Sunday, November 4, 2012

Finding a Haystack's Most Influential Needles

In her article “Finding a Haystack’s Most Influential Needles,” Olga Kharif brings to light start-up companies who are challenging current heavy-hitters in the area of social media analytics; these newcomers are using unique methods to identify social media influencers who are likely to affect their clients’ sales.  One such newcomer is Tellagence. Tellagence focuses on the qualitative value of relationships, while its much larger and well-established rival Klout focuses instead on the quantitative.  Klout puts great value on “popularity,” focusing on data like the number of friends an influencer has.  While Klout can meet business needs of companies who wish to broadcast their message far and wide with no particular focus, it does not allow for targeted influence as Tellagence does.  Klout points its clients toward influencers who reach only one big circle of people, while Tellagence is creating big upward movement in sales for its clients by pointing them instead toward “a network of relationships that care, and [that] will move content forward exponentially” (Jones).
This article illustrates the fact that businesses can no longer afford to ignore the priceless data piling up about their customers, and a huge wealth of information lies in social media cites such as Facebook and Twitter. With the recognition that resources need to be diverted toward puzzling out this data, who should companies turn to? The methods companies like Klout employ are limited by the fact that influence (in their eyes) rests on popularity and vast amounts of social media activity.  Klout scores are the same for an individual regardless of which client is asking.  Tellagence offers something new to the market, a narrowly focused approach to data that could result in much higher sales for clients.  I believe much more in Tellagence’s approach, as it is more tailored and fitted to individual client’s needs.
Businesses must keep in mind, though, that social media analytics is only one piece of big data that must be focused on.  Becoming wrapped up in this one facet of big data could easily be detrimental to a company, regardless of whether they use Klout, Tellagence, or some other group.  The easiest way to explain this is through Ron Conway.  Ron Conway, a hugely respected angel investor, has a Klout score of 48 out of 100.  To say that the man is not influential online or in the business world is absurd, but Klout and other social media analytics break down when the influence of a person is not recognizable through such sites as Twitter and Facebook.  Ron Conway is a busy man and tweets two or three times a month at most and can’t be posting on his Facebook page at every hour of the day; therefore his influence (though vast) cannot be recognized by social media analytics.  Big data crunchers like Tellagence and Klout are an intriguing and important resource for companies who wish to beat out their competition, but these companies must keep in mind the limitations of the specific tool they choose to boost sales as well as the overall limitations of social media analytics.

Bloomberg Businessweek October 22-October 28, 2012 pg. 46-7

1 comment:

  1. Erica, your article raises an interesting topic that is relevant to the future of business strategies. Many companies rely on advertisements to get their message out to the general public. To do so, they use popular celebrities, dominant athletes, and anyone else who influences and appeals to a large audience. In today’s world, social media allows anyone to stay connected through Twitter, Facebook, Instagram, or other social media sites with any celebrity.
    According to Erica’s critique and the article, Klout and Tellagence are the top dogs in the big data world searching for the best way to reach their desired audience. Klout and Tellagence focus on different demographics. Klout analyzes a person influence based on their popularity (Twitter followers or Facebook likes). Tellagence approaches the big data world to advertise a precise message to a specific desired audience. Both companies aim their strategies to produce more sales and raise profits after reaching out to new markets and costumers through their strategies.
    Both companies have flawed approaches in my opinion. From one aspect, Klout is doing it right by trying to reach the largest demographic by advertising through the masses. However, Klout has no idea what percentage of response they will receive. Will Klout see an increase in their profitability? Tellagence aims to reach a desired demographic of costumers. The concept probably is effective, but it sells them short. If they sent the same advertising to new customers, could they retain new costumers?
    In my opinion, Klout and Tellagence should combine companies or strategies, and if not, someone should simply meet in the middle. I believe that the most effective way to reach the most people is to identify their goal, create a simple and informative advertising campaign, and send it out to the masses. The idea incorporates Klout’s send it out to everyone strategy and Tellagence’s focus on specifics.
    It is true that social media is creating more data to the Big Data and a new era for advertising and communication. Companies need to realize the importance to adapt and incorporate business strategies revolving social media. The article was informative and the critique was a pleasure to read. Well done, Erica.