In 2013, Does Facebook Work For Small Business Marketing?

It seems like more and more lately, people ask me whether or not it’s worth their time and or money to advertise and market on Facebook.

My answer is that it depends on how big their business is, whether they’re trying to produce sales leads, build brand awareness, etc. So here are some circumstances where Facebook marketing can work and doesn’t work.

Small business that advertises on Facebook (pay per click ads) and wants more phone calls (aka sales leads)

Facebook’s pay per click model is no different than other forms of display advertising. Currently, in 2013, it’s statistically ineffective for small businesses. We at Customwave have tried it every which way and there’s not enough calls for all the money spent on clicks for our small business clients to make money. I believe it’s because a lot of clicks come from people accidentally clicking on the ads on their small mobile device screen. If you run a small business and you’re paying for ads on Facebook, you’re wasting your money.

Big business that advertises on Facebook (pay per click ads) and wants more phone calls (aka sales leads)

If you work for a big company that everybody knows of, paying for clicks with Facebook ads will produce more sales leads and customers. So why do Facebook ads work for big business, but not small businesses? Because #1, the big business won’t need as many clicks to produce sales leads because of how familiar consumers already are with the business. So the click to call conversion rate for a big business will be much better than a small business’. Plus, the big business won’t care if they get clicks accidentally because building brand awareness is already their primary strategy.

Small business that socializes and networks with people they know on Facebook and wants more phone calls

This is the one way a small business can market themselves on Facebook and have it work. But it requires knowledge of how Facebook works and lots of time chatting with people. It requires meeting new people, building a relationship with them and then hope that if the time comes when they need your service, they’ll go to you. Very similar to how real life word of mouth business works.

Big business that socializes and networks with people they know on Facebook and wants more phone calls

Most big businesses don’t have to network online to produce calls or sales leads because people already know who they are. Big businesses will usually have people work on their social media accounts just for customer support and general marketing.

Small Business that advertises and pays for clicks on Facebook ads to build brand awareness

If you have the money to burn, this is a long term strategy that can work. But if you’re struggling to make payroll this week, I certainly wouldn’t recommend it. In the long term, making consumers aware of you over the course of a year, 2 years, 3 years, then advertising to them trying to produce sales leads will be even more effective because of how people are familiar with you. Facebook can absolutely help you with that by paying for clicks with their ads. But it’s not going to do too much right now.

Big Business that advertises and pays for clicks on Facebook ads to build brand awareness

And here we get to the main way Facebook is currently able to stay a float right now. Big business loves the vast amount of ad inventory and reach Facebook offers and does it simply to continue to have top of the mind awareness with consumers. And they don’t mind paying for accidental clicks because after all, even if someone clicks on the ad and sees the big business, the big business achieves their goal which is the consumer being reminded of them. It’s the same reason Coke and McDonald’s advertises just their logo in lots of places. All they need to do is remind you of them for their marketing to be successful and Facebook gives them another place to do that.

So there you go. Internet marketing constantly changes and next year Facebook may make major changes where people will start to use their website in different ways, but in 2013, this is how marketing and advertising on Facebook works.

 

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People Who Say They Can Get You On The 1st Page Of Google Guaranteed With SEO Are Lying

Search Engine Optimization is The New Pyramid Scheme.

I am so sick and tired of search engine optimization. Mostly because I’m sick of clients coming to me saying that someone solicited their business and told them all these wonderful tales that if they do x, y, and z, they’ll be on the first page of Google for sure without having to pay for any of the clicks. Below is an email that a client sent to me this afternoon:

———————————————

Hi,

My name is Deborah and I am an Online Marketing Representative.
 

The reason for my email is I have come across your site  and decided to run an analysis on your competition and your current search rankings. I also tried to look for your business on various social media sites and really couldn’t find much else about you.

Over the last 12 months GOOGLE has placed so much importance on Content Creation & Social Media Performance that if your business isn’t creating valuable content or even visible across social media platforms you have basically no chance of being seen on any search engine for keywords your customers are using to find businesses like you.

With a solid plan and strategy I honestly believe I can help get your website ranking higher on GOOGLE and getting customers to interact with your business on Social Media to really build your brand.
 
Can I call you and run some ideas I have to help your business grow? 

