Marketing Strategy: Dangers of Profiling in Social Networks

Social networks have become ubiquitous in our lives — especially if you’re under about 30.  This growth has fueled business attempts to capitalize on social networks as a tool for marketing their brands.  To the extent use of social networks as part of their marketing strategy has created engagement with consumers, the utilization of social network marketing strategy has been a good thing.

Consumer profiling is an important part of marketing strategy. Profiling allows companies to identify the most likely prospects for their products.  For instance, if a consumer visits university websites, they are likely candidates for all kinds of products aimed at college students including moving vans, used textbooks, and credit cards.  Profiling also allows you to know more about your target market so you can craft advertising messages for maximum impact.

Unfortunately, like all good tools of marketing strategy, social networks are ripe for abuse by firms who don’t realize how to use them correctly.  As social network technology has evolved, so has the potential for abuse.

Profiling

One profiling to is the use of clickstream data to build a profile of an individual consumer or even groups of consumers to help improve your marketing strategy.

1. For instance, Forrester Research has a tool (Empowered) that can be embedded in your blog, etc to help you determine what kind of social relationship your target audience is ready for.  Empowered is free and is based on survey results.  It categorizes a target market based on age, country (or countries), and gender into one of 6 overlapping categories: creators, critics, collectors, joiners, spectators, and inactives.
2. eXelate Media also has a product in collaboration with Nielsen to use Nielsen’s databases along with eXelate’s data on consumer’s online behavior to generate better consumer profiling that helps build the right marketing strategy.
3. Journals such as American Demographics and Ad Age contain profiles of consumers for various industries in the US market.
4. In addition to these tools, a number of consumer profiles are available through trade publications.

Profiling on Social Networks

A new marketing strategy tool is the ability to track consumers using social networks.  For instance, you can track consumers and profile them using the Like button on Facebook.  The thinking is that if you like a company, its brand, or related products, you are a good prospect and marketing to you can lead to sales or increased sales.  Other tools are linked to posts on Facebook, LinkedIn updates, and tweets. By trolling this data, companies believe they can construct detailed, accurate data to guide them in marketing to their target market.

The Dangers of Profiling in building marketing strategy

The problem occurs when companies put too much faith in the profiles they develop.  Because profiling uses historical data, there are several reasons the data might not be accurate.

1. Historical data only incompletely predict future behavior.  Lots of factors change over time and historical data don’t reflect any one of them.
   1. For instance, you may no longer need a particular product types — a newborn will eventually grow up and no longer needs diapers.
   2. You may decide you no longer like a particular brand.  Since there really isn’t a don’t like button, this information can’t be used to update your preferences.
2. Online behavior might not reflect YOU.
   1. Someone else may  be using your online persona.  For instance, a faculty colleague posted on his Facebook wall today that his son had been using his Facebook and he was now associated with the gaming sites and Likes his son input while logged in as him.  This can happen inadvertently.  For instance, the other day my daughter used my laptop.  I then made some friend requests, sent some messages, and posted comments on several blogs thinking I was using my Facebook profile. Since she was the last one to log in, however, all these online activities were attributed to her Facebook.  She was a little miffed later in the day when she got emails from some of the folks I had interacted with using her persona.
   2. Your behavior may reflect favors you’re doing for someone else.  For instance, my daughter is looking for a nursing job.  I’ve been helping her in her job search.  However, I have no desire to buy the scrubs or subscribe to the nursing journals I’m getting email offers from.

The take home message from this is that profiling MAY be an effective tool in your marketing strategy arsenal.  However, don’t put too much faith in its predictions of the behavior of an individual consumer.  Profiling is MUCH more effective when employed to understand groups of consumers.