Generating Lasting Loyalty And Strong Relationships
Aha! I finally realized why measuring relationships is the best way to measure social media results! Two words: Opportunity Cost.
The opportunity cost answer doesn’t come from sales, nor from marketing! It’s those sneaky HR people who had the answer up their sleeve all along.Them, and Dan Ariely, in his book, Predictably Irrational.
Ariely’s book highlights that behaviour is often motivated by one of two contexts – the social context or the market context.
The social context is where people do each other favours because they like one another and want/have/are building a relationship. It’s your mother in law’s Thanksgiving meal, for which she obviously doesn’t expect compensation and would be insulted if it were offered.
The market context is where people pay each other for products or services. The behaviour is motivated by this exchange of value, not some warm feelings towards the other party.
Ariely goes on to point out that companies have a difficult time trying to get into the social context, yet that the loyalty and latitude afforded such companies can be very valuable. Think of the employee who does unpaid overtime because his boss gave him 2 months paid vacation, without a second thought, when the employee’s wife was sick after giving birth.
(That’s actually a true story I read in a book called Sales Superstars, about someone in the courier industry.)
Well, generating that kind of loyalty and strong relationships exist between an employer and its employees is exactly what human resources is devoted to. Consider Sodexo’s excellent, succinct summary as to why companies offer benefits.
The aim of every successful company is to attract the best employees and to maintain their loyalty, satisfaction and motivation at and outside work.
A good chosen system of remuneration added by a good working system of benefits will increase your competitiveness by recruiting employees, will balance the steadily growing price of manpower in a flexible way and will help to motivate and stabilize the key company workers.
Similarly, my friend Tony Adam writes of the relationships he has built,
The people that I have established relationships with have led to great career opportunities, partnerships, knowledge, and most importantly, long lasting friendships.
The vast majority of US executives say that employee benefits help their companies attract and retain talent and that benefits are important to competitiveness, a new Quarterly survey finds.
This is as valuable as knowing your competitors’ keywords! Heck, it’s even more valuable because the best people will find you the best keywords and other seo strategies before the competition figures them out! Let them play catch-up!
Ironically, I should have known this myself, since I’ve been an advocate of building relationships for the longest time, as a direct driver of SEO success. But what I think is novel about this post and the reason I wrote what might otherwise be dismissed as another “benefits of building relationships” piece, is the human resources angle.
This isn’t something companies aren’t familiar with. As the McKinsey survey respondents said – this attracts talent and keeps top companies competitive. If you’re not necessarily taking that talent inhouse, you’re still getting valuable business opportunities from those relationships.
Dan Soha, of Five Mill PPC, told me about a moderately successful affiliate campaign he created, which made him $400/month. Through a better relationship with the affiliate network, he got double the payout, which allowed him to scale. The campaign now does $10,000+ a month! How’s that for relationship ROI? You can read any affiliate marketing blog, and they’ll all tell you that relationships are what takes you from little league to pro sports.
Tony highlighted the same thing – opportunities have come his way via relationships. Not developing these relationships – literally, social networking – carries with it a heavy cost in lost opportunities.
Not an opportunity cost in the traditional sense of options that were on the table but neglected in favour of alternatives, but rather opportunities that never made it to the table. Because there wasn’t that connection there. There was no social context. And short of running an ad campaign saying, “We are looking for partners and new business opportunities, so come pitch us,” you won’t have friendly contacts approaching you. Because you won’t have those contacts. (Also, as Ariely notes, money is typically the most expensive way of paying for things (e.g. those that might otherwise be had free in a social context.)
Here are some of the lost opportunities if you aren’t engaging in social networking, and measuring the relationship strength to ensure you’re doing a good job.
- At the enterprise level, this means partnerships that can add millions to the bottom line.
- This creates the (i) motivation and (ii) stability necessary for others to help you. To repeatedly top social broadcast media (e.g. Digg), you need the relationships to keep up.
- For businesses of every size, this means getting fed crucial information. For example, I got a tip at an SMX Advanced party from these CMS guys about some reputation management a client needed, which we then acted on.