business today & tomorrow

I’ve been asked to speak at a panel at EGR Live (eGaming Review brand) covering the topic ‘Marketing on a shoestring budget’. My role on this panel is as ‘someone who knows about social media’… and it got me thinking.

Everyone loves seeing an underdog make it. And in marketing land an underdog is someone with little or no budget. So when Paranormal Activity, a movie with a production budget of $10,000 and no marketing budget, makes it into American theatres through an active approach to social media, we pay attention, we pay attention and we want some of that magic too!!!

I love stories like this, but I fear that it gives people the wrong impression of the role that digital and social media should play in marketing.

Marketing does not = advertising, we must therefore look at marketing from a broader perspective

The main reaction marketers have when they think of marketing on a shoestring budget is free advertising, and the solution to this is social media and SEO.

This is a limited view of marketing. If, as a marketer, you truly want to decrease marketing cost you MUST look at marketing from a broader perspective. If, as a marketer, you truly want to be part of the social media tidal wave you MUST look at the role digital and social media can, and should play, in the entire marketing mix.

Some companies are getting this right, and ‘qu’elle surprise’, they are also the same companies we keep reading about in the trade press and hearing about at conferences. The reason they’re such success stories is because they do NOT look at social media as a way of decreasing advertising budget, they look at social media (and with this I mean the power of people) as something that can affect their entire marketing mix. Let me give you some examples, and I know you will be familiar with these.

• Product development: LEGO with its software ‘Design By Me’ allowing people to design their very own custom made LEGO sets
• Price: Open Source Foundation with its promise of being better quality, higher reliability, more flexible at a lower cost
• Distribution: Kogi BBQ has several trucks serving Korean food in LA and uses twitter to tell its customers where they can find their van’s each day
• Service: Best Buy the electronics giant won new business online by doubling its investments in customer care initiatives, making improvements to its Web site, and driving customer engagement on Facebook and Twitter
• Promotion: (the aforementioned) Paranormal Activity

And finally Zappos, a company who gets it right throughout the value chain, has during the past 10 years grown from almost no sales to more than $1 billion in annual gross merchandise sales. This has been achieved primarily by repeat customers and word of mouth.

These are all examples of excellent marketing, and in some cases of advertising on a shoestring budget!

Create an army of fanatics

There is another thing these companies have in common; they have what Jonathan MacDonald, my business partner at this fluid world, refers to as an army of fanatics supporting them. An army of fanatics are people that produce and create for you, talk about you, promote you, sell your products, and in tough times defend you!

Shift marketing investment to earlier stages of the value chain

When we at this fluid world work with organisations that are looking at decreasing their marketing budget (often through social media), we recommend that they shift their investment to an earlier stage of the value chain, in addition to focusing their attention on creating an army of fanatics, rather than on how to advertise as cheaply as possible. Why? Because we know that this will save organisations money across the board.

We recommend:

1. They tap into the zeitgeist “the spirit of the times”, soak themselves in the cultural and spiritual climate, live breathe and eat what people do, think and talk about
2. That they create extreme value, be it in utility, convenience, enablement, connectivity, coolness or reward; within and around everything they do. This can only be achieved if stage one is taken seriously, and done well
3. After having created something extremely valuable make sure it’s ultra findable. The distance between inspiration and satisfaction must be reduced toward instantaneous. Be everywhere! Yes this is where search comes in – but only as a part of it
4. And finally make sure it’s super shareable. It seems such an easy concept but the efficiencies of distribution become significant when people who like something can share it with others. The ‘viral’ campaigns we see working best are those that have an instant way of sharing between people. This accelerates the advocacy effect of armies of fanatics

Gaming is all about armies of fanatics

As you can imagine, creating an army of fanatics is easier said than done, especially if you’re in the business of selling sugar water or you are, for example, an energy company…

But if you’re reading this and you’re in gaming, than you’re incredibly lucky because you’re in an industry that by nature is made up of fanatics! People who game love gaming, people who game breathe gaming! You already have the army of fanatics to tap into by default. They are there, waiting to connect waiting to play (literally!).

So what does that mean to you? It means that your job is to make them YOUR army of fanatics!

Look at Zynga, the makers of FarmVille, and FishVille, with 230 million users each month (using a limited advertising budget) and Mafia Wars with its 12,104,521 facebook fans (as of 2^nd of June 2010). These are games that have created and tapped into fanatical armies at great success!

This, by the way, requires following the same recommendations outlined above. Gaming is the perfect environment for a brand to create THEIR army of fanatics, and for social media marketing to prove itself in every part of the marketing mix.

If the gaming industry gets it right, I believe it could do to social media marketing what porn did to the Internet – accelerate its success!

And for whoever does this well, it will be game, set and match!