“Social Media”, Business, and Matchmaking

This is a “part 2″ post, growing out of the principles outlined here in part 1, where we enjoyed a lively discussion about how, in business, social media (or Community Networking/Networked Communications) is part of the larger category of Communications, along with a lot of other traditionally silo’ed disciplines such as PR, Marketing, and Advertising. We also discussed how the usage of two-way communication networks in business will lead to a more relational, rather than transactional, approach to gaining and keeping customers.

Now let’s turn to another fundamental perspective. This one has a lot of tentacles so we’ll try to outline a general principle here, and then we can carry on in the Comments. I believe that healthy business<–>customer relationships will increasingly be marked by a matchmaking approach. That is, we can steadily shift from a view of the potential customer world as a mass of demographics, and the potential supplier world as a bunch of faceless commodity providers. The first questions in a provider’s mind should no longer be, “How can I get MORE customers?” “How can I reach MORE of my target audience?” “How can I get my numbers up?” We should shift to, “How can we use networked communications to find the right people for whom we are the right fit (and vice-versa)?”

Let’s take a simple analogy, from the social media world. You can use Twitter as a “follower accumulation engine”, and in a few month’s time have thousands of subscribers, but how many of those are really a “match” for your interests, perspectives, business direction, resource needs, etc.? In social media, as in life and business, you’ll find that a relatively small number of folks are a “fit”, and when you spend time cultivating them, they will help you find others who fit.  Some business owners pursue anything or anyone that will be a revenue producer, but I’ve learned over the years that “not all business is good business.”

Customers, too, are overwhelmed by choices, and gladly latch onto for providers of goods and services that are a good “match” – companies that make them feel like they’re getting consistent value, and that make life simpler by taking one more decision off the table. And now, with great social networking tools, many of these winning companies can have a “face” and carry on a dialogue with potential and existing customers, which strengthens the sense of relationship. If I have found a great “match” for, say, an on-line bookkeeping service, then I don’t have to think about who to use next time – and, I very readily pass on my recommendations through my network, especially if I feel like I’ve come to know the supplier more personally.

Of course, all of this has been going on before the era of web-enabled social networking – but the importance is much greater now, and the capacity to weave matchmaking into the equation (from both sides) is wonderfully expanded. There are one-time buyers, there are occasional customers, and there are matches. Businesses should be aggressively using networked communications to identify and invest in the latter, rather than constantly trolling for any new revenue that can be found. The customer network thus built will, in the long term, generate far more new and repeat business. It will even give you the luxury of “firing” unprofitable and troublesome customers (b-to-b or b-to-c).

What do you think? How do you weave a matchmaking perspective (and practices) into your business model?

Matchmaking is not merely employing a set of business tactics and tools. It’s a mindset. It can also be the foundation for an entire business model, which will be the subject of my final post (part 3) in this series, on Marketing Profs DailyFix.

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About Steve Woodruff
Steve Woodruff is a blogger, a Connection Agent, and a consultant in the pharma/healthcare industry. He specializes in helping people and companies make mutually beneficial connections.

7 Responses to “Social Media”, Business, and Matchmaking

  1. Tom Martin says:

    Steve

    A good follow up post. I always say, “not all dollars are equal” and I think you echo a similar thought here. I love the idea of matchmaking.

    The difficulty of matchmaking though is patience. Matchmaking is by definition a slow growth strategy that once perfected results in a far more profitable strategy if for no other reason then it lowers your mass marketing costs down the line. But matchmaking takes time and energy and companies will need to factor that into the equation.

    I’d say the best, or maybe the most realistic strategy is to continue to deploy some level of mass market approach, like advertising, to create awareness of a brand/company/service and then use matchmaking social media strategies to weed out the good contacts from the true matches.

    Once you ID the matches, converse with them and let them introduce you to their friends who will most likely be a good match too.

