Social Influence Marketing: Understanding those Peer Influences

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Here's my latest article on Social Influence Marketing where I delve into how those peer influences actually. Let me know what you think of this one.

At the root of Social Influence Marketing™ is how peer influences work. With the digital world going social, we recognize that peer influence is having a greater affect on brand affinity and purchasing decisions than any traditional form of marketing. Customers are excited about doing the marketing themselves if the product is strong. We also know that with the proliferation of social technologies from mainstream social networks like MySpace and Facebook to niche social tools like del.icio.us (bookmarking) and FriendFeed (personal content aggregation), the peer influence may take many different forms.
But how exactly do these peer influences work? What motivates a person to share a piece of media with a group of friends or participate in an online community? How does one person’s purchasing behavior affect another’s?  Who are the consumers doing the influencing? And how can you design for influence? In this article, I discuss the motivations to share, how the location of a person in a network plays a role, and whether you can market to those influencers. I then provide tactics specific to the retail sector to take advantage of peer influence.

Motivations to Share

Abraham Maslow emphasized that personal value precedes network and social value in his hierarchy of needs theory. He argued that most people are not selfish but self interested  – they are always searching for an answer to the question – what’s in it for me?  This applies to the web domain where people don’t share and allow peer influences to take place just for the sake of it. People share online when they are incented to and when there’s potential for personal value to be realized.

Clay Shirky and Peter Kollock also point out that once a person has been able to derive strong individual benefit from a particular experience, the motivation to share increases significantly. This happens as the user realizes that through the collective action (or experience) there’s opportunity to derive even more personal value from it.

What are the implications of this? When you design a website or online marketing campaigns, remember that if the experience isn’t valuable to one person, it won’t be to a hundred, a thousand, or a million people. Tied to that, consumers must be able to derive greater value through the act of sharing for them to make that effort. For example, a person would be more likely to share a piece of media to influence a peer if the act of sharing enhances his reputation among those peers or if it encourages the peers to participate in the social activity too.

Location in the Network

Not everybody is inclined to play a role in influence either. People use the Internet in different ways, and their usage patterns dictate how likely they are to share information and influence each other. But more than that, their location in an online community or social network heavily influences their likelihood of playing a role in influencing others.

The closer a person is to the center of the conversations, and the more people he is connected to, the more likely he is to influence his peers. Because he is directly involved in many different conversations, his peers typically treat him as a credible or appealing information source. They get used to getting information from him and get used to sharing information with him, providing him with something to respond to in turn.

As a result, this person is in a much stronger position to influence a peer than someone who only occasionally participates in the conversation or is just loosely connected to the group. In fact, this is how the influential bloggers work too – because they are at the center of conversations sharing a lot of information themselves, they have lots of influence.

The same philosophy applies to networks of friends and how they share information online. Why does this matter? It is important to recognize that not every Web user is a candidate for peer influence. Only those that are at the center of their networks communicate actively and regularly with their peers and can play this role. Look for those people, and meet their needs as you design for influence.

Influencers are not Brand Advocates

A report from JupiterResearch highlights that nearly 25% of all online adults are brand advocates. They are more likely to research and purchase products online too. But as the reported pointed out, these brand advocates focus on gathering product information and purchasing them, rather than spreading the word through social media sites. They are not the most important influencers.

Rather, the most important influencers are the people who play a role further down the purchasing funnel. They are the people who are solicited for advice while a consumer is in the consideration phase of a purchasing decision. These people are in the consumer’s network – online and offline. They serve as validation points sharing their own experiences of a product with the consumer, pointing the consumer to resources that can affect the purchasing decision, and weigh in with their own opinions. How do you reach them?

Contrary to traditional word-of-mouth marketing strategies or even viral marketing, you don’t. You let your potential customers, who are in the consideration phase of a purchasing decision, reach out to them. Why? Because these influencers don’t vary by product, rather they vary by consumers. And it is difficult for you as a marketer to know who the core influencers for a brand consideration or particular purchasing decision are. In some cases, it may be the consumer’s parents or it may be the friends, or peers at work or relatively anonymous peers in a discussion forum, or maybe a combination of all these.

Tactics for Success

So if you cannot reach these important influencers that are having a far greater influence on purchasing decisions than any other form of marketing, what can you do? You can formulate your web strategies to allow for those peer influences to take place. I introduced some tactics in my previous article, here are some more but specific to online retail experiences –

1. Integrate more deeply with the social networks. Yes, your consumers are spending a lot of time on these social networks, and that won’t change anytime soon. Office Depot allows consumers to post messages directly to their Facebook profiles, or into their newsfeeds, about products they are interested in. It does this from the product page on its site. It makes it easier for a consumer to solicit feedback from his peers.

Other e-retailers should follow by integrating directly with the social networks allowing consumers to get feedback more directly during their purchasing process. For example, a consumer should be able to take a product from a retailer Web site, post information about it in his social network, and solicit feedback via a poll from his network seamlessly. No one does this today.

2. Point customers to third-party review sites. Consumers are going to go to third-party review sites regardless of what you tell them on yours. So rather than trying to stop them, point your consumers to the most authorative and credible ones out there. They will appreciate this and return to your site once they are ready to make a purchase. Most sites point to favorable product reviews in the mainstream media, but that’s not enough.

By pointing to the blogs and review sites themselves, consumers will know where to look for more information, and they’ll find communities of peers looking to make similar purchases. These are peers that can positively influence them.

3.Tie more directly with the offline shopping experience. Consumers move between the online and the offline space as they make product purchasing decisions. The iPhone and other mobile devices that simplify web surfing are making this happen more. In fact, Google has seen a 20% increase in searches from mobile phones in the last few months.

Therefore, as you think about an online shopping experience, keep in mind those offline scenarios and how social influence can support them. A consumer might be surfing to your web site or broadcasting to his Facebook network asking for advice while standing in a retail outlet looking directly at your product. So for example, consider publishing the customer reviews for a particular product that were originally published online in the retail store itself. Staples is already doing this successfully.

4. Make the product a strong discussion point.
We’re used to thinking of products in terms of features and specifications in relation to other products on retail Web sites. Separately, we think of online communities and social networks as places where people talk to each other. Those two worlds can blur if you allow for more conversations around the product. It’ll lead to more peer influences.

Amazon has started doing this with their Customer Discussions. These aren’t customer reviews, rather, they are forums to discuss the products and everything about them. They are designed to enable conversations about a product that people are interested in.

5. Leverage your employees to build online communities.
Both Best Buy and Circuit City in different, but exciting ways, encourage their employees to participate in their online communities on their retail Web sites. These employees answer customer queries about specific products, advise each other on technical issues and demonstrate that there are real, authentic people who care behind the brand.

Why does this matter? Because when these employees play authentic and personal roles in online communities where consumers are making purchasing decisions, they blur the lines between sales representative and peer influencer. That’s not a bad thing, necessarily which is why these retailers, and others, should encourage their employees to participate in third-party online communities too – as long as they do so honestly, authentically, and appropriately.

Social Influence Marketing™ takes many different forms. As we’ve seen, at the root of Social Influence Marketing™ are the peer influences that can positively affect brand affinity and purchasing decisions. Taking advantage of social media, by tapping into the Social Influence Marketing™ concepts, requires a more rigorous understanding of those peer influencers. Only through a focused understanding and appropriate design tactics can you take advantage of one of the most important dimensions to marketing today.

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