The Social Media Monster

Terrifying.

This may seem weird to those of you reading this blog, as I assume you are familiar with social media (how the devil else did you get here?), but some people are actually out and out afraid of social media.  They see it as some sort of horrendous million-mouthed beast that's going to turn around and bite them at any second and without warning.  Crucially, they fail to see that this brute will only become this horrifying creature if they don't tame it by engaging with it.

In its simplest form, social media is talking to people and you know how to talk to people, right?  Most of us will quite happily flap our gums at any given opportunity at any time, day or night.  People in customer service roles are usually more adept at this than most.  What we're finding with social media, however, is these people who have previously had no problem with interacting with their customers via the telephone, post, email or other forms of physical communication suddenly shrink back when you mention Facebook or Twitter.  These are evil, dreadful things that should not be touched or looked directly in the eye, lest they lose their temper and destroy you.  Heaven forbid you have to address your customers' concerns directly in real-time on a social network - they might ignore you and write nasty things about you on the internet!

Not pictured: reasonable customers.

I hate to be the one to tell you this, but no matter who you are - whether you're a cigarette manufacturer or a children's charity - people are already writing nasty things about you on the internet.  The propensity for a certain kind of person to baselessly complain has not disappeared by hiding them behind a keyboard, but has in fact intensified their vitriol as they have had the cloak of anonymity cast over them.  You are never going to escape these people, whether you are on social networking sites or not, but by not engaging with your customers on the web you are creating even more monsters by not addressing the complaints of your more reasonable customers.

Disclaimer: this is not a suggested social media strategy.

A negative customer experience can be easily turned into a positive one if your social media representative has any sort of social skills.  Ultimately, customers just want to be spoken to civilly, politely and by someone they feel sympathises with them and will solve their problem.  The excellent thing about doing this via social media that sets it so far beyond traditional mediums is that this good experience is viewable by anyone and everyone and, more often than not, a pacified customer will mention what good customer service they received from you.  This good word of mouth is then immediately passed on to their social graph, encouraging them to become future customers or to engage you with their own issues.

It could shock some of the fraidy-cat companies to learn that 78 percent of their customers trust peer recommendations over advertisements, which only 14 percent of people trust, and that  96 percent of Millenials (that's people born between mid 1970s - early 2000s to you and me) have set up at least one social networking profile.  That's 96 percent of over 50 percent of the population who are talking about you online without you being there to do anything about it.  Most of this 96 of 50 are not monsters - they are the same customers you've always had and are fairly rational, reasonable human beings - but the very nature of the internet means that whatever anyone says about you instantly spreads like a virus into their own social spectrum and often beyond.  Ignoring their complaints online is akin to not answering your complaints phone line or burning their letters - it's just inexcusable and will do nothing except lose you customers.

In closing, there is really nothing scary about social media unless you are scared of talking to your fellow human beings.  All basic, positive social media practice requires is for you to be able to empathise with your customers, verbalise yourself well and deal with complaints confidently and calmly.  That's it.  No fancy tricks, just treat them like real people and they will respond in kind.  You are always going to have people who will not be satisfied with any solution, but by using social media efficiently you limit their numbers and show them for what they are while creating gratifying experiences from unpleasant ones for your other customers.

Be not afraid of the beasties under the tweets!

'Cause We Are Living in an Immaterial World...

A friend's plight, and the fallout from Zynga's abolishment of Street Racer, set me on the path to thinking about how we deal with digital assets in a world that hasn't yet realised that they are the digital representation of a physical asset and so is valuable.

Let's look at how this is effecting Joe Blogs on the street first.  Mr Blogs has been having some financial trouble as of late and is unable to pay back his debts - as a result he has to declare bankruptcy.  Normally when you declare bankruptcy, your non-essential assets are sold off in order to pay back your creditors, however in my example Joe Blogs has very few physical assets to be sold off.  He has his laptop, which he uses for work and so has to keep, but he spent most of his previous leisure time playing MMORPGs, listening to music, reading ebooks and social networking.  As a result of this, Joe has very few physical assets but has thousands of pounds worth of digital assets.

Currently, these digital assets are ignored - they are not seen as being worth anything.  The reality, however, couldn't be further from the truth.  Joe has a World of Warcraft account, with four characters that would be worth circa £700 each on ebay; he has around £5,000 worth of music, ebooks and movies on his laptop; his Steam account has £500 worth of games downloaded to it, and he owns seven valuable domain names that are worth about £100 each.  The collective value of his digital assets is around £9000, which far outstrips the value of the rest of his physical property combined.  At time of writing, there is no way for the accountants, or Joe, to access these funds.  Joe can't sell on his mp3s or ebooks as they only work with his iTunes account; he can't sell his World of Warcraft account as selling it is against Blizzard's EULA and though he personally can sell on his domain names, the accountant cannot do this for him.

Joe does not own his own property beyond using it for its single intended usage.  This seems simply nonsensical in a world that is increasingly digital.  Why is it that if I buy a CD in a shop I reserve the right to sell this on once I am done with it to whoever I wish, but I cannot do the same with the eight mp3s that make up my "Fame Monster" album?  Why are the terms of use so restricted just because we remove the physical element?  Why is it suddenly apparently worthless to anyone but me?  The fact of the matter is that it isn't.  My CD is still worth what someone will pay for it, but it's made impossible for me to sell it on.  Joe's £9000 worth of digital assets?  Effectively worthless.

