Dear Dan: My young nephew just started a business and says he's been promoting it successfully in different "social media" online. Is exploring social media as a marketing tool really worth the bother? - Social Wonderer
Dear Social Wonderer: In today's stomach-wrenching economy, more businesses than ever before are finding ways to build their customer base and boost revenues -- even while slashing their ad spending. What's their magic recipe for success in the face of financial adversity?
Just this: Social media. But what does that really mean? "Social media" include all of the Internet-based sites, tools and services where people - and businesses - talk to one another, network, trade ideas, collaborate, listen or just "hang out." This includes sites such as Facebook, YouTube, LinkedIn, Digg and Twitter, along with blogs, podcasts, webcasts and thousands of message boards and social network sites of infinite variety.
The fastest-growing businesses have been some of the first to adopt social media marketing as a business strategy. In 2007, for example, about 20 percent of the Inc. 500 fastest-growing private U.S. businesses had their own blog. Now that figure had doubled to nearly 40 percent and is headed higher all the time. Given the current economic climate, social media are important tools that businesses are trying out at a rapid rate.
In the next 12 months alone, the number of small businesses diving deeply into social networking services is expected to double, according to AMI Partners, a New York-based small business research firm. "Social media are shaking up the marketing mix, and transforming the Internet from a one-way to a two-way information highway," says Laurie McCabe, VP at AMI. "Through blogs, message boards, videos and other social media, anyone can tell everyone what they think about a vendor's products, services - or anything else."
Seeing this trend, the social networking websites themselves are beginning to offer services specifically targeted to business users.
Innovative use of social media earned Wiggly Wigglers, a small natural gardening mail order business in rural England, a Dell Small Business Excellence Award - and $50,000 worth of technology. By using social media to connect with current customers and reach new ones, Wiggly Wigglers built its base to over 90,000 customers worldwide, and cut its advertising budget by 80 percent.
The small company's Facebook page boasts thousands of "fans" who trade ideas on 170 gardening-related topics. Wiggly Wigglers hosted 50 weekly podcasts from the "Wiggly sofa" reaching thousands of listeners, and readers of the San Francisco Chronicle newspaper rated it their favorite gardening podcast.
Getting Started in Social Media
Despite its growing popularity, the world of social media remains a mystery to the vast majority of businesses in the U.S., and especially the smaller ones. Only a tiny fraction use social media for business purposes. But with the Wiggly Wigglers of the world leading the way, that's changing.
To help small businesses learn about and use social media tools, Dell recently created an excellent series of "Social Media Guides"on Facebook. Click on any of the titles to read or download the guides; watch the introductory video; and join the discussion board. The tips and advice on getting started, along with best practices, are the perfect starting place for any business owner who wants to give social media a go.
Dell has also dug up some interesting examples of small biz success in social media. Pinder, a small web-based business that sells laptop bags and cases, has worked successfully with bloggers to generate buzz for its products. By listening to what potential customers were saying online, the company found an influential blogger with a passion for laptop accessories. Pinder sent her a sample laptop sleeve that she reviewed on her blog, sending Pinder's sales up 30 percent.
Gary Vaynerchuk took over his family business, a liquor store in New Jersey, at a young age. In 2006 he launched Wine Library TV, a daily video blog in which he reviews wines. To extend his reach, he now uses several social media strategies, including Twitter. Gary "tweets" (which is what you do on Twitter) daily about wine and other topics, and has attracted nearly 15,000 followers in the process.