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Ray Wang: Brands are dumb if they drive traffic to Facebook

28th May 2012
Share this content caught up with analyst Ray Wang at SAP's Forum event to discuss how IT convergence and social media are shifting what it means to engage.

Unified communications, mobile, Cloud, Big Data and social. According to Constellation analyst and founder Ray Wang, these are the five forces of change driving the consumerisation of IT. And what's really exciting him is the convergence of these disruptive technologies.
He uses the humble alarm clock as an example. “Your meeting at 9AM gets cancelled, so what time should your alarm clock wake you up? We don’t know. But we now have alarm clocks that look at your traffic or the alarm clock is talking to the car which is saying ‘You need seven minutes to get gas.’ And so it calculates how many more minutes of sleep you get.
“When machines are talking to machines, and machines are talking to people, we get this convergence that’s shifting what it means to engage,” he explains. “We’re rebuilding the matrix as we speak.”
But the shift in engagement does owe much to one of the five forces in particular: social. “Social’s changing the world because we’re traversing space and time and helping us manage relationships in a way that we never thought about,” says Wang.
Social’s emergence in business is changing how people work with each other. Previously, relationships were mostly driven by cost which resulted in the devaluation of people and ultimately customers, says the analyst. As a result, everybody revolted and set up their own communities to engage with each other. But now, he says, businesses are asking themselves how to bring that back inside the organisation?
“Internally, social business is trying to shift how information is distributed. In the old days it was hierarchical and dictorial whereas today we’re having conversations and things pivot.”
Managing social conversations
And of course social is also having major repercussions for the way in which businesses approach engagement with the customer. In particular, well-timed and crafted marketing messages no longer necessarily make an impression on the modern social customer. In a recent article for Harvard Business Review, Wang explains that customers now increasingly ignore targeted marketing campaigns and instead rely on social recommendations.
For customer-focused professionals, they must now ensure they learn how to manage these social conversations - it’s important to have as many people as possible talking positively about your company in the social space, he explains, particularly if your customers become a community of brand advocates.
But the problem for most companies is that with multiple departments testing disparate initiatives across multiple channels, there is an unholy mess emerging, and there is a desperate need to join up these channels to effectively support customer communication.
Constellation’s DEEPR adoption framework details the multiple stages a disruptive technology must pass through, based on metrics, until it becomes an adopted project. But the problem of multiple departments/multiple initiatives still remains.
“If I’ve got five or six different departments and five or six different systems, what does my customer record look like? Am I still even capturing interaction history? I don’t have a complete view. This is where the architecture becomes important – making sure that people agree on a definition of a customer, what we’re measuring, how many times is it measured – the point is to get it where you capture it once.
“The single customer view isn’t obtainable but what you need is really good integration,” he says. “So I can take back my marketing integration, take back to my social communities, take a social analytics feed, take back and see what’s going on in my blog and Facebook and build those composites very quickly. I can build a composite map and make quick decisions and that’s where the integration comes into play.”
Trading privacy for convenience
But Wang is no social media zealot. Facebook, for instance, is not popular with him.
“We don’t think you should be on Facebook – it’s dumb to trade your privacy for convenience. It’s also dumb to keep driving traffic into Facebook. You should drive traffic to your sites and your communities by pulling from Facebook into what you’re doing. That way you have control of the data and make sure that you’re not just selling stuff back to Facebook, which you’re going to buy again.”
And he has even stronger opinions when it comes to the role of the individual on social networks - and the right of the consumer to be off the grid.
“The right to be offline is going to be more important than anything else in the next decade, even in the next century. Give me the right not to be tracked – it doesn’t exist right now," he explains. 
“When and if that occurs to the point that you no longer have cash, you have lost the right because as soon as you trade in digital currencies you are tracked every piece of the way. Today I can make a purchase anonymously - in the future with digital currencies and payment technologies that all goes away.
“So if there’s anything I would encourage people to do in the next 12-18 months, it’s to support those people that are fighting for the right to protect your privacy. I don’t believe what Zuckerberg believes. Privacy is what we choose to make a value out of, and so if you want to keep trading your privacy for convenience, go with Mark. But if you really believe that you should have a right to privacy then go fight these things. Join groups like EPIC who are fighting for this around the world to at least give you that level of privacy.”

