VENTURE PERSPECTIVES. Social Networking for Business Growth

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1 VENTURE PERSPECTIVES Social Networking for Business Growth Venture Perspectives CoVergence, LLC 2014 is a series of advisory papers written for those who are starting a new venture, growing their venture, or having to deal with shifting ( pivoting ) the focus of their business. Each Venture Perspective includes stories from a serial Venturer, research of industry advisors and experts and tools and templates to aid in the startup, growth and pivoting stages of small businesses. Do not copy without prior written consent.

2 INTRODUCTION Like. Tweet. Share. Friend. Favorite. Knowing what these terms mean online proves that social networking has become part of life for you and for those around you. It s no longer a new way to connect with the people you know it s a common way to connect. It can be fun, educational and informative on many levels. Today social networking has entered the business world and its opening up new opportunities for those who know how to use it. Social networking growth has been fueled by the increased mobility of the Internet. It s instantaneous, direct and once you get the hang of it, it s easy to do. The concept was originally designed to study how individuals interact, to determine patterns and relationships between groups. Social networking has been used to study the spread of diseases, transportation, financial information and more. For businesses, the study of social networks has been used to determine how links influence individuals. For smaller, closed-networks, individuals are assumed to share similar beliefs, patterns and habits. For larger, open networks, individuals are more diverse, as the ties and connections are weaker, thereby introducing new ideas, concepts, and opportunities more frequently than smaller social networks. What social media has evolved into is a tool, one that happens to fill several business needs. It influences, promotes interaction and fosters new relationships online. Social networking has, in effect, revolutionized business communication. Venture Perspectives 1 Copyright 2014, CoVergence, LLC

3 THE IMPACT ON BUSINESS Approaching social networking can be simple or it can grow as much as you want it too. The energy you put into it equals what you get out of it. Today, there are social media strategists and experts who are hired to assist businesses in reaping the untapped consumer and influence base the Internet holds. Small businesses that are just starting need to get familiar with the world of social media first before planning a sound strategy. Before you start that strategy your company needs one very important thing - a website. Make sure it s professional and sends the message you want it too. It will be your digital home base that your customers and business partners will connect to as a result of seeing your business name on other social networking sites. While your great new web site is important it truly isn t enough these days. That s when you move onto the next step and set up accounts on the social media networking sites best suited for your business. Having accounts on Facebook, Twitter, Google+, LinkedIn and other networks pays off. How? They add increased visibility and credibility. Think about the research you might do when you want to visit a recommended restaurant but feel skeptical. You may want to take a look at its website and peruse the menu. Perhaps you want to check what kind of reviews it received or read up on any media coverage. Finding that restaurant within social media sites informs you and therefore adds to its legitimacy. That very same social media concept of visibility and credibility can be applied to your business. Think of social networking as free advertising. Social media sites have transformed the business industry by cutting advertising costs. While one cannot put all of his advertising eggs into the social networking basket learning how to use various networks effectively can be a fruitful way to gain business. Research reveals social media helps to transform leads into sales and about 46 percent of online users turn to social media when making a purchasing decision. i According to 90 percent of marketers, social media marketing was important for their business, with 80 percent of them admitting their efforts increased traffic to their websites. ii What makes social media networking unique is that it humanizes brands and products through user interaction. When followers trust a brand they give it credibility. Also, it s no secret that people like doing business with other people and not with companies. That s highlighted by the fact that social media has been lead to a 100 percent improvement on lead-to-close rates. iii Venture Perspectives 2 Copyright 2014, CoVergence, LLC

4 SOCIAL NETWORKING CHALLENGES While social networking websites provide a number of benefits, they also present a number of challenges. First, some websites allow for sharing of personal information. Be sure to watch what you put out there. Information that has been posted online can often be permanently available to others. This leads to privacy issues, hindering some individuals from sharing information that may be useful to businesses. Secondly, there s no way of ensuring that the information posted by individuals is accurate. In addition, the penetration of advertising on such websites tends to estrange users. Finally, these websites suffer from hacker issues, where viruses, spyware, and other malicious content can be placed on individual pages, thereby hindering the performance and popularity of specific sites. In the past, business networking was at best a methodical process, involving months and even years of building a personal contact base. The business lexicon primarily couched online networking as a potential cause for concern. Business leaders wondered if online networking sites reduce productivity. They wondered if workers shirked their duties in order to connect with online friends. Others were worried about having an unsavory online presence. These concerns mirrored those in the culture at large, with parents and schools, for example, worrying about social networking sites. And even though society at large still wrestles with networking pitfalls, businesspeople are branching out to niche networking media and they are reaping tangible rewards. As society becomes increasingly mobile and technology-dependent, social networking websites will continue to provide a simple, inexpensive means for individuals to meet and establish connections with individuals across the world in a way no other communication technology has to date. While there are a number of challenges that must be considered, social networking will continue to evolve. That means the benefits will remain unmatched for businesses. Having a secure strategy in mind is important in order to gain the most benefits from growing your social networks. Venture Perspectives 3 Copyright 2014, CoVergence, LLC

