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Thursday, February 25, 2010

Is Social Media the Answer?

The world is buzzing with talk of Social Media. Everyone seems to want to bake it into their communications campaigns and many feel that it will be the dominant selling vehicle in the years to come. Ad pros under 35 shake their heads in bemusement if the affable older fellow in the room with the tie and cufflinks (that would be Mr. Cole) suggests that it might not comprise one stop shopping a few years from now. Here are some of my thoughts on social media and, as promised earlier, there will be several more commentaries on the topic over the next year.

Social media is simply user or consumer-generated content. It allows companies to interact with customers and also serves as a platform for people to engage in networking or communication across the world. It comes in many forms most famously Facebook, Twitter, the fading MySpace, Internet Forums, Blogs, Wikis, Podcasts and Microblogging.

Virtually all of us are engaged in Social Media. If you are reading this blog, you are part of it. So, to test the hype, I took my own small, highly unscientific poll of businesses to see what people thought.

Roughly 30% said it moved sales and was so valuable that everyone should be using it. Some said that they could not separate its impact from other advertising and promotional activity. A larger group dismissed it as a waste of time and money and used language that I will not share with you to define the bad experience.

But something is definitely happening out there. You see a mass of bewildering and sometimes inaccurate facts to profile Social Media. But no other medium has reached hundreds of millions of people in such a short of time as Social Media—maybe 9 months? Small company success stories are remarkable when you see people with $10,000-20,000 budgets do nothing else and watch sales jump and inquiries arrive on line from more than 25 countries. Other changes are afoot. My dear school, Boston College,reputedly stopped giving incoming freshman their own e-mail this past year as everyone appeared to have a Facebook page.

Small businesses seem to love it. Dan Simons, a Washington restaurateur, said “Social Media for business is now life or death.” He constantly monitors on line forums, local review sites and thinks that customers sharing their opinions are re-shaping the environment for small business. Adults under 30 repeatedly tell me that they use reviews on the Facebook pages of friends to choose restaurants or current movies. My university students echo that sentiment as well.

Sound too good to be true? Well, that is where is the crusty curmudgeon in me begins to surface. I can see how Social Media can make or break a bistro and the word of mouth it generates can elevate a film’s audience. But, I am a little more skeptical about package goods, for example, across the board.

The Social Media gurus all mouth lines such as the following:

1) Whatever you do, don’t focus on your consumers—engage them!
2) Don’t create a product; rather, create a consumer experience.
3) A brand is not a promise; it is a relationship.
4) Never sell to people, especially young adults—establish a rapport and have two way communications with them.

Some of these comments have elements of truth but give me a break! If I am selling DRANO, do I need to engage someway first via two way communications? I think some of these gurus need DRANO for their clogged minds.

What is going on? One theory that has been stewing in its own juices with me for some time is that smart people of all ages in the business realize that TV is in trouble. It is not as effective as it was several years ago. But, it is still very effective. Too many desire a simple answer to a complex problem. If 15 years ago, you could run some TV spots, have a few nice magazine ads, and drop some coupons, your product could get some traction. Now, it is trickier. You have to look at a few dozen things. Many of the new wave things that you tried from simple internet banners and buttons to early mobile tests failed. So, you are looking for a new silver bullet that will work like television used to for so many of us for so long.

Well, Social Media is not going to be that silver bullet. I am betting that there will be never be another medium like TV. Media teams several years from now will have to look at 50 things and the labor intensity for an ad agency to do the job ethically and well will be enormous. Clients will blink at the requests for sharply increased media planning fees but that will be the stuff of truly sound execution. The mantra will be test, test, never rest as our global merry go round develops and evolves.

So, I stress that I like, even love Social Media and enjoy being a part of it. But, it is not going to be the single or dominant solution that many seem to think it will be for any company or brand of size.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

Thursday, February 18, 2010

Misleading Super Bowl Statistics

To those of us who are friendly with and admire beleaguered broadcasters, the strength of the 2010 Super Bowl Nielsen performance was most welcome. According to Nielsen, the game delivered a 46.4 household rating and a 68 share. The 106 million viewers was a U.S. record for an individual telecast.

