At least in every decade, an advance technological innovation emerges that significantly transforms the business arena. In all these cases, regardless of the earlier competitive environment, business that understands and carefully incorporate technology win, while those that fail to do so lose.
We had the mainframe computing in the 1970s. In the 1980s, the PC dominated the scene followed by the internet in the 1990s. Today, it is the online social media and graph. Social graph is a World Wide Web of people constructed by social networking sites, such as Facebook, LinkedIn, and Twitter, of individuals on the internet and how they connect.
Social media are emerging and perhaps will change everything we experience about “business as usual.” Social networking is penetrating across the internet, connecting people, businesses, products and services and bringing context about relationship to every Web site and software applications so that technology can be less of itself and more about social networking and people.
Social networks are sites used to connect people with other similar people. Successful networking sites ask users to develop profiles of themselves so that those with similar backgrounds, interests, hobbies, religious beliefs, racial identities, or political views can “meet” online.
What is in social networking for marketers? First, social networks enable marketers to reach influential people like journalists and consumers. Retailers consider them opinion leaders. Social networks create a significant opportunity for the development of a brand community.
Scholars assert that social networking and media are movements that affect us personally and professionally. They create an enabling environment for individuals to work from homes, be self-employed, and take care of personal and business matters at work Shih (2009).
Crucial business interactions, such as sales, recruiting, business development we create depend on the relations we have. Consumers’ decisions to buy a product or service can now be influenced by referrals and recommendations from colleagues, families and friends. Most of these recommendations and referrals emanates from social networking sites.
The pioneers of online social networking sites, such as Classmates.com and SixDegrees.com paved ways for today popular and viral sites like Facebook, LinkedIn, Twitter and Hi5, among others. As these sites continue to grow, their effects on both personal and professional lives of consumers are undoubtedly massive. Retailers find such sites useful in defining demographic information of their target customers and brands.
The report shall cover the key concepts such social media and brand development, new social media and brand community, sales transformation, and ethical issues concerning spamming and advertisement. The report further presents reflective learning by addressing the future of social media and brands.
Learning objectives
This report aims to address social media and brand in areas of social media and brand development, new social media and brand community, sales transformation, and ethical issues. At the same time, the report looks at the future of social media and brands. These issues form the key concepts of this report.
Key concepts
According to Singh (2010), retailers should open up their brands to customers and let them nurture it. This is difficult because of the resources involved in developing brands. The emergence of social media has enabled consumers to internalise brands, talk about them in their own words, and transform the brand story in their own ways. This act of allowing consumers to nurture a brand normally results into success.
Singh emphasizes that letting consumers nurture brand does not translate into losing control of it. This process must follow the company’s values, customers’ expectations, the industry of operation and brand appropriateness. Brands which lack customers nurturing run the risk of appearing cold, distant and alienating. The social media accentuate such risks to the point of brand withdrawal.
Marketers have realised the necessity of being where their customers and potential customers are. These places are social networking sites. The sites boast of hundreds of millions of active subscribers. Alexa (a Web site monitoring visitors of other websites) ranks Facebook and MySpace as among the most visited sites in the US. This is where the market is. This is where brand nurturing and development occur.
For instance, iPad’s branding strategy created some waves in the social media. In the year 2010, during the launch of the new iPad tablet, many women immediately tweeted, posted and blogged associating the name to feminine hygiene products such as iTampon. The nurturing of the iPad by customer erased all the confusion that existed about what category the brand represented.
Brand development pundits insist that a company should adhere to four easy steps when choosing their brand name. These consist of easy to tests, spell, read and remember. Likewise, a brand name should fit four ways, namely, target market, product’s benefit, customer’s culture, and legal requirements (Solomon, Marshall, and Stuart, 2009).
Development of the internet has created systems of sharing information fast leading to overload. This makes it close to impossible for marketers to target their consumers with an intended message, and visitors to find information about various brands.
Social filtering and hyper-targeting counteract the problem of information overload. The brand managers are able to engage the right customers with the exact conversation and at the expected time using these methods. These aspects provide people with massive control of their Web experience by finding contents relevant to their needs.
Social media are emerging as formidable and sophisticated forces in brand building and marketing. They are making marketing and branding precise, personal and social.
Social media are giving retailers new ways to hyper-target/micro-target their customers with campaigns using profile information, tapping community friendship and carefully nurturing the use of word-of-mouth branding across their existing clients (Singh, 2010).
In the process of nurturing brands, users have created product review sites to enable consumers and retailers post stories about their experience with the products or services. Retailers hope that the reviews would create a link between consumers and their brands. Brand review sites contain both negative and positive comments about the product and company.
Some of the most influential review sites include TripAdvisor which provides an uncompromised hotel and restaurants review complete with photos and advice. This site enables consumers to rank and comment on the hotel they stayed in or use other users’ comment to choose hotel for their forthcoming stays. Yelp enables customers to get local business reviews such as where to eat, drink, shop or play.
