Today’s hottest trend? Social networking. What started out as a way for ‘cool kids’ to talk to each other has now become essential part of every company’s marketing strategy.
A recent report from analyst firm IDC shows the market for enterprise social networking products will reach US$2 billion by 2012.
If your business doesn’t have a social networking presence, you’re already behind.
Shayne Tilley, marketing director for Sitepoint.com, says that as the social media space develops, businesses that are late to jump on the trend will be hit hard.
“At the moment, you get incremental gain from being in the social space. In a few years’ time I think that you will lose out if you’re not involved. Consumers will expect you’ll have a presence in things like Facebook and Twitter.”
But this sector is fast moving and constantly changing. To help you try and get ahead of the market, we’ve spoken to a range of experts to indentify the next 15 social networking trends.
1. Social networking goes mobile
One major trend that is already beginning is the move of social networking from traditional desktop computers to portable devices. Clearly, the iPhone has kick-started this trend, but with the rise of smartphones the practice is becoming more popular.
Jim Stewart, founder of SEO firm Stewart Media, says this transition gives businesses plenty of opportunities to rapidly respond to users’ queries on social networks in real-time, and this will also help the development of location-specific networks.
“We’re only seeing the start of it now, really because we’ve only had the iPhone for about 12 months, but the idea is you can send a Tweet out to people within a 25km area. If I was in the Melbourne CBD I would have a Twitter client monitoring the word ‘Melbourne’ during business hours and would have a Twitter client to respond.”
“If someone asks a question and you can help them, they’re going to remember you.”
2. True business networking goes online
The nature of Facebook and MySpace means that social networking is often thought of as just that – a space for personal relationships to be built and grow. While some business-focussed networking sites such as LinkedIn are popular, Stewart argues this is an area of real growth. He expects business people will start to behave online the way they would at a networking event, with some sites even dedicated to the practice.
“Social networking is the online form of business networking. When you go to a networking event, you don’t go there to sell stuff, you go to meet people and build brands and products in the hope you’re going to make connections.”
“The same occurs with social networking. It’s along the lines of thinking that this is a business network you’re getting involved in, therefore you should contribute so in the longer term it’s going to improve your business.”
3. Social networking search allows advertisers to target
Facebook Australia’s regional sales vice president Paul Borrud says social networking advertising will become more reliant on customisable search results, allowing businesses to target specific demographics for a product or service.
“The ability for advertisers to target people based on criteria will continue to evolve and certainly provide more value to certain type of marketers who have time sensitive updates – airlines having fare sales, things like that.”
Stewart agrees, saying companies like Google will begin to implement searches within social networks.
“I can’t see that taking off in the short-term, but I can see some sort of interface from social networks that says, ‘10 out of 50 people in your social network thought product or service ‘X’ was a good result’ or whatever. As a result, businesses need to get more involved in networks in areas where their customers are.”
4. Social networking takes on traditional email
Websites aren’t the only destinations that are introducing social networks. Experts suggest email providers are also on the way to adding social networking tool. A good example of this is the yet-to-be-released Google Wave application, which will combine email and instant messaging with elements of social networking, such as the ability to share photos, documents and videos with contacts.
Forrester Research analyst Steven Noble expects this trend to continue.
“We expect many social destinations that currently provide you with a social inbox you access via the web, where you get messages via contacts, in the future will offer an email address. You obviously have a relationship with the person you’re talking with, so it’s not spam. Unlike email which can be exploited by people who have no relationship with you.”
“Traditional email in the hands of developers can pick up social features like mapping social relationships to judge whether a message is high or low priority, or even spam.”
5. Advertisers must converse, not just sell
Social networking has been a hotbed for advertising opportunities, particularly with the rise of social profiling, where advertisements are tailored to users based on information in their individual profiles.
But Borrud says advertisers need to do more than target a market and sell to it – they’ll need to actively engage in conversations to get credibility.
“Facebook will evolve with networking, so the things that you’re seeing with us most recently around more real-time experience, I think advertising will follow suit.”
“We’re really moving on from banner advertising which is kind of web 1.0, a one way conversation. As we think about the primary way in which we offer value to marketers, it’s about engagement and brands being a part of the conversation, not shouting and taking away from the experience.”
6. Networks get smaller
The major players of the social networking world should survive according to most experts, but Jason Falls, director of social media at advertising group Doe Anderson, expects more networks will appear that are suited to sub-groups and niche demographics.
The trend of gaining as many “friends” and “followers” on these sites will disappear, he says, to be replaced by networks of close friends, family and other interesting people who add value to your network.
“At the end of the day, we only have time for so many social networks. As a result, I think the big players, (Facebook and MySpace in much of the world), will continue to separate themselves from the pack and see niche social networks evolve within their groups and similar functions. The successful ones will be purposed, targeted and relevant to a relatively small, but richly active community.”
As a result, Borrud says this will force businesses to decide where they place their focus in terms of advertising and involvement.
“That’s where it’s going to become more difficult for businesses. Where do they place their attention? Do I focus on my relationships in Twitter, or business services within LinkedIn? It’s important they research where their target market is.”
As Greg Verdino, chief strategy officer at Crayon, says: “Being Facebook friends with your mum will seem less ridiculous than following 4,000 strangers on Twitter.”
7. Why businesses will need to find the leaders of a social network
Social networks emerged as an avenue for casual chit-chat, Tilley says, so it’s no surprise that users are often prejudiced towards any advertising within social networks.
As a result, he says businesses will need to be creative in how they engage users within a social networking space, in order to avoid scaring them away.
