Social Media: Myth or Miracle?

Back when I was an advertising salesman, business owners would often dismiss me by saying, “I believe in word-of-mouth.” Then with a smug, self-satisfied look, they’d say it again, as though the words made them feel fine and righteous. “Word of mouth is the best form of advertising.”I almost opened The Word-of-Mouth Advertising Agency in 1984. My plan was to hire people to ride up and down in elevators of tall buildings and say things like, “Have you tried that new café over on Third Street? I hear it’s really good.”My fantasy response was to say to business owners, “You believe in word-of-mouth? Great! That’s what I sell!”Today you can invest in a form of quasi-advertising similar to my elevator plan. We hear about it everywhere we go: “Social media is the new marketing.”But it isn't true.Lest you think me out of touch, let me remind you that I accurately predicted the impact of social media in my “40-Year Pendulum of Society” presentation in December 2003, long before Facebook, MySpace and Twitter came into being. In January, 2004, I made the same presentation in Stockholm, Sweden, to the great advertising agencies of Europe. From there I took it to Sydney, Australia, then on to Canada and the United States.Social media is not “the new marketing.”Now before you get all worked up and send me an email explaining why you respectfully disagree, give me a moment to share my definitions for 3 commonly used terms: (I've learned over the years that many disagreements revolve around the lack of any definition of terms.)1. Advertising is what you buy from the sales department of any media.2. Public Relations are what you get for free from the news department of any media.3. Social media is word-of-mouth empowered by internet and cell phone technologies.(Based on these definitions, the purchase of targeted ads on Facebook would be classified as advertising, not as social media.)REUTERS – Oct 8, 2009: “Three-quarters of small businesses say they have not found sites such as Facebook, Twitter and LinkedIn helpful for generating business leads or expanding business in the past year, according to a survey conducted for Citibank Small Business of 500 U.S. businesses with fewer than 100 employees.”If you haven't yet invested a few hundred hours in a social media campaign for your business, let REUTERS and me save you the time: Three-quarters of the businesses who have tried it were disappointed in the results.Are there business examples of success using social media? Of course there are:1. Using Twitter, businesses are building lists of bargain hunters who want to be the first to know about new offerings. Announce a highly desirable product at a highly desirable price – or free – and you can draw quite a crowd. But that’s always been true, hasn’t it?2. Barack Obama’s skillful use of social media helped propel him to the presidency. His secret? From the beginnings of their campaigns, Barack Obama and Hillary Clinton were both sending tweets on Twitter. The difference is that when Obama had 44,596 subscribers following his tweets, he was following 46,252 others. Hillary was following no one. Imagine how those 46,252 people felt: “Hillary Clinton wants me to hear her opinions. Barack Obama wants to hear my opinions.”3. Feasibility studies are hugely enhanced by social media. A single question, “Who likes the flavor of bacon?” resulted in 35,000 possible customers, 10,000 inquiries and 3,500 sales of Bacon Salt.4. Entertainment has always triggered word-of-mouth. People will stand in the lobby and text their opinions to their friends before ever leaving the theater. Hollywood studios are realizing that opening day is the only day that can be helped by advertising. After that, the movie's future is in the hands of the viewers. Are you in the entertainment business?Bottom Line:1.   Not every business is equally suited to leverage social media.2.   Many businesses are jumping onto the social media bandwagon without understanding the limitations of the vehicle. 3.   Social media is not a replacement for advertising.4.   The most universal benefit of social media is that you can search your own company name (on Facebook, etc.) and find out what's being said about you.5.   The business benefits of social media often fall short of an acceptable return on the time invested.   6.   Create ecstatically happy customers and they’ll spread the word through social media. Create disgruntled customers and they’ll spread bad word even faster.7.   Focus your attention on your customers. Social media will take care of itself.Now go get ready for Christmas.Roy H. Williams