Social Media in Business - Coursework Example

Social Media in Businesses Name Institution Social Media in Business Executive summary As the world changes, social media has become popular with more than a half of the population in the united states connected to it. It is used in advertising, sales, branding, public affairs and in-house communication. It does not limit the kind of businesses that can use it. Success of social media in business activities largely depends on strategy and management, though it is easy to manage. Though it is not easy to measure investment on return of social media, aspects considered during evaluation include sale volumes, costs of operation and leads generated. A monetary value need to be fixed on each lead for calculation purposes. Furthermore, there are policies guiding formulation and operation of social media that need to be implemented if desired results are to be achieved. Introduction Social media any form of interactive communication using a web. It offers a two-way communication forum where communities, individuals or organizations share ideas on particular issues. From a study done in the United States, social networking sites such as facebook and twitter take up twenty-two percent of time spent online. Further, sixty-two percent of the population in the United States used facebook in the month of April 2010 (Nielsen wire, 2010). As a business tool, social media is mainly used in marketing and public relations. It has not been fully exploited for sales and collaboration with customers, (Josh, 2009). For small and midsized enterprises, using social media for communication, branding, enquiring about customer needs and sales is efficient in terms of operational costs. Following the large number of society connected to social media-facebook, linkedIn, twitter- it is important to take advantage of it to maximize business output. In addition, small and medium sized businesses use social media more compared to large companies, therefore, the potential to reach out to large number of potential customers is high, (Josh, 2009). This paper therefore focuses on the most relevant social media applications in small and medium sized businesses, their benefits and management practices necessary to reap maximum output. Applications of Social Media Social media is an effective tool for sales purposes. The principal of future work by Brian Solis states that, human interaction does not change, only the means by which human interact (Rossi, 2009). Therefore adopting this new mean of interaction is a benefit to a business. It enables one to maintain contacts with customers, prospecting and evaluation of attitude towards the business. In addition, actual sales as well as gathering information before sales is possible with social sites. For any business to be operational, its outputs need to outweigh inputs. In addition, operational costs need to be minimized as possible in order to raise the profit margin. This is possible with social media as running costs are low. According to Josh, sixty seven percent of businesses use social media to maintain contacts with customers and another fifty percent to study customers’ attitudes (Josh, 2009). Another important application of social media in businesses is marketing. Before sales are made, a business needs to be known to potential customers. However, businesses today face a lot of competition especially from big companies. Thefore a tool of marketing, which is free and reaching out to large numbers of people need to be put in place. Taking advantage of the social media as a marketing tool plays a major role in widening the profit margin of a business. According to a survey carried out by Josh, fifty-six percent of the respondents used media sites to promote their businesses and another fifty three percent to monitor trends with their customers (Josh, 2009). Social media enables the business proprietors to interact with customers, making them feel as part of it thus creating loyalty. In addition, this interaction enables customers express their feelings towards the product or service offered and suggest ideas to improve it. “Social media tools are popular marketing tools because they are free, people are already using them, and there is an opportunity cost for not getting involved today” (Rossi, 2009). To optimize social media as a marketing tool, one needs to select the best site for the business. Communication is imperative to any kind of business. With a new business, public relations are vital in making the business known. First hand, communication builds customer confidence. Therefore, social media sites play a major role in public relations, which would have otherwise been an extra cost to the business. Social media is said to break news and monitor business activity and its products. It is said that news about a plane that landed in Hudson river in the united states was first reported by an eye witness vie twitter (Rossi, 2009). Maintaining a business profile, interacting with bloggers and members of other social sites and creating awareness of new products and services are some of the ways customers interact with the business. In his survey, sixty-six percent of the respondents use social media to maintain a business profile and more than a half use it to release news and new products (Josh, 2009). It is therefore a good means of cutting advertisement costs through traditional media. To create loyalty with customers, businesses should ensure regular communication by updating their status, responding to