Is Social Media Really Helping Your Business Grow?

Six businessmen and businesswomen looking at laptop on boardroom tableDuring another one of my random midday reads of interesting social media news and tidbits, I came across this fantastic BusinessWeek poll of CMOs. The big takeaway for me was that most CMOs think social media agencies are completely full of s***. Most agreed that those agencies have a pretty good understanding of what can be done with social media, the CMOs that were polled also noted that many of the social media agencies they have dealt with have no clue about business, the nuances of their client’s industry, who their clients’ competitors are or how social media can help a business get ahead of its competitors.

Throughout all of the many discussions we all have about social media, the one thing I am continuing to see lost in the conversations is the fact that yes, it’s awesome to proactively and reactively engage with your customers through social media and help them become more engaged with your company. But if social media isn’t doing much to help your business get ahead of its competitor(s), then what good is it really doing in the long run?

Granted, this question is best geared toward businesses that are situated within certain industries, and probably does not apply to non-profits, many of which have a primary goal of directly engaging their constituents, donors and key influencers.

That small caveat notwithstanding, if social media is not helping you get ahead and stay ahead of your competitors and actually grow your business, is it really worth the immense resources and time that need to be devoted to doing social media right?

Recently, I read a post in US News & World Report’s “Alpha Consumer” Blog detailing how consumers react to companies using social media. The piece noted that many consumers are sometimes put off by companies that engage them via social media, mostly because the engagement comes with a sharp marketing perspective. In other words, companies are tweeting people or providing offers on their Facebook fan page as a means to gain a buck or two first, and then build a loyal consumer and follower later (maybe). Bruce Temkin, vice president of customer experience at Forrester Research, put it best in the US News piece:

The key is making the communication seem real—not like advertising. Tony Hsieh (CEO of Zappos) is an avid social media user, so he can communicate in a way that’s authentic. It’s a different story when other executives start using social media just because they’ve been told that they need to do it.

That last line from Temkin is key, in my opinion: using social media just because they’ve told that they need to do it. That’s really the crux of the BusinessWeek CMO poll. So many of these social media agencies come to meetings with CEOs and clients saying that so-and-so in the company needs a Twitter account and the company MUST have a big, fancy Facebook fan page, and that the social media agency will run that account. That’s all well and great, but if the agency doesn’t provide some guidance as to WHY the CEO should be on Twitter and the proper way to engage with his or her followers, rather than just try to always sell or market them something, then really, what good is it doing for the company?

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  • jeffespo

    Great post. One of the thing that is often missed by those in marketing is “how can we monetize this?” This knee-jerk reaction is ingrained into most marketing cultures, and Dell's success in the space did nothing to quell the notion.

    It's also the reason the SM internal proprietors or agencies are looked at with a crooked eye when told that you need to converse on a human level to have success, so it's on us to prove it out, while dealing with the awkward looks.

    In terms of proving a value back to a business, I would suggest taking a look at Razorfish's SIM score. The method groups a company and its competitors into a large conversation bubble and dissects the sentiment and overall conversation share.

  • keithtrivitt

    Thanks for the comment and great points. The knee-jerk reaction to many initiatives and ideas can be a two-headed monster, sometimes. On the one hand, it often spurs new and more creative ideas and can really propel a project or a team to a new level.

    On the downside of that, though, is that realistic expectations and steps/goals/objectives often get thrown out the window as we try to latch onto something that is “hot” and “now.” Keeping it all in perspective and realizing that just becuause technology has allowed us to better and more quickly reach people, successful engagement, brand building and building key influencers takes time, energy and resources to do right.

    And thanks for providing info on Razorfish's SIM score. I had not heard about that, but it looks really intriguing. For those looking for more info, check out this link: http://www.socialtimes.com/2009/07/razorfish-si

  • cnkin

    I think this is an excellent post. Many companies are getting involved with social media, only because they know the trend is heading that way, but with no real understanding of how they need to reach their audience or how social media actually works. I think it all goes back to knowing your audience: how they want to be reached and how they will respond.

  • We start every conversation with the reminder to “chase customers and not technology.” We've had to spend too much time “undoing” misplaced social media ideas that didn't match brand to customers… thanks for the solid post.

  • Re: CEOs thrust into the social media space–are there actually any examples of successful CEOs with a huge social media presence that were taught what to do by an agency? It seems to me that all the rockstar CEOs took to this space naturally.

  • keithtrivitt

    You're spot on with this: you have to know not only WHY your company should be engaging in social media, but also WHERE. And the where may be an even bigger factor than the why because there are so many platforms, networks and online communities out there now to engage in. Taking the time to think about how your company and its customers/stakeholders could benefit from social media is a big first step in doing this right, rather than flailing at it for days and weeks on end with little positive movement or progress in sight.

  • keithtrivitt

    Wow. I love that line “chase customers and not technology.” So simple yet incredibly true. When you are chasing after customers and trying to make their lives better, then you are working to find ways to utilize social media to connect with them and that best match the brand to customers (which, is what customers want). If you're chasing technology, you're just going after whatever is hot now, and really, you're putting your customers second behind a big, flashy campaign that has little substantial use for your customers. Man, that is some good stuff!

  • Great Post – Thanks.

    Just make sure: Don't use #hashtags like Habitat! — http://tinyurl.com/ybnf59w

  • laneyc

    This is an interesting concept. I wonder if PR agencies will start to specialize in the services they offer. Will one sort of agency cater to companies not wanting to break into SM? I think depending on what the agency wants to get out of their business this could be a dangerous move. At the same time, how do we know when its right to counsel our clients into SM? If your consumer base is really small, SM may not be the right strategy. I think its tailoring and working with the CEO, CMO and the rest to figure out what they want to accomplish and if SM is the right way to go.

