Why Mobile Marketing is Way Hotter than Social Media Marketing

(This post was previously published on Talent Zoo's Digital Pivot.)

Goodbye, Wallet.  Hello, Cell Phone.

Sound familiar?

That's how I began my Oct 5th post describing four reasons why it was nevitable that we all would soon be using our phones to make purchases in stores and restaurants. 

But in case you didn't believe me then, the needle on  the marketing Richter scale  got pinned to 'Extreme' last week with three mobile announcements:

• Casting the gauntlet to the VISAs and MasterCards of the world, AT&T Mobile, Verizon Wireless and T-Mobile  announced they are creating a mobile payment network that will allow consumers to pay for items at stores using their cell phones.  Michael Abbott, CEO of the newly formed ISIS joint venture, stated in FierceMobileContent,  "the ultimate goal is the development of a mobile wallet solution that effectively renders obsolete cash, credit and debit cards, loyalty cards, coupons, tickets and transit passes." (Note: Among other players, eg. VISA  and Sprint   have also discussed their mobile payment solutions.)

•  Not to be beat to The Next Great Thing, Google Chief Executive Eric Schmidt provided a sneak preview  of an soon-to-be-released Android phone with a Near Field Communications (NFC) chip that allows consumers to pay for items.

• At Monday's Web 2.0 Summit, Morgan Stanley analyst Mary Meeker's presentation, included a hyper-aggressive forecast:  Contrasting internet e-commerce's 15 years to acheive 5% of retail sales. she predicts mobile e-commerce will get to that same level in only five years or one-third the time.
  

Considering these announcements  alongside other significant smart phone marketing data (eg. the hyper-growth of Apple IOS, the future Facebook Phone, still significant share of RIM Blackberry, others), we're clearly into our first round of chess boxing for the  Mobile Payments Market.

Here are three reasons you might want to stop and  consider getting educated on mobile payments marketing with the same ferocity that so many have used in flocking (over-flocking?) to social media marketing:

1. First to the New Greenfield Site Reaps the First Mover Advantage
A smart phone with an NPC chip is clearly a technology  greenfield ripe for market development   Historically, new technology platforms have been the great Wild West frontier for marketeers, where early pioneers reap the first and most visible gains. Think how Dell Computer, Zappos , even the little LA Kogi Taco truck leveraged Twitter in the early days. (This said -- make sure you arrive at the right greenfield site: The 200 MM subscriber klout of Isis notwithstanding, there is plenty risk on which Mobile Payment Network and/or smart phone strategic alliances will win.)

2. Mobile Marketing Job Opportunities are Likely to Flourish
Google CEO  Schmidt has ventured that as many as 500 new mobile payment  startups will emerge associated with the new cellphone-based payment platforms. Obviously, these new tech companies will be forming their marketing A-Teams.

3. The New Mobile Payments Technology will Stir a Tsunami of  Marketing Innovation It seems technology innovation begets  marketing innovation. As historical examples, consider the freemium business model and the  affiliate partner program.  Though each existed in some form well before Web 1.0, (for reasons beyond the scope of this post) both exploded in growth with the rise of the internet.  It's fair to say that the likes of Amazon, still an Internet behemoth today, would not be without such affiliate marketing innovation.

As a more recent marketing example, look at how Starbucks has combined social network technology with crowdsourcing technology.  With  MyStarbucksidea.com, they have dramatically altered and enhanced the flow of ideas between customer and company.

 We expect the same with Mobile Payment networks.

Take a look at  the diagram of the Isis marketing   When all the major points of  a marketing cycle , from initial advertising,  retail location identification, discount coupons, loyalty points to final payment transaction are for the first time co-located on one device owned by one consumer , the rules are surely to change. All the marketing data will have to pass quickly across all stages in order to "fundamentally transform how people shop,pay and save". 

Social media and networks will be very much germane to the  new marketing infrastructure formed within the emerging mobile payments world: After all,  200 million of Facebook's 500 million active users access the service through their mobile device; Similarly, some 62% of Twitter users are tweeting from their cell phones.

As recently covered in MIT's Technology Review,  social purchasing apps are on their way: Giving you some  taste for how appealing that blend of flavors will be, Blaze Mobile Wallet for the iPhone not only allows you to pre-pay for a movie ticket from your phone, but informs your friends via  Facebook of the the film, theater location and show time. We ain't just singing Kumbaya here: The value of one transaction may well be marginalized by the dollar-value of the social connectivity (aka the multiple transactions associated with your friends joining you at the movie).

Now don't get me wrong: I realise a significant number of you are knee-deep involved with social media marketing. 

I am not saying that social media marketing is a bad place to be. After all, only a couple of tech cycles ago, it too was a massive greenfield opportunity.  But that's also social media marketing's  main problem: It's THE current place to be.

Canadian hockey player Wayne Gretzky put it well. A good hockey player plays where the puck is. A great hockey player plays where the puck is going to be.  

Five Schema-Busting Slides for Moving CEOs Beyond Search to Social

As Valeria Maltoni (@ConversationAge) put it so well in a recent post describing the increasing adoption of social media "marketers are finally putting their money where our conversation has been -- integrating social with their activities".