Yelp employs both the use of the internet and mobile phones. The online form of Zagat Survey gives reviews on hotels and leisure activities in more than 100 countries from surveys of more than 375,000 users. Zagat also incorporates the use of mobile phones, internet and in-car personal navigation equipment.
At the same time, there are also available encouraging opportunities for business to business (B2B) social media marketing. B2B also have social media and networking profiles that they can target in their advertisements.
Users of social networking and media sites feel that they are in a friendly environment when they log in to their sites. What users see targets them. Social media advertisers have access to customised portal for each member.
However, despite the readily available target market, users have low purchase intent. It is debatable whether influences from friends and profiles can change the users’ decisions to make a purchase. Critics also wonder whether online social media and marketing sites will be able to incorporate all the constituents of online marketplaces, search, and comparison of products sites. This will create high intent for the user to buy.
A brand community is a group of people organized around a lifestyle or idea that is representative of a brand. The brand community members are admirers of the brand, and share in the rituals and traditions they associate with it. They feel connected to the brand and as a result, they bond with each other (Brown, 2010).
Retailers know social media to create a buzz for the products and services. The new social media platforms are now essential updated communication models. User can create their own contents and share them with fellow users who access those sites. The only challenge unknown to marketers is how social media will change the way consumers interact with products and services.
Social media give the consumers opportunities to shape brand concepts and promote them in their communities (Barefoot and Szabo, 2009). This system creates companies brand ambassadors who help spread the words about brands.
However, the challenge is in regulating the spread of unwanted messages about brands. In fact, social media are the fastest means to spread negative comments about almost all subjects, including poor experiences with brands or services (Reece, 2010).
Retailers will find social media as the place to be in marketing and magnifying their products and services. Organizations which have not thought of how to exploit these platforms are losing out. Advertisement pundits note that even the oldest brands like Pizza Hut, McDonald and Church’s Chicken are now inventing ways to shift large portion of their advertisement budget to social media platforms.
These corporations command over a million of followers on their social media pages. These fans are blogging about all the fascinating things about pizza and chicken in their favourite places. Retailers can exploit social media platforms like blogs, wikis, podcasts, picture and video-sharing sites and forums, among others. This is how Harley created brand community for riders.
The company sponsors successful rallies around the country where members can meet and talk about their bikes. The company noticed a revenue growth of over 4 billion US dollars during the recession of the year 2009 (Halligan and Dharmesh, 2009).
We all know that selling is a basic and an essential process based on mutual trust. People like engaging in business with the people they trust. Marketing environment is embracing changes as it comes. Today, democratisation of the marketing environment is creating competitions and savvier buyers empowered with information.
Therefore, sales people must work hard to maximise the customer relationships and sales, of course, with limited resources. A timely fulfilment of customers’ needs and interpersonal communications are now vital for closing sales deals.
Marketers can take advantages of the emerging online social media as the essential business tools to promote insights and communication about their products and services. The technology conscious firms are embracing the use of software to handle all customers and company interactions (Sterne, 2010).
Companies are adopting the use of technological innovations to transform selling process. An example of a Smartphone is today’s communication hub of the transformational relationship between the client and marketer (Chaney, 2009). However, the essential elements of customer relationship management (CRM) do not rely on technology alone.
This is because the relationship is between people and not the social media. The CRM software creates an enabling environment for marketers to do their jobs. One such software is the Goldmine, which helps salespersons to manage their clients and create base of prospects. These programs are user friendly and can track all elements of customer and company interactions (Qualman, 2009).
The evolving technology now creates even advance applications like cloud computing CRM applications such as SalesForce.com. Progressively, keen companies are adopting a new concept of partner relationship management (PRM), which creates a link between selling and purchasing companies.
Companies now have teleconferencing, videoconferencing, and new and improved Web sites with a section of frequently asked questions (FAQ) to cater for customers’ questions. Some use blogs and intranets to facilitate both internal and external communication (Evans, 2010).
A popular Voice-over Internet protocol (VoIP), Skype enables webcams and instant messaging. Consequently, customers are comfortable with the concept of conducting business with far away retailers. Transformation of face-to-face sales will just take place in the computers.
People have been shopping online for years now. A new world of virtual selling is an example of how social media and the internet are transforming business and defining new job descriptions. Savvy salespersons can mix both technology and personal touch to increase sales and improve customers’ relationships (Brogan, 2010).
Developments in social media and networking have created a chance for retailers to send unsolicited mails to their customers and potential customers alike. These direct-mail offers overwhelm potential targets who direct them to trash. For instance, during the boom of credit cards, there were endless offers from companies targeting same potential customers. In some instances, spamming has resulted into court cases.
As such, direct-mail companies are regulating their frequencies and providing customers with the options to unsubscribe from their mailing lists if they so wish. However, instead of sending junk mails, social media tend to use passive interrupting advertisements on user profile or status message.
