Social Media Marketing (SMM)

Social Media Marketing (SMM): What It Is, How It Works, Pros and Cons

What Is Social Media Marketing (SMM)?

Social media marketing (also known as digital marketing and e-marketing) is the use of social media—the platforms on which users build social networks and share information—to build a company’s brand, increase sales, and drive website traffic. In addition to providing companies with a way to engage with existing customers and reach new ones, SMM has purpose-built data analytics that allows marketers to track the success of their efforts and identify even more ways to engage.

Within 18 years, from 2004 (when Myspace became the first social media site to reach one million users) to 2022, the dramatic growth of interactive digital channels took social media to levels that challenge even the reach of television and radio.

Why Is Social Media Marketing (SMM) So Powerful?

The power of SMM is driven by the unparalleled capacity of social media in three core marketing areas: connection, interaction, and customer data.

Connection

Not only does social media enable businesses to connect with customers in previously impossible ways, but there is also an extraordinary range of avenues to connect with target audiences—from content platforms (like YouTube) and social sites (like Facebook) to microblogging services (like X).

Interaction

The dynamic nature of the interaction on social media—whether direct communication or passive liking—enables businesses to leverage free advertising opportunities from EWOM (electronic word-of-mouth) recommendations between existing and potential customers. Not only is the positive contagion effect from EWOM a valuable driver of consumer decisions, but the fact that these interactions happen on the social network makes them measurable. For example, businesses can measure their social equity—a term for the return on investment (ROI) from their social media marketing

Customer Data

A well-designed social media marketing plan delivers another invaluable resource to boost marketing outcomes: customer data. Rather than being overwhelmed by the 3Vs of big data (volume, variety, and velocity), SMM tools have the capacity not only to extract customer data but also to turn this gold into actionable market analysis—or even to use the data to crowdsource new strategies.

How Social Media Marketing (SMM) Works

As platforms like Facebook, X, and Instagram took off, social media transformed how we connect and how businesses can influence consumer behaviour—from promoting content that drives engagement to extracting geographic, demographic, and personal information that makes messaging resonate with users.

SMM Action Plan

The more targeted your SMM strategy is, the more effective it will be. Hootsuite, a leading software provider in the social media management space, recommends the following action plan to build an SMM campaign that has an execution framework as well as performance metrics:

  • Align SMM goals to clear business objectives
  • Learn your target customer (age, location, income, job title, industry, interests)
  • Conduct a competitive analysis of your competition (successes and failures)
  • Audit your current SMM (successes and failures)
  • Create a calendar for SMM content delivery
  • Create best-in-class content
  • Track performance and adjust SMM strategy as needed

Customer Relationship Management (CRM)

Compared to traditional marketing, social media marketing has several distinct advantages, including the fact that SMM has two kinds of interaction that enable targeted customer relationship management (CRM) tools: both customer-to-customer and firm-to-customer. In other words, while traditional marketing tracks customer value primarily by capturing purchase activity, SMM can track customer value directly (through purchases) and indirectly (through product referrals).

Shareable Content

Businesses can also convert the amplified interconnectedness of SMM into the creation of sticky content, the marketing term for attractive content that engages customers at first glance. This gets them to purchase products and share the content. This kind of word-of-mouth advertising not only reaches an otherwise inaccessible audience but also carries the implicit endorsement of someone the recipient knows and trusts—making the creation of shareable content one of the most important ways social media marketing drives growth.

Viral Marketing

Another SMM strategy that relies on the audience to generate the message is viral marketing, a sales technique that attempts to trigger the rapid spread of word-of-mouth product information. Once a marketing message is being shared with the general public far beyond the original target audience, it is considered viral—a very simple and inexpensive way to promote sales.

 

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