Last updated on April 12th, 2013 at 09:09 am
The other evening I went to a techmap event where Mark Schaefer talked about his new book Return On Influence and the key themes and trends it explores.
The book focuses on new online tools like Klout, PeerIndex and Kred that develop algorithms to measure an individual’s online social influence and explains why they are now so widely used and what this means for all of us. Although far from perfect and despite the fact that you may never be able to truly gage someone’s reputation and influence just from online data, these tools are becoming increasingly significant and brands, particularly in the US, are using them to build important relationships with key customers and reward these ‘citizen influencers’ accordingly.
The ability to use social software to easily build relationships and scale networks combined with the fact that everyone goes to the web to access and search for information, means that now what matters above all else is the ability to create and curate intelligent and valuable content and have built the necessary relationships online that enable that content to move through your network and beyond.
This phenomena, the elevation of the citizen influencer, and its critical importance to business is what has lead to tech companies like PeerIndex developing their software. Mark’s book contains the following quote from PeerIndex’s founder Azeem Azhar that nicely summarises his initial motivation and also explains why social media is now so important for an individual’s success:
“The old channels of creating influence were quite clear…and dysfunctional. In order to have impact, you needed to go to the right university…check that box…get a job with the right newspaper or investment bank…check that box…and guess what? Now you have influence.
“But actually, it’s not influence; it’s hurdle jumping. You’re jumping the hurdles of your SAT, your GRE or GMAT, or other entrance exams. You’re jumping the hurdle of the late night drink with the city editor of the local paper or investment banker who you’re hoping is going to recruit you. That was the old way to get ahead and get noticed.
“But we found some really smart people hanging around in the social space with no clear metric to distinguish who you should trust and on what subject. So that’s what PeerIndex became. That was the vision.
“We knew that within the data on the social web there were some really clear indications of people’s tendencies and behaviors, there were patterns that would indicate the topics that they really cared about and maybe even some indicators of influence on certain topics.
The impact of social media is wide ranging and will eventually go to the heart of our financial system. The concepts that Mark explores in his book tie in with the messages of Simon Dixon, a TED speaker on banking reform, who talks a lot about how online influence will eventually be key to the future of banking. Simon is passionate about ending the current financial mess and moving away from traditional banks to a more sustainable person to person financial system where an individual’s social capital and network will be key. With equity crowdfunding platforms like Crowdcube and lending marketplaces like Funding Circle becoming increasingly popular, we are already starting to see the rise of such a new system.