Got Social Strategy? Big Deal !!

Social marketing is growing up: Not only have activity levels across social communities risen, but the number of brands now applying more focused and disciplined approaches to their social media communities has increased significantly over the past year, according to a study by ComBlu.

Among four defined stages of social media participation, nearly one-third of brands (25 out of the 78 studied) have a cohesive strategy for social engagement, compared with 20% who did so a year earlier. Such brands have a solid social media approach, with multiple activities rolling into a single online experience, according to the study.

Among the brands studied in 2010:

• Social Experimentation is most prevalent: 46% of brands are experimenting with social communities, lacking a long-term engagement approach, using instead a series of one-off experimental marketing campaigns.

• Community Ghost Towns (unpopulated communities) now make up 15% of communities, down from 24% 2009.

• Community Overload (multiple communities fighting for attention from the same audience) afflicts 5% of online communities, down from 9% in 2009.

Below, other findings from the second annual "State of Online Branded Communities," which explores 241 social communities among 78 major corporations.

Brands Improving Integration of Social Assets

Branded communities are doing a better job integrating proprietary community sites with other social assets such as Facebook, Twitter, and YouTube. In fact, the use of strategically aligned engagement tools grew to 76% of online communities in 2010, up from 28% in 2009.

Key trends among the communities studied include:

• 51% of communities have visible active community managers who are the "face" of the brand and makes interactions more personal, up from 32% who did so a year earlier.
• 48% enable social networking between members, up from 30% in 2009.
• 85% allow for user profiles, up from 49% a year earlier.
• 86% use faceted search, up from 36% in 2009.

Untapped Opportunities

Many brands are still missing opportunities. For example, brand advocates are being ignored: Only 20% of communities have an advocate or expert group, that represents the "voice of the customer," contributes content, and helps recruitment.

Across other ComBlu-defined 2010 new best practices, brands' adoption levels are mixed:

• Share functionality: 61%
• Welcome messages to new members: 48%
• Campaigns and contests: 33%
• Content customization: 22%

Activity by Industry

Communities with the highest activity levels tend to focus on a specific need or interest, ComBlu finds. Despite creative engagement tools, those with no clear mission have less activity, overall.

Gaming (100%) and entertainment (89%) industries have the most active communities, followed by insurance (67%), technology (67%), and telecom (67%). With the exception of insurance, those industries are also the highest scoring overall (i.e., higher use of best practices).

Top Scoring Communities, by Industry

Based on adoption of such best practices, the highest scoring* industries are gaming (39%), telecom (39%), technology (35%), and entertainment (34%).

The most improved industries from 2009 to 2010 are entertainment, telecom, financial services, and technology.

Top-Scoring Brands

Across the 12 industries analyzed, the following companies are the highest performers:

• Auto: BMW Motorcycles (28), Toyota (26), and Ford (23)

• Banking/Financial Services: American Express (48), Bank of America (36), and JP Morgan Chase (33)

• Beverages: Starbucks (36), Pepsi (33), and Coca-Cola (21)

• Entertainment: Discovery (45), Bravo (42), and Comcast (41)

• Gaming: EA (47), Activision (44), and Xbox (42)

• Healthcare and Pharma: Johnson & Johnson (21), Bayer (20), and Novartis (16)

• Insurance: Humana (39), GEICO (38), and State Farm (28)

• Packaged Goods: Kimberly-Clark (44), Kraft (35), and Proctor & Gamble (35)

• Retail: Sears (44), Whole Foods (41), and Best Buy (32)

• Technology and CE: Hewlett-Packard (45), Dell (42), and Microsoft (40)

• Telecom: AT&T (44), Verizon (44), and Sprint (28)

• Travel and Hospitality: Marriott (30), Fairmont (26), Southwest (26), and Starwood (26)
  

A detailed analysis of the 75 brands studied is available.

*Scores between 0 and 34 are considered "low performers" and are in the red zone. Scores between 35 and 49 are high performers and place in the green zone. Scores of 50+ are considered "best practices leaders."