This attracts interested people to follow their links and view their offers. Social media offer opportunities for those who are not well connected or are not part of the mailing lists to sample products and services. This way they are avoiding junk messaging and providing sampling opportunities to potential consumers (Falls and Deckers, 2011).
Since social media have various forms of advertisement, they cannot avoid ethical debates people associate with advertisement. Consumers will find social media advertisements as intrusions into their private lives. Ethical issues consumers consider are almost similar to those raised in the traditional advertisement channels.
Social media advertisements are manipulative as they tend to lure users with phrases like “click to win” or “order now and get 50 per cent discount”. People end up engaging in impulse purchases because of such advertisements. However, consumers are free to choose whether to ignore such messages or respond to them.
In social sites, the graphical representations of brands sometimes are deceptive and untruthful. Consumers may believe the false representations and act on them. However, retailers are trying to represent their products and services as accurately as possible since it is an offence is some countries to misrepresent products.
For instance, in the US, the advertisement industry must regulate itself and in case of failures, Federal Trade Commission (FTC) takes necessary legal actions against such companies. The FTC also forces the alleged company to run corrective advertisement (Arens, 1999).
Sometimes social media advertisements resort to the use of puffery. Puffery is difficult to prove whether they are true or not. However, advertisers take these opportunities to create biased impression of their products and services. For instance, Nivea claims to be the world’s number one in skin care.
Such claims are difficult to prove. They lead to issues of ethical dilemma, and both the advertiser and the consumer now accept them as part of the advertisement. Social media advertisements are trying to create marketing communications, which are both honest but with little exaggerations. This prevents consumers from becoming overly distrustful of the advertisement claims. Firms end up gaining in the long run.
Occasionally, advertisers may use far-fetched humour, sex appeals, or fear appeals to capture attention of their target audience. Some consumer might regard these forms of communication as offensive and in poor taste. Some consumers may shy away from them and avoid messages intended for them.
Social media have created generational gaps and stereotypes. Advertisers may present a certain group of users in unfavourable manners. Critics argue that the internet divide we witness is as a result of social media perpetuating stereotyping for those who are not technological savvy.
Technology offers nothing for those who are not familiar with its navigation paths. Supporters point out that technological is advancing. Therefore, people who are behind it should not claim stereotyping. Some forms of stereotyping already exist in the culture and do not occur as a result of social media promotions.
Reflective Learning: The future of brands and social media
Online social media for business is evolving and rapidly developing. New possibilities, jargons, integrated user interfaces, and vendors are emerging every day. In this context, retailers and consumers should gear their mind-sets to ever increasingly complex social media platforms.
Therefore, retailers must utterly reconsider their interactions, relationships and business strategies. Social media allow relationships and business issues to drive business decisions, strategies, brands and services (Safko and Brake, 2009).
The emerging new technologies are creating innovator’s dilemma. This is the inability of leading companies to adopt and embrace pervasive new technologies because they disrupt their existing business systems. This was the case of Eastman Kodak. Kodak took so long to embrace digital photography as its market share was declining. Digital photography revolution was consuming the traditional film cameras.
Kodak found out that it was unable to adapt. The company thought that the digital photography would kill its core business, which relied on the traditional print films.
Consumers and retailers might experience this same scenario in the era of social media and internet revolution. Therefore, retailers should pay keen attention to the evolving social media trends in their industries around products and services innovations, sales and marketing (Paine, 2011).
Social media and networking is now becoming the norm in products and services sales. We are most likely to experience sociological shift in consumers’ behaviour toward interactions and relations with various brands. Doing business will mean that retailers will put more value on social capital than in other areas of communication.
At the same time, technologically savvier people will have disproportionate advantages over the rest. Scholars expect the advertisement industry to shift dramatically to social capital as purchasing trends become digital (Bingham and Conner, 2010).
Retailers are shifting their products toward social strategies. Similarly, this move will force IT departments and technology sellers to involve much of social media and social networking in the platforms they provide. Chief Information Officers (CIOs) will make critical decisions regarding the benefits of embracing social media and conversely, the risks they associate with not embracing it.
A significant model is a WorkLight company which has been able fully to incorporate social media in its operations. The company has been able to incorporate Facebook, iGoogle, and the iPhone to focus on efficiency and user adoptions. They provide relevant data in a timely and secure platform (Poynter, 2010).
Social media and networking has drastically reduced the costs of business operations, eliminated boundaries and democratised who can run and start a business. We are mostly like to see a number of sprouting small business with lowered costs and hassles. Areas of outsourcing and crowd-sourcing are likely to benefit from new developments in IT.
Online social media and networking provide possibilities, and affordability for various businesses to provide personal relationships, with individual customers and communities. Organisational boundaries are opening up for improved collaboration (Anderson, 2010).
For instance, Sales force to Salesforce is a social network of companies. Companies can share data related to opportunities, contacts, sales, accounts and tasks with suppliers, partners, vendors, and customers who use Salesforce.
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