Social networks offer SMBs marketing power

If done correctly, social networking sites can create new avenues and enable small and midsize companies to build "conversations" with customers.

Small and midsize businesses (SMBs) should consider social networks as an extension of their overall marketing communications strategy, but not without first understanding how audiences relate on these new platforms.

Steve Hodgkinson, Melbourne-based research director of Ovum, said social networks offer SMBs a rich and dynamic source of ideas, feedback and interaction with actual and target customers.

Tom Cheong, Cisco Systems' managing director for Singapore and Brunei, described social platforms as "part of the arsenal of tools SMBs have at their disposal when conceptualizing and executing marketing activities".

These networks create new avenues for companies to build "conversations" with customers, Cheong said in an e-mail interview.

Best social practices
Cultivate dialog:
Attract readers on a personal level by acknowledging the importance of their opinions.

Avoid commercialism::
Deliver credible content.

Utilize call and response format:
Use as a tool for information sharing and project sharing.

Expect and accept criticism:
Facilitate an open forum of communication to benefit from the user insight.

Prepare response strategy in advance:
Respond to comments within 24 hours, with custom responses, and follow-up with users as needed.

Respect privacy and personal information:
Allow users to keep chosen information private, especially with social networking sites.

Source: Datacraft

But, he noted that while there are many cost-effective and free social media tools SMBs can use to expand customer relationship, these businesses must first understand how audiences are actively participating on the social platforms.

Hodgkinson explained in an e-mail interview that the most cost-effective way for SMBs to harness the power of social networking is simply to participate in existing networks as members. This will allow the companies to observe the likes and dislikes of network members, their language and behaviors, as well as provide an opportunity for SMBs to observe the competition.

"[Regardless], participation needs to be authentic," the Ovum analyst advised. "Avoid 'snooping' under an alias as this can [result in a backlash on] your brand if you are 'outed' and the network resents the breach of trust."

When the SMB develops the skills to participate in social networks, it can choose to be more proactive by initiating dialogs to test product and service ideas. It can also join discussions on customer needs that were unaddressed or product and service frustrations.

"The golden rule is to be authentic," Hodgkinson noted. "Many social networks tolerate, and even appreciate, the active participation of company representatives on their networks--but only if they play by the rules. The tone of contributions is critical [as] people react very negatively to 'corporate speak' in social networks."

However, since straight advertising on social networks can prove more risky, SMBs need to assess such forms of marketing carefully before embarking on them, he added.

"The trick is to tune into the flow of dialog in a way that addresses the needs and priorities of the network community, rather than the advertising schedule of the company," he explained. "The ultimate expression of the art is to create a viral campaign that builds into its own community of followers."

Monitor, then tweak
Cheong advised SMBs to keep track of what has worked for them when they used social networks for marketing, and to strive to improve or amend initiatives that did not produce desired results.

Esther Quah, director of corporate communications and brand management at Datacraft Asia, said for SMBs to successfully leverage social networks for marketing, they need to provide content that customers find relevant.

"They need to deliver it in a conversational--that is, 'human'--way using terms their customers are familiar with," Quah said in an e-mail interview.

Social networks should not be regarded as just another venue to sell or market products, she stressed. "It's all about people and that's why it's called social media, not marketing media," Quah said.

Just as it is for any other marketing strategy, Hodgkinson urged SMBs that use social networks to determine both opportunities and threats these new platforms present to the company's brand.

"As in all things, you get out of it what you put in," he said, noting that there are thousands of social networks, ranging from general platforms such as Facebook and Ning, to more specialized networks such as the Social Psychology Network or LastFM.

The key, Hodgkinson said, is to understand the different niche communities and their interests by doing background research, for example, via analysis of traffic, search terms, tags, groups, industries and topics. Following that, SMBs should then design focused marketing efforts that achieve a positive outcome in each specific network, he added.

The ultimate aim is to engage the customer in dialog around the SMB's brand, he said.

Choose the right networks
In addition, different social networking sites are better suited for different types of promotional activity, said Ang Chye Hin, Asean director of sales for SonicWall. The security vendor, for example, uploads videos on YouTube and has its own channel on the video-sharing site.

Corporate videos hosted on the site are targeted at SonicWall's channel partners and customers, explaining how they can make best use of the vendor's products, Ang explained in an e-mail interview. Other clips offer best practices and tips on topics such as telecommuting, he added.

"YouTube is free--one only needs to factor in the cost of putting the video together," he said. "They can harness the video-sharing site to educate their audiences in a visual manner, possibly achieving the same type of results as a face-to-face demo offers."

YouTube's comment and feedback function also enables viewers to respond to the videos. Ang said: "We have had viewers offer their thoughts on our products in this manner [so] we can interact with the viewers via this tool."

SMBs will also appreciate the free tracking tools that YouTube's Statistics and Data function provides. This lets an SMB that uploads a video know whether its video is popular and how many other sites have provided links to that video, Ang added.

Facebook and Twitter, too, are useful tools to reach out to customers in a personalized and customized way, or what Ang describes as "one-to-one marketing".

Hodgkinson noted that microblogging site Twitter, serves as a platform for short messages and mainly for promoting links to a Web site.

As for Facebook, Quah said it can be used for publicizing events, press announcements and sharing videos and photos. When used effectively, social media can be a productive marketing channel, she added.

It helps SMBs gain insight on their customers. Despite the availability of customer surveys, she said that some of the most interesting and progressive market research can be found within the social communities where an SMB's customers interact, share information and make recommendations.

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