CHPT. 14 BUSINESS NOTES

Companies are using social media because it allows companies to:
-connect with customers
-listen to its main stakeholders
-provide another means of customer service
-engage customers in product development and formulation.
Blogs are effective at:
-Developing better relationships with customers
-Attracting new customers
-Telling stories about the company’s products or services
-Providing an active forum for testing new ideas.
Before participating in media sharing, consider the following 3 factors:
-Who will create the photos, videos, and podcasts that will be used?
-How will the content be distributed to interested businesses and consumers?
-How much will it cost to create and distribute the material?
Social media enables shoppers to:
-Access opinions, recommendations, and referrals from other who have bought a product or service.
One of the most important aspects of social media is
entertainment
Social media communities
-Encourage two-way communication
-Allow for people to develop profiles
-Identify other people to connect with by using technology and the Internet
People in each social media community can be called
Friends, fans, followers, or connections
Top four social media community sites
Facebook
Twitter
LinkedIn
Blogs
There are social communities for every
interest, ethnic group, and lifestyle
Different types of social communities include
forums and wikis
Forums are particularly popular
with people who share a common interest
With wikis, members of the community are
editors and gatekeepers ensuring that the content is correct and updated.
ex: Wikipedia
One of the most important reasons for listening to stakeholders is
to determine whether there is a crisis brewing.
The first step when developing a social media strategy
Listening
Many companies have been successful using social media marketing to
develop customer awareness and obtain sales leads and increase actual sales.
Tools used for inbound marketing include
search engine optimization, blogging, videos, and social media.
Social media marketing is
only one aspect of digital marketing
Digital (online) marketing is comprised of several areas including
-Online public relations-developing social media press kits
-Search engine optimization-using keywords in the website in order to rank higher in search engine results
-Search engine marketing-buying ads to increase traffic to a company’s website
-Display advertising-buying banner ads
-E-mail marketing-targeting customers through opt-in-e-mail campaigns
-Content marketing-developing photos, videos, podcasts, blog posts, and other tools to increase the value to the customer.
Valuable information can be obtained by
crowd voting
Current employees’ friends and family may prove
to be good job candidates
Before developing a plan to use social media, it is important to determine
How social media can improve the organization’s overall performance and how it “fits” with a company’s objectives and other promotional activities.
Step 1: Listen to Determine Opportunities
-Monitoring social media sites allows managers and employees to enter the conversation and tell the company’s side of the story.
-Companies can monitor social media sites to gather information about competitors as well as what is being said about the industry.
After the listening phase, it is important to
analyze the information to identify the company’s strengths and weaknesses before taking the next step-setting objectives.
For social media, an objective is
a statement about what a social media plan should accomplish.
-Each objective should be specific, measurable, achievable, realistic, and oriented toward the future.
-Most popular objectives are increasing brand awareness, acquiring new customers, introducing new products, retaining current customers, and gaining customer insight.
-Other objectives that are often important include improving search engine ranking, showcasing public relations activities, increasing website traffic, and generating sales leads.
When segmenting or targeting customers, it helps to know
-how they think
-how they spend their time
-how much they buy
-how often they buy
Lack of information about customers can lead to
wasted time and money and the inability to successfully achieve the firm’s social media objectives.
Type of information that can help target different social media customers
-General Information: age, income, gender, ethnicity, education, occupation, family size, religion, etc.
-Identifying factors: What do they consider important? How do they spend their time? What do they buy and how often do they buy?
-Social Media Use- How often do they use social media? Do they use Facebook, Twitter, YouTube, and other social media sites? Do they create videos, Web pages, or other content? Do they read ratings and reviews? What other factors can help you identify potential social customers?
The search for the right social media tool(s) usually begins with
the company’s social media objectives, outlined in step 2.
-It also helps to review the target customer or segment of the market the company is trying to reach (step 3).
-next step is to choose the right social media tools to reach the right customers.
-it is possible for a business to build a social media community-especially when the objective is to fund local community projects or charities.
To increase effectiveness of social media, companies will often
integrate online promotions with more traditional or offline promotions.
Two types of social media measurement
Quantitative and Qualitative
-most companies tend to use quantitative
Quantitative measurements for blogs
-unique visitors
-number of views
-ratio of visitors to posted comments
Quantitative measurement for twitter
-number of followers
-number of tweets and retweets
-click through rate (CTR) of tweeted links
-visits to website from tweeted links
Quantitative measurement for Facebook
-number of fans
-number of likes
-number of comments
-growth of wall response
-visits to websites from Facebook links
YouTube
-number of videos
-number of visitors
-ratio of comments to the number of videos uploaded
-number of embedded links
In measuring success or failure of social media activities with KPIs
-First step is to connect KPIs with objectives
-Second step is to set a benchmark-a number that shows what success should look like.
Other measurements for determining customer sentiment include
-Customer satisfaction score
-Issue resolution rate
-Resolution time
When compared to quantitative measurement, it should be noted that many of these qualitative social media measurements
are more subjective in nature
Basic assumption based on the cost of maintaining a social media plan
