TMAI #317: 👣 The Enduring Myth of Organic Social.

The Marketing < > Analytics Intersect, by Avinash Kaushik

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TMAI #317: The Enduring Myth of Organic Social.

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An adult discussion today, that applies to medium to large companies. It was sparked by two visits to Europe in the last six weeks – make what you will of it! :)

Someone shared a CNBC article said that Amazon flew “influencers” to an ultra-luxury resort in Mexico to get them to… well… influence. It jumped at me that Senior Marketing Leaders keep funding things that have a measurable track record of A. not working, B. not working at scale, C. no justification beyond vanity.

Or A AND B AND C.

“Influencer Marketing” is certainly one of them. The only people “Influencer Marketing” works for is the “Influencer.” They all get something out of it – a stay in Mexico, free food, and, more crucially, free content for their channels translating into, hopefully, more followers. The company gets an incredulous article on CNBC that Amazon is doing “Influencer Marketing.”

[Full disclosure: From time to time, as an Influencer, a box with really lovely headphones or tea or sports equipment does show up for me. I do not invite it, as I feel extremely queasy doing promotions.]

It is important to know that having Tom Cruise or Viola Davis as your spokesperson/sellers is a type of influencer marketing. If you stick with the same (hopefully uncontroversial) super famous spokesperson for a decade, their brand halo and reach can enhance yours… And, done right, also deliver incremental revenue/profits.

Getting me (approx. 500k social followers) to write about your phone or lipstick when you launch it is a very, very, very poor way to deliver business value (brand lift or revenue). Computing that is not all that complicated.

1. Influencers will only write for you once, or, if your “Influencer Marketing” does not completely suck as a one post deal, it will only last the duration of, say, a handful of months over the course of the sponsorship.

2. Their followers will easily smell the sponsorship. (Though that does not mean a tiny handful will not buy.) Almost all will be ignored.

3. The actual Organic Reach of your fav Influencer (ME!) is not the 500,000 followers they have on Facebook/Instagram/TikTok, it is, 500000*0.03 – since Organic Reach on social platforms is now 3% (or less).

That gives you 15,000 Reach, with low digits AVOC you would be lucky for 1,000 followers seeing the full Organic post.

Let me give you an outrageously generous 1.2% Conversion Rate, do the math on 1000*0.012 to get Revenue.

Finally, compute Profit = ((Revenue) – (Influencer Fees + Execution Costs + COGS)).

For you, that is likely Profit = ((Revenue) – (Revenue*0.85).

You got almost nothing.

That’s your item A from above (does it work).

With the above terrible math, the only way to solve for scale (item B above) by hiring 10,000 or 20,000 Influencers to each deliver you almost nothing. Perhaps (almost nothing * 20,000) is a lot.

Can you hire 20,000 Influencers?

That leaves executing “Influencer Marketing” for item C: CMO or VP Marketing Vanity.

When marketed well inside the company, by sending celebratory emails/decks with screenshots of random tweets and instas and random potential Reach or Follower counts, that could lead to getting PR for the VP of Marketing and job promotion for you.

I’ll let you decide if the cost of doing Influencer Marketing (needing investments in creative to employees to social agency fees to a whole lot more) is justified by your job promotion. I, sincerely, do not begrudge you for investing all that money, time, people, fees into your personal job promotion or stroking your CMO’s ego. In some company cultures, that is what it takes and, hey, you are only human.

What’s clear between the two of us here is: You ain’t doing “Influence Marketing” to deliver business value.

There is simply no short, medium, long-term data that justifies handing over free products, vacations, cars, sports equipment, lipsticks, to Influencers.

You could get 12,000 conversions by making your next email marketing campaign 5% better, or improving SEO by 10% or unsucking the creative you put on TV by 15% or buying 50 billboards in your largest revenue city or… Doing any of the unsexy 25 other things your data already shows you know how to do really well.

For almost all companies (outliers like KimK excluded)...

“Influencer Marketing” does not work.

