Why Spend Money on Social Media? Yes Really.

January 18, 2013

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Over the last few days I’ve been interrogating the rationale behind social media. I’ve been suffering from an existential angst that all this social media stuff is at best a kind of ‘branding wallpaper’ and at worst a big waste of company profits. OK, maybe this is an oversimplification, but bear with me while we consider it further.

These thoughts have arisen from a number of conversations with people I respect in various marketing-related areas.

First, in conversation with a published leader in creative thinking and ex Creative Director of several major ad agencies, the prospect arose that “Social Media might just be a big South Sea bubble.” I assume that my co-debater’s rationale relates to the overwhelming hype surrounding social media and the proliferation of platforms, some of which have questionable influence. The same person also cited Apple’s strategy in not engaging in social media – no Facebook, no Twitter, just strong brand building using other channels.

Second, reading an article about new Facebook measurements which set more store by local popularity. The tenet of the article based on the work of a company called Social Bakers was one of “look at who’s now up the list and who has gone down” as if it was some sort of beauty contest.

Third, working with a client whose family business has been running since 1947, who expressed the wish not to be a ‘busy fool’ – he wasn’t specifically referring to social media but the way that various forms of promotion can involve expense, effort and, in the end, er, perhaps not the anticipated profits.

So why spend money on social media? Here are just a few answers to consider:

1. There isn’t another way  to reach your customers and other interested parties such as the press and investors with such reach and immediacy.

2. If you are not controlling the conversation about your brand, someone else will – and it might not be favourable.

3. Social media enables you to engage in a conversation with the market, to learn more about customers’ views of your products and services and to ensure that the market views your company as open and approachable.

That said, social media can act as an enormous money pit and it is important to consider the objectives behind every channel and campaign. As with any off-line marketing, think about audience carefully – as each channel has a different profile – then allocated resources accordingly. Ensure that communications within the channels you choose are fitting in terms of style and tone. Measure all activity using both online tools and offline tools such as client surveys and even just talking to customers to understand where they go for information.

Many of my clients are businesses who make money by selling to other businesses. For these companies, social media is equally important but the channels may vary. Facebook is relevant for some B2B businesses and LinkedIn and Twitter are probably relevant for all.

On reflection, social media should be an important element of a company’s marketing strategy but I’m glad that I considered the question This is because it is easy to become over-influenced by the social media industry. The social media industry is like any other business. It’s there to do a job but it’s also there to make money. Make sure that social media activity is strategic, regular in order to be effective, engaged and well managed. Above all, focus on measurement and the bottom line.


Growing Your Business in a Recession

February 2, 2011

 

Keep a Sense of Focus in Recessionary Times

In November, I posted on How to Market in a Recession, explaining the importance of free information, relevance and careful testing of marketing strategies.

The more I talk to clients and consider the best ways to grow my own business in the current climate, the more synergies I see. So I decided to share these learnings in the hope that they are useful to others.

It may seem hard to imagine, but there is indeed much business in the current climate. It’s just a case of identifying where it is and tailoring your proposition to fit. Here are some thoughts on how to run your business in a recession:

1. Explain the value in your proposition. Don’t just give your customers value, explain where the value is. Your customers may need to justify their spend either to a board, their colleagues or even themselves.

2. Provide open pricing models. Offer a variety of different pricing options with the services very clearly defined for each one. This puts customers fully in control of how much they buy and for how long. This is true whether you are promoting office maintenance services to companies or running a restaurant for tourists. By providing an ‘a la carte’ or ‘set menu’ offering, customers feel in control of their purse strings and are more likely to want to buy from you.

3. Understand your client’s business in depth. By tracking your client’s business, you can help them stay on track and understand the challenges that their business is facing.

4. Deliver quality. Quality is always a prerequisite, but look at the details. What more can you offer to enhance your service offering? What can you do better?

