HOW, WHEN, AND HOW MUCH IT WILL COST TO OUTSOURCE YOUR SOCIAL MEDIA, PLUS A LIST OF THE TOP SOCIAL MEDIA MARKETING FIRMS

Many large companies worldwide are facing a conundrum when it comes to using social media to help generate new business.

On the one hand, firms of all stripes are pouring large sums of money into using paid media to do outreach to consumers on social networks such as Facebook and Twitter — and are allocating larger slices of their digital ad pies for that purpose.

In the United States alone, advertisers will spend $9.59 billion on social ads this year, according to the market research firm eMarketer. This represents a 31 percent surge from the 2014 outlays on social media, and more than double what was put into this segment in 2013.

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By 2017, U.S. advertisers will boost their social ad outlays to $14.4 billion, eMarketer projects. By that point, social ads are expected to consume nearly $1 out of every $5 in U.S. advertisers' budgets.

This year, social will account for 15.9 percent of North American ad budgets — up from 10.5 percent just two years ago. But while eMarketer has estimated that nearly 90 percent of companies with 100-plus employees did social marketing last year, many firms are also having trouble achieving their goals in that realm.

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A study that Ascend2 published in December 2014 discovered that 43 percent of respondents found a lack of in-house resources and skills as their most challenging obstacle to success from social media marketing. Another 42 percent complained about an inability to measure return on investment, and 39 percent cited a lack of effective strategy.

These results suggest that for many companies it may make sense to outsource the job of social outreach to prospective customers (something that the Ascend2 study found 53 percent of respondents were doing, in whole or in part).

However, as companies worldwide learned during the great outsourcing boom of the previous two decades, farming out important jobs carries risk.

As Hootsuite has pointed out, having someone else handle your social marketing can result in everything from an added layer of bureaucracy for customers to navigate to slower response times to consumer inquiries.

In social media outsourcing, as in every area of business, it's important to pick partners wisely — and to follow sensible practices in managing your relationships with those vendors.  

Five Keys to Social Media Outsourcing Success

Success in outsourcing social marketing boils down to five considerations:

1. Setting realistic goals: Before talking to prospective vendors, executives need to establish what they want to achieve from a social campaign and how outreach in this realm can help achieve them it. Up-front research is key to know what's doable.
2. Doing due diligence: A relationship with a key vendor can bear certain similarities to marriage. As any divorce lawyer can attest, bad marriages can wreak havoc on the lives of everyone involved. It's thus vital to do as much up-front checking on prospective vendors as possible.  
3. Being reasonable: As CIO.com has pointed out, hardball business tactics (e.g., beating vendors down on price or paying bills slowly) can lead to hard feelings — and problems down the road. Maintaining good relationships with vendors can lead to better results for both parties. 
4. Using a carrot and stick: In social media, as in any area of outsourcing, it makes sense to pay for performance. This means structuring the vendor's compensation so it has an incentive both to work only in the client's best interests and to help achieve business goals.  
5. Getting everything in writing — including an escape hatch: If client and vendors both leave extensive paper trails on their key interactions, it provides both parties with strong motivations to live up to their sides of the bargain, along with a quick and fair way to resolve disagreements. Every vendor agreement should provide the customer with some type of "kill switch" to get out of the deal if things aren't working out.

Ultimately, a relationship between a company and its social media vendor is just that — a relationship. And like any interaction between people, the client will only get out of the association what it puts in.

The more a vendor can learn about a client's business and its goals, the better the vendor can serve.

And isn't that what outsourcing is about in the first place?

COMMENTARY:    As has been pointed out in the above article, the biggest obstacle small business owners face in managing social media inhouse is a lack personnel with sufficient expertise in social media marketing and management systems.

Simply having a social media presence on social networks like Facebook, Twitter or Pinterest, does not provide sufficient experience for small business owners to manage their social media inhouse. Managing your social media means a lot more than just posting updates in your newsfeed, generating Likes and retweets for your content, or sending messages with your fans and followers.  

At some point, small business owners are faced with the decision to do their social media inhouse or outsource their social media.  So, let's look at a few cost estimates.

