To paraphrase a book review of Lord of the Rings, the English-speaking world is now divided into two – those who are part of Facebook and those who will be. If you’ve been wondering what the fuss is all about, Facebook is essentially social networking done right. The developers have cleverly isolated the key elements that people want from such a website – re-connecting with old friends, keeping in touch and interaction – and pioneered a unique approach to satisfying those needs in such a way that surpasses previous attempts from Friendster, LinkedIn or Myspace.
One may sniff at such an incremental improvement, but one should remember that Google “only” improved upon Yahoo’s search capabilities and look where it is today. Facebook’s global membership has grown exponentially since opening its doors and has reached a roster of 43 million active users after 3 years of operation. Locally, the statistics are also impressive: from virtually zero in the 1st half of the year, the ‘Malaysia’ network of Facebook has grown to 70,000-odd members, and is growing at the rate of roughly 30% every week.
Why Facebook is better
Virtually every Facebook joiner has the same experience – you are bugged by friends to register, you do so, you find a few friends, but soon you are inundated by other friends who have somehow found you and then you spend copious amounts of time “catching up” by reading other people’s profiles. Such is the genius of their profile layouts that a friend you have on Friendster suddenly seems more interesting when he’s on Facebook!
Secondly, Facebook is an uncluttered environment which emphasises what its membership base most wants to do – stay in touch. It consistently strikes a satisfying balance between privacy for oneself and curiosity about others. In Facebook, a member’s home page is a veritable news feed of all the important things happening to his community, and similarly every significant action or comment you make on Facebook is reported to your community. Are you getting engaged? Got a new job? Having a tough day? Or just simply going some place tonight? One brief update and *click* all of your friends will know.
Thirdly, Facebook structures interaction through the sharing of hobbies, games and interests. It has cleverly outsourced this to 3rd party developers who create applications on the Facebook platform that integrate well into the user’s profile page.. Whether its music, games, hobbies, religion or others, all have applications which automatically seek out those friends with the same interests. The combination of such applications, on top of Facebook’s already potent user-generated content, creates a compellingly “sticky” environment where half of all registered users log on daily or more just to see what is going on in their world of friends.
Marketing Implications
But what does this mean for marketers? Google rewrote the book on web advertising with its AdSense application and its promise of targeted advertising leveraging on its ubiquitous search engine. What about Facebook?
In its current embryonic stage, Facebook may best be understood as word-of-mouth writ large. Any campaign with a viral marketing component has to consider Facebook for efficiency reasons. Case in point: an expatriate’s leaving do was recently held at a Mexican restaurant on Jln Semantan. I know this because I was notified in my community news feed that a friend of mine attended it. The point is, its not just the invitees, but all the friends of the invitees that now know there’s a Mexican restaurant on Jln Semantan. Do they serve grilled fish tacos there? I don’t know, but I’m certainly going to find out.
Furthermore, Facebook aspires to bring some demographic order to web advertising. Although as a user it is possible to have a blank profile up, half the fun is actually sharing what your interests are and what you do. That translates on a massive scale to a potentially powerful meta-database for larger advertisers. Facebook is holding out the promise of targeted Internet advertising that does not rely on search for the targeting but rather location and demographics – a long-held dream for advertisers who want a more active campaign rather than a passive keyword-based one such as Google’s.
Finally, Facebook is being seen as a poster boy for Web 2.0 with its infrastructure for shared web applications, and is in fact being spoken in the same breath as Yahoo or Google when it comes to that coveted ‘portal’ status. With the 6th most trafficked website currently in the USA, it is no wonder, then, that the shareholders were offered US$1.6 billion for the company by Yahoo and still had the gall to turn it down. Its early days yet but the future of web advertising may again be turned on its head by the Internet’s newest kid on the block.
(reprinted from The Sun, 10th October 2007. e-Paper link here.)
Wednesday 10 October 2007
Sunday 7 October 2007
Dealing with Fear and Greed in Marketing
A very senior sales professional once wrote to me, when I was a wee trainee fresh out of school, “Fear and greed motivates almost all buying behaviour. No, wait, that’s wrong. Take away that word ‘almost’.”
