Will you buy something that was recommended to you on Twitter?
The thing is, I wouldn’t even buy something that one of my best friends recommends to me. But maybe I am not the sort of person who would be susceptible to any of my friend’s recommendations or perhaps it’s because my best friend always ends his recommendations with a disclaimer — “check it out for yourself man, don’t take my word for it.”
Maybe I am actually confessing to be a caveman when it comes to buying on the sole basis of a recommendation I come across online. Or maybe I don’t really fully understand how “online conversation” can lead to an actual sale.
The patently dishonest hype, if you will, surrounding the social media marketing buzz around the world is that the repeated and frequent mention of your brand on Twitter and Facebook can ultimately lead to rip-roaring, laugh-like-a-maniac-wall-the-way-to-the-bank sale.
It won’t. Not immediately, magically, or miraculously. Especially NOT just because it’s on Twitter or Facebook or a blog.
Can you imagine this:
Wife: Honey, I just bought 20 gallons of olive oil mayonnaise.
Husband: WTF!? Why?
Wife: I saw it on Twitter.
With about 200 million people/users/registered accounts using twitter everyday sending out 110 million tweets a day, perhaps the law of averages will kick in at some point and it’ll prove that a substantial number of people buy stuff people recommend to them on Twitter.
Now, I don’t have any reason to doubt that products indeed get moved and money is earned through Facebook. There is proof of it here and here. What I am saying is that there is a smarter way of going about realizing your revenue targets for social media.
First, just imagine applying the Pareto Principle to guess where most of Twitter sales are coming from. The Pareto Principle roughly states:
The 80/20 Rule means that in anything a few (20 percent) are vital and many(80 percent) are trivial. In Pareto’s case it meant 20 percent of the people owned 80 percent of the wealth. [source: http://management.about.com/cs/generalmanagement/a/Pareto081202.htm]
Other sites have applied the Pareto Principle to Twitter and this one is interesting, although I am not sure if it is true:
Metrics firm Nielsen decided to test out if the same applies to Twitter – do 20% of tweeple account for 80% of what takes place on Twitter.
The answer is no. At least in the UK, an even smaller number – 7% – account for 79% of Twitter activity.
Nielsen found that ‘light’ users (less than 2 minutes per month, actually broken across 30 days that is pretty much zero) account for 67% of the audience, medium users (22 mins per month, so still less than a minute a day) account for 26%, while heavy users (1hr+ a month) account for 7% of UK tweeple.
Nielsen’s stats confirm previous ones by Canadian research firm Sysomos, which showed that there is a group of 5% of Twitter power users who are responsible for 75% of Twitter activity. [Source: http://socialmediatoday.com/index.php?q=SMC/177538]
Moreover, a fellow hype-buster, BenignO of Get Real Post cited this interesting bit of information:
On a per audience-minute basis Old Media revenue utterly dwarfs “New Media” revenue.
Facebook currently boasts a user base of 500 million. Being a privately-held company, however, it is mum on its revenue figures. So let us go by the estimated one billion dollars it may have made in 2009. Assume too that the average Facebook user was logged on an average one hour per day. That translates to about 0.009 cents in revenue per audience-minute.
Compare that to the American media network Fox’s Super Bowl franchise which is among the most-viewed content in Old Media. The 3rd February 2008 broadcast of Super Bowl XLII (New York Giants vs. New England Patriots) attracted an estimated 50 million viewers. A thirty-second advertising slot in a Super Bowl broadcast on the average costs about $2 million. That’s about 8 cents in revenue per audience-minute.
In short, compare:
New Media: Facebook requires an audience of 500 million to make 0.009 cents in advertising revenue per minute of air time.
Old Media: Fox requires an audience of 50 million to make 8 solid cents of advertising revenue per minute of air time.
Old Media requires only a tenth of the audience to make 1000 times the revenue of New Media
So, people, what am I really trying to say?
The simple fact of the matter is that, despite the number of people as well as the scale of cash being poured into social media marketing, you still have to be shrewd about it and look at the social media for what it is really worth to you.
Here are a couple of take aways, just off the cuff
ONE. Social Media Marketing, like traditional marketing, is still marketing. It can be a really amazing trick to sell an freezer to an Eskimo, but man, just think of how many Eskimos there are and how much you’d have to spend on that sale. The more sound and more effective way of going about a sale is still finding a problem than needs to be solved. GEOX (my favorite brand) solved the problem of sweaty Europrean feet and guess what? Ding! Ding! Ding! The guy’s rich.
TWO. Social Media is still media, except that it is media that your friends and family control up to a certain degree. If you have ever had a cousin or college buddy who called you up for a “business meeting” out of the blue, believe me it’s the same thing for most of your “prospective” customers that have made contact with “network marketing” or “direct marketing.” You can only count on your friends and family to buy stuff from you once or twice, then after that, the relationship gets strained. If you are going to tap people who have a large influence on conversations on the social web, go the extra mile and check the reactions to the recommendations they made in the past, then see if you can check out how the product or service fared months after the buzz has worn off. If you do decide to hire someone to do social media marketing for you or co-opt some talented individual, make sure you spend money only on the strongest, most systematic, most disciplined, and best contenders then give them all the support they need. And before you write that check for their services, make sure everything is crystal clear — from the concept down to the deliverables. Most social media marketing phails happen when the client makes assumptions based on someone’s reputation.
THREE. If you really want to “engage” people on social media, offer value to the people who really matter and you don’t have to pay some social media expert for any advice. Who are these people? Well, they are the ones who actually bought your product. Imagine the value that social media WOULD have if your company actually kept in touch with them after the sale of your product. Here’s a short anecdote: I was always the biggest kid in my class and I had to get my shoes custom made every school year. Edol, the guy who made my shoes, would either call up my parents to ask how I was getting along with my new shoes. If they didn’t fit right, he’d practically order my Mom or Dad to bring the shoes in so he can make adjustments. And I’ll tell you, Ed0ls made me two pairs of shows every year for 15 years — the damned things cost more than shoes you could buy in any department store.