunday, October 12, 2014

The Snappening Blame Game: Protect Yourself and Your Family With Awareness and Action

VentureBeat featured an article entitled, "Who’s to blame for the ‘Snappening?’ You are." While I strongly disagree with the writer's use of the word "blame," I also believe there is nothing wrong with empowering people to take as much control as possible of their privacy and reputation. Those who strive to prevent others from being victimized are too often accused of "blaming the victim," but there is nothing incompatible with assigning blame to criminals while simultaneously helping people to become more informed and protect themselves and their family.

"The Snappening" is the hack and leak of hundreds of thousands of images that people intended to be seen (and immediately deleted) using the Snapchat application. It has been reported that many of these images are of minors. This hacking crime occurred at the same time hundreds of personal photos and videos of celebrities are being leaked, an event disgustingly given the cutesy name of "The Fappening."

Both are crimes, and all blame and legal responsibility rests with the hackers and those distributing the photos. Again, just so I am absolutely clear: The hackers and those distributing users' private photos and other information are wholly to blame ethically and legally. 

That said, there are steps you and your family can take to avoid becoming victims. Saying this does not alleviate hackers from their legal accountability should your family's data be unlawfully collected. All this acknowledges is that we live in an increasingly digital, social and mobile world, and it is vital we recognize and consider the risks associated with our devices, applications, privacy settings and actions.

Telling children not to get into cars with strangers does not blame the victim when tragic situations occur, but it does prevent other children from becoming victims. In the same way, urging our children to understand the risks of their digital, social and mobile actions does not increase their fault should a dreadful crime occur, but it will prevent other children from being victimized as is happening today. Blaming victims is disgusting and wrong; empowering people to avoid becoming victims is smart and caring.

In our digital, social and mobile era, here are some things you and your children must know so that risks can be reduced:

  • Consider the applications you use: Every application you allow on your phone or permit to access your data on social networks increases risk. Who created the app? How will they use your data? Will they protect your data? These are difficult but essential questions we must ask about each and every application that we allow to access our most personal data.

    While few of us possess the technical capability or time to answer these questions specifically, we can take some simple steps: Identify and evaluate the reputation and size of the application developer; consider the access requirements; and review the ratings in the App Store, Google Play and elsewhere.

    The risk posed by third-party apps seems to have contributed to the Snappening leak. Snapchat released a statement saying "Snapchat’s servers were never breached and were not the source of these leaks. Snapchatters were victimized by their use of third-party apps to send and receive Snaps, a practice that we expressly prohibit in our Terms of Use precisely because they compromise our users’ security." In other words, once you allow a third-party application to access and use your Snapchat data, there is nothing Snapchat can do to protect your privacy, and the same is true of other social networks and mobile platforms as well.

    Facebook's Privacy Checkup--stop
    griping Facebook makes privacy
    difficult and use it, already!
    Steps you can take today: Review the applications on your and your children's phones. Do you know and trust the developer of each application?  Do the same for the applications that you and your children have allowed to access Facebook data; to do so, visit Facebook in a browser, click the lock icon on the upper right corner and do a "Privacy Checkup" to review "Your Apps." You can do the same in Twitter--click on your profile image and select "Settings" and "Apps" to revoke access to applications you do not know and trust.

    These steps are vital to protect you and your family. To use a real-world metaphor, no amount of locks on your door can keep you secure from those you freely allow to access and use your home.
  • Consider the people to whom you connect:  If a stranger watched, snapped photos of or followed your family around, you would call the cops. Many people not only ignore that strangers do this online but welcome them to so, because this is what happens when you accept invitations from strangers on services such as Facebook and Foursquare.  The people with whom you connect can know where you are at every moment, see and save your family photos and know other information you may not wish shared.

    Parents, who have your children friended? Do they know them well? I will admit I am not a parent, and I understand issues of trust and privacy are sensitive ones with kids; nonetheless, the same parents who would never allow their kids to talk to strangers in the real world are often willfully ignorant of the strangers talking to and monitoring their children via social and mobile applications.

    Steps you can take today: Review your Facebook and Foursquare friends today, and do the same for your children. Do you know them well enough to give them access to your location, photos and personal communications? Many people seem to feel social pressure to accept and maintain "friend" connections on Facebook. My advice: Get over it. There's nothing wrong with rejecting or deleting a connection from someone you do not know well.  An ounce of prevention is worth a ton of cure when it comes to filtering your friend lists.

  • Consider your security settings: Every application and service you use permits you to set your preferred level of security and privacy. I choose to make most of my Facebook posts public, but I do so with awareness and consideration of what I post. My recommendation to most people is that they do NOT make their posts public by default, and as a rule, children should never do so.

