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Social media increases business

April 1st, 2009 / By: / Marketing

Can businesses find success in social media marketing in today’s economy? Yes, they can.

Take a page from the high-end playbook: President Barack Obama used social media to build a base of enthusiastic supporters who carried him to the White House.

“Instead of asking ‘Where can I find people to hit with my message?,’ his thinking was ‘Where can I find people to spread my message, and why would they want to?’” says Jim Tobin, president of Ignite Social Media in Cary, N.C.

While blogging has been around for seven years, the concept of using it for marketing is only three years old, says Tobin, whose clients include heavy hitters such as Microsoft, Comcast, Intel and Dell. Not only are savvy companies blogging on their own Web sites, but they’re also showing up on YouTube, Facebook, MySpace and other social networks. Like President Obama with voters, they recognize the importance of entering into a dialogue with customers and potential customers.

Social networking gives customers more control

Corporate America may find engaging in a forum in which everyone’s comments are virtually open to the world a daunting prospect. But, notes John Bruce, CEO of Awareness Inc. in Waltham, Mass., “Companies don’t control their brands anymore. Customers now own brands pretty much. They’re talking about you even though they’re not involved. The Internet changed that. You can’t do a search on any brand and not find people talking about it.”

Awareness Inc. has provided social media marketing services for the American Heart Association, Kodak, Jet Blue, Sony, The Hershey Company, Proctor & Gamble, Animal Planet, Motorola, and the country’s largest fast-food franchise.

“McDonald’s has 60 independent [online] groups not sponsored by McDonald’s,” Bruce says. “The best a company can do is stand sincere to the brand—rather than be uninvolved in the discussion, to get very involved; and when people say incorrect things, stand ready to correct them. McDonald’s not only engages in discussions, but stimulates them. Create your own community; provide a place for people to talk about your product.”

At the age of 74, seasoned entrepreneur Bill Marriott, CEO of Marriott International, began a blog on the corporate Web site that has translated into millions of dollars in bookings at Marriott hotels.

“People are pleased to see a company have a human face,” Tobin says. “If you can humanize your company, people like you more on the positive side and they’re much more forgiving if you make a mistake.”

As the economy soured and corporate budgets took a beating, Tobin says, his phone began ringing more. That’s because social media offers more bang for the buck than many traditional forms of marketing.

“In a time of recession, it is important that you stay close to the customer and that every dollar you spend really pays its way,” Bruce says. “[Social media] is incredibly cost efficient, not just in the number of people you reach, but also in the quality of interaction.” And, he notes, there’s an added benefit. “There is a very well-known company called Salesforce.com. Over half of their new product ideas come from the community they built. If you engage [the public] appropriately, they will give you ideas, counsel you, and they will give you applause when you do the right thing.”

Engage your community

Most companies already have everything they need to engage in social media: a computer with Internet access. The main investment is time. But before you begin, develop a strategy.

“You need to take a step back and look at the community you would like to impact, and then figure out what sorts of online conversations are already there and what your place is in those conversations,” Tobin advises.

While Awareness Inc. customizes communities for those willing and able to invest in professional consulting, the company more recently began offering prefabricated “best practice communities” to fit a variety of goals.

“If there are discussions [online], it behooves you to get involved in them. Reach into the existing communities and at the least point people back to your own community: ‘This is a great conversation; tell me more over here,’” Bruce says. “Offer them a chance to come along to a community where they will see material that is relevant to them. When they are in the community, induce them to invite their friends.”

But, Tobin cautions, enter social network sites as you would a cocktail party. “If you go to seven different cocktail parties, ignore the chatter, and say the same thing seven times, you could get reactions ranging from being ignored to negative reactions. If you send the same message to multiple networks, you are spamming in a new way.” Instead, he suggests, listen to what people are saying and respond accordingly.

Social media marketing’s disadvantage is that you can’t control it the way you can control advertising. “It’s a challenge to say things that are interesting,” Tobin says. “If you do, the benefits are tremendous.”

Social media creates online communities

At first blush, it seems counterintuitive that a business whose largest customer base comprises senior citizens would turn to what many deem as the realm of Generation Y. The Fabulous Palm Springs Follies, a Ziegfeldesque revue in its 18th season, features a cast with an average age of 70.

“I think there’s a misperception that older people are offline,” says Greg Purdy, media relations manager for the California theater attraction. “It is a very wired demographic, but in a different way than young people are, and I think what has prompted that is the need to connect.”

Two years ago, the Follies posted its first video on YouTube; it now has 38. A recent video showing guest star Susan Anton received almost 3,000 hits within a week of being posted.

“I started typing a monthly newsletter to our then-small e-mail database. From the very first e-mail, which was text only, we got a huge response,” Purdy recalls of the Follies’ entrée into social media marketing. “We now have 40,000 people we communicate with at least monthly via e-mail.” The new version includes multimedia links to features such as newspaper and magazine clips, video, wallpaper, and even games with avatars, as well as links to Follies pages on MySpace (about the theater and music) and Facebook (about the cast members).

Tracking markets

For years, the Follies has vigorously pursued traditional marketing opportunities, including attending trade shows and other events. Marrying traditional with new strategies, they post images from such events on Flickr; a recent posting racked up 4,000 downloads. They also take photos of patrons outside the theater before the show and post them on Flickr for those people to share with friends and family. Although Flickr offers a free service, the Follies pays $25 a year for the capacity to upload more than 100 megabytes a month.

“Feeding the pipeline,” Purdy says, is the biggest challenge. “Repurposing is an important word.

“Everything we do is fairly deliberate,” he notes. “We don’t just throw it out there because it’s the latest and greatest. I think it’s important to see if your market segment is in sync with what the latest is.”

Purdy has signed up for free Google alerts that help him track mention of the Follies on blogs. And people who provide an e-mail address when they purchase tickets to the show are invited—by way of a thank-you letter with a link leading to Trip Advisor, Yahoo Travel, IGoUGo, and Yelp—to share their Follies experiences online. While it may be difficult to derive hard numbers from social media marketing efforts, there’s clear evidence that it works.

“We are No. 2 in things to do in Palm Springs,” Purdy reports of the Follies’ Trip Advisor ranking. “We were No. 12 in September before we started this.”

Janice Kleinschmidt is a freelance writer based in Palm Springs, Calif.

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