———————————————–

Let Me break this down:

There is no such thing as a blueprint to have success in search engine optimization. If you apply the same practuces to 10 websites, you will have at least half of them fail to get on the 1st page. At least. Probably more than half will fail. Deborah is making guesses and selling them as a guaranteed result.

Google makes sure that there’s no one size fits all approach to getting any one website on the 1st page. Google is in the business of making money and they make ranking on the 1st page difficult because they want you to pay for website visitors. They don’t want you to get all these clicks for free.

Small businesses don’t need their brand built by social media. They need new customers and increased sales. Period. Next.

All this search engine gobbledygook to small businesses is a pure waste of time. It’s been proven over and over by companies like mine at Customwave and others, that the best approach is to pay Google to be on the 1st page. Then skip over this whole giant “getting on the 1st page of Google without paying for clicks” mess.

You skip that whole entire thing and move onto more important steps like, are the website visitors converting into phone calls and sales leads. Are the phone calls equaling new customers? Do I need to target different keywords to get better quality sales leads? Those are the things a small business needs to concentrate on.

But someone like Deborah won’t talk about making sure that the website traffic or “social media” presence turns into phone calls. Or if the phone calls will equal new customers. She only talks about getting you on Google. Why? Because I bet most of the time, she never gets to the phone call part. Probably because she can’t even deliver on getting someone on the 1st page of Google.

And if you’ve already seen my client on the 1st page of Google, than I have obviously already done something that you can only claim you can do.

I’m so sick of people like Deborah because they get my client’s hopes up and then waste my time because I have to bring the client back to reality and inform them that people like Deborah are a fraud and scam.

I wish these people would just go away back to the pyramid scheme they came from.

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Most Local Florists Are Leaving Money On The Table

It’s like this in almost every small business industry. There’s only so much supply of internet marketers and way too much demand of all the millions and millions of small businesses that need help in just the most basic internet marketing needs.

I read an infographic by vsplash that showed that despite the rough economy, valentine’s day brings in billions of dollars of business. But unfortunately the small business local florists are leaving money on the table by not being found on the first page of Google, making it difficult for potential customers looking for florists in the local area.

The research shows that 45% of florists websites don’t have an address on their website, an astounding 40% don’t have a local phone #, and a ghastly 90% don’t have at least one photo gallery showing on their flowers! Unbelievable!!

There are many, many more industries in the small business community hurting and really needing help marketing themselves online. This, along with people more and more using their TV with the internet, is why most Wall St. and business analysts predict that the internet marketing industry is going to be seeing rapid growth in the next 5-10 years.

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Video Ads On Facebook The Solution For Advertisers?

The short answer: Nope. All Facebook is doing here is putting lipstick on a pig.

I’ve said this many times. Facebook’s problem is that it’s website is not a destination for where people go when they’re looking for things. Google is one of them. Even yellowpages.com is one of them.

Facebook’s main problem is that the clicks cost way too much money. People advertise on Facebook paying for the clicks because they’re told they need to. That Facebook is the next big thing. But the clicks to calls conversion is too low for advertisers to make money.

In reality, Facebook is no different than any other display advertising network that charges $0.05 for a click when Facebook charges $1.00. Google can get away with charging $2.00 to as high as $10.00 a click because the clicks to calls conversion rate is way higher. Why? Because people purposefully go to Google to get something done. People click on the Facebook ads out of happenstance.

Now Facebook wants to bring video in the mix thinking that this may be the next big thing, but the same problem remains. People will watch the video and may click the ad out of curiousity, but it doesn’t mean they have a need for what the advertiser is selling.

If you’re a small business, don’t give your money to Facebook. Please. Let the bigger companies figure out how to use Facebook to increase sales. You might as well flush your money down the toilet! At least using the toilet won’t waste your time like Facebook will.

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Where Should Your Internet Marketing Dollars Go Right Now?

I wanted to make a quick summary on what internet marketing techniques are perfect to invest in right now. Which ones are too experimental and would be better to invest in the future. And which marketing techniques you’ve missed the boat on and you’re too late.

It’s Too Late

-SEO: People had gangbuster success with SEO in the 2000’s. If you got in early, you not only got loads of free website traffic that generated sales leads, but you also got very valuable real estate on the 1st page of Google. In 2013, the people that are currently on the 1st page of Google usually don’t go anywhere. So if you want to crack the 1st page for keywords that are very competitive, maybe after a lot of hard work, maybe you can reach the 1st page after a year or so. Maybe. No guarantees. To spend a bunch of money in SEO these days with the hope of getting 2005-like results is like spending money on going to California because you think the gold rush is still going on.

