International Digital Marketing

Gamification and G-commerce, gamification of E-commerce, are creating a lot of buzz across the globe. According to M2 Research, a gaming and technology researcher, gamification industry revenues will increase from less than 100 million dollars in 2010 to 1.6 billion dollars by 2015. Google on the other hand has invested recently 100 million dollars in the social gaming company, Zynga, and is planning to launch Google Games in the near future.

 Gamification means using game mechanics for non-game apps and mobile/web sites to increase user participation; however “gamification of your brand” does not mean creating a new Farmville. It is not just about making things more fun or turning them into a game. It is about motivations, rewards and engagement.

#1 Set up your objectives

Before jumping into gamification, think thoroughly what exactly you want to achieve. Do you want to increase brand awareness, engage users or loyalize your existing consumers?

#2 Do research and get feedback from best customers

Gamification is cool, but it is very easy to get it wrong – especially if you are gamificating an existing service with an established user base. Do research and ask your best customers what motivates them. Some of them might be motivated by physical awards, some of them by social recognition and some of them by accomplishment only. It is important to get it right to avoid negative or lame reaction. If you really are not sure, test first with a small budget gamification project to see the reactions.

#3 Make sure your gamification is aligned with your brand/industry

There are many types of games, rewards, competitions, trophies, progress reports and other ways of recognition. If your “game” has nothing to do with your brand or your industry, it will only confuse people. Also, make sure it is suitable for your audience, since consumer and business customers and different age groups behave very differently.

#4 Use right gaming techniques for your users

Games are thought as fun, but they do not have to be. The point is finding a way to transfer the techniques that make games addictive for users to other things. By understanding what motivates the users and using the right techniques can reward them for doing things that ultimately help you to achieve your aims.

Fiat did this with the award winning eco:Drive. It is a fun, simple customer loyalty scheme where users could use USB sticks to analyse how they drive and receive suggestions for improvement so they could reduce their CO2 emissions and get better fuel economy. Also an online community called ‘ecoVille’ was created that was populated by consumers around the world using the ecoDrive technology.

Another example of this is the Nike Training Club, an app with an own personal trainer, which motivates users with customized work-outs and rewards. After first weeks of launch the app became iTunes App of the Week in the U.S. and reached the no.1 position in iTunes Health and Fitness category.

#5 Do not try to do it all

Like in Social Media, there is almost an unlimited choice of different and creative things you can do. But just like in Social Media – do not try to implement them all. Focus first on your goals (what behaviour you want to motivate) before you select the tools (which game techniques should you apply). Be selective and see what techniques would work best to achieve your goals.

#6 Do not make it too easy

People love completing a game and reaching the top level, but they love a challenge much more. It is much more motivating for users to really work for the achievement to reach it, than reaching it with a small effort. First level rewards and achievements should be relatively easy to trigger interest and get users engaged, but they should become more difficult to conquer closer the users are the end goal. Harder it is, more likely the user is going to share their achievement with the world.

#7 Do not focus only on extrinsic rewards

In gamification it is important to have extrinsic rewards such as prizes, position in ranking, badging, trophies etc. yet intrinsic motivators such as self-confidence, fulfilment, friendship and loyalty are equally important. Try to think a way to combine these two worlds to create even more satisfying experience.

#8 Use real-time feedback to improve the experience

Just launching a “game” is not enough. It requires commitment and as you start to see results, you may see potential for growth. A basic program may work as a novelty among the users, but in long term users will be asking and expecting much more than a simple trophy. Getting user’s feedback and ideas can help you to improve and offer your customers even better, engaging experience. Make extensions and enhancements to continue to evolve it for the most involved users.

#9 Take advantage of the Social Media

Use Social Media as a promotion, recognition, support and engagement tool. It is possible to increase participation in social media enormously if you get it right. For example, by allowing the user to publish the distance he ran in Twitter or Facebook or recognizing publicly the influencer of the day.

#10 Involve mobile

If the gamification has not focused initially on mobile site or apps, make it mobile friendly. With emerge of Smartphones, people carry Internet with them all the time and being able to influence and engage everywhere makes the user experience even more engaging. If the “game” is successful in the web, creating an app can enhance the program even further.

Highly-conscious opinion leaders

Typical gamer is not anymore the stereotypical “loner”, but can be anyone who wants to feel like an achiever. According to the report, gCommerce: The Gamification of eCommerce, gamers are actually highly-conscious consumers and opinion leaders, who are 50% more likely to be influencers among their friends. Gamers are also 20% more likely to be online shoppers than the average non-gamers. That is what makes the gamification so interesting for brands.

