scorecardresearch

India Inc wakes up to social media

From Facebook to LinkedIn, Twitter to Orkut, corporates are beginning to use various forms of social media to reach out to consumers, employees and partners, writes Kushan Mitra.

Cleartrip.com, an Internet travel agency, thought it had a sound online social media strategy. The company ran a blog authored by company Director Hrush Bhatt, had a Twitter account and also maintained forums where users could air their differences. However, on the evening of June 9, when Bhatt peeked in to see what users were talking about on Twitter, he found a link to an irate forum post by blogger Kiruba Shankar. Shankar felt that he had been given a raw deal by the company after using its services.

Hired over social media

Kaushik Ray, Senior Director, HRD, Dr Reddy’s Labs

Kaushik Ray, Senior Director, HRD, Dr Reddys Labs

Ray, an alumnus of Jamshedpur’s XLRI, got an invite to join the LinkedIn network of fellow XLRI alum Prabir Jha who happened to be the Senior VP and Global Chief of HR, Dr Reddy’s Labs. The two started exchanging messages over the site and five months after the two connected over LinkedIn, Ray found himself working with Jha. “My link with Dr Reddy’s started with LinkedIn,” says Ray. “On the verge of completing one year in the company, I look back at how it all happened, and all I can say is that it is pure serendipity.” Today, he spends at least an hour on the weekends on LinkedIn and is in the process of joining Facebook. He feels that apart from networking and building contacts, it is a good medium that allows professionals to share knowledge.

“We have got some profiles from LinkedIn and maybe we will formalise this as a channel (for hiring) now,” says Ray.

So Bhatt swung into action, anxious to douse the flames of a disgruntled blogger before it became a conflagration. On June 16, Bhatt posted the entire affair on Cleartrip’s blog in an effort to come clean on the entire issue. “There is no point claiming that you are customercentric, doing something about it but not letting the world know,” says Sandeep Murthy, Chairman, Cleartrip. “We live in a world where people have the ability to be heard instantly and brands can be built or destroyed very fast thanks to new media. Business has to learn to adapt.”

In 1439, Johannes Gutenberg invented the mechanical printing press and shook the foundations of the earth, as news and ideas—contained in books and papers—now began to fly around the world like never before. Gutenberg’s press led to the Renaissance, the scientific revolution and the Protestant Reformation amongst other things. The world was fundamentally and irrevocably changed. Today, a different—but ultimately similar—revolution in the form of the Internet has transformed the way you and I interact, through informal online networks of friends (Facebook, Orkut), artists (MySpace), visual junkies (YouTube) and professionals (LinkedIn).

However, the ultimate transformation that is taking place today is within the business landscape, worldwide—and increasingly so in India—where companies are beginning to leverage informal social networks to engage people, mollify customers, strengthen their brands and even hire people. For companies in India, the reasoning is simple: While Indian PC and Internet penetration rates are relatively lower than the West, India has one of the largest Internet population in the world—some 60 million regular users (not including mobile access).

Social media junkie

Jessie Paul, CMO, Wipro

Jessie Paul, CMO, Wipro

Paul joined the LinkedIn service quite a few years ago, and as a marketing professional in Bangalore, a city with few marketing forums, she also set up a “CMO Roundtable” on the service. The “by invitation” group is a bona fide hit, and members have begun making deals with each other. In fact, Paul says that she has not just learnt a lot but also managed to find her US marketing chief using this group.

Paul runs her own blog and also actively maintains her Twitter and Facebook accounts. She also ensured that Wipro has a Twitter account to reach out to the world at large and to monitor what is being said about the company.

“I don’t think social media is the best business to business medium, and I hate being sold stuff on LinkedIn, but it is an amazing business to consumer or business to employee medium,” says Paul.

Moreover, these users are the most sought-after customers with high disposable incomes, and companies with clear online media plans are waking up to the fact that they can reap the benefits of engaging with this audience. Those that don’t, risk losing the customers that they already have or slipping behind their more savvy competitors.

An Engaging Plan: Just what is social media? There is no exact definition of the term, but suffice it to say that just because a website is interactive does not mean that it fits the bill. A site built from the ground up as a community is more social than a news site which also is interactive, like, say, the Guardian newspaper’s various blogs. This is not to say, however, that the English newspaper will not, a decade down the line, have commoditised its online community into a cash cow bigger than its news operations.

