All Currency is Social. So what's in YOUR wallet?

I was looking up the definition of currency on Wikipedia, when I came across this line: "modern currency...is intrinsically worthless".  I'm no economist, but the info there indicated that the dollar, euro and other currencies have no value beyond the government declaring them to have value, and markets effectively betting on their future value.

So it's kind of funny that there is a distinction between hard currency (cash) and social currency (as in "net promoter value", WOM recco, blog readership or twitter followers, etc.).  Because both are effectively social constructs (for the cash, at least, since the 'Nixon Shock' ended convertibility of US dollars for gold).

But faith in institutions, like faith in people, can be fragile. 

What the hell does that have to do with marketing?

Well...

I'll go out on a limb here.  The era of the one stop shop, or agency network, or do it alone communications company - or brand, for that matter, is dead.

No brand is an island.  No agency a one-stop shop.

Brands ask for multi-year communications plans in 2010, when in 22 months between February 2005 and November 2006, YouTube went from startup to $1.65 Billion Google acquisition.  One thing you can count on is guessing wrong on the right tactics to employ in three years' time. Many of them simply don't exist yet.

So here's where the currency/social currency comes in:

Agency and brand "currency" will be a reflection of their social portfolio strategy. 

The most successful brands and agencies will be driven by a net value comprised of actual sales of goods and services + the "stored value" of their social currency (in the form of their networks of collaborators).

The key will be how quickly and effectively they can convert stored value to real value, by unlocking the power of their collaborators to achieve mutual goals. 

DARPA's "Network Challenge" was just such a test to see test the value of networks in real world problem solving.  An MIT team used a tech-fueled "inverse pyramid" scheme to solve in nine hours a problem DARPA assumed would take significantly longer.

The trick is identifyng mutual goals.  Creating a shared vision - and shared risk.  Opportunity - and accountability.

As an agency, it's a good idea to treat partners well, and treat everyone you meet as a future collaborator.  If entire alliances are forming because you are ridiculously awful to work with, you have a serious problem.

And collaboration prevents legacy investments (or entire company acquisitions) from dictating your solutions - a dev shop full of C sharpies not so useful for your Ruby project.  A search shop with an a state-of-the-art proprietary tool yields decreasing returns once that tool gets dumped onto an overall dev list across an agency holding company.  Flash devs on iPhone/iPad?  waaa waaaa.  Or in our case, it helped to have access to the right folks when we wanted to build a robot.

Victor & Spoils promised crowdsourcing as a creative model.  Meh.  What they have done is built a seriously impressive network of freelancers.  The danger is that that network is built on unstable bonds -  bonds that consist of the promise of hard currency.  Hard currency buys you loyalty with an expiration date (the better offer). 

And while money can't buy you love, earned social currency just might.

The agencies and brands that win will build networks of shared inspiration and mutual goals.  Bonds of social currency.

Because an inspired network, a network built on passion and trust, not submission forms and "friend requests", has the power to move mountains.

Comments

[Lara Jane]

Unfortunately there is not much in my wallet in terms of cold hard cash - seems seven years traveling saw the end of that, not that I'm complaining.

You make some interesting / thought provoking points here - thanks for a great article.
Lara

[anonymous]

"social currency"

I thought that was the reason people went to prestigious colleges: networking to generate social currency. Why is this new?

although i agree that the one stop shop is dead... at least for this particular cycle. call me in 3 years.