Over the past couple of weeks we have looked at some of the great benefits that can be gained from the implementation of Enterprise 2.0 and some of the risks that need to be considered. After careful thinking and thorough research, together we have come to the conclusion that the benefits far outweigh the risks and if an organisation really wants to keep up with the Joneses (so to speak) they need to get in amongst it and make and effort to make use of some of the wonderful tools that Enterprise 2.0 has to offer. So that begs the question, (in the words of Miss Lara Bingle) “where the bloody hell are they?”. In this day and age, any company that isn’t making use of some sort of Web 2.0 tool needs to wake up and smell the coffee, and I mean that literally.
Photo: Alamy
Did you know that since 2008 when Starbucks was suffering from declining sales for the first time since it stared, they have become one of the most highly engaged companies in social media and are once again back in favor with consumers announcing record profits for the 2012 3rd quarter (Starbucks Investor Relations, 2012)? It’s true! In 2008 Starbucks had lost itself and was as a result losing customers. They were looking for a way to re-connect with their customers and one of their barristers (Mr Brad Nelson) had the ingenious idea that they should engage with their customers via Twitter. This idea was originally dismissed by management, but Mr Nelson was persistent, he put together a presentation about the benefits of Twitter and how it could be used to connect with customers. His idea was eventually given the green light and the rest as they say, is history.
Image: Starbucks Corporation 2011 Fiscal Report
Starbucks now have over 2 million Twitter followers, nearly 32 millions fans on Facebook and nearly 14, 000 subscribers to their youtube channel.
In addition to this, Starbucks have also implemented their very own social networking site called My Starbucks Idea where customers can make suggestions about what they would like to see from Starbucks. They also have a blog called Ideas In Action which is written by Starbucks staff about what Starbucks is doing with the ideas that have been made by customers on My Starbucks Idea.
It took Starbucks a good four years to cement their digital branding, and with the recent appointment of a Chief Digital Officer, it seems that they have finally realised that Enterprise 2.0 is the way of the future, and really, resistance is futile.
Starbucks have adopted social media tools not only as a way of connecting with their customers, but as a way of harvesting ideas and collecting data. When Starbucks entered the social media scene, it was done with complete conviction. Facebook, Twitter, the Starbucks blog, and their own social network all launched at once, showing commitment by management and confidence in what they were doing. In 2009 as a way of encouraging staff to participate, they ran a competition where employees could submit ideas for future ads. This reward scheme was the perfect way of engaging staff. My Starbucks Idea and Ideas in Action also used this method of encouraging consumers to contribute because each idea that was submitted was reviewed and had the potential to be actually implemented. This encouraged customers to make use of the social media tools provided and gave Starbucks the perfect platform for gathering data that they could then analyse to determine what their customers really wanted in order to improve the service that they deliver. The main thing that Starbucks did with the adoption of Enterprise 2.0 that made it such a success, was switch their focus from the company to the consumer. This push came from management and filtered down to staff level.
So why aren’t more organisations following suit?
Image: icanhascheezeburger.com
Well there are a number of things that can hinder the adoption of Enterprise 2.0 by an organisation, such as concerns about security, concerns about the risks to core business practices etc, but personally the one that I’ve witnessed most within my organisation is simply that people are creatures of habit and that they are scared of change. If there is no immediate need to change, most people are happy to continue on doing what they are already doing. Most middle to high level managers (who are the people who would be responsible for approving the introduction of these sorts of tools) are still within the age group where Enterprise 2.0 is still sort of foreign and just a little bit intimidating. Until it can be proven to them how beneficial something new can be, whether that be via a ROI report or they see that their competitors are doing it and doing to well, chances are they are going to remain skeptical on the issue. Employees are the same, unless they are forced to, or they can see some huge advantage in changing the way they work, they are just going to stick with what they know. As the next generation starts to rise through the ranks, I think that is when Enterprise 2.0 will really start to gain momentum within organisations. Once again, this is just my opinion, what’s yours?
References:
Starbucks Investor Relations
New York Times: Starbucks Corporation
New Your Times: Starbucks Announces It Will Close 600 Stores
Altimeter: EngagementdB
The Next Web: The Starbucks Formula for Social Media Success
Venturebeat: Starbucks Digital Strategy
Starbucks Newsroom: Chief Digital Officer
Branding Personality: How Starbucks Built an Engaging Brand on Social Media
Advertising Age: Starbucks Gets it’s Business Brewing Again with Social Media
ZDNet: Top 10 Issues in Adopting Enterprise Social Computing
GSC: Starbucks Use of Social Media Keeps Customers Coming Back
Mashable: Starbucks Takes its Social Media Marketing Offline
candiceruddle 
Hi candiceruddle
nice post, I do like the full-force attack strategy by Starbucks when social tools all launched at once. I think that to some extend help them to harness its benefits and shape there digital identity in Social networks effectively. And I believe that could as well be implemented internally.
cheers
Please check my week 7 post: http://arifiabdul.wordpress.com/
Abdul
Hi,
Starbucks did really turn things around using social media. It is one of the most social media active enterprise even in Thailand where the concept of using social media in businesses are still young. It is hard to convince people to change to something else when the excuse they give goes something like “Well…..it worked before why not now?”. One way I have personally tried to tell people to adopt the use of social media is through practice. Once the higher up see that it is profitable, they quickly try to change. It is something they have to see to believe.
-Sukshan
Hi Sukhshan,
Thanks for the comment. You are so right that all managers need to be shown how profitable social media can be before they will give it a go. This makes it really hard to get it going in the first place, because it usually means a lot of extra work outside of your usual working role and not to mention additional unpaid hours. It seems most managers still live in a world where social media means wasted hours chatting with your friends and viewing funny videos. They seem to struggle to see that it can be used as a tool to encourage staff satisfaction, customer relations and increased productivity. When will they ever learn? 🙂
Thanks again for the feedback.