Many of you must have heard one variation or another of that old saw before. Fear and greed are indeed two of the most powerful human emotions, motivators of our actions since caveman days to avoid risk and acquire what looks rewarding. The literature on these two emotional drivers in decision-making is quite lengthy, but it is commonly discussed in the world of investments, less so in marketing and consumer buying behaviour.
Is it true?
Do we truly buy things only out of greed or fear? Throw all kinds of products up in the air and you do find that they fit… if you stretch the concepts of fear and greed a little (ok, a lot). Rice, bread, cooking oil, milk and other necessities? Yes, we buy such necessities out of fear of running out of them. Computers, handphones and laptops? Sure, we buy them out of ‘greed’ for the latest gadgets and what they can do for us. Luxury cars, yachts and planes? Classic greed. Insurance, home alarms and vitamin supplements? Classic fear. The list goes on and on. Try it with the product or product category your company operates in, and you will find fear and/or ‘greed’ is around the corner in some guise or another as a simplification of the buyer motive. (perhaps ‘acquisitiveness’ would be more euphemistic instead of ‘greed’?)
New perspectives on Fear and Greed
If you accept that these two primal emotions play a huge part in consumer buying behaviour, a new book taking a neuroscientific look at fear and greed and their effects on investing may have some valuable lessons for marketers. Jason Zweig’s “Your Money and Your Brain” (Simon and Schuster 2007) highlights several important facets of our brains’ reaction to fear and greed, but for the purposes of this column, I’ll mention two.
First, anticipating a reward is much more powerful than actually getting one. This is the ‘thrill of the chase’ which we are all so familiar with, and this thrill is actually much more powerful than the pleasure received when the quarry is ‘caught’. Functional magnetic resonance imaging (fMRI) scans of experimental subjects show that neuron signals fire more significantly during expectations of payouts than they do when the payouts are actually received. This partly explains why lottery ticket sales increase dramatically when the jackpot rolls over week after week – millions of people become excited at the prospect of winning hundreds of millions (as opposed to mere millions) and the lottery ticket sales skyrocket.
Secondly, another insight with regards to fear is our brain’s inability to measure risk in proportion to probability. Instead, explains psychologist Daniel Kahneman, "we tend to judge the probability of an event by the ease with which we can call it to mind." Hence, people tend to fear nuclear reactors much more than sunlight, even though the worst nuclear accident in history, Chernobyl, killed fewer than 100 people, whereas 8,000 people a year die of sun-related skin cancer.
Local lessons
Brain scans and new books are one thing, but experienced business practitioners probably know these things intuitively through experience. What are some examples of local marketing which address these 2 issues of anticipated reward and fear of the improbable?
A recent buka puasa trip to a well-known local restaurant at Mid Valley Megamall was an interesting experience. Mounted around the restaurant were LCD TV’s displaying mouth-watering videos of the preparation and garnishing of the restaurant’s signature dishes, which no doubt helped customers to decide what to order but also definitely whetted their appetites as they waited for their food. Overall, this provided a much more enhanced dining experience.
As for fear of the improbable, you may notice around KL billboards which advertise the services of a cord blood bank. A cord blood bank stores the cord blood of a newborn baby, as it is rich in stem-cells and can be used for life-saving transfusions in the future in case of diseases such as leukaemia and other blood or autoimmune disorders.
The advertisement features a butterfly on the nose of a cute baby boy, with the words: “Don’t let it fly away, mom!” This single picture succinctly draws attention to the ultimate beneficiary of the service (the baby), the fear of letting something potentially precious and life-saving slip away, and, allegorically, the comparative low cost of making sure that precious thing is saved (just catch that butterfly…).
The approaches of both these companies also illustrate that appealing to the emotions of fear and ‘greed’ is not straightforward, and requires subtlety and creativity in today’s consumer market. For instance, in the case of the cord blood bank, the fear of letting something precious slip away was highlighted, which is something everyone can relate to, instead of the fear of the diseases which might strike our children, which would be much too negative in a nationwide advertising campaign.
Interesting? Effective? A final disclosure: I’m both a customer of that cord blood bank and a regular at that local restaurant, so the strategies must have worked on me!
(reprinted from The Sun, 19th September 2007. e-Paper link here.)
