Social Networking Sites And Its Impact On Advertising Marketing Essay

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To attract and retain customers and increasing advertising, businesses have always tried very hard. However in a global economy it is important and difficult than ever to make healthy customer relationship throughout geography, industry and at every stage in firms. Social media is increasingly taking centre-stage for advertising activities in this new age of information technology - marked by interactive sharing of data over the internet.


Social media is made to be given by social communication, made by utilizing maximum reachable and scalable publishing processes. Social media aids the man's requirement for social joining, using Internet to change broadcast media into social media conversations. It aids the dispersion of knowledge and data, changing people from consumer into producer. Businesses point to social medias as users generated content (UGC) or consumers generated media (CGM). Social media comprise of 3 parts:

Concept- information, art or meme

Media- electronic, physical, or verbal

Social interface- intimate direct, social viral, community engagement

Most prevalent modes of social medias are:

Statements with a high memory retention quotient and concepts and slogans

Grass-Roots direct action information dissemination such as installations, public speaking, performance and demonstrations

Electronic media with sharing approach and search algorithm technologies

Print media made to be redistributed


An increasing number of users are using the Internet in each aspect of their lives, comprising of with whom they want to do trade with. Cost is an important factor in the decision finalisation process and Web dependant consumers are searching for from sellers. The social customer wants firms to heed to its care and concern, to utilise the social media channels it uses and to proactively indulge with it in clear communications. More importantly, the power and influence they have will grow as well. The emergence of new social media technologies gives businesses the opportunity to change the way they relate to customers, shifting the focus from managing transactions to building deeper relationships. Before this there was no such way to capture all of the data and the abundance of communication was sparingly used. Social networks and Social Medias were able to garner the interpersonal communication.

There have been numerous research activities going on in the field of impact of social media on advertising activities. The Coleman Parkes Research (2009) was based on how social media is creating deeper customer relationships. The study examines fundamental factors shaping the impact of social media on company performance and customer relationships, including user adoption, customer engagement, and barriers to deployment and employee retention. This study was conducted in May 2008 and includes 541 phone interviews with top executives that include senior management, lines-of-business management, IT managers and customer service, sales and marketing executives at the top 500 companies in each country. Many important features came up:

Social media technology do have the likelihood to change the way firms make and manage relationship with their consumers

Fear, apathy and uncertainty are inhibiting firms from officially taking on social media technology

Social media technology is coming in the work place unseen, but firms have no official plans to do them

The research by Coleman Parkes (2009) showed the mentioned data:

75% of firms throughout the world show that social networking would come in the business unseen if not actively managed.

Two-thirds of companies see improved customer satisfaction from the adoption of social media and 64 percent report an improved reputation in the marketplace.

Already 2 in 5 companies can directly associate an increase in sales with the move to using new forms of media.

Although utilization of social media technology is small, there is proof that firms watch for great benefits in their utilization that would make better use of the technology going forward. Overall, the main benefits mentioned by customers comprise of improved feedback (78%); making a perception of the firm as forward looking (75%) and the lessening in time to resolve support problems (71%). Moreover, 40% of firms (47% in North America) could already link a rise in sales with move to utilising new forms of medias. 77% of all firms also say that social media would allow them to add new worth to their client communication - a visible showing that social media technology has an important role in customer relationships management. Two-thirds of firms too feel that social media technology give a good way of showing customer relationship. The research says that social media technology has a major part to play in the firm.


The following is the Porter's (1979) Five Forces analysis of the Social Networking Sites:

Entry of competitors

The entry barriers for entering the social networking sites are low as only a small investment is needed to establish the sites.

Threat of substitutes

The threat of substitutes is high since there are many ways by which there can be application of social networking sites.

Bargaining power of buyers

Bargaining power of buyers is high since there are many buyers and each one wants new features. There are many sites with similar features and hence it becomes difficult for the website providers to give all the features.

Bargaining power of suppliers

Suppliers face a great difficulty as they have to cater to large variety of demands by the customers. Hence they have a low bargaining power.

Rivalry among the existing players

Rivalry is high amongst the players since there is great competition to acquire and retain a large number of clients. This rivalry also encourages innovation which is beneficial for the customers.


