When the internet first came out, everyone viewed it as a “net add” in terms of cost – it was “another storefront” in most people’s mind. They had their traditional media ads on the Radio, TV, and in print in the newspapers, yellow pages, and direct mail pieces. Since the internet wasn’t viewed as and “either or” it was viewed as “another” way for the audience to find you. This was logical and unfortunately expensive since it was an entirely new cost and in many cases a department. But Social Media REPLACES many aspects of your current model instead of just adding on – and it will continue to move more in this direction over time.
Many people liken Social Media to the Internet. They are similar with their “game changing” capabilities but very different in many ways. The internet was clearly a more “technology” solution. While there is some very cool and powerful technology associated with Social Media, it is really a “business solution” rather than a “technology solution.” And since it is a business solution, that means it is either improving some aspect of your business or creating a new one – but it is not focused on replacing or improving existing technology.
In simple terms, when something isn’t working any longer, we get rid of it and “replace” it with something new and improved. We don’t keep it around and spend money on it. This is the same situation with Social Media and Traditional Media. I won’t bore you with all the studies and reports, we’ve all seen them – traditional media is bleeding red ink in every form. So if your direct mail program is returning less and costing you more, or if no one is calling you off your yellow pages ad, or you aren’t getting any response from your ads in the newspaper/magazine/TV/radio, then why continue. These are all costs you can eliminate.
But the smart money is going back into the business in the form of social media. The money these businesses are NOT SPENDING on traditional media is being recycled and put back into Social Media. This makes it a REPLACEMENT COST instead of adding more onto the marketing or communications budget. The smart thing to do is STOP spending money on media that is not giving you a return and costing more every day and put it on the “new media” that is generating buzz and awareness and engagement and will return more than anything in the traditional categories. So my encouragement to CEOs and Business Owners is to think of this as a “replacement cost” for all the media you should be getting rid of, as hard as that may be for some of you. But if you have money to burn (and I don’t know many that do these days) you can certainly do both, it just isn’t the right business decision.