    Nowadays, it is not simply the security settings of applications you must consider but also the settings built into your devices. Thanks to services such as iCloud, Dropbox and Google Drive, many mobile phone users automatically upload their photos and data into the cloud without even knowing. Of course, you can stop that from happening if you want, but then you may lose your photos and data in the event your phone is lost or dies. There is no simple answer to how you should set your or your children's security and privacy settings, but it is important we make informed decisions and take proactive action rather than having an unpleasant surprise later.

    Steps you can take today: First, review the security settings in your applications--who can see your data and what data can they see? As noted above, Facebook has made this much easier with its Privacy Checkup feature.

    Perhaps even more important is for you to use two-factor authentication. It is easy and only adds a smidgen of complexity. Apple has suggested that if the celebrities hacked in the Fappening had used two-factor authentication, their data would still be safe (although I find this a bit disingenuous since iCloud allowed unlimited signon attempts, permitting simple "brute force" attacks to be effective.) You can learn more about two-factor authentication on CNET, but Facebook's two-factor authentication is called "Login Approvals" (found under "Settings" and "Security") and it is easy to use.  You can also learn more about two-factor authentication available for Apple ID, Dropbox and Google.
  • Consider what you capture and share: This is, inevitably, the advice that causes people to start tossing around accusations of "blaming the victim." It seems some people mix up having the right to do something with whether it is wise to do that thing. The two are not the same.

    There is nothing wrong with suggesting people consider the risks associated with taking, storing or sharing nude selfies. Yes, you have a right to do so (if you are an adult). No, doing so does not in any way reduce others' culpability should they hack and share your nude selfies. But yes, taking nude selfies does, in fact, increase risk they could be accessed and distributed without your permission. So go ahead--strip down and snap away--just do so with knowledge it comes with risks: You can lose your phone, your iCloud account can be compromised and the people with whom you share may save and disseminate them further (even if you use Snapchat).

    Of course, the same is true of ANY data. You can legally post, share or store your social security and credit card number online. It is an insane and risky thing to do, but doing so does not alter the blame or criminal responsibility of anyone who uses that data to steal your identity. Once again, suggesting people consider the potential ramifications of their digital, social and mobile actions is not "blaming the victim" but a simple reminder that the best offense is a good defense when it comes to your personal data.

    Steps you can take today: Simply consider what you capture, store and save on your devices. Do you save your credit card numbers in Evernote? Do you have a photo of your social security card stored on your device (and backed up in the cloud)? Do you save passwords? These are somewhat obvious examples of actions that raise your risks, but there are less obvious ones:
    • He had a "family emergency,"
      posted this and lost his job
      Have you ever shared your "porn name," which includes the street on which you grew up? Have you posted your mother's maiden name as part of #TBT on Facebook or Instagram? Both are examples of information you use to recover your passwords and can be misused to gain access to your accounts and data.
    • Do you share when you and your family are traveling and announce to the world that your home is empty and unguarded?
    • Do you complain about your coworkers on social networks, an action that can cause you to (at worst) lose your job or (at best) lose relationships and reputation?
    • Do you "like" your bank, revealing to others where your financial accounts are maintained?
    • Do you use the same password on every site so that a single hack opens up all of your accounts and data to hackers? (And when is the last time you changed your passwords?)
    • Do you ever call in sick when you are not and then publicly share your leisure activities? (That's another good way to lose your job.)
    • Do you capture and disseminate (even privately) pictures of you and friends doing things that others (such as potential employers, significant others or family members) might judge?
    • Do you often use profanity or poor grammar in your Facebook or Twitter posts? Recruiters react negatively to profanity (65%), grammar and punctuation errors (61%) and references of alcohol use (47%).

Educating and empowering others to make smart decisions is not "blaming the victim" but an act of caring. We must always blame the perpetrators who hack and share our personal information, but empowering people to protect their data and privacy is simply the smart thing to do.

Tuesday, October 7, 2014

Stop Social Media Marketing

Today, I gave a keynote address at the PR + Social Media Summit in my hometown of Milwaukee. My presentation was entitled "Stop Social Media Marketing (Unless)," and I have embedded the deck at the end of this blog post.

I predict that many CMOs will diminish their support for social media, content and earned media marketing in the next year or two, and when they do, careers will be adversely impacted. If your career relies on Marketing Department support for content or social media marketing, now is the time to take stock of the trends and consider some actions to protect your career. It is possible that you work for the right sort of company for which social media is well aligned for Marketing Department expectations---that's the "Unless" part of the title--but, as you will see, I believe this is the exception and not the rule.

What is (and is not) Social Media Marketing?

