Last Monday, I went to McKinsey & Co’s annual New York Office alumni holiday party. Each year, the party features a content presentation linked to a major business issue. One year the presentation was on China. Another year it was on the on the global recession. This year it was on “Unlocking the Power of Social Media for Superior Performance.”
For those of us in PR and marketing, the power of social media is an every-day subject of conversation. But, among strategy consultants, the positioning of social media as “transformational” raised a few eyebrows.
As many of you know, McKinsey joined forces with Nielsen earlier this year to form a new group – NM Incite – which advises CEOs, CMOS and COOs on digital media strategy and tracking. The Firm launched NM Incite because, in the words of McKinsey Director, Dan Singer: “Social media is here to stay, and it’s transforming the marketing, customer service, HR and communications functions.”
Because social media cuts across the organization, it has huge business and operating implications. According to Singer, social media is doing more to break down silos between sales, marketing, service, R&D and HR than anything else we’ve seen to date
While Singer and his colleagues believe that Twitter and Foursquare may be fads, they stressed that social media, as a category, is “transformational.” It impacts the entire business system – governance, talent sourcing, talent retention, new product development, marketing, sales, customer service, stakeholder relations. It’s fundamentally changing the way employees, customers and key opinion leaders exchange information – and also the way that customers buy.
According to a recent McKinsey study of CEOs, CMOs and COOs, the biggest hurdle to C-suite adoption of social media isn’t fear, inertia or regulation. It’s measurement. In fact, the two barriers cited most frequently by C-level executives were “can’t quantify impact” and “no measures.” All other obstacles trailed far behind.
To deliver on the transformational power of social media, then, the PR/marketing professions must crack the measurement problem.
What’s your preferred approach for measuring social media impact?