customers’ comments, uploading pictures and videos as well as participating in social responsibility. Social media is used for in-house communication in a business. For midsized businesses, with a number of employees, using social sites to communicate saves on operational costs. From a survey carried out by Josh, fourty two percent of the respondents used social media to share documents and a similar percentage to communicate with team members. An additional thirty two percent used it for interaction. Other uses are coordinating work schedules and creating internal working group, (Josh, 2009). Security when transferring business information via social sites is not guaranteed. However, this challenge is overlooked because there are no operational costs incurred, (Rossi, 2009).Within a business, social media is used to conduct trainings, team building and keeping contact with past employees. Small and medium businesses can exploit these applications by maintaining active social sites. Once a business opens, however small it is, a website is important as a tool to interact with customers. Where a website is not possible to create, one may create a page with their personal accounts and invite friends to the page. As Peter Drucker, known as the father of modern management, said, "The purpose of a business is to create a customer” (Rossi, 2009). In addition, the page is regularly updated. Posting new pictures and videos creates interest in customers. It is important to add a list of friends. This is done using search engines; Google + and twitter are commonly used. With the search engines, one connects with other big businesses offering the same services and products as the business in question. When this page is shared by the big company, then one has a potential of reaching out to many people. On facebook, one may start by connecting with real friends, employees and gradually the chain grows. One may also pay a small fee for their page to be advertised. On twitter, one may follow large companies offering the same services and comment on them. Gaining trust with the blogger may lead him to following the page in question thus gaining followers (McNicholas, 2011). Interacting with members of these pages is vital. It builds confidence and trust by customers. Small and medium enterprises have the potential to increase their customer base through social sites. They are easy to use as they do not have a formula or official way to use them. Therefore a professional is not needed to manage the accounts. The entrepreneur manages his or her own accounts. In addition, social media is costless to both the entrepreneur and customers, making it perfect for small and medium enterprises. Another benefit of social media is the number of people one reach out to at ones. It reaches a great number of people compared to traditional media. Additionally, it offers a two- way communication with customers, the entrepreneur get to know the attitude of the clients towards the business and products (McNicholas, 2011). One important thing to note is that social media cannot be entirely used as a means of marketing. From the statistics discussed above, not a hundred percent of the population is connected to social sites. Therefore, other means of advertisement and promotion of a business need to be used. However, little investment may be put in this depending on the return on investment of from these web business dealings. Presently, social media is used by many kinds of small and midsized enterprises round the globe. These include artists, gym instructors, musicians, writers, transport companies, funeral services, yoga instructors, restraints, clubs, churches, organizations, real estate’s brokers, car dealers, bakers, wedding planers and many more. Thus, it is effective as a medium of doing business and fit for any kind of business. However, the approach used by the entrepreneur the level of effectiveness of the business. Additionally, just like any other kind of marketing strategy, management of social media sites influences return level for a business. Therefore, evaluation levels of success gained is inevitable. With this, one is able to identify areas of improvement needed with the social media in place (McNicholas, 2011). Management of Social Media With social media sites, it is important to look through competitors’ accounts to identify their target customers, loyalty of customers to their business, number of friends and followers they have and responses by customers about their products. This gives an entrepreneur a picture of the competition and potential a business to beat the competition. One also networks through these accounts. To determine whether is successful as a business tool, return on invested need to be evaluated. There need to be a break even for the investment to be considered worthwhile. With a successful social media, the levels of sales should increase. As discussed above, a sale is one of the applications of social media strategy in business. In addition, costs should decrease. These are costs used in other means of advertisements (Matmoninternet, 2012). In addition, it is considered worthwhile if perceptions of the brand have changed. As a marketing tool, it should change peoples’ perception of the products and services the business offers. This is from responses offered by customers and advertisement of the business. In addition, the entrepreneur should be in a better position responding to issues affecting brand reputation (Matmoninternet, 2012). Return on investment is also