Six Pixels of Separation - The Blog
April 19, 201312:16 PM

The Failure Of Social Media

Social Media doesn't work for the vast majority of small businesses.

That was the main message in the USA Today article titled, Study: Social media a bust for small businesses, published on April 17th, 2013. From the news item: "About 61% of small businesses don't see any return on investment on their social-media activities, according to a survey released Tuesday from Manta, a social network for small businesses. Yet, almost 50% say they've increased their time spent on social media, and only 7% have decreased their time. What businesses are trying to get out of social media: 36% said their goal was to acquire and engage new customers, 19% said to gain leads and referrals, and 17% said to boost awareness. Facebook was most cited as the hardest to maintain social-media platform, according to the survey." There is a big lesson in this data...

What you want from social media may be very different from what it is.

There are a lot of things that I would like advertising to do. I'd like it to result in more sales, a better quality of customer, more brand loyalty and - if at all possible - I'd like it to cure cancer. There needs to be a much stronger education and alignment when it comes to media (social media, traditional media or whatever) and expectations. The education phase will help businesses (of all kind) better understand what the channels can actually do to augment their sales, marketing and communications. Once the business understands the capabilities, they can best define how these media properties can help them achieve their business goals (or how to best align marketing with the overall business strategy). Once that hard work is done, a plan needs to be hatched about measurement, metrics and results. Typically this will include work like:

  1. Fix a budget. How much money are you willing to spend against your marketing and communications. Too many small businesses (and medium and large businesses) will often come back with, "I don't know what will it cost?" this is not an acceptable answer. It may not be easy to define a budget (work is never easy), but as the business owner, only you can decide how much you are willing to venture in the marketing realm.
  2. Commit to time served. This used to be a simpler process. Brands could run a small campaign or do something around the holiday season. Social media is much more about opening a line of communication (like having a phone number or physical address). This is basic and elementary, but too many brands expect immediate results and don't commit to it in the same way that they have committed to things like their overall vision and goals for the business. When people ask me how much time they should commit to social media, I often ask them about how much time they are willing to commit to the overall success of their business? Why? Social media shouldn't be another activity in business, it should be a part of how the business flows.
  3. Defining the target market. This is way less about demographics and psychographics and much more about where your best customers gather. Where do they learn, read, grow and share. What excited them, how do they connect with brands and why do they connect with brands? When you can understand where the consumer "lives" online, you can better how understand how to best serve them.
  4. Understand the media channels. Once you have defined where they live, what are these environments and how can you best use them to better connect? "They're on Facebook, so how do I sell to them on Facebook?," is the worst strategic place to start. Instead, ask yourself this: "if they're on Facebook and, on average, they are connected to about 200 people, how can I create value or connections there that would engender my brand to be a part of their very close knit group?"
  5. Identifying the lifetime value of a customer. What is a customer worth? Not an impression, not if they buy once, but the full lifetime value. It's somewhat disheartening to see how few brand professionals actually know the true value of a lifetime customer. One question: if you don't know how much they're worth, how can you figure out what is worth it to acquire them? Complaining that social media doesn't work is a simple cop out.
  6. Lock in a cost per acquisition. Once you have defined a lifetime value dollar to that customer, what are you willing to pay to acquire a customer? Again, marketing goals may be best achieved by using something like Google AdWords over Twitter, but until you have done the hard work of figuring out the math, saying that social media doesn't work is like saying that radio doesn't work or that TV doesn't work. It may, simply, not be working because you're not working to make it truly work.
  7. Create a balanced diet. paid earned and owned. Social media is not unlike other, more traditional, channels in that when it is done well, the paid media can also leverage channels where earned and owned media happens. Paid, earned and owned media are not one-in-the-same. A brochure is not the same as a coupon or promoting that discount on Facebook. Both of the media channels may work in terms of being able to accept the same marketing message, but they don't work the same in terms of how consumers engage, connect and build trust within them.
  8. Execute plans against the diet. Opening up a Facebook page and then being disappointed because nobody is buying from you is not the fault of social media (or Facebook). Once you have defined what you're looking to do in terms of paid, earned and owned media, build a holistic marketing strategy around how you are going to execute against it. Being in social media because a competitor is in social media may be the right impetus to get you motivated, but it's not going to do anything to the economic value of the company unless you get extremely strategic and vigilant in planning what you're going to do, how you're going to do it, what type of voice you're going to use and how you're going to measure it all. 
  9. Start the creative process. Creative isn't just a splashy ad campaign. Creative is the heart and soul of how you various messages come to life. It is the tone, look, feel, voice and consistency of how you execute against the strategy. Great creative concepts can certainly make or break a campaign, so too can great creativity in how you use social media. Quick stunts or a long-term commitment to blogging are creative acts. Just setting up an account and hoping something happens isn't creative at all. Most brands fail in social media because they are homogenous and boring. Understanding what your creative platform is will be critical to finding any modicum of success.
  10. Build a network. Don't hunt for customers... try to build a tribe (hat tip to Seth Godin). The attitude of "I built a page and no one is following," can easily be rebuked by asking these brands: how many people do you follow, how active are you in their platforms and how much value are you adding to them? As with any community, you get out what you put in. And, in the early days, you have to give a lot before you get to receive. Social media plays on the community side of the equation.
  11. Test and iterate. Analytics, measurement, testing little things, learning and optimizing from them are the bane of most marketers. We live in a new world, and it's a constant surprise to see some of the world's biggest brands (and some of the smarter, nimbler ones too) think that the social media model is the same as traditional media (set it and forget it). This is live, it is real-time, it is not (just) push and it involves nuances and dynamics that businesses have yet to understand and effectively flex.

