Archive for May, 2009

Defeating the Two Objections

Thursday, May 28th, 2009

It’s inevitable that I run into someone during the course of my day that thinks his or her company does not need to be involved in social media.  The two main excuses I hear are that the company does not have the time to invest or the executive does not see how the company will get a return on the investment.  Believe it or not, I understand these objections.  The proper utilization of social media can be very time consuming.  Furthermore, spending money to have someone run your social media campaign seems like a waste when a clear return is not quantified.

As a small business owner, I completely understand the importance of time.  It is the one thing us owners and executives cannot get more of.  However, we would all set aside time in our week if we knew it was going to increase our sales.  We will get to return on investment in just a second, but first let’s look at the time commitment required to properly run a social media campaign.  There are a couple of different options you could consider:

1.     Run the social media campaign yourself:  This is a very viable option for those that have flexibility in their schedule and have opportunities throughout the day to update and reply.  However, total time commitment for this is around ten to twenty hours, if done properly.  This is probably time not too many of us have. 

2.     Have an assistant publish your content:  Though authenticity is important in social media, this option allows you to create your own content but have someone else publish it for you.  This saves you time, but is likely to lead to your message not reaching the intended audience or being diluted.

3.     Use a social media expert: I know this seems like a shameless plug, but hear me out.  I ask for a four hour weekly time commitment from my clients and that is if they want to write a blog.  Should they not want a blog, the time drops down to two hours.  That time is spent authoring that week’s conversation topics and replies.  It is then the social media expert’s job to publish those pieces, reach new consumers and respond to standard questions.  The expert acts merely as a filter for the author and allows the company to maximize the social media tool, without a great time commitment.

So, assuming that a company is willing to make the minimum time commitment, there is still the matter of whether the work will lead to a return on the investment.  To determine this, let’s look at your traditional advertising.  Let’s say you advertise well in the area and you receive 100,000 impressions a day.  The success of this advertising is measured by your penetration rate.  For this example, we’ll be generous and say that two percent of people that see your advertising buy from you that day.  Thus, you get about 2,000 customers a day from your traditional advertising.

Now with a little time invested in your social media, you should just as easily be able to put that same message in front of another 100,000 people per day.  However, if you are utilizing social media properly, that should be a targeted group of consumers and your penetration rate will likely be much higher.  Just to be on the safe side, let’s say that it is actually lower and only one percent of consumers buy from you a day.  That is still 1,000 extra customers per day that you got from simply committing four hours a week and investing in a social media expert.

Undoubtedly the numbers in this example do not ring true for too many people, but the general principle remains the same.  Social media allows you to reach a large number of people with relative ease.  A solid message and consistent communication will then allow you to turn those consumers into customers.  If you are not seeing that return, then you are either not reaching enough people or do not have a message that is relevant to who you are reaching.

Without a doubt, I will continue to hear these two objections on a daily basis.  However, next time you hear someone raise such an objection, explain these assumptions are incorrect.  There is time and that time will return a profit.  

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Posted in Observations, social media | 2 Comments »

Where Social Media Fits In

Thursday, May 28th, 2009

Social media is a tool.  Like all tools, one tool cannot do every job.  So how should social media be used?  Where does it fit into an overall marketing plan?  Honestly, the possibilities are endless, but what I have done is nail down three core areas where social media could be added onto a marketing plan.  My recommendation would be to use all three, but I am a little biased. 

Brand Awareness

Advertising should be the first step in a structured sales process.   If your advertising is good, the consumer will learn more about the product; if your product information is good, the consumer will make a buying decision; if you arm him or her with the right incentive, the consumer becomes a customer.  Often I see companies trying to cram each step of the process into the advertising stage, I call this information throw-up.  It leaves the majority of customers uninterested and stops the sales process.

Social media is a great way to prevent the urge to condense your sales process into one stage.  More often than not, the second stage of the sales process is gathering information from a website.  Even retailers will often push consumers to learn about their company online before making a physical appearance.  If you use traditional advertising to push your message, there will be a break in the process from when the consumer discovers the message to when he or she will take the second step.  However, with social media the consumer is already in a position to immediately take that second step, should you give them the proper incentive.

Furthermore, social media allows you to target specific consumers that may be interested in your brand.  Want to target Hannah Montana fans in San Francisco?  A simple search allows you to find them and request that they learn about your product.  This can be much more effective than an expensive advertising campaign that will be seen by a lot of people you are not targeting while also creating the gap in your sales process as discussed above. 

