Are you ready to get more from your social media than just awareness and engagement?
Are you dissatisfied with not knowing social media’s impact on your organization’s bottom line?
Do you want to join the organizations and marketers who are developing business with social media marketing?
Then you’ll love this article, which covers how top marketers are driving and tracking sales and profits with social media marketing in 2018.
The State of Social Media Results
Recent surveys of marketers and CMO’s tell us that many companies have not yet solved many basic social media marketing problems:
- Marketing executives rate their integration of social media with their marketing strategy just 4.1 on a scale of 7 (CMO Survey, 2018, page 48). How can you expect great social marketing results, if your social strategy is out of alignment with your marketing strategy?
- 56% of 5,700 social marketers surveyed by Social Media Examiner in 2018 are uncertain about their social media profits or were unable to measure it. Only 10% (570 social marketers) strongly agreed they were able to measure their social media profits.
These are the professional social marketers- the top of their field. Imagine how difficult and uncertain it is for small business owners who aren’t caught up on the latest tactics and who have to wear seven hats in their businesses. And consider that there are over 2 million small businesses in the U.S., 500 Fortune 500 companies, 5,000 companies in the Inc 5000…. If only 570 social marketers have strong confidence in their ROI measurement, then most companies don’t have someone who’s confident about it.
- Although marketing executives’ #1 overall goal was customer acquisition, their #1 use of social media was not customer acquisition- it was brand awareness and brand building. Customer acquisition was their #2 purpose for social media (CMO Survey 2018, page 51). This odd priority echoes the above misalignment with their overall marketing strategy. It may be due to a misunderstanding or underestimation of the capabilities of social media marketing, or it may be reflective of the social media freelancers, agencies or employees they’ve had up to this point. When you work with social media personnel whose background is only in PR or branding, their orientation can affect your approach.
- When marketing executives were asked to what degree social media contributed to their company’s performance (a vague question to be sure, but corporate performance typically is heavily based on revenue and profits), they answered with an average of 3.3 on a scale of 7. That’s not an overwhelming vote.
- There are older surveys and stats that talk about the challenges of measuring social media, but I’ll stick to recent ones.
Does it surprise to you that marketers are having trouble improving social media profits if they aren’t measuring it well?
It shouldn’t, because as Peter Drucker said, “You can’t manage what you can’t measure.”
In digital and social marketing, you can’t improve what you can’t measure.
And when your social marketing strategies are not aligned with your overall marketing priorities, you have a recipe for social mediocrity.
The solutions to the problems that marketers and executives are surfacing are:
- Prioritize the use of social media for business development: customer acquisition, sales and profits. Ask for more from your social marketing. It’s capable of it.
- Hold social media accountable for achieving these goals.
- Make it a priority to measure social media accurately. Choose KPI’s, sales goals and start to measure profitability tied to your resources, labor, time and costs.
- Budget for social advertising, because it’s the most certain way to drive these results in social media.
- Get the people, resources, talent, training and tools you need to make this happen.
Easier said than done, right?
But you can do it. Many companies have.
So, let’s dive in!
How Today’s Marketers Are Making Social Media Profitable
How do leading marketers prove the impact of social on their bottom line?
The best marketers have social sales and profits analytics at their fingertips.
Many companies don’t realize their analytics are set up wrong and are inaccurate.
Do you have the tracking, the data and the insights you need to prove how social is driving customer and profits for your business? And to measure and improve it?
What does that look like? In our experience, these are the kinds of things you need:
- Expertise, or at least competence, at understanding, exporting and analyzing data from the social platforms: Facebook Page Insights, Facebook Ad Manager, Facebook Audience Insights, Twitter Ads, Twitter Insights, Instagram Ads, LinkedIn Ads, etc.