Before we explore where social media marketing works and where it does not, let's first be clear that the definition of "social media marketing" does not include paid media on social networks. Go ahead and invest in advertising on Facebook and Twitter, just do not call it "social." The most popular forms of advertising on Facebook today are retargeting and custom audiences, neither of which are remotely social, and less than one in six ad dollars use social data.

I suggest a better definition of Social Media Marketing is this: Content authored or encouraged by the brand and shared by Word of Mouth that creates earned media and delivers on Marketing objectives. This definition excludes a couple of things, such as advertising (which is not social) and consumer content not coaxed by a marketing program (which is not marketing). It also excludes social media programs that fail to deliver on key marketing metrics, and therein is the problem for most brands.

The Earned Media Venn Diagram

A simple Venn diagram explains what works and what does not in Social Media Marketing. The first circle includes what your brand can say to move consumers closer. This does not mean retweets and likes--the fool's gold of social media marketing--but rather changes in consumer attitude or behavior such as greater awareness, consideration and purchase intent.

The second circle in the Venn diagram is what consumers want to hear from your brand. For years, we have acted as if consumers crave branded content, but the data on this clear; a 2014 Kentico study found that 68% of US consumers “mostly” or “always” ignore brand posts on every social network. The situation is much worse for some categories than others--a 2014 Scratch/Viacom study found that 71% of Millennials would rather go to the dentist than listen to what their banks are saying! If people would rather get a cavity filled than listen to your brand, it's a good bet your content and social media marketing faces a profound uphill challenge.

Where Social Media Marketing Works

Some brands have an overlap between these two circles of the Earned Media Venn Diagram; most do not. There are three types of companies that have this "magic intersection" between content that helps the brand and that consumers want:
  • Brands in select verticals:  Some categories have built-in consumer interest. For example, sports brands can easily post content that drives engagement and also increases demand for team attire and products. TV shows and movies have an easy time offering content fans will share that also increases ratings and box office receipts. Style brands are another example--in the same way that women eagerly purchase the September issue of Vogue with its 631(!) pages of ads, so too will style-conscious women pay attention to and share the latest pins and posts from their favorite fashion brands. Brands in select verticals enjoy a magic intersection between the content consumers want and the content that drives consideration and sales.
  • Brands with purpose:  Consumers may have little interest in what banks have to say, but that does not stop USAA from delivering great engagement and inbound traffic with its posts. This is because USAA has created a brand with a purpose that resonates with its audience. Another example is Chipotle, which has outperformed other brands in the restaurant industry by promoting its commitment to more locally- and organically-sourced ingredients. (Just last quarter, Chipotle delivered a same-store sales increase of 17% in a vertical where almost no brands are able to achieve half that.)
  • Brands with better products and services:  Of course, there is always the old-fashioned way of encouraging attention from consumers: Be better than the competition! Apple has no official company profile on either Facebook or Twitter, yet it still beats Samsung when it comes to building buzz. Both companies had product unveilings in early September (Samsung for the new Note and Apple for the iPhone 6), yet despite the fact Samsung has 2,350% more fans, followers and subscribers on Facebook, Twitter and YouTube, Apple still delivered far more Word of Mouth about their event and product. Apple does not need social profiles and content to drive WOM; it just needs to continue producing interesting, innovative products that get fans talking.
When brands have nothing to say: Example
of a brand exploiting a personal tragedy
to build its own brand engagement. 
Some companies can publish content that consumers want and delivers on marketing goals, but most brands simply do not have that same opportunity--they have no "magic intersection." This does not stop them from trying, of course, which is why so many brands stumble with unwelcome, heavy-handed, embarrassing, brand-damaging posts on Facebook and Twitter

We entered the social media era suggesting that brands with something to say could use social media to say it; instead, we today have brands with little to say that nonetheless post 4.3 times per day because some consultant told them this was a best practice. Desperate for attention and relevance, these companies continue to invest in content that is delivering neither the scale marketers need nor the content consumers want.

Ironically, even for the best companies, earned media may wither and die in the coming years. In just six months, organic reach on Facebook was halved, and many expect that zero organic reach will soon be the rule on the social network that collects 57% of all social visits. The organic reach game has gotten so tough that Coca-Cola, one of the strongest brands in the world, only earns engagement with 1 in 100,000 of its fans on Facebook. The situation on Twitter is no better; a recent Forrester report notes that the average engagement rate with brand posts on Twitter is just 0.03%--75% less than banner ad clickthough rates today!

Earned media could soon be a thing of the past. What happens to your social media marketing strategies if the content you create and post reaches no one?

A sketch made by Jennifer Torres during my presentation
at the PR + Social Media Summit. 

