What is Social Currency? Definition, Benefits, and Examples - Deepstash

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Defining Social Currency

Social currency is one way of seeing the value businesses add to customers. Knowing how to build social currency allows brands to drive higher customer loyalty and add to social proof. This leads to more sales and referrals.

It is your influence on social networks, online and offline communities, and the degree to which your business is shared by others. It is the ability of brands to fit into how consumers manage their social lives in today’s digital and mobile age.

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Social Currency of Individuals

People share what they think makes them look good. In other words, they’ll only share what they believe will maintain or boost their reputation in the eyes of their peers.

Whenever a person chooses to share information, they place their reputation on the line and “spend” social currency. They don’t want to share boring, irrelevant, or misleading information because they risk losing status among their peers.

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Social Currency of Brands

All brands need social currency. It makes connecting with customers easier. And when you share interesting content with your audience, having social currency means that message will more likely be shared with others.

When someone shares your brand, they spend their social currency on you. And if others like what they see, then the social currency of both the sharer and your brand increases.

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Social Currency and Brand Loyalty

Brands with high social currency are also able to command premium prices.

Think about Apple. By building its social currency, the company doesn’t just lead smartphone sales by volume. It also commands a premium. Apple is able to charge some of the highest prices for its products, without any dip in its brand loyalty. The majority of Apple customers are loyal to the brand, and are always awaiting the company’s next release.

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The Dimensions of Social Currency

Building social currency entails providing at least one of the following dimensions (or benefits) to your audience:

  • Affiliation: Offering a sense of community among your customers
  • Conversation: Engaging in the conversation around your brand
  • Utility: Creating value for customers, while helping them become more socially relevant
  • Advocacy: Developing strong brand loyalty, to the point where customers will recommend (and even defend) a brand
  • Information: Giving valuable and shareable information
  • Identity: Providing customers with their own identity in a group

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The Social Currency Created By Apple

Apple makes products like companies, feature-wise. They are more successful because they invest in social currency.

  • Utility: Apple doesn’t only deliver the functionality consumers want. It does so in a way that is easy and seamless for consumers.
  • Conversation: Apple is known for its legendary product launches and events. At any time of the year, there’s a lot of conversation generated around its products.
  • Identity: Apple fans rallied around its “Think Different” cry. These days, Apple products represent a certain status or premium.

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Building Social Currency

Building your social currency can also make your referral marketing strategies more effective. Think of social currency as a bank account. If you want to spend your social currency – that is, if you want customers to do something – you have to earn it first.

If a customer doesn’t see a brand as having social capital (or doesn’t have an existing relationship with them), they are unlikely to advocate it to others.

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Adding To Your Social Capital

What are ways you can add to your social capital? Be present on social media, share relevant content, and highlight your best features.

You don’t have to do everything at once – you can gradually build your customer relationships. Start by being a friend to your customers. Post helpful information about your brand and answer any concerns. And if someone shares a tweet about your product or tags you in a photo, be sure to respond with thanks.

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Benefits of Social Currency: Greater Insight Into Your Customers

Positive social capital deepens the relationship between your business and your customers. You’ll have a clearer view of what your customers want, what they don’t want, and any gaps in the market you can address.

You’ll also see how customers perceive your brand, which allows you to manage your brand reputation.

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Benefits of Social Currency: Increased Impact

Social currency helps increase the market value of your brand. When a consumer sees others also enjoying your products and services, they’ll be likely to trust and try what you have to offer.

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Benefits of Social Currency: A Larger Circle Of Influence

When a brand earns enough social currency, it becomes an influencer in its industry. It solidifies its position and gains even more leverage with other influencers.

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Benefits of Social Currency: Organic Growth

When your social capital reaches a certain level, you experience a snowball effect – all the work you’ve done in the past will compound. Customers are already motivated to share the product or service with others. And if this happens through time at scale, you can expect a boom in customers and advocates for your brand.

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Benefits of Social Currency: Higher Customer Retention

Social currency drives the kind of loyalty that catapults you over other brands.

