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11.21.08 Is Social Media Marketing Worthless? 
By Peter Da Vanzo
Social media is the next big thing! No, it's the big thing! It is here, now, and it is big! Let's face it, if you're not aboard the cluetrain to social media marketing city, you're sitting on that station alone! A pity, then, that social media traffic is so often worthless. Worthless? Let's look at the market signals. Why is it that you pay dollars per click on Google Adwords for financial keywords, yet the same keywords on social networks are priced at five cents? This suggests to me one of two things. Either the social networks are seriously underestimating the value of their own traffic, or most of the people on social networks aren't interested in commercial messages. If they were, then the bid values would closely match those of Google Adwords. I think the latter is the most likely scenario. Social media traffic isn't priced higher, because it isn't translating into revenue for the advertisers. This isn't happening because the intent of the users when engaged with social media is not conducive to selling stuff.
Of course, social media traffic isn't all bad. We'll look at some ways you can benefit from it. But firstly, let's compare and contrast some aspects of social media marketing and search marketing, in order to help clarify the value proposition. 1. Traffic Is Not An Asset, Traffic Is A Cost Traffic only becomes an asset when it translates into something else. When it becomes a bookmark, a sign-up, a link, or helps establish a genuine relationship. It must also result in an increase in revenue. If it doesn't, then traffic remains an expense. What is the value of 10,000 Diggers hitting your site to look at, say, a picture of a monkey riding a bicycle? Zero. The trouble is that a lot of marketers are watching the web scorecard - that spike in the visitor stats that shows the number of visits - and using that as a marketing metric. "Hey, I'm popular!". Sure, with 10,000 teenagers amused by a picture of a monkey riding a bicycle. But how is that helping boost revenue? There isn't a lot of meaning to such a relationship. It is low value. "This is a truth of the Internet: When traffic comes to your site without focused intent, it bounces. 75% of all unfocused visitors leave within three seconds.Any site, anywhere, anytime. 75% bounce rate within three seconds. By unfocused, I mean people who visit via Digg or Stumbleupon or even a typical Google search... "I'm just looking," is no fun for most retailers. Yet they continue to pay high rent for high-traffic locations, and invest time and money in window displays. Very few retailers lament all the traffic that walks by the front door without ever walking in. A long time ago, they realized that the shoppers with focused intent are far more valuable. Smart retailers work hard to get focused people to walk in the door and to keep the riff raff walking on down the sidewalk.".
2. Uncontrolled Message It is difficult to control the message. Released into the wild of social networks, the message can just as easily result in negative effects as positive ones. Continue reading this article.
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