Why Social Media Marketing Does Not Work for Small Businesses

At the risk of offending every social media ‘genius’ out there, social media marketing just doesn’t work for most small businesses. Here’s why.

Dislike-from-small-businessesReason #1 – Terrible advice

All over the internet there is advice on how your business should be using social media to drive traffic and sales. A lot of the advice sounds sensible. Work out a strategy, execute it, measure it, tweak it – and there are a whole host of software providers that are able to help you with that.

But let’s break it down. What is actually involved in executing a social media ‘strategy’ for a small business?

Let’s say they want to start off with Facebook, which rarely happens, because all the ‘geniuses’ are telling them to go after Google+, Twitter, Pinterest, and a bunch of others at the same time. They start using a simple strategy where they spend $300 per month acquiring new fans, then another $300 per month promoting their posts to their fans.

Simple, right? Well, now they have to pay an employee to take care of that, who in turn has to find content that is worthy of the finicky Facebook crowd. I have been down this road and will cost around $500 per month of that employee’s time.

Now they are spending more than $1,100 per month for something which is probably being done poorly, which means the ROI is terrible. On top of that, you are only using one social network. It would probably be more beneficial to hire a cold calling company to place 1,000 calls for that same price.

Reason #2 – Social media marketing companies

Advice from a stranger

I get it. Small businesses should outsource their social marketing efforts. However, when you look at the price tag it makes no sense at all. I recently got 3 quotes from different agencies. The cheapest option was $3,000 per month.

My average client has turnover of about $500,000. 50% of that is spent on labor, 20% on stock or materials, and 10% on fixed costs. That leaves them with $100,000. So now they are supposed to spend 36% of what’s left on the lowest package there is for social media marketing?

Reason #3 – No one likes what they say

If you are a roofing company, no one is going to think it is ‘cool’ to ‘like’ you. Nor are you going to spend the money to make a funny viral video. You want to sell something, but you have to focus on conversations. You constantly have to think outside the box to create compelling, and shareable, content. Who has the time?

Should small businesses just ignore the social channels?

Not necessarily, but they can use them in a way that is free and gives a direct benefits to their business. One client of mine uses Facebook for customer support. He simply tells his customers to like them on Facebook and they can answer any of their questions. Granted, he is a dentist, which means that he gets a lot of questions.

Other small businesses may not be able to do that. If you build custom homes, for example, then you are only going to have about 3 customers per year. In that case it is probably better to use your profiles for social proof.

Use other online marketing mediums first

I am not saying that social media marketing doesn’t work at all. It just doesn’t work for small businesses. Instead, they should be going after online marketing mediums that are designed to sell their products and services such as SEO or PPC. There is plenty of scope to substantially grow the average small business in these areas.


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