If the motivation is right and the techniques you selected encourage and reward the behaviours you want, you can give these users more reasons to spend time with your brand and tell others about it. If you do not listen to your users and get the motivation wrong, well that is another story.

A recent analysis by Goldman Sachs Investment has estimated Facebook’s value to be 50 billion dollars. Twitter’s estimated value reached 4 billion dollars in January 2011 and the business network LinkedIn is worth more than 2 billion dollars.

But these three are not the only social networks that have reached astronomical values. There are more members in the billionaires’ social club such as Zynga and the most recent Groupon.

What all these companies have in common is their youth. All these platforms are less than 10 years old, which demonstrates how incredibly fast they have grown and obtained their high stock value. While many investors have got rich betting on them, it might well be that the next bubble to burst is social networks. Why?

Unfamiliar business model

The social media companies have surely known how to build an empire formed by hundreds of thousands of users all over the world. Only Facebook has more than 500 million users, Twitter is close to 200 millions of users and LinkedIn has already more than 80 million valuable business contacts. Zynga on the other hand receives daily millions of online players and Groupon has a database of more than 35 million users happy to receive offers of the day to their inboxes.

However, in spite of these unusual figures, the majority of the social media companies are still investigating how to receive economical benefits of their large user base and with different results. LinkedIn gets benefits from its own users who agree to pay the premium access with bigger functionalities than basic account, while Groupon gets a commission for each client who buys. But Facebook, Twitter, Zynga and most of the other social networks trust in their advertising income.

Return of investment: Advertising

But is targeted advertising in social networks that effective? According to Jeffrey I. Cole, the director of the Center for the Digital Future at USC’s Annenberg School for Communication & Journalism, “users express strong negative views about online advertising, but they still prefer seeing ads as an alternative to paying for content. Consumers really want free content without advertising, but ultimately they understand that content has to be paid for — one way or another.”

So it is not wanted, yet tolerated. There are also various apps for users to remove advertising completely from the social media platforms. Yet effective or not, it seems like at least Twitter and Facebook do not have a choice. According to the 2010 USC Annenberg Digital Future Study on Twitter, a whopping 0% of the interviewed users said they would be ready to pay for the platform. And it is not difficult to imagine that a similar percentage would be ready to pay for Facebook (and their current slogan on sign up page is effectively “Sign up. It’s free and always will be!”).

Question is: will companies keep investing on the social network ad space in the future, if these advertisements are blocked or ineffective?

Return of Investment: Users

How to measure social media? Unlike in any other business area: no one really knows. People say they do, but to be honest…if you want a straight answer what your ROI on social media campaign or Facebook group is or will be, you are likely to get a following conversation:

“There are so many different ways and tools to measure social media, it really depends what your goals are.”

“Yes but how many leads and sales this campaign is going to create?”

“Human interaction is so difficult to estimate… Right now I can’t tell you the exact figure you will have, but  in the end of the campaign we can tell how many more people “liked” your brand or talked about you”

“Yes, but will I know how many of these people actually bought my product?”

“Well…”

Do not get me wrong, social media is a very effective communication and customer service tool yet very, very difficult to measure. Without a clear idea of ROI, it will be harder to convince investors or companies to stay if they lose confidence on the platform and want to abandon the sinking ship.

Dot com – fever?

Previously mentioned social networks are the biggest ones with the largest number of users, yet creation of different types of social networks has boomed all over the globe, waking up interest of investors of all sizes. They are investing on a new virtual business model, living in some way the dot com company fever, in which the big investments that promised fantastic ROI turned into nothing when the bubble exploded.

Constantly changing virtual world

This kind of risks could happen in social networks, because there are already examples how big virtual companies can fall quickly when new concepts and improved versions of the same model arrive.

Examples of this are the AOL and MySpace, companies who were in their time the little favourites of the Wall Street and “going to conquer the virtual world”. Now their current economical value is just a fraction of the value they had in their moments of glory. The brand lost its value, then the confidence of the investors then the market to new comers such as Facebook. MySpace France office close down already few years ago and now even German office is shutting down, even if the platform is trying to re-launch itself with a new image.

