The other day I came across a blog called The Ad Contrarian, and read a post named Social Media’s Massive Failure, which describes Pepsi Co’s social media efforts, and how it was a huge failure.
The background: Last year, Pepsi substantially abandoned “traditional advertising” in favor of social media. They canceled its annual Super Bowl advertising, and instead diverted tens of millions of dollars to create the “Pepsi Refresh Project” (instead of spending the money on traditional advertising). Pepsi Refresh was an online social media initiative in which Pepsi gave out $20 million.
So what happened? Well, last week, the Wall Street Journal reported that Pepsi-Cola and Diet Pepsi had each lost about 5% of their market share in the past year. Also, for the first time ever Pepsi-Cola has dropped from its position as the number two soft drink in America to number three (Diet Coke is now number 2). These are pretty horrific statistics, however, the Pepsi Refresh Project also registered over 80 million votes, almost 3.5 million ‘Likes’ on Facebook, and gathered almost 60,000 Twitter followers.
The author of the blog article concludes by saying “Social media has taken a huge hit. Only zealots and fools will continue to bow down to the gods of social media.”
I am perfectly fine with saying that I think the author is wrong by saying that “Social Media is a failure” and “only fools will use social media.” I believe social media is huge for any company. It provides them with the opportunity to engage with their consumers, and hear (and respond to) consumers’ thoughts about a brand in a way that hasn’t been possible before. What happened with Pepsi was that they gave up completely on traditional advertising and therefore did not have any channels that encouraged buying their product. The utilized social media in a perfect way – they got the engagement etc., but lacked in the selling of their product, which is easiest done through traditional “interruption advertising.”
I don’t believe for a second that social media is a failure. Social media provides us with the opportunity to engage and connect with our consumers like never before, and it also helps smaller businesses with non-existent marketing budgets to get the word out. However, even though I think huge corporations need to have a presence on social media, they also need to continue with their “Here we are, and this is why should buy our product”- approach. I simply think the author is a little quick on judging social media as a failure. Yes, he might be right, social media will not necessarily increase your sales, but it will definitely strengthen customer loyalty if done right, among other things.
Those of us who “will continue to bow down to the gods of social media” are certainly no fools. I would argue that people, who try to ignore social media, and argue that it is a huge failure, are the ones that are the fools.