Archive for June, 2011
According to a new survey from The Pew Research Center, Facebook dominates the social network space with 92% of users. This dominance by a big player may leave pricing power in their hands, but it does simplify the time investment needed to manage social network marketing for small businesses.
Plus, a big percentage of the total audience is connected to social networks: In this Pew survey, 79% of American adults said they used the Internet with nearly half of them (59% of internet users, so 47% of the total adult population) say they use at least one social network. This is close to double the 26% of adults (34% of internet users) who used a social network in 2008, according to Pew.
Here is how Facebook dominates the space:
- 92% of social network users are on Facebook
- 29% use MySpace
- 18% used LinkedIn
- 13% use Twitter
This makes life easier for small businesses who wish to market via the social network channels. Work with Facebook and 90% of active social network users are covered. Will this dominance endure?
Two recent developments will have Facebook executives fretting, and complicate life for marketers:
- Google launches Google Plus, their new attempt to capture some of the Facebook magic (and traffic). Here is a good review to bring you up to speed.
- Similarly, MySpace, the original social network success and current also-ran, has been sold by News Corporation to an ad network named SpecificMedia, and in part to Justin Timberlake. This may open the door to MySpace recovering some lost mojo, and therefore market share.
The problem for small business people (most of whom at least dabble in social network marketing) is that if you fragment the market, the task of marketing gets more complicated because you have to manage more than one relationship to run a proper campaign.
The only benefit may be in pricing power, which currently resides largely with Google in paid search and with Facebook for broadly-based social network marketing.
Reducing hard costs is the biggest benefit I see from having to manage campaigns over more than a few sites. We shall have to monitor the market share of Google Plus and MySpace carefully over the next 24 months to see if they bear adding to the marketing mix.
When my wife first came to the U.S. from Ukraine in the late ’90s, one of the first purchases she made was a curling iron at a local pharmacy. She remembers being stunned by the challenge of choosing among ten different brands for this basic consumer item. Frankly, she was not pleased that the store made her do all the work. Why, she wondered, didn’t the store do more to winnow down the selection on her behalf?
From my native American perspective, consumer choice is good, but I saw her point: The store could have cut the options to five, say, and still have presented a sufficient range to satisfy most customers.
Today, that winnowing process is measurably more apparent. After years of expanding store sizes and stuffing shelves with “choice,” retailers are starting to reaccept some researching and winnowing responsibility in the face of demands from older generations, who apparently don’t want to wrestle with huge stores and extensive selections anymore.
A recent post on a Boomer Blog I follow explored this trend towards smaller stores that offer fewer choices while still emphasizing quality at a fair price. Older consumers seem to be voting with their dollars in support of this, as it meets their needs for less physically demanding spaces that don’t require lots of walking.
Oh, my aching knees!
Why is this important to all marketers? Because Boomers are retiring, and they will start demanding (as usual) that we accommodate their growing infirmities! They, and their parents, are moving their business to concepts like Tesco’s Fresh and Easy: Smaller stores with less broad selection, but enough choice to satisfy shoppers who trust that the retailer’s buyers keep the customers’ needs in mind.
Much as a newspaper editor selects which news goes to his or her readers, so stores are renewing their ability to add value by screening the hoards of available products more finely, and leaving less work for the customer in the aisle.
Retail shops may start emulating the online marketing experience.
If this trend plays out fully, we may even return to the general store concept, where you walk in with your list and a counter clerk does all the walking around to fill your order. Of course, the “clerk” may be a kiosk rather than a person — and that kiosk might have a chair in front of it. At that point your bricks and mortar store experience will feel just like your online shopping experience, an ironically full turn back to the “future!”
Small businesses have had a hard time justifying the time investment needed to properly leverage social media communication channels because the evidence of ROI has been lacking.
Research is beginning to answer that, and here is fresh evidence to consider, courtesy of Knowledge Networks/The Center for Media Research (in a new study called “The Faces of Social Media”):
- 38 million U.S. adults ages 18-80 report that they discover new products and brands or refer to social media before making purchase decisions, up 14% from 33.3 million six months ago.
- 23.1 million say they discover new brands or products through social media, up 22% from 18.9 million in 2010
- 22.5 million who use social media to learn about unfamiliar brands or products, up 9% from 20.6 million last year.
- 17.8 million say social media has “strongly influenced” their purchase decisions, up 19% from 15 million in 2010
- 15.1 million say they make sure to refer to social media before making a purchase decision, up 29% from 11.7 million last year.
Part of this is driven by the increasing number of smart phones, which make mobile online searching a very handy tool. You cannot ignore this trend, therefore, because “searching on the go” is here to stay,
It is clear that given this growth in social media shopping behavior by consumers, being active in social media has great potential to supplement your ability to deliver postive impressions to big batches of people. Obviously, you have to do it correctly to reap this gain (the devil is truly in the content and placement details in social media!) But across most demographics it is becoming a requisite place to be.
I am going out on a limb here to state that the preponderance of this growth of social media relevance is still more relevant for B2C firms, with B2B firms still “safer” in focusing on non-social channels of communication for awareness and lead generation. I would caution, however, that at least passive monitoring of social media needs to be embedded into marketing tasks, because your B2B customers are still people, and their consumer habits do seep over into their business buying behaviors. It is ok (for now) if a smaller B2B firm is not highly prevalent on social media, but it is not OK to allow others to “dis” the firm there without a response from it.
Plus, you absolutely must use social media tools for your own research needs. Trolling Facebook and Twitter have great informative value for any business looking for ideas or keeping up with competitors.
I could go on, but you get the idea. Or do you?
Here is another article on this topic that references more postive research from Ogilvy & Mather at the bottom.