Using of Facebook as a Social Media Technique - Literature review Example

A Critical Review of the Use of Facebook as a Social Media Technique to Promote Small and Medium Scale Business Online Contents Contents 2 Literature Review 3 Introduction 3 Social Media as a Marketing Strategy 3 Making the Facebook page interesting to the consumers 7 Creating Advertisement 7 Conclusion 8 Reference List 10 Literature Review Introduction Businessmen in the 1970’s were not aware of the internet and the wide range of services that it can provide. Internet was better known in the arcane world of government and academic research. After mid 1980s internet started gaining ground in the business world and soon innovative strategies started being developed so as to use internet in a company’s favour. Over the years there have been numerous companies providing that have made very good use of the internet and have flourished phenomenally. Companies like Amazon, Myntra, eBay and Flipkart are providing online shopping experience to its customers and over the years this mode of shopping has been very well accepted by the customers (Internet World Stats, 2012a). However the industry had also witnessed a crash of some major companies and it was realised that competing in the age of internet has become more risky and this tool has to be used very wisely so as to gain the competitive edge (Internet World Stats, 2012b). Social media is still being deemed as a transforming power of the present world. It makes marketing more innovative and intellectual. Social media network allow its users to share ideas, events, activities and interests by providing a platform to share news and information, provides different alert services like CAS and SDI, facilitates enhanced consumer knowledge by allowing product reviews, provides information about new products and services and allows businesses to come up with innovative strategies that would help the owners expand the business opportunities among a wide range of customers (Kalmath, 2013; Humphrey and Schmitz, 2002). Social Media as a Marketing Strategy The activity of a group of people gathering together to share knowledge, views and information by making the use of conversational media is commonly known as Social media (Weinberg, 2009; Kaplan and Haenlein, 2009). There are different forms of social media that SMEs can take advantage of, for example, social book marking, blogs, social networking websites, content writing communities, virtual worlds, micro-blogging sites, online gaming websites, news sites, online forums and many more. Web 2.0 and social media are both, means of communication that share the same features implying both are user-friendly and user-empowering and enhance knowledge sharing (Erdogmus and Cicek, 2012). A company can overcome the problems associated with the conventional methods of marketing, by way of adopting social media marketing strategies. Thus the user will be able to efficiently allocate the available resources to improve communication with the existing customer base and acquire new customers thus enabling the business to grow and flourish properly (Jackson, 2011; Akhtar, 2011). Optify, a US-based digital marketing company conducted a research that revealed that social media sites, like Twitter and Facebook are considered the most effective tools that generate traffic thereby increasing sales (Pardal, 2012). A study by Info-graphics also revealed that that almost 54 per cent Facebook users have been discussing and recommending a company’s products among peers after getting involved with the same through Facebook. Their purchases of the company’s products have also increased due to such engagements (Safko and Brake, 2009). The social media can provide businesses with better promotion for their products and services and develop an online community for its buyers, apart from providing immediate support as and when required (Jackson, 2011). According to Mangold and Faulds (2009), social media also facilitates sharing of information between consumers regarding the quality and range of products and services that a company offers. It has been found that based on the conversation that takes place between consumers over social media companies are provided with a cost effective way of gauging the likes and dislikes of the consumers and to accordingly position their products and services (Gunelius, 2011; Constantinides, 2010). Therefore, social media marketing enhances a firm’s ability of networking, by way of community establishment and conversation (McKee, 2010). In the present world of a fast growing business landscape, in order to stay competitive it is absolutely necessary for a company to have a strong social media marketing strategy. In the contemporary scenario, there has been an increasing trend among companies to hire experts and professionals in the field of social media marketing so as to be able to analyse the characteristics of the customer base that the company has, their tastes and preferences, purchasing power, and real or disposable income. This gives them a clear idea as to the production levels and types and price ranges (Coon, 2010; McGrory, 2014; Social Media Today, 2013). It has been found out through different empirical researches that