Comments on: Dell’s big Twitter returns: let’s not break out the champagne just yet.

By: Direct2Dell

Direct2Dell — Mon, 06 Jul 2009 07:33:04 +0000

My Thoughts on Dell & Twitter and Where This is Going…

It's been a few weeks since @StefanieatDell blogged about @DellOutlet reaching $2 million in sales…

By: Bas Berkenbosch

Bas Berkenbosch — Thu, 02 Jul 2009 19:04:55 +0000

@Tim
Agree that balancing long and shprt term is the game to play. So in order to gauge your investments you need to put a number on them such as NPV, LTV, ROI. In marketing this is about acquiring and retaining profitable customers.
I am really in it for SM to become a huge hit for all of us. But one has to be cautious. Remember the older days of the internet when AOL was more worth on Wall Street then Tme Warner because they had so many relationships. Then the bubble bursted because all these companies with these relationships never delivered.
BTW I would very much like you to show me the case studies that show how SM Marketing works better over the longer term.

By: Tim Walker

Tim Walker — Thu, 02 Jul 2009 14:23:43 +0000

Bas — I think Alyssa and Sheila would agree with you that “Every asset of a company is an investment that has to deliver.” I certainly do.

But possibly the greatest single challenge of all business management is balancing the long term against the short term. Social media marketing, from the case studies we’ve seen so far, tends to work better over the longer term. Or, to put it another way, it works better in the vein of building longer-term relationships and brand loyalty than it does in moving mass quantities of product in the short term.

So these relationships and interactions DO have value by themselves, because they’re not somehow separate from the process of selling more goods. It’s just that they’re cultivating more and better sales over a longer term, rather than pushing for the sale right-now-this-instant.

By: Bas Berkenbosch

Bas Berkenbosch — Wed, 01 Jul 2009 23:00:55 +0000

To Alyssa and Sheila Scarborough
I’m sorry , but I don’t get your point. Relationships and interactions have no value by themselves. How will they have a greater impact on sales in the long run? Greater then what? How far on the horizon? To me relationships and interactions are just means to an end and that is making a profit out of your business. Every asset of a company is an investment that has to deliver.

By: Bas Berkenbosch

Bas Berkenbosch — Wed, 01 Jul 2009 22:47:30 +0000

Spot on! If you can’t measure it, you can’t manage it. As long as everybody only talks about sales without deducting the cost of the products and specific marketing costs we’re still running in a circle.
As long as a marketing campaign can’t deliver above (let’s say) a threshold of 20% ROI it’s a no-go. And I really wonder.
The point is; would the money put in Twitter deliver more return from any other marketing campaign?

By: Friday quick hits 1: “thousands not millions.” -- Hoover’s Business Insight Zone

Fri, 26 Jun 2009 16:22:46 +0000

[...] focuses on the example of Dell’s @delloutlet account on Twitter, which I discussed at length last week. He’s particularly acute in discussing (1) the low cost of time and effort to make [...]

By: Tim Walker

Tim Walker — Tue, 16 Jun 2009 19:41:22 +0000

Thanks for all the great comments, folks.

One of the things I’m reacting to is the audience reaction to the $3M number. Dell itself has said smart things — like what I quoted from Binhammer in this post. They get that it’s a layered relationship. And, given the financial discipline in their corporate culture, I’m *sure* they think about things like cannibalization of channels.

But plenty of people who read news like Dell’s seem to think “Three million! Awesome!” — without pausing to consider the real-life business ramifications of that.

By: Sheila Scarborough

Sheila Scarborough — Tue, 16 Jun 2009 19:08:57 +0000

*** “I think Dell will find that their relationships and interactions will ultimately prove more valuable than their sales. How this will be measured as “success” is unknown, but I think it will have a greater impact on Dell’s sales in the long run.” ***

Someone give commenter Alyssa a massive consulting fee; she is precisely correct. :)

Nice post, Tim. I bought a Dell laptop for my teen in large part because I wanted to support a local Round Rock TX comany, and because I wanted to support Richard Binhammer and Lionel Menchaca and their outreach efforts for Dell.

By: Alyssa

Alyssa — Tue, 16 Jun 2009 18:13:17 +0000

Tim, great post! I’ve been wondering when someone will note that Dell’s income from Twitter may not have resulted from new business, but from customers who would have bought elsewhere. It would be interesting to see if any specific area of Dell’s other sites had seen a similar decrease in sales.

I think Dell will find that their relationships and interactions will ultimately prove more valuable than their sales. How this will be measured as “success” is unknown, but I think it will have a greater impact on Dell’s sales in the long run.

-Alyssa

By: Russ Somers

Russ Somers — Tue, 16 Jun 2009 18:00:00 +0000

Great post. Reason #2 is especially compelling (and proving incrementality is really hard). It’s also worth noting that any revenue that’s shifted from one channel to another can ignite conflict between channels. I’ve seen channels of the same F500 company engage in price wars with each other – a true circular firing squad.

That said, there are plenty of reasons to congratulate Dell on their achievements here. First and foremost is the simple fact that they’re meeting customers on their terms, serving them through whatever channels (web, phone, social media, retail, reseller) the customers prefer. That’s a huge shift for a company that started as a one-channel direct shop.