Of all the advice that business leaders get barraged with, none is more common — or more vague — than the call to boost their involvement in social media. There is, however, a way to get greater ROI from data mining from social media than more traditional marketing.
Concepts like “engagement” and “presence” are constantly thrown around, and although they’re often not directly related to revenue, a business is considered all but dead if doesn’t constantly issue content across all manner of platforms.
But one has to ask: is there anyone who actually gets excited when a brand mentions them in a tweet? Is there really a difference between the spam in your mailbox and the sponsored content clogging up your Facebook feed? Is social media marketing really the next big thing, or just the manifestation of a tired strategy repackaged in a sleeker, hipper wrapper?
Potential vs. Tangible Value
There’s no debating that our awareness of social media as a business tool has risen over the past four years. In 2010, a sizeable 46% of surveyed professionals believed in social media’s potential for their business — and that statistic had jumped by more than 10% by last year.
But for most companies, all that potential has still yet to translate to something actually valuable. A comparatively tiny 14% of respondents said they were seeing tangible results from their social media initiatives four years ago, a number that has barely increased at all since then. Executives seem to be waiting on some tremendous shift to occur, hoping that all the tweets and posts accruing in their accounts will eventually grow in value at some unforeseeable point down the line.
It would be foolish to deny that social media is a tool that can be leveraged to improve your company’s bottom line. By virtue of the fact that almost all your customers use them, social networks provide a clear path to reaching and understanding a consumer base. But perhaps the best way to capitalize on those networks is to listen to and observe what your customers want and do, rather than simply broadcast your existence to them.
How Data Drives Decisions
Social media provides a platform for your brand, but most larger companies already have plenty of those — the medium’s true value is its ability to collect data about its users.
Some companies, for instance, are developing technology similar to that which powers Google’s facial recognition capabilities to predict fashion trends. The software analyzes millions of photos on social media and seeks out the clothes being worn in each one, identifying the colors, cuts, and kinds of clothing featured most prominently. Then, it maps out how popular each photo or post is, how influential the people liking or reposting it are, and sells that customers data to apparel brands.
This is a clear example of how companies can use social media to drive real business decisions that will actually appeal to customers, not just pester them. The data mined from the many networks used by your customers can be processed into tangible business advantages in any number of ways.
The most obvious benefit that mining data can give your customer base is a customized selection of products based on their observed preferences, something that Amazon and Netflix have proven can work. As Mashable points out, big data can even be used to prevent fraud — after all, once you know your customers well enough, you know what purchases they’d be less likely to make.
Social media marketing has a lot of potential to improve your profit margins, but that’s just it — it’s only potential. Big data collected through social media drives real business decisions, including what services and products you should feature and at what cost, not small ones like what your Facebook page’s cover photo should be.