Kodak, despite its financial struggles over the last couple of years (more here), has emerged as the golden child of social media. With 29 dedicated Facebook pages (overview on Kodak’s website), various dedicated Kodak owned blogs, twitter, flickr, google+ and youtube profiles (summary here), Kodak is actively engaging with consumers and prospects.
Kodak’s CMO, Jeff Hayzlett, has been very outspoken in the media about Kodak’s strong social media engagement, not just by publishing Kodak’s own social media tip booklet, but by detailing Kodak’s belief to grow its brand and thus, in theory, its market return.
How much is a Facebook like worth?
It can be hardly argued that Kodak’s social media efforts were of shortsighted nature and or didn’t reach consumers, yet sales fell short in almost every product category Kodak serves, multiple quarters in a row. One could of course argue about operational and or product inefficiencies at Kodak (e.g. the constant decline since Kodak’s $ 10 billion sales in 1981 through its struggle with the digital disruption in its markets), yet sales is what ultimately matters and this is were Kodak’s social media engagement seems to fall short.
Can you convert fans, likes, followers into buyers?
Most articles, blogs, books and papers argue to convert followers into sales by promoting follower specific sales incentives, apply like gates (e.g. you can only access certain content by liking a site) and various other methods. Unfortunately, Kodak has applied almost any of them. Kodak has been highly engaged with its followers, listened to conversations, offered specials, had consumer specific content areas and even filtered consumers into product niches to allow for highly relevant content. Based on this, one can continue to argue Kodak’s mediocre and lagging innovativeness in the digital image space is a major factor to let sales slip further downwards.
The Kodak Moment of Truth:
1) Social Media can hardly make up for a lack of product innovation. If you have 1000 fans but no product, you can impossible start to convert fans into sales. In other words, don’t over-promise but under-deliver (as it seems, traditional marketing lessons learnt do still hold true).
2) Listening to consumers is reactive, sometimes a company might need to be proactive (especially in new product development – taking lead times into account)
3) A like is worth nothing if you file for bankruptcy: this is probably the most important lesson to be learnt here! When a business is going fine, a like can be calculated in any way you want because you can actually afford to spend resources thinking about the value of a like. Most likely you will also have to spend resources to justify the resource expenditures in the first place, which is why you come up with this calculation in most cases. In a situation in which the very existence of a company is in jeopardy, all creative like value calculations come however down to one simple point: conversion. Can you or can you not convert your likes into sales.