It’s 8.45am. I sit at my desk, check my Facebook profile and laugh at my friends’ shenanigans over the weekend. I answer a poll “Do you know if Volkswagen runs diesel engine cars?” and join the group “People against Doilies” (I can’t believe there are others who think like me!). I poke a couple of people and heave a sigh of relief. I got my hit. I’m ready to start my day.Social networks like MySpace, Facebook and LinkedIn started as a way for people to stay in touch. Like email on steroids, it has exploded into a powerful medium with endless possibilities, mostly unexplored by the business community.
The benefits for personal users are obvious, but what has it got to do with business? A lot, actually. The ability for social networks to infiltrate a particular demographic lends itself well to effective marketing. Imagine gaining access to a community that shares common interests in an informal and intimate, soul-baring setting. What could be a more perfect environment to conduct a survey (like the Volkswagen poll), test a new product or idea (an alternative to doilies?), market a business or recruit talent?
In the US, Ernst and Young uses Facebook to reach university graduates looking for their first big break. Its Facebook page features resumé tips, feedback from employees and videos of its interns. Similarly, the CIA (yes, that’s right) launched its Facebook page in December 2006 to hunt for potential government spies. Michelle Neff, a CIA spokeswoman, believes it’s an invaluable tool in peer-to-peer marketing.
Before anyone dismisses this approach as a fad, HCL Technologies in India claims that with a team of recruiters scanning blogs and social networks, 7-10 percent of their recruits come from social media. They also claim these sites are responsible for around 25-30 percent of senior-level hiring such as group managers and general managers.
Not surprisingly, icWales reported that in a November 2007 survey 8 percent of UK employers use social media to complement reference checking, making one’s Facebook or LinkedIn profile an online extension of one’s resume.
In the area of marketing, the possibilities are only limited by one’s imagination.
Entertainers, event organisers, bars and nightclub venues use it to reach clubbers and party-goers. The success of English Indie band Arctic Monkeys demonstrates how popularity in MySpace can shoot a band to the top of the charts without the marketing cogwheels of a big recording company.
Even the luxury goods market is jumping on the bandwagon with Burberry, Cartier and Land Rover trialling a niche site ASmallWorld.net.
Companies like Cadbury did not anticipate the power of social networks until it was forced upon them. Overwhelmed with 14,000 people who signed up to various “bring back Wispa” groups on Facebook, Cadbury in the UK re-introduced the Wispa bar early last year – four years after it had ceased production. It shows that companies are not always in touch with the marketplace, leaving marketers to seriously contemplate the real potential of social networks.
With any venture, there are also pitfalls. When Walmart plunged into the social media pool with a Facebook page in a bid to reach the pockets of millions of university users, a public backlash ensued and Walmart was grilled by its detractors. Delving into social networks can be risky business but in the hands of the astute, it can be a powerful marketing tool.
On home turf, our appetite for social networks increased by 114 percent from July to October 2007 favouring MySpace, Facebook, YouTube and Bebo according to Hitwise. If this isn’t a clear sign of a great wave of opportunities to come, I don’t know what is.
Beyond the dominance of MySpace and Facebook, sites like Buzznet and iMeem are establishing themselves in niche circles in the U.S. So don’t be surprised if MySpace or Facebook are challenged by a newcomer in the near future. Whatever guise they adopt, the social networks of the future will remain communication platforms that serve multiple purposes, neatly intertwined with our personal and professional lives.
Now if you’ll excuse me, I need to check my Facebook profile again.
James Richardson is a Melbourne IT eBusiness consultant who, in between social networking, enjoys helping budding entrepreneurs start, grow and manage their businesses online.
