How Valuable is Social Media, Really?

When it comes to creating a successful social media program, three core issues need to play together:  build following; create engagement; sales action.  What drives this?  Content. Great content is not simply posting or promoting a product. It’s really knowing the target (down to stereotyping an individual person). It is also constantly refining and adjusting based on what is trending and being shared and commented on.

This seemingly simple equation works … and quite well for GRM. Playing in the uber-competitive cosmetics category, our team is beating the leading competitor for Milani (our client) in engagement rate by 220%, despite being outspent more than 10x by competitors in overall advertising.

The comments at the end of this blog illustrate the constant change going on … not just in Facebook, but in all social sites. Many are looking for the short cut to garnering legions of followers, but unlike traditional media the playing field is not fixed.  The platforms themselves keep revising and adjusting their own rules.  What works in one platform doesn’t necessarily translate to another.  What works today may be dramatically altered tomorrow. 

And one additional myth: Social media is not free.  It is a very competitive environment (by design) where placements and ad dollars are pitted against each other.  Determining your outcomes and ROI should be carefully considered up front. In other words, a plan with measurable goals … not unlike any other effective advertising or marketing program.  And, like great advertising, content is the driver.  Ads and sponsored posts can put you in front of more people, but what happens then?  If the content (creative in traditional ad speak) is not interesting, distinctive, visual or otherwise engaging, the viewer is already rolling down the page.  See ya.

Great content requires first and foremost an understanding of the person (yes, singular) you are actually trying to start a dialog with.  You can build large and thriving communities, but it starts by connecting to an individual.  Social media success requires creativity.  Good writing, visually impactful, a sense of outcome (sales action) desired all play a key role. 

This is usually why one person doing this internally at a company (typically in addition to other pressing tasks) is never as good as a team.

So, there is a cost.  The cost of engaging professionals, who work multiple sites for multiple clients to understand the trial and error and know how to quickly adjust for successful outcomes (and when to cut losses and move in other directions).

The cost of a team, so that your sites are covered 24/7 and there is timely response to engagements and posts … a critical factor in building the online community of followers most brands crave. 

There is also one hidden cost:  how are you measuring up to competition online?  Because the leading brands understand the value of building followers – it is the best and most economical database you can get.  Think about the cost of buying lists, generating signups at events or trade shows, sending out direct mail?  What is the real cost there?  How easy is it to build that list?  Many companies struggle just to build an active and accurate list of their customers, never mind, adding on interested prospects.

If your competition has more followers, simply put, their cost of marketing is less than yours.  Your company is at a disadvantage.  Even greater, they have the ability to exponentially add more prospects than your company, at a lower cost.

Think about this as direct marketing on steroids.  That is what social media can be when done correctly.  So, there is the opportunity cost of what may (or may not) be occurring for your company in social media.

Final word:  referral.

Social is unlike any other media in history.  It is not linear – in that advertisers (or media) push out content/programming/ads and consumers can either choose to read/watch or not.  In social, consumers participate in the content.  And, their participation is not a private letter or phone call.  It is public … on the same site to the same viewers as your original post.

Is that a good thing?  It is a great thing in our estimation.  Great brands are coveted by their fans.  Social has a quick and often viral way of ferreting out the good from the pretenders.  Consumers are educated, experienced and not shy to weigh in with their opinions. 

And their opinions count: in reviews – most consumers view peer reviews more valuable now than professional one; in following – have too few followers and your brand doesn’t seem very credible;  and, most importantly in referral. 

Those most passionate about your brand will follow you. We prefer to call them your ‘zealots.’  Zealots for a brand or cause willingly recommend, engage, and share … otherwise refer you to their friends.  The average person on Facebook has about 300 followers (friends).  This is actually consistent with old-school ‘spheres of influence’ an individual has.  So, 500 followers offer a potential referral of 150,000 people.  Get 5,000 followers and you have your own ‘media vehicle’ of 1.5 million!  Many of these are now being introduced to your brand for the first time by their friend, the most credible referral you can get as a brand. 

What is your cost of prospect / new customer acquisition?  If you understand those numbers, then you understand why social media is not a nebulous cost, but the most valuable marketing asset ever available to companies. 

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