Effects Social Media Has on Business

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The Effects Social Media Has On Business
Communicating in the 21st Century
July 30, 2011


A lot of research has been done over the last few years to prophesize social media as a new form of customer-centric relationship building. Building a network or using social media to deepen customer intimacy has become the norm of today. However, what is often overlooked is the impact of social media to change behaviors, and the potential to use social media to impact a professional’s decision-making processes. This article discusses the effects social media has on business, its advantages and disadvantages. Social media can affect business’s marketing, communications, reviews, transactions, day to day operations, and other business aspects. What is social media? The first part of the term, social, refers to the instinctual needs humans have to connect with other humans. Humans have a need to be around and included in groups of similar like-minded people with whom they can feel at home and comfortable sharing thoughts, ideas, and experiences (Safko, 2010, p. 4). The second part of that term refers to the media used to make those connections with other humans. Whether they are drums, bells, the written word, the telegraph, the telephone, radio, television, e-mail, web sites, photographs, audio, video, mobile phones, or text messaging, media are the technologies used to make connections (Safko, 2010, p. 4).

The application of the terminology social media is about how technologies effectively to reach out and connect humans, create relationships, and build trust. In business those relationships are ready to aid in a purchase of a product. Social media is a new set of tools and a new technology that allows business to efficiently connect and build relationships with customers and prospects. Social media is doing what the telephone, direct mail, print advertising, radio, television, and billboards did in the past (Safko, 2010, p. 5). Social media is the use of web-based and mobile technologies to turn communication into interactive dialogue. Simply put, social media is an open media for interactive communication led by normal people. Unlike the one-way production and transfer of news, information, and entertainment from main media outlets via the mass media, social media allows anyone to become a producer of such content, and deliver it through interactive communication in the form of a pyramid, based on relationships (Dong-Hun, 2010, p. 113).

Social media includes various methods such as social networking, user-sponsored blogs, multimedia sites, company-sponsored websites, collaborative websites, podcasts, etc. Social media is the media that is published, created and shared by individuals on the internet, such as blogs, images, video and more, as well as online tools and platforms that allow internet users to collaborate on content, share insights and experiences, and connect for business or pleasure (Chung & Austria, 2010).

Social media provides a virtual network place where people can enjoy expressing their opinions, exchange opinions, disseminate and control messages anywhere anytime. Marketers are now able to reach consumers and interact with them using social media. Previous studies have found that consumers tend to trust more user-generated messages, such as peer recommendations or consumer reviews, on social media than messages from traditional mass media. Consumers’ comments about a product on social media produce a negative or positive brand buzz and the virtual messages affect consumer purchasing decisions. Social media is an inevitable channel for customer support (Chung & Austria, 2010). Word-of-mouth promotion and marketing strategies are increasingly being studied and employed as traditional forms and avenues of marketing lose their audience and effectiveness. In 2006, it was believed that the average American was exposed to 5,000 ads a day, and that number has only continued to grow (Wright, Khanfar,...
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