FOR INVESTOR'S BUSINESS DAILY
Posted 2/23/2007
Forget about must-see TV. Blogs are a must read by many people.
While newspaper readership drops, the buzz is about blogs and social networking Web sites like MySpace and Friendster. Business types are finding that blogs and social sites are about more than chatting online. Blogs can be awesome generators of new clients and leads.
When Martin Schwimmer, an intellectual property attorney, started a law firm in Mount Kisco, N.Y., in 2001, he had no budget for marketing. To generate buzz and interest, he launched his trademark blog (schwimmerlegal.com), writing about patent issues. Most people find out about it through his Google ad or via other bloggers.
Based on the traffic generated by the blog, he says that in 2006 about 50% of his referrals stemmed from clients who read his blog. "My blog creates unsolicited contacts. I strike up e-mail correspondence with readers, and sometimes they generate referrals," Schwimmer said.
Creating your own blog helps spark publicity and enhances a company's credibility, says Andy Sernovitz, chief executive of the Word of Mouth Marketing Association, which is based in Chicago. "People are already talking about you and your business right now on social networks and blogs. If you want it to be positive, you need to jump in and participate," he said.
If blogs drive people to your Web site, it boosts business, Sernovitz says. "In a word-of-mouth world, the No. 1 source of product recommendation is people like us, not professional reviewers or Consumer Reports," he said. "The overwhelming majority of purchases, close to 60 or 70%, is based on people turning to friends."
Meeting sites such as Evite (owned by IAC (IACI) ) and Meetup, business-to-business Web site LinkedIn, and News Corp.'s (NWS) social networking site MySpace can also be tapped to find new clients.
David Teten, co-author with Scott Allen of "The Virtual Handshake," says this is especially true if leads are contacted via friends or one's social network. Teten says that 83% of e-mails generated by contacts are returned.
Sernovitz said Web sites "serve different communities and have their own rules about which type of marketing is appropriate. The most important thing for people is to learn the rules and culture of each community."
MySpace concentrates on music, movies and entertainment, Linked- In is more appropriate for marketing services, and Friendster focuses on personal social networking, he says.
LinkedIn can be particularly effective in generating new business, Sernovitz notes. He advises writing a vivid personal profile incorporating a description of your business, avoiding too much self-promotion, which will turn readers off, and then use discussion groups to build relationships. "On B2B blogs, the key is doing favors for others, which helps build relationships. They owe you one and will recommend you to others," he said.
Marketing a business on a blog or social Web site can be a more effective tool than networking at a conference or generating leads via traditional ads, Teten says. Three-quarters of the people you meet at a conference aren't your target customers, and in advertising the truism is 50% of traditional advertising is wasted on people, but no one knows which 50%, he says.
On MySpace, Teten says, a fashion designer can use a member's profile to target potential clients who say they buy jewelry or accessories. Though MySpace restricts large businesses from sending e-mail blasts to 1,000 people, an entrepreneur can target profile pages on a one-to-one basis to identify potential clients.
Teten, who runs Nitron Advisors, which offers independent research, joined a Yahoo group of fund managers and then targeted them as potential clients. Teten described chatting with people on these Web sites as equivalent to attending "a cocktail party with people, which can lead to new business."
Gather.com, a social site, attracts "engaged, informed adults that connect around everything from politics, foods, creative writing and travel," said Tom Gerace, its chief executive, who's based in Boston. Gather.com has 140,000 registered users who chat online and also participate in events held by authors or political figures.
Michael Abrashoff, a former Navy commander turned consultant, public speaker and author of "Get Your Ship Together," joined the leadership forum at Gather.com. On the site, he published some provocative articles on the failure of military leadership that generated lots of buzz. As a result of his postings, Gerace said Abrashoff's book, which was published three years ago, zoomed to No. 15 on Amazon's best-seller list.
"Abrashoff was extending his brand as a thought leader in business. He addressed one of the key questions for business people: How do you play in a social space?" Gerace said.
On Gather.com, Smartbargains, a discount Web site, started a contest for members, asking them to explain why a room in their house needed a makeover. The winner earned $1,000 in furniture. Over 1,300 people participated, again generating buzz and presumably new business for Smartbargains.
But don't these online marketing efforts turn a social site into one extended sales pitch, alienating its members? Gerace disputed that notion, saying: "They're not getting a direct sales pitch. Advertisers must create value in the community and can't pretend to be people in the community."
Advertisers are banned from using the site for blatant commercial selling but can create their own social group. A record label, for example, like Blue Note could start the bluenote group for people who love jazz.
On Gather, Starbucks (SBUX) hosted a live chat with Mitch Albom, author of "The Five People You Meet in Heaven." Starbucks sells his book at its retail stores and also includes a link on Gather to buy the book. "Users respond to efforts that are aspirational, that give them an opportunity to do something," Gerace said, such as asking questions of Albom.
Teten advises that businesspeople join meeting sites such as Meetup or Gather to find people in their industry. Expand your network to develop potential clients. Doing things for fun, such as joining book clubs or aficionado groups, can also increase your contacts and ultimately lead to more connections and clients.
Teten also recommends that businesspeople read blog readers, such as bloglines.com, to ascertain what readers are saying about their blogs. "It offers one-stop shopping for reading multiple blogs," he said.
Teten says if businesspeople make their intentions clear, they won't be misleading anyone by trying to sell on a social network site.
Sernovitz added, "The most important thing is to learn the rules and culture of each community and be careful to stay within those boundaries."
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