Return On Influence: The Revolutionary Power of Klout, Social Scoring, and Influence Marketing

Return On Influence: The Revolutionary Power of Klout, Social Scoring, and Influence Marketing

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by Mark Schaefer

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Winner of a Choice Magazine Outstanding Academic Title Award!

We are on the cusp of a marketing revolution.

And it is being led by you.

Return on Influence is the first book to explore how brands are identifying and leveraging the world’s most powerful bloggers, tweeters, and YouTube celebrities to build product awareness,

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Winner of a Choice Magazine Outstanding Academic Title Award!

We are on the cusp of a marketing revolution.

And it is being led by you.

Return on Influence is the first book to explore how brands are identifying and leveraging the world’s most powerful bloggers, tweeters, and YouTube celebrities to build product awareness, brand buzz, and new sales.

In this revolutionary book, renowned marketing consultant and college educator Mark W. Schaefer shows you how to use the latest breakthroughs in social networking and influence marketing to achieve your goals through:

  • In-depth explanations of the sources of online influence—and how they can work for or against you
  • Interviews with more than 50 experts, including tech blogger Robert Scoble, Influence author Robert Cialdini, and industry thought leaders such as Mitch Joel, Jay Baer, and Christopher S. Penn
  • An insider’s look at the controversial social scoring company Klout and its process for assigning influence numbers to everyone
  • Practical, actionable tips to increase your own personal power and online influence
  • More than a dozen original social influence marketing case studies

Even if you already use social media platforms such as Facebook, LinkedIn, YouTube, Twitter, or blogging to maintain an online presence, this eye-opening, action-ready guide shows you how to reach the “superconnectors” who ignite epidemics through word-of-mouth influence . . . and become one yourself.

This is the future of marketing at your fingertips: low-cost, high-speed, influence driven, and powerful. Filled with fascinating case studies, interviews, and insider advice, this essential guide prepares you for the next wave of social networking. This is how to win friends and influence people in the digital age—with a Return on Influence.

Praise for Return on Influence:

“Influence is the ability to cause, affect, or change behavior. Mark Schaefer helps you define the outcomes you wish to see . . . and measure them!”
—Brian Solis, author of The End of Business as Usual

“Schaefer’s book has earned its place on the shelf of anyone looking to find influencers—or become one.”
—Harold Burson, founder, Burson-Marsteller

Return on Influence is definitive, exciting, and endlessly practical. In an age where marketing budgets are tight and getting tighter, social media—and particularly influence marketing—has become the silver bullet to solve all problems. Consider this book the marksmen’s manual.”
—Rick Wion, Director of Social Media, McDonald’s

“I could not stop reading this book. Mark Schaefer demystifies the power of influence in this insider’s guide to combining content strategy with network interactions to create social conversations that move markets.”
—Ardath Albee, author of eMarketing Strategies for the Complex Sale

“A fascinating exploration at how you track and increase your online influence. Real-world strategies for real-world companies.”
—Randy Gage, author of Prosperity Mind

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Editorial Reviews

"This book is a pathfinding contribution on how social media platforms are reconstructing the traditional concept of influence. Schaefer demonstrates that the world of social media has enormous consequences (opportunities and problems) for people and organizations that seek online power and influence. The book is supercharged with examples, interviews, and case studies detailing the experiences and thoughts of industry leaders. Among the many attractive attributes of the book are appendixes that feature an excellent social media primer and a description of how the leading websites and platforms measure online personal influence. Schaefer offers a splendid description of Klout, the undisputed market leader among companies that measure the level of online influence. Many practical ideas are put forth on how to improve a Klout score by building a relevant network; a clear strategy to provide compelling content; and a system to engage those influencers and advocates most likely to distribute one's content virally. The book is essential for those who want a thorough understanding of online influence—how to gain it and why it is so important to organizations and individuals. Summing Up: Essential. Marketing and social media collections at all levels."

Library Journal
Marketing has always been a numbers game—and now it's getting personal. In his new book, previously self-published author and marketing consultant Schaefer (The Tao of Twitter) explains the concept of online social scoring. Through timely and relevant anecdotes, helpful appendixes, and an accessible writing style, he successfully guides both veteran social media users and laypeople through the world of social influence—how to get it and how to use it to best advantage. Schaefer moves smoothly and effectively through a number of concepts important to becoming a "citizen influencer," e.g., validation, scarcity, likability, authority, reciprocity, content, and algorithms. The author delves into the development and growth of the social scoring website Klout and addresses the moral issues surrounding online social ranking and scoring mechanisms used to determine social influence. The book concludes with examples of different models of social marketing that can be applied to varying audiences and product scenarios. VERDICT Highly recommended for anyone interested in the sociological as well as the practical impacts of social media and marketing.—Poppy Johnson-Renvall, Central New Mexico Community Coll., Albuquerque, NM

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McGraw-Hill Professional Publishing
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Copyright © 2012 McGraw-Hill
All right reserved.

