Social media and the bottom line

Boss: What are you doing right now?
Employee: I’m on Facebook looking after our business’ page.
Boss: We could really do with a hand out there …
Employee: I’d love to help but social media is SO important.
Boss (muttering) : So they tell me…

Once the boss has left, of course, the employee resumes looking at what their friends are up to, reads their horoscope, plays that damned chicken game and generally wastes time that the boss is paying for.

I searched the internet today to find out the average hourly wage in South Florida. The information was about ten months old but Google told me that the median hourly rate is $15.95. Office workers generally receive $19 – $24 per hour and a cashier at Winn Dixie $8. So for the sake of argument – and easy math – let’s imagine that the employee who is ‘running their social media’ is earning $15 per hour. Let’s assume further that they do this for one hour a day, seven days a week. That’s $105 per week.

It’s actually more likely that it’s longer than an hour a day. These are statistics from January 2012:

Average minutes per visitor to social media sites.
Facebook (405) (That’s 6.75 hours!)
Tumblr (89)
Pinterest (89)
Twitter (21)
LinkedIn (17)
Google+ (3)

So, as most people who are ‘running social media’ for their bosses think that social media is Facebook and Twitter, let’s say that the employee is spending two hours a day.  That’s $210 of the boss’ money per week.  (What they are doing for those hours on Facebook – in a professional capacity – I have no idea). Simple math – three hours = $315 a week. (“But the person who does our social media is our receptionist who has nothing to do all day but answer the phones and do her nails”. “You let your receptionist be in charge of your company’s online reputation????”)

Here’s another statistic. I know, statistics aren’t always the real picture but to give you some idea:

It’s statistically unlikely, according to data that Facebook analytics firm PageLever released over the summer. Information from the company’s beta testers showed that, on average, only 7.49 percent of page fans see posts daily.

So, let’s now imagine that our mythical company has 1,000 followers.  Seventy people see it. Of course, it might not be as bad as that. Let’s be super-generous and say that 500 people see the company’s message. (This is highly unlikely). There is another statistic that says that, on average, 85% of a page’s followers aren’t in the local area – bad news if you’re a bricks and mortar business. But again, let’s be generous and say half are. So 250 people see the message. Let’s remember that ‘see’ doesn’t mean ‘read’. Shall we say that half actually read? OK, so the message goes to 125 people. How many of those are in the market for your product? If you’re selling homes, or maternity wear then not many. But let’s imagine our company is a restaurant – everyone eats, right?

The receptionist social media person has just sent out “Our soup of the day is French onion. Mmmm. Join us for lunch”.

What percentage of the 125 people who see the message eat in a restaurant at lunchtime? Half? That’s generous too. Now we’re down to sixty three people. How many are truly local (within a short drive)? How many other restaurants are in the area? What are the chances of the French onion soup message bringing one person to the restaurant? Statistics (yes, again) show that 35% of people prefer a lunch under $5 (fast food presumably) so our sixty three people become twenty one.

I think that it’s highly unlikely that one person a day is going to the restaurant after being influenced by that Facebook message, don’t you?

Here’s another quote from the internet:

Those with checks under $15 showed a profit of 3 percent. Those with checks from $15 to $24.99 boasted the highest profit margin at 3.5 percent. Finally, those with checks of $25 and over had the lowest profits, at 1.8 percent.

More assumptions – one person per day visits the restaurant because of social media. The average guest check is $15. And let’s be over-generous again because I can’t do the math – let’s say the profit on that guest check was 10%, therefore $1.50

$1.50 (profit)  x 7 (days) = $10.50
Cost for that = $210 (two hours of employee time per day)
Money thrown away = $199.50

Now these figures might well be way out of line with the real facts, of course. But for the sake of your bottom line, you need to know how much your social media is costing you and how much revenue it coming in.

Get in touch :)

 

 

Posted by Team Las Olas in : News,

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