B2B Social Media FAQ: How Much Should We Budget?

B2B Social Media FAQ: How Much Should We Budget?
Posted by Brad Shorr

• Community building.

 Connecting with customers, prospects, peers, and potential referrers. This is a daily activity.

• Brand monitoring.

 Scouring the social networks for mentions of your company and products. Also a daily activity.

• Engagement.

 Listening to your communities, responding, reaching out with interactive messaging. Another daily activity, best done in real time.

• Content sharing.

 Writing, publishing, and sometimes scheduling content with links to strategic blog posts and web pages. This can be done on a monthly basis.

• Social network maintenance.

 Keeping your communities free of spammers, updating content, adding applications, etc. Best done on a weekly or monthly basis.

• How big is your social marketing universe?

• What are your competitors doing?

• What value to you place on a new community member?

• What conversion activities are you offering?

• What is the value of a conversion?

• How much time are you willing to invest to achieve a payback?

• A leader:
 someone who is responsible and accountable for results, and for developing all of the creative inputs.

• A dedicated staffer
 who is available 20-40 hours a week to execute all of the five activities listed above.

• Programming support
 to help set up accounts, update templates, install applications and set up/process analytics.

• Social media objectives can be “soft” – things like extending brand awareness or establishing thought leadership.

• Social media objectives can be “hard” – things like driving people from your social media pages to landing pages where they can buy products or download white papers.

• Social media objectives can also be – and usually are – mixed: a  combination of soft and hard objectives.

• A healthy start-up budget for B2B social media program starts at something around $2500 a month. That number is not as big as it may sound if you consider all-in costs for per-hour labor.

• Anticipate a long ramp-up, anywhere from 12 to 24 months. Establishing social media credibility takes time because it is relationship-based. It’s the opposite of PPC advertising, where people are in the market and boom, react to your offer.

A question we get repeatedly from B2Bs that are new to social media marketing is, how much should we budget? There is obviously no single answer, but this post will lay out ideas and guidelines to help you assess what social spend is right for your business.

Minimum Budgeting Requirements

With social media, a large portion of the cost is time.  Setting up a presence on all of the popular social networks – Facebook, Twitter, LinkedIn, Google+ — requires minimal fees, if any. However, to build a community, several activities must be done on a regular basis:

In order to achieve results, a certain “critical mass” of social media presence is going to be required. For instance, if you have five people in your Facebook community, there’s very little you can accomplish regardless of how brilliant your techniques are. On the other hand, having 500 or 5000 people in your community opens up tremendous possibilities.

What the critical mass is for your business depends on many factors. Here are the questions that will help you zero in on program objectives and milestones:

No matter how you fill in the answers to these six questions, from a budgetary standpoint,the key is to not underestimate the time required to execute the social media plan. Most companies do this: they determine they will be satisfied with 1000 relevant Twitter followers in six months, and grossly underestimate how much time it will take to actually make it happen.

At minimum, you should be prepared to devote these resources to your social media program:

The Impact of Conversion Strategy on Budgeting

With this in mind, I have good budgeting news and bad budgeting news.

First the good budgeting news:

Making hard conversions part of the social strategy simplifies and clarifies the budgeting process. If you know an order or a lead is worth “x,” it’s easy enough to calculate an ROI on your social spend.  If you generate $100,000 in new business on a $40,000 budget, you’re in good shape; if it’s the other way around, your program needs an overhaul.

But now the bad budgeting news:

A social program that’s all about hard conversions will probably fail. Social media is above all … social. The “soft side” of social marketing – talking about the weather, selflessly helping your community, showing off your expertise in valuable and sharable content, etc. – these are the things that ultimately persuade people to convert.

Because of this it’s a mistake to let a desire for budgeting accuracy or simplicity drive the strategy of a social media program. It may be difficult to establish the ROI of a program’s brand awareness component, but brand awareness is, nevertheless, intrinsically valuable and contributes to the success of more measurable program goals.

Big Picture Budgeting Recommendations

I’ll try to wrap this up with a few suggestions to help the entire budgeting process along, whether it’s just you making the decisions or a large internal team. Our agency, by the way, works with small and midsize B2Bs in challenging industrial niches such as truck GPS tracking systems and knife safety gloves, so we are used to participating in budgeting discussions on a small and large scale.

Budgeting is essential to social success. Although as I said it shouldn’t drive strategy, budgeting forces discipline. It’s important for your organization to determine very carefully what data to track, how to interpret it, and how to make it visible. Without that accountability, social programs will never continuously improve and pay off.

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About the Author: Brad Shorr is Director of Content & Social Media for Straight North, asearch engine optimization firm in Chicago that specializes in B2B. A blogger since 2005, Brad writes frequently on SEO, social media, and content strategy topics. You can connect with Brad on Google+.