Leo Rockets Design

“Designing the world around US”

Curated by Ivo L Lima

www.businessdayonline.com (via @workhomedad) - May 21, 11:35 PM

The impact of social media on marketing

Social media can be referred to as internet based applications that allow users to create and exchange information. Social media platformsare convenient, accessible and scalable; hence they have revolutionized the way we communicate. In fact, social media has become so ubiquitous that Facebook started trading on NASDAQin what was tagged the largest-ever Internet IPO, which could easily value the company above $100 billion.

Analyzing the impact of social media on marketing is very important because marketing is an important pillar in an organizations overall business strategy. It is within marketing plans that we see details such as marketing objectives, marketing mix decisions and marketing decision making variables of segmentation, positioning and targeting – which are all crucial in achieving business objectives.

In addition, modern companies also have social media strategies which are driven by the marketing strategy. A good social media strategy creates a platform to initiate and act on conversations around key customer concerns. A company’s presence on social media platforms should have clear objectives such as building visibility, deepening relationships and enhancing credibility. This will create interest and awareness about the value proposition.

Even though the use of social media is exciting, the most critical factor that must be considered is the impact it has on the business. Unfortunately, many companies join the social media bandwagon without ensuring that it synchronizes with the overall marketing strategy and business objectives. This often fails to achieve the business objectives because it is not a targeted effort.

Social media has had a profound effect on marketing in its ability to influence consumer behavior. There has been proliferation of web advertising with big multinational corporations such as Coca Cola also getting involved. Coca Cola now reaches out to millions of customers outside the traditional digital channels such as television and radio by advertising on YouTube. This trend has also caught up in Nigeria with major Nigerian banks such as Zenith, GT Bank and even the more traditional First Bank all reaching out to customers through twitter and Facebook.

As a result of this trend, marketers now deliberately use social networking sites to target prospective customers, for example, ten years ago advertisements on the American Super Bowl had an element of surprise to them with millions of people waiting to see the ads on the Super Bowl day. However, in recent years, some of the major advertisements are pre released on social networking sites such as Face Book, twitter and You Tube. This generates excitement even before the game, which is an indication of how marketing has changed in this era of social networking.

Furthermore, market research companies now use the power of the internet and social media to gather data about consumer behavior through the use of online focus groups and surveys. A well-knownweb based resource; survey monkey offers survey solutions and an alternative to the traditional market research. This example shows that technology, especially social media and the proliferation of devices such as smart phones has re-defined marketing.

However, I contend that in the next few years, these technology based social media platforms will make it more difficult for marketers to target consumers due to fragmentation. This fragmentation will be aided by the increase in technological devices such as iPhones and iPads. This is because the use of such devices cuts across the traditional age, gender and income group segments. This is also likely to reduce the effects of mass marketing techniques and brand loyalty.

In conclusion, even though social media platforms will continue to create opportunities, it remains to be seen if these myriad of opportunities can be converted into significant revenue growth by companies.

Kayode Yusuf

Chartered Accountant & Management Consultant