How To Use Social Media For Viral Marketing Of Cultural Institutions

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1 Page 1 of 16 ANZAM 2010 Viral Marketing for Arts Institutions: Challenges and Opportunities for Engaging in Web 2.0 and Social Media Dr. Andrea Hausmann Department for Cultural Management, European University Viadrina, Frankfurt (Oder), Germany hausmann@euv-frankfurt-o.de Abstract Adoption of web 2.0 applications i.e. social media such as Facebook has increased at an impressive pace since their market launch. Empirical studies show that two thirds of the people worldwide who surf the Internet use social media. Accordingly, more and more cultural suppliers seek to explore the possibilities of social media for their marketing and communication objectives. The fact that these web-based applications can stimulate and drive word-of-mouth communication among users is of special interest. However, there is still considerable uncertainty in many cultural institutions with regard to the modes of action and the potential uses of social media. Against this background, this paper aims to give important insights on how social media can be used by cultural institutions. Keywords: Not-for-Profit Marketing, Electronic Marketing, Customer Satisfaction and Loyalty, Viral Marketing, Social Media, Arts Institutions

2 ANZAM 2010 Page 2 of INTRODUCTION AND METHODOLOGY Adoption of web 2.0 applications i.e. social media such as YouTube, Facebook, Twitter or MySpace has increased at an impressive pace since their market launch. According to empirical studies (e.g. Nielsen 2009), two thirds of the people worldwide who surf the Internet use social media. The rate of growth is especially impressive in Germany, where the reluctance to publish personal information has traditionally been greater than in other countries. While only 39 percent of Germans used social media on the Internet in 2007, their number had risen to 51 percent in 2008 (Nielsen 2009). Accordingly, more and more German cultural suppliers, especially internationally renowned performing arts institutions such as Bayerische Staatsoper in Munich, the Duisburger Symphoniker or the Konzerthaus in Berlin, seek to explore the possibilities of social media for their marketing and communication objectives. In times of a general information overflow, declining credibility of traditional communication tools and a continued shortage of resources in the cultural sector, the fact that these web-based applications can stimulate and drive word-of-mouth communication among users is of special interest to cultural institutions. However, there is still considerable uncertainty in many cultural institutions with regard to the modes of action and the potential uses of social media. Against this background, this paper aims to address the following questions: What is the connection between viral marketing, web 2.0 and social media and in what way can the economics of information approach explain the importance of these phenomena for cultural institutions? What measures should be taken to exploit the benefits of web 2.0 and social media for the viral marketing efforts of cultural institutions and how important is it for such institutions to participate in these applications? To answer these questions, relevant terms will be defined, the state of research in literature will be outlined and the theoretical framework will be defined. This is followed by the presentation of possible uses of the web 2.0 and social media and an analysis of the limitations to their use in the cultural sector. The paper will be rounded off by a short conclusion and an outlook on the necessary research steps. It is based on a comprehensive analysis of the available literature on this topic. The 1

3 Page 3 of 16 ANZAM 2010 prime objective of the study is to make the phenomena of the web 2.0 and social media, in conjunction with their importance for viral marketing, the focus of research into arts marketing, where this topic has been addressed only marginally so far (e.g. Robinson 2007; Smith 2010). Because of the early stage of research no primary data was collected. Though this methodology has some limits the paper will nevertheless give some important insights in the possibilities of web 2.0 and social media for the viral marketing of arts institutions and encourage further (empirical) research in Germany and elsewhere. 2. DEFINITION OF TERMS AND LITERATURE REVIEW As the web 2.0 and social media are very recent phenomena, research in marketing is still at the early stages. While there is a large number of manuals and guidelines on this topic, these are mostly popular science. Empirical and theoretically well-founded studies into the modes of action and the potential uses for businesses and other organisations are scarce. Against this background, it is not surprising that no consistent definitions have been established for these terms; instead, available literature is characterised by a considerable degree of linguistic confusion. Research into viral marketing is at a much more advanced stage, as this issue has been sufficiently explored in general marketing literature, albeit not in specific literature on cultural institutions. Taking the above into account, the following publications were included in this study: (a) Works on viral marketing (e.g. Helm 2000; Allsop/Bassett/Hoskins 2007; Grunder 2003; Klinger 2006; Levinson 2007): Viral marketing is understood as supplier-initiated (and usually web-based) word-of-mouth for the purpose of marketing companies and their services. Word-of-mouth, also referred to as buzz marketing or referral marketing (e.g. Bayus 1985; Buttle 1989; Wilson 1991; Helm 2000; Dye 2000; Bauer/Martin/Albrecht 2007), is the informal, positive, neutral or negative communication between consumers. The attractiveness of viral communication is primarily based on its capacity for high information diffusion, as news spread on the Internet at extreme speed and the cost of this distribution is low in relation to the awareness it creates, and on its credibility, as the sender and the recipient know each other personally. When spreading news in communities and social 2

