Social Network Marketing & Its Effectiveness

Topics: Marketing, Word of mouth, Social network service Pages: 8 (1945 words) Published: April 21, 2013

The objective of this review is to explore what the research says about social network marketing and its effectiveness.

The first wave of internet revolution (web 1.0) brought consumers e-commerce. The second wave, Web 2.0 evolved into a much robust and interactive experience, allowing consumers to participate and share information effectively, Social network media such as Facebook, Tweeters, etc. have grown rapidly. Users are not only teens but also adults. The popularity of smartphones, hand-held tablet computers, computer notebooks also help the increase in popularity of using these sites. For instance, social net work media have replaced e-mails to become the most popular communication tools.

To marketing practitioners, this wave of digital revolution cannot be ignored. More than that Web 2.0 enable consumers to generate content and share. This change is totally different from conventional marketing, in which firms generate content or messages to bombard users and potential users (such as advertising). It is now not a question of whether a company should use digital media, but how they can maximize the benefit from the rise of these new media network. It may not mean that conventional marketing tools such as advertising will be replaced overnight, but social network media should be able to synergize conventional promotional tools. Thus, naturally the question of tracking and measuring social network media and its ROI will be asked, which will be addressed in this paper.

The use of social network media in consumer marketing is well established. Its application in education, healthcare, and also in pharmaceutical promotion are also explored.

Word of Mouth Marketing

To begin with, the concept of word of mouth marketing is explored. Marketers recognized that the conversations among customers are powerful influence of product adoptions (Ryan and Gross 1943; Rogers 1962).

Traditionally, marketers develop message to influence selective consumers (who may be early users) and these consumers help propagate the product message to other consumers. More sophisticated marketers will identify influencers in the group of potential consumers (or opinion leaders) and influence them. Thereafter, these opinion leaders can help propagate marketers' message to other consumers.

In web 2.0 err, consumers will participate in the whole marketing communication process. They will coproduce content to be shared in their chosen network. Hence, Word of Mouth model has evolved from a consumer-to-consumer process in the past to a opinion leader to consumer model, and most recently, a network coproduction model (Figure 1.) Marketers do not only influence the selective consumers (opinion leaders) in the launch phase, but also have to monitor the process of consumer to consumer messaging.

The coproduction model of word of mouth marketing is further depicted by Adrian Palmer and Nicole Koenig-Lewis. In their article "An experiential, social network-based approach to direct marketing", the authors proposed a framework of 3 elements of the social network environment - the seller, the customer and the community (Figure 2).

In this model, the traditional interface for direct marketings has been between the seller and the customers, represented by the hatched area. With the introduction of the community element, the customer interacts with self-selected communities. Sellers need to interact with selected communities to achieve a variety of benefits, including spreading of positive word of mouth and gathering information about buyers' needs and preferences. The challenge is how to balance the interest of the sellers, the customers and the community, and this is represented in the overlapping area of the 3 circles. Figure 2. Direct marketing in a social network

Success Factors for Social Network Sites

Shu-Chuan Chu and Yoojung Kim studied the...
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