Replies (4)

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By Richard Snow
28th May 2012 15:58

While I agree with much of what is in this article, I think there are a few points which miss the mark. At Ventana Research we believe cloud computing, mobility, collaboration, big data, social media and business analytics will lead to more innovation in the way business operate and how they consume IT. As result we further believe that companies must now operate multimedia marketing, sales and customer service, and customer service in particular will be the responsibility of multiple business units. Getting customer engagement right will therefore be no easy task and will require cultural change as well as people, process, information and technology change. The foundation will be a single customer view. Unlike Ray, I believe this is now achievable with several vendors now able to integrate and process customer data from multiple structured and unstructured sources, combine this with event driven data and thus produce a single view. We recommend organizations seek these out to help provide the information to drive new initiatives.

I am also no social media zealot but you can’t ignore the obvious; consumers, especially the younger generation, live, play, collaborate on Facebook and companies ignore this at their peril. Getting its use right is also not easy but I believe companies must build it into their multimedia customer engagement strategy. As another indicator the impact Facebook is having, I am seeing more and more vendors make their user interface look like Facebook, so new users are more comfortable using their products.

As for privacy (and making payments), I believe once more there is a cultural shift  and many people, once again particularly the younger generations, and not so concerned as were previous generations. Like it or not it is hard to stay private: make anything but a cash payment and someone, somewhere is capturing it, make a phone call or send an email and it is likely someone is capturing it, write on social media and for sure someone is capturing it. Maybe people don’t understand the implications but in an internet-dependent world, I suggest it would be hard to go back to “the good old days”, and I am not a member of a younger generation).

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By ChrisB_usa
29th May 2012 06:08


Excellent article. You highlight a clear issue that all enterprises need to be aware of - privacy.  However, I think the impact of these mega-trends (cloud, social, mobile, big data) are going to change the face of applications forever.  I foresee a day when retailers will deploy their applications into their customers favored social network - rather than expecting people to come to their sites.

As you and Richard both point out, technology is evolving. Solutions such as "Social MDM" enable enterprises to extend their understanding of customers from within their traditional enterprise systems out and into the social networks. This will enable a whole new world of customer engagement allowing enterprises to deliver their in-store experience through social networks.  For example, retailers will now be able to present products to customers based upon what their friends are doing - a wholly more powerful approach than simply recommending products based on anonymous buying patterns. 

Clearly trust will be an important element of such a strategy and enterprises need to proceed with care - brand can be damaged quickly when trust is abused.  The critical element driving this is DATA integration.  By focusing on the data, enterprises are learning from the lessons of social media and beginning to treat their customers as humans, and not as account numbers.

However, I don't think you can ignore this massive new channel. We are in the early days of truly understanding it and I am a firm believer that consumers will demand privacy, security and trust of their favorite brands.




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By rwang0
29th May 2012 06:42

Thanks for the comment!  IMHO, we are moving forward in progress. But if it weren't for groups such as EPIC helping us shape the debate, we'd be succumbing to every effort to take our privacy for granted. I think we'll get to a balance but I'm not ready to say privacy is dead. It's going to be what we as a society demand.



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By rwang0
29th May 2012 06:45


I agree. I don't think you can ignore Facebook. But like AOL before it, we can be smart about how we direct traffic and we should prepare for a day where the public disowns #facebook.  Every large channel will go through ups and downs but at the end of the day, customers don't care what channel you operate in. they want a seamless experience. If you want to have a bit more influence, you may want to own that experience or as much as you can.


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