Economics and FaceBook

Well actually all social media.

We hear from companies trying to hype social media and marketing, We fret when the operators want to use our data to target market us.  But what does it mean?

All merchants want to market to potential customers.  It is the only way they can let people know who they are and what they do.  In itself this is not onerous.  But in today's highly digital era, have they taken it too far?  Our family owns a small retail concern.  We are bombarded with social media dos and don'ts.  We are told we need a presence, but what that presence is, seems to be uncertain.

There are a lot of people on FaceBook, Twitter, LinkedIn, Google+ and the rest, but sometimes I don't think we understand how to use them.  In and of themselves, these sites offer a way to stay in touch with family and friends.  And just to be upfront, I would probably not have any of these accounts, if it were not for the business, for the same reason I prefer to stay away from Malls, I do not wish to be bombarded with marketing messages.  However, I do find it useful at times for product research, or to see if an idea actually exists, or even to read reviews. 

To the individual, there can be a downside to these sites.  Ask former Congressman Wiener.  And do you want the pedophile across town to see your kids or grand kids?  And yet people flock to them.  I would rather email that cute picture to my daughter, or wife, or son, than post it on FaceBook.  And I would rather discuss my feelings than just Tweet it from the mountain. 

The politicians are embracing social media to get out the vote, and I suppose that is OK.  But what can they say in 140 characters to sway your vote?  It encourages negative campaigns.  Businesses need to be able to promote, but is there no place safe anymore?  And I understand that advertisers are paying for these sites, so they can be free.  Do people actually read the ads?  Or just view it as a necessary evil? 

There is a lot of competition out there to have your message heard for marketers.  Over 5 billion posts per week on FaceBook alone, should help understand the problem.  As an example I would guess no one reading this post has even seen an ad on FaceBook for our company, even though we pay to have the ad broadcast.  It seems that these sites are all about content, and not so much about distribution.



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The economic bottom line will always be, what does my participation do to enhance my business?  If the answer is not enough, then these sites should see a downturn in ad revenue, which seems to be happening.  Large Companies seem to still be embracing this marketing, especially as more traditional marketing is not as effective.  DVRs are killing TV marketers as an example, the Post Office is losing money, and print media is quickly becoming extinct.  And the auto makers are installing Internet connections that could impact radio.

As a businessman, if you were to ask me 20 years ago where to put advertising money, the answer would have been pretty simple, the newspaper.  Today, with circulation down, that is not the case.  Now I would say browser search.  But people are doing digitally, what they did on TV, going past the ads, to see the content.  Even though those ads are at the top and down the sides, they make it obvious that it is an ad.  As a consumer, I find it important to see what a business says about itself, but also what others say about the business.

Our large sized competitors even put a game app up on the Apple Store.  Will that really convince you to buy their mattress?  We are in a state of change, to predict the outcome would be hard.  Social media will survive, at least for a while, until something better comes along.

Economics will rule out.  If there is a definable benefit to these sites, their ability to earn money will grow.  If not, then they will falter.  If you are a fan of these sites, please support the advertisers.  If you can see your way clear, like us on FaceBook :-) And as always....

Spend Well!