. The Transom .

Wednesday, September 19, 2007

The bottom line with social media

I just finished giving a presentation to the St. Louis PRSA chapter on Social Media and its role in business strategy. There were a lot of great questions at the end and I think people walked away with a little more to think about than before. That was a goal. There is so much potential out there right now and we just have to maximize it.

One point that I made in haste, but it worth repeating, is the real goal of any social media campaign. That is, you have to be able to show that it affects the bottom line or sales, whatever that measurement of sales is for a particular company. Some measure it in revenue, some in leads, some in web traffic. However you do it, it has to be effective. Otherwise it's just a fun way to waste time.

7 Comments:

  • I had the pleasure to attend your presentation yesterday and I want to tell you how amazing it was. Social media is so intriguing, and I really found you to be informative and pleasurable.

    What really resonated with me was the section on "ghost-blogging." The fact that many people choose to puff themselves (or others) up without revealing their real identity is shameless. I'm glad that there are people like you who can tip us lay people off about things like this.

    By Anonymous Richard L. Hung, at Thursday, September 20, 2007 7:39:00 AM  

  • what if the objective is to create awareness, build brand equity, test the waters etc.

    Social Media has many more applications than just driving sales, in fact I'd say it was the wrong medium to do so and to measure its success in sales / leads etc. is particularly difficult in this channel than most others.

    By Anonymous Dave Williams, at Friday, September 21, 2007 7:32:00 AM  

  • Dave - I agree with you that social media has many more applications than just driving sales. But at the end of the day, it has to lead to something. What good is awareness or brand equity if it doesn't lead to sales. Take the old Pets.com sock puppet example. Huge awareness and the company went under because of no sales. I'm not saying social media will replace all marketing efforts. Not at all. I just think if you're going to do something in marketing, it has to lead to advancing the company in more ways than just "people know about us."

    By Blogger Rob Amberg, at Friday, September 21, 2007 8:08:00 AM  

  • Hi Rob,

    I agree with you that the objective of all marketing activity should be to, ultimately, generate revenue. However I'm not sure that, in its current incarnation, its possible for anyone to accurately track the impact a brand's presence in the blogosphere/ second life etc. really has on sales. Much of the current interest from marketing depts. is either driven by (a) a genuine wish to use this channel for improved communications (b) fear of not doing what the competitors are up to.

    I agree awareness alone is of little use, but it remains the first step in Marketing 101's AIDA model, so as part of an overall strategy it has a vital place.

    If you don't create awareness, for example, you'll struggle to sell your product. If you fail to follow up the awareness you create (assuming you've made the right people aware of you) with a compelling message / offer / product , you still won't sell much!

    I guess I'm saying that it would be too risky not to embrace social media, and that many brands are going to have to accept that the traditional measures don't apply.

    Glad I'm not trying to sell that concept to a technophobe board :-)

    By Anonymous Dave Williams, at Tuesday, September 25, 2007 4:40:00 AM  

  • Like any relationship, it sometimes takes years to get to the altar. I disagree with your assertion that social media has to be about the bottom line and measurable. It's about creating community and relationships. It's about sharing ideas and making business personal again. (I suggest reading the Cluetrain Manifesto). These relationships, because yes, they affect business, often ultimately move revenue.

    If social media strategy is done right -- all the benefits follow.

    By Anonymous Marijean Jaggers, at Wednesday, October 10, 2007 7:40:00 AM  

  • Marijean - you said "if social media strategy is done right - all the benefits follow." What benefits are you referring to? From where I sit, it's a hard discussion to tell a CEO or brand manager that we're going to spend thousands of dollars on a social media strategy and not be able to measure the results or show that it will affect the business in a positive financial way. I have found that most companies want to look at social media as an investment, not a cost. You are correct that ultimately these relationships and communities come back to the company in the way of new or repeat customers, positive word of mouth, etc. I just believe that a company should have a business goal with their social media strategy that goes beyond counting how many friends they have on their MySpace page and calling that success. Its like the difference between one agency that shows their client a stack of clips and calls it success versus another agency that can show the business results from the stack of clips. Which one would you rather have working for you? I'd take the one that can tie its work back to my business any day.

    By Blogger Rob Amberg, at Wednesday, October 10, 2007 8:49:00 AM  

  • Sounds like Marijean likes "Sex and the City." Too much about puppies and Cosmo and not enough about real results.

    By Anonymous Andrew Smith, at Wednesday, October 31, 2007 9:33:00 AM  

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