The internet technologies have made dramatic impacts on the traditional marketing activities over the past decade. Especially, the boom of social media technologies such as Facebook, Twitter, blogs and so on in recent years, which are fundamentally revolutionizing the ways in which people socialise and exchange information on a daily basis. The YouTube video clip “Gangnam Style” by South Korean singer, Park Jae-sang (2012) generated millions of views and made him a worldwide superstar overnight, which essentially proves that the power of social media cannot be underestimated in today’s world.
The topic of how to take advantages of the social media channels when creating marketing strategies have been extensive studied by marketers and the academic communities. This essay will examine the pros and cons of social media in the context of marketing strategy in the current rapidly changing business environment. In addition, the effects it has on the traditional marketing activities will be analysed. Role of Social Media
It is widely recognised that social media plays a significant role in the construction of marketing strategy for modern businesses. It offers a fast and innovative channel for the distribution of marketing messages on a global basis, and mostly importantly, with minimum cost. Kaplan and Haenlein (2010, p. 62) defined social media as “social media is a group of Internet-based applications that build on the ideological and technological foundations of Web 2. 0, and that allow the creation and exchange of User Generated Content”.
As the definition suggests that the content, in other words, the actual meaningful marketing messages are no longer well designed promotion campaigns created by the firms but that generated by the users, the consumers based on their understanding and experience with the brand. One of the most influential factors relating to brand building is to understand the customers’ minds (De Chernatony L. & McDonald M. , 2003). It is argued that marketing strategy has been greatly hifted from product centric to customer centric, which is proven to be especially effective on the long term basis. The pervasive nature of social media enables consumers to share and exchange their authentic and original opinions without the boundaries of distance and availability. For instance, the foundation of Facebook is mainly focused on information sharing as well as features built specifically to enhance its reachability. On the other hand, companies also benefit greatly of this pervasiveness.
Social media allows the collection of instantaneous customer feedbacks and customer insights. One of the objectives of marketing strategy is to establish a social bond with the targeted customers, encouraging them to participate as much as possible in the marketing activities in order to expand their customer base and eventually build customer loyalty towards the brand. Consequently, the various social media portals provide the businesses a very cost efficient way to stay linked with their consumers.
In addition, the positive comments and postings of the brand can be leveraged as a more persuasive and honest marketing messages relative to their own advertising oriented ones. Since the rapid and widespread development of social media technologies, diverse range of social media forms have been emerged and can be adopted by marketers in many different manners. As a matter of fact, all of the Advertising Age Top 100 Advertisers have created Facebook pages for their brands (Lipsman et al. , 2012). A well designed video campaign can be placed on Youtube to raise customer awareness.
In the case of long established and well-known brands, it can be considered as an innovative means to keep their customers informed and delivering the message that we are doing well and continuously exploring the state-of-art technologies. A relatively traditional blog page is a great way to construct meaningful and high quality advertising oriented messages to introduce companies’ background knowledge and alleviate customer acquisition. And most influential of them all, the interactive forms like Facebook and Twitter can be utilised as a platform to engage customers in active conversations with the brand.
Due to the grouping of users with mutual backgrounds as well as general interests, a liked or shared content among friends would attract more and more people to join the conversation. Therefore, companies would be able to gain insights into how the brand is perceived in the targeted customers’ minds. Benefits of Social Media To start with, social media channels greatly amplify the effect of word of mouth (WOM) marketing. Unlike traditional advertising campaigns, WOM communications are generated purely based on the customer experiences as opposed to being paid to promote a particular brand.
Therefore, when it comes to make purchase decisions on an unfamiliar brand, the suggestions by a close friend who is likely to share the same interests become a reliable and convincing source of reference (Cheema and Kaikati, 2010). Gershoff and Johar (2006) states that consumers frequently depend on others for purchasing opinions of intended products, especially those with great financial and psychic risk. Several studies (Godes & Mayzlin, 2004; Trusov et al. , 2009; Herr et al. , 1991) have illustrated that WOM communications are more effective and efficient than the traditional marketing channels.
Social media provides the modern platform for facilitating WOM communications. Consumers’ perceptions are spread at an exponential speed towards targeted and potential customers with worldwide availability. The comments on a company’s Facebook page can be reviewed so as to understand its reputation and brand image in the public eyes. Similarly, forums like boards. ie in Ireland provide a convenient channel for gathering opinions on a particular product or service for both consumers and firms.
