Why do some customers choose your business over others? How is it that some companies get shared on social media while yours gets no love? Why do some customers refer friends while others don’t?
A new model of approaching our customer relationships may have the answers. Social currency is a way to understand the value businesses add to customers. Knowing how to develop social currency allows brands to drive higher customer loyalty and build social proof. This leads to more referrals and sales.
In this post, we’ll discuss how social currency plays a role in your customer relationships, as well as how that can benefit your business. We’ll also share how you can earn more social currency, and use this to grow your business.
What is social currency?
What is social currency? It’s basically your influence and presence on social networks, other online spaces, and offline, and the degree to which your business is shared by your customers. You provide information to others, and that helps define your identity through social channels.
What makes you interesting? Are you doing anything that will make yourself stand out from your competitors? If so, you probably have social currency.
In many ways, a customer’s journey from browsing to purchasing a product is fairly straightforward. But turning your customers into advocates requires adding something extra – that something extra is social currency.
Social currency explains your business’s social relationship with its customers. A study by Vivaldi Partners explains it like this: “Social currency measures the ability of brands to fit into how consumers manage their social lives in today’s digital and mobile age.”
Here’s an overview of what social currency means to individuals and brands:
The social currency of individuals
People share what they think will make them “look cool.” In other words, they’ll only share what they believe will maintain or increase their reputation in the eyes of their peers.
Whenever they choose to share information, a person “spends” social currency and places their reputation on the line. They don’t want to share boring, irrelevant, or misleading information, because then they risk losing their status among their peers.
The social currency of brands
If someone chooses to share your brand positively, they spend social currency on you. And if their friends like what they see and hear, this increases the social currency of both the sharer and your brand. Increasing your brand’s social currency is all about making your brand trusted, relatable, and shareable.
All businesses use social currency, and for a good reason. Putting your best foot forward is a great tactic in connecting with your customers. When you share interesting content with your customers, it’s likely that they’ll share your messages with peers. This not only results in brand awareness, but it also creates a better bond between you and your customers. They like your brand because you are cool, and they like sharing cool things with their friends.
Social currency and brand loyalty
As the Vivaldi Partners study showed, social currency helps drive brand loyalty. Brands that have earned high social currency also command premium prices.
Think about Apple. By building its social currency, Apple doesn’t just lead smartphone sales by volume. It also charges a premium: it’s able to command some of the highest prices for its products.
Like word-of-mouth marketing, social currency is a means to an end. You don’t just want customers to talk about your brand; you want them (and their friends) to buy.
The dimensions of social currency
How to build social currency in a way that drives more revenue? Building social currency requires providing one of the following “dimensions,” or benefits, to an audience member:
- Affiliation: Offering a sense of community among your customers
- Conversation: Engaging in the customer conversation around your brand
- Utility: Creating usefulness and value for customers, while helping them become more socially relevant
- Advocacy: Developing strong feelings of loyalty to a brand, to the point where customers recommend and even defend it
- Information: Giving valuable and shareable information
- Identity: Providing customers with their own identity in a group
These dimensions have always played a role in your social strategies. Yet, their influence may not be focusing on other parts of the customer relationship.
Each of your social tactics should consider one or more of these brand-building dimensions. When planning your social strategy, you may ask, “How can I provide greater utility?” Or, “How can I give customers a sense of affiliation?”
Let’s return to the Apple example. Apple’s devices offer similar functionality to its competitors’ devices. Why can Apple charge more? They’ve invested in developing the following social currency dimensions:
- Utility: Apple doesn’t only deliver the functionality consumers want. It does so in a way that “just works” (well, most of the time).
- Conversation: Apple’s legendary product launches help build a conversation around its products.
- Identity: Apple fans rallied around its “Think Different” cry. Now, Apple products represent status, or having what’s perceived as the best.
Each of these dimensions helps Apple customers decide to stick with that brand. Even though your business probably doesn’t have access to a massive ad budget like Apple, you can still apply the same principles, which will grow your word-of-mouth marketing and generate more referrals.
The social currency bank account
Understanding how to build social currency makes your referral marketing strategies more effective. Imagine social currency as a bank account. If you want to spend your social currency – that is, if you want to ask something from your customers – you’ll need to have earned something first. As you know, customers who don’t have a relationship with a brand are unlikely to advocate for it to others.
