Does your social media actually make you money?

Ryan Boyd
Does your social media actually make you money?

If you’ve got a business, you’ve probably been told a thousand times how important it is for you to be on social media. But does having a Facebook, Twitter, or Instagram account actually make you any money?

According to social media expert Wendy Thompson, Managing Director of social media marketers Socialites, you can’t underestimate the importance of having a brand that people engage with on social media.

“Establishing a strong social presence is the first step in any social media plan and therefore favourites, shares, retweets and likes are good indicators you’re hitting the right notes with your target audience.

“It’s a bit like dating, you need to build trust and credibility first. Once you’ve got that, it comes down to business objectives; if sales is your target then tracking this is absolutely key.”

SEE ALSO: Tools to get your business humming online

 

It takes money to make money

On the face of it, social media looks easy and cheap. You just write some content then post it on your page for no cost and people will read it, right? Well, not quite.

“The number one rookie error I see,” Wendy explains, “is when businesses spend a lot of time and money creating great content – and then don’t allow for paid media budget. It’s like throwing a fabulous party and not inviting anyone.

“Social media is not free anymore, for example organic Facebook reach is between 1-2%. Be prepared to spend money on social media advertising to get results.”

The lesson here is, if you’re going to do social media, you have to do it right.

“Along with rookie error number 1 above, number 2 is probably handing over the responsibility to a too-junior staff member ‘because they’re a digital native’.  

“Social media is one of the most public facing assets you have. Pick someone that really understands your brand and your customers, as well as having the technical skills required. If you don’t have expertise in-house, engage an expert.

“The other big one is consistency. You can’t dip in and out and big brands are often the worst in this regard. All too often I see a social media platform come to life for a few weeks whilst TV and billboards shout about a new product or launch, and then go quiet for months with customer queries unanswered.

“This says to people that you don’t actually care about them, you only care about your own needs. Structure in a maintenance budget to make sure you’re still there for your customers outside of campaigns.”

 

What’s your end game?

So before you begin your social media strategy, it pays to think about what you actually want to achieve from it, and, perhaps more importantly, whether those goals are realistic.

“Your social media should align with your overall marketing strategy and objectives at the highest strategic level. It’s at the tactical level where you must stay nimble and review monthly as social media platforms are constantly evolving. 

“For example if a strategic objective is to reduce churn in a younger demographic, a social media tactic would be to invest time learning about any social media platforms that gain popularity in the youth market.”

 

Chasing sales online

Despite all the buzz around social media, according to a study by McKinsey & Company from a year ago, email is (or at least was in 2014) a far more lucrative channel than social media, claiming:

“E-mail remains a significantly more effective way to acquire customers than social media — nearly 40 times that of Facebook and Twitter combined. That’s because 91% of all US consumers still use e-mail daily, and the rate at which e-mails prompt purchases is not only estimated to be at least 3 times that of social media, but the average order value is also 17% higher.”

Trying to use social channels purely for direct sales is missing the point of social media, says Wendy.

“It’s a long game not a short game, you’re building a relationship. If you’re only selling all the time then people are going to switch off.   As a general rule engage in at least 3 non-sales pieces of content for every one direct sales pitch. This really does pay off.

“Don’t lose people by being too aggressive with sales messages. Be relevant, and use the inbuilt tools in most social media platforms to target your messages to your customers, especially your sales pitches.”

 

So what actually is the value of a ‘like’?

Looking at your company’s analytics can shed some very useful light on what works and what doesn’t for your business, and can calculate an accurate comparison on what you spend vs what you get back.

Wendy says Socialites calculates ROI using measurements such as cost per acquisition, cost per conversion, cost per sale, brand sentiment shift, audience reach, and audience engagement levels.

If you want to find out a quick and rough estimate for yourself, Dan Zarrella, a social media scientist at HubSpot, created a formula to help businesses calculate social media ROI with Value of a Like. VOAL allows you to input a number of data points (which can be learnt from Google Analytics) and it will tell you how much each ‘Like’ on your page is actually worth.

 

Need help?

Wendy’s team at www.socialites.co.nz can help especially if you have big goals and/or are looking at foreign markets, paying for expertise is well worth it. 

For DIY to primarily NZ customers, Facebook is the biggie so you need to get your head around this first, for inspiration have a look at the case studies on Facebook or keep an eye out for any courses near you.

For training in Auckland check out www.theclassroom.co.nz run by Clare O’Connell.

SEE ALSO: Tools to get your business humming online

Tags:
, , ,