May 12 , 2009

Building relationships can increase ROI
Using social media to grow your business

Although mass branding remains important, building relationships with your online audience is more effective for ROI, according to Dave Stevens, General Manager, MySpace Canada.

Online users are investing a lot of time in online social engagement and at last week’s Massive Technology Show in Toronto, Stevens told business owners how to leverage this influential audience or “taste makers” to evangelize their brands.

First and foremost, he stressed, your content must have value to the user.

“Users can be sceptical of content and brand associations,” said Stevens. “So as a company you have to ensure that the content you provide leaves the user feeling as if their investment of time has been rewarded.”

A great way to do this is through audience participation, he said, citing the highly successful McDonalds Big Mac jingle contest. During this social media campaign, consumers were invited to submit their own versions of the well-known Big Mac jingle on MySpace.

“The benefit to the advertiser, in this case McDonalds, is that users were investing time with the brand and spreading word of mouth. The users were literally singing about the product and creating messaging.”

By allowing their audience to participate in their brand, McDonalds saw increased traffic in their stores, bigger brand awareness online and, most importantly a spike in sales.

To see favourable results, businesses have to be willing to have a long-term strategy in the social space and avoid one-off relationships with consumers.

“This is where most businesses fail,” said Stevens. “In order to build and maintain relationships you have to be committed to giving users regular updates and advice, whether that’s in the form of content updates, coupons or promos – users value consistent relationships.

“You need to build a conversation and then listen to consumers’ needs. You have to treat your audience as valued friends and talk to them instead of pushing content. And don’t kill negative feedback as this destroys your credibility.”

Hyper-targeting is where it’s at

Participation in social media sites can also help businesses move forward in the world of online advertising. According to Stevens, the future of online ads lies in hyper-targeting, which allows advertisers to get better conversion while delivering more relevant ads to consumers.

“With hyper-targeted campaigns you may have smaller numbers but your conversion rates will be higher than with mass media,” said Stevens.