5. Sweat the detail. Think about everything that’s important to your customer and make sure that your products and services meet those needs. For example, if you are running a tourist restaurant next to a beach, what would make someone visit your cafe instead of the one next door? Then, no matter how inconvenient to you, make those changes. If there are fewer customers on the beach, you want them to be eating lunch with you, not your competitor down the promenade. It sounds Darwinian but it’s true. If you are running a telecoms service for businesses, what annoys clients about the way other companies send their bills, extend lines of credit, send their engineers, pick up the phone? Take every one of these points and do them better in your organisation, even if it means taking tough decisions.

6. Continue to market. There are some cuts that need to be made in tough times, but make sure that everyone knows you are still there and open for business. Use innovative strategies, challenge pricing models, by all means, but make sure you promote your company with as much energy as in the good times.

I hope that these thoughts are useful. It would be great to hear your experiences.


How to Decide Whether to Exhibit at a Trade Show

January 24, 2011

 

Why Exactly Are You Going Around the World for an Exhibition?

It’s trade show season and across the world companies are asking themselves “Should we go to Broadcast Video Expo / CeBIT / Gamescom (delete or add to as appropriate)?” You get the idea.

It’s all too easy to go to trade shows for the wrong reasons and easy to stay away because the costs seem high. The following points might make it easier to decide one way or the other.

Reasons to Exhibit at a Trade Show

1. Your customers will be there. Not only will you have the opportunity to promote your company to them and entertain them, but you will exert a presence in an area surrounded by competitors.

2. The right potential customers will be there. Ask the organisers to send you a detailed breakdown of job roles and companies who attended the show last year and who have registered for this year’s event. Ask questions around the industry and find out whether the majority of ‘industry people’ are going to the show or whether it’s considered a turkey.

3. You met the right people there last year. Our memories can fail us. Think back and check your notes. Who exactly did you meet last year? What business did you close as a result of the event?

4. There are highly relevant talks taking place. This will indicate the type of visitors who are likely to attend. High quality, relevant talks will also provide added value and draw the right people to the event.

5. Consider the entrance costs. If the event is expensive to attend and in a place that it costly to travel to, you are likely to have fewer visitors but potentially they will be of a higher level. If the event is free and in a large city, there are likely to be more visitors but there will be some ‘tyre kickers’ along the way.

6. Check the date. Have the organisers considered the date of the event? Are the right people likely to be able to attend? For example, if you are promoting vegetarian food products at a large food fair, what other events or religious festivals might keep some key buyers away?

7. Do the numbers add up? If you think you could get perhaps three new customers as a result of the exhibition, and the value of these customers might be $100,000 each, then the cost of a trade show at $8,000 might be OK. If you think that you will not get any customers, or you will only get one customer at $2000, then it’s a waste of money.

Reasons Not to Exhibit at a Trade Show

1. Your competitors will be there. Ok, this might also be a reason to go, but first you need to consider why your competitors are attending. Is it simply because they have always attended? Don’t get drawn into other companies’ lazy thinking.

2. You are offered a good deal for booking early. Woah! Rein in those wild horses and consider the Reasons to Exhibit listed above.

3. The trade show is taking place somewhere nice. This is the worst reason of all. Book a holiday instead!

One last comment about exhibitions before I slide off to book a holiday at the NEC Birmingham ;o) Even if you attend an exhibition with the right delegates, book a great booth space, design a wonderful booth and meet lots of fantastic prospects, it means absolutely zip if you don’t follow up your leads. What’s more, the follow up needs to be within a week after the show. Yes really.


How Much Should I Spend on Marketing?

November 14, 2010

Strategy Should Define Marketing Spend

It’s not always simple to define the appropriate level of marketing spend for a business. However, here are some considerations that should make it a little easier to analyse.

1. How long has your business been established? If your company is well established with a good market share, it may be possible to operate marketing at a stable, but not aggressive level. However, this depends on:

2. What are your competitors spending on marketing? Although these calculations will never be 100% accurate, you should aim to spend more than your competitors.

