Without clearly defined goals for social media activities, small and midsize businesses risk chasing an elusive return on their investment in the technology.
The SMB Group's McCabe cited another downside of the unplanned approach: With social media responsibilities often spread across multiple departments, ad-hoc use can lead to inconsistencies and conflicting priorities, especially in external applications. "You may have one thing going on in your little social media world for marketing, and a whole other thing in HR. What if those two things aren't meshing?" McCabe said. "The customer or the prospective employee might be looking at you and thinking: 'Boy, this company is totally schizophrenic.'"
Here are some key points SMBs should consider as part of a coherent social strategy: Who in the company is responsible for social media? What business functions will social serve? (McCabe noted that it can be much more than a marketing tool, and strategic SMBs in particular are using social technologies for a wide variety of external and internal uses.) How much, if any, money are you budgeting? How much time will be devoted to social programs--not just setting them up, but executing and evaluating them?
To that end, SMBs likewise need to set performance benchmarks. They don't have to be directly financial; in fact, until the budget has an actual line item for social, the metrics will likely be non-monetary. Consider areas such as: Number of new leads generated, reduction in customer service calls, number of resumes received for job openings, or feedback for new product development. Tie the assessment directly to the original purpose, be it external or internal.
Having a plan helps gauge return on investment (ROI), discover ongoing improvements and efficiencies, adapt to the constantly evolving social landscape, and ultimately produce bottom-line results. It also has another positive effect: According to the SMB Group study, structured social media users are much more likely to be satisfied with their efforts. For example, 37% of small business users with a structured approach to social media said they were satisfied or very satisfied with social media's ability to generate new leads, compared with just 14% of ad-hoc firms. At midsized companies, close to half (47%) of strategic users expressed satisfaction with social media's impact on customer service and retention, a marked jump from 26% approval among informal users.
Though taking a strategic approach doesn't necessarily mean spending money, it would appear that those companies that do allocate at least a small budget for social media are far more likely to have a strategy behind their programs. "There is a definite correlation between spending money and being a more structured user," McCabe said. "I'm not really sure it's the money, per se, that makes a difference. But if you've got the mindset 'I'm going to be more strategic about this,' yes, you're more likely to spend money." McCabe noted there's a chicken-and-egg relationship between strategy and spending--it's tough to determine if one precedes the other, or if both in tandem yield better results. But the link exists.
Businesses that are unsure if they want to spend money on social media should still approach it as if they are. Make no mistake: Any SMB with a social presence is making an investment, even if it never spends an actual dime. Set a plan, or plan to get sucked into the ROI black hole.
Top IT Trends to Watch in Financial ServicesIT pros at banks, investment houses, insurance companies, and other financial services organizations are focused on a range of issues, from peer-to-peer lending to cybersecurity to performance, agility, and compliance. It all matters.
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