Platt Perspective on Business and Technology

Creating value through business social networking in a business to consumer context

Posted in social networking and business, strategy and planning by Timothy Platt on June 19, 2010

Yesterday I posted the first of a two part series on creating value, and monetizable value from social networking for a business with Reciprocal Links, Value Chains and Strategic Development in a Business Ecology, and Creating Value Through Business Social Networking. My focus there was on going past the simple quantitative-only approach to social networking and simply adding to the connections numbers, to network for exchange of and creation of value and mutual value. That posting had a business to business (B to B) orientation in how I outlined possible approaches for developing and monetizing value and I said I would continue the discussion with a more business to consumer (B to C) focus today.

Most of what I wrote in that first posting applies in a business to consumer (B to C) context as well as to a B to B context , though the challenges for B to C may in some respects be more significant and for several reasons:

• Consumer and potential consumer populations actively participate in social networking all the time but most of this is in a non-business context and that colors user perception for when they do network to businesses through social networking channels.
• Many if not most people build their personal online social networks at least in part by the numbers and without consideration of specific value creation or exchange.
• Even when social networking web sites like Facebook and LinkedIn are heavily used and visited that does not automatically make them effective tools for marketing a business, in and of themselves.

Consumers and potential consumers that you would wish to reach through online social networking have expectations as to what this form of connection is for. Many if not most people who go online have developed a comfort level for doing business and making purchases online, but most of the social networking they do there is not oriented in their thinking towards this end. And they do carry an established momentum that business to business participants would not automatically start with, at least for online social networking resources that were developed and branded as business connectivity tools.

I wrote in my first posting on this of the need to move beyond simply looking for visitor and connections numbers, and that this means developing for value and in how you connect and where. For B to C, the most logical place to start would be with the transaction process and for its complete cycle from identifying potential customer demographics through reaching out to them with marketing , and on through any developed sales processes. And this would also include after-sales and customer support, and in reaching back to these customers to develop a basis for repeat business.

Effective business oriented B to C social networking should connect into and support the B to C business cycle and in a very focused, goals-oriented way.

• Are you trying to identify potential customers and better understand your target demographics and what they seek? Look to online networking groups and other forums where people are exchanging information, and participate in them, sharing information and asking questions and posting online polls and surveys. Set up your own online groups around areas of public interest that strongly connect with who you are and what you offer as a business, and in terms of social values that connect into and support your business’ culture. So if you offer environmentally sustainable products and services, connect into and set up online groups for which Green and environmentalism are meaningfully relevant.
• Are you trying to identify consumer needs and priorities to help you find tune and effectively evolve your products and services so you can offer a unique, appreciated value proposition? Online social networking with its consumer-originated input and feedback can offer invaluable business information here – if you focus on the venues and formats that the people you need to reach out to are going to.
• Are you looking to share information on your products and services, with updates on special offers and other time sensitive detail? Twitter and other opt-in direct connection formats can be of real help and certainly for people you have made an initial connection with.
• Instant messaging, live chat and other real-time social networking connectivity tools can offer immediate and person connections in sales and in after-sales.
• A crucially important point here is that you represent yourself as an individual person when you are socially networking as an individual, but that you identify yourself as representing a business when you are networking with regard to your business, your business values or your business products and services, or in response to comments posted about your business. This is all about credibility and building a basis for that.

Monetizing this means knowing what transactions come from and through what connection sources, and which of them end as completed sales, or as having supported or facilitated these sales. For customer support and other after-sales parts to this process, that means reengagement rates as repeat customers.

• Know your baselines and what levels of business and what closing rates are standard for your industry and type of business, and in your geographic reach. Here, the closing rate, or closing ratio represents the percentage of leads or initiated transactions that end with sales.
• Use unique URL’s and other identifiers to uniquely track performance for each of your campaigns, online social networking driven or supported, and otherwise. Then track both how effective these various campaigns and types of campaign are and how their performance compares.
• Monetize according to costs for running these campaigns and returns on investment from sales that can be tracked back to them.
• This becomes a lot less certain as to monetizable value for online social networking carried out for the purpose of business intelligence gathering, than it is for sales and sales oriented marketing outreach, but you can still get something of a idea as to monetizable value even here, if you track which demographic groups you are gaining information about and you then look for changes in your market performance for those same demographics as you apply this information so gained.

And in the same way most of what I wrote about in my first posting on this applies here, much of this applies to a B to B context as well, and certainly as far as connecting online social networking outreach to the steps and stages of complete relevant business process cycles and monitoring and monetizing from there. And as with that first posting this is all about focusing on value and both for where you conduct your online business social networking and how you do it.

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