transformers: How to Making Money

Jamie Turner is the chief content officer of the 60 Second Marketer, the online magazine for BKV Digital and Direct Response. He is also the co-author of How to Make Money with Social Media, now available at fine bookstores (and a few not-so-fine bookstores) everywhere.

Given the hundreds of social media tools available, and the thousands of different ways to use them in business, you’d think that getting Fortune 500 companies on board would be a complex and daunting task.

But it’s not. The truth is, there are only five different ways the Fortune 500 use social media. Seriously — just five. And once you know what they are, you can figure out which ones would be most useful for your business.

These five social approaches, though different in many respects, all have one thing in common: Each of the Fortune 500 use them to generate a profit. After all, they’re not using social media just to be social. They’re using it to make money.

In order to make money with social media, you have to set up your campaigns to be measured. And I’m not talking about simple metrics like number of followers or unique page views (although those are important). I’m talking about real metrics like leads generated, prospects converted and profits realized. Those are the kinds of metrics that enable you to track the success of your social media campaign on an ROI basis. And when you’re tracking your social media campaign on an ROI basis, you’re making your CFO happy (along with your CEO, your CMO and everyone else in your company).

1. Branding

Some companies use social media strictly as a branding tool. Typically, this means running a YouTubeclass="blippr-nobr">YouTube campaign that (hopefully) gets a lot of buzz around the water cooler. While using social media strictly as a branding tool might be considered “old-school” these days, it can still generate some positive sales growth.

Take Toyota as an example. Its YouTube mini-series featuring the Sienna Family has generated more than 8.3 million impressions. Those are not passive impressions fed to consumers during a TV commercial break, but engaged views attained through social sharing. When people share your commercial with their friends, they’re reinforcing your marketing for you, and it’s the best kind.

Of course, one of the most successful campaigns of this type is the Old Spice YouTube campaign that has more than 140 million impressions and, according to Nielsen, helped sales increase 55% in three months, and a whopping 107% during the month of July alone. Part of what made this campaign successful was that Old Spice set it up so it could quickly respond to viewers’ comments about the videos. By engaging the viewers in the videos, Old Spice improved the stickiness of the campaign and, best of all, enhanced the viral nature of it.

2. e-Commerce

If you can sell your product or service online, then you’ll want to drive people to a landing page on your website where they can buy your goods. How can you accomplish this? Just do what Dell does. It tweets about special promotions for its folloers on Twitterclass="blippr-nobr">Twitter. Right now, the DellOutlet account has 1.5 million followers. If you crunch some hypothetical but fair numbers on the back of an envelope, Dell’s ROI might look something like this:

DellOutlet followers: 1.5 million
DellOutlet followers who actually see the promotional Tweet: 50,000
Followers who click on the link in the Tweet: 500
Prospects who purchase a computer based on the Tweet: 50
50 purchases x $500 computer = $25,000

That’s $25,000 in revenue just for sending out a tweet. Not bad for a day’s work. Of course you’ll have to put in the effort to build your Twitter community in the first place, but those are certainly resources well spent, given the potential return.

3. Research

Many companies are using social media as a tool to do simple, anecdotal research. Sometimes, this involves building a website that engages customers in a dialogue. Starbucks has done this famously with MyStarbucksIdea.com. When visitors land on the site, they’re asked to provide new ideas to Starbucks on ways to improve the brand. Visitors can share ideas, vote on which ideas they like the best, discuss the ideas that have been submitted, and even see the results of their suggestions in action.

But you don’t have to build an entire website to keep tabs on your customers’ needs. Got a blog? Great. Ask your visitors to leave suggestions in your comments section. Have an e-newsletter? Terrific. Use the tools from ConstantContact, ExactTarget or MailChimp to include polls and surveys in your e-newsletter. Active on Twitter? Wonderful. Then use Twtpoll, SurveyMonkey or SurveyGizmo to drive people to a survey page on these sites.

The bottom line is there are plenty of ways to keep your finger on the pulse of your community’s needs, using social media tools that are readily available to both you and the Fortune 500.

4. Customer Retention

A good rule to remember is that it costs three to ﬁve times as much to acquire a new customer as it does to keep an existing one. Given that, wouldn’t it be smart to use social media as a tool to keep customers loyal and engaged? That’s what Comcast and Southwest Airlines do. They communicate via Twitter, class='blippr-nobr'>Facebookclass="blippr-nobr">Facebook and other social media platforms to help solve customer service issues.

When Frank Eliason at Comcast first noticed that people were making comments about his company on Twitter, he probably wasn’t very happy. After all, if you’re going to Tweet about your cable company, it’s likely a complaint. So Frank took things into his own hands and started Tweeting back to the disgruntled customers. His tweets offered suggestions and tips on how to fix the problems people were having with their services.

Research has indicated that if you take a customer in a heightened state of anger and help them out, they’ll actually become brand advocates. In other words, they start promoting your brand to others because you reached out to them and helped them at a time of need.

That’s what happened with Frank and Comcast. Customers went from being disgruntled to being brand advocates — all because they were pleasantly surprised when Frank reached out to them via Twitter and helped solve their problems.

If you find yourself reading negative comments in the blogosphere about your brand, don’t shy away from them. Engage with them. You’ll be surprised how effective it can be.

