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Introduction: In the early 1990s, internet was the buzzword. Its promise was heralded as ground breaking. Some entrepreneurs exploited the new opportunities it presented to create new businesses, transformed old industries, and also to destroy old businesses (laudon & Traver, 2010). There is no doubt that no company out there today would like to be the next Circuit City, or Borders. These are some of the companies that failed to adapt to the internet and web technology and were swept away by competition. Similarly, no company would like to be the next dot.com business. These are businesses that sprung up in the wake of internet euphoria without sound business fundamental and only hype to go by. They were short lived. Instead most traditional businesses would like to be like Walmart, Dell computer and more. These are companies that recognized the changing trends in their industry and transformed their business to compete. And new businesses would like to be the next Amazon, Google, Facebook or Twitter. These are some new businesses that emerged in the new internet environment.
One thing businesses are known for is planning for the future by developing strategies that carefully align their activities with their goals. Most organizations’ goal is to make profit. Making profit in the internet age of intense competition and democratized information can be difficult. Product differentiation becomes hard to do, and information asymmetry has been nullified. This leaves organizations seeking new ways to create competitive advantage in order to further their profit motives. Traditionally, businesses turn to technologies to improve business processes to create efficiencies, cut cost and derive profit. As much as the internet has caused disruptions in many industries, those that recognized its potential and successfully exploited it were able to strengthen their position in the marketplace. And we know the plight of those organizations such as Blockbuster that were unable to identify the potential- Netflix emerged in its place.
It seems like yesterday that internet was the buzzword. With the benefit of hindsight, internet has lived up to some of the hypes and not so much in some aspects. The internet and web technologies at the hearth of internet phenomenon are widely observed by experts to be continuously evolving at an accelerated rate. One of these internet evolutions is the emergence of social media and the buzzword of the day has shifted to social media. Most business experts expect the pace of change in social media popularity to accelerate in the next decade. In the light of developments in social media and its capabilities, business visionaries are asking what does the future holds for businesses in this new environment.
Study shows that businesses must develop social media strategy in order to survive long term because social media touches every part of an organization from marketing, customer service, sales and product development.
Just like the outset of the internet revolution, many predictions have been proffered. The purpose of this research is to investigate why having a social media strategy is imperative for the long term survival of organizations. More specifically, this paper aim to determine social media solution for businesses in marketing, sales, customer service, and new product development. To accomplish this, this investigation reviewed latest social media literature including websites, books, magazines and articles.
The question of why social media is imperative for business survival was best addressed by the following findings: We are in the social customer era (Greenberg, 2010) that spells the “end of business as usual and businesses must rewire the way they work in order to succeed” (Solis, 2012). No company can avoid social media and those that do will fail (Holloman, 2012).
When you take these findings from Greenberg, Salis and Holloman together, they seem to be speaking to the fact that social media has become the dominant method of using the Internet, and it is profoundly changing the way millions of people interact, and communicate. Social networking in particular has become extremely popular, with over one billion users on Facebook alone and billions more accounts across thousands of social networking sites (Golbeck, 2013). This growth of social media popularity is observed to be taking place across all demographics- leading some to concluded that social media is now mainstream. Greenberg’s claim that we are in a social customer era can be understood when we recognized how much power the customer now has due to internet communication and social networking. The customer is now connected to network of friends and families with the capability to create content, share and interact with one another. This customer’s connections to networks of their friend (an audience of audience) coupled with their ability and readiness to mobilize or be mobilized for action at the speed of internet are what Solis attributed for his bold claim that business as usual has ended. Also, the following statement from Mark Zurkerberg (founder of Facebook) “There’s going to be an opportunity over the next five years or so to pick any industry and rethink it in a social way … we think that every industry is going to be fundamentally re-thought and designed around people” was credited to (Shiels, 2010) by Holloman. He further explained that demand for businesses to rethink their ways of doing business is people driven. They want change because inherently people are social creature. And their new love affair with social media is feeding (customers, employees, and partners) increasing demand for social interaction from the companies. Amongst the changes in the customer’s behavior on social media they noted are: the demand for engagement and interaction with organization on a human level, on their terms, and on their turf. They want honesty not crafted corporate messaging. In today’s environment, the customers’ turf is increasingly on third parties’ network outside of organization’s control. Others have also noted that the customer’s decision making space has become crowded. It is no longer the traditional view of the customer marching down the linear decision making funnel as Divol, Edelman and Sarrazin (2012) observed . Instead the social customer decision making journey has been observed to be filled with loops throughout the purchasing journey.
It appears that most businesses have come to the realization that social media has caused fundamental changes in customer behavior to the extent that the traditional ways of reaching and transacting with them will no longer suffice. This was articulated by Holloman with the statement that “The tone is now being set for businesses by their customers, staff and business partners – and companies must adapt. More critically, they must participate”. The challenge for most businesses as studies indicated is how to best harness the potent power of social media to drive their business process for competitive advantage. It is not enough to jump into the social media bandwagon. Companies that did that without clearly defined strategies have failed. The complexity of measuring returns on social media investment is shown to be hampering executive supports for such initiatives. On this note executives are being encouraged to rethink the measurement of return on their social media initiatives and be bold in making the transition to a social business with social media strategies. Carter (2012) noted that transitioning into a social business represents change which could be very disruptive. However, pointing to the potential to exploit this new media for business gains, she urged businesses to get bold in confronting this transition.
It is easy to surmise from all this experts that they all seem to be saying that the future of business is through social media. That being the case, businesses has no choice but to participate for the sake of their future. Like all good businesses, planning for the future is advised to best be approached with sound strategy. Laudon and Traver (2010) defined business strategy as “the set of plans for achieving superior long-term returns on capital invested in a business firm”.
With the case being that social media can be harnessed to drive results in all business processes, and the importance of approaching this with sound business strategy, it implies that an organization that wishes to deploy social media for marketing, sales, customer service, and new product development/innovation must articulate their strategies around each of these processes.