Social Media in Perspective

Lesson #19--SOCIAL MEDIA IN PERSPECTIVE

Welcome, once again, to our Internet Income Course. This is lesson nineteen aimed at bringing out the ins and outs of starting and running a profitable online business in today's global market by breaking down important principles using simple English. Course author, George Little, continues to reveal tips, real-world advice, and in-depth, step-by-step instructions on setting up your Internet-based business. Read the previous 18th lesson here.

WHAT YOU WILL LEARN
In this lesson, we will discuss the role that Social Media Marketing plays in your overall marketing strategy. We will compare Social Media Marketing to Search Marketing. We will discuss how you can track and measure the results you achieve with Social Media Marketing. We will also distinguish between using social media for free and buying social media promotion. The first part of this lesson discusses paid promotion. After that, we will discuss how you can use social media to your advantage without purchasing exposure or ads.

Putting Social Media Marketing Into Perspective

There are two major types of paid online marketing today: paid Search Marketing and paid Social Media Marketing. Search Marketing involves bidding on keywords with the goal of your page being included in the paid ads resulting from a search that used the keyword or key phrase you chose. Social Media marketing involves paying a social media site to display your posts or your ads in the timelines or newsfeeds of targeted users. There has been much written about which is better. But, rather than trying to determine which is better, it is more productive to understand that both have their place. Each performs somewhat differently.

People tend to use the search engines when they are searching for specific products or services. It has been reported that 61% of consumers use search engines to help them in product research before making a purchase. There has been much research on how people search and this information is available to you (ex: Google Adwords Keyword Planner) to help you choose the right keywords to reach your target audience. Social media, on the other hand, is not good for searching. Social Media, from the consumers point of view, is more about seeing what appears before you than finding what you want to see with a search.

In Social Media Marketing's favor, it has also been reported that 75% of people in the 18-26 age group use recommendations on social sites in product research before making a purchase. Social media marketing has an advantage over search marketing in that social media sites are aware of a user's interests (based on previous interactions) without needing to refer to a particular search or search term. While search marketing only targets individual searchers during their private searches, social media is more public. Recommendations easily occur on social media when someone likes, mentions, or tags you or your product page. Their friends on social media, seeing the activity, know that this person is interested in you and your product or service. That will often make them interested as well. Plus, Social Media also allows you to see and immediately respond to objections or criticism about your business, product, or service. You are not directly aware of these reactions with Search Marketing. Social Media also works very well on mobile devices.

You should use search marketing to catch those searching in real time for a specific product or service. You should use social media marketing to cast a broader net, strengthening your brand and catching those with a need, although not currently searching.

Targeting Options

Because social media sites gather so much personal information, it is possible to use deeper targeting based upon more factors than with other advertising methods. Connection targeting allows you to limit your ad displays to those persons who have a connection with your page or a connection with a common page. Behavior targeting can narrow your ad to just those who have engaged in certain online behaviors such as past purchasing, expression of intent to purchase, or use of specific devices or apps. Interest targeting allows you to limit your ad displays just to those who have expressed or demonstrated a particular interest. You can use lookalike targeting, which targets those people who resemble (by interests, behavior, or connection, etc.) known customers. You can also use custom targeting, picking the specific people to target based on your own analysis.

Tracking

Social media is not a one time event. It is a long-term commitment to add value to your brand. Nevertheless, you should attempt to define and measure the results you seek from social media just as you would for any advertising campaign.

You can measure the value of enhancement to your brand by the number of likes or followers you acquire. Utilizing tracking code provided by some of the major social media sites, you can track other specific behavior as well. You can use ads designed to influence users to take specific actions such as buying your product, signing up for a list, or registering for an event. The social media sites provide conversion tracking code that you can place on your own website or blog where the action will take place. This code will inform the social media site of the action taken on your page. With this information, you can track the success of your ad with the tracking tools also made available by the site.

Analyzing Your Tracking Data

To learn some of the techniques and formulas used to evaluate the cost effectiveness of advertising, take a look back at Lessons 56 and 57 in the Internet Income Archive. The concepts you should use to evaluate the cost effectiveness of your social media marketing are essentially the same.

First, you need to quantify the value to you of the result you are seeking. Then, you need to determine a way to measure your results. There is much controversy in the current literature surrounding how to value social media results. Some say there is great value to having a large number of followers. Others say that no matter how many followers you have, they have no (or even negative) value unless you can show how much they increase your revenue. The truth is, like anything else, it can be made complicated or it can be made simple depending on how you approach it. By applying some common sense, it can become manageable. While I am aware of some factors preventing it from being absolutely true in all cases, common sense does tell me that in general, other factors being equal, you increase the value of your brand by increasing your number of followers. Determining how much you increase the value of your brand by increasing the number of your followers does become an interesting question, however.

Those that say it may have no (or even negative) value to increase the number of followers insist that you must devise a way to track the percentage of your followers who actually result in a conversion. (Recall that a "conversion" occurs when someone takes a positive action such as registering or purchasing.) They argue that until you can demonstrate mathematically that the the value of conversions achieved through social media connections exceeds the cost of obtaining those connections, you do not have a return on investment (ROI). Its my opinion that, while that analysis may apply to very large corporations, it doesn't necessarily apply to independent entrepreneurs--especially those just starting out.