“Influencer Marketing” does not work at scale.

“Influencer Marketing” tempts fate by becoming a job employment scheme for company employees, through a potential expression of Marketing Leadership vanity.

But wait, it’s about the future of Marketing.

At this point, I get attacked by all the Influencers and “Influencer Marketing” Agencies with random data from their perspective drawn from questionable one-time “studies.” Let me save them some energy/an email/tweet: This does not bother me. I have access to your performance data. 😊

At the same time, I also get two justifications for “Influencer Marketing” from Marketing Leaders I’ve worked with over the years:

Justification 1 (J1): CMO: It does not matter that Organic Reach is between 0% and 3%, we can always buy Paid Amplification of our Organic Social postings and buy Reach.

Justification 2 (J2): CMO: We are doing Organic Social to teach our employees how to become future Marketers because TV and Google and Paid Ads of every kind are dead. We need our Marketers to speak to the kids.

[First, notice the subtle shift away from “Influencer Marketing” and on to Organic Social. All good Analysis Ninjas notice when the goalposts get switched. Second, “Influencer Marketing” could possibly be a type of Organic Social strategy, so I’m going to cut them some slack. For the rest of this newsletter though, I’ll focus on Organic Social. That is, you posting content on your company/brand’s TikTok page or Instagram account or YouTube channel.]

Let’s tackle J1 and J2 with some pictures, and illustrate how they almost certainly ring hollow – unless you are some kind so immense outlier. (You are not. I’m sorry.)

J1. Breaking social platforms limiting Organic Reach.

You can solve the Organic Reach chokehold by buying Paid Ads to run the Organic posts published by you or your expensive agency (or your “Influencers”).

It is extremely appealing because you keep reading that:

4 BILLION PEOPLE ARE ON TIKTOK

YOUTUBE IS THE FASTEST GROWING CHANNEL WITH DEATH OF MEDIA

INSTAGRAM ADDS THE EQUIVALENT OF THE POPULATION OF THE COUNTRY OF SENEGAL EVERY HOUR.

Your VP of Marketing reads that, and they are totally right to be excited because all of that equates into a MASSIVE audience.

In that several billion people on the Social Media platform, let’s say you are some insanely massive company like L’Oreal and have 36 million Social Followers. (Your company sadly only has 40k or 200k Followers, but let’s stick with L’Oreal as they likely invest millions upon millions on Organic Social.)

When L’Oreal posts something on TikTok or Facebook, 4 BILLION people don’t see their content. It is, let’s go with 36 million * 0.03%.

A tiny, tiny, tiny number in the context of 4 BILLION.

Of that, a very, very, very, tiny, tiny, tiny number, on average not exceeding 50 will Like the content, 5 might Comment on it, and between zero to three will Share the content.

If you can’t read what you get at the end, you are getting the right experience.

L’Oreal (or IBM or Chipotle) makes Organic Social posts every day, but remember a different 0% to 3% of their Followers will see the daily posts. This gives you no continuity in communication with a fixed audience. Then, even fewer people over time Like, Comment, re-Share your Organic Posts, making the Social Algorithm think you suck, sending your Organic Reach from the 3% number towards the 0% number.

Worry not. We can pay Facebook or other Platforms to amplify our Organic Social posts!

Yes.

You give them a monthly $50k or $500k, to several million if you are a Very Large Company, and more people who Follow you (if you target well) or more people who don’t follow you.

Not everyone who follows you, that would be too expensive.

But at the end of this $50k or $500k payment each month you can get a few more Likes, Comments, re-Shares, and maybe, if your Social Agency is good at Business Analytics, some more Revenue.

On a 4 BILLION original enticement, this is still an ignorable rounding error in your company’s Brand Metrics (Unaided Awareness, Consideration, Purchase Intent) and even smaller rounding error on your Performance Metrics (Orders, Revenue, Profit).

Even if you do this for a year, the above is true.

All these numbers will suck. (You don't need to trust me, just visit any Social page of any brand, the numbers are all right there.)

