CLAIM : Although many costumers believe that social media marketing and advertising are not powerful in helping small businesses, I claim that social media actually does help small businesses handle their advertising and marketing easily.
In today’s world, many businesses started to use social media as a major tool to market and advertise their products. The utilization of social media is becoming increasingly important and it is giving benefits to small businesses not only in interacting and networking with their customers, but also in marketing and advertising their goods and services effectively. Businesses have started using social media to create awareness about the products and enhance the level of interest of the consumers in the organizations. In the article “Facebook Should be key focus in online retailer advertising” Clint Engel mentions another expert’s view “it’s less important today for a shopper to be present in the store than it is for the store to be present wherever and whenever a shopper needs them”(1). Initially, this trend was adopted by the multinational organizations that had high resources and they considered the use of social media as a way of influencing customers. However, the high penetration rate of social media and the benefits that it provides, has made it easier for small businesses to use it as marketing and an advertising tool. The primary issue of this paper is to analyze the social media as a tool for advertising small businesses, as advertising play an imperative role in the success of every business. However, the success rate of newly established business is low because of brand recognition. High capital costs restrict small business owners to advertise their products. Therefore, social media is one of the tools that can help small businesses advertise their products.
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It is a myth that people believe in traditional advertising more in contrast to social media marketing. The reason is that people are unable to identify their target market which leads them to be unable to sell the products. Nevertheless, the perception of people is changing with the passage of time after the huge success of social media marketing. Multinational brands have also played a significant role in order to change the perception of people about this concern. I believe that social media has a huge significant value for small businesses to promote their products. Therefore, small business owners must utilize social media to advertise their products. However, social media strategies used by small businesses for promoting products or increasing the level of brand awareness, it needs to be focused on the target audience to attain the best results. Thus, there are certain aspects that need to be provided such as: what applications must be used and how they must be used in order to get the best outcomes of the marketing strategy applied.
The use of social media to promote products is expected to bring in higher revenues and higher profits. Additionally, the costs associated with the usage of social media are very low and it provides a great opportunity for small businesses to take an advantage. Furthermore, the increased usage of the internet and social media is another reason that social media marketing for small businesses is successful. In Kyle Hensel’s article “using social media to increase advertising and improve marketing” he states that “businesses have also realized that consumers use social media because it is fun”(4) and the number of people being addressed from the use of social media has enhanced over time. The various benefits that are expected from social media strategy for small businesses include: brand awareness, higher sales for the company, higher acceptance in the market, creation of an effective positioning in the minds of the consumers, reinforcement of the brand name, and the enhancement of the engagement of customers with the brand.
Overall, most of the research studies and the practical aspects of business have been found to restore that the use of social media by small businesses result in better performance and a number of advantages. However, a few research workers have also focused on the challenges of social media faced by the small businesses. These research experts have given higher value to the benefits of using social media to market and advertise for small businesses rather than any other tools. In order to analyze the importance of social media in the sales of the products, the current research has been conducted, which focuses on the literature work to prove that social media is becoming a stronger tool for selling the products online. The use of social media as a tool is not only utilized by the large corporations and businesses, but also by small businesses who are at a greater incentive to use social media to promote products and services. Although many costumers believe that social media marketing and advertising are not powerful in helping small businesses, I claim that social media actually does help small businesses handle their advertising and marketing easily.
1. Advantages of Social Media for Small Business:
Small Businesses marketing and advertising are invading into many social media applications these days. There are a couple major benefits for small businesses when using social media to advertise their goods and services to the customers that were discussed (Gholston). Social media allows small businesses to express themselves and share their goods and services to the customers in a fast way. “Social media is beneficial in regards to it still possess it benefits, advantages, and rewards” (Gholston 25). Social networking advantages outweigh the disadvantages as it really changed the way that small businesses work to be in the market.
1.1 Reinforce Awareness of Brand Name:
Small businesses can utilize the social media to spread their brand and to create a quick constant that would ultimately result in the reinforcement of the brand name. A study was conducted by Hansel and Dais discussing that the brand name is effectively enhanced through the utilization of social media. The tool also increases brand awareness as well as reinforcing it. N. David Milder states that “ a 2012 survey of business to consumer marketers by Webmarketing 123 found that the top objective of their digital marketing programs were increase brand awareness 33 percent” (37). Thus, social media attributes and the benefits associated with it can be easily communicated to the customers through the utilization of social media. Small businesses, which are in need to create awareness about their brand, can get the benefit through social media (Schaupp & Bélanger). It is important to have brand awareness because when customers do, it is one way of having a successful brand.
