Having made that statement, let me cite some possible ways by which it can work:

1. SEO value – Blogs, for example, are their own form of SEO. While I don’t disparage the use of traditional SEO (and the subsequent expense involved), it costs very little to produce blog content.

2. Low cost – Much of what constitutes social media is free to use. While I recognize some of the social network technology providers will charge a company a king’s ransom to use their platform, aside from the investment of time (and, yes, time is money), social media can be a cheap date. Consider Dell’s involvement with Twitter as a case in point.

3. Content, content and more content – This ties to point #1, but content marketing is valuable for SEO and other reasons and social media is a way to produce lots of it. Plus, it gives your company two things traditional marketing and advertising cannot (or not as well, at least not without deep pocketbooks), ubiquity and personality.

4. WOM – What better way to put word of mouth on steriods than with the tools of social media. It exponentiates the viral capacity of a message to spread. That’s got to be worth something.

5. Niche marketing – Dr. Ralph Wilson said that success in marketing these days is about penetrating unfilled or partially-filled niches. The tools of social media are great for that.

While true blue died in the wool marketers will seek to formulate the ROI of social media, I tend to take a more intuitive approach, for good or ill. My forumla (and philosophy) is this: You can use conversational media to turn strangers into friends and friends into customers. Seth Godin said something like that years ago. Strangers > Connections > Conversations > Friends > Customers.

It probably wouldn’t play in a board room or with the CMO, but it worked pretty well in the small town where I grew up. And the web is now a massive collection of small towns (niches). I don’t see why it can’t work here as well. But, having said that, the proof is indeed in the pudding.

Regards,

Mark