“Hype right now exceeds the reality” is the sub-head of a piece in today’s Wall Street Journal whose headline “Entrepreneurs Question Value of Social Media” says it all.
But don’t be fooled. Several of the entrepreneurs featured in the story actually gushed over how they converted leads to sales through active listening and consumer engagement via Twitter and elsewhere:
“‘The people coming from social media have been buying,’ says Stephen Bailey, who oversees social-media and other marketing initiatives for John Fluevog Boots & Shoes Ltd., a footwear and accessories retailer in Vancouver with about 100 employees.
As evidence, Mr. Bailey points to a 40% increase in online sales in 2009â€”the first full year the company engaged consistently in social-media marketingâ€”compared with 2008 when it was just getting started. The second we started using social media, it became one of the biggest drivers of traffic outside of search engines.'”
The operative here: consistent engagement. Registering for Twitter and Facebook accounts without a dedicated (and engaging) professional to feed and nurture them will invariably lead to dashed expectations, as evidenced from a survey of 500 U.S. small-business owners, which found that:
“…just 22% made a profit last year from promoting their firms on social media, while 53% said they broke even. What’s more, 19% said they actually lost money due to their social-media initiatives.”
My guess is that many of these firms signed up for the ride, but didn’t invest the time. Others may have been hoodwinked by one of the social media snake oil sales force that abounds on the inter-tubes. In fact, eMarketer today posted a study titled “Social Fans More Likely to Buy” from Chadwick Martin Baily/iModerate, which found that:
“social friends and followers feel more inclined to purchase from the brands they are fans of… More than one-half of Facebook fans said they are more likely to make a purchase for at least a few brands, and 67% of Twitter followers reported the same.”
So while today’s Wall Street Journal headline may be provocative, the case for, and growing number of business case studies about, social media as a measurable marketing discipline will soon silence most naysayers. As the Chadwick Martin Baily/iModerate study found:
“The power of earned media gives a further boost to brands: 60% of respondents claimed their Facebook fandom increased the chance they would recommend a brand to a friend. Among Twitter followers, that proportion rose to nearly eight in 10.”
If you still have doubts, just talk to any of the ebullient attendees of this year’s SxSWi.