Social network ad spend has been rising steadily over the last few years with marketers extending their online pay per click and banner advertising beyond the seach engines to include the social networks as well. It is estimated that during 2011 marketers in the US alone will spend £3.08 billion on social network advertising. eMarketer predicts that US ad spend will be up 55% on 2010 when marketers spent $1.99 billion, and that worldwide social network spend will be up 71.6% in 2011 to $5.97billion.



Facebook, by far the largest social network, is clearly having the greatest impact on this growth through a year-on-year increase in Facebook advertising. Facebook therefore contributes up to 65% of the 2011 prediciton. eMarketer predicts that advertising spend on facebook will hit $2.19 billion in the US alone in 2011 and over $4 billion worldwide. That's more than double the total spent in 2010!


So as we move further into 2011 social networks are poised to absorb an even greater percentage of all online spending making them difficult to ignore for any business serious about their online marketing. We will be watching eagerly to see what developments Facebook has planned for the forthcoming year.

In a report published today it was revealed that the internet in the UK alone is worth £100 billion to the economy, representing more than a 7% share of total national income.

The study, carried out by the Boston Consulting Group on behalf of Google, the internet’s most successful company, places a value on the UK internet market for the first time.

If it were an industry in its own right the internet would be more than twice the value of the UK hotel and restaurant market and nearly as big as the financial sector, which accounts for 9% of Gross Domestic Products in 2009.

However, the research did find that there is a digital divide in the UK, with certain parts of the country – namely Scotland and Northern Ireland – lagging far behind London and the south-east.

In an interesting twist in the report, it turns out that British consumers are more willing to spend money online than can be typically seen elsewhere. E-commerce drives a large section of the internet’s expansion; as a proportion of retail sales, online transactions in the UK are high.

To emphasise this point, the UK has the largest e-commerce market in the world when measured by the amount spent per capita. The popularity of buying goods and services has also fueled a boom in the amount companies are prepared to pay for online marketing as heavy spending can help attract users to their sites.

The online advertising market in Britain is worth £3.5 billion and is the biggest anywhere outside the US.

It is forecasted that the internet economy is to continue to boom with 10% year on year growth projected for the next 5 years. If this trend comes to fruition then the internet economy will contribute up to 13% of GDP by the year 2015. For an idea of scale the current internet economy is already larger than the utility and transport industries put together.          

The report also highlights the success of small firms using the internet to increase global sales. The UK now exports goods and services which are worth £2.80 for every £1 it imports. Google’s annual turnover was £23.6bn last year which encompasses very nearly a quarter of the £100 billion contribution the entire internet made to the UK economy in 2009.

Marketing is probably the most important activity that a business can perform. Good marketing will bring increased loyalty from existing customers, as well as attracting and retaining new ones. For your business to grow, it has to communicate with its market and build relationships with customers. Unfortunately though, most people consider marketing to be an expensive exercise, and are reluctant to spend money on trying out new marketing activities. This doesn’t have to be the case. Here are some tips for new and small businesses that have a small marketing budget.

- Have you tried direct marketing? Posting letters, making telephone calls and sending emails can be some of the most cost effective ways of getting your message out there. For this to work though there are rules that have to be followed: make sure you are marketing to your key target market; make sure the data is accurate; make sure you have a good offer that is relevant to that market; and make sure the marketing material discusses the benefits of using your service or purchasing your product. You'll also need to include a strong call to action. Using direct marketing to keep in touch with existing clients (company newsletters and e-bulletins) is also a great way of increasing sales activity.
 
- Make the most of the Internet. The internet can connect your business to most people on the planet, so you should be able to find some new customers through it. Use it as a medium for making yourself known as well as a way to study your customers and your competitors. Write new content, news articles and/or blog posts and place them on your website. These are the type of thing that search engines love and will help improve your website ranking.
 
- Encourage word-of-mouth marketing. You could provide your current customers with incentives, offers and special deals if they help to promote your business to their friends and colleagues. A word-of-mouth referral strategy is not only cheap to implement, but it often generates the best type of business, as most companies find referred enquiries are the easiest to convert into new customers.

- Show off some testimonials. People are cynical and used to businesses providing a poor service. Build confidence in the marketplace by broadcasting what your satisfied customers have said about your business. Stick these in your brochures, on your sales letters, in your newsletters and on your website for everyone to see. The bigger and more well-known the client, the better. Just make sure that they are happy with you quoting them.

- Get out there and network. Making friends and acquaintances in the business world can be very beneficial. A lot of businesses are just waiting to be a supplier or customer for your business. Sign up to breakfast meetings and get to know other businesspeople in your area, you could build strong strategic alliances that are valuable for years to come.

- Try Public Relations. Taken on a new members of staff? Won an award? Launching a new product? Write a story about it and send it in to newspapers and magazines. Readers often consider editorial as more important than adverts, and are more likely to trust what is being said. If however you do not know how to write a story well, or do not have the confidence to contact journalists, then it will be worth investing in the services of a PR firm.

A company that I work closely with is Computer Recruiter, a recruitment agency that people use when looking for IT jobs in Cardiff, Wales. A press release of theirs was recently published in a national newspaper and included a discussion on their new website and the URL (the address of the site). When I checked their Google Analytics the next day to see the effect this release had on their traffic, there was roughly a 50% increase. This was to be expected, but there was also one surprising fact that I did not expect to see.

When looking at the source of this extra traffic, I assumed that a large part of it would be direct traffic, i.e. people who typed the URL that they had just read into the web-browser address bar. There was actually zero direct traffic that day. All of the new visitors chose instead to visit Google and searched for keywords like “computer recruiter”, “computer recruiter Cardiff” and “computer recruiter ltd”. Even when presented with a URL, not one person chose to type it into their address bar and go straight to the site.

What does this mean to your business? It highlights that if for no other keywords then your business needs to rank well on the ones that make up its name. This sounds obvious but many companies do not, especially those with names made up of generic, descriptive words. For example, a car retailer with a name like “Prestige cars” will be competing with thousands of other sites for the keyword “prestige cars”.

For businesses of this type, the consequence of not appearing for their name could be severe. It is likely that your competitors will rank for these search terms, especially if they practice search engine optimisation (SEO) techniques. Imagine that you had paid for the writing and distribution of a press release or the inclusion of a magazine advert and rather than bring new visitors to your site all your marketing campaigns did was lead customers to your direct competitors. Your market share could start shrinking without you even knowing it.

So, how do you stop this from happening? A few search engine optimisation basics include having your business name as, or at least within, your URL. You should also include your name on your homepage and “about us” page as 5-10% of the copy. When generating links to your site, you should make most of the anchor text rich with the keywords that you want to compete for, but every once in a while put your business name in there as well.  You could also set up some Pay Per Click adverts that bid on your company name and similar keywords.

In future blog posts I’ll discuss online marketing and search engine optimisation techniques further to help you start appearing before your competitors on Google.