During a number of Internet Technology shows I attended in 2009, I had several fellow attendees questionining the relevance of social networking to the average business. Most people are now familiar with MySpace, LinkedIn and Facebook, but fail to see what companies could gain from having their very own social network set up on their website.
I explained it as follows - all businesses have some form of customer database or CRM system. The old fashioned customer databases are typically 20% out of date at any given time, and require admin staff to contact customers for updates - which can of course be difficult when said customers have moved address and changed contact details.
By having a Social Network on your website - you encourage customers to register their contact details with you themselves. Then you use competitions and special offers to incentivise your customers to keep their account details up-to-date.
With a Social Network, you get to follow all your customers’ dialogues about you and your offerings - giving you invaluable access to first-hand market research. Over time, you will be able to accurately gauge consumer behaviour, spot key trends and key customers and target accordingly.
With a system like the Affino (see Social Commerce Overview) - with its numerous analytics Dashboards, you now have a dynamic customer database - one which you can dip into at any time to observe real-time customer interactions and transactions. The onus of keeping the database up-to-date falls more on the customer than your admin staff, which means you can spend more time on marketing to your database than on maintaining it.
There are of course numerous other reasons for having a Social Network - brand advocacy, viral marketing, sales reinforcement; and this is certainly the smart way to manage your customer database in today’s business climate.
A recent article in Internet Retailing claims that 90% of ecommerce sites are looking to introduce some form of community within the next year or two. This often just means comments & ratings, but several sites - including Amazon and ASOS have seen the benefits that can be gained from giving its customers a platform to interact on and influence each other.
Never forget that word-of-mouth recommendations and endorsements are still the strongest form of promotion, and with your own Social Network, brand advocates will emerge to serve your business. Moreover, for any vendor / customer relationship, it is imperative that a business owns and controls the relationship it has with its customers. You may use MySpace, Flickr, Facebook, LinkedIn and their ilk, but when you do so - it is those sites which own the customer relationship as well as whatever content you have uploaded to them. To fully own your customer relationship, the only way is to have your customers plug directly into you - which means running your own Social Network for those customers ...
