The customer is not always right, but at the end of the day, their opinion is the only one that really matters. Since the emergence of social media, consumers have more access to trustworthy information through review sites like Yelps and Angie’s List. The average person has 359 friends on Facebook –and since Friends Don’t Let Friends buy junk, they recommend brands through photos, comments, and of course “likes.” Coca-Cola is the most “liked” brand in the world. Their 42 Million “Likes” allow them to reach millions of customers with high frequency brand messages.
In advertising, effective frequency is the number of times a person must be exposed to an advertising message before a purchase decision is made. According to Nielson Ratings, the average user spends 7 hours 46 minutes per month on Facebook. That gives super social brands like Coca-Cola almost a full business day to engage customers, build loyalty, and cultivate brand advocates. Less engaged brands are failing at customer relationship management and branding. There are 174,586,680 registered Facebook users in the United States, and in 2012 you’ll still find plenty of businesses that don’t believe in social media. The most common knocks on social media sound like;
1. No reliable metrics exist to calculate ROI
2. It takes too long to payoff.
3. We’ve had success without it.
These objections are telltale signs of ignorance and shortsightedness. According to Nelson Rating, social media and blogs reach 80% of active U.S. internet users and represent the majority of Americans time online. Social media is the most consumer engaging form of media. It’s the most customer focused, and therefore, the most beneficial to the long-term stability of the modern enterprise. Let’s look at each one of these objections in light of the facts of this new, ever increasingly social, U.S. marketplace.Objection: No reliable metrics exist to calculate ROI Rebuttal: A customer is worth today’s purchase + all future purchases + referrals.
The purpose of a business is to create and retain a customer that advocates for the brand. No house was ever built from the roof down. Likewise, no business ever existed without a customer base. The smartest businesses know how much a customer is really worth. Modern businesses tend to use the Lifetime Customer Value (LCV), which equals the net present value of all cash flows attributed to the relationship with a customer, as its key customer valuation metric. Businesses that use LCV tend to focus more on customer service and retention. American Express uses LCV to determine how much they should invest to court a new cardholder . Although LCV is en vogue, it’s obsolete and grossly inaccurate because it falls to account for referrals. The average customer has 359 Facebook friends. That’s 359 warm leads that could potentially stroll into your business. Sometimes the most important things can’t be measured. You can never really measure how much business a genuinely happy and engaged customer can refer to you. So err on the side of caution, and socialize.Objection: It takes too long to payoff. Rebuttal: Strangers –> Friends –> Customers –> Advocates
“Never talk to strangers.” That’s what we were taught. As we get older and more familiar with people, some of us ease up a little bit. But when a stranger tries to sell us something, even us extroverts are suspicious and inclined to say “No.” The conversion rate on cold call sales is just 1% simply because people don’t feel comfortable buying from strangers. Social media gives businesses the ability to go from “strangers” to “friends” before the sales pitch is made. A sales pitch from a friend is more welcoming and relevant to you because they know more about you than just your phone number. You trust that your friends have your best interest at heart, so its nothing to buy a product from a friend that you needed anyway.
Once a sale is made, social media gives you the means to stay in touch…. remember that you’re friends first. By staying in touch, your customers are constantly being reminded of your brand every time you engage them on Facebook and Twitter. Yelps even allows businesses to email customers that review their product or service. If a customer had a bad experience, you’ll be able to reach out to them in order to rectify the situation. The goal of post-sale engagement is twofold. First, you have to retain customers. It is always cheaper to retain a customer than it is to acquire a new one. Second, you have to strengthen each customer’s bond with your brand. When customers relate strongly to a brand, they will advocate for it, even if better alternatives exist.Objection: We’ve had success without it. Rebuttal: Innovation always springs from knowledge of industry and knowledge of customer.
New products and services are an entrepreneur’s prospective solution to a recognized problem in the market. Your business has to be in the trenches engaging customers with meaningful dialogue. You will learn so much about your target market by listening and asking questions. Some businesses treat social media like a billboard. They’re using social media, but they forget to socialize. Learning more about customers is a huge part of social media. You cannot be successful in business by ignoring your customers. If your business is customer-focused, then your business is using social media.
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