Social Media: How small businesses can profit online

Think social media marketing is a waste of time? Think again. In the 2009 Social Media Brand Engagement report compiled by Wetpaint, a social media platform, and the Altimeter Group, a digital consulting firm, it's shown that social media – or conversational – marketing can have a significant impact on a company’s branding and bottom line.

The study, released on ENGAGEMENTdb.com, found that companies with a high level of social media marketing and interaction saw an 18% increase in revenue from July 2008 to July 2009. Their least active counterparts saw a drop of 6%, creating a 24% difference in revenue potential between those who were savvy social marketers and those who weren’t.

In an age where social media seems to dominate online activity, there’s a large market just waiting to be spoken to. Surprisingly, though, not all companies are quick to jump on the social media bandwagon, leaving plenty of opportunity for the few who do to dominate the market.

In the ENGAGEMENTdb study, Starbucks came out on top of the top 100 brands whose social media practices were reviewed. They were followed closely by Dell, then eBay, Google, and Microsoft. The top 100 companies were found to be highly active on Twitter, Facebook, blogs and wikis, among other popular social media channels. They're also all large corporations with massive marketing budgets.

What’s the winning strategy worth? Starbucks has a dedicated six-person social media marketing team, but has a company-wide philosophy that encourages employees at all levels to connect with customers. Toyota, somewhat new to the social media marketing scene, runs their campaigns with three dedicated team members. But not all companies can afford to hire social media marketing teams. So, how does the little guy enter into the realm of social media marketing, and become a success?

Dream Big, Start Small – Pace yourself. It takes time and effort to develop valuable, profitable relationships with customers. Start with a single platform such as Twitter, Facebook, or a blog, and develop your brand there. Build a dedicated following and interact with your customers before moving to a second platform. Keep in mind that with each network you build, additional time will be required to cultivate and maintain relationships - Don't forget to set aside enough time each day to pay attention to all of your accounts!

Set a Schedule – Social media markets are huge fields, and it’s easy to drown in them. Social media has many virtues - among them, it’s free and allows a personal connection with your customers – but it can also be a real time suck. Don’t let your marketing plans interfere with your day-to-day business operations. Set a schedule for social media marketing and stick to it.

Offer Value – Nobody wants to be blasted non-stop with commercials all day. Make sure that you provide your followers with relevant, useful information, and focus on providing value. One of the keys to a successful social media campaign is finding a good balance between useful information and promotion. For example, on Twitter, I typically recommend my clients tweet an 85/15 percentage of useful info to product/brand promo. Market wisely and you’ll find that people pick up on your brand and talk about it to others.

Leverage Your Followers – A brand’s greatest ambassadors are the people who love it. I often see business owners making the mistake of bombarding people with posts about their products, and not bothering to engage with their audience. You should offer incentives to give your followers a reason to talk about you and your products to their peers, whether it’s a contest, promotion, or referral program. Word-of-mouth is one of the oldest marketing techniques around, and it still works really, really well.

Hire a Professional – Do-it-yourself marketing is incredibly popular these days, but it always pays to hire a professional for a campaign tune-up. A marketing consultant can assess your current marketing plans and make helpful recommendations based on your target audience and the performance of your campaign to date. You never know, there might be a small change that can make a huge difference to your bottom line.

Have you used social media marketing as a way of engaging your customers? If so, what have you tried and how has it worked for you? Please leave your comments below. Some answers may be used in future case studies on the Community Marketing Blog. And, as always, you can talk to me on Twitter @JulieTyios.

Comments

[Julie Tyios]

Thanks, Barry! There are many things companies can do with social media, but unfortunately it does take quite a bit of time, as opposed to money. In the end, though, that kind of feedback is quite invaluable and it creates the opportunity to create a personal, lifelong relationship between the consumer and the brand. I think @Starbucks is doing a great job of this, especially as they incorporate a wider advertising campaign and their company's philosophy into the mix. There are a lot of lessons to be learned there.

[Barry Harrison]

Hi Julie, thanks for sharing this. It's good inspiration to see how the most successful brands are using social media to grow more successful. Now, if only we can add more hours in the day....

[Julie Tyios]

Thanks, Megan! Looking forward to reading it.

[@MeganMcQ]

Julie, Great post! I think I'm going to write a follow-up on my blog, I'll let you know when I publish it!