I presented this talk at the Online Presence seminar organised by .my DOMAINREGISTRY. Please give your feedback in the comments.
If you are running a business, you know that a big portion of your time is spent marketing and promoting your business. The internet is changing all of that and that is what my talk will address today. Specifically I will cover the impact of online marketing–especially social media–on business.
What is Online Marketing?
Let’s begin by defining “online marketing”. To do this, we’ll break this phrase down. “Online” simply means on the internet.
“Marketing” is a little more difficult to define. Many gurus will say marketing is a social and managerial process or something about delivering value but I prefer to define marketing as a profitable relationship between the buyer and seller. For example, I may have something that you want and you are willing to pay for it.
The job of marketers is to form relationships like this where value can be exchanged between the buyer and the seller. Putting it all together, “Online Marketing” is simply the process of making profitable relationships happen on the internet. Today, online marketing spans a wide range of disciplines from banner advertising to search engine optimisation, affiliate marketing and the latest buzzword in marketing–social media marketing.
Social media marketing is currently the darling tactic for marketers. It is more affordable than traditional advertising, it is effective and allows marketers to have a wide reach.
Social media is also great at building relationships because it is social. And it can definitely be used to help create profitable relationships for your business with your customers, i.e. social media marketing.
Social media is particularly useful to small businesses (SMEs) because small businesses tend to nurture relationships with their customers better than big businesses. Just think about your favourite kedai runcit or mamak. Chances are that the employees will recognise you, compared to Tesco or McDonalds.
If you can connect with your customers on a personal level, they will look to you first for a product or solution. For example, if I have a friend who’s a travel agent and I want to go on a holiday, I will contact her first to find out what’s available… and to ask if she has a good deal for me. That is the power of relationships.
Social Media Impact: Social media helps you to build and maintain profitable relationships with your potential and existing customers easier, better and faster.
What is Social Media?
Before we continue our discussion on social media marketing, I think it’s also important to understand what social media is in the first place. (I promise there will be no more theory after this.)
There are two sides of the coin to social media. The first is technology that you may know in the form of blogs, Facebook and Wikipedia. These techologies allow individuals to publish their ideas to the world very quickly and cheaply.
The second part of social media is the social aspect. These technologies are social in the sense that they allow you to connect and have conversations with other people with similar ideas or interests, and form relationships with them over the internet.
And in case you don’t know what a blog or Facebook is, think of social media as a cocktail party on a global scale. At a cocktail party, you may know some of the guests but not all. You can overhear what other people are saying and it’s ok for you to say, “Hi I’d want to introduce myself because I absolutely agree with what you were saying.”
Some of you might be asking yourselves whether it’s worth your time to look for customers through blogs and Facebook. I say yes, and here are some reasons why.
Social Media is Mainstream
346,000,000 – this is the number of people around the world who read blogs
300,000,000 – this is the number of active users on Facebook. If Facebook was a country, it would be the 4th largest country in the world behind China, India & USA.
Twitter is the world’s fastest growing social media service. From Feb ’08 to Feb ’09, it grew 1,382%.
20 hours of video is uploaded to YouTube… each minute. Every day. There are millions of videos created by ordinary people on YouTube today.
13,000,000t – this is the number of articles on Wikipedia. Each of these articles are written and constantly updated by millions of Wikipedia users every day.
Social media is now mainstream. It beats email as the 4th most popular activity on the internet. The growth of social media is 2 to 3 times faster than other popular internet activities.
67% of the world’s internet population uses social media. Put another way, 2 out of 3 people use social media. This is why your business needs to get started with social media marketing.
Social Media Impact: Your customers are getting social, your business needs to get social too.
Social Media is Transforming Business
Social media is open, so businesses can jump right in without needing a third party. It’s not like TV advertising where you need to get an advertising agency to develop an idea, then a production company to film the advertisement and then go to the TV stations and buy a spot for you to show your advertisement. You do all this to communicate with your customer but the customer cannot respond, and many times they change the channel when your advertisement appears.
With social media marketing, you simply go to the customer’s blog or Facebook where they like to hang out and start talking. Consumers interact with your business directly–there is no third party. Through these interactions, you can perform marketing activities such as branding, awareness, lead generation, loyalty, website traffic and customer service.
Next are a few case studies that show how social media is transforming business and marketing.
Blendtec
Blendtec is a company that makes commercial kitchen blenders out of Utah, USA. Why do I know of a blender company? Because of this video:
Did you enjoy the video? I sure did. The guys at Blendtec only used a cheap video camera, a lab coat and their own blenders to produce these videos.
YouTube viewers then emailed their friends, embedded it in their blogs and talked and talked about it. This video alone got over 7 million views. Blendtec didn’t know it, but they were leveraging on the viewers network of friends. It was online word of mouth that generated those 7 million views. Can you imagine the cost if you were to broadcast an advertisement 7 million times?
As a result of these clever videos, Blendtec experienced a 700% increase in retail sales, over 65 million views for all their videos, lots and lots of website visitors and they’ve been featured in TV segments, news reports, blogs and case studies of social media presentations.