Since then, the press has picked up on the strength and done some stunningly bad reporting. Also, some media researchers who definitely know better have apparently deliberately distorted the performance.

Here is my beef: There is no question that this Super Bowl reached more people than any other U.S. telecast in history. And, the Doritos spot was the most viewed commercial ever for a one time event. But, creeping in to interviews are comments such as “this is the highest rated program ever.” These people are media researchers or media reporters. They damn well know what the term rating means.

A rating is the percentage of the total household base or specific demographic that is tuned in to a specific program. By that definition, the real one, as strong as this Super Bowl was, it is not anywhere close to the highest rated show in U.S. television history.

It approached the final episode of “Roots” which delivered a 51.1 rating on January 30, 1977. And, it is compared the most to the final episode of MASH, which delivered a 60.2 rating and 77 share way back in 1983. But in 1983, we had a TV household base of 83.3 million. Today, it is 115 million TV households. So, while the Super Bowl delivered more viewers than MASH, and passed the MASH finale as the most viewed program, it was not higher rated by a long shot. It benefited mightily from a household base that has grown 38% since 1983.

Some of you wrote to me asking for comments about the commercials in the game. It was an okay year. I liked the Betty White Snickers spot and the Doritos park bench commercial. Why did several spots feature men with no pants? Perhaps there was a lack of true creativity going on. Also, the hype around the Google spot surprised me. I thought that I had seen it a few months ago on two of my favorite venues—Hulu.com and You Tube. Actually, they added 8 seconds and a new musical bed creating a :60 that gave it a gigantic audience for the big game. But some of us, arguably without lives, saw it or something close to it some time ago.

Finally, I tried to find out what was truly the highest rated TV show of all time. Several claimants are out there but the one that intrigued me the most was the Ed Sullivan Show on September 9, 1956. It was Elvis Presley’s first appearance on that show. I was only a little fellow but I remember it vividly and especially my father’s reaction. Some accounts say that the bumbling Ed Sullivan did not introduce Elvis but rather it was Academy Award winning British actor Charles Laughton. That had to be surreal. The account of early Nielsen data that I found said that Elvis delivered an 82.6 rating that night. If it is true it only goes to underscore that while nearly 54 years have passed, Elvis remains the King.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

Monday, February 8, 2010

Nobody Knows Anything

William Goldman is a marvelously gifted screenwriter. He copped Oscars for his original screenplay of “Butch Cassidy and the Sundance Kid” and for his adaptation to the screen of Woodward and Bernstein’s “All the President’s Men.” A number of years ago when summing up the entire entertainment industry he wrote “Nobody knows anything.” People took this as an indictment of all Hollywood moguls but he said his real point was that Hollywood has no real idea of how well a film will do.

“Rocky” was a low budget film that captured America’s imagination although film buffs said the editing was so bad that it looked as if it had been cut in a butcher shop. Yet, it won the Oscar for Best Picture. Our world will have similar surprises in the years to come.

Forecasting is tough yet there is no shortage of pundits out there who speak ex cathedra on just about any topic. Ever watch CNBC? I confess that I love it. The problem is that guests who should know better will predict the movement of the Dow Jones Industrial Average for the next week or even the next day. No one really knows. The great John Bogle took the opposite approach. Noting that most financial advisers cannot beat the market consistently, he created index funds with unusually low fees that simply mirror the market or a segment as a whole. One never does better than the market but never does worse and you tend to do well over long periods as high fees do not weigh down returns. Most of us, however, still think that we can forecast.

