The impacts of social media on businesses are immeasurable. Businesses use social media to establish unique identities for themselves. Social media helps companies reach out to far-away clients. Targeted social media campaigns allow firms to filter markets. Even job openings are now posted on social media. When it comes to businesses on social media, the proverbial race is on. With a $600 billion market up for grabs, enterprises that fail to capitalize risk fading away.
To say that the last decade has seen a social media explosion would be an understatement. Today, envisioning a world without social media seems almost implausible. Yet, this is what our world looked like two decades ago. Facebook, the most popular of all social media platforms, launched just 15 years ago. Today, Facebook claims over 300 million users in North America alone. And the platform enjoys almost 3 billion users worldwide.
Today’s social media has transmuted into an interactive marketplace. It connects thousands of big and small sellers to hungry consumers worldwide. This is the era of ‘social commerce.’
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A Two-Fold Impact
The impacts of social media on businesses are two-fold. Social media has allowed companies to transcend physical limitations. Brands can now transact with potential customers previously thought to be inaccessible. Social media has also allowed businesses to leverage targeted marketing. Brands can directly reach out to even minuscule market segments.
Impact of Social Media on Business Communications
Social media has both humanized and particularized business communications. Brands have the ability to seek out people who have shown an interest in their products and services. Traditional marketing mediums pitched to the general populace. While on social media, marketers can filter out the noise and focus on the people who matter.
Now that marketers understand their clients better, they can effectively tailor marketing messages. As a result, brands have become more ‘human’ in how they communicate. And marketing communication has become more empathetic. People tend to buy more from brands they identify with. In turn, brands curate their identity exclusively for those they want to tempt.
Social media allows clients to converse with their brands in real-time. Expressing their grievances and gratitude directly without barriers or intermediaries. As a result, brands have become more responsive. Companies are looking to make deep personal connections with their clients.
Social Media as a Reach Multiplier
One of the critical impacts of social media on businesses is that it has shortened distances. Brands can now interact and transact with customers residing oceans apart. While it is true that e-commerce giants have seemingly built an impregnable dominance over online trade, the popularity of social commerce has seen an explosive upward trajectory. The reason can be summarized in a single word, ‘cost.’
More established brands have the ready capital to develop dedicated online platforms, while smaller firms lack this privilege. Social media has stepped in to bridge this gap by offering cost-effective and ready-to-use online platforms. As a result, small businesses have flooded the social media space.
But the buck does not stop with small enterprises. Established e-commerce giants are using social media to complement their platforms. Social media marketing campaigns rake in traffic which can later be re-diverted to websites. This battle for social commerce will decide the future of online trade.
Negative Impacts of Social Media on Businesses
In the volatile world of social media, a few bad reviews can demolish a brand’s reputation. And on social media, reputation is everything. The connectivity which facilitates so many businesses can backfire.
And once the downward spiral begins, it can be tough to mitigate. News, be it true or not, spreads like wildfire on social media; the damage has already been done when a company pushes back.
Social media has opened businesses up to new risks and opportunities.
While this technology has fundamentally altered some aspects of companies, many core business principles remain the same. The ability of brands to flexibly re-define themselves while preserving their core identities will be a crucial determinant of business success in the 21st century.