How can companies build and maintain trust in social media?
Donchev, Mihail (2012)
Donchev, Mihail
Metropolia Ammattikorkeakoulu
2012
Creative Commons Attribution-NonCommercial-NoDerivs 1.0 Finland
Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2012092113803
https://urn.fi/URN:NBN:fi:amk-2012092113803
Tiivistelmä
In the PR and Communications industry there has been a dramatic shift in the effectiveness of bought channels vs. earned media. The client of this research project, Miltton Oy has developed its PR and Communications business by focusing on earned media models successfully over the last 10 years. Miltton sees social media as the fastest growing earned media channel.
Miltton Oy has expressed interest in finding how corporations can better use social media in corporate communications. While Finnish companies have been slower to accept social media, the situation is changing and they need to keep up with it. The research answers the question: ‘‘How can companies build and maintain trust in social media?’’. It has the purpose of providing the client with findings that can be used for pitching innovative social media consulting to potential customers.
The research questions help the client clarify why social media is important for business and what are the best ways to utilize it taking into consideration the changing marketplace. The significance of the differences between web 1.0 and web 2.0 technologies are researched as an initial step. Furthermore the nature of web 2.0 as a dual way channel for communication is emphasized. It is apparent that traditional businesses must adapt to the increased liberalization of social media and adopt a different approach. Evidence suggests that instead of being focused on their products and services companies should try to build long lasting relationships with their clients.
Different reasons for companies to enter the social media marketplace were explored. Companies pursue specific goals and try to extend their business operations in a new channel. Social media is utilized by companies for branding and reputation management, marketing and advertising, community management and customer service. Corporate communications are often incorporated in brand management. The findings indicated that marketing is used less and companies are orienting to build more honest relationships with their customers.
Determining success factors and measuring them was the second area explored in more detail. Engagement proved to be a factor that companies consider very important. Furthermore it became apparent that ROI is difficult to measure in social media, as the quantitative metrics used fail to illustrate why conversations happen and what their sentiment and outcome is. Primarily quantitative in its nature ROI focuses on deriving the business value for activities and while a study proves that there is a correlation between financial performance and social media engagement the cause of that relationship is not causal. However a pattern was observed that 7 of the top engaging brands in social media utilize a customer mindset to conduct a healthy business cycle.
Thirdly the amount of time and effort that companies spend developing their social media presence was examined. A minimum amount of 5-6 hours proved to be the common way of experimenting and integrating social media within businesses at a very basic level. A classification by Owyang and Altimeter Group showed that initial budgets of companies are quite modest while more experienced and mature companies were using almost the same amounts.
Finally to put everything into the perspective of the Finnish market a consumer research on trust provided by the client of this research project was used. The main trust building factors for Finns were personal recommendations, having positive brand experience, brands being proactive, brands providing value not for the purpose of sales alone and being honest and transparent. These key findings helped bind the research together and devise an action plan that companies can use for their social media efforts in the Finnish market.
It became apparent that in order to build trust through social media companies should concentrate on developing transparent and honest relationships with clients. Rather than pushing its marketing and advertising to the consumer the company would instead become attractive and pull people to its brand. The research showed social media is the correct platform for those trust factors. In order to fulfill them, companies would have to think less of what their brand wants to say and focus on what its stakeholder groups and clients would like to talk about and develop relationships around those conversations taking place in social media.
As a conclusion it can be said that the marketplace has changed and people do not feel obliged to do business with brands just because of their image. Honest and transparent relationships can help brands become friends with their clients and establish trust. Social media is best suited as a relationship building tool, rather than a marketing tool. Through those relationships brands can become attractive enough for people to seek them out themselves.
Miltton Oy has expressed interest in finding how corporations can better use social media in corporate communications. While Finnish companies have been slower to accept social media, the situation is changing and they need to keep up with it. The research answers the question: ‘‘How can companies build and maintain trust in social media?’’. It has the purpose of providing the client with findings that can be used for pitching innovative social media consulting to potential customers.
The research questions help the client clarify why social media is important for business and what are the best ways to utilize it taking into consideration the changing marketplace. The significance of the differences between web 1.0 and web 2.0 technologies are researched as an initial step. Furthermore the nature of web 2.0 as a dual way channel for communication is emphasized. It is apparent that traditional businesses must adapt to the increased liberalization of social media and adopt a different approach. Evidence suggests that instead of being focused on their products and services companies should try to build long lasting relationships with their clients.
Different reasons for companies to enter the social media marketplace were explored. Companies pursue specific goals and try to extend their business operations in a new channel. Social media is utilized by companies for branding and reputation management, marketing and advertising, community management and customer service. Corporate communications are often incorporated in brand management. The findings indicated that marketing is used less and companies are orienting to build more honest relationships with their customers.
Determining success factors and measuring them was the second area explored in more detail. Engagement proved to be a factor that companies consider very important. Furthermore it became apparent that ROI is difficult to measure in social media, as the quantitative metrics used fail to illustrate why conversations happen and what their sentiment and outcome is. Primarily quantitative in its nature ROI focuses on deriving the business value for activities and while a study proves that there is a correlation between financial performance and social media engagement the cause of that relationship is not causal. However a pattern was observed that 7 of the top engaging brands in social media utilize a customer mindset to conduct a healthy business cycle.
Thirdly the amount of time and effort that companies spend developing their social media presence was examined. A minimum amount of 5-6 hours proved to be the common way of experimenting and integrating social media within businesses at a very basic level. A classification by Owyang and Altimeter Group showed that initial budgets of companies are quite modest while more experienced and mature companies were using almost the same amounts.
Finally to put everything into the perspective of the Finnish market a consumer research on trust provided by the client of this research project was used. The main trust building factors for Finns were personal recommendations, having positive brand experience, brands being proactive, brands providing value not for the purpose of sales alone and being honest and transparent. These key findings helped bind the research together and devise an action plan that companies can use for their social media efforts in the Finnish market.
It became apparent that in order to build trust through social media companies should concentrate on developing transparent and honest relationships with clients. Rather than pushing its marketing and advertising to the consumer the company would instead become attractive and pull people to its brand. The research showed social media is the correct platform for those trust factors. In order to fulfill them, companies would have to think less of what their brand wants to say and focus on what its stakeholder groups and clients would like to talk about and develop relationships around those conversations taking place in social media.
As a conclusion it can be said that the marketplace has changed and people do not feel obliged to do business with brands just because of their image. Honest and transparent relationships can help brands become friends with their clients and establish trust. Social media is best suited as a relationship building tool, rather than a marketing tool. Through those relationships brands can become attractive enough for people to seek them out themselves.