Social media are changing the rules for business

Social media are changing the rules for business
By Paul Henri Ferrand, vice president for SMB Marketing at Dell

Published: July 24 2009 12:40 | Last updated: July 24 2009 12:40

Does it seem like the world has gone Twitter-crazy? But crazy or inspired, one thing is for sure – social media have changed the way we do business forever.

For a start, the way reputations are built has changed. Not that long ago, the sum total of how an organisation portrayed itself in public set its reputation over time. Customer opinion was important but conversation was much more one-way. Reaching millions of customers with a message was expensive and time consuming.

Those days are gone. An organisation’s reputation is being altered and formed constantly. Around the globe people are searching for information, buying online, formulating opinions and sharing them. A company may win or lose potential customers based on an online conversation.

With the click of a button, a business can connect with customers in real time, hold conversions and build raving fans. In short – social media is one more thing breaking down the barriers between SMEs and large enterprises.

This means that companies:

• need to adapt or risk losing business;

• cannot overlay traditional marketing on to social media platforms and expect it to work;

• have a tremendous opportunity. SMEs in particular can use social media to leapfrog large competitors.

Get in the game

It can feel risky to open the gates and be so direct with the public. But a company is going to be discussed anyway, and it might as well be part of the conversation. The ease and speed with which customers now share information goes far beyond what we could have imagined even a few years ago.

At Dell, we’ve significantly turned around our approach to social media, from a cautious start years ago. Our Direct2Dell forums allow customers to express freely their experiences of using Dell products and we take the good and the bad into account at a senior level.

These forums, that we do not edit or censor, feed into our future product design and give our company invaluable feedback on what truly matters for consumers, small businesses and large enterprises.

We’ve also launched blogs, Facebook groups and pages, a crowd-sourcing platform called IdeaStorm, and we were one of the first big enterprises to be active in Twitter. Through all this we’re having over 5m conversations per day with potential customers, over 2bn interactions a year!

There are a few different ways businesses can “jump in”:

• Closer Conversations

Blogs are a great sounding board, engaging key audiences in fast and honest conversation. Leave any business-talk offline and make sure to get across personality and opinion. They can attract negative comments – but open and transparent answers can counter that.

Microblogging (ie Twitter) allows companies large or small to send out regular chunks of news or insight easily. Even when expanding a small business and hiring new recruits – Twitter and Facebook can be great ways of putting the word out. I know of SMEs who have got back in touch with old colleagues and head-hunted them.

• Building relationships

Know where customers are talking. Use Google Alerts, Netvibes, Yahoo Pipes and Technorati to adapt campaigns accordingly.

Online dialogue is direct and personal, and requires the highest levels of transparency. Fans know a company’s products and brand, and can be ambassadors for them.

So it is important to have an open exchange. Listening to customers and influencers has always been fundamental to good business, and this is integral to any social-media marketing campaign, and provides real-time insight.

Crowdsourcing lets customers be actively involved in creating new products and services, or solving a business challenge for your company. No one knows better than customers what they want and need. Two heads (or 200,000) are better than one.

Multi-way, Not One-Way

As companies jump in, it’s important to remember that traditional marketing unaltered will rarely work in the social media world, because it is built around one-way conversation.

The message needs to be adapted to prepare for dialogue – which can involve some fun, with the building of a company’s online “personality” in real time as it starts sharing with the world.

SME Leadership

Where is all this heading? Just three years ago we may have struggled to understand the importance of social networking sites. Today, there are hundreds of millions of potential customers engaged in these networks and virtually no barrier or cost to an SME joining and connecting with them.

I would argue that because SMEs are so agile and efficient, they might dominate the social media business landscape before the majority of large enterprises.

While Dell is proud to be a leader in social media, only 12 per cent of the Fortune 500 even have a company blog.

I also think we’ll see far more diversification of social networks aimed at specific interests – for example www.webjam.com allows anyone to set up a social network on their personal hobbies. This will allow SMEs even more chance to target or network with specific customers.

Like most things, the only way to “get” digital media is to jump right in. Start building a brand on social networks now – that’s the key to hiring staff and finding customers that will allow an SME to thrive, whatever the economic climate.

Copyright The Financial Times Limited 2009