Is Social Media Equivalent to the Industrial Revolution?
By Tom Ryan
A YouTube video
making its way around business and academic circles entitled “Welcome to
the Revolution” starts off by asking whether social media is simply a fad
or the “biggest shift since the Industrial Revolution.”
The video supports
the release of a book, Socialnomics: How social
media transforms the way we live and do business by
Erik Qualman, global vice president of online marketing for EF Education,
headquartered in Switzerland.
Supported by a techno-beat, the video lists a stream of facts around social media that will supposedly be substantiated and analyzed in the book. These include:
- One out of eight couples married in the U.S. last year
met via social media; - Years to reach 50 million users: radio (38 years);
TV (13 years), internet (four years), iPod (three years). Facebook
added 100 million users in less than nine months, iPod application
downloads reached 1 billion in nine months; - If Facebook were a country, it would be the fourth
largest after China, India and the U.S.; - Eighty percent of companies are using LinkedIn as
their primary tool to find employees; - Ashton Kutcher and Ellen DeGeneres have more Twitter
followers than the entire population of Ireland, Norway and Panama; - Studies show Wikipedia is more accurate than Encyclopedia
Britannica; - Seventy-eight percent of consumers trust peer recommendations,
only 14 percent trust advertisements.
The video was
played last week by Peter Sachse, chief marketing officer of Macy’s as
well as head of macys.com, at a seminar entitled, “Doing Business in the
New Normal,” sponsored by Emanuel Weintraub Associates.
Mr. Sachse joked
that his own children don’t answer e-mails or cell phones, but “if you
text them, they’ll text you back in a second. They don’t want to speak
to you.”
But he said social
media becomes more critical as peers are shown to be the most trusted sources
for information and corporations the least trusted. Social media is also
about the new way information is being distributed. The video came to his
attention from many of his peers rather than traditional sources.
He also
related a story about an earthquake that occurred in August as his wife
was taking their daughter to San Diego for her second year in college.
His wife went on Twitter, searched San Diego earthquake, and immediately
found out the exact location and magnitude of the earthquake well before CNN and
other news sources. The event caused the couple to rethink their traditional advice to their daughter of turning to TV or radio in the event of an emergency.
“We said her
that if there’s an earthquake or something bad that happens out here, go
to Twitter and search the event,” said Mr. Sachse. “The community will
tell you – not the news. Your peers are going to tell you. Social is here
to stay.”
Discussion
Questions: What do you think of the comparison of the emergence
of social media to the industrial revolution? What aspects of
the hype around social media are being over-exaggerated? Which
are dead on and which may even be underestimated?
I’m usually an old-school flat-earth curmudgeonly skeptic when it comes to whiz-bang new ideas that are discussed here, but in this case I’m drinking the Kool-Aid in big gulps. Social media are truly transformative, and we ain’t seen nothing yet. It’s going to be a very interesting ride over the next 5-10 years while we figure all this stuff out.
But having said that, it still makes sense to lead with traditional metrics and mindsets, which will help us see the incremental impact(s) of social media, and let us build a new analytical/managerial platform from a well-established base. I’m concerned by experts who say that the traditional frameworks (e.g., reach/frequency/GRPs for media measurement) are no longer relevant. The burden is on them to firmly demonstrate that this is the case. Until then, I’ll stick with the old tools to help measure and muddle my way through this new world….
Social media is indeed producing a revolution. Whether it is a revolution in production, like the industrial revolution, is yet to be seen. Social media has changed the way people communicate and digest information. It is changing the way people research and then make purchases. It has changed the way that businesses interact with consumers and put a premium on value and customer service. Retailers and manufacturers ignore it at their own peril.
All the buzz about social media is really dizzying. Is it comparable to the Industrial Revolution? Maybe. Will it last as long? Half the camp says yes, half no. Either way, it’s here now and business needs to embrace it. It’s a great way to increase your brand exposure. The best thing about it is the low or no cost to entry making it a great marketing vehicle for small business. If anything, it’s probably on a larger scope than the Industrial Revolution, just based on the sheer numbers of participants and the global scope of social media.
