NZ's burgeoning social media industry
Social media is exploding and smart young Waikato companies are cashing in on the burgeoning industry of building marketing strategies for social media platforms.
With the world moving online and New Zealanders spending an average of two hours daily in cyberspace, marketing to the two million-plus Kiwis on Facebook is becoming a better spend of advertising dollars.
Companies are ditching do-it-yourself attitudes, seeing social media marketing as a necessity, not a negotiation, and they are looking to professional help to get it right.
This has led to an explosion of online marketing and advertising businesses in Waikato, and a few established companies have diversified their offerings.
Social Media New Zealand, a company that monitors trends, says this is a reflection of national trends as commerce looks to digital marketing solutions for an increasingly digital audience.
With more than half the country on Facebook and populations steadily growing on platforms like Twitter, LinkedIn, Tumblr and Pinterest, a critical mass is forming online. So the audience is there, now the message just needs to be appropriately packaged.
Enter the professionals.
Daniel Yarranton, Glen Tylee and Adam Smith are the 20-somethings behind Hamilton's boutique online and social media marketing agency Eight80.
The three digital natives are archetypical social media gurus: young, educated and teched out, the type of guys you can imagine staffing Facebook's headquarters. Eight80, named after the flat the business was dreamed up in and initially ran out of, celebrated its first birthday recently – 12 months teaching companies how to use social media to grow and engage client bases.
They say with Waikato companies catching on that social media marketing is important, their youth – which in other industries could mean inexperience – is an edge.
"It works in our favour. We are legitimate because we have grown up with it and a lot of people have no clue about it," Yarranton says.
"They can see we have a good knowledge of what we're doing and we show results."
He cites United Sweets as their success story, a Hamilton startup selling imported American candy online and out of a retail premises in Frankton.
Run by the Puklowski family, United Sweets started with a website in December and a Facebook page, which now boasts more than 18,700 followers and is generating 1000 new likes and potential customers a week. The startup is forecasting revenue of $1 million in its first year.
As for Eight80, this year it's on track to increase revenue tenfold on last year (the trio won't disclose figures). It has moved out of the flat into Te Rapa and its very own Facebook-like office – empty except for some plain wooden desks topped by the latest computer setups.
"Within a year we have gone from working out of a lounge, with an investment of $500, to a profitable and sustainable business," says Tyree.
When Eight80 burst on to the scene only two other companies nationwide offered the same services they did.
Now, there are more than a dozen Waikato companies who are billing themselves as social media marketing practitioners.
Yarranton says what sets Eight80 apart is a complete approach to online marketing with three main targets – strategy, implementation and monitoring of social media for businesses.
"Strategy is not just for social media platforms, it's about the whole online experience. It's the holistic view of marketing online and also integrating marketing online into offline campaigns as well."
He says it's all about stretching the marketing dollar and equalising opportunities for small businesses so they can compete with big business by successfully selling themselves online. The rapidly evolving technology used in the industry means Eight80 is constantly updating itself. The three devote a big part of their working week to researching new platforms, new changes to established platforms and better ways to engage online audiences.
"It's hard ... platforms are changing the coding without giving you any notice at all, so that's challenging, but as long as we allocate time to research, we keep on top of things," Yarranton says.
Hamilton-based web developer Matt Gifford works on the implementation of social media strategies for global brands and is also constantly having to adapt to technology changes.
Gifford creates apps for social media platforms, helping firms interact with their client base. A lot of his work has him updating old apps to work with the changing technology across platforms.
"Facebook applications that you wrote three years ago don't even run now. The platform has changed so much that they don't even work," he says.
"It's not very permanent. You work on something now and in 24 months it might not go at all.
"A while ago I worked on an app for ... Lux skin care. That app has completely stopped working, it has been redeveloped again and I got an email this morning that something has changed again. Things are always changing."
But a benefit of working in social media in New Zealand is that we lag behind the rest of the world in uptake of social media.
Trends can be mapped before they reach our shores and companies can pre-empt what platforms and what type of media – whether it be photos, video or audio – will attract the biggest audiences.
Based on trends and work from the United States and Britain, Gifford predicts Google Plus, mobile platforms for Facebook and Twitter, and video platforms will come through strongly in the next few years.
Total Media Magic, a branch of Waikato-based publishing company Maruki Books, says companies should choose one platform that fits their clients and make it successful.
Magic's consultants, Maria Carlton and Quentin Weber, say companies can be confused about whether Facebook, Twitter or Pinterest would fit their business best and spread their resources too thin by creating a presence on too many sites.
This means they don't capture audience because they don't provide enough content on the right platform where the majority of their audience are, they say.
"You've got to look at how does my buyer look at my brand – where are my buyers mostly found," Weber says.
"You need to choose the right platform for your company; you need to be informative and interactive rather than absent. You wouldn't spend money on a Yellow Pages listing if you get buried four or five pages in – it's the same thing with which social media platform."
But then, as Weber says, for smart young social media educators, Yellow Pages is "just a useful resource for prospecting [new clients] now".