Now let's look at how this effects businesses.  Zynga, creator of social games on sites like Facebook, has come under fire after announcing they were abolishing one of their games, Street Racing.  The reason this has caused so much consternation is that Street Racing, like many of Zynga's games, employs the use of microtransactions to allow players to customize and upgrade their vehicles.  For those who don't know, a microtransaction, in this situation, means the player pays a small amount of real money for access to digital content within the game.  Zynga have faced a lot of criticism for people who have sunk a lot of their hard earned cash into the game - abolishing the game effectively means Zynga is taking their money and running without consequence.  It's tantamount to you buying a diary in real life, using it for a little while, then having WHSmith come into your house and take it away without explanation, your notes and dates still in it.  Of course, in the real world, businesses would never get away with taking away something that a consumer had already paid for and taken into their possession, but for some reason when we move these transactions into the digital realm it becomes common practice and seen as bizarrely ethical.

There was another example of this back in 2009, when the initial Kindle ebook reader launched.  Amazon released a number of George Orwell's books that later had to be withdrawn for legal reasons.  However, the books were not just withdrawn from the store, as you would imagine, but removed from the libraries of consumers who had already bought and paid for it.  The owners of these books were not made aware this was happening and were understandably upset that Amazon felt it had the right to delete things from their Kindle libraries, that they had previously perceived to a personal and private piece of property.  They were sure, as had come before, that once you buy a copy of a book, the store no longer own the rights to that copy.  Not so, said Amazon.

The world is clearly in transition, between being focused on what's real and can be held in one's hand and the increasingly immaterial world we inhabit in our daily lives.  I personally spend probably as much time on social networks as I do actually speaking to people face to face - does that mean those interactions are worthless because they were not physical?  No, and my property isn't worthless just because it's not physical.  We are locked in a power struggle over our own personal assets.  Companies want to retain the rights to their intellectual property to prevent people stealing it, and consumers want to retain the rights to their digital property to prevent companies stealing it back.

At the moment I cannot see any simple solution.  In times to come will we be able to sell these digital assets back to companies at a reduced rate in the way that one can trade in a game for cash at a store?  Will we be able to auction them off them on eBay?  Will we see digital repo men invading our networks and stripping our hard drives of all that is valuable?  Will they come for our MMO characters if we fall behind on our subscription?

It seems impossible to predict how the power balance is going to shift, but with the rise in social networking many of these apparent injustices in DRM are not going unnoticed and are hurting their brand as much as the company feels they may be protecting it.  Perhaps that is where the battle will be fought, and the war ultimately won - power to the people.

Chancellor Vows Support for UK Games Industry: Too Little Too Late?

Alistair Darling's delivery of the budget for the coming year was greeted with a triumphant cheer from the UK's games industry today. Few could believe it when Mr Darling announced that he was introducing long awaited and hard lobbied tax breaks for the industry, and not only that, but that he was also going to do this in line with TIGA's previously announced tax relief plan.

To this effect, developers that create profitable games will now be able to use the relief to pay less tax on profits, while unsuccessful games will be awarded a cash tax credit to reduce losses. This should free up cash to spend on other projects or creating jobs for the increasing numbers of stellar graduates that British and overseas Universities are producing year on year.

Scottish developers are delighted and are basking in the warm glow of victory. Colin Anderson, Managing Director at Denki, said, "Games Tax Relief will stimulate much needed investment and innovation in one of the UK's leading knowledge based industries. The leadership TIGA has demonstrated throughout this debate has played a decisive role in getting Games Tax Relief on the political agenda and in to today's Budget."

And Colin MacDonald, Studio Manager at Scottish industry giant Realtime Worlds said, “The UK video games industry is one of the most creative and innovative in the world. This decision will mean we can continue to invest in UK talent and prevent brain drain to our overseas competitors. This is a great day for Scottish and UK-wide developers. It is also a major achievement by TIGA.”

The news of the tax breaks, and the form they are taking, was welcomed by TIGA. CEO Richard Wilson said "The Government's decision to introduce Games Tax Relief in today's Budget is an inspired decision. It is good for the UK games industry, good for consumers of British video games and good for the wider UK economy.

TIGA's research indicates that over 5 years Games Tax Relief would create or save 3,550 graduate level jobs; increase and safeguard £457 million in new development expenditure and ‘saved' development expenditure that would be lost without the relief; and generate £415 million in tax receipts for the Treasury, comfortably exceeding the cost of Games Tax Relief. Games Tax Relief would also encourage game developers to adopt new online, more sustainable business models and sell directly to the consumer."

For Scotland's games industry this is big news, as two major titles, Crackdown 2 and APB, are expected to emerge by quarter 3 of 2010. Provided these games are profitable, their developers, Ruffian Games and Realtime Worlds respectively, could stand to reap the rewards and this should have a knock on effect on a large scale with other local companies and Scotland's Universities.

Potentially this also will bring a sigh of relief to those companies whose commercial successes have, so far, been few and far between as they will be bolstered by the incoming cash tax credit, and overall this might lead to fewer British games companies going bust. Again, this stands to encourage ongoing employment and give these companies more breathing room to grow.

However, this may come as too little too late. With a general election expected to be called within the next six weeks, the Conservatives, currently tipped to win an upcoming election, have vowed they will enact an "emergency budget" within 50 days of coming to power, obliterating many of the more controversial and surprising of Darling's moves. As the Conservatives have not, at any point, indicated support for UK games industry tax breaks, we can't be sure that this would remain as part of a Conservative budget.

Though this shouldn't quell your enthusiasm or celebrations and in all actuality there's no real indication that the tax breaks would be at risk of removal under a Conservative government, we must bear in mind that much of what was in today's budget will have been included on the basis that it will encourage votes for the Labour government.

Let's not count our lemmings before they're out the door...