An Overview of Social Currency
This past September, Kellogg’s opened the world’s first Tweet Shop. Customers could pay for Kellogg’s products by tweeting rather than using cash or credit. Pretty neat, right? But what exactly does the concept of a ‘Tweet Shop’ imply about social media and marketing? Is Kellogg’s Tweet Shop signalling a new direction of ecommerce and content marketing?
When Currency Goes Social
Vivaldi Partners, a strategy consulting firm, defines social currency as “the degree to which customers share a brand or information about a brand with others.” Consider Ryan, an individual who has over 2000 Twitter followers, a LinkedIn Network with over 500 connections, and is highly active in the online realm. The positive endorsement that Ryan makes about a brand can create a trickle effect where his followers and friends buy-in to the brand as well. This sounds pretty basic but the implications are impactful. Encouraging your influential ‘Ryans’ to endorse your brand can create value through his word-of-mouth referral. While social currency can explicitly be substituted for money (as illustrated by Kellogg’s The Tweet Shop), general brand engagement is a broader aspect of social currency. According to the Vivaldi Partner’s global study on over 5000 customers, there are 6 behaviours that drive social currency:
1. Utility: derive value from engaging with brands and other people
2. Information: receive from, and share with other people valuable information about brands
3. Conversation: talk about a brand or business to others
4. Advocacy: promote or defend a brand or business
5. Affiliation: connect and become a member or community of people that is linked to a brand or business
6. Identity: express myself, the brand, and my relationship with others to others
Social Currency Examples
Dropbox: users can increase their storage space in exchange for Tweets or referrals. Social currency occurs when Dropbox exchanges their product or features for social media shares and mentions. This is an easy way for Dropbox to get positive endorsement about their brand…and the cost of the “free” storage space is subsidized by the incremental users that signup as a result of social media mentions.
Groupon: users can earn id="mce_marker"0 in Groupon Bucks for referring a friend who subscribes to Groupon within 72 hours. According to Groupon, this is their “way of saying thanks for spreading the good word and increasing collective buying power.”
Influitive: based off the concept that enthusiastic and engaged customers are the best brand advocates, Influitive is a portal that enables companies to create engaging social experiences, such as “challenges”, surveys, referral campaigns, and more. Influitive rewards influencers so they become natural brand advocates.
Pay With a Tweet: a social payment system where people pay for products or services with the value of their social network. Company X can create a Pay With a Tweet widget and Ryan can simply download Company X’s white paper or product by tweeting about it.
Pay 4 Tweet: allows you to buy tweets based on an individual’s following and that individual will tweet in exchange for money. For example, you can buy a tweet from OMGFacts, who has over 5 million followers. For the price of $5000 per tweet, OMGFacts will share your tweet with their followers. This is an example of social currency where the value of a particular individual’s network is capitalized (the social currency part), in exchange for monetary currency.
Social Currency Cautions
One issue with social currency pertains to the concept of ‘influencer’. There’s a big difference between being an influencer and driving engagement – and the two don’t go hand in hand. While someone can have a large following on Twitter, their brand endorsements lack value if their audience isn’t engaged. On the other hand, an individual with fewer followers would create more value for a brand if their smaller audience was more engaged. While tracking engagement is a struggle that marketers still haven’t fully resolved, social currency is more powerful when it’s focused on people who can successfully engage others.