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Just last month, the U.S. State Department announced that it was shutting down www.America.gov, the website launched to provide cultural and policy content to the world. Instead, the State Department will focus on using social media to get out its message. The aim is to communicate in a more interactive way with today’s networked audiences around the world—like those blogging Egypt’s revolution from Tahrir Square or documenting Syrian unrest on YouTube.

Shutting down your website to communicate solely through social media channels might seem like a crazy idea for any large organization. But then again, there is some logic to it. The Wall Street Journal reported that Starbucks receives over ten times as much traffic to its Facebook page (19.4 million unique visitors each month) as to its corporate website (1.8 million). For Coca-Cola, the divergence is even starker: 22.5 million visitors on Facebook vs. just 270,000 to its website—over 80 times as much traffic.

A decade ago, the corporate website had become the new “must-have” communication tool. But now, as web users spend increasing amounts of time on social media, traffic to static corporate websites appears to be on the decline.

Facebook vs Website Traffic for 2 Brands

But before you rush out to pull the plug on your own web site, it’s worth considering the benefits of each approach.

Benefits of Social Media

1. Inherently interactive. That’s where the term “social” comes from. Unlike a static HTML website, designed to read and click, social media like Facebook, YouTube, and Twitter are designed around sharing, responding, and interacting.
2. Where people are spending time. With over 500 million active users on Facebook, most Web audiences are spending more time there than browsing company sites. Just be sure that’s true for your own demographic (e.g. Facebook is a nonstarter in Japan) and your own industry (most users still do not use Facebook for learning about b2b topics).
3. Easy to acquire. Clicking a “like” button on Facebook or “follow” button on Twitter is a lot easier than filling in the sign up form on a web page. So it’s no surprise that many companies find it easier to build a large following on social media platforms.
4. Virality. When your audience interacts with you on social media platforms, it is instantly visible to their own friends and contacts. This digital “word-of-mouth” can be one of the most powerful tools for reaching new audiences.

Benefits of Your Own Website

1. Control the design. Have you ever tried designing a page on Facebook, Twitter, or YouTube? The experience is like trying to swim with one hand tied behind your back. Having your own website allows you complete control, which may be essential if you have a lot of content or options that you need to organize for different audiences.
2. Own the data. Social media platforms are owned by the companies that run them, and, as such, they are the only ones holding all the data on your customers and your interactions with them. On your own website, you own all the data.
3. Targeting and personalization. Owning data and controlling design allow for much more targeted interaction with your customers than is possible on social media platforms. If you know which emails a customer in your database is clicking on, you can ensure her follow up emails, Web landing pages, and ecommerce experiences are much more suited to her particular interests.
4. Reach all your audience. Unlike Facebook, Twitter, or other services which might reach large segments of your customers, your own website is available to 100% of them. (That is, as long as your website has been optimized to work on a mobile phone.)

So, unless you are so small (e.g. a one-person enterprise) that you lack the resources to maintain both a Facebook page and a website, you almost certainly need both. (Even the State Department still kept its main website after shutting down America.gov.)

Fresh Approach Needed

But as you hold on to your familiar company website that’s grown a little musty over the last decade, be sure to give it a fresh look. Are you using the unique design capabilities of a stand-alone site? Are you capturing and leveraging data? Are you interacting and building a database with your most loyal customers who care enough to do more than press a “like” button for you? If not, your website needs a revamp to be worth keeping it alive for next year.

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David Rogers examines the five core strategies of successful networked businesses in his newest book, “The Network Is Your Customer: Five Strategies to Thrive in a Digital Age.” He teaches Digital Marketing Strategy at Columbia Business School, where he is Executive Director of the Center on Global Brand Leadership. Rogers has advised and developed marketing and digital strategies for numerous companies such as SAP, Eli Lilly, and Visa. Find him on Twitter at http://twitter.com/david_rogers.

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Now our own thoughts on this are mixed. Not every client needs a website. Some clients need a boost in their Social Media strategy, some need a website and some need both. We’re here and happy to give you a free analysis on your online presence. In any case, we’re about to publish this article and it syndicates to Social Media. Why the U.S. State Department isn’t using this exact same strategy to balance out their numbers and create a stronger presence is a bit baffling. Please feel free to share your thoughts!

Last week I had the opportunity to talk to a leading industry analyst about a number of potential small web site investments that marketers and publishers could make to yield the biggest possible pay-off. The premise being, of course, that in economic hard times site owners needed to stretch their budgets to do more than ever – and generate real returns.

While we are hardly entering the hardscrabble environment of a previous Internet-era, it’s always good to revisit first principals when it comes to website design and development. Namely, that everything can be continuously measured (and optimized) and the digital medium is accountable: we can truly measure its impact to the bottom line. No guessing about what audience saw what ads here!

Our conversation ranged from the impact of search to social application widgets, like those from Rock You, to advanced analytics. So, for struggling site owners, here are my three quick web hits for hard economic times:

1. Acquisition: Reaching new customers or audiences is key. To do so as efficiently as possible, investments in Search Engine Optimization and Paid Search advertising efforts are key. Consumers aren’t searching any less in tough times (and given the fact that there’s no cost, they may be doing even more searching), so optimizing one’s pages for natural search engine optimization is critical. Think of every page as a homepage, an inventory that can be accessed in any conceivable manner regardless of typical ecommerce or content flows. Ditto for investments in paid search and paid inclusion. Now’s the time to really revisit these strategies.

2. Conversion: Optimize conversion flows endlessly. Digital properties are all about “flows” or the paths that consumers take through a site or application on their way to completing a task. As I’ve written about before in Our Brave New Beta Future: Site-side analytic tools like SiteCatalyst, Hitbox and WebSideStory are great for serving up general reports on success ratios but yield few clues as to why users exit a flow. That’s because users exit on a page, not going from page-to-page. To ensure that you are designing for maximum conversion, Avenue A – Razorfish employs a proprietary tool called Advanced Optimization that allows us to track user behavior at the page level.

This allows us to see exactly where users click on a page, the amount of time spent filling out form fields, how far users scroll, how much time they spend watching a video, interacting with a flash module and more. Using a solution like this typically yields fantastic returns. I’ve personally seen clients get 25% lifts to their conversion rates and “based on sales volumes” have seen yearly revenue increases of $2 million or more based on slight, strategic, design tweaks. Also, don’t forget about implementing multivariate testing as well (think of it as A/B testing on steroids) to determine the best and most effective mix of creative, copy and page design elements.

3. Retention: If you haven’t experimented with social media or other participatory digital concepts now is definitely the time. It’s just as important to maintain an ongoing relationship with existing consumers as it is to acquire new ones. Social media, if nothing else, is geared towards fans of your brand or site. Whether it’s chunking up your video assets for distribution on YouTube or launching a new campaign or page on Facebook, it’s definitely time to consider small initiatives here. A couple personal favorites are working with emerging web application providers like RockYou (which has incredible reach) or creating custom social media experiences, such as Red Bull’s Roshambo on Facebook. These speak to brand loyalists in meaningful was (most of the time) and may even net you a convert or two.

Of course none of this can be done too cheap, tiny budgets still won’t get you a whole lot, but these tactics are the perfect remedy for hard economic times. And, come to think of it, maybe even for not-so hard times.