A couple of months ago I was asked to write a document about PR 2.0 for a private individual looking to invest in an agency and get a foothold in social media PR. As the investor has now made their move one of the backgrounder documents can now go public. Incidentally the investor has also put significant funds into agricultural land/farms and farm machinery manufacturers (they see climate change, increase demand for food and need for bio-fuels from crops as key drivers over the next 5 - 10 years).
This is an extract from the overview document.
New market dynamics – new style PR agency
Overview
In the last few years a number of factors have converged to create the conditions for a massive change in consumer communication and purchase behaviour driven by digital technology. These are:
- The availability of cheap online storage
- More powerful and lower cost PCs and other digital devices
- Quicker broadband connections
- Easier to use web based software application solutions
PCs, software and personal digital devices (smart phones, MP3 and video enabled devices) are no longer regarded as purely ‘geek or youth’ technologies but have become an everyday consumer product used by the broad mass of the population.
These factors will in turn impact the way that companies can (and will have to) engage, build and develop relationships with these new digital enabled consumers.
The emergence of the PC as a business tool in the mid-1980s means that it is only those aged 65+ who missed some exposure to the digital revolution and many of those have been engaged through special Government initiatives plus their children and grandchildren. Last year Saga1 started its own social networking site aimed specifically at the 50+ age group. Recent figures suggest it has already attracted 30k+ members.
It should be noted that Ofcom2 research has shown that 22% of all social networking site members – Facebook, MySpace etc - are aged over 50. Research by Hitwise2b showed that ‘silver surfers’ (aged 55+) now make up a large percentage of people online. With an aging population it will mean that the 55+ group will soon be the largest online group. Whilst they may well be less active online than younger people in terms of hours spent online they do have greater disposable income.
The Ofcom2 report showed that an ever more savvy cyber-enabled youth has emerged. 49% of 8 to 17 year olds have profiles on a social media site. Another Ofcom3 report shows over 50% of 8 – 15 year olds now own mobile phones and over 1/3 of all calls made in the UK are via mobile phones. Over 20% of people with mobile phones have taken and sent pictures to friends or loaded them on social networking sites. The use of video on mobile phones is also increasing rapidly as is the consumption of online video. In December 2007 ComScore4 estimated that US consumers watched 10 billion videos online.
During 2007 15% of all retail sales were done online5. January 2008 sales reached an all time high with 4.4 million translations being made on Christmas Day itself6 when many retailers started their special sales. Research by Ofcom7 shows the UK a leading country worldwide in the availability and use of digital TVs, mobile multimedia and broadband service access.
Just as the internet opened up e-commerce and e-mail so Web 2.0 and social media is changing the way people can communicate as well evaluate and make purchase decisions. PR organisations should be aware of these developments and ensure their clients have strategies to address this new digital world.
Communities of influence have existed in many forms in the past. Subject matter experts have always been sought out either within the physical community or through traditional media. Today the internet and communications taken together with social media software gives subject matter experts a global reach. Equally online consumers value independent and knowledgeable advice. Edelman PR8 has been doing their annual Trust Barometer for almost 10 years. During that time it has seen consumer confidence (or is that a reduction in deference to the ‘establishment’?) in media and the state decline. ‘People like me’ are now the most trusted sources of information. With the advent of social media software and the internet ‘people like me’ can now be found easily and globally. As has been said – we all live in a global village.
There has been debate as to the nature of ‘friendship’ in the online community or global village. Anthropological8b