LEADING THE WAY
No business can deny the power of social media. Social networking has emerged as the dominant cultural phenomenon of the digital era. It's not about businesses selling products, promoting the company message or sending out data over a one-way communication channel. Consumers are in charge, talking about those businesses _ and their products, services, employees, performances and reputations _ across social networks in billions of chats, blogs and emails.
Social media are changing the way people work, shop, receive services and communicate with each other. We are in the midst of a major change in the way that businesses and customers interact, whether our customers are consumers or other businesses, internal or external. It's a change enabled by technology, but not fundamentally about technology. It's about having conversations with customers. These conversations are partially or wholly public, requiring a new culture of transparency.
Recognising the importance of this trend, PricewaterhouseCoopers (PwC) has gathered the thoughts of CEOs from around the world over the past several years (PwC's annual global CEO survey). CEOs expect that social media and mobile devices will prompt a "significant change" in companies' strategies to engage customers, as customers turn to social media to voice their preferences.
The term "social media" refers to the use of mobile and web-based technologies to turn one-way communication into an interactive dialogue. Social media are flourishing. Leading companies know that participation is no longer an option but a requirement. To ensure success, entry into social media must be a strategic decision. It requires adequate planning, resources and support.
There are three fundamental shifts that not only provide ways to create value, but also put a whole new set of pressure on businesses:
- Customer expectations have shifted because of their personal experiences with social networks. They are now expecting companies to be more open to suggestions, responsive, engaged, transparent and willing to solve problems.
For example, an Australian bank launched a marketing campaign. It sent a tweet that appeared to be a mistake by a junior community manager. It was in fact part of an integrated social media and traditional marketing strategy to get people to break with their current bank and to create buzz about the new competitive pricing across a range of banking products that the bank was offering. Across social networks, the Twitter campaign created 66% of all banking conversations online. In three weeks the bank had a 20% increase in transaction accounts, a 50% jump in credit card applications, a 35% gain in mortgage inquiries and a 45% hike in mortgage refinancing applications.
- Employee expectations (particularly among the younger generations) have also shifted because of personal expectations developed outside of work. They now expect more transparency, openness, engagement, an ability to provide input and a role in the decision-making of a flatter organisation.
For example, a multinational food company has used social media tools in its employee communication programme and encouraged employees to connect, share content, offer ideas, ask questions and solve problems. Implementing internal social systems could raise the productivity of knowledge workers by at least 20%.
- Capabilities to co-create solutions in markets have shifted, and you are now able to take problems and apply thinking from a much larger group of stakeholders in the process of innovating and inventing new products, services and solutions. The ability to co-create content, service offerings or even products _ with customers, employees or business partners _ offers huge potential for business. You don't need to be the one to do the research or create the innovation in order to benefit from it, as long as the ideas are freely given.
In Britain, an insurance company has received great engagement from customers who actively shared their ideas on Facebook for the development of a new iPhone app.
If you're a company that's ready to embrace social media, the very first step is to define your Social Media Objectives and ensure alignment with your business strategy. Successful organisations develop a social media strategy, structure and governance, IT infrastructure and management transition to address the above three fundamental shifts.
Here are six spectacular reasons your company should use social media:
- Social media channels can enhance and protect your corporate brand.
- Social media can expand your reach to new customers at a lower cost than traditional advertising media.
- Social media can be crucial in responding to public relations and customer service issues.
- Social media has the potential to set your business apart from your competitors.
- Social media are a great way to showcase your philanthropic initiatives and corporate culture.
- Social media can help you attract and retain top talent.
Social media offer companies the opportunity to connect with their customers, and can also play a leading role in driving business. Satisfied consumers, as well as your employees, suppliers, partners and even investors turn into champions of your company's brand. Moreover, the cost is low. Most importantly, social media is no longer considered an emerging technology _ it has arrived and is here to stay.
Pirata Phakdeesattayaphong is an Associate Director in Consulting Services for PwC Thailand. For more information, contact firstname.lastname@example.org
About the author
- Writer: PricewaterhouseCoopers Â