Customer Loyalty

The easiest customers to gain are those that have already bought from you.  This vertical growth is paramount in the troubling economic times we face.  The best way to have customers remain loyal to your brand is frequent, unobtrusive communication.  While mailings, email and phone calls can be nice, if done right, social media allows you to communicate with consumers, even when you are not selling to them.  This keeps you in the forefront of their mind and has them turn to you when it is time to buy. 

The big no-no in social media is openly trying to sell to consumers.  Companies that do nothing besides use social media to push their products are often left wondering why they see little return from their efforts.  You get around this by offering valuable information and insight beyond your product offering.  Then when you offer an incentive to buy your product, it is seen as just another way that you are trying to help the customer, not just a shameless plug.  Authenticity is important in social media, which is why social media is a great way to simply stay in touch with your consumers.

Consumer Research

The least utilized functionality of social media is its ability to understand what is important to your target consumer.  Generally, consumers use social media to advertise how they want to be perceived by the world.  This self-identification is a great way for companies to determine what will ellicit a buy.  This research can be conducted in one of two ways:

Micro: My favorite way to know how to influence consumers is to understand them on an intimate level.  By understanding how they perceive themselves, what is important in their lives and how they want the world to see them, it becomes easy to discover what your product can offer the consumer beyond normal features and benefits.  Though this research is extremely valuable, it is difficult to produce on a large scale.  Instead, I target core consumers that the company is trying to influence and use them as the research base.  Though the data is not very strong quantitatively, it is ironclad qualitatively. 

Macro: The same social media can also be used to better understand your current or potential consumers on a large scale.  Want to know how many of your consumers fish?  This is only a quick search away.  Want to know how many people in San Diego go boating?  Compare the total population of the San Diego network to the number of people in the network that list boating as a hobby.  This may not be an exact science, but it is a free and easy way to target consumers and learn what percentage would be interested in your offering.

The list could go on and on but by focusing on one or all three of these, you will start to see the reward that comes from properly using social media.

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Posted in Observations, social media | 3 Comments »

Measuring social media

Friday, May 8th, 2009

Everyone has an opinion on it.  Some people love it, some hate it, and some do not understand it.  Regardless of your relationship with social networks, it is important to understand the tangible results that it can bring to your company. In order to help companies better understand the reward of a proper social media strategy, we look at two categories: reach and return.

Reach

Reach is further broken up into immediate and auxiliary.  Your immediate reach is whom you can deliver your message to, without anyone passing it on.  This includes not only those you are friends with or who follow you, but also those that share the same groups as you.  Though you may only have 100 friends or connections, if you join a group with thousands of followers, you are able to place messages directly in front of them.  Your immediate reach is the most important because it will be where your message is either carried on or dies.  The greater immediate reach you have, the more likely you are to grow your auxiliary reach.

The auxiliary reach explains a consumer that is two or more degrees away from your immediate reach.  These consumers are only reached when your message is relevant enough for those who received it to pass it on.  This is where the art of social media comes in.  Any decent social media expert can grow the immediate reach of a consumer and push messages down his or her throat.  A great social media expert uses the immediate reach to spark a conversation that is carried well beyond the third or fourth degree of separation.  The way you reach beyond those that you directly touch varies from company to company.  Sometimes you need to ask the right question, sometimes you need to offer the right incentive and sometimes you need to have the right mystery.  Regardless of the means, a successful social media campaign must connect well beyond its immediate reach.

Return

This is the part that most business owners and executives care about.  After all, what is the point of being involved in social media if it does not increase sales?  You might as well save the time for a company picnic.  The return of a social media campaign is also broken down into two parts: leads and customers.

Now, I am sure many will immediately point out that leads are not a return on an investment.  This is absolutely true, but we measure them because leads are important in understanding the return of the first step of the sales process which is the social media outreach.  Most social media campaigns will drive customers to a website, sales person or retail location.  If a large number of consumers are driven to this second stage in the sales process and then decide not to become customers, it may not be the fault of the social media campaign.  The website could be difficult to navigate or understand, the sales person could be rude or indifferent or the retail location may not optimize the shopping experience.

The inverse of this could also be true.  As discussed above, a good social media campaign is spread from consumer to consumer.  However, sometimes companies focus so hard on trying to create a viral campaign that the message is lost.  If consumers are driven someplace for one reason and then are sold on something completely different once they get there, the sales process will end.  Leads are important to measure in a social media campaign because they help you understand where in the sales process you gain or lose a customer.

