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Social Media for Business: Is it Worth it?

June 22, 2018 • Social Media

As we discussed in the last blog post, almost all Canadians are on social media – 91% of Canadians use at least one platform. And boy do we love it: Canadians spend more time on social media than any other European or North American country (44 hours a month on average). So this is where Canadians are, but is your business there too?

When people consider using a marketing strategy in their business, they are typically looking for new customers. They start posting offers and expect new clients to start doing business with them immediately. Success is measured, in their eyes, directly in increased sales from new clients.

The problem is that social media doesn’t work like that.

Although it does increase traffic and sales to your business, it is not a quick or direct route to sales. It is, instead, another avenue for developing relationships. Those relationships result in benefits to your business, including your bottom line. But it takes time and commitment.

Let’s talk about exactly what a good social media strategy can do for your business:

  • Increase brand awareness
  • Legitimize a brand
  • Drive traffic to website
  • Increase sales
  • Provide better customer service

Increasing Brand Awareness

Around 83% of businesses using social media say it has helped them to increased exposure for their business. If you want people to know about your business, you need to be where they are looking. And Canadians are looking on social media. One of the best ways to use this medium to acquire new customers is through your existing customers.  71% of consumers who have had a good social media service experience with a brand are likely to recommend it to others.

Legitimize a Brand

63% of consumers who search for local businesses online are more likely to use businesses with information on social media sites. Being on these platforms makes your business seem more legitimate and allays fears and concerns that you might disappear. A solid online presence creates a sense of stability and credibility for you and your business. This is what allows you to build a loyal fan base.

Drive Traffic to Website

75% of businesses using social media say they’ve increased traffic to their website. In 2015, Forbes reported that social media drives 31% of all referral traffic. Once people get to your website, there are many factors that will determine whether or not they will become clients (we talk about some of those factors in this blog post). But traffic is the first step: it is the equivalent of getting someone’s phone number. This doesn’t necessarily mean a date (and it sure doesn’t mean marriage) but it gives you an opportunity to sell them on you.

The good news is that even if you don’t get the date, getting people to simply come to your website helps. Even if they never buy, traffic helps other people find you in the future (by boosting your reputation with Google as a place worth visiting!)

Increase sales

The vast majority (73%) of people who follow a company on social media do so because they are interested in the service or product. This means that you are typically talking to potential customers (or existing customers) when you engage on these platforms. Because of this, more than 50% of businesses who have been implementing social media marketing tactics for at least two years have reported improved sales.

But the surprise to most people is where the increased sales come from: existing or repeat customers. Customers report spending 20% – 40% more money on brands that have interacted with them on social media. This strategy isn’t primarily about gaining new customers; instead, it strengthens relationships with existing customers. That might not sound as glamorous, but it is better for your bottom line. Businesses that grow their customer retention rates by as little as 5% typically see profit increases ranging from 25% to 95%.

Provide Better Customer Service

More than a quarter of users would rather engage with a company on social media than at a physical location. It is typically consumer’s (especially young consumers) preferred platform to receive customer care. Whether you like it or not, this is where customer service is happening.

When it comes to sales, the probability of selling to an existing happy customer is up to 14x higher than the probability of selling to a new customer. This means that using your social media to provide excellent customer care is one of the best investments you can make in your business.

If you are known for good customer service, you can also charge more!

So…is it worth it?

Social media isn’t typically top of the list for new business users who need to increase cash flow immediately. It takes an investment of time. But if you are looking for steady and reliable growth and loyalty from your customers, a strong social media strategy not only should be part of your plan for your business, but in 2018, it must be.

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