Analyst Angle: Wireless shoppers and social networking

Editor’s Note: Welcome to our weekly feature, Analyst Angle. We’ve collected a group of the industry’s leading analysts to give their outlook on the hot topics in the wireless industry.
Those of us that spend hours a day, minutes a day, or even seconds a day online are almost certainly familiar with at least one social networking site and the volume of word-of-mouth marketing that occurs on them. Social networking sites are bucking the label of “just a fad” by continuing to grow at high rates. According to Compete.com (powered by TNS Compete’s clickstream panel – a behavioral panel which tracks the online behavior of millions of consumers across the U.S), Facebook is the No. 3 site on the Web (behind Google.com and Yahoo.com), with 202% growth year-over-year and Twitter is the No. 39 site on the Web, with 660% growth y-o-y.
Clearly, online users are visiting these social networking sites, so it should come as no surprise that online wireless consumers (online users visiting wireless carrier sites) are no exception. Using TNS Compete’s clickstream data, we have seen that wireless consumers are visiting social networking sites in increasing numbers.
Clearly, there is an opportunity for carriers to find their shoppers and customers on these social networking sites, but what can the carriers do to capitalize on this opportunity? In October, TNS Compete surveyed over 3,600 wireless customers about what they’d like to see from their carrier on social networking sites.
–22% of wireless customers with a social networking account are interested in participating in a sweepstakes or contest in which they can be entered to win a free smartphone;
–20% of wireless customers with a social networking account are interested in seeing special bundle deals offered only through the social networking platform;
–19% of wireless customers with a social networking account are interested in a chance to win or sign up for a special promotions from their wireless carrier (like tickets or special events) through a social networking site.
It appears that there is, in fact, plenty of opportunity to reach these social networking wireless consumers. With the average Facebook user having 130 friends and the average Twitter user having 126 followers, carriers would not just be reaching the social networking wireless customers but reaching their entire network. If the carriers can engage their customers on the social networking sites, the awareness of the brand could potentially spread exponentially.
The success of using word-of-mouth marketing on the social networking sites has been demonstrated. In July 2009, Twitter was overwhelmed by a Moonfruit (a U.K.-based company that offers free Web site building tools) marketing campaign. Moonfruit asked Twitterers to tweet a message with #moonfruit in it and when they did they were entered to win an Apple Macbook Pro computer. Moonfruit took it a step further by offering to give away one Macbook Pro per day for 10 days. The promotion worked. #Moonfruit was the top trending term on Twitter for several days (until Twitter manually removed it), and at one point, #Moonfruit was in more than 250 tweets/minute. By being the top trending term, #Moonfruit was in front of every user on Twitter.com, and anyone using their mobile device or other Twitter tools to check the top trending terms. To give you an idea of what that exposure truly adds up to, I used Compete.com to see that Twitter.com saw 23 million visitors in July and Daily Reach (the % of the U.S. Internet population using Twitter.com) peaked during the campaign at over 2%.
Moonfruit’s campaign only failed in that it did little to encourage true engagement with Moonfruit, and as a result, it likely failed at building sustained interest in the brand. A company that already has brand recognition will likely be more successful at building sustained interest. We’ve seen that since June, when Pizza Hut hired a summer “Twintern” whose sole job was to manage the company’s social networking presence. Soon after the hiring, the Pizza Hut Twintern offered free pizza (with the purchase of a pizza) to anyone that followed the company on Twitter or Facebook. Pizza Hut has continued to use these mini promotions to build its social networking presence, and therefore its brand awareness. It now has over 1 million people as “fans” of Pizza Hut on Facebook and over 22,000 people following it on Twitter. Clearly Pizza Hut’s social networking promotions were successful, seen by the fact that they are continuing the promotions and that they hired the Twintern on full time in October.
So we’ve seen that wireless consumers are using social networking sites, those with a social networking account are interested in special promotions and deals from their carriers, and the success of company’s using promotions and sweepstakes on social networking sites has been well documented. Of course this begs the question, what is taking wireless carriers so long to truly embrace the social networking sites … beyond merely setting up fan pages on Facebook and including links on the carrier Web sites. Who will be the first carrier to do something as simple as using a free smartphone giveaway promotion to engage shoppers and customers and jump out in front as the favorite (or at least most well known) carrier on the social networking sites? I don’t know the answer to that, but I do know I’d become a follower or fan of a carrier if it meant I’d be entered to win the newest and latest phone for free.
Becky Bitzenhofer is a Sr. Associate in Compete TNS’ Consumer Technologies practice and can be reached at [email protected].