Following my recent article (Can you afford free Social Media – Part One) – I realise that I may have struck a nerve in the market place. Hoping that my readers now understand that Social Media isn’t actually a free exercise, in Part 2 I want to help those business owners and CEOs who have made the decision to enter the social media arena with further financial perspective and advice from someone who has done it all before.
Most people complain that they never have enough money. Guess what? The same goes for businesses. Even the biggest businesses in the world have money issues. Granted these are very first world issues, regardless – issues they are.
Social Media, marketing’s new toy, is often hard for businesses to assign too much money in the budget to because of a problem I like to call “Business Self Interest”. Without going into too much detail – Business Self Interest is a term I have coined for the problem businesses have whereby they reward staff members and board members alike for periodical profits. There is often no reward for an increase in brand presence or consumer engagement (these are viewed as too hard to measure). As an Accountant by trade, this makes sense; however as a Strategist by nature, this approach has several pitfalls.
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THE SELF INTEREST PROBLEM
The problem here is that we find decision makers hesitant to spend money on social media that will not guarantee or necessarily result in a periodical increase in profit. Often the benefits of a strong social media strategy are seen over the course of time (looking something like the graph below). While the largest expense may be realised upfront, the largest benefits are still yet to be realised or as I like to say “are still in the bank earning interest” (Thanks @Toby_Jenkins). This consequently pits personal interest against business interest.
Why would an employee forgo personal interests (like a cash bonus) for the long-term benefit of the business? There is nothing in it for them is there? My view is most employees are employees so that they are able to come to work and do a job. This job and its success is heavily influenced by meeting budget and staying inside the lines. Obviously, there are exemptions to my view. For example, Google encourages every person in their business to treat it as if it were their own – come up with entrepreneurial ideas, think of what avenues the business could pursue in the future etc. Maybe this is why Google is where it is today? – I personally think so. Therefore unless you address the problem of Business Self Interest your business may never have social media helping you achieve your long-term goals and targets and will forever remain a giant roadblock.
THE DIVIDEND PROBLEM
Once you have cleared your first and most important road block, you will then be confronted with another road block – which is unfortunately the result of successful completion of the first. Stakeholders / anyone who relies on the profits of the business will ask, “Where is the money?” They want to know why their dividend, distribution, general pay cheque was less than last month’s. These are the people who don’t understand the above graph and that social media is a long-term (and often high-return) investment. If they are willing to tread some water and wait a while they might soon realise that the money that they were happy receiving has now doubled – and all because of great business management.
I have had this question and concern come across my desk many times in my career. In my experience, those who are patient and willing to wait will be successful in the social media battle; those who are not will ultimately lose. The thing about this though is that patience and appreciation for the beast are not only necessary traits for a successful social media campaign, but also for a successful business in general.
MORE TO COME
Yes, there’s more where that came from. These are simply the most common roadblocks you will encounter. What is more interesting are ways around the perceived “financial” road blocks you will most likely have. I will discuss this in more detail in Part 3 of this series by putting my accountant’s hat on to show you how to make money for your social media budget.