More and more today, small companies are turning to social media platforms to market their businesses. Often they’re not sure why or how to do it – but the allure of what they read in the press about the local coffee shop or drycleaner whose amazing Twitter campaign increased their business seven-fold has proved too hard to resist. And yes, while it is possible for SMBs to use social media channels to increase exposure and revenue, it comes with a significant tax in human capital costs and is therefore not be undertaken lightly.

Even in a minimal implementation, to achieve reasonable topline results, a real live (and smart, locally aware, English speaking, etc.) thinking human being needs to physically post content, answer questions and target audiences – and work on each individual process on a daily basis. At SoundView, as we’ve worked on multiple social media accounts for various SMB clients, we’ve come to realize as many others have that it’s a “grind it out” process – but nevertheless we still conclude that net net it can indeed generate significant returns if done methodically and with a commitment to a long term vision of the place social media activities play in the overall marketing mix of the company.

As an example, one of our staffers recently undertook a project to utilize social media (versus SEM or other online/offline tactics) to increase diner traffic at a local Asian Fusion Restaurant. Despite traditional offline SMB tactics (doorhangers, happy hour promotions, etc.), the restaurant wasn’t turning enough tables to get anywhere near maximizing its capacity. It had dabbled in social media - when we first took over their social media accounts they had only a small presence on Facebook and Twitter with very little following, around 50 or so on each platform.

To gain followers we targeted people living within a 10-mile driving radius of the restaurant. We specifically searched within this area for people discussing food on related sites – especially those craving the food that the restaurant provided. This “audience mining” process as well as reaching out to these individuals had to be done manually on a daily basis. After 3 months of “physically” following around 100 people 4-5 days a week, we achieved a dramatic increase in overall followers – 600+ or so on each platform. And the restaurant in turn saw a dramatic increase in diners per night that continues to this day - they are almost at capacity on most of their key nights. But it is hard to say whether the ROI on this was anything more than break even – except if you assume a reasonable LTV on these customers (not easy in the restaurant biz) and some amount of incremental word of mouth that brings in additional “freely acquired” diners.

The other task we needed to undertake while simply corresponding and “suggesting” to individuals in our target that they try the restaurant was the creation of fresh and interesting weekly content and promotions. We incented prospects to “like” the restaurant with on Facebook to earn a 15% discount off their meal. Was this “buying” of likes worth the hit the restaurant took on margin? Again, hard to say – but the number of diners did increase over time who anecdotally indicated they were Facebook friends of our incented individuals.

We also used social media as a customer service tool – we had a dedicated resource standing buy that could quickly respond to comments by customers and prospects alike that raised questions/concerns/feedback online. The truth is – if you open the door to online inquiries and the social media model – you need to answer the person who’s likely to be standing there. Don’t open the channel and then not provide a resource to respond. Social media users communicate through the platforms every day, which requires a fast response - keeping up with interaction is vital for any business. But it’s also costly in terms of man hours – and again, total ROI is VERY hard to track.

In conclusion, we’d suggest that in order to find signal in social media – that is, understand whether there is a bare likelihood of social media efforts returning positively for your SMB, we suggest you dip your toe in the water starting with a Facebook page just to get a feel of what it takes to post day-to-day content and build a network of followers for at least 1 hour per day – start small and target 50 people within a few weeks.If you can’t get that – stop. If you find that you’re getting a reasonable viral/network effect, then you can take a deeper plunge. It might be a gamechanger for your business, but make no mistake – the labor costs are intensive and often difficult to track in terms of evaluating total ROI of the effort.