4 ANZAM 2010 Page 4 of 16 networks, it is therefore safe to assume that the word will be spread to the right target groups and that the recipients have great interest in the content (Schulz/Mau/Löffler 2008). (b) Works on the web 2.0 (e.g. O Reilly 2005; Bauer/Große-Leege/Rösger 2007; Hass/Walsh/Kilian 2008): Web 2.0 comprises technologies and applications also referred to as services or platforms in the relevant literature which all have in common that they integrate the users into the value chain of organisations and to network them. Apart from social media, which are the application and subsegment of the web 2.0 on which the present study is focused, there are other technologies such as RSS Feeds, Atom or Ajax (for more details, see e.g. Alby 2007). In conjunction with the release name 2.0 and its symbolic power, special emphasis is placed on the transformation from the passive consumer into an active (co-)producer, a prosumer although this is not entirely new (see Kotler 1986; Hyman 1986; Blättel-Mink/Hellmann 2010). Accordingly, a distinction can be made between those (mostly popular science) works that present the web 2.0 as a new, revolutionary version of the traditional Internet (i.e. web 1.0) and those that discuss the web 2.0 as the result of an ongoing development process of existing technologies, standards and applications on the Internet (e.g. O Reilly 2005; Blumauer/Pellegrini 2006; Maaß/Pietsch 2007). The latter view is shared by this paper. (c) Works on social media (e.g. Meerman Scott 2010; Kaplan/Haenlein 2010): Social media, also referred to as social software (e.g. Hippner 2006; Mikloweit 2007), are understood to be applications and platforms of the web 2.0 that enable and support the communication, interaction and the creation of relationships between users. Typical social media instruments in Germany that are currently characterised by especially high growth rates (ARD/ZDF 2009) include Wikis (e.g. Wikipedia), video portals (e.g. Youtube.com), private networks (e.g. Facebook), photo collections (e.g. MySpace) and, to a somewhat lesser degree, professional networks (e.g. XING), weblogs (blogs) and microblogs (e.g. Twitter) and bookmark collections (e.g. Mister Wong). In summary, the first research question can be answered by saying that social media are one of several web 2.0 applications that may be used to initiate viral marketing in the cultural sector and to transmit the resulting effects to theatres, operas and other cultural institutions. Several empirical studies (e.g. 3

5 Page 5 of 16 ANZAM 2010 Helm 1997; Hausmann 2001) have shown that word-of-mouth is a very important and relatively inexpensive instrument for the cultural sector. This importance is not least due to the fact that cultural institutions usually offer intangible services or services with a high degree of immateriality (Colbert 2007; Kotler et al. 2008), which leads to quality and behavioural uncertainty among users of these services (Müller 2007; Helm/Kuhl 2007; Blömeke/Braun/Clement 2008). As uncertainty is usually analysed taking the findings of the economics of information approach (e.g. Akerlof 1970; Nelson 1970; Arrow 1984; Stiglitz 2000) into account, this theory will be used here to analyse the importance of viral marketing for cultural institutions. The economics of information approach is a branch of microeconomic theory that is also used by marketers to analyze how uncertainty and information asymmetries affect consumer behaviour and marketing decisions (e.g. Helm 2000b; Voeth et al. 2005; Blömeke 2008). 3. THEORETICAL FRAMEWORK The economics of information perspective distinguishes between search, experience and trust characteristics in services (Nelson 1970; Darby/Karni 1973; Adler 1996). According to this typology of characteristics, cultural services have a relatively high share of experience and trust characteristics and a lower share of search characteristics, as the quality of cultural services can hardly be assessed by potential users in advance but only if at all retrospectively (e.g. Helm/Kuhl 2008; Müller 2008; Blömeke/Braun/Clement 2008; Kilian/Walsh/Zenz 2008). The experience characteristics of cultural services include, for instance, the signage of exhibits in exhibitions, the acoustics of a concert hall or the comprehensibility of the introduction to a theatre performance. In some cases however, not even an ex-post assessment of cultural services is (fully) possible. Instead, visitors have to rely on the promised properties (e.g. authenticity of exhibits, faithfulness to the original in concerts, educational experiences in general) to actually exist. It is safe to assume that these trust characteristics of cultural services lead to high quality and/or behavioural uncertainty on the part of the visitor before and after their use. 4