ISBN: 978-0-07-179110-6

Chapter One

The Rise of the Citizen Influencer

If you haven't heard of Klout and the emerging field of social influence measurement, you probably will soon as these measures wind their way into mainstream life. If you're active on Facebook, LinkedIn, Twitter, or YouTube, it's likely that your score is being assessed by a major company or brand right now whether you realize it or not.

Klout is one of a number of new status-measuring companies whose purpose is to curate billions of individual pieces of information, apply complex mathematical algorithms, and feed that information to businesses in ways that will create new marketing programs aimed at selling more of their skin care products, cars, and movies.

It's turning into big business, creating a new marketing gold rush. Some of the pioneers in the field characterize this new ability to identify word-of- mouth influencers as an important development in the history of business. For the first time, the world's biggest brands have a way to cost-effectively and rapidly identify, connect with, and nurture customers who are their megaconnectors in niche markets.

When Virgin America opened its Toronto route last spring, it asked Klout to find a small group of influencers to receive a free flight in hopes that they'd effectively spread the word. "We offered 120 free flights for this campaign—all of which were booked within a matter of weeks—so we were very pleased with how much enthusiasm was generated to take advantage of our offer," said Porter Gale, who was cited in AdAge and was then vice president of marketing at Virgin. "We saw a ton of social media buzz and press around the campaign, which definitely helped to build awareness for our brand and product in the Toronto market."

After the initial 120 participants and an additional 144 engaged influencers had been accrued, the word-of-mouth power kicked in as those highly social individuals generated more than 4,600 tweets about the new route. That led to more than 7.4 million impressions and coverage in top blogs and news outlets such as the LA Times and CNN. All it took was making those original 120 people feel special.

Think about it: 7.4 million impressions and coverage in top media outlets. That's hard, cold measurement for marketers, who are always struggling with the notion of building brand awareness. Those campaigns didn't depend on expensive celebrity spokespersons, Hollywood personalities, or sports stars. The platform has the potential to bring true celebrity status and all the associated perks to anyone who is willing to work for it. Anybody has a chance to experience life on the other side of the velvet rope.

Even Calvin Lee.

The Citizen Influencer

Lee, a graphic designer employed by the city of Los Angeles, may be the poster child for the new class of Citizen Influencer. He was one of the lucky ones on that free Virgin flight to Toronto simply because he is an authentically nice guy and a massive tweeter. "I'm addicted," he joked. "I really can't stop."

He's about as humble, quiet, and mild-mannered as any person you are likely to meet. When I interviewed him, it was difficult to get more than a few sentences out of him at a time. But in Twitterland, where success is defined on the basis of the ability to express oneself in just 140 characters at a time, the shy Lee has become a rock star.

"I've gone through life wondering what my 'thing' would be. I believe I've found it ... well, more like it found me," he said. "Twitter is really what started it all for me. I've never thought of myself as being in social media. It kind of just happened. Now I love it."

Lee, who describes himself in his Twitter profile as a "social media ho," has become a human news service. "I tweet at least 200 times a day," he said. "Anything that interests me: food, travel, entertainment. And of course design and social media. I look for interesting links from my friends and sift through them for good stuff I like. I love engaging with my community. I try to be a resource for them. I share what I enjoy in my life, and I'm very transparent about everything I do. I tweet photos from my life and talk about things I enjoy. I think people feel that I am a real person and part of their lives."

He has apparently been quite successful, amassing nearly 80,000 followers on Twitter. But more important, it is a highly engaged audience whose members seem to appreciate his work ... for the most part. "I have a few haters," he said. "People who say I tweet too much or whatever. But that's the beauty of Twitter. There is always that unfollow button!"

Like any good networker, Calvin Lee frequently moves his online relationships into offline friendships, especially by attending conferences. I first met Calvin at the South by Southwest Conference, an annual event in Austin, Texas, that frequently is described as spring break for geeks. It's also the place to see and be seen for the Twitterati. He was instantly recognizable by his wide grin and the shock of porcupine-like black hair poking from the top of his head.

"I was not very popular in high school," he continued. "But now I'm like the big jock on campus. It's amazing. I can walk around a big conference, and everybody seems to know me. I've even been recognized just walking down the street."

