When it comes to attitudes toward social media, companies fall along points of a spectrum. At one end are those who refuse to participate, even despite the myriad benefits social media can bring, as well those who participate minimally, if grudgingly. Often the latter recognize that, in today’s connected world, they cannot afford to ignore social media (Dutta, 2010). Where once negative comments or reviews about a company or its products and services were confined to survey or comment cards, letters, and telephone calls, social media empowers individuals to spread their stories widely. It provides them with an open forum for airing grievances that can damage company reputations quickly, and executives are realizing that it is important to have, at the very least, a social media listening program and a crisis plan and strategy in place (Blanchard, 2011; Dutta, 2010).
Many companies have moved past these minimums and are becoming more sophisticated in using social media, such as establishing multiple accounts on a variety of social media sites and using them in a targeted way to speak more effectively with different clusters of customers (Burson-Marsteller, 2012). At the same time, however, studies show that the number of companies that have truly moved past social media adoption and into social media integration remains low (Smorgon, 2012).
A benefit of integrating social media into an organization to the point that the company can be considered a social business is increased dialogue and connection with customers (Chandra, 2012; Sawhney, Verona, & Prandelli, 2005). By establishing forums or sites that allow customers to participate in—or even drive—conversations about the company and its products gives businesses unprecedented levels of access to feedback from the people actually using the products (Sawhney, Verona, & Prandelli, 2005). As Piche (2011) mentioned, by listening to end-users, a company can reduce development costs because developers gain a deeper understanding of consumer needs. Likewise, having robust support communities where customers can assist each other with questions and problems can alleviate the burden on customer service or help desk departments.
At the very end of the spectrum of social businesses are those that tap into the power of the crowd and engage in co-creation with customers or individuals outside of the company. Eli Lilly’s InnoCentive site is one example. Sawhney, Verona, & Prandelli (2005) describe InnoCentive as “a Web-based market where solutions to problems are traded and participation is enhanced through competitive problem solving” (p.10). Anyone within the InnoCentive network can propose solutions to the problems listed there; the site’s chief scientific officer estimates that “more than 30 percent of the problems posted on the site have been cracked, which is 30 percent more than would have been solved using a traditional, in-house approach” (Howe, 2006). Crowdsourcing and co-creation work because they tap into the diversity of knowledge that exists around us. There is no known limit on the well of human creativity (Howe, 2006).
Blanchard, O. (2011). Social media ROI. Indianapolis: Que.
Burson-Marsteller. (2012, February). Burson-Marsteller’s global social media check-up 2012. Retrieved from http://www.burson-marsteller.com/social/infographic.aspx
Chandra, M. (2012, November). Strategic management of social media: Session 9. INFX 598. Lecture conducted from University of Washington, Seattle, WA.
Dutta, S. (2010, November). What’s your personal social media strategy? Harvard Business Review, pp. 127-130.
Howe, J. (2006, June). The rise of crowdsourcing. Wired. Retrieved from http://www.wired.com/wired/archive/14.06/crowds_pr.html
Piche, G. (2011, August 9). The Clorox Company. BlogWell. Retrieved from http://www.slideshare.net/socialmediaorg/blogwell-seattle-case-study-the-clorox-company-presented-by-greg-piche
Sawhney, M., Verona, G., & Prandelli, E. (2005, August 23). Collaborating to create: The internet as a platform for customer engagement in product innovation. Journal of Interactive Marketing, 19(4), 1-14.
Smorgon, M. (2012, February 7). Social business: Social media integration. Social Media Max. Retrieved from http://www.socialmedia-max.com/2012/02/social-business-social-media-integration-infographic-robingrant/