Social Media – Sid thumbs up; Seth not so much

The very interesting Sid Fernando blog recently wrote a piece on social media and racing. In the article he extolls some virtues of Twitter and Facebook for racing, and quotes one of the aggregator news kings for racing, Seth Merrow of Equidaily, saying that these tools “have F-A-D written all over them.”

It should come as no surprise that I (and my colleagues here at r2) agree with Sid and disagree with Seth. I’ll tell you why.

When looking at old school marketing (pre 1990′s) we were marketing only to the masses. We would try our best to “demographically max out”, by weeding bad populations the best we could. Still it was a crap-shoot. Demographic marketing did do some good, but it was still very inefficient. If we fast forward to 2009, we are no longer so constrained. With the use of social media tools we can not only speak to our mavens, our customers, or our potential customers directly and with laser-like precision, we can also learn quickly what we are doing right, and what we are doing wrong. This helps us improve our business.

The examples from the business world are there, and are we are seeing more and more stories every day.

In about 2005 Dell Computer had one of the worst customer service and general satisfaction numbers, of any of the computer makers. Sales were down, and a big reason why was given to the bad press by the Dell community. Websites like ihatedell.com popped up and well over 50% of all comments on Dell on the web were negative. Michael Dell decided to do something about it – and he turned to social media. Within a month a direct to Dell blog was started. The complaints flew in. They did something about them.

With sales slowly doing better and negatives down, the next step was launched. Dell Idea Storm was created to ask customers opinions and ideas that Dell could use  to make a new product, or an old product better. Some of the items you see today (like a Dell laptop with Linux) are because of community and social media.

Dell is currently looking to expand their social media in dozens of languages so they can grow throughout the world. In just a few short years they used the simple tools of community marketing and CRM, and redefined who their company was.

Think about the above and then transpose it with racing. When signals are withheld (like we are seeing now with Twinspires and the Mid-Atlantic tracks), horseplayers suffer and they complain. Where is Churchill’s response team? When a questionable inquiry happens and horseplayers are wondering why a call was made they complain. Where is the stewards’ twitter account explaining what happened? Just like Dell or any business you will have comments and complaints from people who have axes to grind, and they will cause you more trouble than they are worth, but the community will see through those. If a company like Dell finds these tools essential, should a business that has been around for 300 years not find it essential too?

Some customer groups are building communities to answer these questions in racing, like the HANA Report section of the Horseplayers Association of North America blog. It is interesting, in this age that our customers are creating these sites with social media, but the protagonists who need those same customers to survive (for the most part) are not?

I went to a search engine marketing function this past week. I was speaking with a colleague about social media and its role in building a business.  He simply stated that “if we position our clients right, it can be more, or as important as any type of advertising, at a fraction of the cost”. It is not a panacea, it is not utopia. But it is a part of business that needs to be embraced, or you will be left behind.

In the end, to me social media is no more a fad than web search is. It is a part of our daily lives and will be forever. Accepting that as fact, using it, perfecting the way we use it and growing racing with it should be the only things we are worried about.