Marketing Academics Pt.2

Marketing Academics Pt.2

Social Network Executive Summary

Social Network competition has brought a new round of investing and speculation to the Internet, not seen since the dot-com crash of the late 1990s. By the numbers, as of April 2006, the ten biggest social-networking sites had a combined 68.8 million users, drawing in 45 percent of active Web users [in the United States] (King, Rachael). In 2007 alone, venture capitalists invested about $250 million into 34 different social networks; in a separate investment, Microsoft purchased five-percent of Facebook for $240 million. It is without question that social networks will soon move to the forefront of marketing communications. The potential for the facilitation of customer community building is probably the greatest value and risk of current social networks. Social networks aid word-of-mouth marketing, consumer-generated media, permission marketing, education, and the construction of brand tribes.

For recruitment matters, in a best-case scenario, social networks will allow an employer to instantaneously filter millions of resumes and select a small group that fit a specific profile. Other advantages are expanding referral networks, maintaining relationships with good employees that moved to other firms, trait, and character scans by visiting personal pages, among others. Risks are generally related to privacy invasion and the simple inability to authenticate information.

Social networks are here to stay, or at least until something more entertaining replaces them. Web 1.0, that is, the Internet simply as a place to be seen, has now been replaced with Web 2.0, where the Internet takes on a personality of an aggregate of its users’ personalities and where functionality truly exists. Even though most of FaceBook and other popular social-networking sites are nothing more than “kids” having fun, more and more businesses are finding an important use for such sites. From recruiting past or new employees to set up communities for online brand tribes, social networks seem to be a perfect fit for marketing and human resources functions.

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