Social Media Marketing's Inability to Deliver Trust, Acquisition or Purchase Conversions

If the prospect of organic reach crumbling to nothing is not enough to worry about, social media marketing has a variety of other problems that marketers have been ignoring: 

If social media is so poorly equipped to deliver trust, traffic, acquisition and purchases--and is facing declining organic reach--why are marketers increasing their investment in the channel? These are, after all, the metrics that most marketers care about. In a 2013 study by Ascend2, both B2B and B2C marketers reported their top three most common performance metrics are website traffic, quantity of sales leads and conversions--goals against which social media does not deliver. Meanwhile, fewer than half of B2B and B2C marketers measure customer retention, awareness or reputation, which are metrics that align well to social media strategy.

But if social media is poorly matched to Marketing Department objectives, it remains a powerful opportunity for others in the enterprise who do not need to rely on reach and scale to deliver on their goals.  For example, The PR/Corporate Communications function can be successful if it uses social media to create relationships with a few dozen influencers, both traditional ones (journalists) and the new variety (bloggers). Product Development does not need to collaborate with tens of thousands of customers but can work collaboratively to develop new products and services with much smaller subsets of customers and vendors. And Customer Care can achieve success by answering the questions and complaints of a few hundred people in social channels. (Compare that to the average marketing campaign, which would be considered a dismal failure if it only engaged a few hundred people.)

Social Media Marketing on a Collision Course with C-Suite Expectations

For now, CMOs seem to have confidence in social media, but I believe this will change in the next year or two. Social media and content marketing is on a collision course with the C suite.

Recent research by the Fournaise Marketing Group, which was conducted with 1200 CEOs and CMOs, found that 80% of CEOs claim they have lost trust in their marketers. One of the reasons is that "74% of CEOs think Marketers focus too much on the latest marketing trends such as social media – but can rarely demonstrate how these trends will help them generate more business for the company."

This criticism is, sadly, entirely fair. In just-released data from the 2014 CMO Survey, derived from 351 top US marketers, a mere 15% of CMOs say they have proven the impact of social media quantitatively. Another 40% "have a good qualitative sense of the impact, but not a quantitative impact" and a whopping 45% have "not been able to show the impact yet." Despite this, CMOs expect to increase social media marketing spending 128% in the next five years. 

If you wonder why the tenure of CMOs is so short compared to the rest of the C-suite, the answer is right there. Less than one in six CMOs know if their social media investments are paying off, yet they still intend to rapidly double that investment!

I predict that increase will not happen. The falling organic reach, low acquisition, microscopic purchase conversion and inability to measure quantitative success will come crashing headlong into the growing pressure on the Marketing Department to demonstrate results. When this collision occurs, will you be the one holding the social media marketing bag? If your career depends on the success of social media or content marketing, now is the time to consider the data, trends and future.

How to Protect Your Social Media Marketing Career

For those in the social media marketing profession, I believe the time has come for a candid assessment. Protect your career by asking three questions:
  • Does your brand have a "magic intersection"? Are you in one of those categories--such as entertainment, sports and style--that has built-in consumer demand for branded content? Or has your company won high levels of loyalty and advocacy with its sense of purpose or by producing products and services that are leaps and bounds better than your competitors? If so, then social media marketing can be an effective channel for the Marketing Department, but if not, then ask...
  • Does your firm evaluate its Marketing spend based on reputation and loyalty? When marketing leaders furnish updates, do they lead with Net Promoter Score and measures of repurchase and reputation? Or do they lead with sales, conversions, acquisition and traffic data?  If the former, then social is well aligned to what the organization most cares about, but if it is the latter, then ask one last question....
  • Can you control the paid media budget for social? If you can control the ad budget and are really held more accountable for delivering paid media than earned media, then your job is secure (provided you are doing it well). If, however, the ad budget is controlled elsewhere and your job is dedicated solely to content and earned media, I would suggest you have career challenges ahead. It may time to consider one of three options:
    • Redirect: If your social media scorecard is full of non-marketing metrics such as likes, retweets and number of fans, then the time has come for you to lead a change. Do not wait until Marketing leadership begins to question how those useless social metrics tie to Marketing objectives; take the lead and start that conversation today. You may be able to change the conversation and redirect expectations toward the sorts of metrics on which social can realistically deliver.
    • Detour: It may be time to consider social media opportunities outside of the Marketing Department. While social may not deliver on typical marketing goals, it certainly aligns well to the needs and expectations of Public Relations, Customer Care, Product Development, Sales and others parts of the organization.
    • Exit: Or perhaps it is time to exit social media altogether and consider other career paths where your experience in customer-centricity and innovation can be of great value. In recent years, I have seen social media professionals successfully shift into new careers in Customer Experience, mobile and customer care, for example.

