Social Networking For Businesses: Go Where The Customers Are.

Posted By: dotCOMreport Editor

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Is social networking good for business or just a giant waste of time?

While they believe they need to use Twitter and Facebook to stay in the mix, many businesses doubt they have ever gotten a single customer out of it. More importantly, they believe that while they’re spending all that time networking, they’re “not working.” Where Web 2.0 does appear to come in handy, is in helping existing clients stay up on their company’s activities.

Many of these companies’ technology skills and usage vary widely, but they share several key viewpoints.

For one thing, they all state that their primary origin of new business is word of mouth and personal referrals. And while some describe social networking as “word of mouth with a megaphone,” the businesses all make clear classifications between real-world referrals and those made through online social networks.

It isn’t that they’re not knowledgeable of the online options. Almost all of their companies have Web sites, and an impressive two-thirds of those sites are updated weekly.

Some are’t as skeptical as others, but aren’t completely convinced either.

The manager of events management company, for example, uses Twitter to post comments about the hotels she visits, but keeps Facebook for personal use. Her tweets then automatically update her Facebook status. She’s also on LinkedIn, though that consumes less of her attention.

Does her social networking efforts actually make a difference? “I think it does,” she says. “The people that follow me have an interest in hotels and events, and they get good information.”

A gentleman who runs a management consulting firm, uses LinkedIn to source associates, employees or contractors to match clients’ particular needs. But others prefer to use more personal methods to fill out their small, close-knit staffs. He added that technology also enables him to hire contractors, and even full-time employees, who hold positions in remote locations. That can generally save considerable money compared with local workers, and it can place you in position to hire the most qualified person rather than the person who happens to be nearby.

E-mail marketing is likely the most popular online marketing method. One person said she regularly posts announcements on Yelp and Smalltown, while another relies on e-mail marketing to promote her Italian restaurant sending bulletins promoting wine pairings, birthday and holiday celebrations, and even ordinary follow-ups and thank-you’s. Another manager says he has prepared several HTML e-mail campaigns for his clients and is now considering doing e-mail marketing for his own business. But as he points out, arranging your own e-mail marketing takes a lot of time, from writing the e-mails to implementing the address database.

But search advertising doesn’t seem to be popular at all with most. A restaurant owner used Google AdWords but discontinued when she didn’t see results. “I’m spending money and not getting anything back.” Yet the business owners weren’t relying on print media either. Only one or two have advertisements in the Yellow Pages.

Most of the business owners complain that the economic situation is making it more difficult to get paid on time, if at all. One solution that has been suggested is to accept credit/debit cards, even for business-to-business transactions. The 3% to 4% fees are a small price to pay to get your money right away. Businesses are advised to use a separate bank account for the cards, to prevent the banks from confiscating cash to cover a disputed payment.

Finally, on a positive note, 80% say they plan to step-up marketing spending this year. Maybe that’s a sign that the end of the recession is near.

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