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MARITIME INSIGHT |Executive Briefing Whitepaper

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Missing the boat? Social Media for Maritime Businesses

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STARK MOORE MACMILLAN

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Introduction I

n a maritime industry contending with regulation, over-supply of tonnage, falling freight and charter rates, and an army of suppliers struggling to sell into it profitably, it may be assumed that an issue like social media would be of low priority indeed. But as social media has begun to dominate the marketing and business development agenda, promising paradigm-shifting opportunities and benefits, many maritime businesses are understandably anxious not to miss the boat. Ship managers, operators and maritime suppliers of all types are keen to understand the reality of what embracing social media means, how it can benefit them and how other maritime companies are using it. In order to provide clarity for senior managers evaluating the place of social media in their maritime businesses Stark Moore Macmillan has produced a comprehensive Maritime Insight Executive Briefing Report. The “Missing the Boat? A Comprehensive Evaluation of Social Media for Maritime Businesses” report offers both strategic insight, practical guidance and clear recommendations. Contextualising social media as part of wider digital trends within the maritime industry and identifying scope for competitive advantage and business efficiencies, it also features analysis of two high-profile maritime social media case studies; maritime supplier ShipServ, and shipping giant Maersk Line. Analysis includes the predicted development of the major social networks, latest social media research findings, the increasing importance of marketing technology, fads versus longer term trends in the digital landscape and their implications for maritime businesses. Clear recommendations about how maritime companies should approach social media as part of their overall marketing strategy and a practical checklist of activities to embed best digital practice into organisations are also provided. Equipping maritime organisations large and small with the information necessary for them to successfully monetise their investment in social media channels and capitalise on the wider digital economy, the report offers a unique resource. This free whitepaper is an extract from the “Missing the Boat?” report which can be purchased online. To register your interest in receiving other maritime intelligence and market insight bulletins and notification of forthcoming research projects and whitepapers please visit www.starkmooremacmillan.com/register

Whitepaper Extract - Missing the boat? Social media for maritime businesses

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Contents Introduction The Social Media Bubble Maritime Attitudes The Maritime Conversation on Twitter - Who are you talking to? Maritime Case Studies - Maersk v ShipServ The Social Networks - A New Class of Share Overall Conclusions About Stark Moore Macmilllan

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Š Stark Moore Macmillan 2013. Disclaimer: While every reasonable precaution has been taken in the preparation of this document, neither the author nor Stark Moore Macmillan assume responsibility for errors or omissions, or for damages resulting from the use of the information contained herein.

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The Social Media Bubble? In virtually every industry the buzz in the marketing deThis lends weight to the widespread belief that many partment is around Twitter, Facebook and LinkedIn, Pinter- marketers are in danger of being drawn in by a blind comest, Google+ and a host of other social networks. But for a pulsion to follow the herd, creating a social media bubble discipline which claims to be able to provide more numbers, similar to the ‘dot.com’ boom-bust investment bubble of the metrics and figures than almost any other, it is surprisingly late 90s/early noughties. hard to trust or contextualise much of it. This is largely because the metrics the social media channels generate are measuring something which until a few years ago, no business had ever tried to put a value on, namely ‘engagement’. 70% of marketing directors are more focussed than ever Now managers are being pushed to assign on social media an ever larger share of budgets which deliver not leads, but ‘likes’, not repeat business but ‘re-tweets’. However, at a time when every business and every marketer is under increasing pressure to justify spend and demonstrate real ROI, it seems there is little tangible evidence to support the claims of those who believe social media is effective. New research carried out by B2B company Pitney Bowes Software questioned both marketers and consumers across Australia, France, Germany, the UK and the USA about their behaviours and attitudes towards social media. It showed that 70% of marketing directors are more focussed than ever on social media, with a quarter of marketing budgets on average expected to be spent on new media activities in 2013 - the UK being the most bullish of all, allocating close to half (47%) of budget totals. Two-thirds (66%) of those questioned claim they are doing the right thing and their campaign investment tactics are effective. But crucially, only one-third (33%) of all those marketers questioned are confident that they can 66% claim their campaign investment tactics are effective establish a link between social media spend and profitability.

