One of the top reasons decision makers in B2B businesses put off social media marketing and spending on activity which can help create a web presence is “no instant ROI”. The logic: why pay someone to blog, publish content, share content, comment on others websites and spend time on social networks all day when it doesn’t instantly result in sales? It’s just an ongoing cost which can run for months without a directly proportional result in terms of sales that can be tied directly to this activity.
Most traditional business development decision makers would rather spend on advertising campaigns, email marketing campaigns, telemarketing or buying peoples attention rather than earning trust by building a relationship through social media which can be a much longer process. You wouldn’t be wrong to think social media and the content marketing approach is a slower path to converting attention to sales so it can be put off. However, it would be short-sighted.
You see, developing a content ecosystem and a social media presence is a long term investment much like brand building and not a short term marketing campaign spend like a telemarketing campaign.
So when you look at the term ROI on activities like blogging, sharing, content development and others related to developing an online presence, you need to look at it standing far back thinking what it can do for you several years down the line rather than looking at it up close like a 2 month advertising campaign where you count spend and conversions over this short period. Social media is a long term investment in creating brand pull around your business and that’s the perspective it needs to be seen in.
Real life case illustration
A couple of years ago I was involved with the demand generation team for a B2B service. When it was launched, there were two major components to the customer acquisition process. An inbound marketing lead (just myself) and an outbound pre-sales team of 4 that would run email campaigns combined with outbound telemarketing campaigns to identify potential customers that supported a 5th sales manager that would actually close sales resulting in conversion when a hot lead has been identified by the pre-sales team.
Working of the Outbound Marketing Team
4 resources costing the company $3000 (made up figure) a month each at a total cost of $12,000 a month.
Together they generate approximately 120 phone calls each day reaching about 50 a day of which 2 warm leads would emerge. That’s about 10 warm leads a week of which about 1 would convert into a customer. This team of 4 would consistently deliver about 4 customers a month which was not bad considering this was a service where a single customer would be high value and contribute significant revenues.
The process was linear and the cost of sales constant. The only way to increase sales would be to increase costs.
Working of the Inbound Marketing Effort
1 resource costing the company $3000 (made up figure) a month total cost of $3,000 a month.
As a 1 person inbound marketing resource for a small business, I would spend my hours each day creating a compelling blog post, developing engaging content around the service like slideshare presentations, ebooks, PDFs etc. Promoting and sharing this content across social bookmarking sites, interacting with others on relevant communities across Linkedin groups, doing guest blog posts with industry thought leaders, building a following on Twitter, link building and developing awareness for the service and company.
The first two or three months there was very little traffic, a hand full of inbound leads mainly from decision makers stumbling across conversations and learning about the company. In the next three months we were reaching about 150 inbound visitors a day resulting in about just 10 form fills a month but converting into about 4-5 sales a month since the inbound leads were more qualified and came looking for what we offer. This was at par with the 4 person outbound team.
As the activity continued at the same pace, towards the end of the first year traffic grew steadily towards the website, form fills started to increase and inbound leads were continuing to show steady progress. Conversions were much better on these inbound leads since they came from visitors that had come across us online through our content or conversations, heard about us, reviewed and done most of their evaluation on the website with content provided there and then asked us to get in touch with them since they were interested.
By the end of the second year, the number of inbound leads from the website as a result of the social media and content marketing activity had far exceeded anything the 4 person sales team could come up with who were still at 4 sales a month.
The process took time and effort to yield anything. Once it did, however, it scaled and beyond a point, the returns far outweighed the costs.