What’s the real scoop on the usage and effectiveness of social media for small business? Between information from a couple of recent research reports and real life scenarios, it seems small biz is using social media primarily for telling—not selling.
A new white paper based on a survey of 151 small businesses using social media (sponsored by Sage and conducted by AMI-Partners) states that 64% of respondents spend most of their time in social media sites answering customer questions. 57% ranked networking activities as their most prevalent, while 44% indicated “reference/education” as their most dominant activity.
Only a few businesses indicated they were using social media sites for direct sales.
These stats hold true for Lars Hundley, gardenpreneur of Clean Air Gardening, an online retailer of eco-friendly lawn and garden supplies. (Hundley, pictured jumping like nobody’s watching above, was not part of the AMI survey.) Because his is a web-based company, Hundley has long incorporated digital social media tools into his marketing and promotions and utilizes them daily.
“We’re not generating any measurable sales from Facebook or Twitter,” explains Hundley.
Instead, Hundley and his team have found social media to be most useful for customer engagement and product education. The company’s Youtube channel is a simple medium for providing tips and how-to videos, and its various topic-specific microsites are hubs for customer Q & A. The latter has proven to be an “awesome technique” for facilitating interaction.
While social media is second nature for a web-savvy business owner like Hundley, many other small biz people have been slower to dip toes into the water. The April Discover Financial Services Small Business Index (a national, random survey of 750 small biz owners) revealed that 38% of respondents now report being part of at least one online social site, up from 22% in October 2007. However, less than half of the 38% have used social sites for business purposes.
Likewise, it’s taken longer for them to feel comfortable using the tools. The AMI study found that 65% of respondents had grown more at ease with social media in the last year and that those who’d been engaged longer (over 3 years) were more open to social media use for the future. Obviously, usage over time fosters familiarity and increased skill.
(Of course, social media tools are moot points for businesses that don’t even have websites. In the April Discover Financial Services index, 62% of respondents stated they don’t have websites for their companies. Really?!)
On the flip side, there are some fun, inspiring stories floating around the blogosphere about businesses owners who’ve proven to be real social media mavens, integrating techniques into their companies’ inner workings or successfully instituting promotions that bring in the bling. In particular, there’s the much-buzzed story about the Naked Pizza Twitter promo. This New Orleans pizza purveyor did some sniper shot microblogs just to see what would happen, resulting in 15% of a day’s receipts coming straight from tweets. Not too shabby…
Overachievers aside, it’s clear that social media use for small biz is on the rise across the board. As for the effectiveness of that use? Only time will tell…or sell.