Each time you provide one of the six dimensions of social currency listed above, you’re making a deposit into your social bank account. This account is what you will draw from when it’s time to ask for a referral or sale.
Every customer responds to the dimensions differently. For example, one customer usually follows the crowd, so they respond well to affiliation. Another customer might seek utility, because they’re looking for a product to solve a problem.
It doesn’t matter which tactics you use to drive potential customers through the consider, purchase, and loyalty phases of the sales cycle. You can always add the dimensions of social currency to further deepen the customer relationship.
Social currency means showing everyone what makes you better than the rest. Put yourself out there, share relevant content on social media, and talk about your best features. It’s all about how you make yourself trusted, relatable, and shareable.
You don’t have to dive right in – play it calm, cool and collected, and gradually build your relationships up. Becoming a friend of your customers by sharing things about your brand and interacting with customers helps you develop these relationships. For example, if someone tweets at you or tags you in a post on LinkedIn, reply back.
Social currency is the key to everything you have ever seen go viral on the web. Of course, not everything and everyone goes viral, but social currency does help you increase your word-of-mouth marketing.
How earning social currency benefits your business
When you’ve taken the time to earn social currency with your customers, your business benefits in several ways:
1. Greater insight into your customers
High social currency deepens the relationship between your business and your customers. You’ll have a clearer view of what your customers want, what they don’t want, and gaps in the market your brand can address. You’ll also know how customers perceive your brand, which allows you to manage your brand reputation.
2. Increased impact
Social currency helps customers find more value in your product or service, and shows the utility of your brand. This, in turn, increases their likelihood of customers becoming a brand advocate.
3. Larger circle of influence
When a brand earns enough social currency, it becomes an influencer in its niche. This, in turn, gives the brand greater leverage with other influencers.
4. Organic growth
When your social currency reaches a certain level, you experience a snowball effect – all the work you’ve done in the past will compound. You might even experience Metcalf’s Law, the phenomenon where audiences reach critical mass and your brand explodes in popularity.
5. Higher customer retention
Social currency drives the kind of loyalty that catapults you over other brands. For example, Target and Walmart offer many of the same products. But because Target has earned social currency via social channels, the brand has a higher repurchase or loyalty rate over Wal-Mart.
6. Premium prices
If you’re trying to position your brand at a premium price point, social currency can help. Social currency changes the way customers perceive a product’s value – it essentially adds something money can’t buy.
7. Better word of mouth
How will current customers respond to a brand with stronger social currency? By building a brand your customers are proud to support they’re more likely to be your front line in word-of-mouth marketing, as they promote and recommend your business to their friends.
8. Larger amounts of higher-quality leads
All the above benefits add up to this final benefit – more leads. Your customers become primed to refer their professional network to your business. This drives a steady stream of highly qualified leads, which results in helping your business grow.
Looking for the easiest way to start a referral program?
Top 10 ways to increase referrals with social currency
Want the benefits of social currency for your business? Let’s dive into some actionable strategies you can start working on today. Here are several ideas you can try today to generate social currency with your customers.
1. Tap into influencers and brand ambassadors
When an influencer or brand ambassador promotes your company, you’re borrowing their social currency, as well as using your own. After all, these representatives will only promote a brand they love and think offers value to their followers.
This reasoning is why an influencer marketing strategy or brand ambassador program is a powerful way to generate more social currency. In fact, brand ambassador programs are proven to help you grow your brand 10 times faster!
But who should you choose to represent your brand on social media? Focus on finding representatives who resonate with your audience, and whose fans respect and trust them.
Social currency dimensions used: Affiliation, conversation, advocacy
2. Create a community
One of the most successful social currency strategies is to create communities. This is especially true for your ideal customers. For example, say your business sells an organic cleaning spray. You might create a Facebook group for people to share natural home cleaning tips. By doing this, you are offering affiliation and identity to your members. You’ll also attract other people with a growing interest in organic cleaners.
Social currency dimensions used: Affiliation, advocacy, identity
3. Show what’s unique about you
What sets you apart from your competitors? Do you have a unique selling point? You should emphasize what makes you stand out, and place those values front and center in all of your marketing. This is not only a great selling point for your brand, it also helps to drive social sharing.
