Small Business Labs

What I Learned From the Using Facebook to Grow Your Business Webinar

The podcast version of the Myventurepad webinar Using Facebook to Grow Your Business is now available. 

I was the moderator and learned a lot from the two expert panelists: Clara Shih, author of the best selling book The Facebook Era and CEO of Hearsay Labs; and Jonathan Smart, President of the Jimmy Smart Allstate Insurance Agency in Columbus, Georgia and skilled Facebook user. 

My big take away from the webinar is the trend towards companies, and especially small businesses, starting to use Facebook as a their main landing page on the Internet - or even their only Internet site.  This trend could fundamentally change the nature of the web.   

I also enjoyed hearing tips and techniques that make a Facebook company fan page more effective.  As I mentioned in the beginning of the webinar, while an active blogger, tweeter and user of LinkedIn, we don't use Facebook for our business. 

But after what we learned in the webinar, we're going to.  You should too. 

The Amazing World of Farmville

For those not familiar with Zynga's mega-hit Farmville, it is a Facebook-based virtual farming game.  It has 75 million monthly users and 28 million people play each day. 

Farmville is one of a growing number of hugely popular social games. 

The High Scalability blog has a fascinating (but a bit geeky) article on the growth of Farmville.  It contains Farmville's staggering stats:

The game had 1 million daily players after 4 days and 10 million after 60 days.

Currently, FarmVille has 28M daily players and 75M monthly players 9 months after launch. That makes the monthly player base of FarmVille larger than the entire population of France.

The amount of traffic between FarmVille and the Facebook platform is enormous: at peak, roughly 3 Gigabits/sec of traffic go between FarmVille and Facebook while our caching cluster serves another 1.5 Gigabits/sec to the application.

The business implications of these stats are far too great to list here.  But one thing is clear, Facebook is a prime-time applications platform. 

Steve King Named 2009 SNCR Fellow of the Year

The Society for New Communications Research (SNCR) named Steve King the 2009 Fellow of the Year at their recent awards gala in Boston.  SNCR Executive Director Jen McClure stated: "His vision for SNCR’s potential, his impressive experience and expertise as a business leader and researcher, and his unwavering commitment to the Society’s mission and goals is greatly appreciated, and I am honored to work with him as a colleague on our board of directors and as a Fellow conducting research on behalf of our organization.”

As managing director of Emergent Research and a fellow SNCR fellow, I'm delighted that Steve received this recognition. Emergent Research looks forward to continuing our work with SNCR to better understand social media's evolving and growing role in marketing, media and society. 

The Rise of Social Media Peer Groups

The Society for New Communications Research(SNCR) just released the preliminary results of a new study showing that corporate decision makers are increasingly turning to online social networks for assistance in decision-making.  

The study, The New Symbiosis of Professional Networks, examines the role that social media has on decision-making among business professionals.  Key findings include:

• Professional decision making is becoming more social as decision-makers utilize social network to research, inform and validate decisions.
• Professionals trust online information almost as much as information received in-person. 
• Reliance on web-based professional networks and online communities has increased significantly over the past 3 years.
• Social media is being used by decision-makers of all ages with older (55+) and younger (20-35) being more active than middle aged professionals.
• Decision-makers are using social media to collaborate with more people outside their company than within. 

This study shows the extent social media is disrupting traditional corporate decision-making processes.  It also illustrates the growing role online social media peer groups are playing.   Through the use of online networks and communities, decision-makers are connecting and collaborating with a mix of peers, experts and colleagues from both inside and outside of their companies. 

The final report will be out in a few more weeks, but a detailed presentation of the resultswith lots of interesting data is available at the SNCR website. 

The study was conducted by SNCR Research Fellows Don Bulmer and Vanessa DiMauro.  In addition to being SNCR Fellows, Don is VP of Global Communications at SAP and Vanessa is the CEO of Leader Networks.  Don has more information on the study on his blog.

The Rise of Social Games

Social games are online games that are played on social networks like Facebook or MySpace, or on smartphones like the iPhone. 

One of the most popular is Zynga's Farmville.  It is a Facebook application that allows users to grow digital crops and sell them for virtual money - which is used to buy virtual items that help you improve your farm such as tractors and tools.  As silly as this game sounds, there are roughly 61 million players around the world. 

The game is social because all the players are logged into Facebook and users can choose to work together or compete with one another.  During my very brief Farmville experience, I neglected to water my crops.  But in an interesting example of the social nature of the game, a friend of mine noticed this and watered them for me. 

Besides Zynga, two other social gaming firms have popular games.  Playfish has 21 million users of its Pet Society game and Playdom has 16 million users for its Mobster game. 

The companies make money two ways.  The first is selling virtual goods to game players.  Using a credit card or Paypal, users improve their game performance by buying items that speed up play or make it easier to reach a higher level in the game. 

The other - and much larger - revenue stream comes from lead generation for companies advertising on the games.  The game companies offer virtual cash in exchange for game players taking offers from advertisers.  Sign up for a credit card or Netflix, buy ringtones or an energy drink and you get rewarded with virtual cash.  The company gets rewarded with real cash.

These companies already have substantial revenues and are growing very rapidly.  Not surprisingly, they are also rumored to be quite profitable (all three are private) - which is not surprising since they are selling virtual goods and trading fake money for real money.   

For more on social games see BusinessWeek's article on the App Economy or the Tech Crunch review of social game companies. 

Is Facebook Taking Over the Web?

