Companies are beginning to realise that what started as innocent networking and communication between students or the younger generation, has now become mainstream and has the potential to radically change the way companies interact with their customers.
You cannot read a technology blog, a PR or media magazine, or in fact, any newspaper, without reading something about Web 2.0 and social media, talking about a paradigm shift in the way people communicate and interact using the Internet. And more and more of these articles are about how social networks like Facebook, twitter or YouTube are affecting our day to day lives.
What benefits do companies get from using social media? Obviously, there are many indirect benefits like improved communications, better understanding of clients needs, increased level of engagement with clients, getting the message out faster and improve your overall reputation. Some companies use social media as a new channel to market, thereby increasing revenues.
Other companies see the benefits internally by using social media as a way to enhance interaction between employees. This can also be a "controlled" test environment before taking your social media initiatives externally. Fact is that many companies see the immediate benefits in the marketing department.
In his Social Media Marketing Industry report “How marketers Are Using Social Media to Grow
Their Businesses” from March 2009, Michael Stelzner quotes that the number-one benefit of social media marketing is gaining exposure. A significant 81% of all marketers interviewed indicated that their social media efforts have generated exposure for their businesses.
Improving traffic and growing mailing lists was the second major benefit, followed by building new partnerships. An unexpected benefit was a rise in search engine rankings reported by more than half of participants. As search engine rankings improve, so will business exposure, lead generation efforts and a reduction in overall marketing expenses. About one in two marketers found social media generated qualified leads. However, only slightly more than one in three said social media marketing helped close business.
A key marketing benefit of using social media is in relation to reputation. Social media done right will help companies enhance their reputation and therefore will enhance how people relate to their brand. What exactly does this mean? How can social media influence your reputation and how can it have an impact on your brand? To answer this question we first need to have a closer look at the definitions of the terms reputation and brand. Brand and reputation are two sides of the same coin so they are closely related. But they are different concepts. As Richard Branson put it; Build brands not around products but around reputation. A brand conveys expectations of what the company delivers in terms of their product or service. A brand is what the company tells the market about itself and what it wants to be. Coca Cola wants to “Refresh the world… in body, mind and spirit”. Disney wants to “Make people happy”.
Reputation is the other side of the coin. It is what people feel about the company. It is the opinion of the public toward a person or an organisation. It can take years to build a brand, but you can lose your reputation in an instant. A one million pound advertising campaign can be made worthless if your service representatives give a poor service to your customers. Reputation management is the monitoring of how an individual or a company is perceived.
So the two terms go hand in hand. If we are talking about using social media to enhance your reputation it has to be put in the context of your brand. Social Media marketers think of a brand as what other people define it to be and they see reputation as a large component of a perceived brand. Online reputation is based on trust. The more trust an online community has around an individual or company, the more often their content is to be referenced online and the more likely they’ll develop a following. And this is a radical shift in marketing and corporate communications: Companies are no longer in control in defining and shaping their brand. As companies establish themselves online they’re entering a brave new world where online communities are actively taking part in the shaping and definition of their brand. New social media networks like Facebook, LinkedIn or MySpace and social media applications like blogging, micro blogging, forums etc. empower communities and individuals like companies have never seen before: Giving them the power of online conversations and connections, bringing a new dimension to “word of mouth”. Enabling them to influence the way companies build their brand and develop their reputation. I call this Brand Inversion.
Some companies feel exposed because of this and others see this as an opportunity to get closer to their customers. The question social media marketers have to ask is, “Am I willing to let others shape my brand or identity without my input?” More and more companies today don’t want to lose control of their brand so they open themselves up online. They understand that if you interact with others on any level in the online world you involve them in shaping your brand or identity. For some this happens on a greater scale than others, but it is happening. Online communities are increasingly considered the norm for online interaction. The size of these communities is getting bigger and bigger and they simply cannot be ignored. And the tools they are using can make minor discussions become large events.
There is another dimension to this. Social media networks and tools spread perceptions of brand or reputation like wildfire. It gives a new meaning to “Word of Mouth”. This passing of information from person to person has been around for a long time but never really featured on the radar screen of marketing professionals in large organisations. It was more relevant for small companies, particularly operating on a local scale. But nowadays, Word of Mouth is different. The online publishing tools available to people today make the spread of information much easier and faster. Before companies realise, the idea of a perception has become a reality. If numerous people are sharing a feeling towards a company within their online social networks, their friends start to share this feeling in their network and the perception becomes reality at an exponential rate. And furthermore, with Social Media public sentiment is documented, searchable and ubiquitous. What is said today will be available today, tomorrow and 10 years from now.
We can now be more precise in defining the reputational benefits of social media: Perceptions surrounding brand and reputation can now ebb and flow in real-time and require an active and instant participation by individuals and companies. Brand and reputation are key differentiators between you and your competition. It is therefore crucial that brand and reputation are monitored, adjusted (if possible) and guarded as a valuable company asset. This is what social media allows you to do. Using social media to manage your reputation is an effective way to help you build your brand. It’s a useful tool for enhancing both awareness and image. Blogging can help “spread the word” about a company, its products and its services to more people, increasing brand recognition and awareness. Social media can enable companies to gather input and feedback directly from their target audience, and use that intelligence for more effective reputation management. Insight into how people feel about the brand is needed to help change and control audience perceptions and preferences. Because remember, people buy your product because they see the value in your brand. The emergence of social media has put your customers in the driving seat in influencing this value of your brand. You can't ignore this. So you have to engage with them on their "turf", on their social media platforms. Managing your (online) reputation successfully can only happen if you open up your brand and expose yourself. But don't be afraid. Be honest, be open and be yourself.
Author: Marc Campman, Marketing Director, Webjam