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Social Media for Business Marketing: Is It Worth the Hype?

Social media for business marketing is the latest technique for companies to gain new customers.

But is it worth all the hype?

We talked to people who use market their business with social media every day, as well as asking experts in the field about what works – and what doesn’t work. Here are some of their thoughts on social media for business marketing, and their best social media marketing tips:

One of the big advantages to using social media to promote your business is the cost – or lack thereof, says Phil Bowyer, author of “Social Media For Small Businesses” and creator of Phibble Media. Traditional advertising is expensive, he notes, and its effectiveness can be hit or miss. Social media is not just free, he says, but it allows businesses to “mingle” with current and future customers to build a lifelong customer base. However, while using social media to promote your business is techically free, it does entail a cost in “time and patience,” Bowyer says.

So what can you sell using social media tools? Jason Falls, industry observer, consultant and speaker at SocialMediaExplorer.com, says that anything can sell well and be promoted through the medium. He says the “difference maker” is not social media itself, but the story you’re telling about your product or service. Since social media is about conversations between companies and customers, Falls says, the businesses that do best with social media are typically those with “customer-first attitudes and connection points.”

Mike Michalowicz, e-marketing expert and author of “The Toilet Paper Entrepreneur,” writes about small business for the Wall Street Journal. He says that the things that sell best on social media are the “social media training” and “social media promotion” offerings, comparing it to people on TV saying they can teach you the secrets of wealth by selling “how to get rich” systems. On the other hand, Michalowicz says that “tangible items” – things that need to be looked at, touched, smelled, etc. don’t do well on social media, although they do better on websites where the visual and audio senses can be engaged.

One company has created a way to track the value of social media for business. ForeSee Results has come up with a Social Media Value Calculation to determine exactly how much traffic companies can get from using social media to promote your business. Larry Freed, President and CEO of the company, says that the value of social media “differs a lot from company to company” in both quality and quantity of traffic. For example, some companies get a lot of high quality traffic from social media, he says, and others get a very small amount of very high quality traffic. However, other companies aren’t seeing such a good return on investment. Right now, the company has discovered that just 5% of U.S. sales are driven by social media, but that is expected to increase in the near future as the medium grows in popularity.

So how do you achieve a good ROI with social media for business marketing? And what are some good social media marketing tips? Bowyer emphasized conversations with your potential customers, rather than incessant promotion of your product. You wouldn’t just show up at a party and start yelling “I have a widget that’s really cool, and each one you should buy it,” he says. You would talk to people and ask them about themselves. Keep that in mind with using social media to promote your business, Bowyer says. “Have conversations and you’ll win.”

Falls said social media is “more about service and story than product.” He suggested approaching social media “with a strategic focus.” Freed shared similar sentiments, saying that “the trick is developing a social media presence that gives your customers what they want, not just what you think they want.”

Michalowicz stressed the importance of “transparency and authenticity.” Forget about the idea of faking it until you make it anymore, he said, because if you’re not real, you will get exposed in the blink of an eye. He said the key is to be “authentically you.” Use the same sort of voice you would use in emails to your friends, the entrepreneur sad, and your followers will become “your new best friends, in effect.”

While he uses humor a lot in his social media persona – even his auto-respond Twitter message is funny — Michalowicz doesn’t recommend that approach for everyone. “If you are naturally a jokester, then do that,” he says, but it has to be who you really are. Don’t fake a funny persona if that’s not you. People can spot a phony from a mile away, he notes. “And if they feel they can’t trust your style, they will also feel they can’t trust you.”

Bowyer said people shouldn’t be afraid to change their strategy if it doesn’t work. And don’t worry about being perfect, he said. “It’s the rough edges that give you character and appeal.”

And don’t forget about using blogs to hone your strategy; as one of his social media marketing tips, Falls exhorts using a blog as a “social media hub” and a magnet for search engines.

Where do you find customers on social media? Almost everyone we spoke with agreed that Facebook should be an important part of any social media for business strategy, due to the size of the audience. Freed said his company’s research has determined that not only is Facebook “the best site to target,” but that their study shows that customers are happier with companies’ Facebook sites than they are with Facebook itself. Michalowicz prefers Facebook to Twitter when it comes to having a dialogue with your customers, although he said Twitter works well at “striking curiosity” and starting that dialogue.

Besides Facebook, where else is a good place to find customers? Falls says you need to figure out where your audience is. But determining that “isn’t always easy-peasy,” he says. You can do surveys or spend money on market research to tell you. Even if you just start out with just anecdotal information, “fish where the fish are,” Falls says.

Bowyer, who works with musicians in his business, said that YouTube is supplanting MySpace as the place to find new music. YouTube is “becoming this generation’s version of MTV,” he said. He notes that those who are marketing to teens should stay away from Twitter, due to the low teenage use of the program.

Besides the big name sites like Twitter and Facebook, there are also many niche social media sites to check out. Falls recommends LikeBusiness.com and LinkedIn for business-to-business (B2B) marketing. He suggested Trip Advisor for travel businesses, UrbanSpoon and Yelp for restaurants, and recommended that retailers target tracking sites FourSquare, GoWalla and Whrrl. Bowyer also suggested FourSquare for local companies to promote their locations.

Bowyer also works with authors, and suggested using sites like GoodReads to promote their work, Scribd to show their work, and Amazon, Barnes and Noble, and Smashwords to sell their work.

Most experts agreed that you have to have a “strategic focus,” as Falls puts it, around your social media for business efforts, instead of incorporating it willy-nilly. Bowyer emphasizes that you should “set your goals first, then decide how social media can help you reach them.”

And all agree that putting in the effort in social media for business is worth the time. For example, Selma Avdicevic, founder & owner of Woolly Boo, a company that makes handcrafted children’s bedding made of natural fibers, is one of the social media for business success stories. She has used social media like Facebook, Martha Stewart’s Dreamers Into Doers community, and LinkedIn to grow her business. And she says that the week she joined Twitter “was the week of record sales to date.”

Bowyer uses social media to create interest in his artists’ works. And Michalowicz has built his own online community of sorts by asking readers to contribute ideas to his ToiletPaperEntrepreneur.com site.

Freed says that social media’s influence should continue to be on the rise, “both as a direct driver of traffic and sales and as an influencer or amplifier.” So don’t be afraid to use it for your business.

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