Get With The Social Media Program

Firms that prohibit use of social media are fighting a losing battle, and should instead focus on how to use it compliantly, said attendees at a social media conference in Boston.

At the recent LIMRA and LOMA conference on social media, held in Boston, attendees heard about how to take advantage of social networks and to use the tools compliantly. Still, challenges and confusion exist that are holding back the financial services industry at a time when the tools are becoming even more popular.

Christine Campbell, director of marketing at Socialware, new proprietary research showing that adoption of social networks for business purposes is gaining momentum. She stated that more than 75% of respondents are using LinkedIn (up from 59% last year), more than 50% are using Facebook (up from 50% in 2010), and about 35% are using Twitter (which about doubled in a year’s time.)

The conference covered social media from many angles. Here are five confusing points within the industry that surfaced:

1. Constant compliance changes
James Douglas, senior account executive at Smarsh, shared that their recent survey of broker-dealers and registered investment advisors showed the number one concern of respondents is “new and changing regulations.”

2. New social networks
Douglas highlighted “new communications channels” as the second highest concern. Google+ is a perfect example of a new social network that was released this July that is confusing things even more. Plus, it is putting pressure on the other networks to match new well-received features.

Social networks are no longer limited to the big three. “Social media functionality is becoming a part of traditional Web sites, and we see this occurring in small communities with local traditional referral networks like the chamber of commerce,” said Jessica Shull, in social media marketing at State Farm. “How do you monitor social activities on all of the small sites all across the country?”

3. Disclosure placement
Stephen Selby, director of regulatory services at LIMRA, said, “There are many different regulator and they haven’t figured out all the answers. For example, what disclosure goes where?” He was referencing how marketing used to be pushed out in one complete form, but now interactivity has changed how communications take place.

4. Static-interactive combinations
Selby explained how FINRA has been clear about the difference between static and interactive communications, but there are hybrids that create confusion. “You don’t have to re-file if the (static) material is the same or substantially the same,” Selby said. “However, if someone throws out a conversation changer, is it still the same? One conversation thread can materially change the nature of the conversation.” He gave an example of how a Facebook wall might be approved for annuities, but what if the conversation changes to options? Plus, there are numerous less obvious examples.

5. Facebook outside of Facebook.com
Selby talked about another area of confusion, saying, “Facebook Connect is a single sign on for the internet. There have to be more than 500,000 sites using it now.” He was describing a tool that allows comments to be made on other websites by logging in through Facebook. He challenged the crowd, “Is that part of your social media policy?”

Selby admitted there is no way to train on every new social media network. Thus, in some cases training should take place based on functions. He then asked, “Or do you train on risks?” The crowd rattled off a laundry list of risks: legal, ethics, business, reputation, productivity, privacy, and data security, so even that approach is even confusing.

One Thing Is Clear
Banning social media outright is no longer an option, which was unanimously agreed upon in a show of hands in Selby’s session. Douglas agreed in a separate presentation, saying, “Social media prohibition is not working.”

Selby explained the typical progression from prohibition. It starts with executive commitment, then leading to evaluation, policy, procedures, training, activation and finally optimization.

He said, “Although (social media regulation) is still relatively unsettled, we do know that all the old rules still apply: Don’t lie, don’t cheat, and don’t steal.” A simple way of looking at an ever confusing compliance environment.

Mike Byrnes founded Byrnes Consulting to provide consulting services to help advisors become even more successful. His expertise is in business planning, marketing strategy, business development, client service and management effectiveness, along with several other areas. Read more at www.byrnesconsulting.com or by typing in his last name in the search field on www.fa-mag.com.

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Outback Steakhouse Free Steak Dinner Deal a Restaurant Marketing Win

Outback Steakhouse has made a move that will dominate restaurant marketing news this week, and possibly far into the future. Their most recent promotional campaign has cost the company quite a bit, but the results may catapult the chain ahead of their competition in both the steakhouse genre and the entire casual dining segment of the restaurant industry.  The campaign making all the buzz is known as “The Great Aussie Steak Out”. The chain gave away one million free steak dinners, and all you had to do to snag one was to hand over your email address, phone number and a few personal details.

