Results versus hype: can small businesses realize value from social media?

Cynthia CloskeyGeneral

An article in the Wall Street Journal last week (“Entrepreneurs Question Value of Social Media,” Sarah E. Needleman, WSJ 3/15/2010) said that a recent study showed that small firms were having mixed results in their use of social media.

In and among the survey results, the article gives several examples of companies seeing a positive ROI on their social media investment. There’s a common thread among them: Each successful firm has been consistent in using the tools over time, and patient in waiting for results.

Some entrepreneurs say they’ve found early indicators that their
social-media efforts are paying off.

“The people coming from social media have been buying,” says Stephen
Bailey, who oversees social-media and other marketing initiatives for
John Fluevog Boots & Shoes Ltd., a footwear and accessories retailer
in Vancouver with about 100 employees.

As evidence, Mr. Bailey points to a 40% increase in online sales in
2009, the first full year the company engaged consistently in
social-media marketing, compared with 2008 when it was just getting
started. He says he can draw a correlation between those figures and
social media by looking at traffic to the company’s Web site from
Twitter using Hootsuite, a free Twitter-management service from Invoke
Media Inc. Other free services that track Web traffic from social-media
sites include Google Analytics, CoTweet and Lodgy.

“The second we started using social media, it became one of the
biggest drivers of traffic outside of search engines,” says Mr. Bailey,
adding that his research shows these visitors spend as much time on as those who come from other online destinations. The
company doesn’t invest in paid advertising on social media, he adds.

John Fluevog Boots & Shoes is one of the companies I give as an example in our workshops on social media, particularly for their use of their Facebook page. Their social media interaction extends beyond Facebook though. On their website they solicit customer feedback, hold contests, and find myriad ways to entertain and engage customers. As Mr. Bailey of Fluevog says, social media complements these other efforts. It’s a useful example of a firm using online networking as part of a larger strategy.