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Practical Reasons Why Businesses Need Social Media
Posted on April 24th 2011
Where are your customers?
Jacob Morgan with Chess Media Group wrote a short but sweet post in mid-March. His approach to convincing potential clients on adopting social media goes like this:
“If I told you that many of your customers and prospects interacted and communicated in the social space would you invest in having a presence there?”
“What if I told you that you would never know you made a single direct dollar off of any of those customers and prospects in the social space, but you knew that they were still there, would you still invest?”
Now step in the executive’s shoes for a moment and imagine how you would react. Would you say, “Yeah, even still, I refuse to go where my customers are.” Of course you wouldn’t and that is why this approach is effective.
There is a sense of urgency within both small and medium sized businesses, but when we look at large companies, they are publishing hugely effective social media campaigns. There’s a disconnect. Small and medium sized businesses don’t usually have PR and Marketing departments. If they do, it’s one or two employees representing each main department. With small businesses, it’s a resource issue, so many times you have executives sitting in their office justifying social media out the window. So what might motivate decision makers, within companies, to integrate social media in their departmental plans?
Executives like numbers
Show executives the potential of social media by using statistics. There was a great post over on the Social Media Club website a couple of days ago, based on the 2011 Social Media Marketing Industry Report. That post highlighted the benefits of using social media platforms:
- 72 percent of respondents said social media Increases website traffic
- Improved Search Rankings – (62%)
- New Partnerships – (59%)
- Better Sales – (48%)
- Reduction in Marketing Costs – (59% for self-employed, 58% for small businesses)
- Respondents were twice as likely to increase leads using social media
Let’s face it, executives like numbers. They see the direct affect an action has on the bottom line. Most companies went through a phase where employees went to their director or manager and pointed at social media saying, “Come on, look everyone else is doing it.”, but of course in the beginning they had no numbers to prove it. If you research communications, marketing, public relations and media for years, then follow and research social media as it evolves, you will be convinced that social media is just about the most powerful tool so far in human history. Without numbers and statistics though, arguing this case is difficult. Executives, branch directors and managers are slowly realizing the potential of online communities, likely because we now have over 7 years of wide spread usage of blogs and a handful of years of accumulated usage and sales statistics from online social networks.
Consumer Expectations – An Example
Imagine an advanced software company. There are a few employees at this startup and they are selling custom programs, and yes they have had a few repeat customers, but they find acquiring new clients to be difficult. The executive is wondering why, and the reason is quite simple. Take a look at that bullet list above because the second item highlights the issue in this example. Search rankings are important, but make no mistake about it, those metrics are tied to social media. If I hear about a really interesting product and I google the company or product name, there should be at least a handful of results pointing to their website, but alas, in this case, there is only one related link. What do you imagine a potential customer will think with these results? Maybe, “This is an advanced software company trying to sell me a computer program and it’s hard for me to find them online?
When it comes to information and research, the online world is now more important than our physical world.
Imagine this same software company, but in this next scenario, they have integrated social media into their marketing, PR, SEO and customer service strategies. How different do you think the picture is? The first page of the search results alone will be filled with network accounts and profiles of this company, and even a positive review or two on separate social networks. That is the effects of social media on business. Consumers will expect companies to be engaged in online communities.
Businesses that are not connected to these types of services will either join, or exist as a small mom and pop shop, limited to their own city. Today, that advanced software company would not be able to expand into other cities without using social media. I realize I might be preaching to the choir here on Social Media Today, so let me add some more depth below.
Many online communities are guilty of deception because they seem to be user-friendly. In fact, there is a hidden learning curve. By that I don’t mean learning the buttons and the interface.
Tap into the deep functionalities of the online communities to accelerate participation and engagement with your followers/fans/friends, ultimately leading to more quality relationships and therefore more sales.
The reality is that on twitter alone, you could search “twitter tips” and you will get thousands upon thousands of blog posts that provide helpful tips. The deep functionalities of every community offers their users accelerated organic connections. You’ll notice this with Facebook, LinkedIn and all the other social sites as well. About once a month I’ll see a blog post outlining tips and tricks, stuff you didn’t know, settings that will change your experience with such and such social network.
If a company has been on Twitter for 3 years, they will inevitably have more followers than a company that just joined (more like 50 followers). The experienced company has already climbed that “deep functionalities learning curve”, so they are doing what works. Whereas the new company is still figuring out their strategy and positioning, while only sending out tweets about their service. One key point in using social media for business is to engage with clients and consumers, right? Businesses want more quality relationships and of course, increased revenue. The sooner a company starts climbing the deep functionalities learning curve, the sooner their Klout (Online reputation and engagement metric) score will be at a respectable level.
Good Social Media Consultants can provide that crucial guidance, but just be aware that there is a learning curve. If you hire the right consultant or advisor, he or she will help your find those hidden functionalities, to tap into the true potential of each social media website.
The Effects of Social Media
I realize some of you may disagree that social media is “the most powerful tool so far in human history”. If you agree with me, you might already be thinking about Tunisia, Egypt, Libya etc. Or you may be wondering why the top handful of social media websites are being valued about 50 times above their latest revenue reports. Let me go further and point out that I am certainly not alone in this perspective. One scholar at Simon Fraser University is predicting that social media might be bigger than the industrial revolution in terms of societal effects. Now, let that sink in before going to the next paragraph!
Avoiding social media and not integrating it into your multi-departmental strategies is a dangerous decision because consumers expect it and despite the deceptive nature of some of the popular social platforms, there is a learning curve to climb.
I believe some of us can see the crest of the oncoming social media wave, but like a great surfer, you might want to swim towards it to get that great reward before it’s behind us when social media has evolved into a completely different system.