measured using leads generated. These customers are accessing contact information of the business. Leads generated by social media are separated from other sources by using URL tagging or a custom segment comprising all social media sites in place. A monetary value is then attached to each lead so that one is able to calculate return on investment. In addition, ROI is measured using the number of times customers share the page. Sharing the page is a networking strategy as more people get to view it, (Matmoninternet, 2012). Social Media Policy Social media policy is formulated immediately a business signs up for it. All members running the business should take part in formulating the policies. Before formulating policies for the media in place, taking an in depth survey of every social media and their extent of success is vital. It enables one to set a higher standard so stay above the competition. In addition, a media that encourage member participation rather that competition is deemed appropriate. The draft policy should introduce the purpose of the social media. It should be focused on positivity both to the employees and the customers thus should focus more on what the employees can do instead of what they cannot (Lauby,2009). Secondly, taking responsibility of what is written. Whatever one writes of the page reflects on the business, thus the content should always be positive and true. To control content posted on these walls, a system regulating security, account management and legal aspects should be put in place. In addition, full details of the business should be given. That is, location, address, name and title of the business and proprietor. This creates confidence in customers (Lauby, 2009). The target group of the sites should be considered. These include current customers, potential customers, employees, past and future employees. It should also address the extent of personal use by employees, presentation, respect and responsibility. The community, being the main target of the site should be considered. Striking a balance between professionalism and personality of contents, supporting it, and being transparent are some aspects that trigger support from the community (Lauby, 2009). Not all business information is public. Protection of confidential information is vital. Transparency does not entail giving every detail about products and services, thus business secrets should be protected. Employees should be barred from sharing secretive information. In addition, striking a balance between social media usage and real work by employees is important. While communication plays a major part in the success of the enterprise, real work is vital too. It is what brands the business and products (Lauby, 2009). Conclusion Social media has different applications in businesses. It is used to market a business, sell, get information and communicate internally. It has no operational costs and needs little professionalism. Therefore, a proprietor can use it without necessarily hiring a public relations manager. As the world of information technology changes, people are accessing information about almost anything from the internet. In fact, if social media were a country, its population would outdo that of most countries. In addition, two- way communication provided by social media enables customers receives first hand information, thus building confidence and loyalty with the business. As matter of fact, a customer is the target for any operational business; therefore, orienting business products to match customer needs is inevitable. Understanding these needs is easy thorough social media than other traditional means of advertisement. Therefore, accepting social media in sales, public relations, marketing, and making internal communication to employees are all ways in which these businesses can make use of social media. Introducing a business to social media needs a strategy to target the right customers, a large number friends and follower, posting relevant content, participating in social responsibility and responding to customers positively. As in every institution, policies governing use ad access to social media in a business should be laid in collaboration with partners and employees of the business. This is to ensure responsibility when using the sites. . References Gordon, Josh 2009, The Coming Change in Social Media Business Applications Separating the Biz from the Buzz, Whitepaper Survey: MNA Kym, McNicholas 2011, How to Use Social Media to Promote Your Small Business. Retrieved on 19/4/2012 from Forbes (9/19/2011) /www.forbes.com/sites/kymmcnicholas/2011/09/19/how-to-use-social-media-to-promote-your-small-business/ Matmoninternet January 26th, 2012, How to Measure Social Media Effectiveness. Retrieved on April 19th2012 from: www.matmon.com/resource-blog/social-media-marketing/how-to-measure-social-media-effectiveness Nielsen wire, Social Networks/Blogs June 15, 2010, Now Account for One in Every Four and a Half Minutes Online. Retrived, 19th April 2012 from http://blog.nielsen.com/nielsenwire/global/social-media-accounts-for-22-percent-of-time-online/ Rossi, L Canali October 7, 2009, Business Applications of Social Media Inside Organizations: Social Networks. Retrieved, 19th April 2012 from http://www.masternewmedia.org/business-applications-of-social-media-inside-organizations-social-networks/ Sharlyn, Lauby June 03, 2009, 10 Must-Haves for Your Social Media Policy. Retrieved on April 19th 2012 from http://mashable.com/2009/06/02/social-media-policy-musts/ Read More