-Shopping Carts: For small businesses that have shopping carts, they live and die off organic, seo traffic. They can’t afford to pay what large companies pay per click because the large company will almost always have a higher conversion rate. Why? It will take a large company less clicks to produce a sale on average because consumers are already familiar and will be more likely to trust the big company than some small company they’ve never heard of before. And because brand new SEO campaigns are almost impossible to be successful, the ship has sailed on shopping carts. The only exception would be if you’ve found a niche market and there’s no competition. Then the possibility for seo success and shopping cart success is out there.

Maybe Later

-Social Media: The past 5 years have shown that Facebook doesn’t drive up referral and word of mouth business. People just don’t do it. They use Facebook and other social media sites to socialize. Paying for clicks on Facebook is no different than any other form of display advertising, it’s just more expensive. If you’re a small business, you’re way better off letting someone else figure out the social media puzzle.

-Display Advertising: It’s on the rise and looks more appealing, but affiliate networks like Google need to do a better job localizing and properly segmenting the traffic. The conversion rates from clicks to sales leads is still ridiculously low because the location net is too wide and the segmenting isn’t specific enough. But I think Google will eventually get to where they need to be and that display will be a viable form of internet marketing by maybe 2015.

Internet Radio Advertising: I almost put this in the do it now category, but here at Customwave, we’re probably going to wait another year before completely jumping in and recommending it to clients. Too experimental right now, but it definitely has a future. I wrote a separate blog on it here.

 

Do It Now

-Pay Per Click: This is our bread and butter at Customwave. If you know what you’re doing, it works like gangbusters! You should have to know how to make sure the clicks you’re paying for convert into calls.

-Reputation Management: Lots of demand, not enough competent supply. Business owners are starting to pick up on the importance of their reputation online and it’s very do-able to help people with it.

-Email Marketing: An old school approach that still works as long as the people that are receiving your emails are familiar with you and interested in what you’re selling.

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Does Your Business Need Google+?

Lately, I’ve been seeing people in the industry talking to small business owners about Google+ and it’s the next big thing and if you can get your business on it. there’s a big opportunity to increase sales.

Wrong.

In order for Google+ to bring you in more business, there needs to be people actively using it. As of right now, people have set up Google+ accounts, but they don’t spend any time on it. Most people are still loyal to Facebook and kill their time there.

What’s the value of being on Google+ right now? Really, there isn’t any value in being on there.

I believe that most people misunderstand the value in social media marketing. I should right a blog post in the future about it, but for now I’ll say that the value is in building relationships with people. Just like in the real world when you network. I see people creating posts on Facebook selling, trying to spur up conversation and those people that do that are better off just going to the beach or watching TV. Again, a topic for another day.

Something that sickens me is that you have “internet marketing companies” advertise Google+ to small business as if they “need” to be on it. That it will “increase” visibility. It’s garbage. They’re just trying to make more money and take advantage of the small business owner’s lack of knowledge in internet marketing.

Google+ will only be valuable to be on when there are millions of people that spend tons of time on it. Right now, that time has not arrived yet. Therefore, I would say the current value of being on Google+ is in the pennies.

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Facebook is Still Not a Viable Business

I know, I know, you might be reading the title wondering what the heck I’m talking about, but just humor me here. Yes, I know Facebook is not Myspace. I really doubt people are going to stop using Facebook anytime soon. I use Facebook a ton myself. So where’s the substance in my provocative title you ask?

Let me sum it up. Facebook’s advertisers are not making money. And make no mistake about it, Facebook is in the advertising business.

And I’m not the only one who’s seeing red flags. Below is a quote from Veronica Stecker, a media manager from retailer Gordmans Inc,  in Wall Street Journal story:

“We still don’t have a huge correlation between Facebook fans and return on investment in an actual sales in store. Until that metric becomes a lot more solid, I don’t think our company or other brands are going to be full-fledged into Facebook advertising.”

There’s a monstrous difference between Google and Facebook. Google is a destination. When people are looking for something, they go to Google. Advertisers make money because of that and Google is thus successful.

