Why companies screw up on social media

Filed in archive strategy on July 17, 2010

It's alarming how many companies are moving into social media without thinking it through. And yet if they ignore it, they will run into trouble.

Consider the case, for example, of United Airlines which ignored a passenger who posted a song on YouTube about the airline breaking his guitar. You can read about the case here. It's had millions of web hits.

Writing in BusinessWeek, Felix Gillette talks about how companies are now rushing out, spending lots of money hiring social media experts, for big money, and then trying to work out what they have to do. "Much of the justification for the corporate spending, however, is anecdotal. As company chiefs find themselves chasing another new, new thing in the digital world, they are doing so as much on faith and emotion as on metrics and case history."

The extraordinary part is that this sort of work did not exist five years ago. But they're not doing it that well. As we read here, most World Cup sponsors failed to do anything with social media during the world's biggest sporting event.

Search engine optimization expert Hugo Guzman shares some insights into what they can do better and where they are going wrong.

Number one mistake is failing to create scintillating conversations between your brand and the customers. Another big blooper is thinking it's about buying ad space (that's called media buying). Treating it as a popularity contest or broadcast medium is wrong too because consumers just tune out. And probably the worst mistake is to forget that social media makes it a two way street. Social media is similar to telephone or email. It means you have to spend more time listening and engaging.

For all the money corporations are spending, social media is still a foreign country. They don't understand it. If corporations want to use social media effectively, they will have to start listening to their customers. Very few do that.