Social Media Marketing (SMM)

DEFINITION of 'Social Media Marketing (SMM)'

The use of social media websites and social networks to market a company’s products and services. Social media marketing provides companies with a way to reach new customers and engage with existing customers.

BREAKING DOWN 'Social Media Marketing (SMM)'

Social media websites allow marketers to employ a broad range of tactics and strategies to promote content. Many social networks allow users to provide detailed geographical, demographic, and personal information, which allows marketers to tailor their message to what is most likely to resonate with the user. Because Internet audiences can be better segmented than more traditional marketing channels, companies can ensure that they are focusing their resources on the audience that they want to target.

A major strategy used in social media marketing is to develop messages and content that individual users will share with their family, friends, and coworkers. This strategy relies on word of mouth, and provides several benefits. First, it increases the message’s reach to networks and users that a social media manager may not have been able to access otherwise. Second, shared content carries an implicit endorsement when sent by someone that the recipient knows and trusts.

Social media strategy involves the creation of content that is “sticky”, meaning that it will get a user’s attention and increase the possibility that he or she will conduct a desired action, such as purchase a product or share the content with others. Marketers create viral content designed to spread between users quickly.

While social media marketing can provide benefits, it also can create obstacles that companies may have otherwise not have had to deal with. For example, a viral video claiming that a company’s product causes consumers to become ill has to be addressed by the company, regardless of whether the claim is true or false. Even if a company is able to set the message straight, consumers may be less likely to purchase from the company in the future.

RELATED TERMS
  1. Social Media Optimization (SMO)

    The use of social media networks to develop and manage an organization’s ...
  2. Social Networking

    The use of internet-based social media programs to make connections ...
  3. Social Sentiment Indicator

    A measurement based on aggregated social media data that helps ...
  4. Social Capital

    An economic idea that refers to the connections between individuals ...
  5. Social Responsibility

    The idea that a company should embrace its social responsibilities ...
  6. Interactive Media

    A method of communication in which the program's outputs depend ...
Related Articles
  1. Financial Advisor

    Advisors: How to Make Social Media Work for You

    Most financial advisors today are using social media to help build their client base. Here are some tested basic guidelines on how to get started.
  2. Investing

    Social Media: High Risk, High Potential Returns

    Carefully selecting social media ETFs can provide you with the opportunity to diversify your portfolio and enjoy financial rewards due to user growth.
  3. Financial Advisor

    Advisors: How to Ask Friends for Social Media Help

    Social media can be a difficult endeavor for those who didn’t grow up around technology, but younger friends and family can help quickly fill the void.
  4. Financial Advisor

    How Advisors Are Using Social Media

    It doesn't pay to leave social media out of your marketing plan, a new study shows. Here's some insight into how advisors are using the digital networks.
  5. Financial Advisor

    How Financial Advisors Are Leveraging Social Media

    As financial advisory clients are increasingly turning to social media, wealth managers who aren't following suit risk being left behind.
  6. Financial Advisor

    Digital Marketing Tips to Grow Advisors' Business

    Advisors may want to consider these digital marketing tips when it comes to maximizing the effectiveness of their social media efforts.
  7. Financial Advisor

    Financial Advisors: Social Media Is a Gold Mine (FB, TWTR)

    Learn how social media is a gold mine for financial advisers. Maintaining a social media presence enables you to reach customers, and it provides social proof.
  8. Markets

    How Important Is Social Media For Your Company?

    Freelancers and marketing agencies are just some of the resources companies are now using to develop their social media.
  9. Financial Advisor

    How Advisors Can Carve Out a Social Media Niche

    Social media is a great way for financial advisors to build a brand and potentially generate leads if it’s properly used. Here are some tips.
  10. Financial Advisor

    Social Media ‘Don’ts’ for Financial Advisors

    Financial advisors should be aware of the many rules and regulations surrounding the use of social media in their practice. Here's a quick guide.
RELATED FAQS
  1. How do Internet companies profit if they give away their services for free?

    Learn how companies in the Internet sector make a profit when service, content and user applications are offered at no cost ... Read Answer >>
  2. Is it possible for a 79 year old married person to legally stop paying taxes on social ...

    I am 79 years old and my wife is 78 years old (working part time). I am drawing two Social Security checks, a small retirement, ... Read Answer >>
  3. What is the Social Security administration responsible for?

    Learn about the Social Security Administration's main responsibilities along with its history, structure and social safety ... Read Answer >>
  4. Why is social responsibility important to a business?

    Take social responsibility seriously, and your business could benefit from happier, more productive staff members while helping ... Read Answer >>
  5. Why is social responsibility important in marketing?

    Drive consumers toward products and services by prioritizing social responsibility in marketing to enhance the company's ... Read Answer >>
  6. What are the most common scams regarding Social Security benefits?

    Learn about some of the most common Social Security scams that occur by phone, email and direct mail, and how to recognize ... Read Answer >>
Hot Definitions
  1. Dove

    An economic policy advisor who promotes monetary policies that involve the maintenance of low interest rates, believing that ...
  2. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
  3. Front Running

    The unethical practice of a broker trading an equity based on information from the analyst department before his or her clients ...
  4. After-Hours Trading - AHT

    Trading after regular trading hours on the major exchanges. The increasing popularity of electronic communication networks ...
  5. Omnibus Account

    An account between two futures merchants (brokers). It involves the transaction of individual accounts which are combined ...
  6. Weighted Average Life - WAL

    The average number of years for which each dollar of unpaid principal on a loan or mortgage remains outstanding. Once calculated, ...
Trading Center