6 ANZAM 2010 Page 6 of 16 From the point of view of the cultural institution, it makes sense to take signalling measures (Adler 1996) and to transmit appropriate information to reduce this uncertainty. Signals replace or group a number of individual pieces of information which the prospective visitor would otherwise use to assess the quality. These information chunks stand as indicators for other information and thus make it easer to spread information. The price of a service or the reputation (and hence the trustworthiness) of a cultural institution or expert verdicts (mainly from critics) can be such information chunks, for instance. Also, where experience and trust characteristics are in place, recommendations among users of cultural services are considered particularly effective (e.g. Diller 1995; Helm/Kuhl 2008; Kilian/Walsh/Zenz 2008): In this context, the above-mentioned credibility and trustworthiness of the sender of the recommendation, the homogeneity and similarity between the sender and the recipient, the possibility for the recipient to get feedback and ask questions, the absence of (financial) selling interests on the part of the sender and the social control of the exchange situation play a highly critical role (Helm 2000b). Against this background, viral marketing, i.e. the (primarily) Internet-based form of traditional word-of-mouth, may be regarded as a suitable instrument to reduce uncertainties about quality as well as behavioural uncertainties on the part of users of cultural services. Unlike traditional word-of-mouth communication, which happens offline and whose reach is limited by nature, viral marketing can spread like a biological virus or like an epidemic (Kotler/Armstrong 2006) with the help of web-based technologies and in social networks, where some members have hundreds of socalled friends unfolding even greater communication effects. So what measures should cultural institutions take to use social media to initiate viral marketing? Following the definition of the theoretical framework, this will be explored in the next section. 4. USING SOCIAL MEDIA FOR THE VIRAL MARKETING OF CULTURAL INSTITUTIONS 4.1 PRECONDITIONS AND USER TYPOLOGY Users of cultural services are usually ready to recommend cultural institutions and their services to others - i.e. to spread positive word-of-mouth - when their actual experience was in line with their previous subjective expectations or even exceeded them. According to relevant literature, visitor 5

7 Page 7 of 16 ANZAM 2010 satisfaction is therefore the most important precondition for recommendations to others (e.g. Helm/Kuhl 2008; Günter/Hausmann 2009). As this applies also in times of the web 2.0, every viral marketing campaign requires the commitment of the cultural institution to aligning its services, especially what is referred to as additional or secondary services (e.g. Zeithaml et al. 2008; Lovelock/Wirtz 2010), with the needs, knowledge and other susceptibilities of the visitors ( visitor orientation ) to enable an experience that meets (or better exceeds) their expectations ( visitor satisfaction ). This means that the initiation of viral marketing and the use of social media are not an end in itself but are closely related to real world conditions. The same applies to the integration of social media into the general, offline marketing activities of a cultural institution. All measures for the initiation of viral marketing must be in accordance with other marketing instruments and require a similar approach to that known in the traditional cultural marketing concept (Klein 2005; Colbert 2007; Günter/Hausmann 2009). Decisions, especially regarding objectives and target groups, appropriate distribution channels for the messages and the final evaluation of the measures (Smith/Taylor 2004; Blyth 2006), must be taken at an early stage to fully exploit the potential effects. Thus, even in times of the web 2.0, cultural institutions are challenged to combine creative value adding processes with strategic-conceptual marketing strategies. As outlined in the third section, the most important aim of the viral marketing of cultural institutions is to reduce uncertainties about quality as well as behavioural uncertainties on the part of users. Potential additional goals include increasing the visibility and building the image of a cultural institution, attracting visitors and gaining visitor information, e.g. to conduct audience research (Renker 2008). With regard to the target groups of social media-based viral campaigns, it should be noted that the users of social media are usually not identical with the users of (public) cultural institutions. The typical web 2.0 user in Germany is young (14-29 years) and male (Renker 2008; ARD/ZDF 2009), whereas the typical visitor of (public) cultural institutions in Germany is aged 50+ and female (Günter/Hausmann 2001). This divergence entails two consequences: First, cultural institutions can use social media to reach their aim of attracting younger target groups; this requires a detailed analysis of the characteristic features of this segment, though. Second, traditional measures 6

