There is a competing view about social media is whether businesses can fully utilize the likes of Twitter, Facebook, Google Plus and Instagram to generate revenue for the organization. That’s the goal of the organization: make money. And if that organization is a publicly-traded company, making money is imperative to the stock price growth and the attraction of more investors. But can social sites like Twitter and others give businesses the boost it needs? Below are three examples that may help convince businesses to utilize social media as a new corporate tool.
One of the biggest ways social media can help organizations is its ability to actually boost sales from its customers. For example, Dell Computers utilized Twitter to a large extent to generate an additional $6.5 million in revenue through leveraging its 1.5 million Twitter followers. Even with over $60 billion in revenue, Dell realized the potential to leverage their followers into more revenue for the organization.
Another way that social media can help organization is through connections with their customers. In the midst of GM’s crisis, the utilization of their various social and media channels (like Facebook, Twitter and video) provided some opportunities to respond to customers directly about their issues. One example in the New York Times was a customer in Alaska who tweeted to GM about why she couldn’t get the vehicle to a GM dealer since she lived on an island. GM responded by paying the ferry freight and the cost of a rental vehicle while her car was under repair. In this case, GM used social platforms to manage their customer base and take care of issues that could potentially lead to lost revenue from them.
It may be underappreciated or unknown to organizations, but social channels can really help businesses if the deal with any sort of a crisis situation. While the reputation of an organization may be intangible in nature, if damaged, can be a drag on profitability. W. Timothy Coombs wrote in the text Ongoing Crisis Communication that organizations have three rules when uses online tools for crisis situations; 1. Be present 2. Be where the action is 3. Be there before the crisis begins. Item number 3 rings true for businesses as their reputation can be a reason that customers buy your goods or services or the reason they choose your competitor.
The focus of any business is to make decisions that would provide greater sales, engage customers and protect its reputation. Each of these items can have an effect on the bottom line. For those who haven’t begun, it’s their move.