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But, only 33% of marketers are confident they can establish a link between social media spend and profitability

Is this the Social Media Bubble?

68%

of people value peer-to-peer recommendations When it comes to social media the single most powerful call to action as far as consumers are concerned is via peer-to-peer recommendations: 68% said they investigated online recommendations from friends or even made a purchase as a result (15%). Research conducted by Stark Moore Macmillan (SMM) shows that within the maritime industry that sentiment is even stronger. Maritime companies trust the opinion of their peers above all else when sourcing and appointing suppliers, lending even more importance to company and product reputation. But social media has the potential to expose brand and reputation to significant harm if programmes are not carefully specified and implemented, so in maritime establishing the real value and contribution of the programme to achieving overall business goals in the first place is of key consideration.

Whitepaper Extract - Missing the boat? Social media for maritime businesses

for maritime those figures are even higher

15% have bought products as a result

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Maritime attitudes Historically the maritime industry has lagged behind others in its adoption of new marketing and sales technologies and strategies. There are still many companies where marketing and digital resources such as websites are dealt with at a purely tactical level, overseen by a Managing, or other Director lacking in formal marketing expertise or training. In very few maritime businesses is there strategic marketing input feeding into the business strategy at board level. However, this is beginning to change. As a new generation of ship owners, managers and suppliers occupy senior positions, the potential and the necessity for improved marketing is being recognised. Another key driver is the digital revolution and the attendant cost savings it offers. Online interaction via dedicated maritime ecommerce platforms is part of an industry wide shift to a digital world, encompassing everything from new ECDIS mandate and the ‘Glass Bridge’, to Crew Payment Cards. In addition, new high-bandwidth IP communications systems such as FleetBroadband and VSAT are now enabling the type of ship-shore communication and Internet use unthinkable a decade ago. With the advent of High Throughput Satellite networks such as Inmarsat GlobalXpress, Iridium NEXT and Intelsat EPIC the pace of change is set to accelerate further. That novel ability of ships at sea and their crews to access bandwidth-hungry applications such as the Internet is opening up new opportunities and markets. The results of the largest crew survey of communications usage ever undertaken offered clear evidence of the extent to which seafarers are using social networks whilst at sea and the extent to which they are prepared to pay for such access. Currently 68% of crew have access to communications at sea and 70% are willing to pay for it. For ship owners and managers wrestling with issues of crew retention, welfare and training, and suppliers looking to reach the crew market with products and services the increasing access to social media at sea has profound implications.

More than at any time in its history the maritime industry is receptive and eager to evaluate how digital technologies can drive efficiencies across their businesses, allowing them to become more profitable in the face of challenging business conditions. It is no surprise therefore that Social Media, an (apparently) low-cost digital marketing channel, is actively being considered by many. But probe behind the superficially impressive growth statistics for social media usage in maritime and a very different story emerges. Our research confirms that a successful social media programme is unlikely to be a cheap option and unless implemented as part of an integrated and technology driven marketing and sales strategy is unlikely to recoup its investment.

“For a number of years marketers have been saying ‘I’ve got to get on that social media train, I don’t know why, but if I don’t I’m going to miss it’. It raises a big question mark over how seriously marketers are actually treating social media in terms of applying the same proper strategy input and planning as with any other marketing channel.”

