The recently published study was a joint research by Vivaldi and Partners and Prof. Johann Füller who is affiliated with the University of Innsbruck and MIT Sloan. CEO and founder of Vivaldi and Partners Dr. Erich Joachimsthaler, co-author of well know literature on branding (e.g Brand Leadership), sees great potential in the new social media channels: “Today, one of the most important strengths of a brand is its social currency, the extent to which people share the brand or information about the brand with others as part of their everyday social lives.” Their main focus lies on the usage of social media channels.
The study investigated over 1’000 US respondents during Dec 09 and Jan 10.
What is Social Currency?
A brand represents a significant intangible asset of a company. There are several approaches on how to measure brand equity (Aaker and Keller 1990; Rangaswamy et al. 1993; Bottomley and Doyle 1996). The approach taken by this study is based on Pierre Bourdieus social capital theory and describes social currency as an asset of different dimensions, creating a unique brand identity. Social currency derives from networks of people in the online and offline world. Due to the increasing social nature of the Internet and mobile devices “consumers and customers adopt these technologies and platforms and integrate them into their daily life routines and contexts. This also changes how they interact in all parts of life with people,products, brands, and businesses.”
In short, social currency is more than just the relationship with a brand. It’s how customers talk about it and interact with other customers.
Since every sector has its own features and have to excel in special categories (For example categories like fast food or beer rely less on strong affiliation amongst their users), the study evaluates social currency of the 51 brands split into their special sectors.
You would think that the airline industry is a social category, bringing together thousands of people. On the other hand airlines nurture social communities, with frequent flyer miles and other loyalty programs. jetBLUE airways ranks top in this category, since the majority of customers can identify themselves with other jetBLUE customers. They feel like they are part of the community trough the brand.
The automotive industry is characterized by its high involvement of customers but is divided in premium make drivers and volume brand drivers. The first group has much higher social currency levels than the later, and volume drivers focus on learning form other drivers.
Beer is a very social product, but although beer brings people together they don’t feel inclined to discuss their brand of beer. Beer has the ability to form communities and bring people to identify themselves with the group. Big brand usually don’t utilize these strengths and focus more on developing their products and gadgets, such as packaging innovations.
The fast food category shows large polarization of customer support. Everyone has his favorite fast food chain and is patron of one or the other company. Even tough Burger King has created some buzz in social media during the past couple of months, it scores lowest on social currency in this study. Therefore the authors propose that online buzz does not equal conversational value to customers.
In skin care the companies have created “fun”-brands but no sense of community is measurable in this field. At least when it comes to men. Women on the other hand have developed a more communal understanding and can relate to other women. “Clinique” has been able to establish a micro-community around its brand, Dove hasn’t been able to do so yet.
Community and community spirit is one of the most important factors for sportswear brands. Soccer world championship, Olympia or the National Hockey League. Sportswear brand are able to capture a sense of community and rank high in social currency. Smaller, more fashion oriented brands take the lead in this study. Large brands such as Nike or Adidas fall surprisingly behind. Puma has managed to form the biggest bonds with its customers.
Being flooded with information, people tend to seek sites with relevant information. Specially sites with high customer feedback are high in social currency. Encouraging other users to post relevant information on the website, makes a site more valuable in terms of social currency. iTunes has changed listening habits of people and therefore ranks high in social currency (Although a certain Apple Halo effect can be expected).
With social media people are starting to trust anonymous peers more often than respected brands. Although Google is known for quality and trustworthiness, its not viewed as a social product. It doesn’t make people feel like a part of a community or engaging in a relationship. It’s a reliable helper but not a partner (Although they are starting to enter the field with services like Google Buzz). Apple on the other hand is one of the strongest brands in getting people to feel like a part of a community. It guarantees a fun experience and has built up a real “Apple-Community” fellowship.
B2B technologies have different rules than consumer driven brands. A brand is more a door-opener, than a crucial selling point. But B2B brands have realized that it’s also very important to build strong relationships. Oracle has created a very strong level of identity and affiliation.
“The successful brands in our study strive to be an integral part of people’s daily lives by enabling them to connect, interact and benefit from like-minded brand users”.
How to manage social currency?
- Understand the buyers’ ecosystem.
- Determine the levers of social currency that drive value in the industry or category.
- Define the social currency strategy.
- Develop and execute social currency programs that drives value.
For further information visit Vivaldi and Partners or download the full paper under www.context-digital.com
Additional information also under: fastcompany.com