The concept of Social Media is top of the agenda for many business executives today. Decision makers, as well as consultants, try to identify ways in which firms can make profitable use of applications such as Wikipedia, YouTube, Facebook, Second Life, and Twitter. Yet despite this interest, there seems to be very limited understanding of what the term “Social Media” exactly means; this article intends to provide some clarification. We begin by describing the concept of Social Media, and discuss how it differs from related concepts such as Web 2.0 and User Generated Content. Based on this definition, we then provide a classification of Social Media which groups applications currently subsumed under the generalized term into more specific categories by characteristic: collaborative projects, blogs, content communities, social networking sites, virtual game worlds, and virtual social worlds. Finally, we present 10 pieces of advice for companies which decide to utilize Social Media.
Today, everything is about Social Media. Some industry gurus claim that if you do not participate in Facebook, YouTube, and Second Life, you are not part of cyberspace anymore. Social Media allow firms to engage in timely and direct end-consumer contact at relatively low cost and higher levels of efficiency than can be achieved with more traditional communication tools. This makes Social Media not only relevant for large multinational firms, but also for small and medium sized companies, and even nonprofit and governmental agencies. Using Social Media is not an easy task and may require new ways of thinking, but the potential gains are far from being negligible. Dell, for example, states that its use of Twitter—a micro blogging application that allows sending out short, text-based posts of 140 characters or less—has generated $1 million in incremental revenue due to sales alerts. Some firms may even be too successful for their own good, as illustrated by Burger King's “Whopper Sacrifice” campaign: In December 2008, the fast food giant developed a Facebook application which gave users a free Whopper sandwich for every 10 friends they deleted from their Facebook network. The campaign was adopted by over 20,000 users, resulting in the sacrificing of 233,906 friends in exchange for free burgers. Only one month later, in January 2009, Facebook shut down Whopper Sacrifice, citing privacy concerns. Who would have thought that the price of a friendship is less than $2 a dozen?
A new trend is on the horizon, though; Watch out for Mobile Social Media! Mobile Web 2.0 is very similar to Web 2.0, as discussed earlier. In contrast to its predecessor Mobile Web 1.0, which relied on proprietary protocols (e.g., WAP) and use-based pricing, Mobile Web 2.0 is characterized by open standards (e.g., a transition to the TCP/IP protocol, the technical foundation of the World Wide Web) and flat-rate systems. Even the manual entry of web addresses using small and difficult-to-handle keyboards is becoming history. Soon, all items around you will be equipped with Radio Frequency Identification (RFID) tags that will be able to automatically connect to your mobile phone and send URLs to them, similar to today's text messages. This technical evolution is laying the groundwork for moving Social Media applications away from desktop PCs and laptops, toward mobile devices. Why log into Facebook if you can easily update all your friends using Twitter? Why wait until you return home to watch the new YouTube video if you can do so conveniently on your iPhone?
According to Jupiter Research, the market for Mobile Web 2.0 evolutions will grow from a mere $5.5 billion today to an impressive $22.4 billion by 2013. Mobile Social Media applications are expected to be the main driver of this evolution, soon accounting for over 50% of the market. In one way, this surge toward Mobile Social Media can even be seen as another step toward Internet democratization and closing the digital divide between developed and emerging countries. In India, for example, mobile phones outnumber PCs by 10 to 1. In Thailand, only 13% of the population owns a computer, versus 82% who have access to a mobile phone. It is therefore not surprising that the Pew Research Center—a Washington-based think tank—estimates that by 2020, a mobile device will be the primary Internet connection tool for most people in the world. Making Social Media applications mobile is likely to tap a currently unexploited base of new users. Even if per-capita spending in these countries may still be low, vast population numbers make them relevant for virtually any firm.
Obviously, Mobile Social Media does not come without a price. Some would argue that while it enables the detailed following of friends half-way across the world, it can foster a society where we don’t know the names of our own next-door neighbors. Be that as it may, and independent of whether or not one approves of such an evolution, it seems undisputable that (Mobile) Social Media will be the locomotive via which the World Wide Web evolves. Businesses, take note—and don’t miss this train!
