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International Journal on Research and Application in Science & Technology
2013, Vol. 01, Issue. 01, August-September
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Social Networking an Effective Marketing Tool
Abstract
Trying to acquire new customers is more costly than keeping the ones already have. Relationship marketing is geared
towards customers that are the most valuable for business. These customers expect great customer service and want to feel
like they have some kind of relationship with the company in hopes that the company will make them feel like a valued
customer. In turn, these customers are usually the most loyal and will spread the word about the business. The way to
execute a customer relationship program has changed in the last few years. Most businesses like to hand out discounts or
special customer appreciation promotions as well as personalized customer service. Today, social media is helping
corporations get closer to their customers in a way that is less expensive and more effective. Change in technology and
evolution of social relation online resulted in new way of marketing. Social Media has changed the way people connect,
discover and share information. Social media has become a platform that is easily accessible to anyone with internet
access. Increased communication for organizations fosters brand awareness and often, improved customer service.
Additionally, social media serves as a relatively inexpensive platform for organizations to implement marketing
campaigns Social media marketing is the way to use that technology to build relationships, drive repeat business and
attract new customers through friends sharing with friends. This technique of marketing is better than traditional way of
marketing especially for new emerging companies these companies get quick result and exposure through social media
marketing. Millions of people daily visit social media sites and blogs which help companies in getting long tail traffic for
a long period of time. The research paper focuses on what social media marketing is. The change it has brought in
marketing techniques which in turn leading to companies growth. It focuses on the way different companies utilizing this
technique to generate revenue and build loyal customer base.
Social Networking an Effective Marketing Tool
Ramu Dosawala is a popular man in Bandra. He has a road side stall off Carter Road from where he serves
dosas. His Mysore dosa is highly recommended. But the reason that he is popular goes beyond just the quality
of his food. It is because he recognises his customers. He knows their tastes, he asks about their welfare if they
haven’t been to his stall for a while and about their results after the exams. Ramu Dosawala has a loyal
customer base, and no, he doesn’t have a rewards program. There is an important lesson here for marketers.
We are so focused on being rational, that we think the best way to get brand loyalty is to bribe
customers with lots of rewards. Yet, experts keep advising us that customers prefer recognition way more than
rewards.[1]
Competitive Marketing Strategy (CMS) has relationship marketing (RM) as one of the key
functionality in enhancing business performance. Nowadays companies are realizing the use of social media to
build relations with customer. They recognize their customer need and offer them what was never offered
before. Social networking strategies are working nowadays for building loyal customer base. Social media
finds definitive use in functions as diverse as product development, customer service and talent management.
Depending on its needs, a firm may decide to start its social media journey by incorporating it in one or more
business functions. A good example of a firm that uses social media for product development is Clorox. It uses
a website called 'Clorox Connects' which enables customer participation in the creation of new product ideas
[2].
Social media is engaging with consumers online. According to Wikipedia, social media is internetbased tools for sharing and discussing information among human beings. Social media is all about networking
and networking in a way that espouses trust among parties and communities involved. Social networking is the
grouping of individuals into specific groups, like small rural communities or a neighborhood subdivision.
Although social networking is possible in person, especially in the workplace, universities, and high schools, it
is most popular online. Any website which allows user to share their content, opinions, views and encourages
interaction and community building can be classified as a social media. Some popular social media sites are:
Facebook, YouTube, Twitter, Digg, MySpace, StumbleUpon, Delicious, Scribd, Flickr etc.
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With social media on the rise, traditional internet portals such as Yahoo and AOL, once the front
doors to the online world, are being spurned in favor of social sites, where users are discovering a new, more
personal filter to the infinite world of the internet [3].Identity management, expert finding, context awareness,
contact management, network awareness, exchange are the six functionalities of an online community of
Twitter or FaceBook users. The role of social media is not limited to to these functions but it also include
marketing products, and has say in people movement as well[4]. Social networking sites such as FaceBook and
MySpace have become the party lines of this young century. They are inviting and intriguing and a powerful
communication tool. Learning how to use them wisely for marketing can increase your business profile[5].