5. Lead Generation

If you’re having difficulty selling your product or service online, you may want to invest in a social B2B lead generation strategy. At my company, we use social media to drive prospects to our online magazine for marketers. When prospects get to the website, they can read a blog post, watch a 60-second video or download a white paper. Once we gather their contact information, we (gently) re-market to them by reminding them of all the great results our partner generates for its clients.

This hub-and-spoke system works like a charm. Why? Because B2B and professional service firms are often sold based on a relationship. Much of the decision process is based on a vendor’s reputation and trustworthiness. What better way to build trust than by providing helpful, useful information to the client prospect via social media?

Remember, when you’re using this hub and spoke system, you don’t want to limit yourself to just the big five (class='blippr-nobr'>LinkedInclass="blippr-nobr">LinkedIn, Twitter, Facebook, YouTube and MySpaceclass="blippr-nobr">MySpace). You’ll also want to use e-mail marketing, speeches, e-books, webinars, blogs, videos and other social media tools to build trust and awareness.

More Business Resources from Mashable:

- 5 Ways to Sell Your Expertise Online/> - Why Your Business Should Consider Reverse Mentorship/> - 35 Essential Social Media & Tech Resources for Small Businesses/> - 6 Ways to Score a Job Through Twitter/> - 4 Misconceptions About Marketing in Social Games

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This post is made possible by Microsoft BizSpark as a new part of the Spark of Genius series that focuses on a new and innovative startup each day. Once a week, the program focuses on startups within the BizSpark program and what they’re doing to grow.

Consumer electronics search engine and review site Retrevo had the best traffic day in its four-year history on Monday. But unlike Cyber Mondays of the past, site visitors who were browsing the site’s comprehensive reviews also had the option to buy electronics without leaving the Retrevo site.

In the past two months, the company has been dipping its toes into e-commerce — an industry that it plans to dive into fully next year. The site’s long-time sources of revenue have been advertising and cost-per-click fees it collects by referring its users to electronic retailer sites. Since launching e-commerce components, such as its daily deals, it has more than doubled its monthly revenue.

To complement the new strategy, the company is launching a new search engine today that allows consumers to search accessories, the major portion of its product offerings, by entering a specific electronic device they wish to accessorize.

Taking this leap into e-commerce was something of a risk for CEO Vipin Jain. E-commerce is a decidedly different industry than review indexing, and there was a question of whether readers who trusted the site for information would also trust the site with their money (the answer thus far appears to be that they will).

class='blippr-nobr'>Mashableclass="blippr-nobr">Mashable recently chatted with Jain about making the transition that he says is likely to triple annual revenue.

Building a Strong Frame

Retrevo built a 6-million-unique-users-per-month user base for its search and review engine before it decided to start selling products itself. And although selling electronics is turning out to be much more profitable than recommending them, the four years that it spent refining this system were an important component in building the site’s e-commerce success.

For one thing, customers already trust the site. “We probably would not have had this much success with e-commerce if we had not gone through building the trust with the information and reviews and recommendations first,” Jain says. “I think that where we are and where we think the company is going to be, I think that is a result of having that belief in the recommendation and the advice we are giving them. It is easier for them to open their wallets and give us money to buy products.”

It’s also unlikely that consumers would choose to buy from the site if it were just another Amazon-like retailer. The comprehensive reviews, which make it easy for people without a lot of technical knowledge to pick out a product, is the reason that people will continue to visit the site. And, as Jain sees it, the commerce component is a way of completing this easy-to-navigate experience. Instead of sending customers to a third-party site that might be confusing, users can easily complete their checkout where they started their search.

Changing Course

Earlier this year, when Retrevo started planning for the switch, the staff didn’t have any delusions about what a drastic change the company would be making. Retrevo sought new talent from online retailers like Newegg.com and eBay to help its team think in e-commerce terms.

“We were the king of the hill in our old world (CE reviews and recommendations),” Jain says. “E-commerce is full of potholes, and we are going against big guys such as Amazon. Amazon can be very aggressive when it comes to pricing for items that they want to move.”

Instead of competing with Amazon down to pennies, Retrevo’s advantage needs to come from helping customers buy the best products for their needs and get the most out of them. The accessory search engine that launches today, for instance, helps customers find the right accessories based on what devices they have. If the accessory doesn’t work with the device, the company will accept the return with no questions asked.

It would seem that selling and recommending devices on the same site might be a conflict of interest, but Vain insists that it is no more so than when the review site has hosted advertisers like Sony in the past.

“I think we have established over the years that Retrevo is a trusted place and the reviews and recommendations that we give you have not been influenced by any business model or revenue model,” he says.

Because being a reliable source of decision-making information about products is the key to its e-commerce strategy, it seems like much of Retrevo’s success or failure will depend on whether this statement holds true.

Image courtesy of class='blippr-nobr'>Flickrclass="blippr-nobr">Flickr, Chuck “Caveman” Coker, Dean Terry

Wednesday 8 December 2010

How to Making Money

1. Branding

2. e-Commerce

3. Research

4. Customer Retention

5. Lead Generation

More Business Resources from Mashable:

For more Business coverage:

Building a Strong Frame

Changing Course

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