The past couple years, businesses, big and small, have been spending money on Facebook as an experiment and/or because everybody else is doing it. But we’re reaching a point where the economy continues to tighten and people are starting to ask each other, is this advertising even doing anything?

Facebook may have the biggest tech IPO ever shortly, but I think their biggest challenge lies ahead. Unless they figure out a way to help advertisers make money, which they’ve been trying and failing for the past 5 years, their revenue will dry up. Investors will question the business. And Facebook will be in all sorts of trouble.

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How Small Business Can Actually Benefit From Facebook

Of course everyone by now has heard of Facebook. And when small business owners have seen bigger businesses benefiting from Facebook, they’ve of course decided to try it themselves. But there’s a lot of bbad information going around leaving a ton of small business owners with a bad taste in their mouth.

Back in January, i blogged about a chart from emarketer about the 9 main benefits of social media marketing. But let me be clear. That chart applies more often to bigger companies. A lot of the benefits listed aren’t relevant to small businesses because they don’t have enough people “liking” their Facebook page. Because of this, “monitoring what is being said about your company”, “improving customer service”, “resolving problems” and a few others don’t apply.

Now, there’s lots of companies selling $1,000 a month and $500 a month “social media marketing” packages. In my humble opinion, they’re selling snake oil. As of right now, there’s a general consensus in the industry that there’s no evidence suggesting companies are profiting off large social media investments. They’re still working on it and making progress, but we’re not there yet. And most people who will tell you different and that small businesses are making money off of spending thousands of dollars off Facebook, are probably the same people selling these social media services.

At Customwave, we do have a social media marketing package. We keep it simple, provide the basics and do only what we know works for sure. We charge $25 a month for it.

There’s 2 main ways small businesses indisputably benefit off of Facebook. We post regularly on our clients Facebook pages with relevant content. For people who have never heard of your company before and they find your Facebook page, our clients will look like experts and authorities in their industry. This is the type of thing that convinces people to actually go through and do the job with you after they find your phone #.

The second main way Facebook benefits will have to do with how many people “like” your Facebook page. The more, the better. Because once someone “likes” your Facebook page and we post content, the content will land in their “news feed”. It’s very similar to email marketing, except in my opinion better because most people these days spend more time on Facebook than their email. This is how small businesses can generate referrals off Facebook.

These are two sure-fire ways that small businesses benefit from Facebook. Everything else at this point on Facebook is theory and experiment.

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52% of People Stop Using Twitter Because It’s “Pointless”

According to ExactTarget, 52% of people who’ve left Twitter and no longer use it, said they stopped “because it was pointless.” That’s a pretty strong rebuke. Primarily, the problem Twitter has is that everybody is on Facebook and only some people are on Twitter.

Twitter has close to 16 million people in the US who use it at least once a month. Facebook has close to 150 million. Twitter and Facbook are mostly tools to communicate and socialize. If the people who you want to communicate and socialize with aren’t using Twitter, there’s no reason for you to either.

The reason why people started using email is because after a few years, everyone gradually got on it and used it. That’s what makes email important. The number of people who use it.

Twitter will not be universally relevant until their user base increases dramatically.

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Where Small Business Is Marketing Online

The following list is from a survey done by MerchantCircle on where small businesses are spending marketing dollars this year:

Facebook – 70.3%
Google – 66.2%
LinkedIn – 58.2%
Google Places – 51.4%
Yahoo – 49.2%
Yahoo Local – 45%
Twitter – 39.8%
Citysearch – 39.7%
Yellowbook – 39.3%
Superpages.com – 33.3%
Bing – 33.2%
Yelp – 32.2%
Facebook Places – 32.2%
YouTube – 26.8%
YP.com – 25.6%
Ask.com – 19.9%
MySpace – 19.2%
Foursquare – 8.7%
Groupon – 6.6%
LivingSocial – 5%
Gowalla – 3.4%
Bizzy – 2.5%

Google is not surprising, but Facebook and LinkedIn being #1 and #3 is. At least to me. My guess is that entrepreneurs hear about social media and figure “Why not? It’s Free.” From my experience though, most small businesses that have these social profiles set them up and let them sit there, hoping people automatically find it and call them. I hope word gets out that you need to actively use it and engage people for the whole thing to work. Social media marketing is not like the phone book where you stick an ad in and people call.

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