Since replies are posted by people who are not known to the viewer on a personal basis, they are able to make decisions based on the others subjective perceptions from an objective point of view. Hence, social media channels are regarded as the ideal candidates for newly introduced marketing techniques such as viral marketing and so forth. Castronovo, Cristina and Lei Huang (2012) proposed a social media marketing model that combines a variety of social media forms with some well-accepted online marketing strategies like search engine optimization to generate a positive buzz for a company.
The model is derived from the WOM strategy and concentrated on creating a positive message for the company and subsequently propagating the message among targeted market. It is believed that social media contributes significantly with respect to building brand awareness, raising sales and building customer loyalty by acting as a pervasive hub with infinite number of participants. Second of all social media forms offer constant connection to potentially infinite number of audience. Figure 1 shows the increasing number of visitors recorded in the year from 2007 to 2011.
It can be seen that the number of Facebook fans have been increased dramatically over the past few years as it gains its popularity. Figure 1 Trend in U. S. Unique visitors (000) to Facebook, Myspace and Twitter On the contrary, traditional marketing channels suffer from limited customer reachability. Media like television and newspaper advertising are mainly targeted to people with the habit of watching and reading them. And mostly importantly, the effectiveness of those means is proportional to the investments allocated in companies’ marketing budget.
Money is what puts your advertising on a highly read section or broadcasts it on the golden hours of a popular channel. Moreover, the competitors are always willing to pay more when they have the financial ability. The cost factor becomes even more crucial to small and medium sized enterprises in comparison to large corporations. Since they are not able to afford the expensive traditional marketing channels, social media is the perfect place to start building their customer awareness and draw customers to their products or services.
Although small and medium enterprises normally have specifically targeted customers on a local basis, they can still take advantage of social media to assist their future expansion. Lipsman et al. , (2012) used Facebook as a case analysis to examine the exposure and propagation of the different forms of branded content on the social networking site. It confirms the dramatic speed at which the branded content spread among users and the potential infinite fan base based on solid statistics in the US. This research focused on better understanding the customer profiles and targeted audience segments rather than the product oriented approach.
The statistics studied in the research justifies that the approach with emphasis on reach and frequency within the audience types results in a much more effective and efficient marketing strategy in terms of delivering the marketing messages to the relevant customer segments. Downsides of Social Media The downsides of social media are caused by the same intrinsic pervasiveness that generates their advantages. Social media is also the fastest way for a leaked piece of sensitive information to reach infinite audience globally.
Since the very fundamental component of social media is people, when an irresponsible or unprofessional employee share or expose confidential knowledge of the company or even just too much information would make devastating effects on the company’s reputation, which was built over many years as well as millions of dollars using traditional marketing strategies. When the fashion designer Kenneth Cole (2011) tweeted “Millions are in uproar in #Cairo. Rumor is they heard our new spring collection is now available online at [Kenneth Cole’s website]”. This reference to the 2011 Egyptian Revolution was extensively protested on the internet.
Kenneth ended up removing the offensive tweet and had to post an official apology on his Facebook to ease the controversy. The irony is he had to turn to the same social media that put him in this awkward position in the first place to save the day. When the Link Real Estate Investment Trust set up a Facebook page to promote old-style restaurants, the page was flooded by furious comments criticising that many restaurants and stores were forced out of business by them. As a result, the advertising campaign had to be aborted and again the brand image was dramatically damaged.
Conclusion This paper discussed the wide range of advantages that social media can offer to marketers compared the traditional channels. As the various type of internet media are gradually replacing the traditional advertising techniques, it can be anticipated that social media would become a more and more preferable marketing tool for the marketer. However, a properly designed marketing strategy that corresponds to the native characteristics of social media is still essential so as to fully benefit from those ubiquitous and innovative channels.
As arguments proposed by Barwise and Meehan (2010: 80), the same set of fundamental rules for brand building still apply and must be followed regardless of the underlying marketing environment. The power of customers or fans always has both positive and negative effects on marketing strategy using social media. In fact, a negative comment or opinion on a brand is more resilient to stick in the world of the internet than many accumulated supports. Sometimes, all it takes is a negative feedback to damage an eBay seller’s reputation that took them years to maintain.
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