8 ANZAM 2010 Page 8 of 16 for word-of-mouth advertising (e.g. membership referral programmes) must (continue to) be used in addition to social media to retain older people in the referral marketing process. In conjunction with the typology of web 2.0 users, the literature distinguishes between active and passive user behaviour. While passive users primarily regard web 2.0 applications as sources of information and check them for relevant messages, active users use the relevant platforms to act, communicate, network and possibly even create their own content. Cultural institutions therefore need to understand that web 2.0 users represent a heterogeneous target group (Renker 2008; Maurer/Alpar/Noll 2008), which calls for different viral marketing strategies. While frictionless viral marketing requires no or only a limited degree of user participation, e.g. the Tell a friend button on MySpace or the Like button on Facebook, active viral marketing requires users to actively participate in passing on contents on the web. This active referral behaviour can be additionally stimulated with the help of incentives (in the cultural sector for instance by offering free tickets or discounts) (Bauer/Martin/Albrecht 2007; Renker 2008). 4.2 INSTRUMENTS So what social media instruments are especially suited for cultural institutions to initiate viral marketing and distribute messages about the cultural institutions as a whole or its services? On the following pages, virtual communities and weblogs will be presented, i.e. those instruments that are broadly discussed in the literature and primarily used by cultural institutions in practice. (a) Virtual communities: A distinction is made between special interest communities, i.e. video and photo portals (e.g. YouTube or MySpace) and social networking sites, which either have a private focus (e.g. Facebook) or a professional focus (e.g. XING). Virtual communities are especially suited for cultural institutions to create viral effects. Apart from the fact that countless users are networked in these communities and that the sender and the recipient of messages can generally be assumed to share the same interests, these platforms additionally provide a (relatively inexpensive) possibility for visualising otherwise intangible services of cultural institutions. In particular, short videos or online clips can be used to materialise the intangible acoustic and/or visual cultural experience and to 7

9 Page 9 of 16 ANZAM 2010 emotionally activate the user before actually using a cultural service and to support their decision in favour of a real visit. In Germany, this potential is currently being exploited primarily by performing arts institutions such as the Bayerische Staatsoper in Munich ( which has almost 2,500 friends or supporters on Facebook (of course, this is relatively little compared to the almost friends of the Metropolitan Opera in New York and illustrates that German cultural institutions are one step behind and have to catch up) and uses the available options like video podcasts, images and stories to initiate comprehensive measures to encourage viral communication. Another example is Staatsoper Unter den Linden in Berlin, whose friends have recruited participants aged 30 and below for the 2009 Opera Weekend by directly addressing opera-loving groups on one of Germany s best-known student portals (StudiVZ). The German cultural capital, Ruhr.2010, uses social networking sites such as XING to spread information on current projects in the respective topic-specific groups and to encourage users to communicate with each other (Greger 2009). (b) Weblogs: A weblog (blog) is a regularly updated website on which contributions are published in chronological orders. The primary objective is the topic-specific information and communication between the blogger and the readers. In the German cultural sector, there are both private weblogs such as the Kulturmanagement Blog ( and corporate weblogs, e.g. by the Duisburger Philharmoniker ( or the Deutsches Museum in Munich ( Private blogs are the ideal breeding ground for viral communication, as their comment function and the possibility to link individual blogs make them especially well suited to encouraging the exchange of experience and knowledge about individual providers and their services. It seems as if (at least German) museums, which have a general tendency towards long texts, currently make more active use of this social media instrument compared to social networks like Facebook, whose use requires greater multimediality and interactivity. 4.3 SUCCESS MEASUREMENT 8

10 ANZAM 2010 Page 10 of 16 Following the description of suitable instruments, possible starting points for measuring success will now briefly be addressed. This is above all about the achievements of objectives and the effect of viral marketing by means of social media. The Internet generally affords easy access to quantifiable parameters such as visits, page impressions, downloads or clicks. However, these figures do not allow to draw any direct conclusion as to the actual effectiveness of viral measures, which means that their usefulness is limited (e.g. the number of visits does not tell anything about the perceived quality of a weblog). In addition, a qualitative analysis is possible in conjunction with social media, e.g. by checking, grouping and evaluating comments (e.g. Renker 2008; Kilian/Walsh/Zenz 2008). It should be noted, however, that users of corporate blogs, in particular, usually leave only few comments, which means that the results are not representative. Moreover, many comments are very brief or not consistently related to the topic (a problem that cultural institutions should know only too well from the guestbooks or visitor books displayed in their foyers). 5. LIMITATIONS TO THE USE OF SOCIAL MEDIA FOR VIRAL CULTURAL MARKETING Apart from the difficulties in the evaluation of measures outlined above, there are further limitations to the use of social media for the viral marketing activities of cultural institutions: (a) Shortage of resources: In international comparison, German cultural institutions are heavily reliant on government funding. At present more and more institutions are forced to cut their spending dramatically as a result of the global economic crisis and its effects on government budgets. While the use of social media basically requires only a laptop computer and Internet access and is therefore relatively inexpensive, it also ties up human resources, e.g. because of the need to constantly maintain and update the content. Given that many cultural institutions in Germany already have only limited staff (and most of them usually working on several projects), the use of social media can lead to an over-utilisation of the available (human) resources. (b) Cost-benefit ratio: Smaller cultural institutions, in particular, are unable to hire additional staff to implement new projects such as social media. In many cases, they therefore use their existing employees - many of whom are not sufficiently qualified to perform such additional tasks. If further 9

