There are hundreds of differing opinions regarding the effectiveness of using social media for referral lead generation. It is essentail for the modern marketer to have a social presence, but it can't become the number one revenue driver all by itself. Although referral lead generation is potentially very powerful, it needs to be integrated into the overall marketing mix to truly reach its potential.
Social leads are often not ready to buy, and need to be nurtured properly. Throwing thousands of unqualified leads into your funnel every month is a complete waste of time if they are never going to buy your product. Target appropriately, and keep your content strategy focused on the pain points and hot topics around your target personas. Content fuels social media and underpins referral lead generation.
Social plays a key role throughout your entire sales pipeline, beginning before prospects are even identified (while they research and follow your thought leadership on social media sites), to after they become customers (as they remain loyal customers through retention, cross, and up-sell opportunities).
Using inbound alone to generate leads with social media is like hanging out with the same group of friends from elementary school your entire life. Adding a bit of paid promotion is the only way to break through to the coveted friends of friends, or second degree connections, for referral lead generation.