If you believe you are some exceptional outlier and only larger companies we've mentioned spend money on amplified Organic Social… You have either not looked at your Organic Social data or you are choosing to be deliberately blind to you.

Your company has been doing Organic Social for five or ten years. You have that much data to look at. Please take a look at it.

Is investing your marketing budget in breaking Social Platform limits on your Organic Reach justified?

No.

Thought Experiment:

Stop all Organic Social postings (repurpose employees, pause your Social Agency) and hand over that $50k or $500k or that several million Organic Social amplification budget to your Paid Media team. Ask them to run plain old ads on YouTube, Facebook, TikTok, your VP of Marketing’s fav Social Platform this month.

You will find that there is indeed a big audience on Social Platforms. 4 BILLION! You can reach the same demographics, psychographics your ads are reaching on Non-Social platforms.

Measure success starkly in terms of the same short-term Performance Metrics (Orders, Revenue, Profit) or medium-term Brand Metrics (Unaided Awareness, Consideration, Purchase Intent).

If your Ads are good (more on this in a moment), you will find good results if you don’t suck at Paid ads (then you know what to fix) and poor results if you suck at your Paid Ads (then you know what to fix).

If the data demonstrates you don’t suck, increase your investment on TikTok, YouTube, Instagram over time.

At the end of this thought experiment – and I’m assuming YOU ROCK – your picture looks something like this…

Pure Organic Social with no amplification has no justification. Has not for a decade.

Organic Social with Paid Amplification has no justification of the ROI. Check your data.

For some brands, Paid Ads delivered on Social Platforms can have ROI.

Check your Brand Surveys and Google Analytics reports.

J2. Teaching Marketers the future of Marketing.

There is some truth to this.

It does feel like aggressive, interruptive advertising on TV or in the middle of a baseball pitcher pitching or high frequency Paid Ads on Facebook or even Email are less effective every day. There's also the challenge that the audience's attention is fragmented (channels, sites, apps, multi-screen, etc.).

VPs of Marketing are getting even more dramatic frames thrown at them: Not a single person below 21 does a Bing or Google search because they prefer to search on TikTok, ergo, Google’s dead. All the old and uncool platforms are dead, dead, dead.

So, only super old people who are 45+ (me, you?) are on old uncool platforms and everyone under 21 is on their phones and TikTok and Discord and all the cool platforms where their attention is fragmented.

Since Marketing VPs don’t want to get stuck with super-old people, on uncool platforms, they are pressing Organic Social as a core strategy for their Marketers to learn how to connect with Gen Z/flavor of the month name for “youth.”

The hope is:

If we participate in Organic Social, we can get what the youth (/social audience) connect with, and we train an entire new generation of Marketers in our company how to build better creative (for ads, email newsletters, print, whatever).

At the core of Justification 2: Make less sucky creative, in the native environment of the youth.

Premium members know better creative is a noble quest in my eyes. (TMAI Premium #294, #273. Email me if you can’t find them. READ THEM!)

This noble quest is dead on arrival.

DOA 1.

Scroll back up. Don’t read all the words, just look at the pictures. Just the third one.

Is there any possibility that your Marketers will learn anything from reaching a different 0% to 3% of your Followers every day?

Even if they are making content youth / Gen Z love, content that does not look or feel like ads at all?

Again, noble quest, and so generous of you to post content with no expectation of ROI and only to teach the Future of Marketing. But, if you reach no one, or a different no one with every post, is there any possibility to learn?

DOA 2.

Organic Social posts that do not look at ads at all, do not have ad content, they are just Chipotle posting Roblox videos on its TikTok channel. (Is there a more potent drug for kids than Roblox? No!)

What does Chipotle get out of this Organic winning?

Followers and Like. Maybe re-Shares.

But. You already know from above that these three things are worth almost nothing due to limited Organic Reach.

And. Given the average tenure of a CMO is 40 months, will your company keep positing that Roblox videos (or, whatever the youth will be into next month and the month after that and next year), to build enough connections with the youth to shift Brand Metrics over the decade they will need to be shifted?

