CEOs Afraid of Going Social are Doing Shareholders a Massive Disservice
If you haven’t heard by now, Domo and CEO.com just released a mind-blowing study that found the vast majority of Fortune 500 CEOs are virtually invisible on social media sites. They’re not on Facebook, not on Twitter, not on Google Plus, not on Pinterest—they’re barely even on LinkedIn.
That’s just crazy to me on so many levels. More than half the U.S. population has eagerly embraced sites like Facebook and more than a third are using Twitter, yet only 7.6 percent of Fortune 500 CEOs have bothered to jump on Facebook, and just 4 percent have opened Twitter accounts. All in, 70 percent of Fortune 500 CEOs have no presence at all on social networks.
When we did the research for the F500 Social CEO Index, it was shocking to me that only nine CEOs in a 100-day period had tweeted. And that Meg Whitman was active only when she was running for office — but what about her 100,000 employees and millions upon millions of customers?
The fact that there were only two CEOs with more than 500 friends is almost laughable. Top it all off with the finding that Rupert Murdoch is one of the most social — he’s almost the oldest guy out there. C’mon folks!
Why is this shocking?
Social media isn’t a passing fad. The primary reason you have to be social is because that is where your customer lives. Even if you are not leveraging it to close business and interact with your customers, you have to spend enough time online to at least understand the shift in the world. This lack of engagement would be similar to 50% of the world using email with F500 CEOs holding out; or 50% of your customers shopping online but no CEOs trying it.
There’s no denying that sites like Facebook, Twitter and LinkedIn are now part of the daily fabric of life. CEOs have a responsibility to their shareholders to be visible. CEOs who shun social media risk losing touch with some of their most lucrative customers, prospects and influencers. I’m just saying it is time to jump on.
Granted, I’m not the CEO of a massive company but I started and ran a software business called Omniture that was close to a half billion dollars in revenue, sold it to Adobe for $1.8 billion, and then I served on the executive team for Adobe, which is an impressively large company.
Now, I’m the founder and CEO of Domo. We don’t have the size and scale of a large multinational — at least not yet. We are aiming to give executives dashboard-like tools to view and manage all aspects of their businesses. We don’t have the size and scale of a large multinational—at least not yet. But we’ve seen benefits since I’ve started using Twitter, Facebook and LinkedIn. We’ve attracted recruits, drummed up enthusiasm for our brand and garnered some immediate feedback from prospects on our product. Our organization has flattened and we are moving more quickly.
One day I tweeted about a product feature that I liked. Two weeks later in a meeting with engineering, I was shown our product with that particular feature built in. We never had a meeting to discuss it. I never sent a memo. The engineer took the cue and figured out how to make the product better. That was pretty amazing.
Social media has also allowed us to have more direct relationships with customers and is helping us re-imagine the way we serve customers and prospects. One day, I received a Twitter message from the CEO of a rather large company. He said he was interested in our product, had filled out a form on our website, but hadn’t heard from anyone on our team yet. I called our VP of Sales to find out why we weren’t all over this one. As it turned out, the CEO had filled out a form only two hours earlier…on a Saturday! Naturally, we followed up with him right away — but it made me acutely aware how social really changes everything.
What gets in the way of getting on board? Social takes significant time and commitment, plus it’s an entirely new way of engaging with the world. But this argument strikes me as particularly odd because CEOs have people who can help filter the tweets and Facebook messages just like they filter their email and voicemail messages. Getting on board with social is infinitely manageable. Yeah, it can be intimidating and potentially problematic as it opens up all kinds of cans of worms, and I’ve talked to many fellow CEOs who have a hard time doing business on any terms other than the ones they’ve been operating by for years. But guess what? The world has changed and there’s no hiding anymore. Old school management practices have gone out the window. If you’re not speaking for yourself, other people will speak for you. And you may not like what they have to say.
Also, since employees have more social savvy, so must company leaders. Consider the results of a recent BRANDfog survey: employees feel that companies with CEOs who use social media are much better positioned for success. In addition to enhancing the brand, employees believe that social CEOs help the company on most every front including recruiting, trustworthiness and sales.
At Domo, we’ve launched an exciting project called the #domosocial experiment designed to get all employees engaged in and learning from the newest consumer and social technologies. We’ve even made social media usage a condition of employment.
I believe that giving people throughout our company social media experiences will enable us to develop higher-quality products, understand the viral nature of web offerings more effectively, better promote the Domo brand, and foster more interesting customer conversations. And, as CEO, I can’t ask for much more than that. I’ve also heard from employees that this experiment has made them feel more connected with each other, which has been an unexpected bonus.
While Domo’s size might make it easier for me as the CEO to get on board with social, Fortune 500 CEOs have much more risk by NOT embracing these channels, and they are making it easier for others to out-innovate them or take over their brand.
The point is that CEOs need to champion innovation wherever it exists. Social media is just one form of innovation, and you can be sure there is much more coming down the pike.
It is my hope that Fortune 500 CEOs come to believe in the transformative power of social media. But if they persist in lagging far behind the general population in social media participation and not delivering value to the shareholders that is there for the taking, they may not be CEOs for much longer.
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