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Brand Republic. December 2012

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Increasing crew access to the internet at sea has profound implications for maritime and shipping companies. Data from 2012 Crew Communications Survey | Astrium Services & Stark Moore Macmillan

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Twitter: The Maritime Conversation The Maritime Twitter Top 40, a list of the most popular Twitter accounts tweeting about maritime issues was developed and curated by Coracle Online, a maritime training provider and creator of maritime digital products. Between 2010 and August of 2012 the list was updated on the 1st of each month and according to Coracle measured influence, popularity, engagement and trust. The list demonstrated growth of over 400% in two years so it’s natural to assume that for maritime businesses seeking to influence customers, Twitter offers considerable scope. Evidence however, does not support that. SMM analysed the type of businesses in the Maritime Twitter Top 40 and their usage of Twitter across the quarter from June–August 2012 (the last quarter for which fig-

ures are available). The list is almost entirely maritime media groups and publications, Navy, Coastguard, maritime charities, major maritime institutions (e.g. IMO), individual journalists, PR companies and those tweeting solely about maritime piracy. Commercial entities consistently represent under 10% of the list across the three month period. More disturbingly it appears that their potential customers are not the ones following them. Of 1200+ followers of one commercial account only around 2% fell within a very broad definition of potential customers. When it comes to ‘connecting’ with the maritime market it hopes to sell to, the company’s Twitter feed is demonstrably providing a poor return on investment.

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Who are you talking to? ►Number of followers of the feed ►Number of unique references to the feed in Twitter ►Frequency with which feed is uniquely retweeted ►Frequency with which the feed retweets other people/feeds ►The relative frequency of the updates

Ranking Methodology

Growth in Followers 2010-12: Maritime Twitter Top 40

Coracle tracked the growth of the followers of the Maritime Twitter Top 40. On Feb 1, 2010, the then top 40 had a combined number of followers 40,948. By Feb 1, 2011, the number had increased to 94,243, and by Feb 1, 2012, the total stood at 374,236.

Twitter Follower Analysis

Whitepaper Extract - Missing the boat? Social media for maritime businesses

The conclusion reached is that the maritime conversation is being conducted almost exclusively between journalists, some maritime small business owners, and PR & Communications professionals

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MAERSK

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“Social media is about communication, not marketing. It’s about engaging, not pushing. And social media is definitely not just about the media side.

SHIPSERV

“Content marketing is turning your insight and advice into campaigns that change people’s minds and incite action.”

Maersk Line can definitely benefit from this. Time will tell when, where and how.”

John Watton, former CMO, ShipServ

From ‘Why Social Media’. Maersk Website

Maersk Line, a global brand and probably the most wellknown shipping company in the world, chose late 2011/12 as the year it embarked upon its own major social media project which it has described as “The media miracle in Maersk Line.” Maersk’s social media campaign has been an extremely high-profile public relations success. Articles in the maritime press and further afield have focussed attention on shipping and have focussed shipping’s attention on social media. However, there are no hard figures on which to judge the effectiveness of its award-winning campaign. Since Maersk launched its social media channels many social media advocates have featured and applauded Maersk’s efforts, and the company won Social Media Campaign of the Year at the inaugural European Digital Communications Awards in 2012. The panel of judges, comprising social media professionals and academics, described Maersk’s social media campaign as an example for other B2B companies.

ShipServ is the leading e-marketplace in the maritime industry providing “an innovative portfolio of software, services and hosted applications designed by shipping people, for shipping people”. Its core product is TradeNet, an e-commerce platform connecting buyers and suppliers who are also listed in ShipServ’s online directory of ship suppliers, ShipServ Pages. In 2009, having grown substantially in the previous two years, ShipServ still faced a major challenge in educating their risk averse and conservative audience about the benefits of their innovative e-marketplace solution. The initial campaign won the CRM Elite Award by CRM magazine, recognised by the jury for “its holistic use of Marketo, Salesforce.com, and social media”. In the New Media Age Effectiveness Awards 2009 “ShipServ social media” was shortlisted for the best business-to-business campaign. In 2012, ShipServ was nominated by Salesforce.com as one of their ‘Social heroes’.