- Professional implementation of social ad tracking pixels: If you are using Facebook, Instagram, Twitter, LinkedIn or similar ads that use conversion code, make sure you either have a professional install and check the code, or hire one to check it. Not only is that code critical and indispensable for tracking, it also it essential to how the ads run. You need it for retargeting and in some networks, it also affects how well or poorly the ads are targeted within your targeting selections. It’s not optional. We’ve heard many IT and programming people who were not professional digital marketers assume that these pixels were only for tracking and that web analytics or a CRM would be enough. They are not. The tracking from the ad platforms must be installed also. If your web or ecommerce platforms are not compatible with the common ad platforms, they need to “get with it”, you need to switch to another platform that is compatible, or you will have to hire programmers to fix it. Or you will be seriously hampered against your competitors in the marketplace. We’ve worked with clients who had to stop marketing socially for 4 months while they had programmers white-label and make their third party scheduling software compatible with Facebook ads. It’s a problem of ignorance in the SaaS industry that will eventually fix itself, but it may take another five years.
- Google Analytics (or the like) with UTM parameters: you must manually help GA track the source/medium of all website traffic from social, or some will be undercounted. For example, without this, Facebook traffic will be undercounted by as much as 40% and will be placed in the “Direct” category.
- Google Analytics conversion assist reports: you need to consider both first click and last click, because once you graduate from the search marketing last-click only mentality, you will drive a greater volume of traffic and sales, but without first-click reports, you may cut out some of the first-click sources that ultimately drive your sales. Often, retargeting ads from various networks, and search sources close the sale with a last-click, but they may never have happened without the first click. Facebook, Instagram, Twitter and LinkedIn ads can increase your organic search volume dramatically, but you’ll never have evidence of this and you’ll spend in the wrong places without these reports.
- Professional CRM, and any additional add-ons required to track accurately: You need something like Salesforce, Hubspot, Infusionsoft, Zoho or the like if you are driving leads for salespeople. Your email account isn’t good enough. You need to track the leads in a professional system, and you need marketing attribution. Also, beware of conflicts in attribution reporting. Just as GA can misattribute social traffic, so can CRM’s. For example, if you use Hubspot free, or even paid without buying the Ads Add-on, Hubspot will not track Facebook ad traffic accurately. They admit this in their help screens.
Branding Alone Doesn’t Drive Sales
How do top marketers do social branding in a way that drives new customers?
Savvy marketers drive engagement, sales and profits while leading their categories.
The painful truth many companies discover is that branding alone doesn’t create sales. Just putting your brand out there doesn’t create sales. Just creating engaging posts doesn’t get you new customers. It might drive a few, but not enough to sustain a business. Not enough to call social media a viable business development channel that you’d want to dump more cash into and scale.
Do you have the tracking, ads, posts and optimization strategies in place to cash in on social?
First I’ll give you a list of the things that don’t drive customer growth and sales in social media- and then I’ll give you a list of the things that do drive them:
What doesn’t drive social media many sales and profits, if any:
- Tweetchats: they’re usually measure in terms of reach, which is not unique reach, so it’s deceptively high. There often aren’t a lot of links included in the chat’s tweets, so you may not even get much website traffic, let alone sales.
- Facebook posting without ads: Most pages don’t reach very many people when they post, unless they advertise to promote that post. Without reach, you have very little chance of anything else happening… like traffic, leads or sales.
- Facebook posts boosted on the page: This is the poor cousin of the engagement ad you can create in the Ad Manager, and it doesn’t work as well. It’s often created by someone who’s not really a Facebook ad professional, the targeting isn’t good, and the post itself may not have a high engagement rate. If it doesn’t have a link in it, there’s little chance of traffic, leads or sales. Even with a link, this is one of the worst ad types to try to try traffic, leads or sales with. You’ll probably just gets some engagement, and that’s it. But your costs will be high and your money won’t go as far as with an engagement ad in the Ad Manager.
- Instagram posts: you can’t add a link- they have to go to your bio link, and you only get one- it’s an extra step, and you may not have that many followers… so you probably won’t get very much traffic, if any… and even less leads or sales. You can promote these posts within the app, but again, these are not as good as creating Instagram as from within the Facebook ad manager.