1.2 Affordable Cost:
Small businesses can get higher sales through the maintenance of social media pages without incurring any cost. However, after the potential customers are aware of the products and the brands they would more likely indulge in purchasing the product. Moreover, the total cost incurred on the entire process of getting orders will cost small businesses nearly zero or just a few dollars spent on advertising through social media pages. As a result of a study shown people spend 5 hours on the internet, amongst which 20% of their time is spent on Facebook (Engel), showing that there are higher chances of engaging the audience through social media leading to sales. The cost incurred on the utilization of social media platform does not require any investment, which could be considered unaffordable by small businesses (Neti). Most of the time it is hard for small businesses to afford paying for marketing and advertising tools such as TV channels. Thus, social media is a neat, affordable tool for all kinds of advertising.
1.3 Data Collection to Improve Customer Insights:
Social media is improving customer insight as well because an entrepreneur can post as much information and images as he wants about a product on social media, which provides people with enough details. The data about the preference of the customers and the statistics about their location can be easily gathered by small businesses through the maintenance of social media pages. The data gathered can be used by small businesses for improving the products or services or modifying the marketing strategy (Carter). Data does not cost small businesses any money, it is good to gather as much information as we could about costumers to easy improve the insight. Knowing what products they like and what prices would be fair to make them happy to purchase. We as small businesses have to make sure that our customers are satisfied and well provided with their needs in order to gain their trust with our brands.
1.4 Enhance Web Traffic & Search Ranking:
The use of social media by small businesses can be helpful in enhancing the traffic on the websites, which would encourage customers to purchase more. Furthermore, the ranking on the search engine is also enhanced, resulting in greater chances of finding the website through the search engine and thus web traffic increases. According to the research conducted by Michaelidou, the use of social media has been reported to increase the customer base of the businesses through attracting new customers. As claimed by Kira Gholston “small businesses must actively participate, have the knowledge needed to run their social media page(s) and develop a strategy which engages their audience” (36). As a result of these strategies, enhancing web traffic and search ranking should be accomplished.
1.5 Sharing of Content and Relationship Building
Small businesses can share the benefits, deals and discounts on products or services without any problems in a faster way. Facebook is one of the widely used and the easiest platform provided to the businesses and the customers to use and interact with each other (Engel). Social media is one of the most effective tools for building relationship with the customers. It provides a platform for both parties to share their views, present opinions, and enhance the loyalty of the customers with the businesses. Therefore, forming strong relationships between businesses and customers. According to the research work conducted by Lisa Harris, et al, “this trend is fundamentally changing the relationship between businesses and their customers” (24). The study was conducted for analyzing the impact of social media on the customer relation in the business to business sector of London and positive results were found among using social media to help small businesses share content and build relationships.
1.6 Richer Customer Experience:
The customers experience of businesses can be enhanced through social media as it allows companies to interact with users to solve their queries and enhance the post purchase dissonance, which ultimately reflects in a better customer experience (Jones). Having a strong customer service and experience is a good path to make small businesses grow faster and have more loyal customers. The use of social media by small businesses can be helpful in creating brand loyalty by engaging with the customers constantly. The level of customer satisfaction can also be enhanced by improving the experience of the customers with the product or services.
2. The Impacts of Social Media on Small Businesses:
Social media impacts small businesses technologically, economically, politically, and culturally. In the article “Impact of social media on small businesses” by Nory Jones et al, “the results of the preliminary survey show that small businesses were aware that the internet and social media have had a large impact on their business; over 95 percent feel it has had a huge(46 percent) or moderate (50 percent) impact”(621). Additionally, the factors that impact small businesses were discussed by many experts in the business field.
2.1 Technological Impact:
The use of social media requires small businesses to establish an online presence. In some case, the presence of a brand online is extended with an opportunity to make online sales. Thus, for this purpose, businesses must shift the general operations of their businesses to the online forum (Evans). For instance, discussing the technological impact on small businesses is the conversion of the physical catalogue to the online catalogue where the customers can review the products and make decision about the purchases. However, this aspect requires the collaboration of the physical environment of the business with the digital one as well as additional budgets for the businesses.
