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Social Media: The New Competitive Advantage


To Twitter or not to Twitter, that is the question.

Obviously, Shakespeare didn’t write it quite like that. But if he lived in today’s world, he might have. And more important, if he ran a business or had P&L responsibility for a product line, the answer to his question would be an unqualified yes!

Most people see Twitter, Facebook and other social media sites as little more than the latest fad to spring from the Internet. However, astute business leaders have already begun using social media sites as effective communications tools, especially in the areas of branding, marketing and public relations. In particular, smaller companies are finding social media to be very effective in reaching new customers and building awareness for new products and services.

As companies continue to seek newer and better ways to connect with prospects and customers, social media is quickly moving beyond the novelty stage and into the realm of business necessity. Much sooner than you think, social media will become the centerpiece for a variety of mission-critical activities including generating new leads, supporting your sales force, and managing the entire customer interaction process.

According to a recent white paper survey by Josh Gordon of socialmediatoday, four factors are driving this emerging trend.

  • The numbers are reaching critical mass. Initially, many organizations underestimated the number of potential customers using social media. However, thanks to the low cost and easy integration of social media into existing technologies, social media has zoomed past the “early adopter” phase and quickly become mainstream, with millions of daily users.
  • Increased competition for customers. During the recent economic downturn, the customer base shrank in virtually every industry and market. Social media offers cost-effective ways of getting in touch with elusive customers.
  • Change in attitudes. More and more people are beginning to see the potential for social media as a powerful persuasive tool. If judiciously applied social media can help to elect a president (it did), imagine what it can do for your product or service.
  • The old ways aren’t working so well anymore. Traditional lead-generation programs, such as direct mail, print advertising and to some extent even email campaigns, are losing their effectiveness as more and more consumers go online. Social media allows companies to connect with potential customers using their preferred communication methods.

What does this mean for companies going forward?

For starters, social media will be used for a lot more than just creating some online buzz. Companies will need to make social media an integral component of key areas such as branding, information sharing, lead generation, sales support, customer interaction and internal communications. As companies gain experience and new knowledge, they will undoubtedly uncover many more applications.

Companies will also need to develop clear social media policies for their employees. In the survey, only one out of ten companies reported blocking employee access to social media sites. But less than half also had no formal social media policy of any kind. In order to guide behavior and results, companies need to develop clear guidelines for activities such as blogging and employee behavior on social media sites. And remember, when the telephone was first introduced, companies considered stringent policies not allowing employees to use it at work.

Don’t try to block social media or get too caught up in controlling employees. Give employees the parameters, hold them accountable for the results of their roles and get out of the way. Companies that work to strictly limit access are quickly becoming known as “old school cultures” and less desirable employers. And many employees are just accessing what they want from their own Iphones or other devices anyway, so be clear on your expectations about what can be shared and not shared, define ‘good judgment’ in your organization, and hold employees accountable for getting their jobs done.

Staffing for social media will become an issue. Only about 40% of the businesses in the survey reported having employees whose job function included spending time on social media sites. Going forward, companies will need to dedicate more time and manpower to planning and managing these activities. Plus, job descriptions will need to be revised to measure results rather than just the amount of time spent online.

Most of all, using social media effectively will require a coherent strategy. Before spending any money on traditional marketing and advertising, smart companies conduct a thorough assessment of which publications their customers read, where they live and shop, and how they like to receive information. Social media will require a similar approach. Specifically, business leaders will need to determine which social media sites their customers prefer and which networks/tools are most appropriate for their customer base.

You may not care what Shaq O’Neil had for breakfast or what book Ashton Kutcher is reading while he waits for his next flight or even what city and what work I am doing. But don’t make the mistake of thinking that’s what social media is all about. Sooner than you think (and perhaps already for some), social media will provide a real competitive advantage for companies who know how to use it and have linked it to their strategic plan.

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