How Big Business Is Reevaluating Social Media
Only a few years ago, all of the buzz surrounding social media for Internet marketing painted it as a huge new source of web traffic, and so ultimately of sales conversions too. The picture of how useful social media is as a marketing tool has changed now that we have had some time to evaluate its contribution to the sales stream. Social media marketing is still a valuable promotional tool, that part of the predictions have indeed come true, but it is how social media marketing is used that has evolved as we have come to understand how people use social media. Big business is heavily invested in social media, with 62% of Fortune 500 companies having an active Twitter account and 58% with Facebook brand pages1, but they are changing their focus when it comes to how they spend their time and money on social media marketing.
When General Motors announced that they were cutting $10 million in Facebook advertising many commentators were quick to herald the end of social media advertising. In fact, GM is still going to spend $30 million with Facebook; they have only decided that they won’t go ahead with their CPC campaign on the site2. They still intend to use Facebook as an engagement tool to keep in touch with their customers, which is becoming the direction that most big business seems to be heading with their social media marketing strategies. Rather than using their presence on Facebook to make hard sell pitches or to run premium advertising they are there to keep their brand name in the public eye and to connect with their customers on a conversational level, in support of their more aggressive marketing in other areas of their advertising strategy.
The other area where big business is employing social media is in their internal communications. Many large, widely spread businesses are using social media platforms as a means for keeping their employees in contact with one another to streamline the management process. Social media has been found to be an effective tool in the research and development of new products since it allows businesses to match the skills of employees regardless of their location. Therefore, it is helping to solve problems and build cohesive teams3. Since 2008 internal social networks run by businesses to connect their employees is up by 50%3, and is becoming as indispensible to running the company as the telephone and e-mail are.
Staff recruitment is another area where big business is making effective use of social media as they leverage the huge pool of potential employees on sites like Linkedin and Google+. This new path to employment allows both employers and employees to find out about each other long before they actually sit down to discuss a position face to face, and streamlines the hiring process while at the same time targeting the best possible candidates.
Big business will continue to use social networks to keep their brand in the public eye, but as they come to understand what social networks do best they will continue to develop innovative ways to employ them in their business process outside of the cheap advertising opportunity they present, which has become one of the least effective ways to use Facebook. Along with cloud computing and virtual desktop services, social networks seem set to change the way that we run businesses in much the same way that telephones did over a century ago. There will probably always be marketers that will take the low percentage road of hard sell on social media, but the smart money at the top end of the market will be the model that gets the biggest return on the time and money that they invest in their social media use.
References:
1. http://www.webpronews.com/big-business-on-social-media-infographic-2012-03
2. http://www.businessweek.com/articles/2012-05-22/why-gm-and-others-fail-with-facebook-ads
3. http://www.usatoday.com/money/economy/story/2012-05-14/social-media-economy-companies/55029088/1
