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Show me the money… not the smiley faces.

When I was interviewing Nathan Gilliatt a few months ago for a webinar we were doing for our clients on the basics of blogging, he introduced me to the importance of online communities. I felt so strongly that he was correct about online communities’ importance in the social media landscape that I recommended incorporating a session on online communities at Office 2.0 and had Dion Hinchcliffe host the panel. A few weeks ago, I serendipitously stumbled upon a Social Media Club of Austin meeting on Facebook where Dell managers were going to be presenting their blogging and online community experiences. Caroline Dietz, the online community manager for Dell’s IdeaStorm gave a good synopsis of how the community is harvested for new product ideas and improvements for Dell. I had the opportunity to spend a few moments afterwards talking to Dell’s chief blogger, Lionel Menchaca, which I really enjoyed.

The one question I managed to get in during the open forum that I felt was obligatory was related to how measurable an impact has Dell’s social media strategy been on Dell’s business–in material (read:financial) terms. There was a lot of discussion regarding how the social media strategy is changing the culture at Dell, how customer satisfaction is improving, etc. And, I’ve seen some reports on the before and after social media at Dell. But, I couldn’t resist the opportunity to ask a public company if this social media razzmatazz has really made, well, a serious difference in the company’s affairs. It’s so easy to be seduced by this technology and to see it working for startups and small pilots, but large public companies have weighty issues.

I’ve attended enough investor analyst conferences, and I’m wondering can Dell’s social media strategy help Michael Dell the next time he’s in front of Citigroup’s Richard Gardner and he has to explain why Dell has fallen from the #1 PC maker to the #2 PC maker worldwide? Better– can Dell’s social media strategy play a role in regaining Dell’s market leadership position?

NYTimes IDC chartI’m also wondering why in this recent interview (9/7) with Steve Lohr of the New York Times, why didn’t Michael Dell take the opportunity to highlight how the company is effectively using social media to help Dell “get back to its roots” by directly speaking to the customer base (and listening in return)? Dietz’s answer to my direct question about whether there have been any material results from the efforts was more or less, “no.” But, maybe it’s just too early to tell. Menchaca said Dell started the blog in July of 2006, so perhaps the results are not yet measurable in these terms.

I guess I’m just in the mood for some results. There is a wide and growing wider community of experts in the social media space. Perhaps there is solid data on this that I have not seen. Something we’ve been discussing in the Enterprise Irregulars group is how social media and enterprise 2.0 differ which would account for it having slipped my view, but that topic is a post for another day and probably involves taking a crack once again at the arbiter of all 2.0 legitimacy: wikipedia. Not sure I’m in the mood for fighting with the wikipedians.

The session with the Dell folks was interesting, despite my growing impatience for iron-clad case studies of 2.0 in business success. I learned a lot, actually. John Moore, a leading marketing consultant, blogger, and author of Tribal Knowledge, was in attendance at the SMC meeting. He videotaped parts of the event and posted these copious notes on his blog:

re: Dell’s Social Media Goals
1 | Enter into conversations with customers everyday in every major language
2 | Address any form of customer dissatisfaction head-on knowing that not everything will be solved and some of Dell’s weaknesses will be exposed
4 | Encourage “crowd sourcing” as the next step in listening to customers
5 | Use video to personalize the Dell story
[John Pope, digital media senior manager]


re: Dell’s Beginning Blogging Efforts
Contrary to perception, Dell didn’t start blogging because of Jeff Jarvis. However, Jeff’s rants did help Dell realize there were customer service issues the company needed to address.In April of 2006, Michael Dell charged Dell to proactively find dissatisfied customers in the blogosphere and connect them with someone at Dell who could help them. By July, Dell had launched its blogging efforts.Dell stumbled with the initial launch of their Direct2Dell blog. They listened to feedback on how to improve it, namely adding links in posts linking to other bloggers. Dell adjusted and in some cases apologized for making a mistake.
[Lionel Menchaca, digital media manager]


re: Changing the Tone of the Conversation about Dell
At the low point in 2006, Dell calculated at least 50% of the online conversation about Dell was negative. Today, Dell calculates the negative online conversation percentage number has been reduced to 23%. Dell doesn’t attribute all its blogging efforts to stemming the negative online conversation, but they are confident that blogging has helped.
[Lionel Menchaca]


re: “Wins” in the Blogosphere
90% of the time Dell enters into a conversation, it “wins.” A “win” happens when (a) you enter the conversation and just thank someone for giving their opinion and (b) when you weigh-in on a negative thread with clarification of facts and the negativity subsides.
[John Pope]


re: Dell’s Process for Posting on the Direct2Dell blog
Lionel serves as “editor-in-chief” for the Direct2Dell blog. As the editor-in-chief, Lionel balances three areas when it comes to topics the company chooses to blog about:
(1) content/ideas from Dell’s cadre of bloggers
(2) comments from Direct2Dell readers … if a topic emerges from readers, then Dell knows it needs to blog about that topic
(3) the need to add Dell’s voice to an online conversation that directly or indirectly impacts Dell.
[Lionel Menchaca]


re: Moderating Comments
Dell moderates comments on the Direct2Dell blog. On busy weeks, Dell receives up to 400 comments. Well over 90% of those comments get posted following a quick look-see. Dell uses common sense guidelines when deciding which comments to moderate. Dell’s three common sense rules are:
(1) No profanity
(2) No direct attacks on Direct2Dell readers
(3) Anything addressing legal issues are not posted,
[Lionel Menchaca]