11 Page 11 of 16 ANZAM 2010 training measures are required, (directly attributable) costs for training courses, seminars, etc. and the respective safety programmes will be incurred in addition to the opportunity costs of the staff deployment for social media mentioned under (a) above, which are possibly not easy to quantify. While this means that at least part of the costs can be easily quantified, the benefit is much more difficult to specify, as it is not possible to directly measure the actual viral effects and, hence, the effectiveness of social media (Godes/Mayzlin 2004). This means that a general problem of communication policy (Bruhn 2005) also applies to the web 2.0, namely the difficulty to determine the cost-benefit ratio. (c) The structures of cultural institutions: Whereas social media are characterised by up-to-dateness, spontaneity and interactivity, most (public-sector) cultural institutions in Germany are marked by relatively strict hierarchies (e.g. Börner 2002; Klein 2009); strict communication lines and lengthy decision-making processes are typical features of the preferred top-down hierarchy. Against this background, the effectiveness of social media for the initiation of viral marketing will be limited whenever the existing communication and decision-making lines are not aligned with the new requirements. Finally, it should be noted that there are not only limitations to the use of social media but even risks for the cultural institution. On the one hand, the technologies (Ajax) used by social media and the existing security gaps mean that viruses may enter a cultural institution s system, where they may access data, take over accounts or install malicious codes. Moreover, the Internet has an extremely good memory, which may have an especially adverse impact in the event of negative or (wilfully) damaging comments that may be impossible to prevent and maybe even impossible to remove. 6. CONCLUSION AND IMPLICATIONS FOR FURTHER RESEARCH In terms of the bottom line, the following can be said with regard to the research questions asked at the beginning: The web 2.0 enables and facilitates viral marketing. Social media, especially virtual communities and weblogs, are one of the most important applications also for the cultural sector. Taking the findings of the economics of information approach into account, these instruments help 10

12 ANZAM 2010 Page 12 of 16 cultural institutions reduce uncertainty about quality as well as behavioural uncertainty on the part of (potential) visitors. It has become clear, however, that participation in social media requires certain preconditions and cannot generally be recommended to all cultural institutions. While it is undisputed that the use of social media has potentially positive effects on referral activity and the access to (primarily young) target groups, there are clear limitations to their use, especially for smaller cultural institutions. Given, however, that the developments of the web 2.0 are irreversible and will have a strong impact on the information and communication behaviour of (future) visitors, it is indispensable even for these institutions to participate in them. Constant monitoring of the further progress of web 2.0 applications is therefore recommendable. This is an initial description of the importance of viral marketing using social media in Germany. In a next step, empirical studies should be conducted on the basis of case studies to explore which measures have already been implemented on what scale by cultural institutions. In this context, it would be interesting to find out whether performing arts institutions focus on other measures than fine arts institutions. Apart from such a more provider-oriented examination, it would be important to analyse what types of users make use of the social media offerings of cultural institutions to what extent - including, but not limited to, the use of referrals. Finally, it would be interesting to compare the situation in Germany with neighbouring countries (e.g. France). References Alby T (2007) Web 2.0. Konzepte, Anwendungen, Technologien (2nd edn), Hanser, München. Allsop D, Bassett B and Hoskins J (2007) Word of Mouth Research Principles and Applications, Journal of Advertising Research, 47, 4, pp Akerlof G A (1970) The Market for Lemons : Quality Uncertainty and the Market Mechanism. Quarterly Journal of Economics, Vol. 84, pp ARD/ZDF (2009) ARD/ZDF-Onlinestudie 2009, available at (June 2010). 11

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