How B2Bs Can Capitalize on Social Media

Google, Facebook and Twitter can drive sales

by John Hiatt from an interview at the Softletter SaaS University Conference

“I know half my advertising budget is wasted … I just don’t know which half.” So said Philadelphia retail magnate, John Wanamaker, around the turn of the century. Not much has changed since, when it comes to using print and broadcast media to drum up business — whether you’re targeting upscale consumers or busy CIOs. And it’s a compelling reason for the shift away from traditional marketing and sales toward online or so-called “new media,” according to online marketing guru, Rajiv Parikh, CEO of Position2.

Today’s buyer wants to make a connection and have a conversation, Parikh says, especially in the B2B space. “In a recent study by Marketing Sherpa, 80 percent of B2B buyers said they found what they were looking for through online research,” he says. “They want to find what they need, not have it pushed at them.”

The trend is not going away anytime soon. The 2008 Cone Business in Social Media Study revealed the depth and breadth of social media interaction with companies:

• An overwhelming majority (93 percent) of online Americans say companies should have a social media presence, and 85 percent believe these companies should also interact with consumers through social media.
• Some 60 percent of Americans interact with companies using social media, one in four interact more than once per week, and 56 percent feel both a stronger connection with and better served by companies when they interact via social media.

Research at Texas Instruments substantiates this in the B2B space. The company launched an online community  targeting design engineers and found that engineers who joined it and participated were two to six times more likely to engage with the company by downloading product sheets, ordering samples or buying developer kits. That translates into substantially higher revenue.

Tapping into social media

Social media may sound a little nutty, says Parikh, but it makes good business sense, especially when you are targeting a technically savvy audience. “Millions of people are online today, joining groups with similar interests in Facebook, LinkedIn or Twitter. They use social media as a way to promote and educate themselves, and to learn more.”

Another advantage: Less defensiveness. Parikh puts it this way: “The technology allows people to get out of their usual place, and to find people with similar interests in similar fields, without having to be face to face. Something about conversing online takes away barriers that would be there otherwise. People are more open to sharing.”

There are tens of thousands of groups on Facebook and MySpace, with well over 100 million members worldwide, he says. “In marketing, you want to go where the people are, and they are online now — they’re not watching TV or reading magazines and newspapers.”

Of course, some groups aim at people who went to the same college, or share an interest in collecting beer cans. But TI identified several groups of design engineers. And Parikh routinely uses Twitter and Facebook to promote Webinars and events for clients of his consulting firm. “People already join user groups or go to trade shows to network, so why not use Facebook or LinkedIn to achieve the same result? In fact, it increases people’s comfort level because they can see my profile and know I am knowledgeable. Potentially, you learn more than you would if we sat side by side at dinner.”

Where to start

Parikh recommends researching how your target market uses the Web. “Look for forums and groups on Facebook, MySpace, LinkedIn, YouTube and Twitter. Explore areas of interest, and track your competitors’ online presence. They may already have blogs, Twitter followers, material available for downloading or an e-newsletter. In essence, you want to survey the landscape and ask, ‘Where are my users?’”

Social media is a huge thing, and if you don’t define clearly what you want to accomplish, and the behavior you want to drive, it’s easy to get lost. “You don’t want to say, ‘We need to be on Facebook’ just because everyone else is there.”

Next, develop a cohesive social media plan, tied to the way your target audience uses the Web. “If your target audience is mostly readers, you may want to have a blog. Alternatively, if they are talkers, a forum or community may be the best alternative,” Parikh says. For instance, you may want to include the following components:

• A Twitter presence, which you can use to highlight relevant product developments, trade show activities, pertinent media coverage, industry news and trends. Followers could include customers, hardware and software developers, students, professors, employees, field sales, distributors, reporters and analysts.
• An online community or forum, which can include blog-type postings, videos, podcasts and monitored conversations among customers, prospects and others.
• Conversation agents, typically employees assigned to identify, track and participate in relevant conversations taking place online. Note: Make sure these agents contribute valuable content to the current discussions.

Your best bet is to try three or four different things to see which works best and delivers the kind of results you need. No one solution will fit everyone, Parikh says. Your best bet is to start small, with a clearly defined pilot project, and expand from there. That is the only way you will get buy-in from the others on your team.

Define what success means

In social media, “engagement” is the metric that businesses most often measure. This includes, but goes beyond, click-throughs or time spent on a site, to track participation in conversations, downloads, samples ordered and other “touch points” along the path from suspect to prospect in the marketing funnel.

“You will find that the cost per lead is much lower, compared to leads from other sources,” Parikh says. “But the quality is higher, because they are engaging with you. And the relationships that develop are broader, deeper and longer lasting than those coming from other sources.”

Rajiv Parikh is CEO of Position2, a search-engine marketing firm with operations in the U.S. and India and a growing suite of worldwide clients. He is co-founder of EffinFunny & Apieron Biosystems with prior management background at AltaVista, Sun, NCR and AT&T. Parikh’s educational background includes an M.B.A. at Harvard Business School and a B.S. in electrical engineering at the University of New Hampshire.