Of course, if your career is in social media marketing, you could choose the fourth option and bury your head into the sand. I hope you will not, because the data is consistent, the trends are in place and the questions about social media marketing effectiveness are only going to rise.

Below is my deck. I welcome your feedback, questions and challenges. 

Wednesday, October 1, 2014

RelayRides Growing, Evolving in Nascent Collaborative Transportation Category

The idea of borrowing a strangers’ car or taking a ride with an unfamiliar person would have seemed unimaginable just a few years ago. Today, many of us are doing this regularly via collaborative economy transportation services such as Zipcar, Uber, Lyft, Sidecar and RelayRides.

I have plenty of experience as a consumer of this new category of service, but I wanted to get a view from the inside of one of these companies. I had the chance to do an email interview with Steve Webb, Director of Community and Communications at RelayRides, and we covered topics ranging from rising competition to differentiation to risk protection to the future of car- and ride-sharing.

RelayRides is a bit like Zipcar but differs in a couple of key ways. Unlike Zipcar, RelayRides is not just a collective consumption model but is truly peer-to-peer. While Zipcar rents its own cars, RelayRides connects people who own cars with those who need transportation. Car owners can earn a bit of money from their automobile during periods it is idle, and those without cars can get access to their neighbors’ vehicles.

Another way RelayRides differs from Zipcar is that, although the company started as a competitor to Zipcar’s rent-by-the-hour business, RelayRides tweaked its business model last year to offer daily rather than hourly rentals. As a result, the company is now focusing more on airport rentals, where people arriving on trips may make arrangements to meet someone who is making their car available to rent. In San Francisco, RelayRides even operates its own parking lot where local residents may leave their car as they depart so that arriving travelers can rent it, thus saving car owners from parking fees and converting their unused car into cash.

The competition is heating up among transportation companies in the peer-to-peer economy. This is quite evident, as Uber and Lyft snipe at each other about unethical business practices and San Francisco reports the number of taxi rides has plummeted 65% in just 15 months.

In this crowded space, RelayRides competes by being “the only nationwide peer-to-peer car rental marketplace,” says Webb. “We are in 2,300 cities nationwide, including every major metro area besides NYC--we had to halt business there because of certain unique aspects of NY State insurance law.”  In one of many legal challenges to the P2P car- and ride-sharing industry, New York’s Department of Financial Services demanded that RelayRides suspend operations in the state until the company submits a business plan to the DFS that is consistent with state law.

RelayRides is striving to compete with others by making trust and safety a focus.  “If our members are not completely safe and protected, our marketplace doesn't work,” notes Webb. “This is why from the very beginning we have provided members with a $1 million insurance policy. Additionally, we have put great emphasis on pre-screening drivers to ensure only the best drivers are on the marketplace."

As with others in this space, RelayRides is growing.  “We have grown from being in just two cities and zero airports in 2012 to being in 2,300 cities and 300 airports this year.”  Its biggest challenge right now is awareness, notes Webb; “We will continue to raise awareness about the marketplace and continue to work on increasing customer delight.”

The benefits to car owners are evident, but I was surprised to hear how much money RelayRide owners are making. “Our average owner earned $360 last month, “ says Webb. He adds that renters are also enjoying benefits: “The average renter saves 35 percent versus traditional rental companies”

RelayRides is also proud of the benefits the company is bringing to the environment. According to Web, “We are helping to reduce people's carbon footprint--each shared car takes 13 off of the road, encourages more biking, walking and use of public transportation." The company recently produced an infographic to spread the word on RelayRide’s positive impact on the planet (see below).

The future will bring many changes, challenging traditional auto manufacturing and sales and changing the collaborative transportation market.  I speculate that self-driving cars may undermine many transportation companies in the decade or two to come, but Webb feels “It is impossible to speculate what these technologies changes will bring.” Whatever happens, Webb says that RelayRides “looks forward to innovation and feel strongly positioned to evolve with technology.”

Friday, August 22, 2014

What Marketers CANNOT Learn From The #IceBucketChallenge

Credit: slgckgc via photopin cc
I love internet memes, but I hate the way each one gets turned into fodder for advertising publications and agency bloggers to (try to) turn the event into a "teachable moment" for marketers. While a trend is hot, news sites and agencies strive to build more attention and traffic with a form of newsjacking, leveraging interest in a trending topic to create attention for themselves. Right now, this is happening with the Ice Bucket Challenge, with dozens of news, blog and LinkedIn posts telling marketers what they can learn from this meme. I do not agree with much of what has been written, so at risk of engaging in newsjacking myself, I am going to write about this program and hope that it encourages more dialog and consideration about this craze and what it may or may not mean for marketers.