Don't kid yourself, social media works. In fact, all media works... you just have to do the hard work of figuring out how to make it work for you. There are no silver bullets.

By Mitch Joel


Comments Comments Feed
  • Posted by Ken Mueller
    Mitch Joel

    A-men. If it's not working, then I'm in trouble. It works for me. It works for my clients. You just have to have the right mindset, the right goals, the right approach.

    Reply
  • I read the reference article and wasn't at all surprised by the survey results.
    Your post should be the home page on every mobile of every consultant/strategist/agency.

    "What you want from social media may be very different from what it is."

    Educating clients about what social media is and what it can do in the context of the client's business is hard. And because it's hard and because most agencies and consultants are in the business of selling and not educating, it's easier to sell tactics and
    set strategies that resemble what clients are most familiar with - advertising.

    The analogy to social media being phone line or physical address is great because brands need to understand that while the media may change over time, once adopted, social needs to be intrinsically woven into the brand's culture.

    We are so at the beginning of this wave. (as much as many in the space suffer social fatigue.)
    thanks.

    Reply
  • Posted by Don Roy
    Mitch Joel

    Great article, Mitch. I, too was puzzled by the mixed signals of social media being ineffective yet small biz owners are spending more time on it. Social media can work for small businesses, but the scope of use and resources available will obviously be less than their corporate counterparts. You hit on the key to success: know your target market. And, given who they are, which social networking sites are best for connecting with them? Those considerations can be made whether you have a shoestring marketing budget or a dedicated SMM staff.

    Reply
  • Posted by Kemi
    Mitch Joel

    Very interesting article, just setting up in business & plan to use a lot of social media for promoting the business. Knowing how to go about it is certainly useful! Seems it requires a lot of input though. Larger companies I suppose have the resources required including trained personnel to dedicate to social media! This might be one reason why smbs are not getting the full impact of social media especially with the demands from other aspects of business.

    Reply
  • Posted by Anna Wells
    Mitch Joel

    Mitch
    You've articulated the core issue with any media marketing strategy and that is constantly reviewing and adjusting for 'real time'. Social media by nature of its definition is an actively changing dynamic and 'set it and forget' will never result in the preferred KPIs and desired outcomes. The same is true with other mediums today as well- gone are the days of Mad Men advertising. However for SMB owners they have the opportunity to compete with the big corporate ad budgets - why- consumer insight into their customers behaviour and using social media to align with this behaviour is key versus size of their budget. If SMBs really focused on understanding this they can achieve success without big gun ad budgets - reframing emphasis on a bit more consumer research and who they are targeting is the base from which to build success.

    Reply
  • Posted by Allen Roberts
    Mitch Joel

    Mitch, This is a great post, wish I had written it.
    I work with small businesses, many of them run by my chronological peers, many of whom still think that Facebook is all social media is about, but that is where their children/grandchildren post inappropriate photos, so how could it be of value to them.
    You nailed the issues I come across every day.
    Cheers Allen.

    Reply
  • Posted by Eric Ungs
    Mitch Joel


    Mitch, I Love you... Or maybe I just love your thinking :)

    Small businesses are spending more time in social because social is all they hear, it's the hype, so I must be there. The more time I spend there the more rewarding. But, we all know this is absolutely wrong.

    This is what boggles my mind about small businesses. Because I genuinely think that the SMBs have the best opportunity within social. I truly think the smaller the operation the better the opportunity because most likely it will be the owner or the founder of the organization manning these channels. And when this occurs it's the closest voice to use when speaking about the organizations purpose. It's coming from the most genuine source. Purpose is what will drive that brand in the space. Social for an SMB is more intimate and establishes much deeper connections with more of their customers.

    I think it comes down to this; is the main role of the social space to generate new leads and prospects or to nurture relationships with your existing customers identifying your brand advocates allowing them to find you new leads and prospects?

    Excellent as always Mitch!

    Reply
  • Mitch Joel

    Becoming successful in Social Media takes a lot of time, effort and resources. But with the right strategies, there is no doubt that you could gain a very fruitful outcome this campaign. The bottom line here is that you must learn how to wait and be consistent in your campaign. Don't quit too soon.

    Reply
  • Posted by George
    Mitch Joel

    Social media marketing is an area which seems to divide businesses. Some companies embrace it, invest in it, and generate fabulous returns from it, whilst other businesses are pensive, scared and unwilling to get online and start competing via social.
    Trying to catch up a thought leader is a virtually impossible task, after all. But, some are still unwilling to invest in social media. There are also those companies getting online and making a hash of it, then claiming social media marketing doesn’t work for them – even though, with the right guidance, their products and services could have successfully been marketed via social media engagement.
    buying stocks Miami Florida

    Reply
  • Posted by Mark
    Mitch Joel

    Mitch,

    I think one of the biggest failures (problems) with social media is that many so called social media gurus aren't doing what you've detailed.

    In that sense they have failed to create any value for the client. That is their failing and the industries failing, not the clients.

    The situation isn't helped when they start screaming it's not about the money whenever they are pressed on social media's effectiveness.

    This shows that they are clueless about business. The social media industry needs to mature and get professional about what it does and what it offers.

    Also, it is not up to the client to get educated about social media; most of them already know what it is.

    The only reason a business or a client ever engages someone is to get a result, period. If you don't get a result, they won't keep you on. It's not personal it's just business, they are not running a charity or kindergarten for social media wannabees.

    Reply
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