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THE HORIZONTAL
REVOLUTION
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Chapter 1
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Chapter Objectives
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What are social media?
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How does the Social Media Value Chain explain the
relationships among the Internet, social media channels,
social software, and the Internet-enabled devices we use
for access and participation?

What is Web 2.0?
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall
Chapter Objectives (cont.)

What are the major media channels associated
with social media?
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What is social software?
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Why is social media valuable to marketers?

What marketing objectives can organizations
meet when they incorporate social media in
their marketing mix?
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You’re a DIGITAL NATIVE!
You are constantly ‘wired’ in the networked,
always-on world.
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Web 2.0
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The interactive social system that is available to
users 24 hours a day, 7 days a week.
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Horizontal Revolution: Today information flows
ACROSS people, not just from big companies to
people
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Social Media: The online means of
communication, conveyance, collaboration and
cultivation among interconnected people,
communities and organizations
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Living a Social (Media) Life
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The Internet and its related technologies make
what we know today as social media possible
and prevalent.
 Synchronous
Interactions: Occur in real time
 Asynchronous Interactions: Do not require all
participants to immediately respond
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8-1
If Facebook were a country, it would be the
third most populated in the world!
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9-1
Social Behavior and the Philosophy
of Participation

Culture of Participation: The ability to freely
interact with other people and companies; open
access to venues that allow users to share content.
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Social Media Zones
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Media: a means of communication
 Mass
Media: means of communication that can reach
a large number of individuals
 Personal Media: channels capable of two-way
communication on a small scale
Social Media crosses the boundaries of mass and
personal media
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
Communication travels using a medium (or
channel) such as word-of-mouth, television,
radio, newspaper, magazine, signage, Internet,
direct mail, or telephone.

Within each medium, marketers can choose
specific vehicles to place a message.
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The 4 Zones of Social Media Channels
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Zone 1: Social Communities
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Social communities: channels of social media
focusing on relationships and the common
activities people participate in with others who
share the same interest or identification.
Channels in the social community zone include:
* Social networking sites (SNS)
* Message boards
* Forums
* Wikis
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Social Networking Sites
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Online hosts that enable site members to construct
and maintain profiles
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Social identity – profile picture or avatar and basic
information.
Social presence – indicating availability, mood,
friend list and status.
Connection – friends, followers or fans.
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Social Media Zones and Exemplar
Vehicles
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Forums
The oldest venue of social media. Essentially
forums are interactive, online versions of
community bulletin boards.
Wikis
Collaborative online workspaces that enable
community members to contribute to the
creation of a useful and shared resource.
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall
Zone 2: Social Publishing
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Social publishing: sites which aid in the
dissemination of content to an audience.
The channels of social publishing include:
* Blogs
* Microsharing sites
* Microblogging sites
* Media sharing sites
* Social bookmarking
* News sites
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Blogs
Websites that host regularly updated online content
Microsharing Sites
Work much like blogs except there is a limit to the
length of content you can post
Media Sharing Sites
Host content but also typically feature video, audio,
photos, and other presentations rather than text
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Zone 3: Social Entertainment
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Social entertainment: encompasses channels
and vehicles that offer opportunities for play and
enjoyment.
Social entertainment includes:
* Social games
* Socially enables console games
* Alternate reality games
* Virtual worlds
* Entertainment communities
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Zone 4: Social Commerce
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Social commerce: encompasses channels and
vehicles that offer opportunities for play and
enjoyment.
Social commerce includes:
* Reviews and ratings
* Deal sites
* Deal aggregators
* Social shopping markets
* Social storefronts
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Web 2.0: The Defining
Characteristics of Social Media
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The Web Is the Platform
User Participation, User-Generated Content,
and Crowdsourcing
User-Defined Content
Network Effects
Scalability
Perpetual Beta
Reputation Economy
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The Web “IS” the Platform
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Cloud computing. The general term for
anything that involves delivering hosted services
online.
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User-Defined Content
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Taxonomies are classifications that experts
create.
Folksonomies are sets of labels (tags)
individuals choose in a way that makes sense
to them.
Tagging refers to the process social media
users undergo to categorize content according
to their own folksonomy.
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Network Effects and Scalability
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Network effects. The value added for all users by
each individual user.
Scalability. The ability to grow and expand
capacity as needed without negatively affecting the
contribution margin of the business.
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Perpetual Beta and Reputation
Economy
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Perpetual Beta. Developers are able to
introduce new features in products even if
testing and refinement are not yet complete. It
is continual, on-going development.
Reputation Economy. The value that people
exchange is measured in esteem as well as
money.
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall
The Infrastructure of Social Media
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Social Software are computer programs that
enable users to interact, create, and share
data online.
Devices are products we use to access the
Internet and to participate online.
People interacting online is the only way
social media can work.
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Show Me the Money!
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Business Models and Monetization
Psychic Income
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Marketing is the activity, set of institutions, and
processes for creating, communicating,
delivering, and exchanging offerings that have
value for customers, clients, partners, and
society at large.
The marketing mix includes the
4 Ps of Product, Price,
Promotion, and Place
(distribution).
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The 5th P of Marketing
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Today, we need to add the fifth P to the
Marketing Mix.
Participation
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Marketing Communication: From
Top-Down to Bottom-Up
A micromarket is a group of consumers once
considered too small and inaccessible for
marketers to pursue.
Niche products appeal to small, specialized
groups of people.
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Social Media Achieves Marketing
Objectives
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Promotion and Branding
Customer Relationship Management and
Service Recovery
Marketing Research
Retailing and E-commerce
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Social Media Achieves Marketing
Objectives (cont.)
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Social Media Achieves Marketing
Objectives

Promotion and Branding
 Extend
and leverage the brand’s media coverage
 Influence the consumer throughout the decisionmaking process
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Core Types of Media
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Paid Media: Media for which you assessed
monetary fees
Owned Media: Media channels the brand controls
Earned Media: Media channels beyond the control
of the company
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The Role of Social Media in the
Consumer Purchase Process
Increase Awareness
Influence Desire
Encourage Trial
Facilitate Purchase
Cement Brand Loyalty
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Social Media Achieves Marketing
Objectives
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Customer Relationship Management (CRM)
and Service Recovery
 Social
CRM uses software to fine tune the offer
and build intimacy with the customer
 Social recovery is the actions an organization
takes to correct mishaps and win back unhappy
customers Retailing and E-commerce

Retailing and E-commerce
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall