We are in the middle of a social media bubble. Every company is wildly chasing after the promised rewards of social media with very few actually investing and scaling in a sustainable way. Most companies seem to be throwing a grenade of attention, time and money at social media instead of developing an objective, rational battle plan.
The early successes of first-movers in the social space has triggered a mass crusade of companies who have unreasonable targets and bloated expectations.The benefits of simply “doing” social media are showing quickly decreasing returns as the first-mover premium wears off. Innovation in social media marketing and presences is pacing well behind the rate of market saturation, which will lead to a social media space that is too crowded to provide the expected returns of these companies now making significant investments.
The social media bubble will burst when consumers get tired of companies’ inauthentic and unoriginal presences and promotions. Consumers don’t want to “like” 1000 brands on Facebook, and they don’t want read the blog of their local dry cleaners. The market will crash when consumers start ignoring bland, blatant attempts by late-comer companies who are now overloading our social networks and attention streams.
When (not if) the bubble does burst, the market will correct itself and refocus it’s potential on the companies that understand the fundamental systems and mechanisms of social media. The companies that were just attracted by the buzz of shiny success stories will bear the brunt of the crash, as they should. And those that spend the time and money in the short-term to invest in a stable, sustainable and value-adding social media presence will emerge to reap the long-term returns.
Ben said:
This is a powerful post. While we are in a social media bubble, the bust is going to come quick and will be drastic. I imagine that many companies will stop once they don't see a near immediate return on investment particularly in a soft economy.
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Fri, 2010-08-27 09:38 — BenMichael Cayley said:
I think the social media "bubble" will collapse into and across the entire enterprise.
I had a meeting with a new VP of Social Media at a major bank a few weeks ago. A senior executive and smart woman who has been with the bank for 15 years and expects to be there for another 15 years (and probably will be).
One of the first things that she acknowledged was that her job won't exist in 3 to 5 years. Not because social media will be history. In fact social media will be a much bigger phenomena commanding real money attention within this period rather than a fraction of the "new media" budget fraction of the overall marketing budget which is a fraction of the overall operating budget.
The VP of Social Media job will not exist for the same reasons there is no VP of Telephones or VP of EMail.
When investors and major corporations come to understand that social media is connected to stable future earnings, it will move into core business management away from the spotlight of early adoptor giddyness.
Read more here:
http://socialcapitalvalueadd.com/share-the-scva-ebook
Cheers,
Michael
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Thu, 2010-08-26 16:22 — Michael CayleyChristine Fife said:
The title of this post suggested it would discuss the bursting of the social media companies bubble, but I was pleasantly surprised to read your thoughts on how the bubble for how companies are using social media will burst. As a marketing professional who advises clients on how to use social media effectively to engage with their audiences--Listen, Speak, Care, Share and Build relationships--I sad to see so many companies failing at using social media to "talk at" people. So often I see companies who are looking to hire a "social media intern" because they're under the impression that "doing" social media is a free way of increasing their business.
As this post points out, social media fails when companies use it as another means to make more noise by using it as another advertising/talking "at" people location. Consumers actively work at avoiding spam and junk mail and now they actively look to avoid more advertising within their social communities.
As Forrester's Augie Ray pointed out the other day in his post Do you want to Succeed at Social Media or Social Media Marketing?, what's the point of being good at offering social media links and fan pages to your audience if you don't understand, as a business, how to be "social"--how to treat your customers and other audiences with respect, understanding and intelligence so they feel compelled to engage with your company's social media outlets, share positive experiences and recommend your products/services to other people.
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Thu, 2010-08-26 14:32 — Christine FifeTom Pick said:
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Thu, 2010-08-26 14:26 — Tom PickKevin Temple said:
It's already in progress. I used to be an avid Twitter user for my business, but realized I have a lot more followers (connections) on LinkedIn, and the Twitter base was largely competitors following my activities. Now that Linkedin has a "twitter" feature, I primarily use that tool to communicate with my base. So in effect, I have consolidated two of my social media tools into one. The winner was LinkedIn in my case.
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Thu, 2010-08-26 13:26 — Kevin TempleSBROWN said:
I am suprised at how many technology companies exist to support social media. They cannot all survive. When I first started blogging 3 or 4 years ago I signed up for a bunch of aggregate services to promote my blog. Many of them are no longer in service (BlogRush being one of them).
Only a few players will make enough money to stay relevant the others will fizzle away. Unfortunately those that fizzle will likely be the services that make our lives easier when it comes to updating multiple social media services. But if there are fewer left to update, it won't be that terrible.
SB
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Thu, 2010-08-26 12:22 — SBROWNKirsten Osolind said:
Social media flacks are fiercely defensive, with good reason; they need to justify their livelihood. The real world is outside the social media bubble. 46% of all U.S. small businesses don’t even have a website yet. (Source: eMarketer 2010). And when it comes to targeting consumers, social media is still largely a niche product, attuned to early adopters and tech/online-savvy folks.
Social media and apps will not save U.S. business, print media, or small shops. Social media isn’t a strategy; it’s just a tool. And plenty of tools prove more effective. U.S. businesses need to get back to basics: good old fashioned hard work, good products instead of worthless cr*p, value pricing, reverse logistics and smart supply chain management, integrity, ethics, localism, and in-person handshakes. Even coupons deliver greater sales results. In fact, a recent Razorfish report proved most consumers friend brands on Facebook and follow brands on Twitter mainly to gain access to deals and discounts.
Perhaps the new Jeep campaign expresses it best: “This used to be a country that made things. Beautiful things. The things we make, make us.”
Kindly,
Kirsten Osolind
RE:INVENTION, inc.
www.reinventioninc.com
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Mon, 2010-08-23 22:31 — Kirsten OsolindBriana said:
Great Post! And so true, daily companies are trying to make this work for them, without the proper planning, experience, time and money spent on investing in a real-time engagement strategy. It's as if they feel social media is here to save the day, when in reality it is only here to provide value to their clients and prospects. This "directly selling" on social media is already old! I'm tired of receiving daily messages from people who no more know me or care what I have to say then the man on the moon. It's time companies wake up, see the real power and stop abusing their social rights.
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Mon, 2010-08-23 13:09 — BrianaKirsten Osolind said:
Social media flacks are fiercely defensive, with good reason; they need to justify their livelihood. The real world is outside the social media bubble. 46% of all U.S. small businesses don’t even have a website yet. (Source: eMarketer 2010). And when it comes to targeting consumers, social media is still largely a niche product, attuned to early adopters and tech/online-savvy folks.
Social media and apps will not save U.S. business, print media, or small shops. Social media isn’t a strategy; it’s just a tool. And plenty of tools prove more effective. U.S. businesses need to get back to basics: good old fashioned hard work, good products instead of worthless cr*p, value pricing, reverse logistics and smart supply chain management, integrity, ethics, localism, and in-person handshakes. Even coupons deliver greater sales results. In fact, a recent Razorfish report proved most consumers friend brands on Facebook and follow brands on Twitter mainly to gain access to deals and discounts.
Perhaps the new Jeep campaign expresses it best: “This used to be a country that made things. Beautiful things. The things we make, make us.”
Kindly,
Kirsten Osolind
RE:INVENTION, inc.
www.reinventioninc.com
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Mon, 2010-08-23 09:02 — Kirsten OsolindEricFulwiler said:
Thanks to everyone who commented on this post. I love hearing people's thoughts, responses and (especially) differeing opinions. I truly apologize for now being able to respond to everyone, but I am always available if you want to reach out to me directly.
Thanks again!
Best,
Eric
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Mon, 2010-08-23 00:20 — Eric FulwilerDan Greenfield said:
I think social media will just become media in time. I prefer to use the word engagement these days which incorporates new and traditional media. They hype (or rather the novelty) will go away once it is integrated across the enterprise and becomes just something we do.
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Sun, 2010-08-22 14:49 — Dan GreenfieldEricFulwiler said:
Dan, I totally agree. (I hate the term social media. It's so redundant. Media is by definition social.) I actually like the term "micro media". Compared to traditional marketing/advertising/PR, which was "macro" in scope and delivery, what we call social media is just media focused through micro channels.
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Tue, 2010-08-24 12:20 — Eric FulwilerCoach Chic said:
I'm wondering if this struck anyone else the way it did me. I mean, the first thing that came to mind -- especially as it pertains to Twitter -- is "hashtag". (I think some keywords over on Facebook have at least a slightly similar effect.)
What I'm getting at is that a lot of the spammers on a site like Twitter have no real keyword or hashtag to attact like minded people. Nor do a lot of the very large companies, except when a consumer suddenly needs a given product.
On the other hand, even though my niche is rather small, there are an awful lot of "hockey" enthusiasts who want updates, announcements and the chance to just interact with like minded people.