How is Marketing Spend Calculated?

The most common method of calculating marketing spend is a term coined by IDC called ”MBR’ or Marketing Budget Ratio. MBR is essentially, a ratio of your marketing spend to sales revenue.

So What is Normal Marketing Spend?

Marketing spend varies by sector, type of business and other factors such as product lifecycle and competition. Technology companies’ marketing spend ranges from 1.1% MBR for IT service companies, to software companies who spend an average 6.5% of sales revenues. Yet there are some quite dramatic exceptions even within this band. Dot com startups seeking rapid growth and market share can spend as much as five times their annual revenues on marketing, although this is only sustainable through investment and with a view to establishing their market position as quickly as possible.

Business to business companies also vary significantly from business to consumer companies. In the Fast Moving Consumer Goods (FMCG) sector, it is common to spend 50% of net sales in the first year of a new product, reducing this to 8-10% within a few years. Conversely, B2B companies will typically spend a few percent of their sales revenues on marketing.

Although it only covers media spend, you may enjoy Paul Dunay’s excellent blog on how major technology companies only spend 0.2% of their revenues on media. As he explains, the bigger the company, the smaller media spend becomes as a percentage of overall revenues, making it harder for smaller companies to compete.

I’ve mentioned the importance of tracking competitors’ spend. It is also wise to think about the platforms on which you will need to promote your company. The online space is becoming increasingly crowded; competition for certain keywords is high. It is best to consult with an expert in online marketing before setting marketing budgets if these areas are important to you.

Finally, rather than allocating marketing spend on the basis of what is affordable, it’s perhaps important to take a step back and consider what will really move your business forward. How can you flourish in the competitive landscape? What are the important promotional routes to gain exposure? If the budget is not available, it’s worth considering outside investment or a change of product offering. Unfortunately a good product is not enough. It’s about making sure the market knows you have it.


How To Grow Your Presence Through Co-Marketing

November 10, 2010

Partnerships Can Help You Grow Your Business

There are many ways to increase your presence within your target industry. However, co-marketing is often overlooked and can be extremely valuable.

What is Co Marketing?

Co-Marketing comes about through a partnership with a complementary business. For example, if your company sells printing services, it might be in your interests to form a co-venture with a finishing company so that both sets of services can be presented to a potential client.

This form of marketing is particularly popular in the IT and software industries where it is expensive and time consuming to create additional related technologies but where related software could be particularly useful to customers.

Benefits of Co-Marketing

  • Co-marketing allows you to present another company’s services alongside your own, giving your clients a more useful package of services
  • Your company can gain insights from working with another, non competitive partner
  • The industry is likely to find your partnership of interest, leading to increased marketing and PR opportunities
  • You may be able to share marketing budgets with your partner company, enabling you to promote your business at more, and possibly more expensive, events
  • Your venture, if well chosen, will demonstrate expertise in your industry

How to Explore Co-Marketing Opportunities

  • Carefully research any company with whom you are considering a partnership. Check their financial status, their market positioning, their products and their marketing
  • Ensure there are no areas of competition or anything which would conflict with client agreements
  • Discuss how you will present your partnership and agree protocols for joint marketing and press work
  • Ensure that both parties check all promotional literature that is issuedin their name
  • Look at long term objectives – decide how you want the partnership to develop and work out how to achieve this
  • Create a detailed marketing plan that you are both happy with
  • Ensure that the sales and marketing teams in both organisations fully understand the services delivered by their partner company
  • Use PR – press releases and social media – to spread the word about the partnership and generate additional publicity for both organisations

Co-marketing can be a very successful route to new sales for both your company and your partner’s. If it’s not something you have explored in the past, it’s definitely to be recommended.


How to Buy a Trade Show Display

October 27, 2010

 

A Great Trade Show Display is Possible with a Little Investigation

So you’re planning to exhibit at trade shows? What are the best ways find a tradeshow booth that maximises your budget and looks great too?