If you are a small business, especially if you are just starting out, using the number of followers obtained on social media is a good measure of your success. Whether or not it results in immediate sales, it provides you a foothold. It gets you out there. It gets you connected. But, you still have to track and value as best you can even in this situation. If for no other purpose, it will be the start of a data collection that will be very helpful to you in the future.

You can quantify the value of followers by asking yourself what it would be worth to have x number of followers. Determine a monetary value for that level of brand awareness and then divide that value by the number of followers needed to obtain that level of brand awareness. This will give you a good estimate of the value of each follower. If you have to spend much more per follower than the value you receive from each follower (according to the above formula), you are not being cost effective. If the value you receive is greater than what you are spending to achieve it, you are being effective.

In my opinion, 10,000 followers give you a good, solid, starting point for success. Ultimately, you would like to have hundreds of thousands, hopefully even a million or more, but that will not be obtained by most. Those numbers are for the big companies and the really popular celebrities. A few independent entrepreneurs break into these large numbers, but not very many have that type of success. As an independent entrepreneur, setting 10,000 followers as your first goal seems to make sense. That number is large enough to give you something to work with to obtain some revenue.

So, the next question is what is 10,000 followers worth. As an independent entrepreneur just starting out, you have to ask yourself what it would be worth to you to have a base from which you could earn some significant revenue. More often, however, the question is controlled from the budget perspective. What can you afford to spend to get those 10,000 followers? Often, given the limited means of tracking and the limited data available to you as you start (from which to determine actual value), you have to redefine the question as follows: "How much can I spend per follower to obtain 10,000 followers and stay within my budget?" Unless you have a very large budget, this is the question that will control how you approach the task, at least at first.

If, for example, you have a $500 budget for brand awareness, then you have only $500 to spend to obtain your goal of 10,000 followers. To achieve your goal within your budget, you cannot spend more that $.05 per follower on average. With this information, you can track how well you are doing. If you are spending $.10 per follower, you will fall short of your goal. If you are spending $.025 per follower, you will exceed your goal.

But, you need to be aware that by using this approach you are putting the cart before the horse. This approach makes no sense unless there is ultimately some way to verify that 10,000 followers is worth the $500. To make this determination, you have to use the same approach as the larger companies. You have to track your conversions. You have to know the value of each conversion. You have to ascertain whether 10,000 followers on social media will result in the number of conversions necessary to put you at a comfortable level of profit. The difficulty for new independent entrepreneurs is that they have not yet collected the data necessary to make these determinations. It takes time and sales to collect this data. It also takes the right tracking tools.

You want to study the tracking tools available on the social media sites that you use and get those tools in place as early as you can. As you become successful, you will need the data resulting from this tracking to guide you to even greater success. You may not know until after the fact whether the 10,000 followers was worth the $500 you spent. But, before you attempt to move to the 20,000 followers level, you will have some data to make that determination. You can constantly increase your knowledge of the cost and value involved as you gain experience and success. Ultimately, you will be able to measure the percentage of conversions that come from each social media site, value the conversions, and calculate with precise accuracy the value of each follower--the ultimate contribution per average follower to your bottom line return on investment.

Free Social Media

Many new entrepreneurs starting out do not have $500 to invest in social media. Those that do may not yet have the confidence to invest that much money in something new to them. The good news about social media is that you can also use it for free. You can gain followers at no cost other than the time you take to make interesting posts that capture their attention. You can create a personal profile and a large number of brand profiles on social media without any charge. You can gain followers for these profiles without spending any money.

Social media sites make their money by charging you to promote your brand pages. Thus, you can expect that they won't make it entirely easy for you to promote your profiles on your own--and, they don't. They limit the number of exposures brand page posts receive and request you to pay for larger exposure. Nevertheless, it is still possible to obtain a large number of followers without buying paid promotion.

To be successful in promoting your brand profile without cost, you will need very interesting posts. You must learn the ins and outs of social media. One successful approach is to work first to increase the number of followers of your personal profile. Then, make posts and recommendations on your personal profile to increase the likes for your brand profile.

Using social media for free gives you an opportunity to learn the ropes before you make an investment. You can employ the techniques you learn using free social media to your paid promotions down the road. Thus, free social media is a good way for many to get started.

CONCLUSION
You should use search marketing to catch those searching in real time for a specific product or service. You should use social media to cast a broader net, strengthening your brand and catching those with a need, although not currently searching. Because social media sites gather so much personal information, it is possible to use deeper targeting based upon more factors than with other advertising methods. You can target by connection tracking, behavior targeting, interest targeting, lookalike targeting, or custom targeting. You should attempt to define and measure the results you seek from social media just as you would for any advertising campaign. You can measure the value of enhancement to your brand by the number of likes or followers you acquire. Utilizing tracking code provided by some of the major social media sites, you can track other specific behavior as well. You should install tracking code on your personal site as soon as you can in order to build the data that will be helpful to you as you grow your business. Although you will not have enough data in the beginning, ultimately your goal is to accurately measure the return on your investment in social media marketing.

You can also build your brand with social media without using paid promotion. This is a good way for many beginners to learn the ropes of social media before investing in paid promotion.

WHAT'S COMING NEXT
In our next lesson, we will continue our discussion of social media. Read the next lesson here: Learning By Example How Social Media Promotion Works.

Author
By George Little, Panhandle On-Line, Inc. For more information on the Internet Income Course and other works and courses by George Little, see http://www.profitpropulsion.com

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