Social Networks – a Money Pot, or a Money Pit?

In consultant and self-promoting circles legend has it that online social networks represent a relatively untapped commercial resource. The participation and demographic figures are staggering and, if you’re a figure type of person, you’ll likely get excited watching the zeros stream off to the right. But one question remains predominantly unanswered (or, let’s face it, avoided) in much of the chatter -how can you make money from social networking?

The hype and discussion around this topic remind me of the early days of Google Ads. When that particular product was launched the internet filled with people who believed, honestly and truly, that they would make millions. Blogs were started in earnest and seemingly informative websites that were stuffed to the browser-brim with banner ads filled the inter-web. Oddly, however, many people never stopped to ask themselves very basic questions – why will people want to click on your ads?

It was marketing without strategy – little more than sophisticated spam – and over time users learned to block the ads out. Most people I speak to have never clicked on a Google Ad and many of them have developed the nifty technique of ignoring them to the point of non-existence. Some people, of course, have made some money out of the scheme but it is obvious that most people have not.

The notion that social networks can be exploited in a similar manner appears to be suffering from the same bouts of idiocy and poor thought, and the giveaway is in the name. These are social networks – if you behave in a manner that is anti-social then you will likely find your network reduced to only those ‘friends’ you created to increase your friend count. At the end of the day, people need a reason to become part of your network and to participate in whatever promotions you put forward.

This is not to say that social networks are without a dollar value. In the right hands, they can be used to add value to a brand or organization. The single most important concept to grasp is that social networks are about personal communication and, therefore, require personal commitment and input. Some organizations are using Twitter, for example, as a notification service. This is fine for what it is, but I’d wager that these organizations do not expect to make money out of this approach. They are simply using a free, popular service to share relevant information (oh god, I hope it’s relevant). But perhaps I’m wrong. Perhaps the people that follow organizations see value in the notifications and are, therefore, more likely to consider said organizations in future purchase decisions.

And here we have it – the key to the chest…value. If people see value in making a connection with you or your company through a social network, and you deliver on that value, then you are creating brand integrity. Moreover, since it is borne from a personal connection the brand integrity that is generated can often be stronger than that formed through traditional advertising or marketing.

The path from social network connections to money in the bank can sometimes be a long one but any attempt to rush it will likely backfire. Customers, like dogs, know when they’ve been duped. They might humor you the first few times but after a while, they’ll ignore you and find a quiet place to lick their privates.

So, how can you use services like Facebook, Twitter, and Instagram DM to your advantage? Here are some tips…

Make it personal – people want to connect with other people so don’t hide behind your logo, find someone personable within the organization who can act as a representative.

Share, don’t sell – anybody will give you direct, personal access so you can advertise at them whenever you feel like it (for those of you who just thought to themselves…what about television?…people are checking their Facebook during the ad breaks).

Target – just because it’s on the internet doesn’t mean it’s all fun…research, plan, target, deliver! Who are the people you want to make connections with? Why will they connect with you? Who should you connect with to build some integrity?

Provide opportunities – all of this effort is wasted if you never make any attempt to capitalize on it. Make sure your profile accurately represents what you sell or do. Provide contact details that go to the right place. In your posts or updates, don’t be afraid of mentioning opportunities to take advantage of services or discounts you’re offering. But please, be intelligent about how you create these opportunities.

Be Active – nobody likes a boring friend so make sure that if you are going to try and use a social network for your business that you keep at it.

Measure – as with any business activity you should find a way to monitor the success of your social network exploitation. Use URL trackers to monitor traffic, web analyzers to monitor how many people take a look at your profile or company website. Most importantly, if it isn’t working then adjust what you’re doing or stop it. No point wasting everyone’s time and money!

Kris is our in-house writer with a lot of experience under her belt. She loves to provide her insight about the market trends and her predictions about market trends are often on point.