Social Media Could Lead to More Business Capital
Most business owners know that great reviews from customers online often lead to more business. They also know that a good online presence – conversing with customers through Facebook, Twitter, Instagram and other platforms – builds rapport. But some may not know that these things can help organizations secure a loan from a small business lender.
Nontraditional lenders like National Funding are increasingly vetting applicants via their online presence to see if a business is likely to pay back a loan. If customers write online reviews complaining about bad service and bad communication or if there’s virtually no trace of a business online, lenders may be led to believe that a loan won’t be repaid. Similarly, if a company gets rave reviews about its service or products, it likely will experience success, making it easier to pay back loans.
“I think if you were to look at companies that spend time investing in communicating with customers and engaging them, then that means you’re detailed in your financials or other items on your balance sheet,” John Frank Robinson, a small business owner, said in an interview with the Orange County Register.
The Register report said monitoring a company’s online and social media presence is especially helpful for nontraditional lenders that cater to small and new businesses that need quick financing but may not have an extensive history to be judged on.
One online credit provider found that small businesses that have a strong social media relationship with customers have a 20 percent lower delinquency rate than those that aren’t active on such outlets, the Register reported.
Besides possibly helping a small business secure a loan, social media remains a huge factor in a company building positive relationships with new and existing customers. There are a few ways businesses can use social media outlets to stay popular with its followers.
For one, by providing helpful content to customers, small businesses can act as a voice of authority. Customers will begin looking to the company for tips, valuable news and links that may be of interest to them.
Another way businesses can boost their social media popularity is to promote other businesses. While it may seem counterproductive to name drop potential competitors, if they have a good idea or are known for a great product, giving them credit will boost credibility.
Nichole Kelly, CEO of a social media company and president of a digital marketing agency, told The Huffington Post that small businesses should follow the 80/20 rule on social media. Under this guideline, a business should only post about its own services and products 20 percent of the time, leaving the other 80 percent to align with customers’ interests, such as news about their respective industry.
Finally, a small business should follow a pattern of what they post and when. For instance, a restaurant may want to post its daily special in the mid-morning when many of its customers are getting settled in at work and checking social media for their night’s plans.
In short, small business owners should keep in mind that social media isn’t as easy as it may seem, because once you’ve turned off a customer, it’s difficult to win them back, so setting aside time to make sure all efforts are top notch is a must.
“Where small business owners often make mistakes is that they’re constantly looking for an easy button,” Jason Falls, a founder of a social media company and vice president of digital strategy for CafePress.com, told the Post. “Social media is not a channel that you can walk away from for a while and not lose a lot of ground.”