With the plethora of social media resources today, the challenge isn’t should your company be in social media. The challenge is how much of your company’s time should you devote to social media and which platform should you use to reach your target customer.
No one is an expert on social media, and I am finding the more I think about using it, the more I go back to bedrock principles learned in microeconomic courses from business school. Things like network effects become huge issues. Knowing the ins and outs of the VHS/Betamax case can be applied to social media platforms today. The reason no one is “expert” is that it is too new. There are social media platforms that were started in the last three years that haven’t reached critical mass yet. They will cause us to engage differently than today. It’s a rapidly evolving ecosystem.
However, there are some platforms that seem like they are stable enough to say they will be around for the long haul. Facebook ($FB), Twitter, LinkedIN($LNKD) and now Pinterest feel like they have such a head of steam they will dominate. Google ($GOOG) has acquired some powerful social media resources, like YouTube so they are in the mix. And don’t forget about the original social media platforms; email and blogs.
When forming a social media strategy, the first thing to do is not look at the platforms and decide which ones to use. The first thing to do is the traditional strategy work the firm should always engage in. Figure out who your target customer is and why, then think about the things that motivate them. This is just traditional SWOT analysis taught in marketing classes since Jon Kovler first started identifying these things.
Once you have the basic strategy down, it’s time to look at the benefits and limitations of each of the tools. While social media is “free”, there is also a lot of noise. It’s hard to punch through that noise and the firm will have to be creative and tenacious in order to do it. The firm will also have to be very flexible. Once customers start talking and identifying what they want-the firm will have to listen and execute. If it’s unable to find a way to execute customer demands in the way it presently is structured-it should find out if those are one off demands or if they are a real trend the company can ride to make impact on earnings.
For example, say you were a car company and you offered a line of colors for a car. A couple of people tell you on Facebook they want an oddball color for their car, chartreuse. Just because you get a smattering of people that want it doesn’t mean you ought to offer it. That depends on the cost of changing operations to meet their request. The first thing I might do if I were the manufacturer is engage them and ask how much they’d be willing to pay to get that color. That would give me a sense of demand. The next thing I might do is organize a few contests to pick the next color of the car and see how many people engaged in it and where they were from. Maybe chartreuse is just a big color in California. I might offer it strictly to California dealers as an pay for option.
Failure to utilize social media effectively, and to understand its limitations could lead your business down a lot of blind alleys. Blind alleys burn working capital-even when the resource is free. If you do nothing at all with social media from an aggressive marketing standpoint, the best thing you can do is utilize it as a listening device to take in information about your customers and competitors.
Each social media platform is used to engage customers in a different way. They also each attract a different kind of person. The active LinkedIN person is going to be different than the active YouTube person. It’s mission critical for companies to stick to traditional forms of analysis, then apply that analysis to the correct mix of social media strategy to bring about a cohesive marketing solution.