Roughly 80 million people, or 41 percent of the U.S. Internet user population, visited social network sites at least once a month in 2008 according to eMarketer. However, 75 percent of marketers report in a recent Forrester survey that their social media budget was under $100,000. Given the size of the social media audience, why are marketers spending so little?
First, social media tools are relatively inexpensive. Many marketers believe they can cheaply implement a social media campaign. This overlooks the costs of related personnel, marketing support, and other internal resources that may come from other budgets.
Secondly, visitors mainly go to social media sites to socialize, not to consume content in the traditional sense. Social media users are focused on their personal goal of connecting with others, so it isn’t surprising that a one-size-fits-all paid advertising approach doesn’t yield great results.
That said, social media sites, when used effectively, can be powerful advertising media to drive measurable marketing results.
For example, CTRs (define) on Spiceworks, a professional IT niche community, can range from 2 percent to 20 percent in specialized community topics compared with industry averages of 0.1 percent to 0.3 percent for standard banner ads according to Jay Hallberg, marketing vice president and cofounder. To leverage social media advertising effectively, Spiceworks works with advertisers (for example, Microsoft and Xerox. As a result, marketers experience two to four times the conversion rates compared to traffic from other sites.
Let’s talk about what it takes to generate such impressive results.
Three Ps of Social Media Advertising
To maximize results on a social media site, it’s critical that advertisers follow these three principals.
- Place message in contextually relevant environment. Particularly in niche social media sites, advertising should be integrated with the site’s content to be relevant. Social media sites generally require members to register, which raises the bar in terms of interest, motivation, and qualification. This puts the marketer’s message in an environment where the user is predisposed to relevant messages. Participants should view your marketing as an extension of the experience and a service rather than something to be avoided.
- Provide something of value to users and their community. While the resource that users or the community receive depends on the social media entity, the goal is to encourage user interaction. As a result, members get to experience the product or an activity related to it. This helps further qualify them as prospects from a marketer’s perspective.
- Participate actively in the community. As with most social media marketing strategies, employees — the public face of the company — must contribute to the community and interact as peers rather than product pushers. This gives prospects and customers someone to reach out to get questions answered, helping to build relationships and sell product. The firm also receives users’ feedback and insights about their offering.
Note: there may be additional benefits from generating social media activity in terms of improving related search results. This depends how the social media site is set up and optimized for search.
Social Media Advertising Meets the Purchase Process
When social media advertising is contextually relevant, gives users value and an incentive to engage, and enables the marketer to be visible and active, it can help support every stage of the purchase process except for the actual purchase. Research shows that blogs deliver better purchase support. Yet, using social media forums effectively by following the three Ps can put the marketer in contact with prospects at critical purchase points and help extend customer knowledge on their terms in a similar way to blogs.
As a result, social media advertising enables marketers to be present when social media forums spark product needs, provides an environment to engage and persuade prospects to purchase, encourages future sales from existing customers, and gives customers a forum to be brand and product advocates.
Social Media Advertising Metrics
Social media advertising provides a wide variety of measures to enable marketers to assess their performance. Among the important factors to monitor are the following:
- Traffic and sales leads. These metrics give you an understanding of the number of people who interact with your product and/or brand. More important is the number of qualified sales leads acquired.
- Click-through and conversion rates. CTRs show how many prospects take an action to the next step in the process; conversion rates show how many of those prospects ultimately buy from your firm.
- Sales. In any marketing campaign, revenues are the major factor in determining your success. The benefit of utilizing a social media environment is that your marketing and sales teams are actively involved throughout the purchase process so that customer relationships can be built and extended.
- Costs. These are an important determinant of marketing effectiveness and need to be tracked so they can be compared to benefits.
- Customer interactions. These indicators can shed light on how prospects feel about your product and competitive products. Among the numbers to track are the number of threads and the number of posts referencing your product, brand, and/or company.
When assessing how to approach social media options, consider the potential for using advertising to leverage the strength of the communities where your prospects congregate. To get full value from your campaign, it must be contextually relevant, gives something of value to the social networkers or community, and requires active participation on your part. If you follow these three principals, social media can be among the highest ROI (define) uses for your marketing dollars.
Marketers create personas to better understand their target audience and what it looks like. If marketers can understand potential buyer behaviors, and where they spend their time online, then content can be targeted more effectively.
What’s behind a successful data-driven marketing strategy?
One of the major challenges in the martech industry is getting the attention of prospects in a world where they are bombarded by content and emails on all sides.
Facebook is addressing one of the biggest missing pieces of its chatbot offering: analytics.