When Lee tweets, people respond, and his growing influence has won him celebrity-status perks. In addition to the free airline ticket, brands have reached out to him and provided

* A brand-new Audi A8 to test-drive for a week

* Hundreds of dollars in gift cards from American Express, Timbuk2, and other brands

* A pass to the House of Blues VIP event at the private Las Vegas Foundation Room club

* A free Samsung Focus smartphone and an invitation to the launch party for the device

* Flight, hotel, and meals to attend an exclusive conference featuring speakers from Facebook, Foursquare, and Zynga

* Eight passes to the VH1 Do Something Awards, where he hobnobbed with Hollywood celebrities

Calvin Lee doesn't have the trademark characteristics of a celebrity influencer, does he? He doesn't exert his power through TV spots or news interviews. He's not an accomplished musician, athlete, actor, or politician. Calvin doesn't live in a mansion in the Hollywood Hills. He doesn't have an Ivy League degree; he went to a trade school and attended a community college.

But he's massively present on the social web. On average, he is sharing some piece of content every five minutes, 24 hours a day, 365 days a year. Calvin is nice to people. He helps his followers in any way he can and tries humbly to provide value with the information he shares. "Building a following on Twitter is like providing great customer service," he said. "I'm always there to help a friend, charities, and my community."

He also helps create positive content about the brands that are connecting with him, and that content hums and buzzes throughout his vast network and beyond.

"An extra bonus of all this sharing and helping is that it somehow created influence and trust for me. Brands have been reaching out to me, sending me on trips and asking me to try their goods and services, and they want me to review their products. I'm not sure that would have happened without the exposure I got through Klout," he contends.

Lee knows that to stay in that rarefied air of being the everyman of celebrities, he has to keep his presence and his content sharing at a very high level. "I do feel some pressure. I got to this level, and I don't want to slip. So I'm always tweeting at my work breaks ... even on vacation. I never stop."

But the new influencers don't even need a massive number of followers or years of experience on Twitter. They just have to make things happen.

Take Charles Dastodd, for example. He has less than 5 percent of Calvin Lee's followers. On the list of the most followed people in Chicago, he doesn't even crack the top 1,000. But as the Chicago Tribune reported, Dastodd is among the top 10 social media influencers in the city.

He uses Twitter, Facebook, and Flickr to promote his unique photography and provide an escape from his doctoral work in the humanities at the University of Chicago. But when he tweets about photography, people respond. He started getting requests for event and portrait photography from his followers and messages from photographers seeking advice on starting a business or improving their portfolios.

That kind of influence was detected by the social scoring algorithms at Klout, and he was approached to attend a celebrity event at the Museum of Contemporary Art in Chicago exclusively for people with high Klout scores.

From now on, you don't have to be George Clooney or Lady Gaga to get an invitation to the exclusive world behind the velvet rope. We're at the dawn of a new era of the democratization of influence.

This concept is revolutionary. Or maybe, in a way, we're returning to the very roots of influence: conversations between real people that make something happen.

After all, the first markets were conversations, simple places where people gathered to exchange information and goods: a city market or a town square. Supply met demand with a firm handshake. Buyers and sellers looked each other in the eye, met, and spoke directly to one another without the filter of media executives, the manipulation of marketing, the arrogance of advertising, or the positioning of public relations. People bought and sold goods and services to people they knew and trusted.

There is a lot of buzz about social media ushering in this new age of conversation. This is untrue, of course: The conversation was always there. We just couldn't find it because it was interrupted for a few decades by the introduction of broadcast media. Social media platforms allow us to start to reclaim the conversation with our customers, even in a complex global marketplace.

Marketing, Interrupted

Beginning with radio and then TV, companies discovered the efficiency of moving from selling goods such as soap, cereal, and bread through local producers to manufacturing in bulk and marketing through mass media. Undoubtedly it worked, and still does, with powerful efficiency. But at the same time, the conversations were happening without the benefit of the local marketplace. Influence was obscured or pushed into homes and suburban neighborhoods. Success was measured by advertising "impressions," assuming that those impressions were going to hit at least some of the right people at some of the right times.

In that era, approximations for market conversations had to be created. This was the golden age of polling and focus groups. We had to create conversations when we lost touch with the community marketplace.

The Conversation Renaissance

In 1999, a seminal and visionary book, The Cluetrain Manifesto, was published. Authors Christopher Locke, Doc Searls, David Weinberger, and Rick Levine saw that this emerging Internet technology could help us recapture those historic market conversations, as it stated:

In the early 1990s, there was nothing like the Internet we take for granted today. Back then, the Net was primitive, daunting, uninviting. So what did we come for? And the answer is: each other. The Internet became a place where people could talk to other people without constraint. Without filters or censorship or official sanction—and perhaps most significantly, without advertising.