Big Apple Donuts
Big Apple Donuts is a local company with a great social media story. They’re very active on Facebook. They’ve got more than 21,000 fans. Compare that to Windows 7’s Facebook Page, which is a current campaign being run by Microsoft. Even Microsoft can’t beat this Malaysian SME!
So how does Big Apple Donuts do it? In my analysis, Big Apple Donuts is so successful because they’re very good at connecting with their fans. They effectively extend the brand experience beyond their retail outlets to Facebook, the favourite hang out of Generation Y.
The Facebook updates that Big Apple posts are very simple and conversational, designed to spark responses from their fans. And the fans really respond with comments and likes.
And just look at the results. Big Apple Donuts is growing extremely quickly and have won multiple awards.
Spicy Corner
The last case study is from a local restaurant called Spicy Corner. The restaurant owner is also very good at connecting with its customers and leveraging online relationships. Check out this video I recorded with Ija from Spicy Corner.
The point I want to highlight from the video is how Ija uses Facebook and Twitter to strengthen relationships and form new relationships–profitable relationships–with his customers.
Ija said that his business grew 10% from Twitter alone simply by making friends on Twitter and then converting those friends into customers. I’m an example of that. And because I like him and want to help him, I tell my friends about his restaurant.
I’m not the only one. Other customers help Ija out by recommending his restaurant and even defending him. How would you like your own customers to be so loyal?
As a result of their social media marketing, Spicy Corner has got loyal customers and incredible word of mouth, leading to even greater awareness and more customers. They’ve even been featured in the media–you may have seen them in the November 2009 issue of Personal Money.
It’s Too Risky To Ignore Social Media
I hope I’ve convinced you that you need to get started with social media. However if you need further convincing, or if you need to convince your boss, here’s one more point–it’s too risky to ignore it.
In 2005, H&I Niaga, a local construction company was featured in the news for all the wrong reasons. They had beat out larger competitors for a Bank Negara tender, prompting accusations of corruption. This piece of news was then reported and discussed in some blogs.
Today, if you do a Google search for “H&I Niaga” you get all these blog posts about the alleged corruption. Imagine if someone Googled your company and found blog posts accusing your company of negative things.
Unfortunately H&I Niaga is not paying attention or doesn’t care about this. Or maybe they just don’t know what to do about it so it looks like potential customers will find all the dirty laundry when they Google the company name.
Here’s an even worse example. There’s a brand in USA called Kryptonite that makes bicycle locks. When you Google for their brand name today you find these interesting results. Why? Check out this video.
In this case, Kryptonite reacted very slowly to the YouTube video, even after they were notified about it. At first they tried to hide it and that just made bloggers highlight the story further. They underestimated the impact of social media on their reputation.
Social Media Impact: Consumers are already talking about your business/industry. They are not going to wait for you.
Where Do I Start?
Now that you’ve decided that you need to get started with social media, where do you start? There’s too much to fit into a short presentation today, so these next slides are broad step recommendations and can be summarized into this:
1. Take it one step at a time – start small, and once you’re confident then expand to different social media channels
2. Just do it – don’t wait till your campaign plan is perfect. 85% is better than 0%.
3. Use common sense – You’re dealing with human interactions and relationships, which you already know. Think of the cocktail party again and use your common sense online.
Now, here are some specific steps for you to get started with your own social media marketing.
Step 1: Listen
Before jumping into a conversation, listen first and understand what people are talking about. This also helps you get a sense of the playing field. Tools like Google Alerts, Twitter Search and Technorati help you to scan the web in 15 minutes a day. If you like, you can also use a RSS reader to help with your social media monitoring.
Step 2: Define Goals
Generally there are 4 types of goals to any marketing programme–Branding, Awareness, Lead Generation and Loyalty. When using social media marketing, you should know why you are on Facebook or Twitter. If it’s your first time doing this however, I suggest that your first goal should be to get familiarized with the social media channel you have chosen to participate in.
Step 3: Participate
This is where you jump in and get your feet wet. I suggest that you start a blog because blogs are the natural ‘home base’ for your social media efforts. Next, make some friends on Twitter. And if you’re confident enough, try starting a Facebook Page. For B2B brands, you may prefer to create a LinkedIn profile instead.
Step 4: Keep Learning
I’m always trying to stay on top of the latest trends and tactics. I know it’s difficult for business owners like you but occasionally try to read these blogs or these books. Do come visit my site as well, I will be introducing a monthly marketing newsletter soon.
Social Media Impact: Social Media is just a tool. It does not replace business basics, so remember to continually improve your products.
Please, Please Remember…
Finally, I want to leave you with these 3 thoughts:
If you don’t like change, you’re going to like irrelevance even less
Social media is changing the way businesses communicate with their customers. You need to get on board right now or risk totally losing touch with consumers.
Small businesses have a big opportunity with social media
This is because small businesses are generally more personal and connect with their customers easier than large companies like Microsoft. And really, social media doesn’t take a genius, you just need to understand the tools.
Get out there and get social
Enough said. I hope you enjoyed my presentation.
If you like this presentation, please consider signing up for my Buzzmedia Bootcamp: Social Media Basics seminar to start using social media to grow your business.
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