In one of my classes, the guest CEO/chairman speaker was Shelly Lazarus (Ogilvy & Mather). When asked about her involvement/interest in social media, she mentioned that it was not yet worth getting into it, as nobody is sure of the returns on that investment. With all the buzz about social media, I found the comment startling. However, that seems to be the view echoed by the CEO’s of the top 100 companies of the Fortune 500, as highlighted in a survey conducted by UBERCEO.
Key Takeaways:
• None of the Fortune 100 CEOs have a blog.
• Only two CEOs have Twitter accounts.
• No more than 19% of CEO’s have a personal Facebook page
• Just 13 CEO’s have LinkedIn profiles, only 3 having more than 10 connections.
As discussed in class, social media does provide an excellent platform for executives to connect and engage with their company's customers. And a lot of CEO’s are just doing that. A great example of a CEO who has used social media to his company's benefit is Zappos CEO Tony Hsieh, who has over 1.6 million followers on Twitter. Clearly, Zappos (now acquired by Amazon) is not a Fortune 100 company, but it's of respectable size with roughly $1 billion in annual revenue.
The key question that comes to my mind is this: Is it realistic to expect that Fortune 100 CEOs can engage their customers with social media well? Clearly, the CEO’s face a lot of regulatory constraints, which places limits on what they can communicate. In addition, they risk offending customers, partners or the Board of Directors with the added risk of litigation. Another key factor is time. Can a CEO really follow “conventional” wisdom around being social and be willing to tweet four or five 100-character statements a day? That’s a lot of time for a CEO. Even if he or she manages to do it, do consumers really want to connect and engage with the CEOs of these companies? Warren Buffett has less than 31,000 Twitter followers! One of the most revered investors has a miniscule number of followers in comparison to Ashton Kutcher and Britney Spears. So, it's probably safe to say that consumers are not going to be terribly excited to tweet with Vikram Pandit, the CEO of Citigroup or Brian T. Moynihan, CEO of Bank of America. Most likely, all they care is the safety of their money in their bank account.
So, essentially, there are two sides to the story. Social media tools help the CEO to directly meet real customers and employees, without getting filtered by layers of mid management. In a way, it provides a first-hand knowledge gathering and monitoring framework which was unavailable to previous generation of CEO’s and can help them to be in tune with reality. At the same time, a half-hearted approach by CEOs will be easily picked up by customers and can cause incalculable damage to the brand. Social media is increasingly being used by brands in more sophisticated and enlightened ways and the CEO should exude that.
The other side is setting the balance between listening and disseminating. Initially, the CEO would have their CMO’s ghost write a blog to broadcast information, but didn’t pay much attention to comments from customers. That has changed now. Now, it’s more likely to be a two-way interaction and the pace of feedback makes it increasingly personalized. And every CEO will have a learning curve to get this balance right.
In the future, the Board of Directors will factor in “Social media skills” for evaluating potential CEO’s. So, this will have to be part of their arsenal to communicate with the Twitter and Facebook generation.
To quote Glen Hilton, CEO of ImageX media: A colleague asked “Whats your ROI on twitter”. I asked him what his ROI was with our relationship. He got it.
And in a crisis, having this kind of relationship with customers is invaluable. Just ask Akio Toyoda.
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