2.2 Economic Impact:
The use of social media forums for advertising and marketing can result in reduction of costs for the businesses due to the traditional form of advertising. It requires extensive marketing budgets, which results in an increase in the costs of the company and leads to a lower revenues. Additionally, the sales of products online also reduces the operational costs of managing the outlet and the physical presence along with the maintenance of distribution channels, thus the usage of social media by businesses is helpful in reducing the costs of the businesses (Shabbir). One of the main values of using social media in small businesses is knowing how to economically manage the company’s revenue.
2.3 Political Impact:
Social media influences the organizations to maintain a proper business culture where the employees of the organizations are provided the basic rights. The production of the products is ensured through the best quality raw material and the ethical dimensions are effectively governed by the management. The fear of spreading the negative word of mouth through social media helps the small businesses in maintaining the ethical practices irrespective of the designation of the individuals working in the organizations. In addition, the laws, rules, and regulations formulated by small businesses organizations are ensured to be in line with the expectations of the stakeholders and according to the national standards set by the government.
2.4 Cultural Exchanges Impact:
The social media is a global forum that is helpful for the people and businesses to share the ideas, customs and values beyond the geographical boundaries. Small businesses could use this forum for creating a cultural impact all around the globe. The products that are marketed and sold through social media can result in wider acceptance of not only the product rather the culture of the origination as well (Chen and Xu). Thereby, all of that vary upon age profiles and attitude and values which leads to a good future of international business and globalization in the business industry.
3. Social Media Strategy for Small Businesses
Social media is different media than other traditional medias. This is why it requires a well-planned strategy to get the maximum results. Small businesses must set good strategies to accomplish what is best for their business. Not only by fulfilling customers’ needs but also which goods and services should be distributed. After a research was conducted, the participants believe that the appearance and quality of content on social media is substantial (Carter). It is good to learn from big businesses as they grew from small ones; for instance, the company Burberry has a good social media strategy. In October 2009 Burberry started its own site on social media which was called Art of the Trench in order to have their customers from all over the world share their experience and pictures with one of their products (Phan). In the article “Social Media and Luxury Brand Management: The Case of Burberry” according to Michel Phan et al, “ as a result of all its efforts, Burberry is the best-ranked luxury brand in the top Social Network ranking by Famecount in 2011 (219). Even though it is not as active to get attention on social media as other companies. Furthermore, David Milder has discussed social media strategy and some of the steps to be included in the development of strategy for small businesses.
3.1 Identifying Goals and Setting Marketing Objectives:
The identification of the business goals is the first step in designing the marketing strategy for social media. It is important that the business goals be identified first because the ultimate results of the strategy needs to be in line with what a company is trying to accomplish. After drawing a path the next step is setting of the marketing objectives. The marketing objectives must be defined as smart goals so that a clear understanding of the goal could be provided to all the relevant people in the organization (Ray). Milder says “one of the biggest mistakes independent downtown merchants make is the failure to first identify the specific marketing objective” (35). Knowing where you want your businesses to be in the future will make you realize if your reaching your business objective successfully or not.
3.2 Research the Competitors
Analysis of the competitors is necessary to frame the exact social media strategy. The competitors and their presence of the various social media forum can impact the market strategy of the business. Thus, it is important to research the competitor for designing an effective strategy. There is a greater chance that the direct competitors of the businesses will be using Facebook pages for promotion, thus looking for their pages and the offers made by them is necessary for taking the next step (Ray). In the book The Next Generation of Businesses Engagement Dave Evans quotes “ ‘it’s not necessarily bad when you do that,’”(4). agreeing with Ray. Looking at what other companies are doing make you aware of the chances and options for your company to succeed more than the competitors (Evans). Seeking around and trying different methods that other companies used before is one of the critical and effective ways to develop a small business.
3.3 Developing Message for Customers:
The next step in the development of social media strategy is creating a powerful message for the customer. The message must be designed as realizing the target audience so that it could have a higher appeal. At the same time, the message for the customers must be engaging. In the current time, various different modes of creating the messages can be utilized. These include videos, written, visual or audio content. The content created for advertising the product or services on the social media needs to be creative, concise and effective to leave an impact on the audience. Making surveys in the applications that provide this tool is a helpful way for developing a message (Evans). Twitter for example, it provides the survey tool for free for all users whether it is a business account or a personal account. The tool itself shows the outcome of the survey after the users participate.
