Rewarding People For Social Media Activity

 

http://www.wired.com/business/2012/10/splurgy/

This Article featured the new social company Splurgy.  What they do is increase a brand’s social media presence by rewarding people for their social engagement.  Therefore, you may receive a coupon or gift if you give an endorsement or follow the brand.  People they deem social VIPs receive better coupons than the general population!  This ties into what we have talked about in class how the industry has moved away from CPM (Cost per thousand views), CPA (cost per acquisition), and evolved into CPE (cost per engagement).

Personally, this is where the idea of social media becomes a bit cheap.  I think giving away something like a free Chipotle burrito for a tweet is simply a bribe and not developing a life-long audience.  One of our classmates mentioned receiving a drink because she liked a restaurant on Facebook but never went back to the restaurant.  I think we are developing  a social culture that is based on cheap engagement.

The founders of Splurgy think the interactions are not cheap.  They think that if you are taking the time to endorse a brand or write a tweet for them then you are telling yourself and others that the brand is worth your time.

– If you are receiving a reward or coupon for your social media engagement is this cheap way for a brand to gain presence?

– Do you think this may be a legitimate way to drive presence and this will only expose a brand to new consumers and bring older consumers closer?

– What type of opportunity would make you tweet or follow a brand?  Do you have real life examples when you have engaged in social media and received something for it?

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3 thoughts on “Rewarding People For Social Media Activity

  1. For me, personally, I have used the Foursquare application to check into places in order to receive discounts for certain promotional items. If I noticed that a certain restaurant offered a free item or discount, I may decide to give the place a try. Who knows, maybe it might be my next favorite spot? If I end up having a bad experience, I know I can also take to social media and let my opinion be heard. Ultimately, both the restaurant and the customer benefit from this transaction. One increases their social media presence, while the other gets to enjoy a complimentary item. Win – Win if you ask me.

  2. I am actually the one who raised her hand about the free drink but never went back to the restaurant. Similar to what Rchandi commented above, I think its all about short-term engagement not necessarily a long lived experience. I think the CPE as the ‘now measure’ is very true in regards to advertisers trying to gauge just how many people are engaging in their brand/idea/product. I think that by offering freebies, endorsements, discounts, etc. does actually help spread the word about a brand. But it also does not necessarily commit anyone to longevity in the brand unless they have already chosen it as one of their favorites. In NYC, where there is a new bar/restaurant opening up ALL the time, I definitely feel more enticed to ‘like’ something on Facebook to get a discount or free drink if i want to try the place out. Like Rchandi said, if it’s a good experience, maybe I will develop long term with the brand/restaurant/etc but if I dont enjoy it as much as i thought, then hey, it was a freebie. On that note, if Splurgy thinks that by endorsing something via social media means that I am spreading the ‘good word’ to others and that the brand is worth someone elses time…then Splurgy is correct. If I do endorse a certain restaurant or store where I received a discount to shop there, then one of my friends might see that and want to do the same. They may reach out to me and ask about the experience, or they might just engage on their own without hearing my thoughts. Either way, Splurgy is right, the more endorsement by # of people, the more popular a brand might come….even if its only in the short term.

  3. I think giving away free stuff using social media might only raise short-term customer engagement. For Asian people, most of them are very price-sensitive and like to get freebies. Just take myself as an example, I use social media to get a lot of free samples. But I never buy anything else from the company that gives away sample. After I receive my samples, I just go back to my normal buying habits to find cheap products. But if the company sending out free samples is the cost leadership in the market, I would like to try their products if I’m satisfied with their sample. But for other social groups, this strategy maybe works better in the long term since some of the sample receivers are likely to be loyal customers. In a word, the strategy which gives away free sample on social media has limited value in a way that how many people who apply for sample can turn to frequent buyers is unknown.

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