Is social media vital for businesses?

Online social media is not only the key to small business success, in my opinion it is the key to any sized company business success. Why is that? People do reach each other much easier than it happened to be five or ten years ago. Cold calling approaches (calling a person that has not been consulted by the company before, in order to make business out of this call, i.e. sell a product) are not very necessary anymore, because thousands of people are reached through the advertisement that facebook and other social platforms post on the consumer sites.

Please have a look at one of the most wealthiest entrepreneurs Eric Lefkofsky, who invested heavily in new businesses and mostly relied on social media. His newest invention is a company called Groupon many people have probably heard about before. This firm is entitled to be the fastest growing company ever. As stated in the article by the New York Times, Mr. Lefkofsky's companies all used social media very heavily and all of them were very successful so far. In my opinion social networking gives even more opportunities to the customer as well as to the marketer.
 
Location-based social networking and marketing

Let us talk about location-based social networking and marketing. This is one step further ahead of plain social media platforms what companies can use in order to show their ads on websites and profiles. The discussion is always about the target customer. The target customer needs to be reached. How do I reach my target customer in the best way? That is the question. Would it not be great if I knew who my target customers are? If I knew where someone is in order to post a certain ad? That's what location-based social networking and marketing is about.

Social networking has become a great and significant player in the business industry during the past years. Marketers during these days do not only try to find out what we like in order to send the perfect ad to our e-mail and web 2.0 accounts, no they also want to know where we are. Location, location, location becomes important in another sense in the 21st century.

Our computers and nowadays even phones are able to unveil our current location. Programs and special applications are implemented so the user is able to check-in to those applications and unveil his or her status. By doing this special rewards such as coupons from retailers are given to the user (see Groupon). Facebook for example just recently introduced his new service Places. Further the company has decided to give retailers the ability to offer rewards through this service.

The general idea behind this concept is genius, but is the customer keeping pace with the technology and that change? As of August 2010, a current article of the New York Times states that only four percent of American adults used location based services. This number decreases by three percentage points when filtering the people out who do not use that service on a daily basis.

In terms of expenditure marketers are ready to spend about $1.8 billion on marketing that is based on the location-based services in 2015. Consequently people lying at the beach will only see beach-related advertisement.

Why is this all possible? On the one hand it is definitely the technology that makes these wonderful marketing approaches happen, but on the other hand marketers have understood, that they can get personal data from consumers when they are willing to pay either with a tangible product (such as a coupon with a discount) or an intangible product (such as meeting a friend). Therefore, the before mentioned NYT article uses "personal data" as currency, which pretty much describes what it became in our electronic world.

So the next time you are spending on the internet, make sure you spend the right currency!

Clearly it is not easy to decide whether one should take that chance of using social media in its extreme or not. And I do understand that. But as discussed it is vital to be in touch with the companies customers and probably as much important the companies prospective customers, the ones that bring extra revenue and increase the profit. Consequently no entrepreneur in todays world should doubt or even contemplate to miss out on taking part in a social network, even if that means keeping customers updated during their vacation.

Check out the video to look at some impressive data:

Video-Source: http://www.youtube.com/watch?v=QLd9q88ohUs&feature=player_embedded

Souces:
http://www.groupon.com/miami/
http://www.nytimes.com/2010/11/18/business/18sbiz.html?_r=1&ref=technology
http://www.facebook.com/places/ 
http://www.nytimes.com/2010/11/07/weekinreview/07brustein.html?_r=2&scp=1&sq=Marketing&st=cse

Influencing the customer in the right way

Marketers have to be careful which marketing techniques they use in terms of neuromarketing. The fact that marketing became a very sophisticated discipline is indisputable. Using EEG and MRI evaluations in order to understand how the customer feels, gives the marketer an unbelievable power. These tests do substitute surveys that have been done in the past in order to get the exact same information and could get falsified by the respondent.

Since science is not stoppable, every single day the human being understands the high complex functions of the brain a little more. As the Professor of Education and Human Development and director of the Mind, Brain & Education Program at the Harvard Graduate School of Education Mr. Fischer states in the frontline article the current "techniques will help scientists and educators to understand how brain and behavior work together, but we have a very long way to go.". Understanding the connection between brain function and behavior, that is the key and science is on its best way to solve its mysteries.

In neuromarketing these evaluations and understandings are used to communicate with the customer more effectively.

In my opinion eventually the issue will arise that customers start to feel manipulated and become more discreet about information they give away. New techniques clearly will help marketers to take advantage of that science, but as it has happened in previous years the customer changes. Deliberately or not is the question, but as soon as an uncomfortable feeling arises the body and the mind corrects our behavior to feel better again. This can mean that instead of reacting to a certain signal such as red color the body will "adopt" and change the effect to that color after seeing it too often.

Thus it is important for scientists and marketers to dig deeper. Neuroscientists try even to understand how much of the brain is used consciously and how much of it is used in our subconscious. Therefore it is crucial to determine where consciousness ends and another level of perception starts. As the scientists Marcus E. Raichle and Abraham Z. Snyder write in their book ("The neurology of consciousness: cognitive neuroscience and neuropathology" written by Steven Laureys and Giulio Tononi, 2009, p.82) the results of certain analysis have shown at which point the brain transcends the level of consciousness.

I think this is a very interesting and evolving area, marketers will try to understand fully. Is this right though? Is it really okay to influence someone's mind in such a deep stage so the person itself does not know he or she is deeply influenced? Even morally I would like to add that this techniques are disputable. A marketer has to distinguish between convincing a person of a certain product advertisement and manipulating that person. So the next time a picture is shown to you, think about how the colors, the heading, and maybe even the smell of the paper influences you and your decisions.