Social Media and How It Affects Businesses - Essay Example

The paper "Social Media and How It Affects Businesses" is an excellent example of an essay on business. Social media and networking have considerably changed the business landscape. This is for both companies that utilize them and those that do not. Social media can be defined as where there are members who interact with a wide audience. One of the best known social media is facebook, which has thousands of regular users. Among the users are businesses including organizations, companies, and brands. This paper explains the effect of social media on businesses and associated benefits.

Social media has helped to forge a new era in business engagement and transparency. It has led to the creation of new opportunities and challenges in the business world. In the past, companies used to rely on flashy ad campaigns and press releases so as to communicate with their customers. This has changed drastically. Social media has enabled a direct relationship between various businesses and their customers. Transparency in the business world has been heightened by social media. Nowadays, people demand a more honest relationship with the companies they trade with (Manski, 116).

Traditionally, companies have been known to use large amounts of money when it comes to campaigns and advertisements. These traditional campaigns involved the spending of millions of dollars. Social media has provided these businesses with a cheaper alternative. Businesses can now campaign via this media. The spread of this information is usually wider due to sharing through the social web. In the past, if one had the experience to share with regards to a business, it would take days and weeks (Manski 118). Today, the click of a button can relay such information to millions of users.

Social media has fostered customer relationships with various businesses. Businesses now use social media to connect and engage with customers, as opposed to the past where the focus was trying to sell. The most popular brands tend to post less about their service or product. Instead, they post things that will enable customers to know more about the business. This has given social media users the motivation to do business with companies. A clear demonstration of this is the Timberland Company. The CEO, Jeff Swartz uses a twitter account to illustrate his personality rather than the shoes his company sells. This has endeared more customers and connections globally (Watts and Peter 441).

Businesses can also address customers' concerns over social media. It is imperative for companies to consider customer grievances or suggestions. Via social media, customers can post their concerns. The company then responds and reacts to customer queries. This has enabled the forging of a sound one-on-one relationship between businesses and their customers.

Despite all the advantages, social media may have a negative impact on businesses. Lies and falsehoods may easily be propagated within the social media (Watts and Peter 442). These quickly spread and tarnish the names of companies. This may affect the sales of the affected companies leading to decreased profit margins.

Businesses that chose not to employ the new media culture will lose out in terms of competitiveness and edge. Their customers will build relationships with other competitors who use social media. The quality of customer interaction has improved with social media. Transparency and open communications between businesses and their customers are now possible. Less money is now spent on historical advertisement strategies. Social media is a cheaper avenue for these campaigns.