Of all the social media platforms, Twitter is the one that puzzles marketers the most. The typical observation is that they don’t get it and can’t figure out why it’s important.

EMarketer shared some research recently from ExactTarget that provides an easy answer: Twitter gives you a way to reach people who have loud and active voices online. Once you’ve gotten their attention around your message, you’ve got a good chance that they will redistribute that message somewhere on the web.

How’s that work? ExactTarget shows that the 26 million monthly users of Twitter are three to five times more likely to comment on blogs, post to forums, participate in view sites and blog themselves than the average Internet user.

“Consumers active on Twitter are clearly the most influential online,” said Morgan Stewart, principal at ExactTarget’s research and education group, in a statement. “What happens on Twitter doesn’t stay on Twitter. While the number of active Twitter users is less than Facebook or email, the concentration of highly engaged and influential content creators is unrivaled—it’s become the gathering place for content creators whose influence spills over into every other corner of the internet.”

The conclusions suggest that the time spent investing in an audience on Twitter is likely to have an exponential impact. This is the crux of social media marketing, and provides a simple justification for using a service that at first seems fragmented and chaotic.

I’ve been intrigued by the dynamic of building lead volume in our Apartment Finder business over the past year.

As I’ve discussed before, the multi-family marketing business is a competitive, lead-generating business that is driven by consumer’s accessing print and online directories and inquiring about apartments for rent.

There are three ways that marketing companies like Apartment Finder hand customer leads over to its clients:  a phone call directly to the apartment community; an e-mail to an apartment community, either directly or through a leasing intermediary; a click-thru to the apartment community web site; and, a prospect who walks directly into the community leasing office without making prior contact.

This week, one of our biggest competitors in the space shared a few public metric related to their lead production.  According to their recent earnings release, the company increased leads 35% year-over-year, and currently produces more than 75% of their leads from their Internet and mobile platforms.

That made me curious.  How did our metrics at Apartment Finder measure up?

The chart to the right shows the increase in lead production at Apartment Finder over the past year.  Overall, leads gained 43%.  Phone leads were up 25%, e-mail leads were up 169% and click-thru’s to property web sites were up 71%.

This data is derived from two third-party sources:  CallSource, which manages our tracking number program, and Omniture, which provides us with web analytics.

Most interesting to me was the distribution between leads from print distribution and from internet and mobile distribution.

At Apartment Finder, 53% of our leads, including click-thru’s, are driven by our Internet distribution and 47% by print.  Subtract click-thru’s, which can’t be tracked back to a specific individual, and the ratio drops closer to 50-50.

But the key issue isn’t what source the lead comes from.  The issue is how useful the lead is.

I had an engaging conversation around the relative quality of leads with a leading apartment marketer at the National Apartment Association Conference this past June.  E-mails that are generated as a by-product of creating an appointment to see an apartment had a high conversion, he said.  Phone calls to the community were the second best kind of lead.  And e-mail inquiries were the lowest-converting type of lead.

That means there are other metrics that can point to how good the lead generation of a marketing partner will be.  A big one is the percentage of phone calls to e-mail leads.

At Apartment Finder, 80% of our leads from print and internet are phone calls.  20% are e-mails.   That’s an exceptionally good ratio, I think.

I was on the phone with someone this morning who I should have talked with a month ago.  I had kept putting the conversation off.  Not because I didn’t want to talk with them, but because I couldn’t get myself organized to have a productive conversation.

She said, You must be very busy.

Not in any unmanageable way, I answered.

What I explained was that the restructuring process that we are undergoing at NCI is progressing in an orderly and productive fashion.  There isn’t an unreasonable amount of time that needs to be spent on it, and the key issues are well-defined and being advanced by a team of very capable professionals who do this kind of thing all the time.

But it does create a distraction.  In the face of uncertainty you spend time thinking through the different possible outcomes and waiting for the next development, which help you narrow that range of outcomes.

We brought the top management together this week to talk about where we are.  I outlined my belief that as a company we’d come through two critical phases:  the first, where we reacted to the economic downturn; and the second, where we created new frameworks for recovering.

We were now at the third phase:  The selling phase.  And, I observed, we weren’t moving with as much purpose and effectiveness as I wanted.

The problem, I think, is that we still believe we are mired in uncertainty.  The questions “When will things improve” and “Will things get any worse” are central to our conversations.

That has to change.  The real questions need to be “What did we do this week and how did it work?” and “If things didn’t work the way we expected, what should we change?”  And then, we have to make the changes.  The only way to have these conversations is to track, report and discuss specifics.  Otherwise, you end up mired in generalities.

The challenge is to really demonstrate the mental fortitude and discipline to face forward.  I acknowledge it’s hard, but boy, it’s necessary.

I found myself wondering the other day about the economic impact of the decline in the real estate market on agents.