By one measure at least–the accumulation of wealth–the comparison is exaggerated. I just don’t see social media having the same ability to take resources, natural or virtual, and translate them into wealth for the progenitors of the technology to the same scale as people like Rockefeller and Carnegie. Sure, the founder of Facebook is worth $1 billion, and Google continues to mint money, but the other social media “barons” can be counted on one hand.
I guess that the argument is that there will be a slew of new social media “barons” in the near future and the group will be comparable to the tycoons of the late 19th and early 20th century. Again, I don’t buy this because that earlier group was very diverse in terms of the industries they transformed. While social media is transforming several lifestyle industries, I don’t see as much of an impact on the broad economy.
Put me down as a solid believer in Eric’s statements about this being a revolution. To me, the key metric is that 90% of Gen Y uses Social Media daily. These are the target customers of tomorrow. Put that together with the record drop in circulation for 24 out of 25 major newspapers, the growth of commercial-free satellite radio, and the factoid about 90% of people who can TiVo through ads, do. (I know I do.) The inescapable conclusion is that, if you are going to effectively communicate with the consumer population, it will eventually be through Social Media.
Retailers that ignore this do so at their peril.
One step at a time. Will social media lead to the Bob Garfield scenario of Chaos 2.0? Probably not. 95%+ of all video viewing minutes are still on the big box and TV advertising still works as well as ever, based on an analysis I did of 388 cases. If social media does not revolutionize media, I think it falls a little short of “industrial revolution” status. Currently, there is no question that social media is here to stay, but it is mostly bolted onto traditional brand building, except for niche-y brands like Zappos.
So significant, a must-have, and here to stay? Definitely. An opportunity that a marketer can’t ignore? Of course. Industrial revolution? Not quite.
It is not the social media revolution, it is the complete technology revolution. Social media is only one small part of it.
The scary part about the “Industrial Revolution” metaphor is that we seem to be having a revolution of some sort every month or so, depending on what the ‘app’ is. But, the real question should be, are any of these revolutions actually improving our lives? I know where the earthquake hit…so? I can find a sale faster…big deal. My daughters’ text 60 times a day…so what? They’re broke now. I can get a better girlfriend…oh, well, ok, now I get it!
I think there’s a lot of hype in some of the numbers about social media. For example, I certainly don’t believe that 1 in 8 couples who married in the US last year met via social media, that 80% of companies are using LinkedIn as their primary tool to find employees, or that Wikipedia is more accurate than the Encyclopedia Britannica.
And, unfortunately, I really can’t go to the bank on what I read in social media, either. My biggest complaint about social media and some of its promoters are that they play fast and loose with numbers and facts, and it’s hard to trace where numbers and facts came from. Where that will take us, as we increasingly rely on this information/misinformation, is anybody’s guess, but it looks like a sloppy, mediocre world where “close enough” will be acceptable.
I think people underestimate the Industrial Revolution. When social media doubles the average human lifespan, frees dozens of hours a week from backbreaking farm labor, changes where the majority of people live, etc, then it can be compared. Perhaps, maybe, the “Information Revolution” (if I can use an old-school term), with social media as one recent small part….
Social media equivalent to the Industrial Revolution? Be serious.
However, social media as part of a broader “digital era,” which is the next phase beyond the “knowledge” economy–yes.
Digitization in myriad forms–including social media–is in fact the next economic broad phase. We ain’t seen nothing yet.
An interesting thesis. But it depends partly on an excessively broad (IMO) definition of social media that encompasses pretty much all new media technologies and the applications that run on them.
It is an axiom of media ecology that newer media displace older media and that they have a structural impact on the culture. It seems to me that some of the social media identified here are behavioral complexes and techniques built upon the real revolutionary media technology platform–the Internet. There’s your next techno-cultural revolution.
To press the distinction: In the post-Gutenberg era there were numerous innovations based on the existence of the printing press, that went way beyond the publication of bibles. Ink and paper manufacturing advanced. Broadsheets, flyers and newspapers were invented. Educational systems were altered to enable widespread literacy. Democratic governments followed….
