Today in Digital Marketing - The Argument for Ignoring Consumer Complaints

Starting point is 00:00:00 Today, how do chatbots affect your brand's stock price? LinkedIn plans to drop polls from its feed. TikTok's new tab might decrease your reach. Cameo lays off 25% of its staff. And the argument for ignoring complaints on Twitter. It's Friday, May 6th. I'm Todd Mathen. Here's what you missed today in digital marketing.

Starting point is 00:00:23 We consumers are fickle. We expect the products to be perfect and customer service to be fast and precise. Problem is, people are sometimes neither of those two. So little surprise that many brands have turned to chatbots to supplement, or in some cases, completely replace their human customer service team. Take Aflac, which famously has a duck as a mascot. A couple of years ago, it introduced DuckChat, an AI bot on Facebook Messenger that would help enroll customers.

Starting point is 00:00:52 Or Bank of America that made a chatbot named Erica and set her to work in its mobile app, helping customers with basic banking tasks. There's Levi's, virtual stylist, a bot inside Facebook Messenger. Hell, there's even LubeChat, which,ist, a bot inside Facebook Messenger. Hell, there's even LubeChat, which, no, not what you're thinking. This is actually a B2B chatbot from Shell, which helps share product information for customers of its industrial lubricants. And while a lot of research has gone into how consumers react to chatbot conversations,

Starting point is 00:01:26 there hasn't been a lot of study into how the bots make people feel about the company itself. People like investors in the company. That's what Dorema Fotheringham set out to discover. She is co-author of a research study called The Effect of Implementing Chatbot Customer Service on Stock Returns, which was published recently in the Journal of the Academy of Marketing Science. More importantly, though, Dorema also defended her PhD dissertation just a couple of weeks ago. So I'm pleased to say welcome, Dr. Fotheringham. Thank you, Todd. So you measured how investors reacted when a company announced that they'd start using chatbots. What did you find?

Starting point is 00:02:00 So we saw a positive bump in stock option price on the day of the event announcement. Investors did see the value that the chatbots could provide to customers and responded with their purchasing power. Was there any difference between B2C brands and B2B brands? Yeah, I'm glad you asked, because that was one of the questions that me and my co-author also looked into. And what we found was that this positive bump was especially significant for B2B companies. And as we know, B2B companies are often lagging behind in digital customer experience compared to B2C companies. So these chatbots did provide a really good bump for B2B companies, showing that investors saw the opportunity of increasing customer experience for B2B customers. And we saw that reflected positively in the stock price of these companies.

Starting point is 00:03:04 But there was an exception, though, in your research. Was there not when those chatbots in B2B brands became more human-like, they were anthropomorphized, to use sort of a more clinical term, that the more human a bot was, the less investors liked its use in B2B brands specifically? Did that surprise you? Well, if you think about the differences between B2B and B2C customers, B2B customers are busy people and they really prioritize functionality, effectiveness, efficiencies over all these bells and whistles of adding these anthropomorphic features, adding names and sprinkling some personality features.

Starting point is 00:03:45 I know some companies were even hiring comics to write jokes for their chatbots. But for B2B customers, all they're interested in is the efficiencies. Did you study the market reaction to how chatbots were rolled out? I'm thinking like companies that just started the bots up on day one versus those that may have started with a small beta pool of customers. Yes. And what we found was that a soft launch, a beta launch with a segment of customers was much more positively received by investors. So investors really valued a more measured approach to implementing such novel technology.

Starting point is 00:04:28 Well, it's certainly interesting research. I'm delighted you could share it with us. Thank you for your time. You're welcome. It was a pleasure talking to you. Dorema Fotheringham is an assistant professor at Texas Tech University. She joined me from her office in Phoenix, Arizona. So you want to engage with your LinkedIn audience? Do not post a poll. LinkedIn members have apparently had enough. The professional network announcing today it is changing its feed algorithm to provide users with a more personalized and content-relevant experience.

Starting point is 00:04:58 To start, the algorithm update will reduce the reach of engagement baiting posts, which it refers to as low quality content. As a result, any content that asks or encourages users to engage with content like likes or reactions will be downgraded. LinkedIn says this content could be misleading and frustrating and that instead it will be focusing on promoting reliable, credible and authentic content. This also includes downgrading polls. LinkedIn says it's, quote, heard feedback that there are too many polls in the feed, unquote, and as a result, it will only be showing polls that are helpful and relevant. Next, the algorithm will show more targeted activity from your own network. And finally, the update is striking down political content by giving its users the option

Starting point is 00:05:40 to opt out of that content. The platform is testing a feature where the posts will have an I don't want to see this option. In an update that is almost as annoying as when Instagram replaced its notifications tab with the shopping tab, TikTok is replacing its discover tab with a new friends tab. Friends, by the way, in TikTok's world is when you follow someone and they follow you as well. The company has confirmed that the test is being expanded to more users. I got it yesterday.

Starting point is 00:06:12 Apart from having to adjust to a new interface, though, how will this change affect brands? It could mean that if users stay specifically to that tab, they will see less of your brand's content. Also, that content will be harder to discover since they are removing the Discover tab. In addition to users finding your brand account, that tab was actually pretty helpful to learn what was trending on the app. Cameo, the platform that allows fans to buy personalized videos from celebrity, has laid

Starting point is 00:06:43 off roughly one quarter of its staff. This comes about 24 hours after Snapchat announced a Snap and Cameo advertiser program at its New Front presentation. The platform CEO confirmed the layoffs in a tweet. Quote, Today has been a brutal day at the office. I made the painful decision to let go 87 beloved members of the Cameo Famio. If you're looking to hire hungry,

Starting point is 00:07:10 humble, smart, kind, curious learning machines who love to win and you see Cameo on their resume, look no further, unquote. TechCrunch reports the layoffs affected all teams within the company, including the senior VP of marketing, the chief product officer, and the chief technology officer. Quoting the CEO again, to support both fan and talent demand during the pandemic lockdowns, Cameo's headcount exploded from just over 100 to nearly 400. We hired a lot of people quickly and market conditions have rapidly changed since then.