DOA 3.

Would it not be better for your Marketers to learn the Future of Marketing / how to market to Gen Z/youth flavor of the month, by simply doing active and extensive content experiments using Paid Ads on YouTube/TikTok/Facebook/HotSocialPlatform?

(The answer is yes.)

It is a very expensive suboptimal strategy to use youth channels and content that is not ads to teach your Marketers the Future of Marketing.

Many of these youth channels have options to run Paid Ads, just use them to learn how to create effective content that is not advertising to connect with youth.

Don’t forget to set short and medium-term ROI to zero (or negative) so that your Marketers don’t feel the pressure to make their not advertising content to connect with youth into ads to deliver ROI.

My recommended plan, for a difficult, Marketing, road ahead.

Your VP of Marketing or CMO is likely investing Organic Social in all ways that are not all effective and, sadly, won’t deliver any real ROI. (And then you as an Analyst will be scapegoated, TMAI Premium members see #305 and #306 for effective strategies to avoid being scapegoated!).

But.

The youth are certainly on newer channels. (No TV is not dead. See TMAI #277!)

Sucky ads work less and less with the youth (let me rush to add, they work less and less for my fellow super olds)..

Sucky ads delivered exclusively on existing channels (TV, Email, Facebook) certainly will put a pinch in your Marketing’s Incrementality. (See TMAI Premium #307.)

I recommend:

Invest in Paid Ads on Social. Judge their impact just as you would any other channel. If they have positive results, invest more. If they are poor results, don’t invest more.

If your company is delivering an ad on any platform (or doing any Owned or Earned Marketing) learn how to suck a lot less at the creative. Put creative in market that connects with the intended audience, not your Marketing team/leadership.

When you deliver better creative, invest in getting better at shorter and shorter ad lengths. As all the channels where attention is flowing only have very short ad lengths available. (Even in old channels, don't be shocked to find the AVOC to be 2 seconds!)

Experiment with any new platform for Organic possibilities, but six months in, take a naked and transparent look at reality (data!) and have the courage to pull the plug or pour more resources. Courage. In short supply, usually.

The second secret of winning on every channel – past, present, future – is building a great media plan. Frequency. AVOC. Solving an actual company problem (KPI, Baseline). Campaign duration. Spike and Sustain and not Spike and Silence. Be honest at how good you actually are at these five elements.

Build better products. If you had a great product at one time, evolve with your audiences (as they both grow younger and older). Your company is not under an existential threat because your Marketing team sucks – their incremental value is between 0% to 18%. Your company is under an existential threat because your product has not evolved as your customers – current or future – have evolved.

[It goes without saying that, as a super old person, I take offense to this youth obsession by some CMOs, and some Agencies. Choosing to spend extraordinary Marketing focus on people who have no money – and won’t for a while – at the cost of people who actually have money. If you are good at Marketing, you know how to walk and chew gum at the same time.]

Bottom line.

Build products that solve actual, current, future, customer problems.

Don’t build products for your VP of Products or CEO. (They are outliers. They are a niche.)

The flavor of the month will pass, at least plan your Marketing vision for the duration of your employment and not just the current quarter.

Experiment, with courage. Media plan with data. Build creative, with honesty.

Good luck.

-Avinash.

PS: Special Bonus:

If you are in the 0.01% that made it through this newsletter, and you STILL want to do Organic Social… One brand that has done it right, for a decade no less, is Innocent. Visit them on Facebook.

Obviously, notice the engagement numbers for all three Best Social Media Metrics. But then, notice the content. What it is they are posting. Notice the consistency. Notice the quality. Notice their proactive engagement in comments. Notice their joie de vivre.

Then ask yourself this question: Do we have it in our corporate DNA to truly post content that entertains, informs, provides utility? Content where the point is not to make money, ever?

The answer will be no. You don’t have it in your corporate DNA.

But, if the answer is yes…. Go forth and prosper!

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