The big question mark over Social media marketing has always been about its effectiveness in creating value for the firm in terms of factors such as ROI, increased sales, profits or market-share. It has been observed that companies have spent spend huge amounts of money and resources on social media campaigns but have seen no real improvement when they assessed the company’s performance over traditional metrics discussed above. This has led to doubts over the usefulness of social media campaigns in the past. However, in recent times the usefulness of social media has been established beyond doubt through the success stories of a large number of brands ranging from various industries. So what has changed to bring about this transformation?
The real change has been the realization with marketers that Social media is not just another marketing channel to increase sales. It is a channel that works very differently from the conventional marketing channels. The whole point of social media is about engaging your customers with your brand by creating a buzz around your product or brand, but not necessarily by talking about your product or brand. The customer is at the center of all things in social media marketing. It is about a two-way communication with the customer on topics that may or may not be just related about your product. This kind of engagement with your customer builds trust and relationship which results into a positive brand-recognition and loyalty on the part of customer. It may also increase your visibility through network effects that take place on social media through the efforts of your existing user-base. So, naturally all these positives should result into a better company performance in marketing terms, right? Well, not necessarily!
Although successful Social media campaigns should impact your market share in a positive way, research has shown that this has not necessarily been true. For example, Kellogg’s with a market share rank of 2 for its breakfast cereal only had a social media share rank of 7, far below many others. It tells us two things – firstly, market share is not really a factor of just social media campaign successfullness. And secondly, those other brands which would have had better social media share rank couldn’t convert that into better market-share rank. Although they must have benefitted from their better social media share ranks in many other terms some of which could be intangibles. Such intangible gains could convert into more tangible gains possibly over long-term. Thus, the mindset required for marketing campaigns at the top is very different from the mindset required at the bottom. It is not necessary that a successful social media campaign will guarantee a brand’s success in overall marketing terms. The companies must therefore realize that metrics like ROI, Revenues and market-share is about the product and the company which could still be fulfilled by conventional marketing but since social media campaign is about customer engagement and their association with your brand, a successful social media campaign may not exactly give you the kind of marketing returns you had been hoping for and that is not bad!