What drives more social media sales and profits? Let’s move to the next section…
Social Ads Help Drive and Measure Sales & Profits
Why are Facebook, Instagram, Twitter and LinkedIn ads the most effective and trackable form of social media marketing?
Why are these ads the main drivers in social media sales and profits?
Because social ads drive not just engagement but also traffic, sales and profits… from 300% to 700% and higher.
Here are a few very short results from some case studies using social ads:
Lead Generation Case Studies
- HOME GOODS: We helped a home goods company lowered their cost per lead by 84%, getting them 7x the leads. We also more than doubled their new customer acquisition speed across their entire company. They were using an omnichannel approach, and the social ads, used as a swiss army knife for awareness, engagement and lead generation also directly drove some sales. We commissioned a third-party impact study and discovered that the social campaigns had stimulated an increase in organic searches in Google for their brand name. It was a shot in the arm for their entire company. Most of these effects happened within 4 months. The first month wasn’t brilliant, but soon after our measurement abilities enabled us to drop costs and drive performance.
- IT/CLOUD: We worked with a number of Microsoft’s partners in the cloud hosting business. For one, we created a new whitepaper. They wanted to experiment with Facebook ads rather than LinkedIn ads. We targeted CIO’s, sys admins and IT people. The most affordable leads were $29 each. According to industry stats, average lead in IT costs $370. Our cost was 92% more affordable than that. Facebook’s ad costs are quite low, and its ability to target job titles makes it both powerful and affordable. Sometimes LinkedIn is better, but LinkedIn can also be expensive and lower volume, since people spend an average of 2 minutes a day on LinkedIn and 35 minutes a day on Facebook. This, of course, varies with the audience.
- RECRUITING/STAFFING: We’ve worked with a number of companies to fill staffing and recruiting gaps applicants. We’ve been able to drive job applicants at 75% lower costs than CareerBuilder. Our social advertising for job candidates drives more traffic for these companies than any other source including Indeed.com.
- MARKETING: We created a lead-quiz for a marketing agency and drove thousands of leads for just $1.74 each. The average lead cost in this industry is $173. Our cost was 99% more affordable.
- SAAS: A SaaS company wanted to reach only people who worked at Fortune 1000 companies. We drove traffic to their whitepaper and got them new demos for $26 each. Again, the standard here is $370, and this was similarly about 93% more affordable than average.
- EDUCATION: We teamed up with an educational bookstore to run multiple lead gen contests. The average email acquisition cost has been around $0.60 apiece. The average lead cost in the Education industry is $60. Our leads were roughly 99% more affordable than average.
Why is the average lead cost so high and were ours so affordable? In part, the average costs are high because they include many traditional offline lead gen sources, which are more expensive. They also may include mark-ups for retail selling of leads. And we always see drastic reduction in costs when we do a lot of testing and discovery online. In traditional marketing, you can’t test a lot of things to find the most effective, compelling offer, wording, video or picture. Online we discover huge advantages through testing, and it saves companies lots of money and increases profits dramatically.
Again, when you can measure it, you can improve it. And we can measure a lot more things a lot more finely online.
When you explore the best in each of these categories, your improvements multiply:
- Targeting and customer psychology
- Creative, video, ads, copywriting and persuasion tactics
- Landing Pages and conversion optimization
- Lead Magnets, ebooks, whitepapers, quizzes, etc.
Make sure you aren’t lazy about your creative and testing/discovery processes. If you are, you’ll pay more than you need to, and you won’t get the kind of results we’re talking about here.
Ecommerce Case Studies
- HOME GOODS: With the home goods client above, we achieved a 60% reduction in cost per new customer. We saw over 900% ROI on the social video ad campaigns. 1,000% ROI on post engagement. And overall a 274% ROI on customer acquisition.
- TRAVEL: We’ve worked for years with a specialty cruise company drive customer bookings for as low as $30 apiece.