re: IdeaStorm
The Direct2Dell blog changed how the company viewed online customer conversations. In the past, Dell wasn’t comfortable with participating or reacting to the conversations happening online about the company. However, the company now understands the importance of participating and reacting to the online conversation … so much so that … directly soliciting ideas from the online community was the next step in Dell’s social media strategy.In Febuary 2007, Dell launched IdeaStorm — which is, simplistically speaking, an “online suggestion box” inviting people to offer ideas on how Dell can improve its products and services.One unique aspect to IdeaStorm is Dell is now able to close the loop with feedback from customers. When customers post ideas on IdeaStorm, Dell is able to follow-up with posts/comments explaining that the company heard them and explain what Dell is doing in response.Dell views IdeaStorm as a way its product development team can co-create products with customers. Pre-installed Linux on Dell computers was one of the first ideas generated from IdeaStorm that Dell product developers worked with customers to co-create and introduce to the marketplace.There are about 35 other ideas Dell has put into action as a response to listening to feedback from customers on IdeaStorm.
[Caroline Dietz, online community manager for IdeaStorm]

re: Lessons Dell is Learning from IdeaStorm
While there have been many successes with IdeaStorm, Dell is still adapting to how this initiative is changing the culture at the company. Being more transparent and sharing company information isn’t a cornerstone of the Dell corporate culture. However, IdeaStorm requires a certain comfort level with being open and forthcoming that Dell employees are adjusting to. Clearly, Dell’s participation in the online social media world is having an impact on its company culture.
[Caroline Dietz]


re: Dell EmployeeStorm
As a result of the success IdeaStorm has had in generating ideas from customers, Dell has launched EmployeeStorm to generate ideas and comments from its 88,000 employees. A by-product has been employees are learning to become more comfortable sharing ideas and adding comments that they are now more willing to participate in IdeaStorm.
[Caroline Dietz]

Discussion

5 comments for “Show me the money… not the smiley faces.”

  • Pingback: links for 2007-10-27 « Wizard of IdM’s Weblog

  • Paul Hubert

    My thanks as well, Susan. As an IdeaStorm diehard participant from nearly its beginning, I continue to press Dell for greater interaction with the site. Anyone would realize that ‘social media’ is no panacea, but company attitude, commitment and culture change might well PROVE to be.

    Success in a competitive environment can be measured and achieved in different ways. HP once had a reputation for rock solid hardware: reliability was their hallmark. In our times of commoditization, perhaps that is more difficult to achieve. Still, Toyota (have they recently slipped?) and Honda built similar reputations.

    I vote for positive and strong customer relationships. I’ll continue to watch Dell’s progress, while offering my $0.02 worth now & then. So far, I would say their effort is amazing and has the potential to set a most valuable precedent.

  • http://susanitsa.wordpress.com/ Susan Scrupski

    @John – Thanks so much for dropping by. I was having an nice chat about Dell yesterday with a social media maven. Clearly, Dell is on the right track with social media. I wish we just would see a little public endorsement of Dell’s pioneering efforts coming from Dell’s executive ranks. This would help pave the way for others, so we can get the evangelizing out of the blogosphere and into the board room where it can make a real difference in accelerating adoption. Although contrary to the philosophy of 2.0ers, the truth is one strong CEO endorsement still weighs heavily among his/her peer group. Now, if he only had those turnaround numbers inarguably linked to the social media strategy…

  • http://brian.magierski.com Brian Magierski

    Susan – I share your frustration with the iron clad case studies. To be sure, there are a few that we’re all aware of for the most part – GoldCorp (re: Wikinomics), P&G using Innocentive, etc. As I’m out presenting to and meeting with some companies on the topic of Next Generation Enterprise transformation, once we get past the trends and studying the adoption of 2.0 technologies by consumers, they are drilling in looking for case examples. I do believe per the comment above, making social media work with business requires commitment and a paradigm shift for many companies.

    I believe the case studies will come, but right now my sense is the early adopters that will drive these case studies are experimenting and getting small wins. When they take those experimental wins and scale them, the real case studies will emerge. Right now I’m beginning to believe the search for case studies effort is about finding those early indicator experimental wins.

  • johnpatdell

    Hi Susan,

    I really enjoyed your post and have to say that although Dell is committed to make social media work from a business perspective, it isn’t a magic bullet. We also realize the need create compelling products that are available in more and different places, and a consistently excellent customer experience at every touch point. We’re working hard on all these things, and more. But we have seen measurable results and I’d like to reiterate what was reported above: When we started our social media initiates in August ’06, our online word of mouth was 48% negative. As of last week it is 24%. Is all attributable to social media? Of course not. But we believe we’re on the right course for what will surely be a very different marketplace sooner than later.

    Might want to check out what Geoff Livingston over at the Buzz Bin has to say about the dynamics of social media adoption — in short there are no quick successes but there can be negative implications for corporations that do not adapt. http://www.livingstonbuzz.com/blog/2007/10/08/corporations-have-anti-social-cultures/

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About Me

Susan  Scrupski

Susan Scrupski

Changing the world of work.

Tirelessly working to foster new thinking and behaviors in global enterprises.

Susan Scrupski founded the The 2.0 Adoption Council and Change Agents Worldwide.

Also writing a book about none of the above.