Cone (2008) describes social media as a technological communication amongst individuals- content sharing, blogs, forums, social networking and social gaming. Few research results are:

Increasingly large quantity of users use social media sites and tools perhaps 2 or 3 times a week

Users who use social media sites and tools also communicate with firms via social media sites at least some time in a year

Social media users believe companies should market to consumers

The part of firms within social networks are problem solver- virtual customers services, solicit feedback- fan pages, branded sites and give new ways to communicate with brand

Users who use social media feel better about companies and their brands when they can interact with them through social media. Users feel stronger connection and better served.

Overall, this report gives a healthy thumb's up to Social Media and how it works with Marketing. Young male clients are the most difficult to approach whereas the maximum revenue households are generally very much needed. This study would really encourage companies to give more energy and resource in social media and to manage it effectively.

The dispersion of online social media forum has altered the way customers have data and feedback relating to a specific firm's products or services. Sales representatives are forced to sell to a likely candidate that likely knows about the competition (Aberdeen, 2009). This new sale difficulty has resulted in a variety of firms to do social media things in the company as a way to appropriately link sale representatives to the experts they want. In 2008, Aberdeen surveyed around 220 firms to know the utilisation of social media solution in the sales departments and help in the lessening of contribution and amount of time sales representatives spend looking for related data. This study evaluates how major performing firms use firm social media solution as a step to lessen sale cycles and raise overall sales productivity.

Major results are:

Top performing firms presently involve process and technology to get a high stage of collaboration and finally a superior sale performance.

The force to raise topline income growth (63%) and augment full sales productivity (60%) were seen by survey respondent as the top 2 pressures resulting firms to focus resource on the firm capabilities used to augment sale performance.

By causing firm capabilities with a strong focus on firm social media solvers, best firms impact performance and raise market share.

73% of best firms plan to raise the budget for the firm use of social media technology in 2009

59% of best firms see the utilisation of social media collaboration tools in the sale departments to be a major point for the firm.


Customers will increasingly find the information they need to make purchasing decisions, rather than relying on what's pushed to them (Future of small business, 2009). This aligns perfectly with the mindset of the social customer, who is more likely to turn to Google for information than to their inbox. That's why it's critically important to expand your customer relationship management strategy to engage social customers. Social media adds missing dimension to the traditional and operational areas of media. The focus is undoubtedly on people. It's about joining ongoing conversations customers and prospects are already engaged in while resisting the urge to try and control them. Its understanding where the kind of people you want to do business with hangout on the Internet, and what they do there. Moreover, its social customers want to feel important and valuable to the businesses they frequent. Not just for the dollars they spend, but for all they bring to the relationship. They want businesses to show real interest in them.


The focus of social media differs from traditional media in a few fundamental ways as described below (Media Essentials, 2009):

Data-driven vs. Content-driven

Firms started to invest in advertising application in the 1990s majorly to have contact information. Before introduction of contact management software, firms use to save their valuable customers data in spreadsheet and cabinet filing. It was imperative to have an important place to save the information which was also easily reachable to talk in a better way with contacts. It immediately became imperative to be able to see appointment, activity and potential deal. As a result, traditional media built through this need to save, track and look on important data about customer and prospect. Social media is coming in a very big way and the need to encourage the mind Internet users to look for answers to business difficulties they are looking to counter.

Conversation-centric vs. Process-centric

Traditional client relationships management is majorly seen on using and automating steps. Firms looking to use steps- lead and activity management will shift to advertising. Management will shift to social networking sites to streamline on sale process to raise the veracity of sale forecast. Customer service request can be seen, transferred, raised and solved in a similar way to say proper handling. Traditional media helps to make it likely to enable the proper tasks will be done by the apt people in the correct way.

Although there is process linked in making a useful social media strategy, communications are at the centre. Doing meaningful conversation with those looking for aid that could be provided is the changing point in changing clicks into clients. The steps used are targeted at to enable it simple for people to look through our content and call us into a conversation. This might take the way of a comment posted on a blog, seeing the firm on Twitter or likely using PowerPoint presentations on its Web page. There are many processes to participate in useful communications with people searching for aid in solving difficulties. Making a strategy to raise the probability of linking in these communications is a part of social media.

People/Communication focus vs. Operational focus

Managing client data is an important link to business of all sizes. It has a major part in the likely of firms to tell to customers' requests, see resource required to close deal aptly and give management with report to enable tracking of sale performance. This aids in executives to get operational usefulness and is specifically important for firms in the business of sales working needing to use new steps to manage growth. Firms have generally shifted media to augment interaction between sales and marketing workings and to augment data reachability to better affect decision making.

