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Is Social Networking an Asset or Liability for Your Company?

By Louis Columbus CRM Buyer ECT News Network
Sep 2, 2008 4:00 AM PT

It's not a question of whether social networking will influence your company, customers, employees, suppliers and others, it's a matter of when. If you haven't committed to learn more about this area, it's time.

Is Social Networking an Asset or Liability for Your Company?

Deciding if social networking is going to be an asset or liability is dependent on how your company chooses to approach it.

Companies who look first to their communications objectives and selectively choose which aspects of social networking can accentuate their messaging are the most successful.

Those that choose to look on social networking as a means to blanketing the connected world with their messaging fail.

Whether social networking is going to be an asset or liability depends on your decisions of how to use it.

Starting With Web 2.0

The idea of the Internet being more responsive and participatory is one of the aspects of Web 2.0, a concept defined by Tim O'Reilly and Dale Dougherty of O'Reilly Media.

One of the best books written about the adoption of Web 2.0 and the rapid growth and popularity of social networking sites is Groundswell by Charlene Li and Josh Bernoff, from Forrester Research.

Josh Bernoff writes the Groundswell blog as well.

Subscribing to it gives an excellent education on how social networking is changing how companies are adopting these technologies.

After reading their book, I put together a short table to explain the different aspects of social networking, and it is presented here.

Application Description
Blogs Comprised of short articles or comments posted via blog writing applications; typically supports integration of text, photo, video and audio (podcasts). Strengths of this application are the depth of analysis and opinion you can deliver; the development of more complex ideas and use of graphics and video to explain ideas.
Mashups A mashup brings together multiple sources of data and creates a single application, often created as a Web service. Awards are in fact given for the best mashups.
Really Simple Syndication (RSS) An approach to syndicating content from Web sites, blogs and social networking sites that relies on a feed-based technology that allows content to be read in RSS readers. This is a must-have for any company Web site or blog as it allows people to track current news via their RSS Feeds.
Social Media This is a very broad area that has as its catalyst the fruition of Web 2.0 concepts into products. It includes Web sites for sharing video such as YouTube, sharing photos (Flickr) and also blogs, Wikis and podcasts.
Social Networking This is the most rapidly expanding area of the Web today and includes sites that enable users to create their own online communities. LinkedIn is one of the most well-known business sites and is often used by recruiters looking for new hires. Facebook, according to CEO Mark Zuckerberg, has grown from 24 million users on May 24 to 70 million in late July, stated at a recent developer's conference. Also included in this group is Twitter, FriendFeed and others. Twitter has initiated the debate of what microblogging is or isn't, so be sure to stay tuned into that site specifically. Be sure to visit Compete and check out the traffic of the sites listed in this section, you can get a sense of how rapidly social networking is growing.
Tagging Simplistic technology that gives users the flexibility of bookmarking the specific pages and sites of interest; basis of the approaches used by Digg and del.icio.us for reporting popularity of specific blog posts and Web pages.
Wikis A collection of Web pages that allow anyone to add or edit content. IBM, Microsoft and others have extensive internal Wikis that act as their content management systems. Wikis are useful for also nurturing collaboration of specific projects.
Source: Groundswell

First Lessons Learned

Companies getting the best results have a very clear idea of what their communications objectives are before ever attempting anything with social networking. Getting those goals defined first makes participating and contributing all the more productive and valuable. Far from complete, here are lessons learned so far from working to understand how social networking can be an asset for a company:

  • Realize that social networking is changing how your customers want to communicate with you. This point is very well made on one of my favorite blogs, Church of the Customer. The post How companies connect using Twitter, is must-reading as you get going with a social networking plan. Maybe your customers DON'T want to get a telephone call or direct mail; maybe they want to communicate over Twitter, FriendFeed or any other number of social networking sites. It's time to realize that customers are drastically changing how they want to communicate. It is also up to every company to stay up with this change.
  • Define your company by solving customer dilemmas and listening, not just selling. This is the biggest philosophical leap many companies need to make. Social networking is more about offering up knowledge and insight that solves problems and helps customers first. It's not about starting a sales cycle, it's about building a brand that is respected for stepping up to solve customers' unmet needs and problems first. Get a Twitter account and check out Southwest Airlines (@SouthwestAir) -- at last count they have over 800 updates. This is a real commitment to transforming how they interact with their customers. Also check out Marriott (@Marriott) and the start of Delta Airlines' efforts (@DeltaAir).
  • Definitely check out how your company is viewed online. There are a multitude of services to do this and many Web sites as well. Just to get an early sense of how your company is being talked about on Twitter go to TweetScan for example. There are also RSS Feeds you can put into place to track your company being mentioned on each social networking site as well. Companies including Cymfony can track your company's mentions and provide you with analytics as well.
  • Be real, warts and all. I am far from an expert, yet what is immediately clear is that for any company, or individual for that matter, to be taken seriously in any social networking context they have to be real, warts and all. If your company has a problem and someone on a social networking site finds it, it's best to own up and deal with it. This is a medium that brings the essence of marketing to it; it is immediate, clear and blunt. Just as a learning observer, this point comes out loud and clear.

Bottom line: Start getting an education in social networking by signing on to these sites and observe what is going on and then take a hard look at your communications goals and see how your company can contribute to solving problems and meeting needs first. Get an account going on Facebook and Twitter and explore their features, as each is a powerful tool for first getting a great education on these new technologies, and second, how to better connect with and serve your customers.


Louis Columbus is a Senior Manager, Enterprise Systems at Cincom Systems and a former senior analyst with AMR Research. He has worked with enterprise clients on defining solutions to their channel management, order management and service lifecycle management strategies. He also teaches graduate-level international business and marketing courses at Webster-Loyola Marymount University and University of California, Irvine. He is the author of 15 books on technology and two books on analyst relations. His book, Getting Results from your Analyst Relations Strategies, can be downloaded for free. You can contact Louis on Twitter at @LouisColumbus.


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What best sums up your attitude toward Facebook?
It's a wonderful communications tool if used responsibly.
It has way too much power for any one company.
It does a lot of good beyond connecting people.
It has changed the world for the worse.
Can't live with it, can't live without it.
I don't have time for it.
I have no interest in it.