Many of you must have heard one variation or another of that old saw before. Fear and greed are indeed two of the most powerful human emotions, motivators of our actions since caveman days to avoid risk and acquire what looks rewarding. The literature on these two emotional drivers in decision-making is quite lengthy, but it is commonly discussed in the world of investments, less so in marketing and consumer buying behaviour.
Is it true?
Do we truly buy things only out of greed or fear? Throw all kinds of products up in the air and you do find that they fit… if you stretch the concepts of fear and greed a little (ok, a lot). Rice, bread, cooking oil, milk and other necessities? Yes, we buy such necessities out of fear of running out of them. Computers, handphones and laptops? Sure, we buy them out of ‘greed’ for the latest gadgets and what they can do for us. Luxury cars, yachts and planes? Classic greed. Insurance, home alarms and vitamin supplements? Classic fear. The list goes on and on. Try it with the product or product category your company operates in, and you will find fear and/or ‘greed’ is around the corner in some guise or another as a simplification of the buyer motive. (perhaps ‘acquisitiveness’ would be more euphemistic instead of ‘greed’?)
New perspectives on Fear and Greed
If you accept that these two primal emotions play a huge part in consumer buying behaviour, a new book taking a neuroscientific look at fear and greed and their effects on investing may have some valuable lessons for marketers. Jason Zweig’s “Your Money and Your Brain” (Simon and Schuster 2007) highlights several important facets of our brains’ reaction to fear and greed, but for the purposes of this column, I’ll mention two.
First, anticipating a reward is much more powerful than actually getting one. This is the ‘thrill of the chase’ which we are all so familiar with, and this thrill is actually much more powerful than the pleasure received when the quarry is ‘caught’. Functional magnetic resonance imaging (fMRI) scans of experimental subjects show that neuron signals fire more significantly during expectations of payouts than they do when the payouts are actually received. This partly explains why lottery ticket sales increase dramatically when the jackpot rolls over week after week – millions of people become excited at the prospect of winning hundreds of millions (as opposed to mere millions) and the lottery ticket sales skyrocket.
Secondly, another insight with regards to fear is our brain’s inability to measure risk in proportion to probability. Instead, explains psychologist Daniel Kahneman, "we tend to judge the probability of an event by the ease with which we can call it to mind." Hence, people tend to fear nuclear reactors much more than sunlight, even though the worst nuclear accident in history, Chernobyl, killed fewer than 100 people, whereas 8,000 people a year die of sun-related skin cancer.
Local lessons
Brain scans and new books are one thing, but experienced business practitioners probably know these things intuitively through experience. What are some examples of local marketing which address these 2 issues of anticipated reward and fear of the improbable?
A recent buka puasa trip to a well-known local restaurant at Mid Valley Megamall was an interesting experience. Mounted around the restaurant were LCD TV’s displaying mouth-watering videos of the preparation and garnishing of the restaurant’s signature dishes, which no doubt helped customers to decide what to order but also definitely whetted their appetites as they waited for their food. Overall, this provided a much more enhanced dining experience.
As for fear of the improbable, you may notice around KL billboards which advertise the services of a cord blood bank. A cord blood bank stores the cord blood of a newborn baby, as it is rich in stem-cells and can be used for life-saving transfusions in the future in case of diseases such as leukaemia and other blood or autoimmune disorders.
The advertisement features a butterfly on the nose of a cute baby boy, with the words: “Don’t let it fly away, mom!” This single picture succinctly draws attention to the ultimate beneficiary of the service (the baby), the fear of letting something potentially precious and life-saving slip away, and, allegorically, the comparative low cost of making sure that precious thing is saved (just catch that butterfly…).
The approaches of both these companies also illustrate that appealing to the emotions of fear and ‘greed’ is not straightforward, and requires subtlety and creativity in today’s consumer market. For instance, in the case of the cord blood bank, the fear of letting something precious slip away was highlighted, which is something everyone can relate to, instead of the fear of the diseases which might strike our children, which would be much too negative in a nationwide advertising campaign.
Interesting? Effective? A final disclosure: I’m both a customer of that cord blood bank and a regular at that local restaurant, so the strategies must have worked on me!
(reprinted from The Sun, 19th September 2007. e-Paper link here.)
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