Businesses are advised to convert trading opportunities into ongoing relationships

ORGANISATIONS IGNORING social media as a business tool today are like the organisations that didn’t see much point in getting a webpage and using the internet a decade ago, says a leading analyst at Gartner, the international analyst group.

Or maybe they’re even worse.

Carol Rozwell, a Massachusetts-based vice-president for the company and its lead analyst on social media issues, says: “Gartner’s position is that social business is another wave of change that will exceed the disruptiveness of e-business and will take longer to play out.”

The difficulty, she acknowledges while on a client visit to Dublin, is that it is a nascent phenomenon, and analysts, much less organisations themselves, are still struggling to understand what this huge shift in structuring relationships and back-and-forth communication means, and will mean – and whether and how it might be converted into benefiting an organisation’s bottom line.

But – as many companies and media organisations are finding – that doesn’t mean the phenomenon can be ignored, even though many apparently are still trying. Gartner looked at US and UK data last year, and found that about half of organisations are still not allowing people to access social media through the corporate firewall. This, she thinks, is idiotic.

“One contention I have is that within the next three years, any organisation which doesn’t tend to its social media channel in the same way they do their other channels, will be viewed in the same way as if the company was ignoring their customer service [telephone] number,” she argues.

Businesses need to start to create social media strategies and usage policies, but a serious problem is that managers often have a very poor understanding of social media outlets themselves and perhaps are not the best people to be counselling employees or considering strategy.

On a new Gartner list of the top 10 things businesses get wrong about social media, No 1 is: “They have a Facebook page and think that’s the social media strategy,” she says with a laugh – though more seriously, she notes, this is actually a pretty common “strategy”.

Too many businesses focus on the social media technology. “It’s not the technology. It’s how you’re trying to improve the work you’re doing.”

And for users of social media, there’s only one focus, she says, which businesses need to understand if they are to use social media effectively – which is “what’s in it for me”.

People use sites such as Facebook and Twitter because they get something personally rewarding out of them. And Twitter users, be they individuals or organisations, gain followers by considering, “What am I doing that is interesting and of value to my followers? It’s always – what’s in it for me?”

Rozwell thinks Facebook (or the general concept of it, which as she notes may be a similar service that comes to dominate in future) as “the destination of me” is extremely powerful, with enormous potential.

She thinks it, or a similar service, will evolve into a central point from which we manage all sorts of information about ourselves, avail of services ranging from healthcare to government, and make personal purchases, and so on.

“The directionality is really the thing here. Back in the early web days, I had to go out to do things. Facebook is fundamentally the other direction. Based on my preferences, I am fed things that I am interested in.”

She’s very interested in a new Facebook career networking service called Branch Out. “It’s taking advantage of this huge population of 700 million users. It takes information you’ve probably declared in your profile and it’s using it to recruit people.

“It pulls business-relevant information. We are going to start to see different apps utilising a source of data like this – and we can see this as the world’s largest database of ‘me’.

“So if you think about making my life easier, conceptually, it makes sense.

“Of course there are all sorts of privacy and security implications, but I think there will be an interface layer around ‘me’ that mediates the information that goes to different organisations.”

But that is off in the future. For businesses right now, the business-to-consumer connection via social media is about acknowledging two things, she says. The first is to understand, “It ain’t about the brand. It’s passion about an issue or a topic.”

She gives Adidas and Nike as good examples of companies using social media tools such as Facebook. “People are not going there because the companies have introduced a new sneaker. They’re going there because of their own passion about fitness and running and so on. So, via social media, the companies are taking what was a transaction and turning it into a relationship.”

The second point, related to the first, is a term she has coined, “network sociality”, which she cheerfully concedes is one of those analyst catchphrases invented to highlight a concept.

She is careful to differentiate between what is known as the network effect (where the value of a product or service increases as more people use it) and network sociality, which she defines as interactions, talking or working, around a common passion.

Using the Nike example, this is what is happening when all those people who are passionate about a topic – fitness or running – converge around a brand, because of its affiliation with that activity.

How those relationships can be harnessed – for example, whether there is any financial benefit for a brand – is still poorly understood. We are just on the edge of seeing these relationships and interactions form, she says.

Her hunch is that the real opportunity for organisations is around how these networks coalesce. “We need social analytics to correlate activity, though – for example, are they buying more than the control group?”

But why do we want to gather online in these ways, be it to follow the tweets of a celebrity, visit a brand page on Facebook, or fundraise on Google+?

She says she is reading New York Timescolumnist David Brooks's book the Social Animaland has found it very insightful in explaining our underlying motivations for being social.

“We still have the mentality of hundreds of thousands of years ago. The tribal instinct is still very strong.”