The New Southern Standard

How does this increase sales?

That is the question put forth by Scoble in a recent post. Jeremiah started the questioning in his post, but from a broader perspective. Read the comments for Scoble’s post. They are worth the time. I’m also certain this topic was discussed last week at Enterprise 2.0 .

Let’s tackle the question from a slightly different perspective. There are two sides of the balance sheet. Let’s look at the left side and focus on where I can save money. If we reduce costs our margins improve, cēterīs paribus. The cost side discussion is often more more equitable to medium and large businesses for several reasons. One, the rhetoric of trying something ‘new’ often translates to great risk in the corporate world. And, unfortunately, risk is not a popular concept.

The second reason is the officers are often working from a budget. It is often impossible to ask for new budget dollars, but very easy to re-allocate and shift dollars from the current budget.

Spoiler alert: If your customers aren’t online, this won’t work.

Reduction in trade journals spending traditional ad dollars in traditional channels

Move a portion of the money you are spending in trade journals. You don’t need to retire your entire spend, but buy smaller size ads or reduce the frequency. 25.9% of total B2b 2006 ad spending went to business publications.* There is a fair amount money in the trade pubs.

Reduction in pre-sales travel

Before a sale closes, a salesperson will often travel to the customer’s site to facilitate the closing. This is especially true in companies with long sales cycles and complex products. Reduce the amount of pre-sales travel and use social media to pre-qualify potential buyers and resolve their major issues. With gas prices predicted to reach $5.00 a gallon, spending less money on upfront travel could help subsidize your effort in designing and building a social media campaign.

Reduction in traditional media buys

Similar to the trade journals, re-allocate some of your dollars in T.V., cable, newspaper, radio, and outdoor. Shift some of that money over to a social media campaign.

Reduction in customer support or customer retention

Use RSS, Twitter search, and blog searches to monitor for issues and address them before spiral out of control. This upfront monitoring will reduce your ‘emergency’ funding for customer support. (To be fair, some companies budget customer support separately from other initiatives. If this is you, technically, you can’t re-allocate from the support budget. However, you can gain another champion in the Support leadership by saving her some money.)

Reduction in lead generation campaigns

You could pull some money out of partner programs, trade shows, and other lead gen campaigns in order to help subsidize your social media plans.

(Ultimately, you want to be thinking in terms of returns, not necessarily revenues or costs. For every dollar you invest, you should get more than one dollar in return. )

*Data from eMarketer report

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