Starting point is 00:07:36 Accordingly, we have right-sized the business to reflect the new realities. Do you have business insurance? If not, how would you pay to recover from a cyber attack, fire damage, theft, or a lawsuit? No business or profession is risk-free. Without insurance, your assets are at risk from major financial losses, data breaches, and natural disasters. Get customized coverage today starting at $19 per month at zensurance.com. Be protected. Be Zen. But here's a potential ad buy you probably don't have in your marketing budget. Gas pumps. During its New Front's presentation, retail digital display company

Starting point is 00:08:17 GSTV claimed a reach of 105 million people across the U.S., almost entirely through advertisements at gas stations. This according to Adweek. That's four out of 10 adults in the country, and the average consumer pumps three times a month. The company says this equates to each customer spending 15 minutes every month viewing its displays. If you're worried about your brand safety and your ad showing up alongside unsettling gas prices.

Starting point is 00:08:49 A recent partnership with insights company Affinity found that it is 50% more effective than digital video for campaigns like consumer packaged goods. A partnership with Live Nation Entertainment was also displayed at Shell gas stations with a spotlight of a music artist. According to the artist, within two months, Spotify listenership nearly tripled. Social media have brought brands some great things, increased awareness, sales, and a direct communication channel with their customers. But that latter benefit is sometimes a curse. Because when things go wrong, customers are happy to use that channel to complain, sometimes fiercely. The going wisdom, of course, has been for brands under fire to respond, to reply to comments in reviews, thanking the customer for feedback, explaining policy rationale, or sometimes apologizing. But is that the right approach? Are we then publicizing a problem that other customers might not have even known about?

Starting point is 00:09:40 That's what Ali Golmul Hadi set out to study. He is an assistant professor of marketing at the University of North Carolina at Charlotte. He and his colleagues recently published a study called Complaint Publicization in Social Media. I spoke with him earlier this week, and he mentioned that he decided to study this after seeing someone complain on Twitter about a brand that sold picture-hanging adhesive tabs. When the brand responded to that complaint, the complaint, along with the firm's response, appeared or basically moved to the Twitter page of the brand. And it was co-located with a tweet that promoted basically product on that specific aspect. On Twitter,

Starting point is 00:10:23 when you post a tweet, let's say you complain about a brand, only your followers would be exposed to that complaint tweet, which I don't know, for an average person, it could be less than 1,000 individuals. But as soon as the brand responds to that complaint, the complaint, along with the brand's response, would be posted, would appear

Starting point is 00:10:43 on the Twitter handle of the brand. For large brands, it could be potential public exposure, visibility to more than millions of potential audiences. We call this phenomenon firm-induced complaint publicity. Basically, firm by responding to the complaint and advertently basically increases the visibility, if you will, of the complaint. Our full conversation went into detail on exactly how to reply to negative feedback, specifically on Twitter, and whether you should use a separate Twitter account

Starting point is 00:11:14 for your brand just to handle customer feedback. And lots more topics we covered. That full interview is coming tomorrow exclusively to the Premium Feed. You can sign up by going to todayindigital.com slash premium feed. There's also a link in the episode notes. Sign up today to get 50% off your first month. That's todayindigital.com slash premium feed. And finally, Elon Musk's $44 billion takeover of Twitter is currently under review by the FTC,

Starting point is 00:11:46 following concerns about the acquisition's impact on, wait for it, free speech. The U.S. Federal Trade Commission will decide in the next month whether it will pursue an in-depth antitrust investigation. This news coming from Bloomberg. This would delay the closing by months and could trigger even more uncertainty in Twitter's ad business. The FTC declined to comment on the matter. For his part, Musk has not responded to requests for comment, and he hasn't tweeted about it yet. Today apparently is the day.

Starting point is 00:12:23 I know, I'm talking about this forever. The hot tub, yes. Today apparently we are getting the official letter from the senior engineer. We had the deck work done. We had it reinforced. We had the junior engineer come and sign off on everything. We've been waiting a week, more than a week, for this junior engineer to get it on the desk of the senior engineer who can sign off on it. And finally, I will have a piece of paper in my hands that says if this deck collapses under the weight of the hot tub, I can sue someone.

Starting point is 00:12:48 That's basically what I'm looking for, essentially. So hopefully, end of the day, you'll know if you'll follow my Twitter because that will be all I am talking about. And my Twitter account is at Todd Mathen. Also, if you've got something you want to get out to the thousands of people who listen each day, I will read your classified ad right here. It's just 20 bucks. You can book it online. Link in the show notes. Today in digital marketing is produced by Engage Q Digital on the traditional territories of the Tsunami First Nation on Vancouver Island in Canada.

Starting point is 00:13:17 Our associate producer is Steph Gunn. Production coordination by Sarah Guild. Podcast music licensing by Source Audio. Ad coordination by Red Circle, and our theme composer Mark Blevis. He is one of my closest friends, but even he's feeling the hard sting of aging. The other day he walked down the street

Starting point is 00:13:34 and he says, why am I soft in the middle now? Why am I soft in the middle? The rest of my life is so hard. I'm Todd Maffin. Have a restful weekend. I'll see you on Monday. It's the season for new styles, and you love to shop for jackets and boots. So when you do, always make sure you get cash back from Rakuten. And it's not just clothing and shoes.

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Today in Digital Marketing - The Argument for Ignoring Consumer Complaints

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