Taking some newsletters that I subscribe to and reading the latest books on energy, consumer behavior and the financial crisis, I cobbled together the following wildly hypothetical forecast:

“It is February, 2016. In Milwaukee, an 85 year old widow sits shivering in her small apartment. Her heating bill now exceeds the $925 Social Security payment that she receives each month and is the bulk of her income. She has to decide between heat, rent, prescription drugs, and food. Before the winter is out, several thousand Americans in similar situations will die horrible deaths.

“We finally hit the end of the 65 year period of continuing credit expansion in the U.S. It was largely based on using the U.S. dollar as the reserve currency. By 2014, the rest of the world became increasingly unwilling to accumulate dollars as our budget and trade deficits ran up trillion after trillion with no end in sight. Oil was no longer quoted in dollars and interest rates shot up quickly making our budget deficit far more acute. Finally, a new reserve currency emerges that is a basket containing the Chinese Yuan, Canadian and Australian dollars, Swiss Franc, and gold. The DJIA does not do much year to year but the volatility is wild and keeps the everyman “Peter Panics” from the market.

“India and China were doing fairly well and they and other developing nations bid up the price of gasoline to about $5 a gallon at the pump. The industry could not simply replace oil reserves fast enough. The American middle class was shattered as some could no longer afford to drive to work. Used car lots were bloated with gas guzzlers that most were reluctant to drive or unable to afford anymore.

“Newspapers and magazines folded by the hundreds and people stubbornly did not wish to pay for online content. So, the spiral continued as online versions died. The trend grew worse and worse.

“TV stations had a much looser relationship with their struggling networks. The networks produced fewer hours of programming and locally stations often killed their local news and ran syndicated versions of “2 and ½ Men” and other past network fare. The tight economy prompted many consumers to drop satellite and cable grimly held its own although it too suffered some subscription losses. The internet continued to grow as an advertising medium and Social Media gained nicely each year especially for well known brands as well as small, local retailers with affluent niche audiences.

“Some radio groups could not handle their debt service and went under. A few local players swooped in and bought properties for 25 cents on the dollar. They were not coining money but they had viable businesses with strong local community involvement. You Tube’s webisodes gained traction especially with young adults who loved the 5-7 minute series episodes that they could watch whenever they wished with only one commercial as a lead in.

“Stations and network players were excited about the 2016 elections and the record shattering amount of advertising revenues for the fall, although the campaigns were dirtier than any in memory. Some were embarrassed by the commercial content of many candidates but legally they had to take it and they really needed the money.”

Is this possible? After all, it is nothing more than a shrewd assemblage of today’s headlines with some friendly exaggeration piled on. And, it is not dissimilar to forecasts mailed to me by readers or seen in newsletters that I subscribe to or people send me.

The answer is almost surely NO. Some of the above will likely happen but in softer terms than what I imagined above. People are resilient and will adapt although some pain appears inevitable.

The only certainty that I ever take to the bank in business is DEMOGRAPHIC CERTAINTY. For example, I am one of the early baby boomers. More children were born between 1948 and 1953 than in the previous 30 years. By 2016, this group will largely be drawing Social Security and many will be on Medicare. They will put an incredible strain on government expenditures and they will be contributing far less toward taxes than they do now. Demographics are an unstoppable tidal wave. The only way to tame, not cure these entitlements is to raise taxes and/or cut benefits. Understandably, politicians loathe to do that as some seniors are virtually helpless and all too many of us soon to be geezers will vote and, usually, our pocketbooks.

So, panic is not a good idea. My advice is stay optimistic (but be realistic),be current with industry trends, flexible, and realize that anything can happen and often does. Humility, an oft forgotten virtue, will likely serve us all very well over the next several years if we embrace it. If 15 years ago, anyone explained Google to you, you would say that he or she was crazy. Social media? You have got to be kidding! Network TV erosion? Of course, but not so much! So, similar surprises will hit the media world and the United States of America.

Management guru Peter Drucker, who died a few years ago at 95, said in his old age, “The only thing that I know about the future is that it will be different.” I consider those wise and timely words from one of our most astute observers.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com