Social media is growing in popularity, and it is making its way into the channel.
Vendors Dell Inc. and IBM Corp. are moving quickly to incorporate social media strategies into the way they engage with both solution providers and customers. Solution providers that don't start paying attention to the new ways to engage and interact with customers may get left behind.
Twitter and Facebook are two of the fastest-growing social networks on the Web, according to a February report from The Nielsen Company. Facebook ballooned from just more than 20 million U.S. members in February 2008 to more than 65.7 million U.S. users just one year later, according to Nielsen. On July 16, Facebook revealed it had reached the milestone of 250 million users worldwide.
Equally impressive in the social networking front was the growth that Twitter saw from 2008 to 2009. Last year the microblogging service had 475,000 members; by February of this year Twitter had grown 1,382 percent, to more than 7 million members, Nielsen reported.
While some solution providers might think that social media is for young people, Nielsen's numbers contradict that notion. The company found that nearly 42 percent of Twitter's audience is comprised of the 35- to 49-year-old demographic.
That means, in many cases, your customers are using social media. Solution providers that are quick to adopt a social networking strategy are likely to find a receptive and large audience just waiting to be explored.
Dell Taps Into Twitter
While social media is still something of a mystery to solution providers and vendors alike, Dell is proving that persistence can eventually pay off. Recently the Round Rock, Texas-based computer manufacturer said that it has made $3 million off one of its Twitter accounts since starting it in 2007.
Dell uses the Twitter handle DellOutlet to Tweet out special deals, coupons and discounts on hardware, gaining more than more than 700,000 followers. It has become one of the service's top 75 most-trafficked accounts, according to TwitterCounter.com.
The result of all that traffic is that the DellOutlet Twitter feed was directly responsible for $2 million in sales, according to the company.
In addition, Dell believes that its DellOutlet Twitter handle has led to an additional $1 million in hardware sales because it has acted as an entry point to other parts of its Web site for potential customers.
Part of the appeal of Twitter is that Dell uses it to provide realtime updates of the hardware deals the company is offering, said Tyler Dikman, CEO of CoolTronics, a Tampa Bay, Fla.-based solution provider.
"I'm not surprised that Dell has done $3 million in sales [through Twitter]. It seems that they are like many other businesses, including airlines, that have been posting super-fast specials on Twitter," Dikman said. "In the grand scheme of things, $3 million of Dell's overall business isn't much, but it goes to show that Dell is trying to reach out to all venues in which to push product," he said.
The computer manufacturer may be providing a road map that solution providers can use to put social networking to work on the bottom line.
The fact that Dell is using social networking to engage in a conversation with customers -- even if, in the case of the Dell Outlet it is just about hardware specials -- is exciting to Sandy Flynn, vice president of marketing at BMC Solutions Inc., a Kennesaw, Ga.-based solution provider.
"[BMC] sells solutions, so we are really excited about Dell selling through a venue like Twitter. It gives us a chance to have a dialogue with customers about solutions, and the conversation can work in accordance with Dell's hardware sales," said Flynn. "To date, we have seen little change yet on the impact to our solution sales, but we anticipate seeing more."
While Twitter may be making money for Dell, solution providers like CoolTronics and BMC Solutions aren't seeing the pecuniary benefits of the microblogging service. But that doesn't mean that solution providers can't find other value in the service.
Kevin Carpenter, district manager for Netarx Inc., a Farmington Hills, Mich.- based solution provider, has been using the Twitter microblogging service as a form of marketing outreach, admittedly a slight deviation from his original strategy.
"The initial goal was to get on Twitter to get leads off of Twitter. No sales came," said Carpenter. "But the more I use [Twitter], the more value I begin to see." Carpenter decided to develop a specific voice for Netarx's Twitter feed and to focus on the specific service and technology areas in which the company is working.
"My Tweets take on the flavor of the people I want to find me," he said. That means that if Netarx is hosting a sustainability summit, the Tweets from the feed focus on sustainability for a couple of weeks. If the company is working on a virtualization project or wants to push virtualization, that's what Carpenter Tweets about.
"Depending what I want people to find me for, I'll start blasting out Tweets or re-Tweets around what potential customers are talking about," he said. "Lo and behold, two or three people have found me and started conversations around the topics I've been Tweeting. There's no business to show for it yet, no P.O., but I am finding that the dialogue is starting."
And while those conversations are still in their infancy, Carpenter has hit upon one of the critical benefits of the microblogging service: the ability to listen to the conversation as it happens in realtime.
"I Tweet because there is a conversation going on out there," he said. "And if we're not in the conversation, then we can't be a part of it. Ultimately, customers need me to focus on how to impact their business today. Twitter allows me to have a voice in that space."