Opponents (Different views):
Opponents might claim that social media is not a helpful tool for small businesses to market and advertise their products. According to the research work conducted by Hensel and Deis, the use of social media marketing is not as effective for small businesses as it is presented. Claiming that social media management requires an expert in the field, the person who would be aware of managing the tools available along with handling the constant feeling for the stakeholders as well as the competitors. They believe that in order to have the requirements of this aspect to social media marketing, a trained individual is required. I agree with Hensel and Deis about having an experience in using social media but in today’s world there are kids who are in the age of six using the media properly. Not to mention the cost of hiring the individual ‘experts’ for social media marketing, provision of training for adapting to the culture of the organization and the shift in technological use of the organization from the traditional to the online forum results in high costs, which is very difficult to incur by small businesses.
I am not a trained individual nor am I an expert. Back in 2014, I opened a small clothing shop that I handled myself. I had the shop open for couple months with variety of goods that consumers like. Marketing was a problem for me and I could not find a good solution even after my family and friends suggested different ideas. So, I ended up shutting the dream of my life down because it was not really that successful. The thing that I figured out from my personal experience was that only limited number of people knew what products were sold at my shop and how could they benefit the lives of the customers. Some of the potential customers were also lost because they were not able to access the shop, as it was not in a crowded area. Thus, overall, it seemed that there was nothing wrong with my products but the placement of the products and the promotion techniques utilized were not up to the media that could have attracted a large number of customers for my shop. This was a great experience and I decided to keep these factors in mind before I take another chance for fulfilling my dream.
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In 2015, I started selling goods again but without having an actual shop. I have all the goods in my house garage. In order to gain more customers, I have decided to use social media to advertise the products and present the benefits and special points of each of the products that I have for sale. Social media was a really good tool in helping me market/advertise my products. The pictures uploaded on the various social media platform helped me in getting the attention of the consumers. After reviewing the attributes of the product that I upload, the potential customers contact me through the options provided by each of the platform and settle the transaction details through online medium. This sort of business model that was based on social media and its advertising has helped me develop my small business and it has earned me a higher profit comparing to my last experience of selling products through a shop.
The purpose of this paper is to discuss the effectiveness of social media in small businesses. The problem that has been identified in this paper revolves around personal experiences that I have had from opening a shop and later selling the products online. My main aim is the analysis of the utilization of social media marketing that would be done in order for the results to be applied to personal businesses. As well as presenting a clear picture for the other businesses operating at the small scale.
The results of the research have revealed that there are various advantages of using social media as a marketing tool for small businesses. The use of social media can help in engaging more customers with the brand and the products, resulting in higher sales. Moreover, reinforcing brand name, improving customer data and insights, increasing brand awareness are some of the benefits that can be achieved by small business at a very low cost. Furthermore, the businesses can enhance the traffic of the websites and ranking on the search engines, improve the experience of the customers, and advertise the brand products at a lower cost than usual.
Additionally, social media marketing has been found to impact the small businesses in a number of ways. Overall, the impacts have been divided into four different categories especially the cultural impact, political impact, social impact and the technological impact. The analysis of the literature has shown that the use of social media requires the management of company to convert some of the other aspects of the business towards the automation and use of technology, thus triggering a process of involving software and high tech instruments in the business. From the political perspective, the social media makes the management of the companies and brands conscious about the ethical practices of the businesses. Culturally, the brands can learn and create an impact on the other brands through the utilization of social media. Furthermore, the utilization of social media lowers the businesses’ advertising and marketing costs creating a positive economic impact.
Additionally, social media strategy for small businesses has also been made as part of this report that discusses the various steps involved in creating an effective strategy that can provide the benefits of social media marketing for small businesses. All these aspects have reinforced that the use of social media by small businesses is effective for creating higher customer engagements and relationship at lower costs, which can ultimately result in increasing profits for small businesses. Although, a few studies have been found stating the negative impact of using social media on the small businesses but overall the benefits of social media usage have been found to outweigh the costs and risks associated with it. Thus, the utilization of social media for advertising and marketing the products can be considered important and can efficiently be used for enhancing the personal sales as well.
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