Yahoo! Inc.

Over the past four months I’ve had the opportunity to visit a number of markets around the country to give my presentation “The Hidden Power of Social Media: How to Improve Your Networking, Increase Your Web Traffic & Generate More Leads Just by Being Yourself.”

More than 700 people have attended these sessions. The attendees are local businesses, generally small or mid-sized, and have been concentrated among home design and remodeling professionals, real estate agents and apartment managers — the three largest markets that we service at NCI.

Following my prepared remarks there is always a lively give-and-take, driven by highly specific questions about what they should or shouldn’t do. In each instance, the audience is attentive, curious and engaged. They are also uncertain.

One thing to keep in mind about these local SMB’s: Marketing is just one of the things that they focus time and energy on. They think about their marketing in terms of out-of-pocket cash costs and they are conservative. They’ll try new things out, but they want to know just what they are going to get.

Some basic themes have surfaced during these sessions that are worth sharing.

Internet marketing techniques are not well-deployed or well understood by most local businesses.

This has been the biggest surprise. Every business has a web site, but virtually no strategy for identifying, attracting and converting prospects online. In the instances where the businesses have begun to invest time and energy to increase the effectiveness of their Internet marketing, such as the multi-family industry, there is a disproportionate emphasis creating “traffic,” and minimal emphasis on measuring response and conversion. This is like doing a direct mail campaign without measuring how different creative approaches affected response.

The de-facto purpose of most small- and medium-sized business (SMB) web sites is to serve as an interactive brochure for the company. As a result, the sites are valued for fairly subjective attributes, such as the graphic design, the functionality and the composition. When you ask how much traffic they get and how many leads are delivered by their web site, most companies don’t know. For those that do know, they typically get fewer than 100 visits a month. The most frequently used technique to drive web traffic is Google search marketing; here, the focus is on getting the most visits for the most reasonable price, with almost no focus on lead conversion.

Social media is a misunderstood term.

Most SMB leaders have heard “social media” talked about, but they don’t understand what it really is. And, they absolutely don’t understand how using social media could help them accomplish their business goals.

An important part of having a conversation with them is explicitly defining social media tools and helping them understand how access to these tools has changed the way everyone can use the web. The big thing, I say, is that anyone can create and share content, with minimal technical skills. That ability changes the way that people use the Internet; it’s not just a tool for finding things out. It’s a tool for sharing things.

Then, you have to connect how using different kinds of social media tools will help them accomplish marketing goals that they already have. When I talk about the importance of having conversations and connecting with prospects on social networks, people’s eyes begin to glaze over. As I began to explain how different activities would help improve a marketing tactic that they are already doing, the audience got more engaged.

For instance, everyone networks to improve their business. But almost all of the networking happens in person. When I explain how social media tools can help them do more networking with more results, in a tangible way, people get excited.

So, in helping people understand social media, you have to help them understand how it will improve some very basic marketing tactics: Getting their name out in the market, getting more people to inquire about their product or services, creating more opportunities for them to do business and helping to increase repeat business from past customers. This is language that small businesses understand.

Fear and uncertainty are significant obstacles to experimentation.

As people gain a clearer understanding of how they can use social media, they often get much more apprehensive. For many, social media means MySpace or Facebook or YouTube means irresponsible and embarrassing content that can mar a reputation forever. To address this worry head on, I often show the infamous YouTube clip of the drunk guy in the convenience store (see it here, it’s hilarious). My point is that there’s all kinds of content on social media platforms, but that hasn’t discouraged 75% of Internet users from spending more time using social media than search or e-mail.

This fear and a lack of knowledge make it difficult for people to understand that they can separate their personal and their business identities in social media, and that they can manage what kind of content they are sharing and what kind of interaction they are pursuing.

Time is a major obstacle, return a major questions.

As powerful as social media can be to a marketing program, my first admonition to my audience is to measure and value the time they spend doing it. Each hour of time is worth something between $50 to $125 for most people. A task that takes 10 hours a week is costing $500 to $1250. Measure the return on effort against the impact in your business, I suggest.

People frequently ask what amount of time is right. A social media program that is focused on networking and building connections with a Community of Interest should take a couple of hours a week of additional work. An integrated social media marketing program, which includes developing a blog and promoting distribution of your content using social media tools, will require significantly more work, in addition to broader expertise.

And, if you start something, you’d better be committed to keeping it up, because there is nothing as damaging to your Internet footprint as having out-of-date content surrounding your brand.

There is no quick fix or right answer.

This last conclusion isn’t much of a surprise, but I am reminded of it again and again during my discussions.

Internet marketing isn’t highly integrated into the conventional marketing programs of local businesses, and the inclusion of social media tools, as powerful as they can be for these local businesses, requires that the way that the business spends time on marketing and the way that they organize their messages needs to be retooled. Think about the total process and it is very daunting. Most likely, the average local business will shie away and stay focused on easy-to-execute marketing that is managed by someone else.

That’s why at each session, I lay out two things that every business needs to do on the web to take advantage of the time consumers spend using social media.

The first: Claim your digital footprint. That’s the whole footprint. Go out and create identities for your business everywhere — on Google, on Yahoo, on Facebook, on YouTube. You have to create a good quality profile for your business, but you don’t have to populate the identities with content. You just want to be there is someone is looking for you.

The second: Extend your networking into digital. Define a Community of Interest and engage with it on the social web.

Just those two things will give your business, large or small, a foothold and an avenue for gaining experience that will likely blossom into a more energized and effective marketing program.

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