The core of return is when the consumers become customers.  There are a couple of ways in which to measure how many customers come because of your social media campaign.  The most obvious is to compare sales since the campaign started with sales from the same time the previous year.  Make sure you include any market factors that may have also affected sales when you calculate this number. 

A different way to measure consumer to customer conversion is to offer a special to social media users.  To do this, offer a percentage off, free gift or other special at the beginning of the campaign.  Once the campaign grows, offer another special to social media users.  Good campaigns will at least double the number of customers that come from social media (i.e. 10% of customers becomes 20% of customers) anything less than that should have you reevaluating your campaign.

Measuring the reach and return of a social media campaign is a great way to prove the validity of a successful social media campaign.  There may be other methods out there to proving success, but these have carried the most weight.  Any owner or executive that is considering starting or improving a social media campaign should carefully look at the expected reach and return.

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Posted in Observations, social media | 7 Comments »

The Kiss of Death: Young and Different

Monday, May 4th, 2009

When I look into the mirror, I have trouble believing the face that stares back at me.  Usually a comment like this is followed by the author discussing how they are young at heart, but old in age.  However, the young (and handsome!) face that stares back at me, seems to hide the experience it has witnessed.

In the past six years I went from a small town college student, to a United States Marine, to a Marine infantryman, to a combat veteran, to a young professional, to an interim manager at a Fortune 500 company, to a trainer of foreign troops in Africa and South America, to a two time Iraqi veteran.  Now I am an entrepreneur.

Just looking at the list makes me tired.  When I told my story to a helpful friend at the Small Business Administration, she exclaimed that I have already lived a full life.  And indeed, with so much packed into so few years, it begins to feel like the past six years has given me experiences that few will have in their entire life.  Yet, here I sit, young face staring back at me.

Don’t get me wrong, I realize this is not a problem that too many will elicit much sympathy.  I am quite glad that my physical appearance has not matched the age of my experience.  The only reason I notice my youth at all is due to the mirror that that forces me to see my youth.  However, this is not the mirror that sits in my bathroom; this is the mirror of those I compete against.

As I mentioned before, the path I followed has led me to become an entrepreneur.  At the ripe old age of 25, I decided that I should become an advisor to other businesses.  I never saw a reason why I should not.  I saw that no marketing or advertising firms were adequately addressing how new media changed the fundamentals of communicating with consumers.  I knew I could do better.  I never thought twice about it until that mirror entered my life.

When someone plans a meeting with a consultant, he or she expects a certain amount of grey hair to prove experience.  When a young looking man, dressed like some sort of cross between a punk rocker and a businessman, walks through the door, a guard goes up.  Old men advise companies, not young Rebels.  And this was the mirror that I faced. 

This barrier to entry, silly little things like age and dress, were preventing me from implementing the changes that I knew businesses need.  Instead of potential clients listening to how I could help their business, they were busy trying to figure out how to get me out the door.  There are times I was convinced that if I offered a cure to cancer I would be just as equally ignored.

Now, I realize that there are certain things I could do to make my plight easier.  My mother constantly begs me to try to look a little more professional.  But, as I point out to her, the name of the company is “Rebel,” not “Nice Boys that Dress Well.”  I’m sure this seems like hardheaded stubbornness, but I believe that I have fought for enough in my life and I should not have to change my appearance to get a fair shot.  This may seem like a crazy concept, but I want to be judged on what I have to say, not on what I wear.  And even if I did change the clothes, the age would still be there.

All that said, it has not been completely bad.  Those that have been able to suspend judgment on my age and appearance, long enough to listen to me, have generally been very welcoming to my concepts.  What they have found is that my difference is more than skin deep.  I think differently too and that difference in thought is what allows me to help their companies.  It is what allows me to increase their reach sixteen times over.  It is what allows me to increase leads for their company by over one hundred percent.  It is what allows me to spark conversation that turns a message into action.

Slowly, one by one, I have been able to sway old school thinkers to new school ideology.  This is my fight.  Like most fights that I have experienced in life, the battle does not make me angry.  Instead, I am left feeling sorry for those that work so hard to resist new ideas.  The way that consumers make purchase decisions has quickly shifted.  Those that are left trying to continue down the same path are all but doomed.  So here I sit, young and different, once again staring death in the face.

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Posted in Observations, Opinion, Rebel News | 1 Comment »