There is, however, a very real distinction between “social” sites and interactive digital marketing ones like the one that Tata Motors built when the Nano was launched. This site had games built into it, where people could customise colours and pick their favourite ones—thereby sneakily helping the car company figure out which ones to use on the Nano. A clever idea, but far removed from a social media forum. However, when Tata Motors did launch the Nano, there was no mistaking its intention to use a full-fledged social media strategy. The company set up groups on Facebook and Orkut hoping to target the numerous official ‘Nano’-centric groups that had parked themselves on the site.

To its complete surprise, it found that one unofficial group on Orkut dwarfed the official ones—and it would have been a fatal mistake to ignore members not under the official Nano fold. “We engage with people on these sites, too. We react to criticism of our car and try to explain our position. Also, we often find that before we can react to the criticism, there are other members who come up to defend the car.” Even today, the official groups on these two sites, at around 17,000 members, are much smaller than the largest unofficial group on Orkut with around 52,000 members.

Funding over social media

Deepak Srinath (R) and Uday Disley, Viedea Capital Advisors, Bangalore

Deepak Srinath (R) and Uday Disley, Viedea Capital Advisors, Bangalore

Deepak Srinath and Uday Disley, both 34, had no background in investment banking till they floated Viedea Capital Advisors in Bangalore two years ago. But for financial backing they had from the Microsoft MD Rajan Anandan and immense personal faith in their business model, they had little support infrastructure to lean on. Funnily enough, this wasn’t a problem— LinkedIn made up for their shortcomings.

The duo recently advised a Mumbai-based digital media firm, which was on the lookout for a strategic investor. They zeroed in on three potential suitors from the media space in Europe with the help of LinkedIn’s networks. The Bangalore boys who arranged capital for ace tennis star Leander Paes’s sports startup and advised industrialist Rajeev Chandrasekhar’s buyout of Axis-IT&T, among others, say it would have taken them a decade to reach the present level of networks and relationships had their approach been conventional.

“Even now, more than half of our business development happens through this social networking site. Investment banking, as you know, is a relationship-driven business,” says Srinath.

This stuff might be new to a Nano launch, but an old-school car company Maruti Suzuki India is, strangely enough, a pioneer in online social marketing. Realising that there are several online communities for the highly popular Swift, it has created an online platform to bring together the 2,500 disparate online Swift users clubs in India. Earlier this year, the company actively enlisted bloggers and talked to the community during pre-launch activities for its latest Ritz.

No surprise that all of this is old hat to tech-savvy Nokia India. When the Indian arm of this Finnish phone company recently launched its latest—and greatest—device, the N97, it decided to fly down the Chief Designer, Nseries, Axel Mayer for the launch. While Mayer met with some mainstream media organisations, Nokia also organised specific ‘Bloggers Meets’ for Mayer in Bangalore and Delhi. “We have to have good online social strategy because people are visiting those sites. Plus, we also are promoting online social services from our devices,” says Taneja. The result? Tons of buzz generated around the N97 on blogs and on social sites by Indian users.

Trawling the Net can be useful for other reasons than just monitoring brand activity or engaging in customer outreach. A company can often find a goldmine of information about its existing as well as older products which can be incredibly helpful for both the company and existing customers—say, for example, a user manual for your ancient Nokia phone from four years ago which will show you how to transfer your directory onto your laptop. “On the social web there is a lot of ‘metaknowledge’, that is knowledge in the form of blog posts, comments, pictures and videos that is tremendously useful to many companies but these companies are often outside the loop. Now, they want to leverage that knowledge and try and form a community around it,” says Narendra Nag, Founder, Gray Matter, a technology consultancy.

Sometimes these kinds of ‘metaknowledge’ can date back to the origins of the Internet itself and still remain hives of activity, again providing companies with valuable outreach possibilities. “We did a project for Lenovo India earlier this year which involved reaching out to these communities and not just the high-profile networks,” says Karthik S., Account Director, Text100, a public relations consultancy.