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Both these campaigns won awards, but as the latest research from WARC (World Advertising Research Council) shows, this is not a reliable barometer of success. In reviewing the maritime case studies it takes little analysis to see that whereas ShipServ can demonstrate a clear ROI, Maersk struggles. In many respects the Maersk campaign reflects a textbook example of how companies are encouraged to view social media, namely as a standalone cost centre which delivers unmeasurable benefits to the business. At the opposite end of the scale ShipServ set out with clear and measurable objectives which they used social media channels as part of a far more strategic, technology-driven digital marketing programme to achieve. One of the most striking differences between the two campaigns is the attitude towards social media within the marketing context. Although ShipServ’s campaign had a major social media element, it was only part of a far wider digital marketing strategy. Maersk insist that social media is not about marketing - yet all the goals it sets its social media programme are core parts of the marketing function. Maersk has been held up as an example for other B2B businesses to follow in social media, but its campaign cannot be recommended as a blueprint for other maritime companies, partly because Maersk itself is unlike any other maritime company. By contrast the demonstrable and measurable return on ShipServ’s campaign offers a far more useful example for the vast majority of maritime businesses. ShipServ have shown how a relentless focus on researching and understanding customers and using marketing technology to capture and process data can dramatically improve marketing and sales integration and revenue.

There is no doubt that the Maersk social media programme has been a considerable public relations success and the company should be congratulated for seizing a thought-leadership position within the industry. Unfortunately by encouraging other businesses to abandon the kind of targeted marketing and return on investment considerations they are in need of, the company risks not only being caught up in the social media bubble itself, but causing other maritime businesses to be so. By being as transparent and open about the significant costs of its programme and its lack of measurable return however, Maersk is running the risk that its positive PR could backfire. Describing an investment of almost a million kroner as ‘peanuts’ suggests an alarming lack of insight not only into the other businesses with which it shares the maritime space, but to employees, stakeholders and also the customers it hopes to serve. The key to efficient marketing today more than ever is targeting and relevance. A global, well resourced company like Maersk and its understanding shareholders may be prepared to take a leap in the dark, but it is one of perhaps a handful in this huge maritime industry who would be prepared to spend close to DKK1million on a project with no defined objectives, reaching out to a large group of untargeted individuals, at least 80% of which will never buy from it with the vague likelihood of a return to the bottom line sometime, somehow, somewhere. For the vast majority of maritime companies this would be an untenable position.

Maersk describe the costs of their social media campaign as ‘peanuts’, but it would likely cost another business DKK910,000 to replicate.

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The networks may have been built on sharing, but they can no longer afford to share their customers.

The Social Networks: A new class of ‘share’ There is broad consensus that mobile will be the platform of choice for the future. However, for Facebook, more views on mobile mean less chance for Facebook to serve up the ads upon which its revenues depend. As a result it is essential that Facebook keep users on their site, controlling the user experience in order to protect their ad revenues. Evidence of the focus on mobile came in the January 2013 Facebook results which showed mobile revenues increased to 24% of advertising revenues, up from 14% on the last quarter. Its May 1st 2013 results showed an increase in both daily and monthly users, and mobile users up a massive 54% year-on-year to 751 million. But the question is whether this increase in mobile users will be enough. As mobile use increases industry analysts expect Facebook to adopt a far more aggressive strategy to monetise the ‘eyeballs’ and personal data it holds on its billion users. It has little choice in order to satisfy its shareholders. Based on past experience, the likelihood of a consumer backlash against the network cannot be underestimated. In short, the networks may have been built on sharing, but they can no longer afford to share their customers. As a result 2012 saw a profound change in the way the social networks integrate. Users discovered that their Tweets could no longer be automatically posted to the LinkedIn network, whilst Twitter bought up TweetDeck – a social media analytics tool which allows cross-network posting and insights. At the same time the promise of LinkedIn

groups which appeared to offer organisations a golden opportunity for engagement with specific audiences, seems to have largely evaporated. Anecdotal evidence is widespread of users disengaging with Groups due to the level of rampant self-promotion, poor quality of discussions, spam and job posting. Many LinkedIn users are beginning to post requesting that other members who notice the posting ‘like’ it, simply in order to gauge the real level of engagement their efforts are receiving. For Group Owners it is an increasing struggle to monetise the considerable effort needed to monitor and maintain such Groups. Once again, engagement has not translated into bottom line impact. But there is little alternative. Having built their social media group on LinkedIn, there is no easy way to migrate that to another platform. And that is how the social networks need to keep it. Facebook and LinkedIn want companies to draw their customers and stakeholders - and in the case of maritime, their industry - to their social network. If you follow Maersk on Twitter, are part of their groups on LinkedIn or are a fan on Facebook, you can be sold to any company who wants to get in front of the maritime market. For the maritime industry it raises an interesting and fundamental question. Are the benefits of social media significant enough to outweigh handing data on all your stakeholders, customers, employees and contacts to someone else to exploit for profit?

