Do a Google search for ‘Social Media success stories’ and you will get about 277 million hits. Can websites like Facebook, Twitter and Pinterest really be the making of a successful business? And if they are, it’s only for the big global companies right?
If you answered ‘no’ and ‘absolutely’ then you have probably been living in a cave for the past 10 years. A study by comCast in 2010 suggests that users of social media spend on average 1.5 times the amount online than those that are not connected. Opponents to businesses using social media say it is a waste of time, that it is a fad, and from my professional experience, staff will spend all day on Farmville and we cannot work out a Return on Investment (ROI) on it so we won’t do it.
I read recently a quote that in my opinion nicely countered this argument. To paraphrase it said that when the telephone was invented people said it was a waste of time, a fad, it wouldn’t catch on… when the fax machine appeared people said it was a waste of time, a fad, it won’t catch on… when email came along people said it’s a waste of time, a…. you get the idea. Social Media is a disruptive technology just like email before it, the fax before that and so on.
As for the ROI, calculating the return on investment for a telephone or email is difficult yet they are perceived to be a necessity of modern business. Companies that do embrace social media have found a way to connect with customers that is richer and promotes collaboration and two-way dialog. I think that the secret to doing this social media ‘thing’ well is remembering that it is a communications tool to connect people to people, not a tool to sell more widgets. Yes a financially quantifiable ROI is important, but maybe social media needs to be measured against a different metric such as customer engagement, what do you think?
KLM Airlines did an experiment with their passengers who used Twitter, Facebook and Foursquare and received 1,000,000 tweets about it, what price can you put on exposure like that? Watch the video below, do you think Air New Zealand would receive similar engagement if they did a similar campaign?
Small and medium sized business can now reach out through the power of social media and engage with literally the whole planet like never before and connect with potential consumers regardless of geographic location. Linda Coles describes the process in her book ‘Learn Marketing with Social Media in 7 Days‘ as this:
- Engage your customers
- Listen to your customers
- Build your business network
- Find your cheerleaders
- Do it all over and over again
and guess what, social media lets you do that easily and cost-effectively 24/7/365, yes even in your pajamas! This is of course only part of the contribution to business success that social media offers. There are internal a tools as well that promote connecting, collaborating, communicating and co-operating, but that’s another posting.
For now I will leave the last word on social media ROI to Hitler, enjoy.