Sometimes, a meme can furnish a few lessons that marketers might consider when developing their marketing strategies. At other times, the connection between the event and brands is tenuous, at best. And on occasion, the effort to turn current events into something relevant for brands and marketers blows back.

Many recently criticized PR agency Edelman for publishing a blog post immediately after Robin Williams' suicide suggesting brands "Seize the day" and use the tragedy "as an opportunity to engage in a national conversation." While the Edelman blog post was worthy of criticism, it was really just a symptom of a larger issue: Marketers' and agencies' continued promotion and use of dubious tactics such as "real-time marketing" and "brand newsrooms." These schemes attempt to hijack consumer emotion and interest in a current event to make otherwise irrelevant brands more relevant.

Business leaders must recognize that companies build relevance not by hopping from one trending topic to another but with concerted and ongoing effort in specific and discrete issues that resonate with consumers. Edelman should know--better than most--that the time for a company to demonstrate care for depression and suicide is before a celebrity death brings these topics to the forefront and not after Twitter is abuzz. One way tells consumers that your organization stands for something more than profits; the other tells consumers your brand is a vulture willing to exploit any tragedy or event to try to boost the bottom line.

It is happening again--while the world is busy dumping buckets of ice water over their heads, ad industry news sites and agency blogs are lighting up with posts about what marketers can learn from the #IceBucketChallenge. Alas, I believe many of these posts and articles are simply wrong, drawing arguable connections between what worked for this charitable effort and what will work for brands. Here is what I believe marketers can (and cannot) take from the success of the Ice Bucket Challenge:

  • The #IceBucketChallenge demonstrates the power of social media, not the power of social media marketing. (Tweet This): Almost every article and blog post I have read calls this a "campaign." It is not. A campaign is a planned series of marketing events launched by an organization to achieve a goal, but the ALS Association did not plan, launch or manage this (although they have eagerly jumped on the bandwagon). The Ice Bucket Challenge was a spontaneous and viral happening created and spread by individuals; in fact, had the ALS Association attempted to launch this themselves, they likely would have been criticized for manipulating and asking too much of people. The Ice Bucket Challenge succeeded not because it was a carefully crafted campaign but because it wasn't.
  • The Ice Bucket Challenge didn't succeed because it is easy but because it is difficult. I have read several times that brands can learn from this program that making participation easy for consumers is vital. Excuse me--the Ice Bucket Challenge was easy?! Most brands would do backflips simply to get 15 seconds of consumers' time to post a rating or positive comment. Meanwhile, the Ice Bucket Challenge required people to find a bucket, fill it, lug the heavy bucket somewhere convenient, fill it with ice, set up a smartphone to capture everything, lift the heavy bucket, douse themselves in ice-cold water, dry off, change clothes and post the video online. And, oh yeah, donate money! If that is your idea of easy, I wonder what a difficult activity might be!

    Ironically, had the challenge been something easy--"I dare you to post a video doing a duck face!," for example--it would not have worked. Because the Ice Bucket Challenge was difficult, it gave people an opportunity to demonstrate their willingness to make the effort--and no, your brand probably cannot get people to do heroic activities in support of your product or service. 
  • Credit: gwen via photopin cc
    The Ice Bucket Challenge was not a program about caring but about pride and shame. Before you react negatively to me calling out ego and humiliation as drivers, let me point out that this is not a criticism. The program succeeded, and there is nothing wrong with a charity with using the human emotions of pride and shame to achieve a positive end; after all, those are exactly the same mechanics that work in many charitable programs. Take, for example, the VFW fundraising program where volunteers stand with cash buckets in front of store entryways and give away little flowers to those who donate. If you cough up cash, you get a Buddy Poppy to wear around that day, showing pride in your small sacrifice; but if you make eye contact and walk past without donating, you feel shame. (You know you do!)