consumers visit social media websites to keep themselves up-to-date with the latest developments in a company’s product lines and to be aware of different ad campaigns (Michaelidou, Siamagka and Christodoulides, 2011; Leader-Chivée, Hamilton and Cowman, 2008). It is thus necessary that the SMEs take care in designing the website and upload relevant and exiting content that would attract customers as they prefer to browse through sites that are updated and hassle free. Introducing a smart phone strategy can also help the SMEs build their brands and a strong customer base as growing number of people is becoming tech-savvy with the passage of time. However there are an abundance of social networking sites, hence SMEs need to choose the appropriate platform that would help them target their customers. Use of Facebook as a Social Networking Site: Information and communication technology is considered as a major element of the corporate communication mix and marketing strategy. There have also been considerable shifts in the budget allocation from the traditional to online marketing sources. The economy of the present world is steadily becoming net-centric. Facebook is the perfect example of social media that small and medium scale enterprises (SME) can take advantage of. SMEs are small scale organisations with a limited budget. Hence they cannot afford to use marketing strategies like organising events as such strategies require the company to make huge monetary investments. Facebook on the other hand can make a business (Gnan and Montemerlo, 2003; Harris, Rae and Misner, 2012) Discoverable: Facebook has a wide range of users and hence reaches out to a larger number of people all over the world. Thus SMEs have the opportunity to cater to a larger segment of the population. Connected: Facebook offers its users some unique features like “checking-in” which allows a person to post on Facebook the location of the place where that person is visiting. A person can also “like” a page which allows the user to get regular updates from that page. Thus the SMEs get the opportunity of one-on-one conversations with its customers who would read their posts, like their page, share the page details with their contact list and check-in when they visit. Also SMEs can sell their products through Facebook by posting pictures of their products and the Facebook users can contact them directly if they are satisfied with the quoted price (Fosso Wamba and Carter, 2013). Timely: the owner of an SME can cater to larger groups of people by frequently sending out messages tailored to their preferences and needs. Insightful: Facebook offers statistical analytics to its page-owners by way of which the owners can get a better understanding of their marketing strategies and the special needs of their customer base. Visibility: In order to gain better visibility the page user can request a special web address like facebook.com/company’s name. This will assist the customers find the page easily. The owner can then print the web address on business cards and other marketing materials (Facebook, 2014; Beck, et al., 2008). Facebook can help the owner reach out to a large customer base as well as identify the potential customers. The owner has to make an analysis of whether there is any common preference that a particular section of his customers share, the age group that he is targeting and the place where they reside. Determining the place would help him decide whether he is targeting the niche market or the mass market as the residential address reflects on a person’s personal income. Decisions whether the products offered by the SME will be of any help to the customers is a crucial step in social marketing (Derham, Cragg and Morrish, 2011; Parker and Castleman, 2007). Moreover what kind of products, services and personal messages would the target audience entertain and deciding whether the sales would be boosted by a reduction in the prices. In order to boost the sales volume and build a larger audience the owner has to encourage the present customers to like the page as they are the people who would be receiving the posts in their News Feed. Facebook also offers an option to its users, namely, Build Audience so as to help the users achieve the target. This entails the following: Invite your friends: The owner should start adding people who are already there on the owner’s friend list as they would be able to support his company by liking the page. This initial audience would subsequently help in building a larger audience by way of establishing credibility and spreading the word through reliable source. Share your Page: the owner should be a strong spokesperson for the company. Self liking the page is very crucial as that sends across a strong message to the customers (Pentina, Koh and Le, 2012). Invite your business contacts: the owner should upload a list in order to send people an email to inform them about the page and increase the reach of the page. Making the Facebook page interesting to the consumers The owner should be able to make the company page on Facebook very interesting. He should have a clear idea as to what the tastes, preferences and needs of the customers are, design the page accordingly. Facebook gives its