At present, almost every marketer “likes” Facebook, however there was a time when also Second Life was supposed to become “a must” and brands invested great amount of money to get on board. Where is it now? I am not saying brands should not use Facebook and Twitter or other social networks, in the contrary they definitely should. It is just a word of warning to potential investors to not to get too excited on new virtual business models without certain amount of caution. Many social media companies can for sure be easily substituted by new concepts or new technologies in the constantly changing virtual world.

Right now Facebook, Twitter and other social media platforms are powerful tools, but let’s give the new generation some time and – POP.

Influencers…one of the hot words of the 2010. Long way short, the culture has changed and people search real recommendations from real people, not brands. Some real people have more influence than others, brands should identify them and encourage them to tell everyone how great their products are. OK this far.

Where it goes wrong is the way brands are identifying and reaching these influencers. Most of the brands rely only on numbers and reach such as quantity of Twitter followers, Facebook friends or LinkedIn contacts and number of impressions the posts get. But what is real influence and who has it? To be honest, real influence is not about number of tweets or followers, it is all about context and expertise.

Scientists at Northwestern University, Illinois, ranked the most influential people “tweeting” based on how individuals shaped trending topics. According to the study, Twitter’s most popular influencers (mostly celebrities e.g Justin Bieber who alone accounts for 3% of Twitter’s servers) are actually not that influential. Surprisingly or not, the real most influential users on Twitter were individuals with lower profiles, but a great expertise in their own fields. People listen real people, but when you think about  it -  is a celebrity one? They are not perceived as a real persons anymore, but more as brands with its own strategy and products.

What comes to the other metrics, some companies sell the idea of “easily identified influencers”. For example Sponsored Tweets declares that brands can buy influence just by paying influential Twitter users to tweet their messages, but its efficiency is quite questionable. To be honest, searching real influence in efficient manner on social media platforms is like running a real-time PPC campaign: monitoring market trends, adjusting campaign in the real time to target the right keywords (influencers) and modification of the message so it is aligned with what people are looking for. Tip: Instead of reach numbers, look closer at retweets and trend setters.

However, real influencers unlike keywords cannot simply be bought. There are two problems with “pay-for-play” strategy:

• First of all the cost and ROI. Courting influencers with free products or trials to create buzz can be expensive. Note that with regulations from the FTC, people who receive products for trial or payment from brands need to tell it in their review. This is perceived normally by consumers as bribing and decreases the efficiency of the influencer’s reviews.
• The second challenge (or problem how you like to see it) is that these people may not want to pass or use your message on marketing purposes. They actually might tell the world you were trying to pay them and influence their objectivity. Ouch.

But what if we turn the question around? Instead of attempting to turn influencers into our advocates, we would turn our advocates into influencers?

Many of your customers are dedicated advocates who love your products, your brand and your industry. Other people trust that these advocates’ opinions are authentic, and are influenced by them. The problem here for the brands has been that these normal people do not have the reach of influencers.

But they could, if we forget (and stop wasting money on) the popular, yet irrelevant influencers and instead identify real brand advocates and concentrate helping them be seen and heard by more people. By empowering the customer to act as advocate beyond his personal networks, could turn him into a influencer. In the end, how much would it cost to give him some help with blogging, twitter, facebook, linkedin and other social networks? Surely less than paying more than 10.000£ for a single Britney Spears tweet.

User-generated content (UGC) is the key. These fans are delighted to be asked to share their opinions, since it shows that their favourite brand knows who they are and cares about their opinions. And since they are real persons, the potential and current customers trust their opinion while making their purchase decisions.  By enabling and encouraging this conversation, you are creating a collective influencer network that can drive more sales.

Back to the starting point: how to identify these potential influencers? It is simple – let other customers decide. For example, let site visitors vote on the helpfulness of other customers’ feedback and you will get the ranking. Give public recognition for your top contributors, which will encourage other advocates to react. As an example, Apparel retailer Free People created an email campaign featuring their top reviewers and increased their review volume by 93% that week. They also received more quality reviews after the campaign with more information and details.

Whichever way you prefer, courting or helping, do not forget how important it is to be honest and respectful.  Do not use hard sell, tell these people you would like to hear their opinion and it really counts. Top influencers or potential top-influencers love hearing it, but please do not lie. They might love you or your money, but they are not stupid.

