Remember “irrational exuberance”?
Alan Greenspan used this term in 1996 when talking about the stock market. Lots of people who knew little about the way the stock market works, and even less about how to assess the value and performance of hi-tech companies, were buying up stock in these companies, pushing their value higher and higher. But Greenspan, looking at the data, questioned whether these stocks were becoming overvalued.
Folks who came late to the party, purchasing stocks that were already near their peak values, or who cashed in too late, lost a lot of money when the dot-com bubble burst in 2000.
There’s been a new love affair with internet stocks in recent years, and there is speculation that there will be another dot-com bubble burst. The public has once again soured on stocks that were proven to be overvalued.
Many of the dot-com companies bid up during both bubbles have been social media companies. And, particularly in recent years, the “irrational exuberance” has been fueled not just by stock values, but by excitement over the social media’s potential as a marketing tool.
Social media was touted as a marketing tool with low costs and very high returns. And for some businesses, social media has provided an enormous return on investment.
But just as many people bought dot-com stocks in recent years without knowing how to assess their value, many companies dove in to social media marketing without fully understanding how to use the available tools to effectively reach their market and promote their product.
I have seen clients who became disheartened when they had trouble forming customer relationships simply by establishing a social media presence. I have seen clients who felt they had to follow the lead of major on-line retailers, barraging customers with social media messages and special offers, only to be disappointed by diminishing returns.
Don’t get me wrong, if you fail to include social media in your marketing plan, you will, miss out on some great opportunities. But it is time to set irrational exuberance aside and do your research.
- If you have been using social media for at least a couple of years, take an objective look at your results. You might be surprised to find your ROI was better when you were doing less.
- As you put the finishing touches on your plan for 2013, don’t be afraid to do less. There are so many businesses bombarding consumers with social media messages, that fatigue is setting in. Pick the tools and messages that will make your company and product stand out and get noticed by the people most likely to become your customers.
- Show you respect your customer by reaching out to them when you have something to say that will be worth their time and attention. They will appreciate the thoughtful approach and you will enjoy an improved return on your investment.