Social currency dimensions used: Utility, affiliation, advocacy
4. Create explainer videos
It’s every brand’s dream to generate the next viral video hit. While it’s hard to predict what will go viral, creating useful video content is a good place to start. Simple explainer (or “how-to”) videos are a great place to begin, as valuable insights or tips are highly useful to your customers and work toward building advocacy.
Social currency dimensions used: Utility, information, advocacy
5. Incentivize advocacy
With the majority of people trusting recommendations from their peers, referral programs are one of the most powerful ways to grow your business. Yet, these programs need the right incentives to be successful. Consider offering coupons, vouchers, gift cards, or other proven referral rewards. It’s also a good practice to recognize your top referrers and foster loyalty within your community.
Social currency dimensions used: Utility, advocacy, conversation, affiliation, identity
6. Launch an informational campaign
Creating a resource to share information with customers builds you up. Develop knowledge bases, online learning portals, guidebooks, and other informational resources for customers.
Social currency dimensions used: Information, conversation
7. Use gamification
Think about developing game mechanics or competition structures centered around your brand, where customers can complete challenges to earn points and achievements, progress through levels, and climb leaderboards.
Gamification can easily be applied to a loyalty program or referral program, or used to create a promotional contest that drives buzz around your brand (much more interesting than a traditional ad). The fun and value customers get out of this type of program will further motivate them to share your brand, so make sure you offer a way for them to easily share their achievements throughout the campaign.
Social currency dimensions used: Identity, affiliation, utility, advocacy
8. Create exclusivity
Offer exclusive brand “secrets” to your loyal existing customers, which aren’t known by the general public (i.e., secret menu items, members-only events, private sales). This insider info will make your customers more inclined to share with their friends, so they can all enjoy the same benefits. These friends, in turn, will also share with their friends, which gives your brand’s social currency a huge boost.
Social currency dimensions used: Utility, information
9. Optimize content for social media sharing
One of the easiest ways to boost your social currency is to create products and content optimized for social media sharing. Whether it’s a highly shareable product, an Instagrammable brand experience, a humorous Tweet, an on-trend post related to your brand, or an engaging video, these content pieces will quickly give your reputation a boost when done right. Just make sure to deliver what your audience wants, and stay true to your brand voice and tone.
Social currency dimensions used: Conversation, utility, affiliation
10. Give your customers an identity to rally around
Highlight customers within your community to help them stand out and gain a community identity. In a referral program, this may include featuring top-referring individuals and new affiliates.
Social currency dimensions used: Identity, advocacy
Whether you’re actively building it or not, the dimensions of social currency already play a role in your brand strategy. This social currency empowers your brand to deepen relationships with your customers, which can help create a more effective referral marketing strategy.
The result? Even more high-quality leads and referrals. Review your marketing strategy today to see how you can build more social currency with your audience.
Social currency examples
Do you need some examples of how social currency is put into play? We’ve rounded up four stellar examples below.
Too good to be true, I must share…
Yes, this Tweet from Starbucks is #perfect. As you can see they made a fun little countdown number (2) with hearts and coffee cups – cool visual to share, right? They created a limited time event, which creates a sense of urgency and exclusivity. You don’t want to miss out on sharing the love. Notice the number of shares and likes: Buy one, get one free (for a limited time) definitely works in fostering a lot of shares.
I want to let my friends in on the secret…
Ever had an Animal Style burger at In-N-Out? This item isn’t listed on the chain’s regular menu. Instead, Animal Style burgers (and fries) are part of the secret menu – so you had to learn about them through word-of-mouth before you could order. In-N-Out knows how to make people feel like insiders with their secrets, and drive up social currency. Regulars know that Animal Style is too good not to share, so they’re happy to pass the secret along!
So cool! I need to post about this!
Milk Train, an ice cream shop in the UK, knows how to create a totally Instagrammable experience with their “cloud” dessert – a combo of ice cream and cotton candy. It’s just one example of a social media-friendly food that was tailor-made to drive up social currency. People like @atyourshervice can’t help but post!
I know the perfect person to share this with…
Referral programs are great in that all of your customers know at least one other person who would love you. Trendy Butler gets that. See how they call it a “Friends & Family Program”? It makes it sound like you’re on their exclusive list, plus they make you feel like you’re family. Who wouldn’t want to share?
Wrapping things up
Social currency doesn’t have to be specific to one thing in your brand. Whether you use it to promote a promotional item, your referral program or just your brand in general – be creative, have fun, and show who you are and you can build up solid social currency.