Some Small Businesses Have Social Media Budgets Over $100,000

How does your social media budget compare with other small businesses?

If you’re like 5% of the small businesses that have a social media strategy, then you have a social media budget over $100,000 annually.

But what if you’re not part of the $100K club for social media budgets?  Well, the fact is, most of your peers that are already using social media have much lower budgets.  The median budget for social media among those small businesses is far smaller – between $1,000 and $2,499 per year, as this week’s chart demonstrates:

The data is from the 2012 Small and Medium Social Business Study conducted by the SMB Group in mid-2012.  That study surveyed small businesses with under 100 employees.  The numbers do NOT include the cost of internal staff, although the numbers DO include outside consultants. The data covers just those small businesses that already use social media.

A few key points are worth pointing out:

(1) Non-strategic users of of social media are less likely to have a budget for social media. No surprise there.
(2) But what is a surprise, is how many small businesses say they use social media strategically — yet have no budget or report a minuscule budget of $500 or less. You’d think that strategic users would be more deliberate in allocating specific funds for social media. But it’s possible that their biggest expenditure is internal staff dedicated to social media — staff costs are not reflected in these numbers.

(3) Some small businesses are jumping on the social media bandwagon without thinking it through.  They may be wasting money, leading to disappointment later.  Look at the percentages of small businesses with no strategy that are spending $25,000, $50,000, even $100,000.  If they don’t know what their strategy is, how can they know whether all that money is being well spent?

Here is what you should do:

If you operate or work in a small business, this shows what your peers are budgeting for social media.  As you can see, aside from internal staffing costs, social media need not cost a lot out of pocket, especially at the start.  The median external expense is under $2,500 annually (around $200 a month or less). Most small businesses can afford that. 

Perhaps the biggest challenge will be to allocate staff internally, as the staffing costs are not captured here — and social media is time-consuming to carry out.  Also, be sure to first develop a social strategy to avoid disappointment and waste.  It’s not bad to spend — just bad to spend unwisely.

For consultants, marketing agencies and technology companies, consider that small business budgets are all over the ballpark.  Some appear willing to spend freely (even without a strategy!) yet others do not.  That suggests you should offer a variety of different price points, starting with free limited offerings, and offering a migration path up to higher-priced, more full-featured offerings.

As small businesses see wins from free advice and or low-cost tools, the smart ones will be more inclined to invest in higher-level solutions and consulting to drive better results. “Help small businesses develop a social media strategy driven by their business goals to get value from social media,” adds Sanjeev Aggarwal of the SMB Group.

Social Media Continues to Grow, Exits 'Infancy'

According to the Nielsen and NM Incite's 2012 Social Media Report, social networking is no longer a considered a passing trend as consumers are spending more time on social networks than on any other category of sites.

Social media is no longer in its "infancy," the study stated. Nielsen found that consumers spent 30 percent of their total online time on their mobile devices accessing social media sites, while on PCs, social media sites accounted for 20 percent of their browsing.

"The recent proliferation of mobile devices and connectivity helped fuel the continued growth of social media. While the computer remains as the predominant device for social media access, consumers' time spent with social media on mobile apps and the mobile web has increased 63 percent in 2012, compared to the same period last year."

Facebook remained the most-visited social network in the United States, with most U.S. members of the social network continuing to access the site via PC— 152.2 million visitors. Mobile visitors, meanwhile, accounted for 78.4 million members through native Facebook apps, while 74.3 million users visited through mobile browsers. Content sharing service Pinterest produced the largest year-over-year increase in both unique audience, as well as time spent on any social network on PCs, mobile web and apps.

The rise of social media during the past few years has been well-documented. Facebook announced in October that the social network exceeded one billion "active" members, with over 600 million users utilizing the service on mobile devices. Twitter is now publishing 1 billion tweets every 2.5 days.

Google+'s VP of product, meanwhile, had recently stressed that the former is a "social network of the past", with its intrusive advertisements "pissing off users." It's quite a statement for a company who has seen its own social network, Google+, being branded a ghost town since its inception. Although it boasts 400 million registered users, Google+ been criticized due to said users hardly ever logging in. Still, Google has stressed it's the best social service available so it must be, right? ...Right?

Pinterest Launches Business Tools

The photo sharing website, Pinterest has already been used by businesses for creating communities, increasing product familiarity and bolstering their social media campaigns.

Now companies will be able to create business accounts with their name, instead of first and surnames. Their photo boards will be able to earn a ‘verified’ badge by embedding their websites with hidden code which, in turn is recognised by the Pinterest system.

Is this a sure sign that the image-rich website will be monetised in the near future? It was revealed that 97% of the personal accounts on Pinterest are held by women, so companies already have a clear demographic at their fingertips.