    The fact that people could show off how creative they were (with Bill Gates building a dousing contraption and Stephanie Izard doing an ice bucket Flashdance) was a big part of the success of the Ice Bucket Challenge. So was the part of the program that demanded people call others out by name; this was the charitable equivalent of a chain email, but because of the social media elements, people could not break the chain privately and quietly but only by humiliating themselves with silence and inaction. While some have claimed this program was about pulling at the heartstrings, I can recall seeing just one video that was legitimately emotional. The lesson of the Ice Bucket Challenge is that pride and shame are powerful human emotions, but brands should be very wary of trying to activate these emotions as part of a for-profit marketing campaign. 
  • Lou Gehrig's farewell speech, when he declares himself the
    "luckiest man on the face of the earth," moves me to tears.
    The Ice Bucket Challenge was not successful as a cohesive marketing effort, but it was a great first step. As I write this, the ALS Association has received $41 million of donations thanks to the Ice Bucket Challenge, more than double what the organization raised in its last fiscal year. But while this clearly had a terrific fundraising impact in 2014, will it build future success for the ALS Association?  For example, I would suggest the Ice Bucket Challenge did little to raise awareness. Most people had heard of Lou Gehrig's Disease before the Ice Bucket Challenge, and afterwards, how many of the participants would be able to identify its symptoms, when it strikes, its prevalence or anything else about ALS? Very few of the Ice Bucket videos made even passing reference to ALS, and without awareness and knowledge, this one-time event cannot be turned into a lasting driver of success in the fight against ALS.

    Of course, the ALS Association now has the names and contact data for more than 700,000 new donors. If the charity fails to educate those individuals, few will donate again and the association will not build upon this success for future fundraising benefit. With additional concerted effort, the ALS Association may convert this successful acquisition program into an effective awareness, loyalty and repeat donation effort. The point that marketers should take from this is that no single campaign or program can be a soup-to-nuts success delivering on every marketing goal; instead, building deep, strong, and long-lasting consumer relationships takes a cohesive brand journey. 

It takes nothing away from the generosity of many or the rewards accruing to the ALS Association to point out that this was not an effective marketing program but another example of the way social media lightning can strike unexpectedly. This is what brands can learn: Consumers are fickle and crowds are hard to predict or motivate. They can ignore your carefully-crafted and expensive viral video campaign then turn around and make the Harlem Shake the next big thing. 

Kudos to the ALS Association for seeing the Ice Bucket Challenge rising out of the crowd and being agile enough to capitalize on the opportunity. In the end, that may be the most important message of all for brands--your brand succeeds not with what you plan and post but with what consumers think and do. If brands did more worth talking about and concentrated less on broadcasting content, they would have a better chance of building relevance and loyalty in the social media era. 

Friday, August 15, 2014

New York Times Admits Its Native Advertising Violates FTC Rules

Photo Credit: Me!
Two weeks ago, John Oliver's bit on Native Advertising went viral--at least in marketing circles--but it was hardly the most disturbing thing to be published that week on the alarming and growing practice of sponsored content in mainstream media. While I enjoyed the humorous (and accurate) critique on Oliver's "Last Week Tonight," AdAge.com featured an even more troublesome item, entitled "New York Times Tones Down Labeling on Its Sponsored Posts."

The New York Times, long considered a U.S. national "newspaper of record" due to its professional ethics and reporting standards, has decided to appease advertisers desperate to bypass consumers' natural aversion and avoidance of advertising. The newspaper "shrunk the labels that distinguish articles bought by advertisers from articles generated in its newsroom and made the language in the labels less explicit."

What is so disappointing about The New York Times' action is that studies demonstrate a substantial level of confusion on the part of consumers about sponsored content. Consumers do not recognize Native Advertising as paid media, nor do they understand what "promoted content" means:
  • The IAB published a study last month that found business and entertainment news audiences could generally identify sponsored content, but "the general news audience had more trouble, with less than half (41%) recognizing that the material was advertising."
  • A 2013 study by David Franklyn, law professor at the University of San Francisco, found that people “didn’t remember seeing ‘sponsored by’ posts when asked to read a web page and the majority (over 50 percent) also didn't know what the word ‘sponsored’ actually meant.”
  • A recent study by Contently found that "while a plurality (48 percent) of respondents believe that 'Sponsored Content' means that an advertiser paid for the article to be created and had influence on the article’s content, more than half (52 percent) thought it meant something different." The study further found that:
    • Two-thirds of readers have felt deceived upon realizing that an article or video was sponsored by a brand.
    • 54 percent of readers don’t trust sponsored content.
    • 59 percent of readers believe a news site loses credibility if it runs articles sponsored by a brand.
    • Every single age group would prefer news sites stick to banner ads versus sponsored content. (This may be the first study in history to find a preference for banner ads, which makes evident consumers' perspective on Native Advertising.)
Advertising ethics and Federal Trade Commission (FTC) disclosure rules demand more disclosure, not less. The FTC does not set standards for disclosures but determines the effectiveness and legitimacy of the disclosure based on whether or not it succeeds in informing consumers. Simply put, if consumers cannot distinguish that content is sponsored nor understand what the disclosure means, it is illegal under the FTC Act, which prohibits "unfair or deceptive acts or practices."

