When the computing and connectedness industry began its meteoric rise in the 1990s, IT vendors and users alike scrambled for new ways to utilize the growing capabilities provided by the internet and broadband communications. Among the most attractive of these was Customer Relationship Management (CRM). 

Around since the early 1990s, CRM initially focused on the relationship between vendors and their known customer base. It evolved from a one-way gathering of customer information to a two-way relationship in which the vendor could give back to customers in the form of discounts, gifts and special offers. While this growing interaction between vendor and buyer had some of the characteristics of today’s real time marketing world, it was limited by technology to a relatively small share of the overall buying public. That has changed as the world of connectedness has virtually taken over the world of commerce.

With social media all the rage, it’s no surprise to see firms clamoring to reap the rewards of social media marketing. But whether this new channel will actually shower goodies on firms that practice it is still an open question. If it does, much of what we think we know about how to market products, services and corporate reputations must be rethought in light of a growing social media market. If it doesn't, then we’re on the cusp of another time and money sink. 

Social media’s ability to drive better sales and market penetration is difficult to measure and far from settled. While some claim that social media marketing is new -- even revolutionary -- and that organizations must get with it or fall behind, others point out that it is, after all, marketing. All the old rules still apply, even if they're extended somewhat by the new communication channels.  

What Can We Count On?

At its base, the only goal that matters is -- or should be -- selling a product to some portion of the population.  Whether it's a product, a service or simply a warm fuzzy about the seller’s organization, everything comes back to the classic buy/sell process. Whether more “likes” means more sales has yet to be conclusively demonstrated.

The question for fledgling social media marketers is how to find the people on their Facebook, Twitter and Instagram pages and convince them to actually buy something. When they’re surfing a social media site they can be very difficult to distract even for a moment, let alone dislodge. So, while finding and getting to potential customers is a worthy goal, finding them through social media may actually be more difficult than originally thought. 

Merely understanding who these social media users are is a challenge in itself.

The rise of social media has changed the way target audiences and markets break down, impacting the traditional view of demographics like age, sex, income, marital status, education and geographical location. Marketing programs developed to aim at any one of these categories must now deal with social media users whose behavior cuts across demographics in ways that can make targeting much more difficult.

Engaging Your Customer 

Research suggests that social media users are resistant to one-way, or “shout" marketing, with on-screen ads and the delays caused by downloading sales graphics and videos typically receiving the most negative responses.

Standard market demographics don’t tell us much about this phenomenon, so if the social media marketplace doesn't much like being advertised to, what do we do to get them to like us and buy our stuff?

Some commentators tell us that we should deal with social media users by getting them to “like” (or the equivalent outside Facebook) our pages and post things about us on their pages. Somehow, the idea of influencing social media users to use more social media sounds -- and may be -- a little circular.

Where Social Can Fit In

The internet can be very useful as an information medium, offering us insight into what and where things are going on. Online tools, whatever their nature, can tell potential customers about us in ways they are more likely to believe than the standard “we’re the best” advertising.

Sites like Angie’s List, Home Advisor, Trip Advisor and even product reviews on Amazon and other e-commerce sites give companies credibility they need, no matter what they're selling. The question is, will social media users saying nice things about us carry the same weight as people whose business it is to evaluate products?

One school of social media marketing tells us that we need to engage social media users where they live -- on social media sites themselves, using sophisticated analytic tools to measure what kinds of responses we are getting to our social media campaigns. Still others tell us that we must seek to know what our prospects, customers and former customers are saying to each other about us and where they are saying it. While all of this may be true at the structural level, none of it tells us much about how to convert this engagement into sales.

What to Do?

Companies should start by figuring out what will encourage prospects and customers, first time or return, to buy a product or service. Regardless of where the journey starts, firms need to know just how much effort is involved in buying their goods and how much motivation the customer needs to make the purchase. 

When all buying involved was going to the store, convincing someone to buy required just enough motivation to get in the car, drive to the store, search the shelves and buy something. Retailers provided the impetus by offering specials, discount coupons and other motivational tools that made the consumer feel he could get something special if he came in. J. C. Penney’s decision to drop their specials and discounts a couple of years ago showed just how effective these tools were as the firm’s business tanked.

But with the presence of Amazon.com and other online vendors, which offer discounted prices from hundreds of vendors all in one place, the marketing value of incentives -- though still useful -- has been diluted. 

Changing the Game

So how does social media factor into the buying decision? One way is its potential as a public relations platform. In their book “The Fall of Advertising and the Rise of PR,” Al and Laura Ries argue that most of the major marketing and brand successes of recent years have been built on public relations, i.e. making the market aware of things about a brand which could positively influence public opinion, with the goal of driving sales -- often with little direct advertising.

While that may be a bit of PR hyperbole, it is nonetheless a good reason to focus social media efforts on letting consumers know things about your company that are likely to encourage them to buy from you. We might even call these efforts “social media information,” and as marketing guru Bill Belew tells us, “do your content right and your content will be the little piggy that goes to market for you.”