Again, I'd really like to know if anyone else feels the same.
Dennis Chighisola/Coach Chic
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Sat, 2010-08-21 19:48 — Coach ChicPatricia Millman said:
Oh no and as a newbie to blogging I am just getting the hang of social media. Here's hoping it stays around for awhile. Although that said; I am meeting more people and building more relationships in the blogging community than I probably am on Twitter.
This post is thought provoking and I'm sure there will be lots of different views expressed by people who know a lot more than me about it!
Patricia Perth Australia
http://www.lavenderuses.com
all things lavender
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Sat, 2010-08-21 03:14 — Patricia MillmanSandy Ketcham said:
Thank you for saying what I have been thinking for a while now.
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Fri, 2010-08-20 18:27 — Sandy KetchamMikeFeravolo said:
The only way to create an Internet Community for your business is to provide something that has real value and that is what most businesses fail to do. For example, they wonder way people are not beating the door down for that "free coffee" with a purchase of a fifty dollar meal that they spam out 10 times a day from their facebook page.
The only way that social media is going to be effective for you, is to offer something of real value. Maybe that is as simple as answering people's questions in a timly manner and providing a level of customer service that's better then your competitors.
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Fri, 2010-08-20 15:59 — Michael FeravoloNeicoleCrepeau said:
I'm not sure that "burst" is quite correct. I think social media is here to stay. It is useful and can be beneficial to companies and I think that will continue. I would agree that there will be a shakeout. If you compare it to the housing bubbles in the past, right now there are a lot of speculators in the market. Lots of people doing social media in a bad way, just as lots of people came in the market to flip houses and didn't know how to do that properly. There's also a lot of exploration and trying different things. Social media is still so new, it's not clear what works best, yet.
I think there will be a shakeup and eventually, the people and companies that are doing it badly will disappear. Best practices and "correct" ways of doing social media effectively will emerge. The area will settle down as just another marketing/business tool that needs to be used strategically. Just as the housing market's bursting shook out all the nutty speculators. There are still plenty of people flipping homes, though. They are just the ones who know how to do it right and make a reasonable (though not excessive) profit.
The greater fear is that there will be a backlash because of all the unrealistic promises and expectations, and the hype around social media.
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Fri, 2010-08-20 14:08 — Neicole CrepeauEricFulwiler said:
Hi Neicole,
I definitely believe social media is "here to stay", but I think the business landscape of it will change via a correction in the market. It seems you kind of proved that point with your explanataion in the second paragraph of your comment...Or maybe I am not understanding something? But yes, i agree with everything you said. Maybe "burst" wasn't quite the right word, but 'correction' or 'shake-down' work as well.
Thanks for your comment!
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Mon, 2010-08-23 00:06 — Eric FulwilerRob Wilmot said:
Social media is not about implicit marketing, it's about building up trust based relationships with your audience by engaging with them beyond your brand. It's like when BT mention me on Twitter for talking about their broadband service, when I 'Liked' South Yorkshire Police via their Facebook social plugin on their website because they were great when someone nicked the copper piping of the side of my house, and when Business Week featured me on their homepage for a comment I made on one of their blog posts. I hate to use the cliché but it really is about creating social capital, investing time and energy over a sustained period of time and cashing in only when the opportunity presents itself at the buyers discretion.
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Fri, 2010-08-20 13:34 — Rob WilmotDennis McDonald said:
Social media, the web, email, web 2.0, open government, egovernment, enterprise 2.0, wristwatches, voicemail -- all dead.
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Fri, 2010-08-20 13:31 — Dennis McDonaldChris S. Cornell said:
Your article and its title were well-designed to attract attention -- and will hopefully generate a lively dialogue. I think the premise that the "social media bubble will burst" in part because of the fast-growing number of participants is about as amusing as Yogi Berra's famous comment "No one goes there anymore. It's too crowded."
There's no question that there are many businesses, organizations and individuals with unrealistic expectations about social media -- but to suggest that this will cause a "bubble" to "burst" seems far-fetched.
Can we agree that social media (as you are using it) is scalable web-based technologies that allow users to engage in a dialogues -- as opposed to the more traditional methods which allowed only a unidirectional flow of information? Social media is a tool (or more accurately, a vast collection of tools) that allows users to engage in conversations with other users. To say that these tools will cease to function because -- A) there are too many users or B) some of the users have unrealistic expectations -- is unreasonable.