- FOOD & BEV: We drove 22x in revenue for a small pizza chain in Scotland of all places. I’ve been told not to talk about this one because the ROI sounds so high that it’s unbelievable. Oh well… those were the real numbers. Believe what you want. It’s true!
- HEALTH: We opened up a new revenue channel for a health products business. It was 700% ROI and the first year we drove 6 figures in revenue monthly.
- FITNESS: We helped a franchise personal training business open up a new marketing channel. Their goal was $700 per customer. We drove new customers at $415 apiece.
Social media driven ecommerce is the most challenging thing we’ve seen in digital marketing, but with enough time, investment and the right people and tools, profits can be found.
Sometimes it’s easy. Sometimes it’s difficult, and there are technical, branding and budget challenges. Every situation is different.
How Do Businesses Make This Happen?
These kinds of successes don’t happen instantly. There’s no magical CASH button in digital marketing. There are plenty of people trying to sell short-lived or fantastic tricks and short-cuts. As in many areas of life, those who can only tolerate easy answers tend to fall for get-rich-quick schemes and lose their shirts.
If you’re smart, responsible and realistic, you have much better chances of success.
Creating profitable social marketing is a process that takes 3-6-12 months. Businesses need to commit $5k in ad spend or more per month. It’s an investment. You’ll see a return on it, but not instantly.
- Month one is all about set-up. Ads may start running, but you have to get all the pixels and analytics in place, have the right targeting, all the right creative, etc.
- The first three months tells you what’s going to be profitable and what isn’t. You should have some really effective targeting and ads by the end of month three. That means affordable, high-quality leads if lead-gen, or profitable ads if ecommerce.
- By the six month mark your entire social campaign should reliably drive efficient results to the extent that it has made up for the costs of the first three months.
- By 12 months you should have learned so much and be getting such great results that you won’t even recognize your social program. It may have revolutionized your entire marketing program with the insights you’ve gathered.
Who Can Help You Accomplish All This?
We’re not born with kinds of skills you need to do the social advertising and analytics that drive social media profits. Digital natives don’t have them just because they know how to use Snapchat. Experts need business skills, copywriting skills, technical ad platform experience, analytics talents, and marketing experience.
You’re going to need:
- Social ad expertise: Facebook ads, Instagram ads, Twitter ads, LinkedIn ads. Do you want to have all those options? Do you already have someone who does Google ads for you? You may get some social strategy expertise when you get someone who can do the social ads, but you probably want to ask them about it.
- Analytics expertise: Website analytics like Google Analytics or Adobe Omniture expertise, CRM analysis, marketing automation analytics if you use Infusionsoft or Marketo or the like.
So how do you add that to your company? These are your real-life choices:
- If you’re a small business owner, you may want to do it yourself… sacrifice your own hobbies, free time and families to spend 20-40 hours a week learning for 3 years (why do you think all the job listings for this stuff ask for a minimum amount of experience?)
- Hire someone with no experience and wait 3 years for them to have significant experience and expertise. Are they taking online courses to learn? Are you paying for that?
- Outsource to someone freelance and part-time via a platform like Upwork. They’ll cost anywhere from $30-$60 per hour.
- Hire expert employees, experienced at ad platforms or analytics: $50-80K per year each – you’re going to need several to cover all the areas of expertise you need.
- Hire an expert agency: $30-60K per year (we find that the costs our agency are lower than in-house employees because we have multiple experts on staff who can more efficiently cover our various clients)
- Do nothing. Keep your social media status quo. Risk falling behind the competition.
Notice- what is not an option is: Do a whole bunch of random things you read on social media blogs… with no experience, no analytics, no skills… You CAN do that, if you don’t want to create any real impact. But if you want to drive new customers, sales and profits, you need expertise.
So, if you want your social to be as profitable as it is for these businesses:
- Make a commitment to build the program for 6-12 months.
- Set your goals.
- Create a budget.
- Hire the people or the agency.
- Start using social ads and all the analytics I talked about above.
Once you’ve done that, you’ll be able to measure your social media results.
Now go improve them!