For example, Target and Walmart offer many of the same products. But because Target has earned social capital through its social channels, the brand has a higher repurchase or loyalty rate over Wal-Mart.

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Benefits of Social Currency: Premium Prices

If you’re trying to position your brand at a premium price point, social currency is a big help. Social currency changes the way customers perceive the value of a product, by adding something money can’t buy.

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Benefits of Social Currency: Better Word Of Mouth

Building a brand your customers are proud to support not only increases social currency, it will also boost your word-of-mouth marketing. Brands with high social capital are more likely to be promoted and recommended by your existing customers.

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Benefits of Social Currency: Higher Quality Leads

All the above benefits add up to this final point – more leads. By now, your customers are primed to refer their friends and family to your business. This drives a steady stream of highly qualified leads, which results in exponential business growth.

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Increase Referrals: Find Influencers and Brand Ambassadors

When an influencer or brand ambassador promotes your company, you’re borrowing their social currency. After all, these individuals will only promote a brand they love and think offers value to their followers. Focus on finding representatives who resonate with your audience, and whose fans respect and trust them.

Influencer marketing and brand ambassador programs are one of the most effective ways to generate more social currency. Brand ambassador programs have also proven to help you grow your brand 10 times faster.

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Increase Referrals: Create Communities

One of the most successful social currency strategies is to create communities. This is especially true for your target customers. For example, say your business sells an organic cleaning spray. You might create a Facebook group for people to share natural home cleaning tips. By doing this, you’re offering affiliation and identity to your members. You’re also attracting others with a growing interest in organic cleaners.

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Increase Referrals: Show Your Uniqueness

What sets you apart from your competitors? Do you have a unique selling point? Find what makes you stand out and highlight those features in all of your marketing efforts. This is not only a great selling tactic for your brand, it also helps to drive social capital and sharing.

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Increase Referrals: Create Explainer Videos

It’s every brand’s dream to have the next viral video hit. While it’s hard to predict what will go viral, creating useful video content is a good place to start. A simple explainer or how-to video is always helpful for consumers. As long as you focus on valuable insights or tips, you can be sure your customers will be watching.

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Increase Referrals: Incentivise Your Patrons

The majority of people trust recommendations from their peers, which makes referral programs one of the most effective ways to grow your business. However, referral programs need the right incentives to work.

Consider offering coupons, vouchers, gift cards, or other proven referral rewards for your advocates. You can also give a shout out to your top referrers within your community.

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Increase Referrals: Launch A Campaign

It’s always helpful to share key information with your customers. Developing knowledge bases, online learning portals, guidebooks, and other informational resources is a strong way to build your social capital.

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Increase Referrals: Gamification

Consider adding game mechanics or competition structures in your marketing efforts. For example, you can invite customers to complete challenges, progress through levels, and earn points.

Gamification can easily be applied to a loyalty program or referral program. It can also be used in a promotional contest to create buzz around your brand (much more interesting than a traditional ad).

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Increase Referrals: Create a Sense of Exclusivity

Share exclusive brand “secrets” with your most loyal customers – things that aren’t known by the general public. This can be a secret menu item, a members-only event, or a private sale.

No matter what the secret is, the offer of exclusive info raises your social capital among your select customers. This drives them to talk about your brand with their friends so they can all enjoy the same benefits. These friends, in turn, will also share with their friends, which gives your brand’s social currency a huge boost.

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Increase Referrals: Social Media Sharing Of Optimized Content

One of the easiest ways to boost your social currency is to create products and content optimized for social media sharing.

Whether it’s a highly shareable product, an Instagrammable brand experience, a humorous Tweet, an on-trend brand video, this content can quickly boost your social capital. Just make sure to deliver what your audience wants, and stay true to your brand voice and tone.

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Increase Referrals: Feature Your Customers

Featuring your best customers is a great way to show them you appreciate their efforts, and helps form key identities within your community. In a referral program, for example, this may include highlighting your top-referring customers and new referrals.

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CURATED BY

sheilaja

Product designer

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