Marketers should not underestimate the importance of social sites as a marketing tool as around 4 out
of 5 social site visitors use site's search function such as MySpace or FaceBook, perform searches on those
sites. Seventy two percent of internet users perform searches on iVillage, 77 percent on MySpace and 78
percent on FaceBook [6]. Conversation, a New York-based ad agency, has introduced SocialWhirled, a social
marketing campaign platform. SocialWhirled helps marketers launch social campaigns across mobile devices,
Facebook and other websites. The system provides a campaign management platform to monitor and analyze
social media campaigns[7].
Ford has realized the power of connectivity that social media provides to people and its extension to
the promotion of products and brands promotion. It is becoming easier and easier to interact with each other.
As everyone looking for human interaction, social networks help us satisfy this urge. The profile creation by
Ford is a strategic move for promotion on popular social networks such as Twitter and Facebook etc helps in
two ways. It gives them a representation on the websites and helps the interaction of employees with bosses.
Till now, Indians have only seen ministers like Shashi Tharoor, Businessmen like Anand Mahindra
aggressively presented on the micro-blogging website - Twitter. But under the recent move, Ford fiesta will
become the first tweeting car to be present on the website. The AJ, a 2011 Ford Fiesta has recently become the
first car that can tweet [8]. Companies such as Ford, GM and the likewise, in Michigan have given an access to
the social sites like Twitter, Linkedin and Facebook from the office premises.
Significantly different from conventional marketing strategies, Social Media Marketing (SMM) offers
three distinct advantages. One, it provides a window to marketers to not only present products / services to
customers but also to listen to customers’ grievances and suggestions. Two, it makes it easy for marketers to
identify various peer groups or influencers among various groups, who in turn can become brand evangelist
and help in organic growth of a brand. And, three, all this is done at nearly zero cost (as compared to
conventional customer outreach programmes) as most of the social networking sites are free. Social media
marketing helps in generating exposure to businesses, increasing traffic/subscribers, building new business
partnerships, rise in search engine rankings, generating qualified leads due to better lead generation efforts,
selling more products and services, and reduction in overall marketing expenses
There is a central concept here that many companies should consider: IBM believes the best way to
showcase its work and products is via its own staff. Their talent and enthusiasm acts as a great commercial for
all they do and by allowing its staff to use social media, the company is showing its faith in its employees and
by extension customers feel more comfortable and engaged by the brand.
The corporate world has lately been liking the social media because it has been discovered to be an
extremely effective way of raising awareness of a brand. Moreover, it's a fantastic method of marketing
services and products as the audience is a global one, and, what is more, it is generally receptive. Viral
marketing has a tendency to work very well through the social media and advertising campaigns are able to be
effective far quicker than with traditional media like magazine publishing, for example, where there might be a
gap of up to a month before there's any feedback or response from the audience. And, not only is the use of
social communicator a quick way of spreading the word about products and services, it's moreover extremely
simple to make changes and change focus with this medium unlike the printed media where, when something
has been printed, it is permanent and can't be altered. What's more, the social media are simple to use and do
not require specialized training meaning that companies can get word about the nature of the business out there
fast and easily.
The use of social networking services in an enterprise context presents the potential of having a major
impact on the world of business and work. Social networks connect people at low cost; this can be beneficial
for entrepreneurs and small businesses looking to expand their contact bases. These networks often act as a
customer relationship management tool for companies selling products and services. Companies can also use
social networks for advertising in the form of banners and text ads. Since businesses operate globally, social
networks can make it easier to keep in touch with contacts around the world.
Two examples of social networking being used for business purposes are LinkedIn.com and
Youngblackprofessionals.org. LinkedIn aims to interconnect professionals. LinkedIn has over 100 million users
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in over 200 countries. Youngblackprofessionals.org or YBP aims to do the same thing, but is targeted toward
professional minorities. .
Another is the use of physical spaces available to members of a social network such as Hub Culture,
an invitation-only social network for entrepreneurs, and other business influentials, with Pavilions in major
cities such as London, UK. Having a physical presence allows members to network in the real world, as well as
the virtual, adding extra business value.
