Social Media: Product or Service/ Technology or Human – A take on convergence in the Social Media space (EmPower’s Bytes and Brains Philosophy)

The world around us is converging – and this convergence is being seen across industries, and across “spheres” — it could be the functionality earlier offered by multiple electronics devices now being offered by one (the home theatre being all entertainment/ the camera being memories plus media/ the phone ofcourse being the ultimate catchall converged device; LG’s microwave coming with a TV screen); it could be retail formats that are no longer differentiated by “discount” vs “departmental stores” what with a Target offering “fashion forward” apparel and Macy’s having discount and clearance aisles (or Malls being the One Stop Shop experience) ; or it could be schools offering “all round and all day” advisory services and offices catering to work/ food/ exercise/ entertainment and family life needs.

This convergence in another form is seen when companies on opposite ends of the value chain (read Product vs. Services) are attempting to cross-over to the other side in a hope to maximize revenue potential. So you have Pizza plus delivery; burger combos; Paint companies with Home Makeover solutions; “mass customization” by Nike; and drug, device and advisory services bundling by Pharma Companies.

In the IT/ ITES space, you see it in product companies making products themselves palatable by offering SaaS (one of the first was Siteeasy; Salesforce probably is the best known one) , and then offering Professional Services layers around themselves to really reorient themselves to “Solutions” and not products (IBM’s move from computer products to technology services) .

Similarly, services companies are in eternal quest of “productization” or “assetization” of their offerings inorder to scale in a non linear fashion and also increase productivity and profitability. Some interesting examples of consulting companies moving almost completely to product versions are 37signals (started as a website development consultancy and now has many well known products – basecamp being my personal favorite); Raven SEO etc. This despite  services accounting for upwards of 80% of the US GDP; and upwards of 40% of GDP for even a country like China.

Having said that, the interesting dynamic really is that of the role interplay between products and services – both for product companies and for services ones. For product companies, it is about whether services are enhancing the product or expanding the offering.  For services, its about scale vs customization (or skill). Ofcourse, these dynamics offer their own challenges in this convergence  move.

https://www.mckinseyquarterly.com/The_right_service_strategies_for_
product_companies_1727

Interestingly enough, this debate takes on yet another form when we come to Social Media Service Providers – with most providers historically coming from anywhere in the spectrum from a pure tools approach to a pure people approach, and now both ends moving towards the other such that the words oftenest heard are “software aid human analysis vs. human aided software analysis”.  This slugfest is happening here and now, and is definitely headed towards a shakedown. Till then though, it makes for a very interesting battle, with service providers providing various forms of “listening” and “learning” – from a pure SM data crawl service – which is more just for a quick look everyday at “what is happening” to, at the other end, use of the data merely as a means to an end, wherein advanced MR techniques are applied to the data for research applications.

EmPower Research has traditionally approached this landscape from a pure services angle, having been a provider of “Business Research Services” to enterprises. Somewhere along the company’s life cycle, Social Media as a data form started emerging and we were very quick to recognize the power of this data not only from a  “listening” (read usage by corp comms people and PR agencies) but also from an “insights” (read MR/ Consumer Insights people) perspective. This was essentially the power of the customer voice – raw/ uninitiated/ proactive and therefore so much more powerful than that which is captured as a result of questions asked (where what u ask and how you ask it, will dictate what answers you get). This enabled development of very strong methodologies and constructs that enabled the mining of insights from this rich source of data. Constructs like the STRANDS/ 2p/ CERT etc were all based on the ability to apply classical MR tactics to this new emerging data source. It proved challenging, purist researchers were not quite sure this was real and credible, but early adopters did see the usage in diverse scenarios.

Some of these usages were:

• Getting a contextual understanding of a category landscape – a bit like exploratory research;
• Getting at difficult to ask questions/ scenarios that did not respond well to prompted question like taboo subjects
• Generating hypotheses to arm primary research better
• Validating the metrics/ numbers etc that primary research was throwing up e.g., in brand equity trackers

It was real, it was topical, it was gettable at and wonderfully exciting

Having said this, the sheer volume of the data posed challenges – and that’s where most service providers are using technology. Technology that is crawling the www, harnessing all the terabytes of social media opinions/ conversations/ scraps/ posts whatever;  introducing NLP and versions on top to make contextual sense of it.

This is also where the convergence is making its play – the technology guys, more “product” plays realize the limitations of technology and want to/ try to wrap a professional services layer on top of their offering; and the services folks, knowing the end applications well, cannot however depend on a  pure services play and so need to inject some version of “productization” – either via making/ buying/ licensing pieces of technology to be the back/ or front end of their services; OR by modularizing the services aspects themselves (not to talk about the shortening in sales cycle this implies). As someone said “Productizing is part incentive, part packaging, and mostly communicating a set of expectations about the process and outcome.”

Zach Hofer-Shall of Forrester Research has a nice take on this in his latest white paper – The 2011 Listening Platform.  He has segmented the market into the Social Dashboards aka the pure products players/ the Multichannel analytics Providers and the Listening Service Partners aka the services players. The latest development here btw, which transcends the definitions even of what is social media vs. not; has been the Radian 6 takeover by Salesforce.com; a true convergence across boundaries of software as services players…

The question really for most of the service providers, and the enterprises looking to play in this field, is which end of the spectrum to back – as technology becomes more and more sophisticated and therefore may be able to do more and more customization/ insights and application orientation, will the product OR the services guys get outmoded? The answer is a resounding NO. in the short to medium term, there is so much that the human layer of insights which after all the classical MR purists spent centuries perfecting can lend to this rich new data source, that the best solution for the enterprises really is that provided by the Listening Service Partners — ie, take the technology as a means to an end, but add on top the value of the human brain and understanding of the languages to really deliver true insights to the customer.

Add to this the fact that services are less visible/ more difficult to copy and thus more differentiatable. What however makes this a bit complicated is that the “product” buyer is typically the CTO’s organization while the services buyer is the CMO’s! The other similar question is – do you confuse your client by attempting to be “ all things to all people” NO, given the technology has its part to play in being the means to an end while the services part is really focus on application/ end usage and therefore the two can peacefully coexist even under the same banner. Does this imply a query based yet self service enterprise platform hybrid model of usage? Maybe! What pricing models will therefore work? Subscription per seat/ per amount of data/ per project? The jury is still out, but in the true spirit of convergence, definitely looks as if the two sides of the spectrum will meet somewhere in the middle. As Jenkins states that convergence is, “the flow of content across multiple media platforms, the cooperation between multiple media industries, and the migratory behaviour of media audiences.”

By Sangita Joshi