    By combining the two approaches a company gets the best of both worlds – speed to market and successful long-term customer value.
    @TomMartin

  2. Liz S says:

    Steve – hmm. Not sure there’s much of anything new here. Even traditional marketing practices look closely at the audience and then target messages appropriately. Although SM might take it to the next level by emphasizing the value behind multidirectional conversations (or matchmaking for that matter), I believe that micro managing the relationship to the point where it doesn’t work at all.

  3. “How can we use networked communications to find the right people for whom we are the right fit (and vice-versa)?”

    It’s about relationships. With so many choices consumers have to have a trust in you and your business. This takes time. It’s why ROI is tough to measure with social media because it can be a very long-term process.

  4. Steve,

    I think what you are talking about here is something that I post about often. . . RELEVANCY.

    One of the greatest benefits of social media is the ability to interact at a conversational level and connect substantively with users to extract key information — likes, dislikes, interests, even communication preferences (which, believe it or not, is not always the web even though you are interacting online). And online behaviors are also very telling in mapping out customer profiles through which you can craft relevant messaging to an audience who is pre-disposed to the content, within the right context, and via the strongest delivery method for driving the desired behavior.

    A word of caution, however, that relevancy does not exist without trust and timeliness, meaning that there must first be an established relationship with the customer, and they must be in the mindset to receive the message. In other words, if I post on Facebook that I just had a baby and am immediately served ads for car seats, while the ads may be relevant to my situation, if I don’t have a relationship with the advertiser/brand trust, or am not seeking a retail buying experience at that moment, it will be meaningless.

    At the core, it’s about targeting effectively and building relationships. But relationships take time to develop, and special care must be taken to show customers that you have their best interests in mind, and are delivering value within a welcome experience. And what better way to facilitate that than through one-to-one media? Casting a wide net is an old school marketing tactic that is no longer viable in a space where you can drill down to pinpoint customers and opportunities that will produce results. And more often than not, it’s within a highly specialized niche market, which are typicallly the most fruitful, despite the fact that everyone’s always chasing the mainstream.

    When all is said and done, it’s not a numbers game. It’s a values game. Numbers are merely a by-product of creating relevant encounters one by one by one.

  5. Alan Wolk says:

    Without repeating what’s been said previously, I think too many people crave the pot-of-gold that trolling for new customers can allegedly bring.

    Who wouldn’t want to grab 500 new customers for far less effort than it takes to nurture 100 existing ones.

    The concept of organic growth is a tough one for the anxious businessperson to wrap their heads around. And it’s just as tough for a large corporation with shareholder pressure as it is for a small business owner who’s hoping to see an actual profit.

  6. Shannon Paul says:

    Steve,

    I actually think matchmaking is a good analogy, but some brands need to be bigger than others. When you’re talking about something that is a commodity, taking a one-to-many approach may still work, but using the one-to-many in combination with a one-on-one approach is probably still best. We can find out best matches but still reach out to the periphery with other communication methods.

    That said, brands like Tide (laundry detergent is definitely a commodity in the U.S.) seem to do a great job differentiating their brand from the rest by touting higher quality and claiming that “the results are worth it”. I think the important thing to remember is that the matchmaking approach should also apply to the assignment of strategy… in other words, yes, sometimes the matchmaking approach should be considered when thinking of social media strategy. Can we identify other approaches to strategy that can work in concert with the matchmaking approach?

    I really like where you’re going with all of this by the way — good stuff. :)

  7. @ShannonPaul Great thinking, as always, but I might add that “commodity” brands still need to forge relationships with their customers. And probably more so, to differentiate above just price point. Whether it be by sparking an emotional connection with users (a la the experiential approach that Coke has mastered), delivering value-added benefits or appealing to different segments of the population with varying messaging under one umbrella brand position, “matchmaking,” or relevancy, should still be central to the strategy. In a case like Tide, a particular message or value proposition may “match” several thousand at a time, but that doesn’t discount the fact that brands are built by loyal customers, and commodity or not, [positive] brand experience, affinity and other intangibles that connect consumer to brand almost always trump price alone.

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