Social media, however, has already run into a problem of plenty. Today, there is a surfeit of information from blogs, communities and tweets and blog aggregators such as Technorati, Alltop and BlogAdda— while not social media sites themselves— provide neatly organised silos by topic which make it easy for people to find information on social sites.

Consumer outreach over social media

A Maruti car

Maruti Suzuki

Maruti Suzuki has been a pioneer in the digital marketing space, but somewhere around 2007, it started to get actively involved with social media. Recently, the company actively seeded forums, and social networking sites with news about the upcoming launch of the Ritz. The Tata Nano team has been even more social media savvy—interacting with large member groups—both official and non-official—on both Orkut and Facebook.

“Right now the actual number of users on media might be low, but their influence is far-reaching. Besides, who can predict how many and who will use it tomorrow,” says Shashank Srivastava, GM, Marketing, Maruti Suzuki.

Nokia

Finnish mobile company Nokia has made social media a cornerstone of its marketing strategy in several markets for its Eseries and Nseries premium devices, according to Vineet Taneja, Director, Marketing, Nokia India. To promote its new E75 device with its own e-mail service, the company set up a community website where members could contribute and talk about e-mail and help each other. Nokia also created accounts on Orkut, Twitter and Facebook to promote its device. In addition, the company set up a “shoutbox” where people could write comments and send queries to it, which would then be answered by experts.

“Many people do a web search before they buy a product, and this is why we feel having a social media outreach where we can intervene and answer queries helps,” says Vineet Taneja, Director, Marketing, Nokia India.

Can Advertising Work? Reaching out to customers is one thing but Apollo Hospitals has gone one enterprising step further, by using the Internet to advertise its services in an engaging and novel manner. The company has caught the eye of medical “tourists” worldwide by uploading videos about its procedures, on video sharing site YouTube—the company posted its first clip in October, 2008 where a foreign patient spoke about his experiences at the hospital.

This has several advantages: It is completely free, with a mass reach; it is devoid of company-controlled jargon, presenting a far more effective, “honest” and “true” account of a patient’s experience (caveat: we’re not sure whether he received a discount on his procedure for plugging Apollo); it is also far more targeted than an advertisement on TV. Still, it is risky. One whiff of a staged “confessional” can cause potential customers to avoid the hospital like the plague. Since its maiden video voyage, the number of such Apollo clips has mushroomed to nearly 30, and the hospital has also set up a Facebook group, joined Twitter, added a del.icio.us account and several blogs. Timesofmoney—an online payment solution provider—is also using a combination of blogposts, Facebook and LinkedIn to attract new customers.

Of course, if Apollo’s unique promotional concept doesn’t quite work for you, traditional advertising on social networks such as Orkut, Facebook and LinkedIn (there is no advertising on Twitter, as yet) just might. “Google AdWords customers can actually enable Orkut automatically for their campaigns via Google AdWords itself, through a click of a mouse,” says Shailesh Rao, Managing Director, Google India. However, “in this option, there is no guarantee to advertisers that their ad will show. The other option is for advertisers to actually ‘reserve’ ad slots on Orkut and they can specify day slots when ads have to appear—much like TV. This carries a pricing premium,” he adds. Krista Canfield, spokeswoman, LinkedIn, a professional networking service, says that her company is now also serving up adverts to Indian users which can be directly targeted based on their professions.

Social media sites are not just about a company-customer relationship. It can also be a vital tool in meeting the right kind of professionals, obtaining more real-world career advice than your garden variety headhunter and best of all—find you a job! LinkedIn has been a true phenomenon in India. Scores of executives have been placed using the social network. In fact, after the US, India has the largest membership— around 2 million—of the service’s 41 million members. Several “Groups” have also been formed by Indian companies, professionals and educational institutions. “Groups are a terrific way for members to keep their skills sharp by engaging in discussions and finding answers from other group members. They’re also a great way to build new relationships or rekindle old ones with former colleagues. Groups also provide a wonderful way to stay in tune with industry trends or new happenings at your alma mater or past employer,” says Canfield.

Image management

Vishal Mehta, Group CEO, Vaishnavi Advisory Services

Vishal Mehta, Group CEO, Vaishnavi Advisory Services

Nowadays we do an audit for companies about their perception on the web—just as we have been doing a media perception study for clients over the years. The web study looks at everything—what is written about the company in blogs as well as social networking media, etc. Apart from that we also do a constant monitoring service for what is being written about the company on the web on an ongoing basis,” says Vishal Mehta, Group CEO, Vaishnavi Advisory Services.

