Social Network Marketing Meets Small Business

In mid-June, when computer maker Dell announced it had earned $3 million in revenue from using Twitter, a popular micro-blogging site, the Internet and blogosphere were all atwitter about the news. Finally, proof that social media had the potential to not only increase traffic but also sales. Though as Dell was quick to mention, it took 18 months to make that first million via Twitter, albeit only six to earn the last.

The Nauti-Dog Company (Click for larger image).

While Dell is a large corporation, with revenues of more than $61 billion in 2008 alone, smaller businesses – significantly smaller businesses – can also benefit from using Twitter as well as other forms of social media, such as Facebook and MySpace. It also includes blogs, particularly community blogs aimed at entrepreneurs, like The Toilet Paper Entrepreneur, which features hundreds of small business owners every week and sites like Help a Reporter Out (HARO), which links businesses with journalists for free. (Think of it as PR 2.0.)

That’s because unlike traditional PR and advertising, which can be costly, the main cost associated with social media is time, not cash (though this may be changing, thanks in part to success stories like Dell’s). And any business willing to spend some time on social media/networking sites, building a community or fan base can benefit.

That’s the beauty of social networking. “It levels the playing field and provides small business owners another platform or medium to leverage from a marketing perspective,” said Scott Bradley, a social media strategist who runs the blog Networking Effectively. “Social media also fosters closer and better company-customer/prospective customer interaction – call it Word-of-Mouth 2.0” – than do the more traditional print advertising and PR he said.

To find out how small businesses are using social networking sites and tools to market themselves and to build better relationships with their customers, we spoke with three retail business owners. While their products and audience may differ from yours, their tips and advice regarding social media can be applied to any business.

Old-Fashioned Boutique, Modern Marketing Strategy

The James Store is a 63-year-old clothing boutique located in Granville, Ohio. With its charming brick façade, big bay window and colorful awning, the store seems the product of another time. And in many ways it is – or was, until just a couple of years ago. That’s when the James Store set up shop online and shortly thereafter began using Facebook, YouTube and Twitter to attract new customers and “build relationships and communicate with customers both locally and around the country and the world,” said Peter Morse, the James Store’s marketing director.

“So many people use Facebook every day that it seemed important for the James Store to have a presence there,” explained Morse. “It wasn’t exactly clear how we’d use it initially, but it seemed like only a matter of time before it was widely adopted and the value became apparent. In the meantime we began building a fan base. And our customers (who love our store and are very loyal) happily become fans.”

The James Store rewards its fans by offering store coupons that are only available via the company’s Facebook fan page. “It drove new fans to our Facebook page – which in turn drove foot traffic to the store,” said Morse.

As for Twitter, the capability to instant message store updates to customers and followers in real time appealed to Morse, and he’s been using the service to alert customers to sales and specials.

“Recently we tweeted about a sale on Vera Bradley handbags. When Vera Bradley retires a handbag style, they discount the price – and many people wait for the day this occurs to get a deal,” explained Morse. “When we tweeted about the sale, we received phone calls from customers from all over the U.S.”

Moreover, every time the James Store posts a new tweet, it automatically becomes an update on the store’s Facebook fan page, driving even more traffic to both the physical and virtual stores.

“The reaction has been great,” said Morse. “Facebook keeps the store feeling up-to-date. And we have found these social media tools to be more effective than e-mail in getting out the word about sales and events – and much cheaper as well.”