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Conclusions “It is hard to recommend that any maritime company in 2013 assign any sizeable budget to a standalone social media programme, or a social media expert.”

Good Marketing is based on trends not fads Digital, not social, is the trend There is a widespread and understandable belief that social media marketing somehow exists outside of established marketing ROI considerations. It does not. As a result many maritime companies believe they require help devising a social media programme, when they don’t yet have a basic company marketing strategy in place. All the evidence suggests that standalone social media campaigns are rarely successful: for social media to contribute real ROI it must be as part of a more sophisticated, digital and data-driven marketing approach. To address this the Missing The Boat? report provides six key strategic recommendations and

eight tactical recommendations together with broad organisational advice for larger and smaller maritime businesses approaching digital and social marketing in 2013. In conclusion it is hard to recommend that any maritime company in 2013 assign any sizeable budget to a standalone social media programme, or a social media expert. However, where social media can make its most significant contribution is by focussing shipping and maritime companies on digital—the single most powerful and disruptive influence on their industry—encouraging them to analyse the emerging digital landscape, prepare for, and take advantage of it.

The full Missing the Boat? A Comprehensive Evaluation of Social Media for Maritime Businesses report is available to purchase as a digital download online at www.starkmooremacmillan.com

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About Stark Moore Macmillan Occupying a unique position within the maritime industry, Stark Moore Macmillan (SMM) has become recognised for its leading-edge data and interpretation, and strategic insight Both independently and in association with major industry partners, SMM undertakes studies to address gaps in understanding and identify trends within the maritime sector. A combination of knowledge, strong relationships and unparalleled market insight contribute to a rolling programme of in-depth, high-quality maritime market research which regularly produces ground-breaking studies and results against which the industry benchmarks itself. In addition to producing a variety of market research and insight reports for purchase SMM also work with individual clients in a strategic capacity at board level. Utilising their specialist knowledge of the maritime market SMM’s highlyexperienced senior consultants review and analyse existing and proposed maritime offerings, assisting clients in the development of maritime market oriented strategies to achieve sustainable competitive advantage. Their understanding of maritime customers, stakeholders and markets together with the crucial technological, economic and regulatory environment help them to frame strategic market plays and shape product development designed to achieve revenue and business objectives. SMM regularly work with companies and investors considering entering the maritime market, providing strategic marketing input to business cases and funding proposals alongside corporate finance and other professionals to create fully researched and modelled propositions. The company regularly shares its insight with the industry via whitepapers, press articles and conferences and its consultants contribute their significant expertise on a voluntary basis to a variety of maritime industry associations. The infographic (right) is taken from the 2012 Astrium Crew Communications Study. Download your free copy of the whitepaper, and other SMM reports and register for updates at

www.starkmooremacmillan.com In 2013 Stark Moore Macmillan will publish its Maritime Insight Report on marketing automation programmes. To be notified when the report is available register online now.

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Free Extract

To purchase the full report as a digital download please visit www.starkmooremacmillan.com

Missing the boat? Social Media for Maritime Businesses

MARITIME INSIGHT |Executive Briefing Whitepaper

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Stark Moore Macmillan 20 Hanover Square | London | W1S 1JY T: +44 (0) 207 127 4262 | F: +44 (0) 207 127 4263 E: Info@starkmooremacmillan.com W: www.starkmooremacmillan.com

STARK MOORE MACMILLAN

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Š Stark Moore Macmillan 2013

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