A review of the growing influence over the last two years of how social media can affect marketing strategies has major implications for business and brands. Couple this with a growing consumer concern for the safety of their food and it is easy to conclude that we must have a social media component in our food safety communications crisis plan. Without a social media plan, some experts point to Chipolte Mexican Grill’s dramatic loss of market share as an example of how social media can adversely affect the bottom line.
Do you remember hearing about how one of the world’s biggest music stars ignored the traditional mass media product launching process in 2014? She bypassed the “normal” mass media release of a radio campaign, multiple TV appearances and retail and consumer brand promotions. Instead she announced it on Instagram to her 8 million followers with the word “Surprise” and proceeded to launch the 14 songs and accompanying 17 videos on iTunes. It was a success and it exceeded the album downloads of the previous album which had used the traditional marketing model! This trend continued to climb through 2016.
Businesses that are relentless in building a following on social media are in fact creating their own publishing platforms
Businesses that are relentless in building a following on social media are in fact creating their own publishing platforms, growing their marketing channels and content distribution networks. Social media is a blur of tweets, shares and content. No longer is it just used by youth. It is global and embedded in every aspect of the web.
So, what drove a music star to bypass the traditional marketing model in 2014? At that time: 72% of all internet users were active on social media; 18-29 year olds had an 89% usage; ages 30-49 bracket sat at 72%; 60 percent of 50 to 60 year olds were active on social media; 65 plus bracket were 43% active; time on Facebook per hour spent online by country: Americans spent 16 minutes, followed by Australians at 14 minutes and the British at 13 minutes. Seventy-one percent of users accessed social media from a mobile device.
Now, fast forward to 2017 and beyond. Digital ad spend in the US officially overtook TV ad spend in 2016, with research showing “the spend” on digital advertising at $72.09 billion, while TV spending was at $71.29 billion. Although a marginal difference, it marks a big change in advertising and marketing trends since 2014.
TV viewership continued to decline throughout 2016, and social media picked up the slack. TV ratings in the US were down 40% among teenagers and younger twenty-somethings. How people watched the recent US presidential debates reveals where viewers are moving. The second debate had 63 million TV viewers, while 124 million viewers tuned in on YouTube, 3.2 million tuned into Twitter’s livestream, and Facebook’s Live broadcast partnership with ABC News got over 7 million views.
…customers using social media can easily tell a company and everyone else about their experiences with that company
So, there’s no doubt that social media is becoming an integral part of life online as social websites and applications proliferate. Customer relationship marketing can be a powerful business tool because customers using social media can easily tell a company and everyone else about their experiences with that company — whether those experiences are good or bad! The business can also respond quickly to both positive and negative feedback and maintain, regain or rebuild customer confidence. However, if a company is not prepared to respond instantly when a crisis occurs, consumer confidence quickly drops and social media dialogue can adversely impact business results.
For example, taking a closer look at Chipotle, its leadership has struggled for 18 months to improve the restaurant chain’s food safety efforts and win back customers following six foodborne illness outbreaks in mid-2015. The impact of the outbreaks, which sickened more than 500 people in 40 states, continues to linger for the chain founded in July of 1993 by Steve Ells.
As of last November, Chipotle reported a 63 percent combined plunge in its 2016 earnings
As of last November, Chipotle reported a 63 percent combined plunge in its 2016 earnings over three quarters, reducing the stock to $368.02 per share at that time, or less than half of its pre-outbreak high! Comparable restaurant sales dropped 4.8 percent for the final quarter of 2016. In mid-January, it became clear that the outbreaks of foodborne illness are much harder for a chain to overcome in the social media era. To make matters worse, every time CMG announces lower same-store sales, it adds more anecdotal evidence to the case!
Preferring to concentrate on the fix, CEO Ells recently announced plans to install new air purifying equipment and ice machine sanitizers in its 2200 restaurants and all new locations. He also admitted that he spent too much time on teaching employees about the “esoteric aspects of an empowered people culture” instead of how to provide the best customer service.
Analysts say it has won back most of its most loyal customers, but still has problems with customers on both coasts who have other fast casual options. Besides investing in food safe solutions, it appears that educating the workforce and communicating to consumers that Chipolte cares about their health and well-being will define their future. It is an ongoing business case that merits close attention