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Social Networking

Social networking enables users to manage, cultivate and extend real world or purely digital social networks through online communication mechanisms. Traditionally established as ways to replicate real-world connections (eg Friends Reunited launched in 2000), over the last ten years social networking has morphed to include relationships with people who have never (and most likely will never) meet but hold a bond of common interest.

Social Networking is still developing and changing fast in the business world.

Why is business so interested in social networking?

It is often quoted that if Facebook were a country, it would be the third most populous in the world[1], but if all of the members of the top 100 Social Networks were viewed in this way, it would have more than twice the population of China or 40% of the entire world population. Even though there will be many people on more than one network, this is still the largest target audience in the world! One irony of online social networking is that although it is designed to span boundaries of geography, culture and society, the pattern of membership is mainly contained within these parameters. One country’s main social networks are often not the same as another’s, for example Qzone a social network in simplified Chinese has 388 million users and Google’s Orkut has 100m users mostly in Brazil and India. One of the factors to Facebook’s success is that it has managed to avoid this digital patriotism (though it does suffer from government blocking, most notably in China and Pakistan).

Simplicity and open standards have made it relatively easy and affordable for enterprise to set up and be involved in social networking, as well as independent entrepreneurs and the willingness of users to disclose their personal information, whilst varying by generation, is another key catalyst for its success.

Recent examples of the changing landscape include the new BBC iPlayer 3.0 which includes a social networking and tagging capability, Apple’s Ping social network (which reports indicate gained 1 million users in its first two days) and Google’s blighted Buzz.

Key Functions of Social Networking

Recommendation: Peer review and recommendation has always been a key consideration for organisations entering the world of social networking, and it remains of paramount importance behind the motivation to remain and develop social networking features. As the audience becomes more networked, traditional ‘broadcast’ (one way communication) advertising will be less effective as the new alternative can offer friend-friend referrals, independent and trusted expert ratings and sites which have a greater level of consumer orientation )enabled by constant communication with consumers). Acquaintances’ opinions are important in making choices. Social Networks help to share information on products and services which in return may have an economic impact. Awareness of key trusted groups or individuals in social networks will be increasingly important for advertisers and companies.

This means social networking has a significant effect for marketing teams, which will need to connect to social applications to gather information about customer’s future needs in order to transform them into products and services. The challenge will be for social networking to balance between the value from the customer side (‘Why should I provide my information?’) and the marketing side (‘Which information can be gathered?’).

Games and Features: Social networks using Chinese language have a large emphasis on the games within. The top four social networks in China all feature game functionality strongly and it is seen as a key for making users more active and return regularly. As an example of this, the top social network by user volumes in China is Qzone (388m), but the most active user social network is RenRen (120m) which is helped by the quantity and quality of available games.

Whether the addition of more and better quality games in social networks will have the same affect in the UK and Europe is unclear (especially with subscription games such as World of Warcraft being so popular), but the China model does show that users will start to look for more than just connections, recommendations and conversations.

Mobile capability: Ubiquitous internet access, greater data rates and smarter phones have all enabled the move onto mobile for social networks. Major social networks now have developed mobile-specific versions of their sites. This move to mobile opens up possibilities to merging social networks with context-aware applications.

Standalone versus Add-On

Two distinct patterns are emerging for social networking – ‘Add-on’ or ‘Standalone’. ‘Standalone’ refers to a social network created for this purpose (eg Linkedin), ‘Add-on’ relates to the practice of adding social functionality to sites originally designed for another purpose.

Each has its own contrasting benefits: Add-on allows the possibility of taking a segment of a very wide and existing audience at very low cost. Standalone allows for ownership of the data, hosting and control of structure and content which enables social networking analysis.

Product-based social networks have lower barriers to entry for the standalone social networks. These can perform the function of owners clubs, allowing the manufacturer to keep closer to (and pamper) the real evangelists of their brand, monitor actual reports and comments from their customers, try out new ideas and to conduct social profiling and social network analysis of their existing customer base. All of this is an information gold mine for manufacturers and their sales forces and it is no surprise to see that the majority of car manufacturers have their own social networks set up.

What’s best – an area on an existing SN or starting another?

Starting a new social network from scratch is what is now a crowded market is a brave step. Added to the challenge of persuading a user to join the Social Network, is the added complication that their connections will need to join too in order for them to maintain the benefit they are receiving at their existing networks. This negatively influences the chances of success of any new standalone site.

Along with a presence in an existing social network, in an attempt to reap the benefits of a standalone site without the teething issues, organizations have taken to adding social elements to their sites. This targets the existing throughput of visitors to a site with no historical social-networking functionality. Often these visitors will sign in, so from a user perspective there is little or no extra effort required. These form examples of a social network where the users often do not already know each other and are not a replication of their social sphere. The value they receive is peer review, links and comments and the value for the provider is a level of user profiling which they would not get from a space on an existing social network which controls the information.

Managing the online presence

There have been various examples of companies who have suffered brand damage due to managing their online presence Monday to Friday 9-5 and the web at large working 24×7. To many it is not feasible to employ staff to manage this at weekends or unsociable hours (even in the biggest companies, managing a social network cannot be said to be a fulltime job). For those where moderation and representation at all times is a key consideration (such as Disney), third-party moderation companies are used which can manage these times using a more commercially effective model.

Way Forward

This split of pure social network alongside added social functionality to non-social networking sites is the emerging landscape today. Rather than setting up a new social network, organizations should be looking to have at least a presence on the regional Top 5 (the top social networks vary by country) and special interest sites of relevance, but also to consider partnerships with social networks to give the ability to add specific widgets and other features. An initial scan of potentially relevant social networks followed by regular scans to monitor changes and developments (such as potentially relevant new features) is a low maintenance way of keeping tabs on the market.

For example in the travel industry, it may be wise to consider standalone social networks relating to travel such as WAYN (10 million users) or Travelbuddy (1.8m users), but it will also be important to monitor travel sites with no previous social networking functionality which may be soon to add it in (Expedia, for example), or airlines extending their frequent flyer memberships. Rewards from this and related activity will aim to generate more customer information, contact, loyalty and increase brand image. Travel seems to be one of the leaders in this space, the recent Travelbuddy [link] lawsuit being in my view, a potential for a new legal precedent.

In terms of games and entertainment, it could be that with add-ons to existing sites such as BBC iPlayer 3.0 cornering the market for entertainment and social networking, that the major social networking players fail to introduce any captivating new features to make their networks more than simply a 21st Century phonebook.


[1] Source: Facebook.com – over 500m users. 1: China population clock 1.33bn, 2: India population clock 1.18bn, 3: USA population clock 310m.


Categories: General
Will Hyams

I’m part of the Atos Digital Strategy Practice, specialising in large-scale web disclosures, content management strategy and collaboration. I’ve always been a keen follower of new technologies and where they can be put to use to make all our lives a little better, so I’d describe myself as a business technologist as the people side is always more complex and so more fun!

1 Comment »

  1. Guy Lidbetter says:

    Would a better question to ask be “Why should business be interested?” rather than assuming it to be a fact across the readership?

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