On the website, the question of how they make money is answered with a vague response: “In the past, we’ve tested a few different approaches to making money such as affiliate links. We might also try adding advertisements, but we haven’t done this yet.”

If the previously clean design is cluttered by advertising, it might be a good idea to have these commercials ‘pinnable’, where you can share your favourite advertising. This would be especially effective during the Christmas advertising season, where companies such as Debenhams and John Lewis make more emotive short-films.

Shoppers Put Big Demands on Social Media

CONSUMERS looking for an instant response to their inquiries and complaints are turning to social media sites in their droves.

Gerd Schenkel, executive director of Telstra Digital, says the number of round-the-clock staff waiting to deal with customer inquiries has grown six-fold in the past 12 months.

"The live chat is growing very strongly because our digital channels as a whole are growing," he says.

"The growth rate for live chat is up about 600 per cent from last year to this year and this month we expect to offer about 140,000 chat sessions with our customers."

Time-poor Australians are among those who use social media sites such as Facebook and Twitter in an attempt to have their queries answered at a quicker rate, rather than phone or send an email.

Schenkel says Telstra now has several hundred employees working in their chat team to deal with real-time online customer inquiries.

"Live chat is often more convenient for customers because they are already on the website or they're already on a mobile," he says.

"They've seen a bill or a product and they have a question about it, so we find it easier for many customers to just click a button and have a quick chat session as opposed to making a phone call."

Self-employed massage therapist Belinda McLeod, 39, recently used social media to interact with her telecommunications company after having some problems with her broadband connection.

"I get frustrated when I contact call centres and am put on hold for half an hour," she says. "I couldn't find instant messaging and the customer service wasn't open on Sunday, but there were people online.

"I thought by raising issues publicly (on Twitter) they would do something about it."

She says the telco responded to her query on Twitter several hours later.

Matt Travers is the founder of new comparison website ServiceRage, which analyses customer feedback, and says the growing presence of social media is forcing companies to deal with customers in the public domain.

"Anyone can see an exchange happening between the company and the individual if they are using Twitter or Facebook," he says. "The balance of power is in the consumer's favour. Now more than ever it's important for companies to deliver good service."

Five Favorite Social Media Marketing Tools

 

5 Relatively unknown Social Media Sites to increase social reach:

 

1. Sprout Social - Social Media Management

I have reviewed quite a number of social media management tools during my tenure as a Practical EcommerceI contributing editor, many of which offer highly useful features. Though none of them handle every task equally well, for my own purposes Sprout Social has become the "goto" application.

It's a low-cost tool - subscriptions start at $9.00 per month - that enables me to manage most of the social networks in which I actively participate. Not only that, it serves as a social listening tool, facilitates scheduled content publishing, keeps track of new fans and followers, and provides real-time reporting of my social network engagement activity. There is a mobile version, too, so I am not confined to a desktop or laptop when doing so.

2. Bottlenose - Social Listening

Bottlenose makes sense of social media conversations and trends.
I've always said "listening is the new marketing," and where social media is concerned, truer words were never spoken.

A recent find is Bottlenose, which is a social listening platform that tracks in real-time what's happening around the web on topics of interest to me. In fact, Bottlenose refers to itself as the "Now Engine." Though its interface is reminiscent of Tweetdeck or Hootsuite, Bottlenose was built for the express purpose of making sense of all of the conversations you and I follow, and the trends they relate to.

3. Wordpress - Business Blogging

Of all the blogging software platforms I've ever used - a list that includes Typepad, Blogger, Posterous, Tumblr - I continue to come back to Wordpress. No other platform offers the same degree of rich functionality, extensibility, and design flexibility. And while it's not the easiest platform to use, for long form blogging Wordpress can't be beat!

4. RebelMouse - Content Curation

A prevailing trend in social media is content curation, which is the filtering of content based on topical categories, industries and tags.

A new curation platform, and one that I've really come to favor, is RebelMouse. Its ability to automatically capture, display and organize content from my Facebook and Twitter accounts have made it my "social front page." I can also edit content, highlight particular entries, and even move them around the page with drag-and-drop ease.

Due to its visually-oriented, Pinterest-like interface, it's also a tool that merchant's could easily use to aggregate and filter content from their e-commerce sites.

5. Jing - Screenshots and Screencasts

In addition to my own blogging and social media engagement activities, writing "how-to" articles for Practical Ecommerce often requires that I grab screenshots from sites I review. Of all the tools created for that purpose, no other accomplishes the task as easily as Jing.

Screenshots can be "marked up" with text boxes, arrows, highlights, or captions, and users can automatically store screenshots and screencasts at Screencast.com, a free file storage service.
Those are the five social media marketing tools I can't live without. What's yours? Feel free to comment.

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