Social media is not free and can be quite expensive.
Because social media cost both time and money, it is important to
measure the success of a social media plan and make adjustments and changes if needed.
-Based on quantitative and qualitative measurements, the company may also try to determine if it is getting a positive return on investment in social media.
After reviewing results for social media activities against pre-established benchmarks, it may be necessary to
make changes and update the plan to increase the effectiveness of the social media plan.
A social media must provide
current and up-to-date information in order to keep customers coming back to see what’s new.
-Without updates, customers lose interest and the amount of returning customers can drop dramatically.
-It is important to create future social media plans based on what worked and what didn’t work in previous plans
-Social media is particular important to business that use e-business to sell their products and services online.
e-business is used when
you’re talking about all business activities and practices conducted on the Internet by an individual firm or industry.
E-commerce is
part of e-business and usually refers only to buying and selling activities conducted online.
To be organized, e-business must combine
human, material, informational, and financial resources.
-resources may be more specialized than in a typical business.
Material resources in e-business
must include specialized computers, sophisticated equipment and software, and high-speed Internet.
Financial resources in e-business
the money required to start and maintain a firm and allow it to grow, usually reflect greater participation by individual entrepreneurs, venture capitalists, and investors willing to invest in a high-tech firm instead of conventional financial sources such as banks.
Two basic assumptions based on the Internet
-The internet has created some new customer needs that did not exist before the creation of the Internet.
-e-Businesses can satisfy those needs, as well as more traditional ones.
The internet can be used by both
individuals and business firms to obtain information.
-Internet users can access newspapers, magazines, and radio and television programming at a time and place convenient to them.
-The internet provides the opportunity for two-way interaction between an Internet firm and the viewer.
-Customers can respond to information on the internet by requesting more information or posing specific questions, which may lead to purchasing a product or service.
-Allows customers to choose the content they are offered. Knowing the interests of a customer allows an Internet firm to direct appropriate, smart advertising to a specific customer. For the advertiser, knowing that its advertisements are being directed to the most likely customers represents a better way to spend advertising dollars.
Business firms can increase profits either by
increasing sales revenue or by reducing expenses through a variety of e-business activities.
-sale merchandise on the internet
-shifting revenues earned from customers inside a real store to revenues earned from these same customers online does not create any real new revenue for a firm.
-goal is to find new customers and generate new sales so that total revenues are increased.
e-business revenue streams are created by
advertising placed on Web pages and by subscription fees charged for access to online services and content.
Many internet firms that distribute news, magazine and newspaper articles, and similar content generate revenue from
commissions earned from sellers of products linked to the site.
Reducing expenses is
the second major way in which e-business can help to increase profitability.
Regardless of the type of business model, planning often depends on
if the e-business is a new firm or an existing firm adding an online presence
In order to generate sales revenues and earn profits in an e-business, a firm must
meet the needs of its customers
First type of B2B firms
focus on facilitating sales transactions between businesses.
Second type of B2B firms
complex model that involves a company and its suppliers.
-Suppliers use the internet to bid on products and services they wish to sell to a customer and learn about the customer’s rules and procedures that must be followed.
Typically, a business firm that uses a B2C model must answer the following questions
-Will consumers use websites merely to simplify and speed up comparison shopping?
-Will consumers purchase services and products online or end up buying at a traditional retail store?
-What sorts of products and services are best suited for online consumer shopping?
Other business models that perform specialized e-business activities
-Advertising e-business model
-Brokerage e-business model
-Consumer-to-consumer model
-Subscription and pay-per-view e business model
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Primary reasons for using the internet include
the ability to connect with others, to obtain information, or to purchase a firm’s products or services.
Data mining
can then provide what might be considered private and confidential information for individuals.
Malware is often based on
the creator’s criminal or malicious intent and can include computer viruses, spyware, deceptive adware, and other software capable of criminal activities.
A more specific term used to describe disruptive software is
computer virus
The potentially devastating effects of both malware and computer viruses have
given rise to a software security industry.
Identity theft is
one of the most common computer crimes that impacts both individuals and business users.
When cloud computing is used
a third party makes processing power, software applications, databases, and storage available for on-demand use from anywhere.
Although the environmental forces at work are complex, it is useful to think of them as either
internal or external factors that affect how a business uses computer technology.
Internal environmental forces
are those that are closely associated with the actions and decisions taking place within a firm.

typical internal forces include a firm’s planning activities, organizational structure, human resources, management decisions, information database, and available financing.
-more likely to be under the direct control of management.

External environmental forces
affect a company’s use of technology and originate outside the organization. These forces are unlikely to be controllable by a company.
-include globalization, demographic, societal, economic, competitive, technological, and political and legal forces.