users various options of posting pictures or sharing useful links. The owner has to decide between pictures, links or other interesting topics that would grab the customer’s attention (Soriano, et al., 2002). The owner should be authentic about what he shares, implying he should share posts that he is genuinely excited about. The page owner should be highly responsive. When a customer comments on a post or raises a query, the owner should be able to tend to their queries adequately. In case where the owner needs more time to answer, that should be communicated to the customers. The page should be on the minds of the customers on a regular basis. In order to ensure that, the owner has to be consistent and regularly post on the page. Setting a schedule for the posts also helps in maximising the team’s time. The work of the owner that has been appreciated elsewhere should be highlighted so that it catches the attention of the people and thus start building the credibility of the company (Constantinides and Zinck Stagno, 2011). Converting successful posts into successful promotions is the key to attracting the attention of the customers. Facebook offers options like promote a post whereby the page owner can promote the page or build a larger audience for the post. When people like the post, it automatically gets shared in the News Feed of their friends thus increasing the reach of the page. Creating Advertisement Once the page has built a considerable audience for itself, the owner should divert the attention towards advertisement so as to target the right people that are in need of the product or service that the company is offering. Facebook ads have been designed so as to enable the Facebook users advertise for their companies. The “ad create” tool enables the owner in preparing as well as targeting the advertisement to reach the friends of the people that have liked the page. Thus the growth of the business is enhanced through word-of-mouth (McGregor and Vrazalik, 2004). However one has to be very specific about the audience that the advertisement aims to target and different sets of advertisements can be created to mark different audience. This differentiation strategy yields better results as well as people react positively to advertisements that been crafted keeping their tastes and preferences in mind. Fine-tuning the target audience is a very useful and necessary tool available in Facebook. This allows the owner to make a private list of his present customers the “custom audience” option and then the “lookalike audiences” enables the owner to target the people who are similar to those in the custom audience list. “Interest targeting” helps target the people who have liked the page or have liked on Facebook similar things that the company is offering (McGregor and Vrazalik, 2005; Elbeltagi, et., 2013). The “Page Insights” on Facebook provides the owner with the trends so that the owner can develop more of content that has performed the best. The age, gender and location of the people most engaged with the page should be identified so that they can be continued to be engaged through promoted posts and targeted ads. Facebook automatically optimises the campaign that is doing best, so that more of the budget is allocated to the ad that’s performing the best. The owner should conduct surveys to be able to analyse the products or services that the customers like and organise chats in the comments section since that would provide the feedback on customers’ reaction. This data will supplement the trends and the other statistical analysis that Facebook provides the customers (Nobre and Silva, 2014). Conclusion A detailed analysis of the growth and impact of on-line retailing on the small and medium business ventures was conducted, with special emphasis on the ways in which Facebook can help SMEs to flourish. In the present world of dynamic economy it is advisable to critically appraise the effects of a vibrant and sophisticated online market-place, from both the retailers’ and the consumers’ point of view. Even though it has been seen that online retailing is a very lucrative option for SME businessmen, however there exists challenges as well that needs to be overcome so as to make it a mainstream activity rather than a minority one. The retailers need to constantly innovate and develop strategies such as growing the brand, marketing via social networking sites, develop differentiated products and a user-friendly website that would provide consumers with a reliable and enjoyable shopping experience. These will help them respond well to enhanced consumer power. The retailers also need to work on the offline or the distribution channels so as to provide their customers with an effective service. Delay in delivering a product often leads to dissatisfaction thereby leading to flight of customers to competitors. Hence, handled well social media networking sites can help SMEs develop in a structured manner. Reference List Akhtar, S., 2011. Social Media and Brand Loyalty. [pdf]. Available at: http://www.socialtrakr.com/2011/07/12/social-media-and brand-loyalty [Accessed 4 August 2014]. Beck, T., Demirgüç-Kunt, A., Martinez. P. and Soledad, M., 2008. 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