During 2016, I gave a talk about The Collapse of Social Media Engagement. The premise of this talk and theory was about the current shifts in Social that would drive multiple changes in the fundamental pieces of how we perceive engagement and attention.
The video can be found here: https://tv.iihnordic.com/patrick-kitchell-microsoft-the
To Recap The Talk:
1. Think of social media engagement as money in an economy.
2. Imagine that this economy had checks in balances.
3. Everyone in this economy knew the value of engagement and could transparently understand:
- The size of the engagement economy minus engagement via automation
- How much engagement would cost them?
- Who was producing true engagement?
The reality is much different and no one knows the true value of engagement and I believe that in 2015 there was a engagement bubble that burst.
What is an engagement bubble?
Keeping with the economic metaphor we have had as real life financial examples like the DOT.com bubble where in 2001 Nasdaq collapsed whipping out all the gains on technology companies. We recently lived through the housing bubble in 2007-2008 and we having a student debt bubble that is still building. Here is the graph for the housing bubble:
Just like those real life economic bubbles we have had a social media engagement bubble where the amount of engagement was inflated due to various reason discussed below.
We can see in the Buffer article located here: https://blog.bufferapp.com/lost-traffic that they lost ½ of all their referral traffic in one year. The bubble began to lose its air and pop and the ramifications are still being felt long into 2017.
What Has Happened and What is Next?
First, I think that the standardization of search has caused diminishing returns. Everyone knows to optimize and everyone is optimizing. This standardization of search which use to act like a turbo engine is now more like muffler. This is because the standardization of content optimization, which your content is punished for not doing. Since everyone is optimizing and know to optimize basically has a diminished boosting effect than prior.
Also, think about a future where robots write and optimize content for us. That is all content is perfectly optimized all the time. It isn’t there yet but it is coming.
In 2014 Google admits 50% of its ads are never read by humans – google it
Second, content shock or as I call the apocalypse of content. The term coined by Mark Schaefer basically points to the fact that we creating so much content all the time that we can never consume all of it. Never. Even the amount of good content is also growing as fast as bad content. This means that the best content won’t bubble up anymore because there is so much of it. Bottom line is we create enough content that we will ever consume all of it.
This upward trend of content consumption is not sustainable because every human has a physiological, inviolable limit to the amount of content they can consume.
– Mark Schaefer
Third, the thinning out of engagement. Because our traditional social platforms have been around for so long we know how many likes, shares, retweets are created on average. This engagement is known and think about what happens when there is more content and the same amount of engagement? It’s just human nature that we don’t have more time to engage and the engagement gets spread out thinner and thinner over more and more content.
Fourth, automation adds engagement inflation. Automation on traditional and now non -traditional platforms like snapchat pump into the engagement economy inflation or fake engagement. Automation de-humanizes and also creates a false feeling of security about the amount and price of engagement in the economy, Thus the bubble.
Automation also disrupts our ability to make rational choices on understanding future consequences and future preferences of consumers because it clouds our ability to measure their intent.
Rational choice involves two guesses,
1.) a guess about uncertain future consequences and
2.) a guess about uncertain future preferences.
– James March
Fifth, in the moment marketing arises. The rise of video, snapchat, live streaming has added to the bubble bursting because these venues are time consuming. If attention and time are the constant, then these tools take more time leaving us less time for other channels, other actions.
I think it is important to state that live video is not that answer and not because it isn’t exciting rather it is time consuming. This means that if video(live or not) grows exponentially like all other content then we will see even less video and even less static content. It is a vicious circle; more content, same amount of time.
Sixth, The explosion of technology is a pain point. Just look at the rate of growth in marketing technology alone and add this with diminishing results on social makes it very difficult for organizations to understand which technologies will give them the greatest returns. The reality that it is more of a bet to invest in the best of breed technology is just as big as a gamble to organizations as keeping their current ecosystem.
What is Next?
I would say the correction of the engagement economy including these 6 challenges aren’t minor challenges. They play into the very foundation of social media and the models built around how social media has become a powerful channel. Because of all these challenges it should be obvious that the correction of this engagement economy will cause heavy disruption to social media, influencers and companies that rely on engagement economy. This correction will lead too many things but the two obvious ones being felt already:
Social Media Influencer Marketing
I see social media influencers marketing bearing a heavy brunt to the engagement economy economy correction. The reason is that the competition is ever increasing because of the rate of return around being an “expert” has been good enough and attractive enough that more people think they can do it do and therefore driving the price towards nothing.
Add to this that the skill set and professional framework to measure the level of expertise doesn’t exist there is an influx of “wolf in sheep’s clothing” that talk up their ability without having the record to back it up and in the past this step may not have been necessary because the demand for them was higher.
Because of competition and variety of skills sets, people are willing to work free to gain a foothold and name in the business. This cheapening of labor and of the expected skill set is ruining the future potential for all social media marketing experts and creating distrust at companies purchasing these services.
One reason is the promises can’t be met for the same return as 3-5 years ago because of all the structural issues mentioned and another reason seasoned marketers leave the market after growing tired of cleaning up after the ones ruining it for them.
Increases in Cost
Like all good collapses the customers carry the cost and risk through increases in the prices for services. This is happening in this scenario. Therefore, the cost for search optimization will continue to increase because people believe this is the best route to returns on their content.
The cost of creating good content will also increase because search and good content are like the ying and yang. Finally, the access to social networks will increase because in due time these will be best or only places to launch content. Pay to play and pay to lose.
Everywhere and Nowhere
Finally, companies will need to decide two things based on the correction of the economy, the saturation of labor and increasing of costs. The first is where to place their content? Content might be better off living on newly created communities that companies drive themselves that pull engagement from other platforms to themselves.
The limitations of pay to play and the increase of pay to play make building your own communities off traditional platforms a real cost opportunity in the long run. Second, new tools to measure expertise of marketers claiming to have expertise in social media. Reach means nothing this is the take away from the inflation driven engagement economy as reach can be automated. Add to this that reach may be a good indicator WHO not to hiire.
Those that claim to know something but can’t back it up with a powerful community on various platforms maybe a good indication that they hacked their reach through buying or automated engagement. We all know these types.
Love to hear your thoughts and ideas around the future?