About the data: The audit of 241 online branded communities among 75 US companies was conducted by ComBlufrom July to August, 2010. Each site was analyzed against 22 community best practices. A separate scorecard was used for the 2010 study to track adoption of an additional ten best practices. None of the companies were aware that their sites were being analyzed, and ComBlu did not contact these companies prior to the analysis of the data it collected.

• Connection to offline engagement: 20%

In addition, only 40% of the communities offer rewards or recognition programs, considered key drivers for sustaining participation.

Microfinance In Andhra Pradesh

Here is an article from HBR, reiterating my view on Micro-finances, I will bet on that even today, this unregulated cash flow is eating ito the pockets of the "poorest of the poor" that they claim to support. I have met a diplomat from Bangladesh who opined that "Even Grameen Bank has failed to make any financial impact. But, yes it did mobilize the awareness among the public". I do not have any questions in telling that the For-Profit turned "NPO" of Andhra Pradesh, SKS is a loan shark with "do good" exterior whose ulterior motives have to be scanned yet.

Feel free to post your opinions in the comments.

Article Starts:

Is microfinance the new subprime? We've been hearing that portentous analogy for years, and now that the Indian state of Andhra Pradesh is riveting the world with stories of loan-shark-style microfinanciers driving borrowers to suicide, the claim has taken on fresh currency. Considering the industry's growing commercialization, it is an obvious comparison to draw. But the most obvious metaphors are not always the most appropriate ones, and sloppy metaphors can easily drive bad policy.

For sure, there are some real similarities between microfinance in India today and the pre-crisis subprime mortgage market in the U.S, and we can learn from them. As microfinance institutions have quickly grown, profit-seeking money has flooded into the sector. Loans to poor households have kept pace, with the number of borrowers surging from 8 million to more than 20 million over the past three years.

With this growth, some borrowers have gotten in over their heads. Press accounts offer sensational stories of borrowers pressured to take out one loan to pay off another falling even deeper into the chasm of debt. While it is difficult to discern reality in Andhra Pradesh, given the tangle of political and business interests at play, we can't dismiss the fact that people in India, just like people in the U.S., want to be better off. When resources are available, they will take advantage — and some will go too far, whether driven by pushy salesmen or their own desires. This is inherent in finance, which is why any system, not just one that is rapidly commercializing, needs safeguards, like ways to monitor over-indebtedness.

This can be difficult to see when it comes to microfinance, because, much as with the subprime market in the U.S., there is an ideological underpinning that makes us want to believe nothing too bad can happen. In the U.S., owning a house is considered a fundamental part of the American Dream. Similarly, microfinance promises to change lives, to help people lift themselves out of poverty. Microfinance brings empowerment and dignity, we tell ourselves. And who could be against dignity? The U.S. certainly could have used some pushback on its ideology and perhaps the same can be said of microfinance today.

But while it may be useful to draw some comparisons to the U.S. subprime debacle, India's experience is drastically different in significant ways.

To start, we should recognize that Andhra Pradesh is in a much less precarious position than the U.S. was a few years ago, when an entire nation was caught up in the delusion that house prices would never stop their steep ascent. Most of the complaints about the microfinance sector in India come back to unscrupulous practices like loan officers talking borrowers into taking on too much debt and collection agents being coercive. These are serious allegations and the government of Andhra Pradesh has smartly moved to ban strong-arming, increase disclosure about loan costs, and control the number of loans one person can receive. But the core of the problem is at least not a profound misunderstanding and misuse of most families' largest asset.

Another important contrast follows from the fact that the U.S. subprime mortgage industry was built on a fundamentally different equation — and a fundamentally different pathology. At the heart of the subprime crisis was risk-based pricing. Thanks to credit scores, lenders had elaborate knowledge about any given individual's likely ability to repay a loan; the game was not to just lend to those who could repay, but to price loans sufficiently high to cover the costs of those who were expected to default. The premise of microfinance is at the other end of the spectrum: lenders intend to recapture every dollar they loan out and take great pride in the high percentage of loans repaid.

