The Evolution of Social Media as a Marketing Tool for Entrepreneurs

Article excerpt

INTRODUCTION

Entrepreneurs face many daunting tasks in the operation of their businesses, not the least of which is maximizing the marketing potential of social media while at the same time being able to measure cost benefits. According to the 2011 Q3 Nielsen State of the Media: The Social Media Report (NMincite, 2011), "60 percent of people who use three or more digital means of research for product purchases learned about a specific brand or retailer from a social networking site" (para. 1). This statistic, and a host of others, serves to prove that tried and true social networking sites like Twitter, Facebook, Foursquare, LinkedIn, and newcomers Google+ and Tumblr are here to stay. Furthermore, they are influencing the way consumers buy products and services. To encourage business owners, large and small alike, to use social media as a marketing platform, several social media companies have developed business-specific tools or made it possible to brand an online profile to a business.

The number one deterrent of social media for small business has always been the time commitment required to keep profiles active and the almost impossible task of calculating the return on investment (ROI). Advances in the social media scene like Hootsuite, a social media dashboard and scheduler, allows scheduling and posting content to all online profiles simultaneously. Facebook Pages Insights, which allows tracking the number of visitors to a Facebook Business Page, helps close the gap between big brand experts (i.e., Coke and Apple) and average mom and pop businesses at leveraging social media.

INTERNET GROWTH AND CURRENT SMALL BUSINESS SOCIAL MEDIA LANDSCAPE

In 1995 statistics indicated 0.4% of the world population used the Internet. The latest figures show that number has grown to 32.7% or some 2.2 billion users (Internet World Stats, 2012). With this incredibly fast evolution of the Internet and social media, it is evident from everyday media that big businesses are making use of every social media outlet available today; but are small businesses doing the same? An industry study in 2011 published in the Social Media Examiner surveyed 3,342 marketers, and just under half of those were self-employed or small business owners (Stelzner, 2011). The results of that survey are summarized below:

* Overall, 90% of the marketers surveyed agreed with the statement "Is social media important to your business?" and 66% of small business owners strongly agreed with the statement.

* 80% of marketers indicated social media use generated more exposure for their business.

* An increase in search engine rankings was seen by almost two-thirds of marketers.

* Spending as little as six hours weekly generated leads for 52% of marketers, with small business owners more likely to strongly agree to the lead generation question.

* 59% of small business owners saw a reduction in marketing costs when social media were implemented.

* Facebook, Twitter, LinkedIn, and blogs dominated usage stats, with 92%, 84%, 71%, and 68% respectively, with 78% of small business owners indicating they were more likely to use LinkedIn.

APPROACHES USED TO DEFINE AND MEASURE SOCIAL MEDIA ROI

While some social media strategies, such as offering Facebook- or Twitter-specific deals and coupons, can be directly traced to a traditional form of ROI like generating a sale, it is important to note that other facets of social media interaction also constitute ROI and can be important indicators of the health of a social media campaign. As Gangemi (2011) of Fox Business says:

It's no secret that for marketers--particularly small business marketers-- that social media is now the price of admission to reach a mass audience. Not to mention its impact is more measurable than just about any other marketing technique: The number of re-tweets, clicks and mentions that content receives online are the new ways to measure success (para. …