Social Measurement

On the bell curve of social strategy adoption, there are the early adopters and those that want so much proof of a roadmap of success they will forever being playing catch up to their competitors. If you are one of these companies, I ask you to answer this question. Do you know what every customer is worth to you over their lifespan? I am guessing the answer is no. Even with customer loyalty programs and CRM systems, I am positive most rank and file employees do not know this number. 
In a case study in "I Love You More Than My Dog" by Jeanne Bliss, she highlights Zane's Cycles. They know that each customer is worth $12,500 over their life span of purchasing bicycles and associated products. (More in our case given my husband and I are avid cyclists) As a result, they are rabid about service. Ms. Bliss isn't the only one to notice this as Zane's is also a featured business in American Express' OPEN Forum. This is a community targeted at the small business owners with OPEN cards to interact with each other to share best practices. Getting noticed and having the over the top success is a wonderful achievement for Zane's. Let's be honest, they are located in Connecticut. Our winters are as conducive to year round cycling as say a shop in Texas.

If you want to know if a community is going to drive and product ROI, understand the worth of a community member (insert happy customer or valued customer). Also, by understanding what a well educated customer worth to you walking in the door, you can understand the importance of a welcoming and nurturing first impression is to your business. Your first impression is often what they see on the web. Think about how many times you "Google or Bing" a business prior to purchasing an item or walking in the door. A community for your customers discussing your business is a wonderful way to welcome existing and new customers looking to verify prior to trusting you with their hard earned capital.

Let's do some math. I am going to use some base line numbers. A new community is a first year investment of $75,000 - $100,000. An average customer spends $600 a year with you. This is $50 a month. (I drop that easily at a local nail salon.) This means a social community must produce an extra 175 customers to be profitable a year. How is that for an ROI number?


If you are a large enterprise, that is an easy number to commit to achieving. Say your average customer is worth $5,000 a year. That is only 20-25 customers you have to secure. A more realistic target is adding 100 more customers. That is ½ million in gross profit. Have I got your attention yet?


More math (sorry), add this to the number of community members that will increase their annual spend with you or not be as swayed by the competition because of the relationship and value you are expressing to them. Let's get scary… So your biggest competition deploys a robust uber friendly community and lures 200 customers away from you. What is that worth?


If you are looking for ROI, seek no further than the worth of one customer and divide it by the cost of deployment. It really is peanuts. I will ask it again... Do you know what every customer is worth to you over their lifespan?

Social Selection

Earlier this week, I attended a Gaspedal event in NYC on Word of Mouth Marketing (WOMMA) called "SuperGenius". I was looking forward to going.  Not only did they have a bang up list of speakers and facilitators, it is always great to network and perchance to under cover a new potential customer or two.   Ironically, I had started my prep for this about six months ago when I read one of the speaker's books, "I Love You More Than My Dog", by Jeanne Bliss.   I had pulled it out over the weekend to re-read some of the case studies ... especially those about Zappos.com as their CEO Tony Hsieh was also keynoting.  

This conference was suppose to be able how to get the word out about your company using "Word of Mouth" and specifically, social networking.   However, one of the key underlying themes was about hiring the right people and promoting the right culture.  Happy employees create a happy culture which will not go unnoticed by your customers.   Good service -> no EXEMPLARY SERVICE gets noticed.   Humans not technology solve other humans problems and heart break ... your employees hold your brand, your customer relationship, and can be the center of a solid WOM program. Social Networking applications and technology help facilitate human interaction.  Be careful as you hire... Be more careful to make sure your decisions impact in a positive way your employees. 

Case in Point:    While running errands on Saturday, I popped into a local pet food store, The Feed Barn that has several locations to pick up some cat food and Frontline.   While there, I over heard two employees that have been there quite awhile considering retail turnover about the owner installing web cams.   Given the economy, I thought they may be experiencing a theft problem.   I commented.   I was shocked to find out the webcams were being installed around their time clock because while one employee was helping out the last customer perhaps 15-18 minutes after closing, Another one was punching them all out ...  The owner thought this was because at 6:16 he had to pay them all another 15 minutes.    So ...   he has now not only lost the trust of his employees .. they have spread the word (although prompted by me) ...  I have told others and used it as an example of what not to do!  I also suggested the irony of the book by Jeanne "I Love You More than my Dog" and that they should buy it for him. One of the Five Principals discussed is "Decide to Believe". This starts with all your networks.  Customers, Employees, Suppliers... However, your employees are always at the core. 

Select people with your values.   Choose people passionate about success.   Happy employees radiate a glow and it shows with customers.   Be human.