When Cluetrain was written, there were just 50 million people on the Internet, most of them with AOL dial-up accounts. And yet it correctly foretold the potential for mass conversation, the opportunities for influence, and the inherent fear traditional advertisers would have of giving up control of the dialogue.

The market conversation that became lost in the mass media megaphone was found again in quiet discussions in geeky chat rooms and news exchanges on the first Internet sites.

Conversation as god

Within 10 years of the publication of The Cluetrain Manifesto, two trends collided that not only reenergized the idea of conversation but elevated it to superstar status. The first was a critical mass of diverse demographic categories actually accessing and using the Internet. The web went free, fast, and global.

The second was the emergence of user-friendly, enjoyable, and helpful sharing sites that collectively became known as social media. This allowed people to connect, comment, and publish quickly and easily. For the first time in history, our civilization could conduct free, global, instantaneous conversations. It was momentous. Now when companies spoke, people started talking back!

Everybody became a publisher: customers, suppliers, and employees; community members and activists; people who loved you and people who hated you.

They contributed videos, blogs, comments, updates, tweets, music, art, reviews, photos—every imaginable type of content, billions of pieces of it every hour of the day. And your company had better be in tune with it. The idea of influence hit hyperdrive. As one marketer friend put it, "The deer now have guns!"

The popularity of social platforms naturally attracted large corporations, advertisers, and search engine optimization (SEO) alchemists. By 2009, companies both large and small had joined the social media frenzy, trying to make sense of the unprecedented amount of direct consumer information that was flooding the airwaves.

Sophisticated listening programs emerged that could slice and dice consumer sentiment, monitor competitor activities, detect shifts and trends, excavate potential problems, and, perhaps most important, begin to link consumer online activity with market influence.

Driven by the belief that a recommendation from a friend or trusted peer carries more weight than an impersonal advertisement, brands were eager to find consumers who could motivate others in their online spheres to take action or try a new product. This realm of social media marketing is potentially lucrative for companies seeking fresh ways to reach potential customers who are spending more of their lives online. Identifying and connecting with Citizen Influencers became paramount for many brands. Not being part of the conversation can be perilous.

A New Kind of Conversation

Here's an example of this new kind of customer conversation in action.

My wife and I decided to celebrate for no particular reason and go out to a favorite restaurant we had not visited in at least six months. We were seated at our table promptly.

When my wife went to the restroom and I wanted to pass some time, I checked into this restaurant by using the Foursquare application on my smartphone. Foursquare is a useful tool that allows you to view deals and reviews at just about any location you could visit and even see if you have any friends nearby.

When I checked into this location, I was surprised and delighted to see a review from one of my best friends pop up on my screen. What a coincidence. He had been to the same restaurant just that week. Here is his review:

This restaurant has always been a family favorite but the service has really gone downhill. I'm convinced the management and staff don't even care anymore.

Wow. My friend is a very kind and patient man, so the service must have been absolutely horrible for him to leave a review like that!

My wife returned to the table, and after 10 minutes we still didn't have anybody take our drink order. Normally, I would have been engaging in conversation with my wife and probably not even noticing the delay, but now my Spidey senses seemed to be tuned fully to the service level.

It occurred to me that I was now expecting poor service because of my friend's review. Whether we had a good waiter or not, I was closely watching for signs of problems.

"Don't you think the service here is slow tonight?" I asked.

"Well, maybe," my wife responded. "But I've noticed that the waiter had a lot of tables getting their food at the same time, so I think this is probably normal."

She had not received the same influential message I had, and so she had a totally different experience with the restaurant. She was looking forward to a nice meal at a bustling restaurant. I was looking forward to slow service.

This is how the power of an online influencer can work for or against a business at any moment. I had not seen my friend or spoken to him about the restaurant, yet his power was extending beyond space and time to me and who knows how many others. This is a new kind of conversation, isn't it? Asynchronous, permanent, searchable, and powerful.

An advertising image may be fleeting and ignored. A television commercial is viewed with suspicion. But a Citizen Influencer like my friend can have a long- lasting influence in his or her sphere of connection and engagement with just two sentences of original content.


Excerpted from RETURN ON INFLUENCE by MARK W. SCHAEFER Copyright © 2012 by McGraw-Hill. Excerpted by permission of McGraw-Hill. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

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