Even so, as a marketing consultant to smaller companies, I am approached by client firms that are still resistant to the "sea change" in the air. Frankly, some are still operating with 2007 market data (and schemas) in their heads. So it is I find myself called into executive strategy briefings and staff meetings and given a short time slot to plead the case for adopting social media.

Perhaps you know the drill?  Fifteen "make it or break it" minutes to stand and present, survive a firing line of questions and, hopefully, actually survive long enough to open the door to discussing the company's own social media strategy. Catch: There's not enough time to show the Social Media Revolution video.

What I've found works very well in such situations is to have an opening set of market research slides, "schema-busting" slides I call them, which set a big picture marketing context, highlighting that our former Google-centric view of the online universe of the past decade is changing.

Yes- I refer to the ROI of Dell's social media use, Zappos, the brilliant customer service case studies of Comcast, the product innovation crowdsourcing by Starbucks, the even more brilliant crowdsourcing experiment by NetFlix  and many others. However, too often, there can be a NIMI (Not-in-My-Industry) attitude that raises objections. So I launch usually with a more macro view of recent significant data. The sole purpose of these schema busters is to establish that significant changes are underfoot which require an alteration of the current marketing strategy, a realization of that "Ignore at your own peril" moment.

After all, why else would I be advocating a marketing strategy change?

Lately, I've had good results using the following slides.

Slide 1.

Social Media Sites are now among some off the top web properties. Dramatic changes have taken place since 2007.

Compete data | Erik Qualman's Socialnomics slideshare

There's no sense in being taken down on the first serve. As they say, begin on an unassailable point. Starting off with  Compete, Quantcast or Nielsen data -  authoritative market and web researchers - does just that. So I start by borrowing this slide from Erik Qualman's Socialnomics slideshare which shows Compete data to show that social media has changed significantly the top visited places on the net - places where people are sharing photos, product recommendations and links to articles with friends and colleagues. (Perhaps not the best time to point out that  'adultfriendfinder' will soon be replaced by Chatroullete though.)

This simple slide forces the conclusion " Dang, major tectonic shifts  have happened since 2007." More importantly, it forces the question," Maybe we should revisit our strategy?"

Slide 2.

People online now spend 7 hours per month "friendcasting".

This is more time than spent on search engines Google & Yahoo, as well as MSN and YouTube combined.

In a sense there's nothing really shattering about the data actually as it reinforces what we've always known, Word of Mouth is the most powerful recommendation driver.

You can make a similar point by referencing Compete's latest data in terms of "attentional time" market share, shown  in a more visual format.

Slide 3.

Facebook Commands More "Attentional time" Market Share than Google or YahooSource: MarketingCharts, Feb 2010

What's cool about these last two slides is that they now set the stage for you to raise the question: Would you like your company to be part of this 7 hour per month conversation, one which is rising in attentional market share? Be part of the shared photos? The shared articles? The product reviews and recommendations?

Slide 4

Facebook is Besting Google in Driving Traffic to the main portal sites.

Based on data from Compete, Feb 2010

Compete Inc. and their director of online media and search Jessica Ong ignited a powder keg in revealing this data during a late February interview with the San Francisco Chronicle,

I say "powder keg" as this data ignited considerable reaction from within the SEO community. So be advised, Search and SEO aficionados within your audience may also take issue, especially as that group commands the lion's share of the digital marketing spend today. (It may help with any tumult here to say, to those who dispute that Google competes with Facebook and Twitter that more recently Google lists both as competitors in their latest 10-K report. )

Slide 5.

Social Networking is Passing Search in Driving Referral Traffic

Source: Compete January 2010

I first saw this slide just days ago during an enlightening presentation by Gigya CEO, David Yovanno at Gigya's "Social is The Next Search" webinar. While I've not actually used this slide yet, I will as it really delivers the coup de grace. In fact, if you only have one slide to show - this is it.

That social sharing is outdistancing search in referral traffic was pointed out earlier in a prescient blog post by ReadWriteWeb's Marshall Kirkpatrick. He wrote

What would it mean if social networking over-took search in terms of sheer visits online? It would mark a sea-change on the internet. No longer would our dominant use of the web be seeking out web-pages built by HTML web-masters! Now we would all be publishing tiny little updates that perhaps only our friends and family care about. We'd be subscribing, more than we ever did by RSS, to syndicated updates from organizations of interest, large and small.

There's no doubt: there's an increasing intersection between search and social sharing. But perhaps it isn't that people are changing the way they search,  so much as their friends are changing the way they find things. One of the more important questions you can open up at this point: Is the digital marketing spend allocation for social media vs search adjusted to these new market realities?

So there you have it: Five slides that can all be understood in five minutes. (Isn't it odd that we have to unroll the past conceptions, bust the old 2007 mental schemas, in order to see the best way to meet the future?)

What slides do you find work best to open the door to deeper social media discussions?

Postscript: My title notwithstanding, I am not advocating a wholesale revision of the search vs social media budgets planned. Just saying: The relative sizes may not be in line with the most recent 4-6 month marketing data.