Small businesses are past the fact that they need to use social media. Customers are using social tools to communicate, shop, research and discover — most of which are rapidly becoming a mobile experience. And so, entrepreneurs are shifting how they run their business around that fact.
The question now becomes “how?” Booz and Company conducted an in-depth study with Buddy Media of social media’s marketing impact, and found that most businesses were not utilizing tools and services properly.
Chris Vollmer, a partner and leader of Booz and Company’s global media and entertainment practice, says businesses large and small are moving toward three capabilities: content development, community management and real-time analytics.
These capabilities are in conjunction with three major platforms: Facebook, Twitter and YouTube. When used properly, they provide a major opportunity to generate business value by building powerful, lasting relationships with consumers through digital communities.
Booz and Company breaks analytics down into four levels of expertise, ranging from counting social media activity to achieving strategic business objectives — in other words, actually making a sale.
Most small businesses are either still on level one (understanding their social scale) or stuck between engagement and advocacy.
Vollmer says small businesses can benefit greatly from gauging these four levels of analytics; these insights are especially useful to those who can’t afford to make major changes to their media mix.
Level 1: Reach – Marketers understand the social scale of their brands. They know how many fans, followers, subscribers, visitors and views they have, and how many discussions are taking place. They have visibility into where, when and in what context their brand is being discussed.
Level 2: Engagement – Marketers have moved beyond counting fans. They have insight into the activities in their various communities. They analyze the drivers of participation and amplification, studying the patterns in comments, likes, shares and take rates.
Level 3: Advocacy – Marketers can identify and encourage user behaviors that are associated with brand commitment. These include such metrics as: intent to recommend, referral and reshare activity, comments and followers per user, and brand favorability, consideration and preference.
Level 4: Return on Investment – The most sophisticated companies set out to achieve strategic business objectives based on their social media analytics. Most companies are still not fully at this level. For example, according to the survey, only about 40% of companies have metrics in place today to measure ROI-focused key performance indicators (KPIs), such as purchase intent, leads generated, conversion rates or actual sales.
Keep in mind that content is still king. In order for a small business to really benefit and evolve with these levels, they must provide customers with something to engage in. “It doesn’t always work to just have your ads up — that’s not something people really want to talk about or forward to friends,” says Karen Premo, Booz’s Principal.
What level is your company on, and what are you doing to move forward?