Zappos actually will pay people to resign if it isn't the right fit for new employees.   No harm no foul... just don't pollute our culture with anything less than your complete joy in doing your job.   What companies (large or small) do you feel do a great job at this?  

Notes from Brannydoon....: Employer Branding – Alice’s view in the Reverse Looking Glass

Notes from Brannydoon....: Employer Branding – Alice’s view in the Reverse Looking Glass

Employer Branding – Alice’s view in the Reverse Looking Glass

So you are a smart recruiter or Human Resources person, right? You have all the tools and tricks to recruit and check out candidates on Linked In, Twitter, MySpace, and the social networking site de jour. You have a candidate fully vetted prior to picking up the phone for the first screen. Perhaps, you have already done confidential reference from a shared connection. BUT … Have you looked to see what candidates are seeing about you as an employer? What have your staffing decisions done to your employee brand? How will they affect your company's ability to hire quality talent? What if they did a reference on you with your former employees that held the same position?

My past experience in both social technology and recruiting leaves some very interesting stories at my door often. I am going to share one I learned about this week in my travels. I sat next to this woman on the train named Alice. We had a quick chat about the new movie "Alice in Wonderland" that I had seen and loved! In the hour long trip, we covered a variety of topics but after hearing about my professional background she shared the following story….

Alice had received an email from a stranger asking about their experience working a past company. This stranger had been contacted by a recruiter looking for him to explore leaving a solid job at solid company to seek out greener pastures. This candidate did his homework and found Alice on LinkedIn. The opportunity sounded exciting. Prior to risking his current job, he wanted inside information no recruiter or hiring manager was going to share. In the stranger's research, it was discovered a ton of people had worked in the same capacity as he was being asked to interview. All of the people had short tenures (averaging 6 months to two years). Bravely, this stranger started reaching out to these former employees to discover inquiry why? Alice was one of the individuals the stranger reached out to contact.

Alice told me about her mixed feelings about telling this stranger the truth. On the one hand, she had enjoyed working for the company. She had friends that still worked there. However, she wished she had been smart enough to push this fact herself. She had seen it prior to accepting the position. Alice had accepted their story and didn't double check the facts. The company in question had a history of hiring a new VP and people to do this task only to lay them all off within six months to year. Then in about another 6 months go through the hiring process and pay recruiters to do it all over again. This stranger deserved the benefit of the doubt she felt. Alice shared the following dialog with me:

Alice: I also looked at your LinkedIn profile. Are you still working at Company X?

Stranger: Yes, I am still employed there.

Alice: Are you happy?

Stranger: Yes, the only reason he was interested was the new skill set and potential larger to make an impact on this new company.

Alice:
(hmmm sounds familiar she said to herself) Is there any pressing reason you need to make a change? More potential earnings for College tuition, moving closer to family, a burning desire to live where the company was etc.

Stranger: No

Alice: Then why on God's green Earth are you even entertaining this interview given the information you believe to have uncovered? You know the phrase "Where there is smoke there is fire" Honestly, I would tell anyone regardless of the company this if they had asked me. In this economy, why would you ever risk the happiness you told me about? Want a new adventure….try rock climbing! Listen to your gut, man!

The Stranger thanked her for opening his eyes and confirming without bashing the company his suspicions. He would be canceling the interview.

Alice told me had some of the answers been different about his employment status or happiness or compensation she may have encouraged him to take the interview. Alice just couldn't let someone else make the same error in judgment that had left her in a financial crisis. The lay-off had forced her to have to give up her independence. at close to 30 years old, Alice had to move back in with her parents for six month while she found another job and got back on her feet. It had not only impacted her career, her independence but had done a number on her relationship with her family not to mention her self-esteem and finances. Why people open up to me about these things? I have no clue. I guess I have a trusting face.

Here is the morale for employers… Remember, your previous actions on hiring, lay-offs, and serial turnover will have a huge impact on your ability to hire the best talent out there given the ease of connection with social networking and search. What will they see when they load in "YOUR COMPANY NAME" "KEYWORD = POSITION TITLE" and select past employees in LinkedIn. Will they see a pattern of serial turnover? Remember, your brand isn't only the company's product or service. It is your people and the people that have worked for you. They also continue to be a conduit of your brand. What will candidates discover by referencing you? Every employer that has been around a while has previous employees with an axe to grind. I am not talking about this one off wild chance. It is the patterns you need to be aware of creating and the poor messaging you create with potential hires. I have seen this myself with companies I recruited for in the temporary staffing market.

Here is a possible solution… Create your own reference list. Have past employees your candidates can speak with that will provide a good reference. It won't prevent them from doing what this savvy stranger did but it may help.

Happy Recruiting Everyone!