I agree that most people will not want to read the blog of their dry-cleaner. Fortunately, I can assure you that most dry-cleaners have no intention of ever writing a blog (I've asked several).
For those that can create valuable, desired content, however, social media provides a new way of communicating
Social media is not going away. For those who use it properly, it's not a bubble and it's not going to pop. You can take that to the bank.
I'd love to continue this dialogue.
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Fri, 2010-08-20 13:13 — Chris S. CornellEricFulwiler said:
Hey Chris,
Awesome thoughts here. Thanks so much for taking the time to continue this discussion.
I don't think social media is going away at all. I think the, fundamental tools, incentives and interactions that drive social media today (no pun intended ;) ), will continue to work in the future because they are the foundation of the social media system. However, i think there are also some 'improper' tools, incentives,etc that work now that WONT work in the future because they are NOT the foundation of the social media systems. Companies that are now able to get great press and tons of attention from the wrong tools or campaigns, won't be able to realize that same return when people decide that just taking a step into the social media world isn't enough. The correction will be when people reward ONLY the "right" steps, and not just any step.
Does that make more sense? I feel like my response doesn't nearly do yours justice. ;)
I would also love to continue this dialougue. Let's connect for sure, or keep going in this comment chain.
Best,
Eric
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Mon, 2010-08-23 00:12 — Eric FulwilerEric Westerman said:
Couldn't disagree more. Social media bubble won't burst unless people stop using social media. Companies will always have to flock to where the customers are - and they are flocking to social media.
It will be increasingly difficult for individual companies to develop and maintain a presence in social media. But on the macro level, social media involvement and advertising is going to continue to expand indefinitely.
Your post towards social media in 2010 is the equivalent of somebody saying that this whole web bubble is going to burst in 1996. Despite the dot-com market crash, internet marketing has done nothing but increase since that time.
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Fri, 2010-08-20 12:16 — Eric WestermanEricFulwiler said:
Hi Eric,
By a bursting bubble I was referring to companies only being rewarded for using social media the right way. I think that currently, in the inflated market bubble, companies are being rewarded just for using social media at all. THe correction will be when consumers (aka people) decide that just doing social media isn't enough, it has to be done right.
With regards to your last paragraph, I think you kind of prove my point, dont you? I am theorizing a very similar crash/reorientation/rebuilding of social media...It won't have anywhere near the same economic effect as the web bubble, but in terms of the cycle, i think it will be similar. (Also, this ties into all these "social start-ups" having millions thrown at them just because they are in the "right space". Economically, when too many people are in the right space it becomes the wrong space.)
Thanks for your comment!
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Mon, 2010-08-23 00:19 — Eric FulwilerEric Westerman said:
Not at all.
There was never a "web bubble" that crashed. We have far more web sites and web marketing now than we did then. The dot-com crash was a single sector of the STOCK MARKET that burst because investors overbid on IPOs that offered no real product or service of note.
Actual WEB MARKETING barely hiccupped and has done nothing but expand exponentially through that point.
If you're arguing that pure social media companies will see a similar affect - that I can agree with. But in terms of legitimate companies continuing to build their social media presence and overall growth in social media marketing, I see no end or burst in site.
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Mon, 2010-08-23 11:49 — Eric WestermanKrista Madde said:
I totally agree, jumping in with no real plan and over inflated expectations will do nothing for ensuring a worthwhile way of communicating remains part of your media strategy. We are working to select quality blogs to work with that genuinely add value to your brand.
That 'Like' button really does nothing for me - am so bored of hearing "we are setting up a Facebook group first, then thinking about how we next work in Social Media...." just do it - don't keep thinking about it, but get good advice first!
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Fri, 2010-08-20 12:10 — Krista MaddeRobertBacal said:
I'm really glad to see others taking up the megaphone to start warning people about the coming social media contraction. There's actually a lot more evidence that this will happen, and probably by sometime in 2012 that is going to "take out" a lot of smaller companies, and devastate the employees (former) of those companies.
We are repeating the boom bust cycle of the late 90s's and 2000.
We have a bunch of articles on the future of social media, and a three part (so far) series as to why and how the crash will come, at http://socialmediabust.com/social-media-topics/25-future-of-social-media.html
I'd LOVE to see more people commenting and helping people prepare for what is almost inevitable at this time.
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Fri, 2010-08-20 11:55 — Robert BacalPost new comment