Who does not like graphics, charts and images? Maria Pergolino classifies in her blog post the top 5 B2B Marketing Infographics, but I believe they are relevant also for B2C. After going through all the five, I have put them in new order according to my personal preference:

1. CMO’s Guide to the Social Landscape

A very, very interesting social landscape infographic. It  is a guide to help you understand how best to leverage major social media sites (Twitter, Facebook, Flickr, LinkedIn, Youtube, Digg, StumbleUpon, YahooBuzz)and to evaluate which one suits your needs most. It is a clear compare and contrast grid ranking the platforms (Good, Ok, Bad) among customer communication, brand exposure, traffic to your site and SEO. I find it great, but it is a shame it stops there, showing examples of only a few sites. However, if you consider them as examples of their genre, you will be able to adapt them to your local platforms. You can see microblogging site,  personal social networking site, image and video hosting site, professional networking site, video sharing website, social news site, social news community and social bookmarking site. For example, even if you are using different professional networking site, it probably has the same pros and cons as LinkedIn.

2. Who participates Online

This infographic shows you what people are doing online and which age groups are doing it. Even if it unfortunately only concentrates in U.S. it is a nice indication to use when evaluating your social media tactics. It shows the %/age group of: Content creators (write blogs, post videos), Critics (who post comments, reviews), Collectors (RSS, bookmarking), Joiners (Social network users), Spectators (read&watch) and inactives (online, but not connected.

3. Life Cycle of a Blog Post

An excellent infographic of the blog lifecycle showing a detailed process showing where the blog post goes (servers, data miners, spam blogs), what the ping servers contact (search engines) and what the reader sees (blog, socal media, bookmarks). It gives you an understanding of the more technical side of blogging and what you should take in account to optimize the results.

4. Visualizing Facebook

Considering that there is even a Facebook movie coming up, The Social Network, this social network should definitely not be ignored. I would not use it for the professional networking since people like to keep their personal and professional lives separated and do not necessary like to show their weekend photos or status updates to potential future customers (and if you join a group there is a danger they can see everything – especially after Facebook’s sometimes questionable privacy politics). Anyhow, for consumer marketing Facebook is beginning to be “a must”. This infographic shows the profile of the average Facebook user, which is very interesting to know…but with a little money you will be able to get the statistics of your exact target group: just contact the company.

5. Corporate connection

A visual representation of globalization showing the connection among 3 celebrities, 35 corporations, 40 subsidiaries and more than 300 brands. It is a nice snapshot to show you it is possible to be all over the world and also that your competitors are already going global.

Have a close look at these five and think how the information could be adapted to your brand. They look very nice and can be very useful if adapted right.

“In using the Internet to anonymously talk about their troubles, or show off their strong points, or make people laugh,” he said, “people in Japan can now interact based on what is actually being said, without worrying about who is talking.” – Tetsuya Shibui, Writer

The growth of Twitter in Japan has been explosive since January 2008. According to the article by the Japanese Twitter book author Masato Kogure, the estimated growth of Japanese users will rise from the 5 million users (February 2010) to 10 million users by the end of the year.  Japanese tweets represent 14% of all the tweets worldwide. In the beginning of the year, the local Diamond Magazine, a well-respected business magazine, declared that “in 2010 you can’t say that you can’t “use” Twitter”.

Considering the failure of MySpace in the Japanese market back in 2006 and the slow growth of Facebook since 2008 – foreign social networking sites LinkedIn and Facebook have under 1 million users in Japan – why Twitter is so successful?

The secret might be that Twitter has abandoned the “foreign” and global mode and has gone local by adding “a distinctly Japanese flavor”. In October 2009 Twitter announced the new release of a localized application for the Japanese cell phone market, which nailed it. In the end Japan is a society that uses primarily mobile phone for social networking. According to a recent research by Mobile Marketing Data Labo, 75.4% of Japanese respondents only accessed social networking sites from their mobile phone (and not from their PC). 3G penetration stands at 95% of the market and their mobile market is far more developed than we see in Europe or North America. What makes this even more interesting is that we are not talking only about early adopters here, but a wide professional demographic. But it does not end there: Twitter-mania has gone so far that the Japanese themselves are revolutionizing the way to use the platform by beginning to integrate it with their society.

