Article reprinted from ClickZ. To view the article on the ClickZ website, click here.
Social Media Helps Some Small Businesses Endure Bad Economy
By Christopher Heine, ClickZ, Mar 1, 2010
Whether it's a 50-cent discount for knowing architecture trivia on Twitter or a Hawaiian pizza night aimed at college students on Facebook, many small businesses say that social media sites have been godsends for weathering the current recession. With a dash of creativity, these companies - including some start-ups - have leaned on Facebook and Twitter as low-cost options to communicate with customers who, in turn, have helped spread the word.
Take Coolhaus, an ice cream sandwich venture by real estate developer Freya Estreller and architect Natasha Case, the latter having become recently unemployed in her field. When they launched about 10 months ago in Los Angeles, the foodie entrepreneurs didn't rely only on their architecture-themed street vendor truck to market the brand. Instead, they took their handmade ice cream concoctions and figured out how to meld them into the local consciousness via social media.
Facebook and Twitter accounts were quickly established, and Case began experimenting with promotions. In one example, followers were provided a link to the work of well-known architectural photographer Julius Shulman. If a customer came to the truck and said his name, they got 50 cents off the "Orange Julius Shulman" ice cream sandwich (regularly priced at $3.50).
Another example of a tweet: "today's password: 'he lives in a pineapple under the sea' for our AMAZING secret flavor AND 50 cents off." The password was good for a half-dollar off a SpongeBob SquarePants-themed cool treat.
Less than a year later, the small business has almost 8,000 Twitter "followers" (longtime ice cream giant Baskin-Robbins has 10,000, by comparison) and nearly 1,300 Facebook "fans." Better yet, it plans to launch another truck in the current locale as well as one in the Hamptons on Long Island, NY, and a fourth in Austin, Texas.
And recent research by Rice University suggests that Coolhaus's social media strategy will be just as effective with multiple locations as it has been with one. The university's three-month study found that Facebook "fans" for a chain of Houston-based cafés visited 20 percent more often and spent 33 percent more money when compared to non-fans.
While stating that social media has "absolutely" driven Coolhaus's growth, Case sounded like a marketer who has only begun to post and, more particularly, tweet. "Twitter is a self-marketing machine," she said. "People take pictures of the ice cream sandwiches and the truck and post them. Friends tell their friends. It's been an exponential source of growth for us. We didn't get into Facebook until later... I think there are a lot of non-Twitterers out there, so you have to make time for Facebook. For a mobile business like ours, both social media sites are totally required."
Pizza Joint Uses Facebook to Corral College Kids
On the Facebook side of things is Golden Knights Pizza, a one-location restaurant that has seemingly navigated the tough times by positioning its Facebook page as an orders engine for selling pizza and bar food to college students. The Orlando, FL-based operation posts weekly specials at its "fan" page, which has picked up 2,200 members since the account opened in November.
Through online transactions vendor BigHoller, the establishment links the offers to a landing page where "fans" can complete orders for deals on pizza, hot wings, salads, etc. The same landing page is used for GoldenKnightsPizza.com.
Owner Chas Warner predicts that his restaurant could someday do up to 40 percent of its business through a combination of Facebook and its Web site. At times, the restaurateur has gone so far as to individually recognize "fans" for their orders with a quick "thank you" post the following day on the social site.
"The whole idea really didn't come together until we [recently] combined Facebook and the online ordering aspect," Warner said. "It is probably the biggest part of our marketing thrust at this point in time, because we are trying to rebrand/relaunch our image on the college campus for the University of Central Florida."
Social Media's Been Doggone Good to New Hampshire Small Businesses
Axel's Food & Ice Cream was named after a dog - Axel - that passed away two years ago and therefore didn't get to witness the positive effect social media had on his namesake business. The seasonal ice cream business, based in Merrimack, NH, is currently closed for the New England winter, but is gearing up to push deals via Facebook, Twitter, and AxelsFoodandIceCream.com for the second consecutive year.
In 2009, said founder Kristen Costa, the social sites were marketing boons to her drive-in/sit-down establishment. An interesting loss-leader she's run via Facebook and Twitter is the "Doggy Sundae," a free ice cream treat for dogs brought in by their owners.
"We want people to post their pictures of their dogs eating their 'Doggy Sundae,'" Costa explained. "We are definitely going to be doing more [social media] efforts this year."
To build a social media presence, Axel's has used signage around its store, encouraging patrons to become Facebook "fans" and Twitter "followers." It has accrued fewer than 200 for both accounts, but it plans on getting a fast jump on the upcoming warm-weather season by leveraging the sites.
"Social media is not like direct mail or local print advertising," Costa said. "Those marketing mediums don't make much difference with our customers. On the other hand, our Facebook fans and our Twitter followers want information from us."
Jenny Cheifetz began marketing her one-year-old Bedford, NH-based company, a confectionery brand called The Sugar Mommy, on Facebook right after launch and then through Twitter two months later. In less than a year, numbers for both accounts mirror what Costa's brand has achieved. More importantly, though, Cheifetz has seen her company grow from a local-only entity to fulfilling national orders.
"[Social media] is viral, and it's free," she said. "I'm a new business. I don't have the money to spend on a large advertising campaign."