I must admit, a year ago I wondered why I even bothered reading about social media. I didn’t see the point of it for sales. All the businesspeople I spoke to then that had setup a Facebook page or Twitter account simply didn’t see the ROI. Many found other ‘business-like’ communities like Linkedin ten times more effective.
However on the internet, a year is a long time. Things change. You’ll all note the rise and rise of Twitter, Facebook, as well as Linkedin and Youtube. These top social sites are now all mandatory in business, be it selling to consumers or businesses . The statistics on their growth are astounding. Put simply, this is where more and more consumers are going to for advice (from others, usually strangers) on their new purchases.
The New Sales Funnel?
Social media isn’t perfect for sales. However I do appreciate that in some market segments, social does make more sense and can certainly provide sales leads. It’s the online equivalent of ‘word of mouth’ marketing, which we know is one of the most effective means of selling. Many say it’s rewriting the traditional sales funnel. (left, courtesy of genius.com).
I don’t think it’s a the magic wand for every business or business type. For example, it wouldn’t make as much sense for the local plumber or electrician to spend too much time on Twitter, although a Facebook or blog page providing hints and tips could help sales and credibility.
The sweet spot, based upon those who monitor such things, is likely around consumers looking out for new toys for their home or person. e.g Movies, events, new tech gadgets, women’s fashion, latest deals or sales etc. These are all prominent on twitter and Facebook. Even Dell computer runs regular specials via twitter and does better than any one expected, with a massive 1.6m followers.
Another leading consumer electronics manufacturer leverages social media to generate sales and awareness for new products. Its online advocates share a company-produced video about the new product and a promotional offer with their social networks. The results? A 4.8% of the inbound clicks resulted in actual purchases for the new product!
By comparison, the company’s [more expensive] traditional marketing and media efforts generate less than 1% conversions. Another startling fact: each time an advocate shared the video and offer on Twitter, the company got 17 in-bound clicks to it’s website, compared to 1 in-bound click for email. Buoyed by the success of the campaign, the company is now encouraging Advocates to “share the love” by creating and posting product reviews to shopping sites. This result is unusual, but shows the potential of the channel.
Seth was right
It’s all panning out exactly as marketing guru, Seth Godin predicted in his tribes and earlier books. Companies are helping out their own users, followers and consumers for promotion, via these free social media sites. An email campaign to an established client base often kicks it off, but then social connections adding the icing on the cake. It’s then quicker than email alone, has more credibility, a tiny fraction of the cost (zero), and in some markets, much more effective marketing mix than ‘traditional’ Print-Radio-TV. Here the happy customer is doing the selling [mostly] for free. Typically, you’ll get five to ten times the sales leads of your traditional Yellow pages, newspaper and magazine ads, for less cost
However it’s a two-way street. This cheaper promotion does have a price. Without a superb product/service actually worth talking about (i.e. remarkable as Seth would say), zero or bad reviews in social media can kill off a product or good reputation very quickly. The earliest, most dramatic example of this was a Dear Mr Dell letter posted on a blog by journalist Jeff Jarvis in 2005. The end result of this had a dramatic effect on Dell computer sales and reputation, which took them years to recover from.
Don’t overlook the customers media channel
The other little-appreciated fact in developing a social media strategy, is the realisation that more and more people are going to these social websites using their mobile phone, not on their laptop or PC.
80% of Twitter usage is on a mobile device!
This means ensuring everything is mobile-optimised from a format and content perspective. e.g. Clicking from a twitter link back to a company website that takes 3 minutes to load on a mobile or graphics-laden emails does far more harm than good.
Every Day Counts – But where to start?
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Still don’t believe the power of social and online media over Radio, TV and Print? Check out this video..