In his weekly business banking post, Greater Building Society CFO Greg Taylor says small business can no longer ignore the impact of social media.
Whether you are a user of social media or not you can no longer ignore the impact it is having on people’s lives and the potential it has for business.
I came across a recent report by Yellow on social media which showed that 65 per cent of Australians that use the internet also use social media. Two thirds of those social media users are accessing it via their smartphones. The Report also found that in regional areas businesses and consumers are more active on social media than people in metropolitan areas.
While more Australian consumers are using social media to inform their purchasing decisions, spending on social media by small and medium sized businesses (SMB) has declined as marketing budgets have declined.
I’m a finance guy and there are more qualified people than me to comment on the effectiveness of social media for business. My tip would be to understand if your customers and your business would benefit from social media and if so then resource it effectively. Social media should be integrated into your marketing, service or human resource plans. Just like other business tools, have a plan, a budget and performance indicators.
I found it alarming that, according to the Report, more than a quarter of SMB had social media channels but didn’t have a plan to drive traffic to those channels. Discounts and giveaways are the key reasons why consumers follow brands on social media but only a third of SMB on social media offer such promotions.
A 2012 study by American Express showed that the 17 per cent of consumers who used social media for service were willing to pay a 21 per cent premium at companies that provide great service compared to 11 per cent for those who do not use social media. The social media savvy consumers also told three times as many people about positive service experiences compared to the general population.
If you are going social have a plan, budget and resources.
This post is based on Greg's weekly column in the Newcastle and Lake Macquarie Post.