Social Media: An effective platform for digital marketing

The proliferation of online social network

The rapid growth of Web-based platform has significantly changed people's interactions and habits. As online communities can actually bring people together from across the world, real world social relationships can be migrated to the virtual world to some degree. From a customer's perspective, online social networking tend to enhance the benefits like richer and participative information sharing, cost reduction, efficiency, convenience as well as product diversity. Specifically speaking, through social network, customers are able to seek others' opinions about certain products and sharing their own's. The word of mouth effect has never been stronger.

Why social media

To ensure their market share in this digital era, firms should also engage with social media just as their customers do. From a survey conducted among market managers from big companies in Portugal, the following benefits of using social media as marketing platform are concluded:

• Improve information gathering and feedback
• User-friendly tool
• Increases knowledge
• Promotes internal and external relationships
• Supports decision making process
• Increase productivity
• Better outcome measurement

Comparing to the traditional marketing methods such as advertising, digital marketing via social media can effectively enhance communication. Not only can salesperson precisely target and reach customers, but customers can also be a co-producer for its content and spread the message among peers. Also, since direct dialogue can be easily established with customers, it is convenient for marketers to collect feedback and make improvement accordingly.

How to measure: a typology of digital media engagement

Since the investment in digital marketing evolve in parallel with perceived benefits and high level of digital marketing usage can indicate high level of digital interaction, a cluster analysis can be performed to identify groups of firms with similar digital marketing usage and benefits perception.

As shown above, it suggests four distinct digital usage/benefits profiles.

• Engagement:high usage of digital marketing and benefits from it.
• Qualification: heavy investment on digital marketing tools but low expectations regarding benefits in return.
• Discovery:lack of digital marketing usage and low benefits
• Dead-road: low commitment to digital marketing but with high expectation.

Managerial suggestions 

To gain a competitive advantage in digital marketing, firms should utilize social media as an effective platform to build long-term relationship with customers. 
Firstly, firms should maintain a high level of digital marketing usage in order to be responsive to customers' need online. Secondly, various kinds of social media can be used for different customers. For instance, Wechat and Weibo official accounts can be very powerful marketing tools when targeting Chinese customers, while Facebook and Instagram allow firms link to the rest of the world. 

From my perspective, firms should also focus on the customer engagement like create more customers' interaction rather than merely deliver the content. Besides, the feedback collection and follow-up actions are also critical for firms to effectively evaluate their performance.

Reference

http://socialmediaweek.org/jakarta/2015/02/05/5-social-media-trends-online-businessman-needs-know/

https://socwork.wisc.edu/using-social-media-social-work-student

Tiago, Maria Teresa Pinheiro Melo Borges, & Veríssimo, J. M. C. (2014). Digital marketing and social media: Why bother? Business Horizons, 57(6), 703-708.