We’ve seen and heard all of the statistics: billions of people are on social media; people check their social media accounts every day; you can double your sales by having an active social media profile. For some businesses, social media marketing is a great way to reach new potential clients; but for many others, social media marketing feels more like a giant waste of time, effort and money. Is it possible that social media marketing is overrated?
How Much is a Like or Follow Worth?
For most businesses, the number one goal is to earn revenue and increase the value of the company. This is generally accomplished by providing a service or product that people are willing to pay for; any advertising should be focused on convincing people to purchase one or more of your offerings.
This basic business principle creates one of the fundamental questions about the efficacy of social media marketing: how much is a like worth? What is the value of one company having 50,000 Facebook likes or 20,000 Twitter followers? How does that translate into increased profits? While it’s very nice to be loved on social media, people investing lots of time, effort and money into it should ask themselves the following questions:
- Are your followers taking any sort of profitable actions (making a purchase)?
- How much of your website traffic is through organic social media searches?
- How many of your followers are active social media users?
- What is your return on investment?
- Are you measuring your success?
One of the main challenges marketers face when relying on social media is that many of the people who regularly use Facebook, Twitter, Instagram or other channels are not able or ready to take any revenue-generating action. Someone may like a humorous video you posted or follow you because you offer interesting information, but if they aren’t spending money, what does it matter?
Great for Increasing Awareness, Not Generating Leads
It can’t be denied that the sheer number of people using social media makes it a powerful tool in reaching a massive amount of people for a low cost. But this becomes a debate about quality vs. quantity and about the goals of your social media marketing. For example, if your marketing goal is to make more people aware about your new business and what it offers, then social media could be very effective. However, if your goal is to increase annual sales by 50 percent, social media may not be the most effective advertising strategy.
Although many people rely on social media for product and company research, it’s very difficult to directly link a company’s social media presence to increases in revenue.
- 56 percent of consumers who follow brands on social media do so to view new products
- 31 percent of online shoppers use social media to look for new items to buy
- 41 percent use social media to look at new ranges when they launch
- 24 percent use social media for inspiration to buy new gifts
- 16 percent use social media to keep up to date with fashion
The above statistics indicate that for a large portion of social media users, it’s a channel for pre-purchase research more so than a channel for to make a direct buy. Online shoppers are more likely to go to Amazon or a website’s store before they make a purchase on Facebook. This makes it difficult to accurately measure the impact of social media marketing on consumers’ buying decisions. However, it’s worth noting that this is something that may change in the future as Millennials and Generation Z gain more buying power.
Another factor to consider is the lack of trust that consumers have for online and social media marketers. With the proliferation of fake online reviews and other shady tactics brands use to artificially build their reputations, it’s hard for consumers to trust what they see on social media, which makes them less likely to make purchasing decisions based on anything they see on Facebook, Twitter or any other channel.
- 30 percent of Facebook users and 25 percent of Twitter users said they had little or no trust in brand information they see on social media. Instagram (23 percent), Pinterest (21 percent) and LinkedIn (20 percent) did not score much better.
Social Media Marketing Still Has its Uses
While it’s unlikely that a single Facebook post will lead someone to buying a new car or that a Twitter post will greatly influence consumers’ purchasing decisions, the cumulative effect of social media marketing should not be overlooked. In an age where consumers are more informed than ever before and information is a five-second phone search away, it’s impossible to deny that social media marketing plays a role in converting browsers into buyers. If information a person finds on your Facebook page helps his or her product research, then your social media marketing has had some effect.
To get the most out of your social media marketing, however, you must understand why it’s important, its limitations and what purposes it best serves.
- Not a Standalone Tool: Using Facebook, Twitter or LinkedIn as your only marketing strategy is doomed to fail. The competition among brands and the inherent distrust people have on social media make it difficult to use as a standalone marketing strategy. Social media marketing is most effective when it is integrated with other advertising strategies.
- Not Really Free: One of the more common arguments used in favor of social media is that it’s free to use. This is a somewhat hyperbolized myth. First-of-all, time = money. Any time you spend on your social media platform is time you aren’t spending on other business functions. In many cases, business owners have to pay social media coordinators a full-time salary. Add in the fact that social media sites have limited organic post reach (meaning only a small percentage of your followers are seeing your posts) to force marketers to pay for greater exposure, and social media is far from free.
- Great for Referrals and Sign-Ups: Social media is mostly about leveraging the power of word of mouth through a digital format. Because of this, referral programs, where people invite friends and family members to sign up for services, visit a website or download a new app are highly successful on social media.
- It Pays to Pay: Trying to grow your business’s social media influence through using only free options is very difficult and time consuming. Implementing a paid advertising strategy on your Facebook page will allow you to more quickly reach people who would be most likely to have an interest in your services or products.
Depending on your business and your goals, a heavy focus on social media marketing may or may not be an advisable strategy. But rather than guessing and potentially wasting your time and money, it’s best to work with an experienced advertising agency that understands what works and what doesn’t. Mary Pomerantz Advertising is a veteran of both traditional and modern marketing tactics. We are uniquely qualified to coordinate and execute your advertising strategy. Contact us today at 732-214-9600 to discuss your marketing.