Social networks can be a useful tool for business but a survey of 500 small-businesses by Citibank/GfK Roper finds that small-business owners are not finding social networks useful in lead generation. They are getting better results in this from search engine marketing. Maria Veltre, EVP of Citi’s Small Business Segment says, “Our survey suggests that small business owners are still feeling their way into social media, particularly when it comes to using these tools to grow their businesses.”

I think this is a question of finding the right tool for the right job. Social networks can be useful tools for businesses but they are most easily used to add depth and quality to relationships or to provide an alternative contact channel. Social network relationships are based on connections with a person or company identity and search engine marketing is tied to keywords and is topic specific.

The decision to follow on a social network is generally made on the basis of a broad view of profile content, even if the profile is initially found through a search, but search engine marketing is about having a great answer to a specific question. The decision to click through or not is taken based on a discrete piece of information.

Small businesses in particular are looking to their websites as an increasingly important means of communicating with customers and potential customers. It is estimated that US SMEs are poised to triple their website spend. It is very important not to only focus on lead generation in this endeavour. New customer relationships are very important but neglecting existing ones is pure folly. After all they have already been invested in.

This is where the value of social networks comes into play. It is a way of keeping in touch with customers in a way that suits them. Many of them are already present in social networks and informing them of site updates and engaging with them where they want to be is a useful way of maintaining mindshare. Social networks may not be the best method of lead generation but it can be a vital part of making sure that your advertising spend is bringing you new customers rather than renewing your relationship with old ones.