Applications for social networking sites have extended toward businesses and brands are creating
their own, high functioning sites, a sector known as brand networking. It is the idea a brand can build its
consumer relationship by connecting their consumers to the brand image on a platform that provides them
relative content, elements of participation, and a ranking or score system. Brand networking is a new way to
capitalize on social trends as a marketing tool [9].
Many impressive social marketing happenings took place in 2011[10]. There is a marked rise in use of
social media by businesses worldwide as a tool to win new business, a recent study has found. An increasing
number of Indian companies are using social media as an effective business tool, the study said, adding that 83
per cent firms in India agree that without social media activity, marketing strategies cannot hope to be
successful [11]. While 83 per cent of Indian firms feel they cannot do without social media activity, the global
figure for the same finds 74 per cent of companies around the world in agreement with it. In India, 67 per cent
of firms encourage their employees to join social networks such as Linkedin, Xing and Video, compared to 53
per cent globally [12]. “From supply chain management, to leaner working practices, to cloud computing, to
increased use of video communications and mobile working, no area of business is being overlooked.
Particularly in India, where Nielsen has reported that three out of four social media users visit a social
networking site at least once a day, and a discussion forum once a week; more and more companies are
leveraging this channel to increase the loyalty of existing customers, and as a successful acquisition tool,”[13].
The global Regus survey findings are based on the responses of over 17,000 managers and business owners
across 80 countries. According to the survey, the last year has seen a rise in Indian companies using social
networks, blogs, micro-blogs and forums to win new business. In 2010 Regus found that 52 per cent of Indian
firms were successfully winning new customers through business social networking activity. A year later, the
proportion has risen to 61 per cent. The research also reveals that globally more firms are also using social
media to connect and engage with existing customers than a year ago.
The study observed that there is a rise of 7 per cent in the proportion of businesses successfully
recruiting new customers through social networks such as Facebook, while 52 percent of businesses globally
and 64 per cent in India use websites such as Twitter and Weibo to engage, connect with and inform existing
customers. In India 67 per cent firms encourage their employees to join social networks such as Linkedin, Xing
and Video, compared to 53 per cent globally.
The phenomenon of Social Media Marketing is reaping benefits for Indian Brands in both Branding
and Customer Acquisition perspectives. The Marketing Chiefs are excited to include Social Media Marketing
into their Mainstream marketing Campaigns. Majority of Indian Brands has a presence in Facebook and
Twitter. Social Media Marketing in India should blend Indian Culture in their creative mix, while engaging
with their customers in Facebook or Twitter. This would enable the brand to cater to the localized preferences
and tastes of their customers with whom they are engaging.
References
[1] Want Loyalty? Don’t focus on rewards, , http://www.firstpost.com,Jan 10, 2012
[2] Maximum Medium: Social networking strategies work for you when you work hard on the, http://www.
economictimes.indiatimes.com, 23 Dec,2011
[3] Friends, not editors, shape internet habits, www.ft.com, September 1, 2009
[4] 'Need to recognise social media's role in people's movements', www.moneycontrol.com, Dec 10, 2011
[5] How to Use Social Networking Sites for Marketing and PR, http://www.nytimes.com/allbusiness/AB11702023_
primary.html
[6] ‘Search function on social networking sites is popular with visitors’, http://www.bizreport.com/2007/04/report_1_n_5_
social_site_visitors_skirt_search_function.html
[7] Conversation rolls out SocialWhirled, http://www.btobonline.com , December 20, 2011
[8] Ford Fiesta – the tweeting car, Devang Murthy, www.topnews.in, August 23, 2010
[9] http://en.wikipedia.org/wiki/Social_networking_service
[10] Social splashes: Google, flash mobs and metrics, oh my!, http://www.btobonline.com , December 14, 2011
[11] Indian firms using social media to get business, http://timesofindia.indiatimes.com, June 8, 2011
[12] India Inc rely on social media for marketing: Regus, http://articles.economictimes.indiatimes.com, Jun 7, 2011
[13] Indian cos increasingly using social media to leverage business, http://www.firstpost.com , Jun 7, 2011