TAG | Newsletters
In a recent study conducted by IBM, researchers from IBM and MIT found that the average email contact was “worth” $948 in revenue. This is believed to be the first time a specific monetary value has ever been assigned to social network contact. To arrive at that number, the researchers dove into the address books and emails of 1600 IBM consultants (identities withheld, of course) and compared the communication patterns with the consultants’ performance in terms of billable hours, projects participated in, and revenue generated.
Close Ties = Improved Performance, More Money
In addition to determining the value of an email contact, the researchers also found that those who had strong email ties with a manager enjoyed greater financial success than those who kept themselves more distant. In fact, those with strong links to a manager produced an average of $588 of revenue per month over the norm.
Another value tied to greater financial success was network reach. A more diverse circle of correspondents – specifically, the number of people reachable in three steps – was also tied to higher performance.
Some Negative Impacts
However, if there were too many managers involved; projects overly-managed tended to have less success.
As for those who typically emailed the same people over and over, the results were also found to be negative. This is perhaps due to repetitive and redundant information being exchanged, the researchers theorized.
The study also identified a particular type of email user dubbed a “gatekeeper.” The gatekeeper was someone who insisted upon personally approving or enabling every request. The researchers determined that this person was a less valuable team member – monetarily that is. In other words, if you’re constantly being asked to provide information or access to others, don’t be flattered – you’re just another node on a colleague’s network and one that may very well be a bottleneck to the information flow.
What’s better is to have a handful of “superstars” on a project who are well-connected and in the center of the information flow. This actually leads to better performance than if all team members were central to the communication pathways.
Finally, the researchers found that there were a handful of things that seemingly had no impact on performance. These included access to different divisions, access to different geographical locations, and gender distribution.
The results of this study can be extrapolated only so far since the researchers used consultants to determine the monetary value of connections and the success of projects. In other industries and companies, there may be different factors that determine a project’s success or failure.
That said, there are still some over-arching truths to be found here – and these truths are relevant to the discussions we’re having on the web today. For example, just recently, there was a lot of talk about how much value there was in your Twitter network. The question was raised after Jason Calacanis offered Twitter $250,000 for placement in the “Recommended Users” section of Twitter’s site for a period of two years. His contention is that there’s a definite value to the number of followers you have on the Twitter social network and he wanted Twitter to sell him those connections for a set price. But was he offering too little or too much? Without more research, it’s hard to know.
As our social networks continue to figure more prominently in our interactions, both personal and professional, there’s likely going to be more opportunities like this to study the value of those connections. What will a Facebook friend be worth, for example? What about a LinkedIn contact? Can any study ever really tell us for sure? All we do know now is that value doesn’t come from the sheer number of connections alone, but in how you leverage those connections, how they’re laid out in your network, and how they’re interconnected, too.
For more information, you can refer to the slide deck (PPT) that summarizes this study’s findings.
ZDNET.com recently featured an article on the success of American Express’s OPEN Division . Some of the key excerpts included Jason Rudman, director of strategy and marketing for American Express OPEN who said
“Small business owners are successful by building individual relationships – for example, with customers, prospects, vendors – based on an innate ability to talk to everyone, to get to know people. You might say this is “social IQ” and that many entrepreneurs possess this in droves. You see it frequently when a small business owner engages their customers or reaches out to new ones through a very personal style of marketing. Social media as we know it today is just an extension of this in the digital universe.”
The web is undoubtedly the most useful tool to engage your customers and have an instant feedback on the success of your message. When having an e-commerce site, one of the most effective ways to engage your customers and drive sales are through dedicated email blasts. Our clients open-rate on emails have ranged between 20% – 80% . Some things to consider when sending an email blast is:
- Determine the overall goal of your email.
- Engage the user through a link, coupon code, or reply to measure the success of your message.
- Schedule the email – when’s the best time you would want to receive it?
- Make sure the email looks good.
The more you build these individual relationships and get to know your customers, the better message you can deliver; the better results you will end up having.