I can pick up the phone and make a cold call and talk to someone who I might be able to get business from; or I can create a Twitter account and follow people who I might be able to get business out of.
The next best thing that a person can engage in is referred to as the opportunity cost of doing the best thing (more desirable) and ignoring the next best thing to be done.
So which is the best thing? Which is more effective?
Opportunity cost is a key concept in economics because it implies the choice between desirable, yet mutually exclusive results. Which is desirable? Making a cold call or reaching out via Twitter to someone you might get business from? Which is a more effective use of your time? Are the results mutually exclusive? Maybe. But not immediate.
The notion of opportunity cost plays a crucial part in ensuring that scarce resources are used efficiently. If I have 2 phones and 2 computers with 2 Twitter accounts-which will be more efficient in the long run? Or the short run for that matter.
You see, opportunity costs are not restricted to monetary or financial costs: it can be the real cost of lost output or lost time. Twitter can be quite inefficient when it comes to working it into the prospecting flow of your work day and treating it like you would your outbound marketing. You have to know how to use it correctly. It compliments, but it doesn’t replace.
Try selling that to an SMB
Direct Marketing Observations 
Marc- great post. I’ve been thinking about this awhile. I really can’t go to our sales people and say “Try using Twitter for leads/business” when they’re doing a great job at getting business via phone and in-person meetings. And maybe I should be calling people more instead of blogging or being on Twitter. But it’s really hard to say. People definitely shouldn’t stop doing things that are working for them to use Twitter. That doesn’t mean you shouldn’t experiment though.
@Jason, I’m surprised more people don’t look at it this way, though as I said, use it as a complimentary piece.
I’m not sure I completely agree. I’ve cc’ed for years and enjoy it, but I have found that networking for referrals always trumps cold calling.
Twitter not only facilitates the networking I need to do (mixed with LinkedIn and RSS searches), but allows me to pay attention to brands I’m focusing on selling to (both for weaknesses and strentghts) as well as gives me a place to look for people hurting and in need of services.
Twitter may not replace the immediate math game of cold calling for everyone – but it has for me and my business. Networking, for me, is always better than cold calling.
I can focus more on people, less on random odds and be free’d up to spend time cultivating relationships.
As a side note: even though I did well at cold calling and enjoyed it for the most part, it was still tedious and draining. I’ve never felt that way about networking and using social media as an outlet has been a huge win.
Are you suggesting I am using Twitter incorrectly, Marc? Instead of following people to create and maintain networking ties, I should follow people for potential sales?
I realize you’re speaking more to businesses, e.g. JetBlue Airways, than individuals… but shouldn’t the same logic hold true for maximum value?
@ari, I don’t think I mentioned you by name Ari, but what I am saying is that Twitter is not necessarily a sales substitute and should augment your ones other efforts. I’m really surprised at how little people talk about how much of a time suck twitter can be. Make wise choices is what I’m saying.
@John Im curious, how long have you been using “the new tools” and what have been the results?
Well written Marc. I agree.
Sometimes we lose sight of the possibilities because we get so hung up on the holy grail of conversation.
In a business sense, time is money. If I can use social media to listen more and target my calls more effectively, I have saved myself my most valuable asset.
This is not just an approach online I take online… this is a great approach to evaluating the hundreds of in person networking events that go on locally. When I pick a group to join, I naturally want to pick the most target rich environments for people that I want to meet.
Twitter as well as other social networks such as facebook, plaxo and even linkedin CAN be huge time sucks.
As a social media consultant, I work very hard to advise my clients to manage their time investment in these venues and never to expect them to be the “silver bullet” solution.
Success in the Social Media / networks venues rely on a cohesive implementation strategy that AUGMENTS proven existing marketing strategies.
Just my 2 cents.
@allan, that’s it! Augments is the rule and replaces is not.
Cyndee well put. I wonder if a company that we called on has the same issue…They have lost sight of the possibilities and are focusing on the barriers preventing them from engaging.
Twitter as a time suck…love that you’re pointing out how this is possible when it is used incorrectly.
Have I ever used it “Incorrectly” of course I have…composing Tweets, and so on gets kind of addicting. For me one of the things about it that has become so compelling is, who will find me compelling and entertaining, and informative enough to follow, RT, and so on.
It’s kind of like a huge trolling effort…never know what will get caught in that net when you reel it in…
At my best I use Twitter as a magnet of sorts. I set myself up as an Industry Authority. I do this by posting information links to sites other than mine. Sites that have very clear, useful and mostly free information about collectibles, antiques and vintage items; mostly about how to research values. Also I promote my followers efforts.
I do this about 75% of the time.
I only Tweet about my companies efforts, or what I am trying to sell about 25% of the time.
The results for me are trending upward.
Traffic to my site is way up.
In short, I use Twitter to reach people I want to know, and I use the phone to engage with people I already know…
Martin
Martin, love seeing how you are balancing and leveraging your efforts but not putting all of your eggs in one basket.