5 ON TO BUSINESS NETWORKING Professionally minded social networking sites have been optimized with the workplace in mind. When it comes to using social networking for business, the established links between individuals provides easy access to a target market. Individuals are already linked based on similar interests, geographical locations and other factors. This allows for easy targeting of groups with less effort. Communication within the network can help to establish credibility of products and services, as well as serve as additional advertising. Some websites are dedicated to individuals of a similar background, such as those for specific universities, religions, etc., allowing for easier targeting. Social networking helps businesses when customers act as online referrals, posting their positive opinions and experiences online for anyone to see. Those who are strongly connected to a satisfied customer are more likely to be influenced to use a product or service as well. On some websites, advertising is offered for businesses. This allows for the simple, low-cost marketing of products and services. Finally, the frequent use of these websites implies individuals are Internet-savvy and are more inclined to use e-commerce technology for online purchases. Once your website is ready your company can begin interacting on social media sites. Those sites including Facebook, LinkedIn, Pinterest will attract people who will check out your company site and they ll get to know your offerings and services. A recent social media industry survey found that 97 percent of marketers are active on social media for that reason but good majority at 85 percent still aren t sure which sites and tools are best for them. iv Every business is different so you ll need to consider which networking sites will be truly worth your precious time and effort. The following two lists summarize some of the top social networking sites. The first is a likely recognizable list of social media sites that can be optimized for small business and the second list summarizes the most popular business minded sites today. Venture Perspectives 4 Copyright 2014, CoVergence, LLC

6 SOCIAL NETWORKING FOR BUSINESS Facebook It s not for college students any longer. With more than 1.1 billion active users it is the most used social networking site in the world. Since 2004 it has expanded to encompass several business oriented features. Create a business page if you haven t already; it s a simple way to gain visibility. Twitter Coined as the SMS of the Internet, Twitter requires posts that are short and sweet with 140 characters or less. With 300 million users worldwide and a system of followers your business can gain a following fast. Google+ It s a networking site attached to the top online search engine in the world. For optimum visibility place your company s information on Google+ which opened to businesses in Adding your company address and phone number can boost local search results should someone be looking for your kind of business. Venture Perspectives 5 Copyright 2014, CoVergence, LLC

7 SOCIAL NETWORKING FOR BUSINESS (CONTINUED) Pinterest Launched in 2009, Pinterest is perfect for those with beautiful and visually appealing products to sell. Pin your best product photos and you may see a huge following you didn t know was possible. YouTube YouTube s video sharing features are a great way for businesses to gain more exposure by sharing commercials, testimonials, promotions and more. Growing businesses may find success by starting their own YouTube channels where they can produce and upload easy-to-share videos. Venture Perspectives 6 Copyright 2014, CoVergence, LLC

8 BUSINESS SOCIAL NETWORKING SITES LinkedIn Launched in 2003, LinkedIn has 300 million registered users worldwide and has grown from a place to put your resume online to a robust professional networking site. Ryze Started in 2001, Ryze is a social networking site that links business professionals and especially entrepreneurs. There are currently over 500,000 members worldwide. Talkbiznow Talkbiznow offers business services like file sharing, web and voice conferencing, for small businesses and professionals. Small businesses love it because they can collaborate and grow their services in ways they hadn t thought possible. Biznik Founded in 2005, this site is focused on entrepreneurs and business professionals that aim to help each other become successful by networking and offering helpful information and tips about business matters. Perfect Business Dedicated to small business, this site connects you to a vast network of business people, experts and small business owners that believe in collaboration, entrepreneurship and mutual success. Plaxo In 2002, this business minded networking site was introduced touting itself as the world's leading online address book. It features a unique address book system that consolidates all your contacts across sources, automatically cleans and updates contact information. It has stored over 50 million address books with 3.7 billion contacts. Spoke Launched in 2003, Spoke started out as a way for users to maintain a list of companies, people and business topics. It has evolved to also include a way to create a customized stream of business information which is taken from an outside third-party perspective. Venture Perspectives 7 Copyright 2014, CoVergence, LLC

9 MOVING FORWARD WITH SEO Top 5 Considerations When Joining a Social Network 1. Purpose/Interest. Since social networks are designed to link users with common interests, activities, and goals, it is important to ensure that a social networking website is one that is of high interest. 2. Registration and Setup Requirements. The amount of time to register and create a profile on a social networking website should be relatively minimal. In addition, learning and navigating the website should be simple. 3. Popularity. More popular websites will have larger, loosely connected social networks, creating the opportunity to meet a greater number of individuals. 4. Security and Stability. Larger, more popular websites will also result in more attempts to access user information. Security issues can range from unsolicited posts on profiles, to spam friend requests, to retrieval of private user information. In addition, more popular websites result in larger traffic and potential stability issues when experiencing large amounts of traffic. 5. Advertising. Some websites allow advertising on user profiles, which cannot be removed, moved, or selected. Venture Perspectives 8 Copyright 2014, CoVergence, LLC

10 i Neilsen. How Connectivity Influences Global Shopping ii Hubspot. "16 Stats to Prove Social Media Isn t Just a Fad." iii Hubspot iv Social Media Examiner. "Social Media Marketing Industry Report." Venture Perspectives 9 Copyright 2014, CoVergence, LLC