This is made explicit in the FTC's ".com Disclosure" guide, which the agency created to help marketers and media outlets understand the law in the digital world. It states, "The ultimate test is not the size of the font or the location of the disclosure, although they are important considerations; the ultimate test is whether the information intended to be disclosed is actually conveyed to consumers." Today's Native Advertising undeniably fails to meet this standard (and it is a shame the FTC is burying its head in the sand rather than enforcing the rules it has established.) 

While it is sufficiently disturbing that The New York Times would diminish disclosures to make them less "clear and conspicuous," it was this line in the Ad Age article that left me dumbfounded:
"Several marketers have bristled at all the labeling, suggesting it turned away readers before they had a chance to judge the content based on its quality."
If this were a legal drama, that statement would cause the courtroom to erupt as the judge bangs his gavel demanding "Order in the court." That sentence is is an admission of guilt; a confession that The New York Times is violating both FTC guidance and advertising ethics.

The entire point of the FTC's "clear and conspicuous" disclosure rules is to ensure consumers recognize content as sponsored before engaging with it so that they can make an informed decision to read, watch or listen to the brand-sponsored media. In the old days of printed "advertorials," those fake "articles" were surrounded by a special border with the word "advertisement" repeated so as to provide a clear and conspicuous disclosure to consumers before they began to read the ad. On television, the FTC requires infomercials to "clearly disclose that 'THE PROGRAM YOU ARE WATCHING IS A PAID ADVERTISEMENT FOR [NAME OF PRODUCT]' at the beginning of an infomercial." (The italics are mine, but the capitalization is the FTC's.) 

The admission that The New York Times and its advertisers are actively attempting to deceive consumers into engaging with paid content before disclosing it is sponsored content is startling. It is also upsetting, because this demonstrates the wholesale failure of the news industry, marketers and regulators to uphold well-established, long-standing ethical advertising guidelines.

Some may argue I am overreacting--that Native Advertising can be done legally and ethically. I agree it can--with clear and conspicuous disclosure that plainly informs consumers the content is paid media. If the readers choose to proceed after seeing and understanding the disclosure, everybody wins! But absent that level of disclosure, Native Advertising is dangerous for all parties. It undermines the trustworthiness and independence of the news media; causes brands to look deceptive, untrustworthy, desperate and disrespectful of customers; deceives consumers who may not realize the content is influenced or written by a brand; and makes the FTC look toothless and opens the door to further violations of its rules.

To appreciate the potential damage caused by Native Advertising, put yourself not in the shoes of a marketer with sales or market share goals to deliver; instead, consider this from the perspective of a parent, spouse or customer. We can forgive David Ogilvy for a bit of sexism given the era in which he said it, but his famous admonition to advertisers demands we see our practices from both sides: "The consumer is not an idiot. She is your wife." How would you feel if a "respectable" news site buried a disclosure and encouraged you or your family to read:
  • "The Five TV shows You Can't Miss This Season" (sponsored by a production company that only included its own shows)
  • "Danger: Eating Tainted Chicken Sickens Children" (sponsored by the beef industry)
  • "Researchers: Fracking Completely Safe for Environment" (sponsored by a petroleum lobbying group)
  • "US Falls Behind As Regulation Stifles American Competitiveness" (sponsored by a bank trying to get Washington to loosen banking regulations)
  • "Human Rights Abuses Mount in Fill-In-The-Blank-Country" (sponsored by a top Pentagon contractor that will make billions if the US intervenes with military action) 
"First NYTimes frontpage (1851-9-18)"
 by The New York Times - ProQuest
Database. Licensed under Public
domain via Wikimedia Commons.
Native Advertising (without clear and conspicuous disclosure) is not a slippery slope; it is a single step onto a banana peel. I certainly understand the appeal of this new form of advertising to The New York Times, whose stock has declined 70% in the last decade (while the Dow has risen an equal percentage); nevertheless, the future of the Times (and of news, in general) is not improved by violating FTC rules, undermining trust and raising suspicions in consumers' minds that what they read was written by the highest bidder.

The current leadership of The New York Times would be wise to head the message that was printed in its inaugural issue in 1851:
We shall be "Conservative", in all cases where we think Conservatism essential to the public good;—and we shall be Radical in everything which may seem to us to require radical treatment and radical reform. We do not believe that "everything" in Society is either exactly right or exactly wrong;—what is good we desire to preserve and improve;—what is evil, to exterminate, or reform.
It is hard to imagine how obfuscating paid media is in the "public good." In fact, actively minimizing disclosures to deceive readers is clearly evil, and the Times' leaders would be well advised--not just for ethical reasons but for its own future--to "exterminate" or "reform" its Native Advertising practices.