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There has been written a lot on the impact of Social Media on the TV industry, by us and others. In a previous article on AppMarket "Social TV's State of the Industry" we came to the conclusion we're nearing or are at the tipping point of Social TV's hype and has to prove itself.
This is also the time where we need to broaden the impact and potential and go beyond the conventional angles of Social TV, when we talk about Social TV we are really talking about it enabling the organization to be a more Open Business. The essence and goal is opening up the business and its processes directly and indirectly to external stakeholders, for the purpose of competitive advantage in marketing, service- and product innovation. Organizations become better aligned with the needs of their customers and ultimately be a better business with a better output.
Put in another way, according to the MIT Centre for Digital Business, in order to cost-effectively solve broad business problem and co-create e.g. a new product choice, a marketing campaign or a new service experience, enterprises need to start taking advantage of the "wisdom of the crowds" available though social media data, or risk missing out on huge opportunities to boost business.
So what does Social TV enable for an Open (TV) Business?
Think of Social TV as a door to the outside world. A door to listen, ask, connect and create with people outside, both partners, customers and experts. With -for example- a whopping 1,5 billion Facebook Likes and 1 billion tweets, the entertainment and TV industry is a privileged vertical having all this attention, intelligence and participation in the open. By opening up the organization to its external stakeholders and making use of all this interaction in various ways, value for multiple departments (ie. the total organization where possible) is enhanced.
Social Media can be applied for Engagement, Insights, Co-innovation and Change.
Engagement is often the current focus, creating marketing strategies with social media components to reach out and achieve certain goals. But also think about the shows and content itself, transmedia. Social networks can be used as intrinsic part of the content, think of the Facebook movie "Him, Her and Them". A content focused example is that real-time interaction and engagement will enable (live) co-programming, taking into account the good and bad opinions of viewers into the format for any relevant kind of use. This brings forth both insights and co-creation.
Social Media is the nirvana for research, lots of answers with no questions. Social media data uncovers consumer insights, market- and competitive intelligence which can be used to stress test current shows and content, but also discover new and unmet needs. Open TV offers rich and qualitative measurement on a scale and iteration never had before which for content producers and brands is an USP. Facebook profiles contain rich data which can be analysed for the purpose of higher premium advertising rates, better understanding of consumer interests and thus aligning brands to them. Insights in viewers also enable more appropriate shows for different channels and target audiences. Both applications of real-time insights are elaborated here.
Social Media offers the opportunity to co-create innovations with external stakeholders (be that consumers, partners, experts etc) in a scalable and efficient way. Co-innovation enables rapid validation in order to achieve better output-to-market, faster time-to-market and lower cost-to-market. TV shows and content get less dependant on third parties (such as agencies) and advertising because these very co-creators are the organization's advertising force as well. People care about what they create and buy in to it. Business agility and continual innovation are fueled by Social Media.
Other reasons why TV should adopt co- / open innovation can be found here. For all the TV industry players who have troubles innovating their business model, value proposition and more, open innovation is a great way to enhance competitiveness.
Social Media is here to stay, certain social technologies and platforms might vanish, but the behavioral and cultural shift is here to stay. With this given, organizations have to adapt. Think of what Darwin said: "It is not the strongest species that survive, nor the most intelligent, but the ones most responsive to change". Organizational change is a big challenge, not only adapting to the outside, but also what it means for the internal organization. A TNO study has shown that Social Media usage leads to innovative employees. By understanding the impact on the organization and its different departments, ROI becomes clear.
TV industry and (external) value networks
The TV industry is huge and morphing fast. The TV screen is becoming just one of the screens which are available to consumers. In terms of Porter's five forces model, this means an increase in competition from all the five forces.
Value chains are transforming into (external) value networks, which means to be responsive to change we have to open up the chain and include external stakeholders in an open environment/network. This has as outcome the three enablements as mentioned in the co-innovation section.
Next to be more adaptable, the industry has to be more innovative to be unique, to be wanted. Co-creation enables unique and differentiated experiences. Here I've explained how the two aspects achieve an unique experience, basically looking at the core competences and brand equity of the company and the unique perception and producing of viewers/consumers.
LostRemote wrote an article "Why social TV will be a multi-billion dollar business", approaching Social TV as a means to become an Open Business, the dollars will be even more, being more innovative and creating competitive advantages throughout the complete TV organization.
To learn about and contribute to the understanding of Open Business, follow #openbusiness on Twitter. (Initiative by the Open Business Council: a collaborative space run and owned by its members. It is administered and supported by 90:10 Group, an Open Business Consultancy.)