Solution providers say being active with social networking tools also helps them cultivate stronger relationships with vendors.
"I'm always looking at corporate blogs, Cisco, Sun Microsystems, trying to stay abreast of what's important to them," said Bob Olwig, vice president of corporate development for World Wide Technology Inc., a St. Louis-based solution provider. "Twitter gives me the feeling that the information I'm getting is coming straight from the horse's mouth."
Keith Goodwin, Cisco's senior vice president of worldwide channels, uses the microblogging network. For Olwig, having the opportunity to follow Goodwin and see what is important to him can help set Olwig's business apart.
"Cisco has thousands of partners. We're trying to differentiate ourselves and get our message to Cisco about our capabilities," said Olwig. "The more I understand what Keith Goodwin is thinking about, what's on his agenda, when I meet him at a Partner Summit I feel that I understand him better and the things that are more important to him."
IBM Co-Markets With Social Networking
IBM is using social media in a variety of different ways to engage and attract partners. Sandy Carter, vice president of SOA and WebSphere marketing, strategy and channels for IBM, is tasked with enhancing Big Blue's social media presence. Rather than focusing on a single point of entry, Carter and her team use as many social media tools as possible to engage with partners.
"Our social media effort started with a blog designed to share information, listen to partners and engage in discussion through comments," said Carter. "From there we began using gaming initiatives to educate solution providers."
That training initiative involves what Carter calls a "heroes and villains" game to train partners on how to use technology to drive smarter supply chains and customer service. As solution providers advance through the game, results and high scores are posted to other networks, such as Twitter and LinkedIn.
For Carter, social media acts as a way to get people involved in her programs. Solution providers looking to connect and engage with customers can learn a lesson from the strategy Carter and IBM have begun using at events.
"We use social media to cut back expenses," said Carter. "We set up a Flickr page at an event and enabled solution providers to take and post photos to it. We had 750 within the first day and set up a YouTube channel to let attendees post video."
Those videos weren't produced by IBM and, for Carter, it provides a valuable conduit for solution providers to tell IBM why they came to the event and why they work with IBM. Once partners were comfortable with the idea of social media, Carter and IBM began to offer solution providers co-marketing dollars that could be spent to co-sponsor events or be used in a virtual trade show setting.
"We set [solution providers] up on networks like Facebook and LinkedIn," said Carter. "We help them do consulting on social media plans for marketing outreaches that they can use when they go home."
Solution Providers Putting Social Networks To Use
With vendors using social media to engage partners, it's only natural that solution providers are also beginning to chart their own course with it. For the most part, solution providers seem to be sticking with tried-and-true networks like Facebook and LinkedIn. As Twitter has gained popularity, solution providers have begun to adopt it as well.
But for the most part, using the networks for business is a process that takes a little bit of time and some forethought.
"We're in the middle of investigating social networking," said Jeremy Nelson, CEO of Friendly Computer Services, a Tampa, Fla.-based mobile solution provider. "I started on Facebook [a few months ago] and I already have friends who are customers. It's easy to network with them." Nelson says he finds Facebook appealing because it tends to group users by interest. Solution providers who partner with Microsoft are likely to join a Microsoft group on Facebook, putting colleagues in touch with each other along with potential customers, Nelson said.
An enterprising VAR can use that group as a forum to mine for ideas, customers and even friends who work in the same field.
The continuous knock on Facebook, however, is that it is too informal for business use. Rather than having conversations about potential deals, Facebook is still a place where personal information is easy to access. That ease of access is enough to make some partners shy away from it.
"With Facebook there are blurred lines between personal information and pictures and the business use of it," said Olwig. "I know personally, I'm not ready for blurring those lines."
LinkedIn, on the other hand, has provided some real business opportunities. Olwig said he has been approached by potential customers and vendors on LinkedIn who have used the social networking site to make first contact.
"Manufacturers have come to us and tried to get us to resell their products, even though I haven't used the social network to promote my company that much," said Olwig. "They are using LinkedIn to have those conversations with us." In addition, LinkedIn can be used for the purpose it was likely created for: human resources and head-hunting.
"We're using social networking to hire resources through LinkedIn," said Bali Singh, vice president of business development at Zillion Technologies, a Falls Church, Va.-based solution provider. "We're using it to find the right people for the right job."
Nelson characterizes the differences between Facebook and LinkedIn succinctly: "LinkedIn is a professional site. No one wants to say anything because everyone knows that everyone else is watching," said Nelson. "On Facebook, people forget other people are watching and say things anyway."