The reason for my curiosity is pretty clear: The Real Estate Book business depends on the income of real estate agents. The agents who are going to invest in high-visibility, high-impact marketing tools like The Real Estate Book are going to be among the high-earners. Over the past three years, the scale of our business has dropped dramatically and rapidly. How much is a decline in income driving that decline, I wanted to know.
A lot.

Fortunately, the National Association of Realtors is exceptional at gathering a lot of information consistently. The association does several different annual surveys and is smart to keep their questions consistent, so that you can compare trends over time. While their Survey of Home Buyers gets a lot of attention, they also do an annual survey of realtors that has a lot of rich detail on how realtors are managing their business.

So I dug into the NAR data to try to scale the market. There were three clear conclusions: Commission income has dropped dramatically; the number of high-earning agents has dropped just as dramatically; and marketing spending has dropped dramatically.

First, commission income. To extrapolate trends in commission income, I took the average home price and total number of transactions from 1996 to 2009. I then applied a uniform commission rate over the series. (One could argue that average commissions are down the past two years because of the influx of bank-owned properties in the market.)

Using this formula, commission income peaked in 2005 and dropped like a stone to 2009. About 10 years of commission growth was lost in the 24-month period.

Commission income should be roughly flat in 2010, based on NAR home sales projections and a 15% drop in average price. The good news for top earners is that there should be fewer agents competing for the commission dollars, and that consumers are likely to gravitate to agents who have reliable track records and are clearly in the business full-time.

How many agents is that, I wondered? That led me to create another extrapolation to estimate the number of high-earning realtors. To calculate this number, I used the percentage breakouts from NAR’s realtor survey and applied them to the total number of realtors in each year, according to NAR.

According to this approach, the number of high-earning realtors has declined by more than 40% from the peak of the real estate market. All told, there are about 178,000 agents that make over $100,000 per years, compared to 312,000 in 2006.

This is an incredible loss of earning power. The drop in commission revenue has been accompanied by a drop in marketing spend. All told, the number of realtors that spend more than $2500 a year on marketing and advertising has declined 45% to about 200,000.

A couple of interesting trends surfaced when I dug into the distribution of annual marketing spend over the past few years, according to the NAR survey.

First, the median marketing spend was down 31%, less than the drop in commission income over the same period. This is a byproduct of realtors trying to keep up a subsinence level of marketing. The larger marketers cut their spending by 50%.

Second, realtors have not expanded their investment in online media, keeping it at about 10% of overall advertising and marketing spend.

I’m a glass-half-full kind of guy, so when I look at these figures, I’m struck by the opportunity for higher-earning realtors to increase their investment in marketing in order to increase their share of the market. But, by any account, the contraction in marketing spending by real estate agents over the past two years is difficult to process, it is so large, pervasive and complete.

I do.

The first time I got this question, I was surprised and took a second to answer.

Of course I write it, I thought. My name is on it.

When I asked people why they asked, they said that they loved the blog, but figured that I had other people writing under my direction. I was a CEO, after all.

The question prompted two thoughts.

First, we all have different styles of thinking and communicating. I write, so when I hit on something that I’m interested or puzzled about, my inclination is to try to get it down on paper and see whether it makes sense. I can go through my old files and find documents that I have written at different key moments in my career that laid out what I was seeing and how it sorted out.

This blog simply offers a platform to share some of those things. I write it because that’s what I do…write.

The second thought stems from that last point: a lot of people have things to say, but they aren’t people who write. There’s nothing wrong with that; we all have our different styles.

Those people who have things to say but aren’t people who write shouldn’t be left out of the power of using content and social media to communicate. And, people don’t expect them to be left out. When people asked me whether I wrote this blog or not, the question wasn’t pejorative. They don’t expect CEO’s to write, but they do expect them to have something to say.

Two years ago, when I began seriously exploring how businesses were using social media tools to market, I was struck by this basic inequity: the benefits of social media accrued to the people who could write, not necessarily the people who were the best at doing the work of their business. People who were facile with content and technology could stamp out daunting digital footprints, taking mindshare and traffic away from other, potentially more expert and more deserving businesses.

This was the problem we decided to try to solve when we launched the DigitalSherpa line of services: Can you make content marketing using social media tools accessible to local businesses? The purpose was to help level the playing field, to give people who had something to say but lacked the skills to say it a toolkit.

We’ve had some success and are learning along the way. I’m constantly struck, though, by people who look at businesses and say, If you don’t do social media yourself, then you’re not doing it the right way. That statement has an elitist and exclusive air. The real question that all of us should be trying to contribute solutions to is how to make the power of social media marketing available to any business, regardless of how good they are at writing and interacting and sharing.

Go read this five-part blog series from Erroll Morris and then ask yourself the question, How do I make sure that I know when I’m wrong?

