Overview of Social Media Marketing

Often marketers are criticized for ignoring the digital media and relying too much on the traditional media like print and television. With almost 20% penetration of internet globally and close to 80% in developed world, there is a case to reach the consumers in a more cost effective way. However, most of the top and middle management of any company is digital immigrant and not digital natives (anybody born after 1990 -A digital native is a person for whom digital technologies already existed when they were born) which means that most of the decision makers are still  not comfortable with the digital medium. I would argue that in any organization with consumer products, it is not only the marketing department but also the other departments that should take advantage of the digital medium in increasing their effectiveness.

What is Social Media Marketing?

Social Media is the term used to describe the social networks, blogs and other online conversational media. Social Media Marketing is to utilize the social media for marketing, sales, public relations (PR) and customer service. Social Media Marketing and Digital Marketing are often used interchangeably though in strict terms Social Media is a sub-set of Digital Media. Sometimes, many people confuse social media with social networking sites. I would like to clarify here that social media is any conversational media, including blogs on the internet.

Why Social Media Marketing?

Some of the usage statistics of internet are staggering like there are over 1.5 billion users of internet across the globe. There are over 200 million blogs, over 400 million users of Facebook (by the way, Facebook replaced Google as the most visited site last month in the US), 50 million users of Twitter, etc. The short video below explains how big is the internet as a medium now

The staggering number of conversations on the social media can provide wealth of information to any company or to any function within a company. In order to illustrate my point, I did a search on Blackberry on Twitter and was myself surprised to get the wealth of information for different functions of RIM (makers of Blackberry). In the figure below, I have indicated which function can use which tweet:

It can be seen in the above image that just following the Twitter conversations provides opportunities for any company to connect directly with the users. Any negative publicity can be converted into a positive publicity if the problem is attended to proactively. There are opportunity not only for customer service also for sales and product development. The product development department of RIM should try to conduct a market research to find out if other users also are complaining about the track ball. The company specific information is available somewhere in the cloud and now it depends on the companies to either take advantage of it or ignore it.

A survey from eMarketing (refer figure below) shows that most of the marketers view social media as a tool to engage customers.

The above chart gives great insights into the advantages of social media marketing. However, I do not agree with Customer Service getting the last spot. In my view customer service should be the most important aspect of benefits of social media as it would lead to better customer satisfaction and would help spread the positive word of mouth. Another advantage that is not listed in the chart is the fact that digital marketing is much more measurable than the traditional form of marketing. It is possible to measure the reach as well as the lead generation.

Social media marketing is highly cost effective as the money needs to be spent only on the bought media. The own media (company websites) and the social media is free and hence the total cost of promotion on digital media is much lower than the traditional media. The amazing video below from Eric Qualman vividly illustrates the economics behind social media marketing.

Can companies afford to ignore the Social Media?

It would be a big mistake if any company feels that it can afford to ignore the social media. With social media, the companies are under continuous scrutiny by its current and potential consumers. United Airlines learnt its lesson the hard way when one of its customers loaded a video on You Tube on damage to his “Taylor Guitar” due to mishandling by United Airlines. The hilarious video became a huge hit and finally United Airlines had to pay not only the compensation but also it took a huge hit to its image. Enjoy the video – it is worth the time.

This post has been written with inputs from Deepak Taneja

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