With Twitter getting so much attention these days, Facebook almost seems to have drifted into the background.  But the more you look at data on web traffic, the more you realize how big a force Facebook has become. 

The chart below is from Mary Meeker's presentation at the Web 2.0 conference a few weeks ago.  It clearly illustrates Facebook's rapid rise to key web player status.

 

Marketing Charts has another angle on the growth of Facebook.  Their chart (below and sourced from Nielsen) shows the top 10 U.S. Web brands by unique visitors and time spent in September.  Facebook is 4th in terms of audience size and 1st in terms of time spent per person.

 

What is striking about Facebook is not the size of their audience or how much time people spend on the site.  It is their growth rate on both metrics that is impressive.  They are quickly becoming the place people hang out on the web. 

Despite these numbers, the vast majority of small businesses do not need a Facebook presence at this time.  It is not yet a site most customers turn to for business purposes.

But it is time to pay attention to Facebook and start to understand how you can use it for your business - because the day is coming when a Facebook presence will be required.

Why Do Surveys Show Big Differences in Smallbiz Social Media Use?

It seems like there is a new survey on social media use by small businesses almost every day.  It also seems there has never been a topic with such differing survey results. 

Some surveys say 50% or more of all small businesses are using social media.  Some say less than 10%.

The reason is different survey methods are being used and different small business groups are being surveyed.  

Marketing Charts, for example, reports on an online survey by Internet2Go that shows high small business social media use.  The survey authors are very clear about who they surveyed.  From Marketing Charts:

"The survey, which targeted the most frequent content publishers among MerchantCircle’s small businesses members, found that 45% of this leading-edge group have a presence or profiles on Facebook and Twitter and use social media to promote their businesses online."

So this survey provides useful information on leading-edge users and is an interesting look at where the overall small business segment may be heading.  This is great stuff, but not meant to reflect where the broader small business segment is today. 

A recent Citibank survey showed much lower social media use.  They surveyed a broad cross section of small businesses.  It is a good snapshot of where the overall small business segment is today, but provides little information on where social media use is going.

Another example is the BIA/Kelsey survey released this week.  I don't know how this survey was done, but their results - 9% of small business respondents currently use Twitter to promote their businesses - likely indicates a survey of a leading-edge group.  But before I would use this information, I would need to better understand how the survey was done. 

All of these surveys are good, useful and add to our understanding of social media use by small businesses.  But if you just read the survey press releases or short articles on these surveys, it is easy to be confused and think they all apply to the entire small businesses segment.  Unlike the Marketing Charts example, important details about how and who was surveyed are often left out of press releases and articles. 

So as you read survey results, take an extra minute to check out how the survey was done and who they surveyed.  This will cut down on confusion and provide a better sense of how to use the data.

Citibank Survey: Few Small Businesses Use Online Social Networks

A recent surveyof small businesses with fewer than 100 employees by Citibank/CfK Roper found that small business owners are not active users of social networking sites like LinkedIn, Facebook or Twitter.

According to the survey, 76% have not found social networking sites helpful in generating leads or expanding their business.  86% said they have not used online social networking sites to get business advice or information. 

These numbers are not surprising - the results are consistent with other surveys of this group.  The Network Solutions Small Business Success Index survey, for example, found earlier this year that about 12% of small businesses with less than 100 employees use social media. 

The social media use numbers are low because a lot of small businesses are not active online.  Only about half of all small businesses have a website, and many small businesses with websites are not doing much online beyond the website and email. 

Having said that, the use of social media by small businesses is growing very rapidly. 

The use of social media also increases the larger the small business is.  Both the Citibank and the Network Solutions survey results show this. 

And research conducted by Society for New Communications Research Senior Fellow and University of Massachusetts professor Nora Barnes shows that in 2007 39% of Inc. 500 companies (mostly larger small businesses) used social media.  Professor Barnes is releasing her 2009 study on the Inc. 500 later this fall and it will no doubt show much higher social media and online social network use by this group.

So for those who think the numbers are too low, I suggest looking at the glass as half-full.  After all, according to the Citibank survey almost half of all small businesses that are active online have found social networking sites useful. 

Marketers to Spend More on Virtual Events and Social Media in 2010

The always useful Marketing Charts reports on a survey by virtual events provider Unisfair.  It show that marketers are planning to increase their use of online marketing, virtual events and social media in 2010. 

Key findings from the survey of marketers:

• 75% plan to increase their use of social media
• 51% plan to increase their use of SEO methods
• 49% plan to increase their use of direct mail
• 48% plan to increase their use of virtual events

I was a bit surprised the use of virtual events didn't score higher.  They are easy and cheap to do and can be very effective.  Lack of virtual event knowledge and experience seems to be the key barriers to increased use. 

The survey also showed the continued focus from marketers on lead generation, with 60% saying it is their most important objective.

101 Tips from 50 Small Business Bloggers

Glen Stansbury from LifeDev and Gregory Go from Wise Bread reached out to 50 small business bloggers and asked them to share their top small business tips.  The list is at the American Express Open Forum post 101 Tips from 50 Small Business Bloggers.

They got a great response.  Some of the best known entrepreneurs and small business experts contributed their tips including Seth Godin, Mark Cuban, Tim Ferris, Jim Collins, Anita Campbell and 45 others - including Smallbizlabs.

The tips list is divided by business area and the tips are short, to the point and often actionable. 

I immediately got value from reading this list and will refer to it often.