It is easy to compare a high interest rate on a subprime mortgage to a high interest rate on a microfinance loan, but these two rates come from very different philosophies about how to make money from extending credit. In the case of microfinance, if anything, the problem rests with an overly obsessive pursuit of perfect loan repayments. The relatively high prices for microfinance loans (beginning at about 25% on an annualized basis) largely reflect the high costs of small-scale transactions in a labor-intensive business. Microfinance interest rates in India are already falling in the wake of this month's crisis; slashing them further through stringent usury laws will undermine an industry which holds the promise to do substantial good. In that light, last week's microfinance law capping interest rates at 24% per year in Andhra Pradesh strikes a laudable balance between the interests of populist politicians versus lenders trying to keep businesses afloat.

The most important distinction between microfinance and subprime mortgage lending is that most microfinance institutions got their start through an impulse to create opportunities for unbanked and excluded citizens. Embedded in the institutions' DNA is a desire to do right by the world, not just make money off of it. Commercialization may be changing the industry — sometimes too fast and creating conflicting interests — but there are still plenty of good people involved who are open to having thoughtful conversations. Many argue that microfinance in India is now "too big to fail." Perhaps, but the industry is not too far removed from the lives of poor Indians to care deeply about the direction things head from here.

Feel free to post your opinions in the comments.

Noise at the Office: How to Cope by Patrick J. Skerrett

I work for a company with an open-door policy. Open doors send an excellent message about collaboration and transparency. But they are tough on the ears and concentration. I hear the office printer and copier chug away every few minutes. Chats from the conference room and kitchen — both six paces from my door — waft in, along with ringing phones, voices in the hallway, speaker phone conversations, and other sounds of a busy publishing office. Semi-protected by three walls, and a door I can close if needed, I have it better than my colleagues who work in cubicles.

The majority of research on noise at work has focused on high levels of sound, the kind that workers are exposed to in steel mills or automobile factories. An analysis of 15 large studies showed that chronic bombardment by loud noise at work isn't good for blood pressure or the cardiovascular system. Far less work has been done on lower decibel, less-damaging office noise. The limited research, most of it done in Europe, indicates that office noise disrupts concentration, decreases productivity, and chips away at good health by increasing stress.

Noise has been a problem since as far back as people have worked in large offices. And it isn't getting better — a study from the University of California, Berkeley's Center for the Built Environment found that noise and lack of speech privacy are the biggest complaints of office workers. Adoption of the open office makes it difficult for many workers to escape sounds generated by their coworkers, while better design of heating, ventilation, and air conditioning equipment is reducing the white noise that once masked office sounds. Green design, with its emphasis on hard surfaces and environmentally friendly insulation, is compounding the problem, says David Sykes, executive director of the Acoustic Research Center in Cambridge, Mass. Benign neglect of the Noise Control Act of 1972 since the early 1980s hasn't helped either, says Sykes.

Acoustic engineers and designers rely on an ABC algorithm to control sound:

Absorb sound with ceiling tiles, fabrics, and carpets

Block sound with walls, panels, partitions, and other barriers, and buy quiet equipment

Cover sound by masking it

If you are involved in your company's capital planning or facilities management, you may be able to help institute office-wide approaches to a quieter workplace. (To make the business case for a big project, try the return on investment calculator offered by CCR Associates, an acoustics consulting company.) For most of us, though, the best bet is to try to mask incoming sound so it isn't quite so bothersome, says Charles Hayden, research acoustic engineer for the National Institute for Occupational Safety and Health.

One colleague of mine tunes a small radio to an AM sports talk channel and keeps the volume down low. She says the babble of voices creates a sound buffer from the rest of the office. I love the sound of birds, so I often play Birdsong Radio (iTunes Radio Ambient channel) to cover up office noise.

A free, Web-based application called SimplyNoise serves up three different "colors" of sound — white, pink, and brown noise — that help obscure distracting sounds from your office mates. App developers have gotten into the game, with a slew of white noise generators for the Android, Blackberry, iPhone, and other mobile devices. Stand-alone sound devices are another option. Marketed mainly as sleep aids, these machines are perfectly appropriate for the work day, too. They range in cost from $20 to $200 or more. Some, like the Privacy Guard, can even respond to changes in your acoustic environment by automatically adding sounds and increasing the volume.

There's one more thing you can do: Don't forget that you, too, generate sounds that intrude on your coworkers. Keep your voice down, your music low, and make noise unto others as you would have them make noise unto you.