You get the point. Maybe it’s splitting hairs, but I view social media as a complex of smaller technologies and applications that leverage and extend the revolutionary impact of the Internet, just as newsprint and Linotype extended the revolutionary impact of the printing press.
In my view, the comparison between the industrial revolution and the internet revolution is a useful exercise for both social critics and media ecologists. Social media carry a profound cultural and personal impact, but I would argue that while they are stunning artifacts of the revolution, they are not the revolution itself.
Tom’s proposition in the first paragraph is of course overblown. That said, social media is big, likely growing, and very valuable. It’s all communications, so first determine 1) who your audience is 2) what you want to convey to them and 3) how you want them to react to your messages.
Social Media is just a part of the information revolution that started with the internet. I don’t think it compares to the Industrial Revolution for all the reasons stated by Jonathan. People talk about social media like they used to talk about web businesses before Y2K. If you can’t turn viewers into dollars, you don’t have a business model. Consumers have always preferred their friend’s recommendations over advertising; social media has simply made this process more efficient.
However, it is an important and significant change in how efficiently information can be shared. One that makes it much more difficult for companies to ignore their customers; we will all benefit from that.
Creativity is largely a two step process, first to sort all the input into big buckets, and then to use what you learn about the big buckets to parse them into their fragments. If that is a little hard to follow, think of it this way.
Society from the beginning has gained massive productivity by massing: the division of labor that led the bootmaker to make all the boots for the “village,” while someone else did all the blacksmithing, etc, led to a much more efficient village, with superior quality and lower prices, whether in coin or trade.
The industrial revolution was nothing more than a huge advance in massification, primarily led by standardization of production, rather than each item being custom made. So mass production, led to mass distribution, led to mass retailing (self-service,) which led to mass communication (the replacement of “selling” in self service.
The birth of mass communication 100 years ago was a harbinger of the creative deconstruction of society, which began in earnest with the fragmentation of mass media–the multiplication of channels, leaping to near infinitude with the internet. However, social media is providing the tools to allow demassification (customization of the individuals chosen listening, with some control of who will be in their personal audience.)
How this will play out may very likely overhaul the fundamental structures of society, all the way up to, and including government. I like the the idea of Facebook being the fourth largest “country.” (Walmart is up there too, and is a “partner” to the social media revolution–just a thought.) When I say overhaul government, I want to point out that for years their have been discussions of the death of the state as a concept.
Those of us following blow-by-blow politics may be watching the early stages of the crumbling of government (globally) as we know it. Just when a few are seeking further massification of control through governments and super-governments, social media is busily liquifying the solid foundations of the house.
Twenty years from now the world may be a very different place, with only geography and climate being the same. But one thing you can safely bet on is the continued creativity of the human race, with the counter currents of massification, with subsequent fragmentation and reassembly, again and again. We are not at the end–per the apocalyptics–but at the beginning! On, ON!
Count me as a deep skeptic. I jumped on the Facebook bandwagon along with all of the other 40-somethings, but I found that it made me think less of my friends after I read their inane comments, and I haven’t looked at it in months. My greatest hope is that the Gen-Y social media set will eventually grow up and start communicating the way humans have communicated for millennia: using the human voice. I hope they will also learn to use written media other than text-messaging services–something with complete sentences and fully-formed paragraphs.
My new mantra is “Twitter is for Twits,” and I have yet to find any evidence to convince me that it’s not–I like Ellen Degeneres as well as anyone (you can keep your D-list Ashton Kutcher), but I don’t really care if she and Portia are on their way to a dinner party, or if she just read the new Barbara Kingsolver novel. Social media are simply a way for people to fill the empty feelings inside, but if they really want to fill that emptiness, they’re better off using a telephone or meeting someone for a coffee. We’ve raised an entire generation with no social skills.
As for the commercial aspects of this “revolution”–given the tendency of the younger adults in our world to tune out the commercial aspects of everything, long-term, measurable success will be minimal. Sure, engage in social media if that’s the only way to reach the intended consumer, but don’t bet the farm on it.
Social media is undoing all the assumptions of one-way communications. At best, the current internet experience is a one-way experience. We can slice and dice it but at the end of the day, the most “interactive” Web site is still someone in an office somewhere coming up with their best guess as to what the consumer-user-audience wants.