Traditional media processes focused majorly on operational productivity and its effect. Social media is all about people and society. It is about how the firm sees to get involved in the ongoing communications happening in the industry. Fully fathoming the relevance of aiding to conversations in a clear manner would aid in building the kind of image required to be a worthy member of the online community prevalent to the business.

PPT (People, Process, & Technology) vs. AAA (Automation, Analysis, & Audacity)

There have been many definitions for customer relationship management over the years. In fact, hundreds of thousands of definitions can be found on the Internet. Many people view it as technology driven. Others view it as a way to standardize important sales and marketing functions and processes. And customers, along with the people who serve them, have always been central to advertising success. So it's easy to see why a good number of traditional definitions for advertising centre around three words - people, process and technology.


This report gives a study on how media firms could link the topic and evaluate the vendor and why Social media monitor is a difficult path catering to many places (Gartner, 2009). Major results are:

Social media overlooking is generally getting the honor of a needs amongst leading media marketing firms

They have same core parts and social media looking solvers give a large variance of ways to see social media driven data and linking it with working workflow

Major share of the problem that social media site has had in majorly moving the traffic and is linked to the deficiencies of present measurement ways that inhibits ways at marketing in social environments

Brand advertisers see a major way in looking the race of social media reactions and opinions proliferation with traditional movement development cycles.


Traditionally, companies have used media technologies to interact with customers in a narrow, highly prescribed way that focuses primarily on transactions: structured processes, contact data, efficiency and cost. Relatively few companies are taking steps to adjust their strategies and technologies to improve the customer experience, foster deeper relationships, and build brand loyalty at a time where the technology exists to fundamentally change the nature and quality of the customer relationship in many industries. The emergence of new social media technologies gives businesses the opportunity to change the way they relate to customers, shifting the focus from managing transactions to building deeper relationships. Businesses can apply social networking and related technologies to reach a new level of internal and external collaboration in a variety of business scenarios, including customer contact centres, online marketing and direct sales.

Social media technologies will allow companies and customers to establish a deeper relationship that empowers the customer in new ways and pushes both parties to a more rewarding level of engagement. Companies that understand the impact of these technologies can improve their customer relationships, corporate reputation and increase sales. Those that do not make plans to formally adopt these technologies can lose customers and fall behind in the market.


Social media technology is going to a turning point. LinkedIn, Facebook, blogs, live Web chat, instant messaging, short-text blogging have linked to build a powerful way of conversation, collaboration and knowledge participation for large and small business. Active involvement puts marketer a choice to augment customer relationships.

Social media requires a Different Mindset - many adverstising tactics, strategies, and opinions were developed well before Facebook, YouTube, and Twitter entered the consciousness of the business world. Social tenants like participation and transparency were not in the business vocabulary - neither were terms like blogging, podcasting, and mashups. That's why it will require a change to the way many businesses think about communicating with customers and prospects. They will have to feel comfortable with being a participant in conversations with social customers, and be ready to let them decide where the conversation goes. It also means opening up conversations on your Web sites and blogs that might not always be positive. But those companies who are willing to join in and be a part of the community, without trying to hijack it, will gain a great deal of respect more respect than companies who are perceived as ignoring them. So attempting to use social media tools without adopting these social tenants may result in being worse off than not using these tools at all.

Integrating social media tools and strategies into your traditional media efforts can increase your efforts in building meaningful relationships with those looking for solutions to the challenges they face.


The key is to first understand how these prospective customers use the Internet in terms of information gathering, communicating, engaging in conversations, and finally in determining who they choose to do business with. A firm understanding of these key areas will increase the likelihood of a successful marriage between traditional media efforts and your relationship with the social customer.

Companies should use social media analytic as a base business need integrated in all client presentations

Media firms which invest in content development have a specifically major requirement to fathom and see client trend by mining of social medias and should build core disciplines likewise.

IT firms aiding new media marketing objectives must have the priority order for the adoption of social media monitoring ways and linked metrics base

Community is a major medium. The social relevance of such societies is forcing firms around the world to utilise these networks. A strategic way is leverages the social network and take them to a goal. A proactive firm that uses such new models of marketing is to live inspite of the economic fluctuations.