“Hospitality companies are particularly vulnerable —as people check on the web for hotels or resorts that they are planning to visit,” says Mehta.

Fighting Fires: Social media is also becoming the centre piece for a critical, sensitive and strategic role involving reputation management of brands and companies. A leading Indian company, which preferred to remain unidentified, discovered this the hard way when it was hit by a slander campaign in January this year, followed by unusual trading activity in its stock. Even as this company voluntarily sought a probe by the market regulator and offered to be open for a peer review, it got to work by seeking to counter every allegation and doubt raised on the various social media forums on which it was being discussed. Its strategy was to foment a debate around its experiences rather than be held hostage to a one-way conversation. “We were monitoring nearly 80 to 100 blogs and we changed the indexing on Google so that it would allow people to also look at a counter response and that way open up the dialogue for a two-way information, rather than just a one-sided view to perpetuate among people,” says Mahesh Murthy, Chief Executive, Pinstorm, a digital marketing firm.

Another company—a leading player in recreation space—had a similar problem and countered with an almost identical response, when confronted with some scathing reviews of a customer of one of its services. “The person had carefully optimised all the online search for the brand name that would direct people onto his page,” says V. Ramani, Vice Chairman, Ignitee Digital Solutions. However, diving into the fray and altering the Google indexes so that the company responses to the allegations would pop up first could have backfired. “We advised our client that this had to be a slow, thought-out process and it would be dangerous to start aggressive counter moves as it would put many people off. We eventually worked to resolve all the doubts that people aired and it ended well,” he adds.

Avoiding Traps: Still, be warned: social media isn’t for everyone and should not be used for everything: For instance, Wipro’s Chief Marketing Officer Jessie Paul explains that online social media is not an ideal platform for business to business (B2B) interactions. “It is a great way of getting messages about your company across but I would neither buy nor would I sell anything using social media,” she says. Also, having a presence in online social media or running ads there doesn’t mean that the company will emerge an overnight success. In fact, far from it. “It is a misconception among many that this is a procedural thing, which it’s clearly not. It is a highly creative space that requires that marketers identify the space, the nature of stakeholders involved, what makes people tick within that space and, importantly, to listen to people—and not try and sell things to them,” says Ramani. According to experts, the biggest mistake that anyone can make is to use the medium to push their products.

Another problem is that of measuring success. Even though there are advanced analytical tools available on the Internet, classifying a “successful campaign” in social media is extremely difficult and can also be manipulated using something called “click fraud”. There are few benchmarks to measure success online unlike television adverts (as we show later in this issue). A company can claim any number of sign-ups for a digital campaign, but never release how many were translated into sales. Also, beware of social media experts. The landscape is littered with them, many of whom have no legitimate professional experience in the field. Much like the Internet company era, social media is the new in thing and these hucksters are simply surfing the next big wave, hoping to get rich.

Before you hire anyone for a social media function, ask them to list specific projects that they have worked on as well as a focussed, detailed plan. Also, social media involvement for a company involves coherent strategy and needs to be executed by someone who understands the company’s ethos and brand promise. In fact, several of the companies we spoke to have full-time employees or had hired professional public relations consultants who monitor social media sites. As such, while the tools of social media might cost nothing, an integrated social media campaign will most definitely have a price-tag. Finally, a badly executed social media campaign might end up being as damaging to the brand as a good campaign is beneficial.

In the early days of the Net boom, before the Nasdaq tanked and blew everything to smithereens, the adage bandied around was “If you’re not there, you’re square,”—“there” referring to the Net, of course. This could be equally true for an Indian business— but this time, it doesn’t involve ideas for a phantom company with no products or revenues. Instead, companies today have a very real way to gain customers, manage their brands, and counter criticism using online social platforms. Business professionals can network with peers, benefit from career advice, get new jobs, make friends and influence people simply by logging on. Somewhere up there, Gutenberg is probably smiling.

- With Shamni Pande, Rahul Sachitanand, Suman Layak, E. Kumar Sharma, Anamika Butalia & K.R. Balasubramanyam.