A Smart Financial Move: Market Socially

UBS has forecast global ad spending will fall 3.9 percent in 2009. In such an environment, social media could prove to be a cost-effective way to sell to consumers.

Getting Social: Salento Flickr Meeting in Lecce, Italy

More Bang For Your Buck

According to the Forrester Research Report, word of mouth strategies such as blogging and social networking will withstand the estimated 3.9 cut in advertising spending in 2009.

In the previous economic downturn Internet advertising was looked on as foolish. In the 2001 recession, US advertising dropped 9% and Internet advertising plummeted 27%, according to Veronis Suhler Stevenson. Marketers turned to tried-and-true media in droves. Why will marketers turn to social media now?

“Last time around, there was a lot of mindless investment in online,” said Forrester analyst Josh Bernoff. “People were dong it because their competition was doing it or because it looked cool. Those are good reasons to stop doing it when money tight.”

Now, many companies are dicovering that social media applications can be useful and cost effective marketing tools. For example, Forrester found that Procter & Gamble’s BeingGirl.com, an online community for adolescent girls, is four times as effective as a similarly priced marketing program in traditional media.

Soaring Growth

A study conducted by Netpop Research found that social networking sites such as Facebook and MySpace have been growing at an average of 93 percent annualy since 2006. Facebook alone has soared in popularity, growing by 500 percent between 2006 and 2008.

“Social media will play the same role in this recession that movies played in the Depression,” said Cate Riegner, Vice President of Research at Netpop Research, “The growth of social networking is still accelerating and the bonds consumers are developing with friends and groups of like-minded people are just beginning to shape behaviors.”

Facebook to Face

SMM is a solid marketing strategy, but make sure not to stop short of the real world. In a recession communities will turn inward, travel shorter distances, and look to their neighbors, family, and friends to share in their bad times and — if you’re marketing team is lucky (and smart) — convey the virtues of your product or service.

“In a down market, people want to socialize. Sites like Meetup.com are going to boom during this recession.”, writes Jason Calacanis, founder of Mahalo, in an email to startup companies and venture capitalists.

Engage your local community. Throw events. Make people happy. They will talk.

Put Crayons in Their Hands

OK. Maybe not crayons, but give your market a way to decompress, a method of acting out, or a creative endeavor that may distract them from the hard times.

In the same email referenced above Calacanis continues on to say, “In a down market, people with free time get creative. The blogging boom was not born out of a technological innovation–far from it. In fact, blogging-style software existed for almost 10 years before the boom. Blogging broke out because so many folks were laid off–and pissed off–that they took the time to write down their thoughts.”

Yes. You’re going to have to get creative to help your potential consumers get creative. (or hire us to do it for you)

What You Should Take Away

• Not only is social media here to stay, it is booming.
• Procter & Gamble’s BeingGirl.com is four times effective as a similarly priced traditional marketing strategy.
• Engage your local community (online and offline)
• Help people decompress by giving them a creative endeavor to embark upon.