Social Media Management Costs

According to Mack Collier, a social media marketing thought leader and blogger, here's what outsourcing social media PR costs for Twitter and Facebook platforms:

• Twitter - Launching a new Twitter account, complete with setup and outsourcing content creation/consumer interaction (all 140 characters at a time), costs an average of $2,000-$4,000 per month – and that's just for Twitter. With that said, the total price range was $1,000-$7,500 per month.   If you already have an existing Twitter account, but need some help to take it to the next level, restructuring an existing Twitter account with "limited coaching" to achieve client goals is still going to cost you between $1,000-$2,500 per month, with some charging as much as $4,000 per month…just for Twitter! That's right, if you want Facebook, you're paying extra.
• Facebook - If you thought the costs of marketing with Twitter were high, you might want to grab your fainting chair — Facebook marketing rates will give you a case of the vapors. To set up a new Facebook account and provide limited ongoing training to business partners, online PR agencies charge an average of $2,500-$5,000 per month, with some going as high as $9,000. Of course, this also includes status updates and interacting with customers. 

If you're shelling out a minimum of $4,500 per month for Facebook and Twitter management, you're not getting any strategy behind the efforts.  Social media strategy is an additional cost. 

Social Media Strategy Costs

According to Mack Collier, creating a comprehensive strategy for social media marketing and outsourcing all work for all channels (with a minimum of two social networks) costs anywhere from $3,000-$20,000 per month, with the industry average settling between $4,000-$7,000 per month. If you want the social media agency to start the accounts from scratch and consult on a 4- to 12-month contract, you'll pay between $3,000-$15,000 per month. What do they mean by channels, minimum of two? That's just a fancy way of saying that the cost includes both Facebook and Twitter…I'm betting there's probably an upcharge if your company wants Google+, too.

Other Costs To Consider

• Customer Personas - If you're doing market research to figure out your customer/client's persona(s) and preferences, it's possible to legitimatize a $20,000 spend to gather the background info necessary to excecute a killer social media campaign. But otherwise, you can probably get much of the same for less money.  I also recommend that you read my previous blog posts on developing customer personas dated June 20, 2015, July 20, 2015, September 2, 2014, and March 6, 2014.  I have actually helped clients develop customer personas, and it is a grueling process, which is why it costs so much to do. Truth be told, many clients think they know their customers, but they really don't.  Knowing customer basics such as gender, age, what they buy, and how often they buy, barely scratches the surface.  To do it right, you need more indepth ways of describing and segmenting your customers, hence customer personas.
• Social Media Audit -  What if you just want an audit of your current social media strategy, with a few pointers on how to improve?  This is going to cost you anywhere from $2,000-$10,000. The lower end of this spectrum seems reasonable, especially if you add in the cost of social media training and competitive analysis. The only way to justify a $10k spend is if the social media consultant actually flies out to your office and does an in-depth, in-person training over the course of several days. 

Before jumping into the fray and making the decision to go inhouse or outsource or your social media, it might be very helpful to know what small business owners are spending on social media. VerticalResponse conducted a survey of small businesses, and the created this wonderful infographic that shows what SMB's are actually spending.

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If you are a small business owner, you are probably experiencing advanced stages of sticker shock, and probably ready to drop the whole idea of outsourcing social media.  However, keep in mind that 62% of small business owners outsource some or all of their social media functions.  Having said this, if you are serious about outsourcing, and willing to make the necessary investment, the next question is:  Who do I contact to outsource my social media management and strategy.  Well, I just happen to have that information for you, thanks to the good folks at Clutch Firms That Deliver. Clutch has done all the work of reviewing and rating the top social media marketing firms.  I am not recommending any particular firm.  They are all good.  The best of the best.

Make sure that you do your homework when evaluating firms to outsource your social media.  You should be asking the following questions:

1. How long have you been in business?
2. Who are your clients and can you provide references?
3. What sets you apart from your competition?
4. What social media services to you provide?
5. Do you offer month-to-month or fixed term contracts and what is your minimum term?
6. Are there any penalties for early termination of contracts?
7. Do you offer pricing plans for each social media service and how much does each cost per month?
8. Do you offer package pricing plans, what is included and how much does each cost per month?
9. How long will it take to accomplish our goals and objectives?
10. What exactly will I get for my money?  
11. How many people will be assigned to my account and what services do they provide?
12. How often can we contact you about problems and issues, needs and requests?
13. How much interaction do you require from the client?
14. Do you offer clients a dashboard where we can view our social media efforts in real-time?
15. Can the client prepare their own newsfeed content and tweets?   

Courtesy of an article dated September 16, 2015 appearing in eMarketing and Commerce , the Content Factory's article titled, "How Much Does Social Media Marketing Cost," and Clutch's "Top Social Media Marketing Companies - 2015 Reviews"

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