  • keithtrivitt

    Laney – You laid out those guidelines for how a business SHOULD go about pursuing social media initatives. Take some time. Think about whether this will benefit not only your current and future customers, but also your stakeholders, and ultimately, your entire business. Is this going to build advocates for your business and products? Will this generate new sales or business leads? Will it actually lead to long-term (and certainly, short-term) growth for your business that you can build on? All of those questions have to be asked BEFORE you begin even consider utilizing one of the many social media networks, platforms and communities that businesses can now engage in online.

    It's a tough call as to when we know it's right to engage our clients in social media. I'm a very big believer in that you can't just begin a social media plan/strategy for a client because they say they want it or their CEO says they have to be on Twitter and Facebook NOW! In my book, that is not a strategy that will lead to long-term growth and enhancement of the business and of its customer engagement/relations. Tak to all sides. Ask customers of your business if they want your company engaged in social media. Conduct a survey, whether formal or informal, and ask customers, your CEO, your stakeholders, lots of people, whether they want to see your business engaging with them and others in social media, and then – just as importantly – where, if at all.

    Simply put: Ask people – your customers, business advocates, vendfors, ect. – what they want in terms of enbgagement from your company. Listen to them, cater to their wants and needs and provide them with the tools, info and resources they need to continue helping to build and advocate for your company.

  • keithtrivitt

    Ooh, great question, TJ! Hmm … need to think about this one for a while. I think I agree with you that all of the rockstar CEOs out there who are heavily – and successfully – engaged in social media took to it themselves. Tony Hsieh of Zappos is probably the most well known of these rockstar CEOs.

  • Great post, Keith! You bring up such an important point about “the immense resources and time that need to be devoted to doing social media right.” Key word: RIGHT. So many can dive into SM and it can go so horribly wrong wasting time, money and possibly creating damage that would have not otherwise happened.

  • Excellent topic, Keith!

    As a Director of Social Media for a full-service PR company, I definitely have clients wondering about this every day. Is social media worth it?

    I'll answer it this way:

    Is it worth it to have top-of-mind access?

    Is it worth it to have a customer spend one second with a warm thought of your brand?

    Is it worth it to have another outlet that you control the messaging of?

    My answer is almost always, yes!

    How does that turn into dollars? Hard to measure. But if you own a widget store and there are three widget stores in town. But you have a social media campaign targeting widget users, they'll know your widget store is there when they have to buy a widget.

    Even if the biggest value of social media is KEEPING your customers, isn't it worth the time to make sure they don't buy their widgets at another store?

  • keithtrivitt

    Mike – Thanks for weighing in and providing all of us with some spirited reasons to get behind social media for companies (as an aside, I definitely agree with your points!).

    Let me counter with this: Do those customers really know that your widget store is there when they want to buy a widget, or do you think they know and/or do they just think you have a really cool social media campaign going?

    My point is: It's great to build all of these great campaigns and social media outreach programs, but if we're not doing anything to produce a result both during AND after the fact, what value are we really getting out of it, and how much of a company's valuable time and resources are we draining? Yes, it's worth a company's time to keep current customers and make them happy, but what is your company doing to generate some kind of positive results out of that? And we can measure results however you want: satisfied customers, sales, lead generations, referrals, etc. But if you're just tweeting and building a Facebook fan page because you think you need to and because your competitor has one, with little to no plan of how to take that engagement and generate some type of positive results and action from it, is it worth the time and effort? Would your customers prefer to be better served via different avenues?

    I certainly don't know the answer, but I do think I tend to lean to your thinking that at the very least, we need to research how our current and future customers want to be engaged to at least keep them intrigued and excited about our brands.

  • Great post, Keith! You bring up such an important point about “the immense resources and time that need to be devoted to doing social media right.” Key word: RIGHT. So many can dive into SM and it can go so horribly wrong wasting time, money and possibly creating damage that would have not otherwise happened.

  • Excellent topic, Keith!

    As a Director of Social Media for a full-service PR company, I definitely have clients wondering about this every day. Is social media worth it?

    I'll answer it this way:

    Is it worth it to have top-of-mind access?

    Is it worth it to have a customer spend one second with a warm thought of your brand?

    Is it worth it to have another outlet that you control the messaging of?

    My answer is almost always, yes!

    How does that turn into dollars? Hard to measure. But if you own a widget store and there are three widget stores in town. But you have a social media campaign targeting widget users, they'll know your widget store is there when they have to buy a widget.

    Even if the biggest value of social media is KEEPING your customers, isn't it worth the time to make sure they don't buy their widgets at another store?

  • keithtrivitt

    Mike – Thanks for weighing in and providing all of us with some spirited reasons to get behind social media for companies (as an aside, I definitely agree with your points!).

    Let me counter with this: Do those customers really know that your widget store is there when they want to buy a widget, or do you think they know and/or do they just think you have a really cool social media campaign going?

    My point is: It's great to build all of these great campaigns and social media outreach programs, but if we're not doing anything to produce a result both during AND after the fact, what value are we really getting out of it, and how much of a company's valuable time and resources are we draining? Yes, it's worth a company's time to keep current customers and make them happy, but what is your company doing to generate some kind of positive results out of that? And we can measure results however you want: satisfied customers, sales, lead generations, referrals, etc. But if you're just tweeting and building a Facebook fan page because you think you need to and because your competitor has one, with little to no plan of how to take that engagement and generate some type of positive results and action from it, is it worth the time and effort? Would your customers prefer to be better served via different avenues?

    I certainly don't know the answer, but I do think I tend to lean to your thinking that at the very least, we need to research how our current and future customers want to be engaged to at least keep them intrigued and excited about our brands.

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