Social media’s revolution is really in putting the two-way into the conversation. Aligning with, anticipating, and delighting your customers becomes a much more efficient and measurable enterprise with social media. As the technology becomes more readily available, and as X & Y and the next generations influence more and more spending each day, this revolution will start to feel like just that, a revolution.
This discussion is about a future-state of human behavior. Our behavior may change over time, but our rational and emotional drivers are not all that mysterious. Stores won’t go away and neither will the Web or social media. What will change will be who controls the purchase. And that has not really changed all that much.
Social Media is only one element to the Technology Revolution, specifically the Internet. The internet has caused the “Flattening of the World.” Meaning, we are all capable of leveraging it equally and we all have access to the same information. The world is becoming more equal. This has been going on for decades and social media is just the latest to take off. It has also been around for years. My 22 year old has had a Facebook account since 6th grade. But now these kids are graduating and leveraging the technology for work and other things. It’s not just a sneaky way to collaborate with your friends on Saturday’s party anymore.
Nothing about the social media evolution is being overestimated. It is 100% here to stay and it’s now having great impact on all generations. Even my 77 year old mother is on Facebook. It’s here to stay, it’s getting media bias out of the way and giving immediate access to information from people you trust.
I’m not sure we gain anything by validating a comparison between social media and the industrial revolution, if in fact a comparison can even be made.
Having said that, I think history will certainly regard the advent of social media as a defining shift for mankind.
The better comparison is probably between Television and Social Media. While Television opened up a whole new channel for mass promotions. Social Media is opening up a whole new channel for customized promotion directed to niche markets consisting of specific consumers. It is no longer difficult to reach all the quilters in the world.
There is, however, another comparison between the broadband internet and the industrial revolution which bears attention. Just as machinery enabled one man’s output to be vastly increased, the network allows one individual to cast a wide swath of influence. This could be by publicizing their beliefs or by writing software the impacts many users. The disintermediation of business models that is still unfolding will probably have a larger impact than the revolution of fuel efficient cars.
I agree with Mel Kleiman that this world has gone from the industrial to the technological and social media is the way we communicate, versus the land-line telephone. Social media will be here in some form or another…until someone thinks of the next revolution….
The real equivalent to the Industrial Revolution did not start with social media but rather with the advancements in telecommunications that drive an Information Revolution. It’s really an Information and Network Revolution.
Social media is a component of that certainly but SM is really an evolution of what the high speed data networks/internet and their associated means of exchanging information between multiple parties represent.
Part of the big change we’re seeing is the mass acceptance and participation in social media and the fact that it’s (by definition) less private than pure email, SMS or even posting comments on message boards, which goes back many years. The evolution includes making this participation by the masses relatively easy and mostly free though certainly not in all cases and likewise, often sponsored by advertisers.
Which is the second big change: large companies sponsoring social media and participating themselves.
What hasn’t changed, and is mentioned at the very top by Professor Fader from Wharton, is that these advertisers still need to use many of the old, tired advertising (CPM) models based on impressions. The next big evolution, at least in the marketing world, is when advertisers pay exclusively for performance in terms of sales, not exposures. That is only in its infancy and doesn’t come close to social media in terms of acceptance…or certainly not in terms of a herd mentality!
Is social media equivalent to the Industrial Revolution?
Is Ashton Kutcher more important than George Washington?
I guess if you free yourself from any kind of standard or basis for comparison you can answer “yes” to both…or anything, for that matter.
No, I do not agree it is more important the the Industrial Revolution by any means. It is very hyped but the measurement aspects of its ability to drive business is still very hard to quantify.
The fact remains that as Seth Godin said, “people want to communicate and interact with their own tribes. Small is the new big.”
Social media allows individuals to form small groups, yet there are so many experts out there who have NO idea what they are doing.
“Sheer numbers of participants” needs to be taken with a pinch of salt. After all, the population of the world is considerably bigger than during the Industrial Revolution. More to the point, I think, is the proportion of the population that is engaged in engaging via technology that offers a far wider reach than would be possible by any other means. Which doesn’t, I think, always mean that bigger (or broader) is better. Sometimes it may be, I have to concede, but sometimes it isn’t, I have to insist.