Some examples provided by Windmill Networking blog:

• Politics: In 2009, one of the two leading Japanese political parties, the LDP, announced that all of their elected officials should have Twitter accounts. To stay up-to-date, it was necessary to read the tweets of active government officials.
• Television: A major TV broadcaster created a weekly serie, “Sunao ni Naranakute,”  based only around a group of young people who met and created relationships from Twitter.
• Telecommunications: The CEO of Softbank Masayoshi Son, one of Japan’s largest cell phone carriers and exclusive distributor for the iPhone in Japan, recently declared: “If it doesn’t come with Twitter, it’s not a cellphone.”  A Twitter application will be shortly available on all new cell phones distributed by Softbank, not just the iPhone.
• Advertising: Coca-Cola Japan replaced the “search for us on the Internet” with “search for us on Twitter” with a keyword to lead its users to a landing page link for its campaign.
• Services: The Japan Weather Association (JWA) announced that they would integrate tweets with their weather maps.  Because of the location-based option in Twitter, the JWA is linking tweets concerning the weather.

But watch out with the local social networks: the mobile social networking leads to a different type of consumers behaviour. In Japan, mixi, 17 million users in Japan, Mobage-town and Gree are very successful social networks. The popularity of Twitter in Japan has brought two of its competitors, Ameba and Mixi, to create their own “Twitter-like” functionality such as “Mixi Voice”. Important: you need to have both an invitation from a present user as well as a Japanese mobile phone to register in Mixi, which limits the Mixi demographic to those residing in Japan.

According to Matt Rhodes, the foreign and local Japanese social networks are very different in two ways:

1. They put gaming either central to or highly within the user experience. Facebook and Twitter tend to be about content exchange or organization whereas the Japanese social networks have a strong gaming element that attracts and connects users.
2. Premium content is often paid-for. Mixi, in particular, provides premium content and features at a fee to users and this is easily done by adding it to their mobile bill.

Another difference between foreign and local networks is very crucial: Privacy.

Japanese social networking users tend to like their privacy and therefore will tend to use a nickname instead of their real name, while foreign networks usually require user’s real name. Twitter has been more successful in this area than Facebook and LinkedIn, since the platform also allows nicknames. A fundamental part of the Mixi platform is that the users can see who has viewed their profile with the “ashiato” (“footprint”) functionality, which in many foreign networks it is not possible. The communication style in these networking sites differs as well: the foreign networks are “pushing” pictures of “people you may know” or some social ads.  Japanese users do not like to show their pictures to someone they do not know, they prefer searching people they know or adding people they already have a conversation with.

Facing an increasing use of 3G access  in Europe and US, we should pay more attention to the more developed mobile markets like Japan. Use of social networking through mobiles is already growing and adopting few best practices from Japan might actually get you one step ahead of the competition. If reaching out to Japanese market, remember their taste for privacy & mobile phones.

I had the privilege to participate yesterday on the short presentation by the senior team from LinkedIn Europe and US. After the usual global numbers, 65 million, we got to the interesting stuff:

In Europe there are 15 Million LinkedIn users from 43 European countries:

• Great Britain: 3,2M
• Netherlands 1,5M
• Nordics 1,5M
• Germany 800K
• France 1.3M
• Spain 750K
• Italy 1M
• Eastern Europe 1,5M

The network has strong presence in USA, yet in Europe it encounters two strong local competitors: Xing and Viadeo. Xing with over 8 million members in Europe controls the DACH region with more than 3.4 million members in Germany, Austria and Switzerland. The platform is highly localized: 16 languages, 30 thousand specialized groups and over 90 thousand live networking events/year. Viadeo has 1.5 million members in France, yet it is moving to the international markets with 1 million users only in China, compared with 1 million LinkedIn users in the whole Pacific ring.  It is also increasing its presence in India. The network has more than 20.000 groups and its user profile consists of 75%  professionals, 15% CEOs, 5% freelance, 5% others.

In Europe the localization plays a big role: when LinkedIn changed the Italian website in Italian, it suddenly got “the lost” users back. However, localization does not only mean translation. If you only translate the text that worked in US or UK, it does not mean it will work in Germany or Spain. People use professional networks for different reasons, you need to identify what they find useful and what they do not use to get a relevant message through. When doing business, it is better to use local networks to reach the local businesses yet if you want to reach international audience go for international platform.

But are the two European networks only present in Europe? Now there are some very interesting numbers. It seems like LinkedIn has been concentrating in USA (24M), Canada (1,4M) and Europe (15M), while its presence in other regions is not so strong: Africa (600K), South and Central America (1,2M), Oceania (800K) and as mentioned before: 1M in Pacific Ring compared with 1M Viadeo users only in China. Has LinkedIn been focusing too much in conquering Europe? Are LinkedIn’s European competitors leaving LinkedIn behind in other regions? It looks like “the war” in Europe between the professional networks might go Global.