Social medias are great channels to engage with your customers. However, there are many aspect of social media you need to think before implementation.
-There are many risks in social medias.
-Your employees and especially the president and executives are low tech people.(people don’t like to change)
-your company only deal with low tech people who don’t use social medias
These are some of the reasons I can think of why people hesitate to implement social medias. It is good but sometime it might not be necessary for your business to be a successful business.
Cheers,
Prapat W.
Hi Prapat,
It’s true, not all business need to use social media to be successful, but none the less, it can be a handy tool. Even small business can benefit from making using of Facebook as a way of communicating with their customers. I must say that I am personally more likely to go out and eat at a restaurant if I can go and visit their company page and see that other people are saying nice things about the place. Having said that, if the page is poorly run due to the lack of technical knowledge of the people running in, then that doesn’t really help either. It’s all about balance really. Any company that is thinking about branching out into the world of web 2.0 needs to assess why they want to do it. Is is just to be in with the in crowd, or is there actually a business need for it? They need to consider what are the problems that they want to solve, how could web 2.0 help, and which ones would be best suited? Once they have determined these things, they need to consider the risks associated with making these changes and how they are going to prepare their business and their staff. Afterwards they need to assess whether or not the tools that they have implemented are being used correctly and that they are having the desired effect on operations. After that if things aren’t going as planned, they can choose to tweak them to better suit their purpose, or abandon them because they really weren’t suitable.
Thanks for your feedback Prapat, you always make me think just that little bit more about the message that I am trying to get across.
It’s a great example of illustrating how typical executives would react to the adoption of social media. There is always someone who is proactive enough to see the trend and catch it, and further put it into implementation. 🙂
I highly agree with what Starbucks has done for the adoption of social media, rewards are always better than regulations. People will be encouraged and motivated by rewards rather than rules.
CitiBank’s Facebook page has demonstrated this principle thoroughly as well. 🙂
Keep on your awesome work!
Thanks Edie.
Wow, I’d never been to CitiBank’s Facebook page before (odd considering that I have an account with them) but you’re right, it’s really good. Heaps of competitions and offers, the perfect way to draw people in. I too think that rewards are the best way of encouraging positive customer relations. It makes regular customers feel like they are important, and encourages occasional customers to visit more often.
I really appreciate your feedback.
It’s a good point. Now that CRM systems are well understood by executives there isn’t the same need to educate corporate decision makers on what a CRM system is unlike Brad Nelson’s approach of educating Starbucks managers on social media and twitter. However I think that’s just one barrier to overcome, any organisation about to invest in a new application or way of workin, whether it’s CRM or social media, needs to prove that the benefits outweigh the costs. Great post, you’ve done a great job higlighting some ofbthe barriers.
Hi Amanda.
Your right, just like any new project or work practice, there needs to be evidence that there is an advantage to making the change. We (as very smart Enterprise 2.0 experts and general tech heads) know about the benefits that implementing social media in the workplace can bring, but just having that opinion isn’t going to convince management that they should change the way they run their company. Proof through research and trials needs to be gathered so that claims can be backed up with hard evidence. And as we all know from this week’s alternate assignment topic, providing a ROI figure to management for enterprise 2.0, isn’t all that simple.
Thanks for the comment.
Hi candice, using Starbucks as an example was great! Enjoyed reading your post. By reading this example, I realized that the key to their adoption was actually Brad Nelson’s persistence! If he hadn’t hung on this idea, Starbucks would not even venture into using these social media tools, hence losing all these great benefits you mentioned! Anyway, keep up your great work, will be visiting again soon. 🙂
Hey Candice
Great post – I remembered when there were rumors that Starbucks was going to close down, now you can’t walk down a street without seeing one!
They have done really well to not only grab that many followers/fans but to keep them as well – that’s another aspect you have to think about. How do you think Starbucks have been able to do this?
Alyse
Hi Alyse,
I think that once Starbucks got the attention of the consumers, they kept it by simply providing them with good customer service. They launched their social media presence with the purpose of re-connecting with their customers, and when their customers communicated their concerns and ideas to them, they responded. The listened to what people had to say and they acted on it. When people see that a company is making a genuine effort to improve their service, I think that encourages people to stick around. They also maintained an active presence on each of their social media sites. They Tweet several times a day, update their Facebook page regularly with new offers and respond to the posts of their followers and their blog is updated several times a week. In addition to this they now have several Twitter accounts and Facebook pages so that they can dedicate a separate feed to customers from different countries, giving them the ability to personalise their communications. The frequent updates keep customers interested and the good old scheme of offering rewards to customers wouldn’t have hurt their cause either.
Hi Candice, great article.
I loved the Starbucks example. A company that has virtually turned itself around to reach great profit margins due to an idea that came from a staff member. 2 million Twitter followers and 32 million Facebook fans are both VERY impressive figures and are sure to maintain a strong customer base in the future. The blog will keep staff interested as they won’t feel as though they’re being ignored (fairly typical of a large-scale organization) and as you said, it all comes back down to the consumer.
Thanks!
Mark.
Hi Candice, great article.
I loved the Starbucks example. A company that has virtually turned itself around to reach great profit margins due to an idea that came from a staff member. 2 million Twitter followers and 32 million Facebook fans are both VERY impressive figures and are sure to maintain a strong customer base in the future. The blog will keep staff interested as they won’t feel as though they’re being ignored (fairly typical of a large-scale organization) and as you said, it all comes back down to the consumer.
Thanks!
Mark. (Ps. Apologies if this comment duplicates, seems to be having a few connection issues)
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