The release of information about the promotion was carefully controlled to build maximum interest and excitement. The first teaser went out in the form of a tweet on Monday. It simply hinted at the release of a big secret in the near future. Tuesday saw hints and teasers posted on the company’s Facebook page, including a video that gave everyone the first idea about when the secret might be revealed. The video featured a giant steer and the date of August 24^th. The chain also invited excited fans to text a specific number so they could receive an update exactly when the secret was revealed.

Finally, on Wednesday, August 24^th, Outback published a press release outlining their plans for that evening. At 9:01 pm, on national and local television stations across the country, a commercial aired explaining that “The Great Aussie Steak Out” had begun, and that guests could pick up their coupon for a free six ounce steak dinner at www.thegreataussiesteakout.com. The traffic was so great within the first few minutes after the commercial aired that the website went down temporarily. When it returned, fans resumed their frenzied attempts to sign up for the promotion.

The certificates are redeemable at 777 restaurants that are participating in the promotion. Guests could only receive one coupon, and they had to have an address that was within 25 miles of a participating location. The giveaway will end at midnight on Friday, August 26^th, or when all of the one million dinners have been claimed, and limited the promotion to one entry per. Guests will receive a six ounce Outback Special Sirloin Steak and their choice of one side when using the discount. It’s only redeemable during normal hours between Monday and Friday.

This may sound like a great way to bring in unprecedented amounts of traffic, but what about the costs? The most obvious cost comes in the form of revenue lost on one million steak dinners. Giving away a steak, even a six ounce sirloin, comes at a steep price as meat costs continue to rise. Many steakhouses and other restaurants are struggling to break even with paying customers covering the costs of meat. Each guest has an opportunity to eat their dinner without ordering any other items, which means each restaurant loses money on labor to serve them, cook the food and wash the dishes. Each diner with a coupon for a free dinner takes up a seat that a paying diner could fill. The web hosting, commercial production and logistics of giving away one million coupons didn’t come cheap either.

On the surface it may seem that Outback Steakhouse is losing more than it could possibly gain. However, consider the value of up to one million email addresses, physical mailing addresses or cell phone numbers. A list of a million interested potential customers who now have a favorable view of the brand because they received a free dinner. Companies pay high fees for contact information on customers who may not even be interested in their brand or what they’re selling. In one large move Outback has efficiently built a massive marketing list. Now the chain knows who to email or text when they want to fill restaurant seats again with another enticing promotion. Each visitor, paid or free, is also an opportunity for positive reviews on social networks like Facebook or review websites like Yelp.

Marketing lists directly translate into income for a company if the marketing and promotional team know how to use them. If Outback wants to recoup what they’ve spent on “The Great Aussie Steak Out”, they’ll need to find a way to turn at least a small percentage of the free diners into paying diners. Drinks, including soft drinks, aren’t included with the meal. This means most people redeeming their coupons will at least add a drink to their order. The portion is small, so an additional side dish or dessert is more likely as well. The real profits will only come if diners return again without a coupon. While other socially driven deal websites like Groupon report great success at encouraging second full-price trips, other restaurant owners and industry analysts often disagree that this is common. Many restaurants avoid giving deep discounts or free meals away as promotion because they feel that deal-seekers won’t return to spend money later.

The main reason for the giveaway was to highlight and introduce the new wood-fired grills being added to Outback Steakhouse locations. The wood burning appliances give steaks a smoky flavor and special surface sear that gas and electric grills can’t match. All of the steaks given away as part of the promotion will have the option for being cooked on the new grills. Outback’s kitchens will retain their other signature grills, and guests will have the option of which cooking method they prefer.

“The introduction of our new wood-fire grill, in addition to our classic seasoned and seared cooking method provides our customers with more choice in how they’d like their steaks prepared,” said Jeff Smith, Outback Steakhouse president.  “Additionally the wood-fire grill gives us a big platform to innovate new and exciting products.”

The promotion was also to highlight new menu additions. These other options include the Aussie Chicken Cobb Salad, the Mediterranean Chicken Flatbread Aussie-Tizer and the Hearts of Gold Mahi.

 

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