Morris is writing about a condition termed Anosognosia, which you can broadly define as not having a clue how wrong you are. No matter how smart we are, none of us are exempt from the condition: we all will encounter the famous “unknown unknowns” that influence our life on a macro- and micro- scale.

As one expert tells Morris:

But when you’re incompetent, the skills you need to produce a right answer are exactly the skills you need to recognize what a right answer is.

The challenge for those of us who are in positions in responsibility is to minimize the potential for anosognostic behavior as much a possible.

The most important way to do this on a daily basis is to try to see things through other people’s eyes. When someone presents an alternative point of view, no matter how aggressively or impolitely, we are obligated to try to understand how that point of view makes sense to them.

When you are in a position of putative power and authority this is one of the hardest disciplines to exercise. But it is one of the most important.

I was struck the other day by the observation that the start of our current recession was sharper than the Great Depression and that the steps taken by governments around the world to provide financial stimulus helped to moderate the decline.

That observation got me thinking about how different the images of this recession are from the images of the Great Depression.

The New York Times had a long article in the Week in Review section this week that captured some of the underlying difference.

A great many people have lost faith in powerful institutions, from Congress to Goldman Sachs. Yet beneath the bitterness coloring national affairs — down at the level of neighborhood, family, coffee shop, tavern — a tenuous belief in the collective good remains, perhaps moderating national dismay.

I don’t think that the Times article intended to demean the level of suffering and pain that individual people a experiencing during this downturn. But they captured something of the zeitgeist that I experience as a I travel around the country. People are carrying on, often with a tremendous amount of energy and a degree of mobility and connectedness that is unmatched by any time in our history.

That perspective made the chart above particularly powerful.

One dramatic difference is the relatively low cost of food in the U.S. compared to other places in the world. The affordability of food is driven by diverse factors, including vast natural resources of our country, federal subsidy programs, efficiencies in distribution and innovations in preservation.

And compared to other countries, there’s no other place on the planet that has cheaper food than the U.S. (2008 data here). The 5.5% of disposable income that Americans spend on food at home is less than half the amount of income spent by Germans (11.4%), the French (13.6%), the Italians (14.4%), and less than one-third the amount of income spent by consumers in South Africa (20.1%), Mexico (24.1%), and Turkey (24.5%), which is about what Americans spent DURING THE GREAT DEPRESSION, and far below what consumers spend in Kenya (45.9%) and Pakistan (45.6%).

When you don’t worry about where your next meal comes from, you can afford to feel optimistic and energetic. The relatively low cost of food in our country is an important element in keeping that positive viewpoint up

The flush of this Spring’s economic activity is wearing off and the American consumer is being realistic about the economy’s prospects.

One indicator can be seen in the muting of the consumer outlook from BIGResearch in June.  Sentiment about the chances for a strong economy were down from May and unchanged from a year ago.

Sentiment is up a long way from the dark summer of 2008, the mood of the last year has stayed relatively unchanged, despite renewed economic activity.

The embedded caution about the economy is reflected in how Americans describe their approach to spending.  74.1% of Americans say they are living a simpler life, according to BIGResearch.   On balance, they are happy about this increased simplicity.  For sure, they are redefining luxury:  84.1% say they aren’t ready to spend on luxury items.  The way luxury gets defined is shifting also, as demonstrated in people’s responses.

This sentiment puts some of the recent economic reports in context.  As summarized in the blog Calculated Risk’s weekly update, the momentum in retail sales is lagging and underlying economic activity is steadying after a rebound to refill inventories that had been allowed to diminish during the initial slump in consumer spending.

These observations were echoed last week in the release of the Federal Reserve Beige Book, which looked at economic activity through May

Economic activity continued to improve since the last report across all twelve Federal Reserve Districts, although many Districts described the pace of growth as “modest.” Consumer spending and tourism activity generally increased. Business spending also rose, on net, with employment and capital spending edging up but inventory investment slowing. By sector, nonfinancial services, manufacturing, and transportation continued to gradually improve. Residential real estate activity in many Districts was buoyed by the April deadline for the homebuyer tax credit. Commercial real estate remained weak, although some Districts reported an increase in leasing. Financial activity was little changed on balance, although a few Districts noted a modest increase in lending. Spring planting was generally ahead of the normal pace, while conditions in the natural resource sectors varied across the Districts. Prices of final goods and services were largely stable as higher input costs were not being passed along to customers and wage pressures continued to be minimal.

The signs suggest that consumer has recovered, but that the recovery is marked by a wide-eyes pragmatism about a weak economy with little momentum for growth.

• Experts Talk Beige Book, Bernanke Testimony (businessweek.com)
• Beige Book and Flow fo Funds Overview (fivethirtyeight.com)
• Economy improving modestly: Fed’s Beige Book (financialpost.com)