When you know the opportunity cost of ignoring social media, can you afford to ignore it?
Everyone in business should understand opportunity cost (lost opportunity cost or missed opportunity cost). If you bring this kind of analysis to bear, you will quickly see why your business cannot afford to ignore social media as part of your marketing and customer service programs. Ignoring social media results in more than one missed or lost opportunity. Each opportunity carries a cost to your company. Before you start plugging numbers into a cost equation, understand that social media success requires three things: 1. Knowledge 2. Time (typically 6 to 12 months) 3. Involvement
Understand as well that social media marketing alone is not likely to achieve your marketing goals. Social media should be used alongside and in conjunction with a range of other online and traditional marketing tactics or activities. Finally, understand that you need to understand and know how to measure some new key performance indicators, including:
- Extended reachDo you recognize these icons of social media platforms?
- Extended visibility
- Thought leadership
- Market insight
- Competitor insight
Taken together, these opportunities add up to competitive advantage for many businesses and in many markets. Few companies can afford to ignore opportunities to gain competitive advantage. For many companies, the question is not if you are missing an opportunity, but why you are missing the social media opportunity boat. To understand why, answer the following questions.
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- Are you hesitant to begin using social media?
- Do you know too little about social media to utilize it?
- Are you uncertain where/how to start using social media?
- Is senior management preventing the company from becoming active on social media?
- Are you hampered in the desire to become active on social media by lack of budget or resources?
- Are your decision makers waiting for some kind of incontrovertible proof of the effectiveness of social media marketing?
- Do you believe social media should be added to your current marketing mix with no additional strategic planning?
- Do you believe you are able to handle a social media marketing program internally with no additional staff?
- Do you believe social media is irrelevant to your relationships with your customers?
- Do you believe social media is irrelevant to your branding efforts?
- Is social media irrelevant to market and customer sentiment research?
- Do you believe online reputation management is unnecessary?
- Is social customer engagement unnecessary?
- Do you believe your customer service program is sufficient without social media?
Do you believe your customers do not expect your company to have a social media presence?If you answered “yes” to any of these questions, your firm is not merely missing opportunities. More than missing opportunities, your company does not know the value of the opportunities you are missing.
To change the situation for your firm, you will need to do several things:
- Assess your company’s lost opportunity cost.
- Do some research into how your competitors and others in your industry are using the social media.
- Gather facts about how social media can be used most effectively for your company.
- Learn about individual social media platforms and how they can help your with marketing, branding, reputation management, customer engagement, customer service, understanding customer sentiment, etc.
- Ask your customers if they expect your firm to have a social media presence.
- Learn how to begin a social media program
- Decide whether to outsource or manage your social media presence internally
- Develop goals and strategy
- Learn how to measure results
- Convince senior management
- Implement your plan
The power of Word of Mouth Marketing is the level of trust most people have in the recommendations of friends and family members. According to a 2011 Nielsen Study, 92% of people trust these recommendations. Where are these recommendations typically shared today?
Hmmm. Facebook or a Chew bone? I’ll choose Facebook
The second most trusted source of information is consumer opinions posted online on review or recommendation sites, and social media networks and top influencers in various industries or networks. If you are tired of calculating the opportunity cost of ignoring social media, understand that your company cannot afford to continue in this way. Next, get busy. You have the steps. If you need help, call us. We help people evaluate and understand the potential of social media programs every day.