Why Mom-and-Pops Will No Longer Pay for ‘Social Media Management’

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smalltown1I own a digital media company that operates a network of local news and niche websites on Cape Cod in Massachusetts. We sell advertising, web design, and Internet marketing services to hundreds of  local clients. Most of them are what I call VSBs, or very small businesses, meaning they have fewer than 15 employees.

They’re the proverbial mom-and-pop companies. They’re very loyal customers, and they’re my bread and butter. If I can’t deliver tangible performance results for their marketing dollars, I’m out of business.

As of this year, we no longer offer social media management services. Why? Demand for these services has dropped off a cliff. The social media hype bubble has burst, and most VSBs have not realized their return on investment in social media. They’re not willing to pay my company — or anyone else — hundreds of dollars a month to market their company on Facebook or Twitter; instead they are diverting those dollars to pay per click options, SEO, optimizing their websites for conversion and mobile, or targeted local media advertising.

I’m located in a tourism, resort and affluent retiree market — in many ways the opposite of the urban hipster demographic. Many of our clients market primarily to customers older than 50. This alone makes social media marketing a difficult fit.

Social media marketers will protest, “You’re doing it wrong. All businesses need social media marketing, which if done correctly for a long enough time, will pay for itself.” But, to them, the mom-and-pops of America respond, “I’ve paid thousands; show me the new customers (and the money).”

This is not to say that VSBs shouldn’t do social media marketing or that it never works for them. I give Internet marketing workshops to VSBs in which I give real-world strategies for time-strapped business owners who don’t have a dedicated marketing staff. My blanket recommendation is that they spend one to two hours a week on social media and use an application such as HootSuite to schedule posts to multiple channels. If they have a reasonably tech savvy employee who they’re already paying to do other offline communications, it certainly makes sense to handle social media this way.

Like so much else in Internet marketing, social media was overhyped to the point where local plumbers and insurance agents thought it would make their cash registers ring early and often. These types of customers requested that we manage their social media for them, so we developed and sold this service. We weren’t alone; many online news companies began offering digital agency services about the same time we did.

Here’s what we learned: On Fantasy Island, your clients dutifully send you their promotions and industry news each week, you write the copy, post photos, track the engagement, and their phone rings off the hook.

In reality, where we all live, Ricardo Montalbán has left the building, and the business owner is too busy wearing 17 different hats to send you any material. You create and post the content, run ads and sponsored posts, and increase the fan base. As for the client’s cash register? Crickets.

In my experience, the type of business most likely to realize a social media return on investment are B2C businesses whose customers are younger than 50 and that focus on entertainment, retail, personal services, or tourism. B2B or home services, or businesses catering to older people, do not fare nearly as well.

Burst bubbles aside, here are the top three reasons for nearly all VSBs to invest a small amount of time on social media:

1.  It’s free or cheap, if you don’t count your time as money — or if you add such duties onto an existing employee’s responsibilities.
2.  It is an important way to reach customers younger than 40 and an essential way to reach those under 30. Have an event to promote? Combine sponsored posts with a contest or other creative marketing, and you’ll get tangible performance results.
3.  Sure, social signals are important for SEO. But as far as knowing that inputting X equals Y placement in search results, we don’t know the equation and never will.

When advising some VSBs on Internet marketing (notice I say some, not all), I offer the following reasons for not allocating a significant portion of their (usually small) marketing budgets to social media management:

1.  It’s sharecropping.  You don’t own your social media presence: Facebook and Twitter do. You can invest large amounts of time and money in obtaining likers and developing custom tabs and functionality, and then Facebook can pull the rug out from underneath you by converting to another format (like Timeline) overnight.

2. Half of all Americans are not on Facebook, and some experts think Facebook penetration in the U.S. market has maxed out. This means half of all potential customers (or higher, if your target customer is older than 50) have no chance at all to see your message.

3.  People do not use Facebook, and especially Twitter, with a purchasing intent. When they want to buy a product or service, they use search. This is why it makes more sense to invest in a professional website optimized for conversions and mobile access, and drive traffic to it through SEO, pay per click, and targeted advertising.

I’d be interested in hearing in comments what challenges and successes other publishers are experiencing.

julie_profilepicJulie Brooks (@juliebrooks) is the CEO of eCape, which is based in Massachusetts’ Cape Cod and publishes the community news site CapeCodToday.com and other local niche sites.

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