The composition of the proportion experiencing connection through one or more degrees of separation is also significant. I was interested to see the figure for growth among women aged 55-65. In my own extremely limited, anecdotal, experience this is true to only a very small degree. I was astonished, recently, to participate in a conversation with a group in this category and hear about their involvement with Facebook. Largely at the behest of their children but with widely varying responses. Most of them tried, found little or no value, and just as quickly stopped playing. I wonder if this reaction was taken into account when the figures quoted on YouTube were compiled. Speaking with my admittedly reactionary hat on, I can see as much downside and potential danger in social media (if not more) than upside and potential for positive personal, political and commercial development.
Just for good measure, look at this metric – 155,845 people have viewed the YouTube video. Make of that what you will.
Any comparison of social networking to the magnitude of the industrial revolution shows a complete lack of understanding of history. That’s not surprising as many of its participants were likely just being born, say around the first Gulf War. A large majority of the participants could likely not tell you when man first landed on the moon even though we celebrated anniversary of that just this year.
This so called ‘revolution’ has only just begun and at its current stage, the impact can’t possibly be measured against the industrial revolution. Sure it’s fast moving and rapidly changing at a pace we’ve never seen before and likely can’t comprehend. However, compared to the changes that someone born in 1900 saw in a lifetime, its impact is not even close. It’s changed the way we communicate but not the houses we live in, the way the houses are heated, the need for a barn, the need for an outhouse, the dynamics of change from a totally rural society to an urban one, the means for travel, the way we bathe…the list goes on. Certainly I can text someone from the bathtub but that didn’t change the ability to take the bath in the first place.
Monumental, maybe. Historic in terms of comparison to the industrial revolution, not even close. Because we can know what someone is doing every minute, doesn’t necessary impact their ability to do whatever it is they are doing to meet their day to day needs. The industrial revolution changed everything. When Twitter changes the way we actually do something like eat, bathe, stay warm, travel, etc, etc, etc, let me know.
I believe referring to a “social media revolution” involves some metaphorical hyperbole, however, it is one very key battleground in the overall “digital revolution,” as Jonathan Marek indicated in his comment.
During revolutions, it’s hard for people to get an accurate perspective on their influence while in the midst of the transformation. We can admire the great impact the Industrial Revolution had on society after having seen the resulting technological process on the economy and our culture more than 100 years later.
Social media, as one part of the digital revolution, does align with the production/advancement mindset. Certainly there are new jobs formed just to create, maintain and host each social media website. Companies benefit financially from positive customer recommendations made online, just as there are many consumers benefiting by finding find cost savings after having visited a social media site.
Social media is also certainly changing the timeliness and relevance of online content, as well as the reach in which you can connect and communicate with current and future customers. Given the space I participate in everyday, I know it’s transforming the traditional ways of handling customer service. With the online channel driving more recommendations today, second only to personal recommendations from friends and family, social media encourages consumerism in a form we’ve never seen before. For companies then, it’s becoming business critical to have a social media presence as it has the potential to enhance customer service and for businesses to connect with individuals on one-to-one marketing models.
While the influence of social media has yet to be entirely measured, it’s already creating a buzz among tens of millions of people around the world. It’s changing the way consumers, marketers, corporate businesses, CEOs, job seekers, PR professionals–even journalists–communicate with one another and with those in their network. Undoubtedly the social media movement, within the broader digital revolution, will continue to create global change in how we relate, communicate, and service each other.
Social media is transforming the way we communicate and the way we connect. New groups are being formed daily, content shared in real-time and even older consumers are being brought into the fold. This change will have repercussions for years to come.
The greatest implications for retailers involve the need to expand their presence into non-traditional media–for example, the owners of the retail cupcake chain, Sprinkles, markets to customers primarily via the web. The results for the cost exceed traditional media by a huge amount.
But the requirement is time and content. Consumers are well aware of frauds on social media and it does not take too long to be “outed” by the community. But interact often and genuinely and you can build 1:1 connections that are long-standing.