If you’re like most businesses, it is important to gain real value from your budget. It is therefore best to find a solution to your tradeshow requirements that will work time and again. Here are my suggestions for scoping out your requirements and getting the best deal.

1. Assess your Requirements. At which tradeshows are you planning to exhibit over the coming year? Work out the potential size booth that you will most likely want at each show. Contact the organisers and ask for a quotation for the space and for a specification for the booth. Find out the height of the ceilings and whether there are any restrictions on size.

2. Consider your Requirements. If you are looking for the simplest possible route, a ‘pop up’ booth might be the answer. These can be assembled in minutes, usually come with lights and tend to be very good value. However, they are not easy to use if you need to cover a large space which will change in dimensions each time. If this is the case, it is worth considering a modular booth. These are made up of a number of screens which lock together either in straight lines or at right angles. If, however, you have a generous budget and need to make a big splash, it is worth considering a custom made booth. These trade show displays are best used in situations where the competition is high and the potential value of a customer conversion enables a little more creativity.

3. Compare Prices. Trade show displays are now available from a number of suppliers, so it is worth comparing prices and ease of assembly. Some systems lock together very simply, whereas others need a certain degree of expertise! It is easier to get better prices if you start to plan for your first exhibition early so that you can look around comfortably.

4. Consider Reusability. How easy is it to get new panels printed to replace the existing ones?

5. How Easy is it to Transport? A good trade show display should come with carry cases, preferably hard ones that can be shipped internationally without damage. If you decide on a custom built booth, consider transportation in the scoping exercise.

I hope that you have found these suggestions useful. Please feel free to share your comments and experiences.


5 Ways to Market in a Recession

October 22, 2010

Reinvent your Business and Flourish in Recession

Recently I have reviewed nearly everything associated with my business in order to provide the market with the type of service that they need and want. At the same time, I have been involved in purchasing services for clients across a range of types and price ranges. I noticed how my own behaviour has altered as a purchaser and seen how clients now purchase marketing and other services. This was a very personal experiment and not something that I believed initially would be of any real value to anyone else. However, meeting with all levels of professional, from financial to media professionals, owners of startups to consumer businesses, I believe now that some of my experiences might be useful to fellow entrepreneurs and marketers.

How to Market to an Industry in Recession

1) Be Flexible

With more pressure on budgets, there is more pressure on purchasers to make the right decisions. Offer ‘tasters’, either free or for a one off charge, to  enable clients to try out your services. If they like what you offer and find that it is successful, businesses will be shrewd enough to consider buying a larger portion of your services. For example, I looked at two PR distribution sites recently. One enabled you to send one press release; the other only allowed you to buy a year’s subscription. I picked the company that allowed me to buy just one release at a time.

2) Be Measurable

Wherever possible, try to show how your products and services produce measurable results for your clients.  This could be clicks through to the client’s website, increased sales, more footfall within a store, increased covers in a restaurant. However, try at all times to tie your activity directly to the end result. For example a restaurant could issue a postcard with a coupon which could be redeemed against an online booking. This would offer complete measurability as to the success of the campaign. This is nothing new but it’s even more important when budgets are squeezed.

3) Be Transparent

Be transparent with your costs and demonstrate where the value is in your services. Take time to really understand your client’s business and in turn, this will generate respect for your company.

4) Be Innovative

Be innovative in the areas where you look for business. Enter new markets but research them thoroughly. Leave no stone unturned.

5) Be Dynamic

Consider how to improve your business. If your business is about supplying information, how can you offer better, deeper insights? If it is about supplying goods, can they be better quality? Here’s an example from this week. I was looking at online baby gifts for a friend. There were several sites offering excellent quality gifts at about the same price. I picked the service that provided the gift in a box personalised with the baby’s name. Well done Baby Gift Gallery.

We’re all working to keep our own businesses in good shape and I hope these suggestions are helpful. For further assistance with marketing your business, don’t hesitate to contact me.