“We’re seeing a lot more businesses trying to establish themselves in these spaces, and as you throw more corporate messages into what is generally a sociable environment it will be interesting to see how customers react.”
“You look at early adopters to things like Twitter, you’ve got a handful of influential members whose ability to influence a massive audience is quite strong, I think over time businesses will realise that person will influence purchase decisions for people who admire that individual, that admiration exists in a social space now. That has massive PR advantage.”
8. Crowd source or else!
The concept of crowd-sourcing is moving from a novelty used by some companies to a regularly expected feature of online retailers. Tilley says the use of crowd sourcing will become a necessity in a web 2.0 world.
“We’re seeing good examples of organisations giving trust in the wisdom of the crowd, allowing them to make democratic decisions on behalf of the organisation. They’ve had heavy social engagement in terms of which direction they head.”
“It’s going to be an interesting evolution; there are different schools of thought in terms of the wisdom of crowds. Some consider it to be mob mentality, and in some ways I agree with that, but avoiding people’s willingness to engage with you might be negative in the future if you’re not trusting.”
9. Get set for the rise of the social entrepreneurs
The development of new, niche networks will also provide businesses with opportunities to make money from a variety of different sources, uSocial founder Leon Hill says.
“Social networking is giving new businesses opportunities to make new products, and as social networking develops, business opportunities also increase,” he says.
“A lot of people starting businesses are generating followers on these sites, and therefore are generating a customer base obtainable at no cost, which for a lot of start-ups is a fantastic thing.”
10. Social networks connect to each other
As the social web develops more sites will begin to integrate their services with one another. Already, widgets are available that can update Facebook and Twitter at the same time, while Hill says this sector will provide opportunities for companies offering “integration services”.
“What I’m starting to see are a lot of sites starting to do partnerships. With a lot of social media sites, you can add LinkedIn profile to other sites, people are not only having social media sites on the net, but are being interlinked, so people aren’t having identities, they’re having hubs spanning dozens of sites, so that’s growing a lot, which helps more people.”
Borrud says this will impact the way companies advertise, as they will have to adopt more of a relationship with a consumer’s overall identity across several sites, rather than a direct channel of information to one particular profile.
“From an anonymous perspective from today, you have a real name attached to a real person with real information, the value I get from providing more information about me really opens up the opportunity for the friends I connect to, the value the brand gets is the relationship with someone today.”
11. Online retail harnesses the power of social networking
Noble says social networking may even take a cue from computer manufacturer Apple, which introduced a feature in its iTunes software that recommends songs based on music library history.
“This was introduced with the ‘Genius’ feature. It compares songs in your iTunes collection to songs that are most commonly used, logically that takes you to a place you can get recommendations from people who think like you, or eventually, even your friends. That is certainly difficult, but for any organisation that offers transactions online, you would increase these social features.”
12. Twitter will be sold to Google
Speculation has been rampant about the future of Twitter, especially as the site has grown substantially with millions of users but brings in no money whatsoever.
It has suffered several problems with several server crashes, as well as disappointing figures from Neilson, which showed it has a retention rate of just 40%. The company is looking to bring in revenue and improve its services, but Jason Falls said recently this process will culminate in Google buying out the micro-blogging site.
“They’ll probably do it out of the same frustration we all have with the platform – it’s so useful and good but hasn’t been improved in the least and still doesn’t work well. For a group of guys to build the single-most useful communications software and social utility in recent memory, you’d think they’d work to keep users happy and improve the service.”
“Google will not only make it work right, they’ll make it work better and add to their already ubiquitous hold on the online user experience.”
Twitter co-founder Biz Stone said recently at the Cannes Lions International Advertising Festival that the company is looking at introducing paid services for its corporate customers.
“From computer makers like Dell to companies like Whole Foods, Comcast and Jet Blue, we think we might be able to enhance the value they’re getting in exchange for some kind of fee. We’re in research mode as to what that will be like.”
Any consolidation that occurs in the industry will also likely involve former market leader MySpace. The News Corp-owned company has shed several staff members, and recently mixed up its executive board in a conscious effort to bring the company back to a “start-up culture”.
It has continued to lose members while Facebook and Twitter have grown, so it would be no surprise to see the site integrate with other services that expand its user base.
13. Online, money can buy you friendship
It seems the best advice for companies entering social networks is to be completely honest and slowly build a network of genuine, passionate friends and followers.
If that sounds a bit slow, maybe you can take a lead from one Australian company which has begun using Twitter users as a commodity that can be sold to businesses by the thousand.
uSocial chief Leon Hill says his businesses operates by examining a client’s needs, then searching out Twitter users who follow companies of a similar nature.
Hill says this service is similar to advertising services offered by Google, but believes his clients are gaining “permanent marketing tools”.
“We’re delivering high quality advertising. I’ve seen people buying clickable ads on Google, and they’re spending $3,000 before they make a sale. But if they gain followers on Twitter, they will have them as a marketing tool month-in and month-out.”
14. Don’t forget the spectators
For all the people who use social networks and will join them in the future, there are millions of others who will stay away or simply watch from the sidelines.
Todd Defren, principal at SHIFT Communication, says that businesses must know and cater for these users even if they are not actively part of any social networks.
“For all the hype about services like Twitter and Facebook, there are many more millions of consumers who don’t ‘join’, who don’t blog nor consider themselves blog readers. Yet they likely to participate quite frequently (albeit unwittingly) in social media, via Google searches. Google searches which serve up YouTube videos, blog posts, etc. Social media-savvy SEO will be an ever-more-important factor for brands to consider as they seek to expand their influence beyond the ‘cool kids’ crowd online.”
15. Defend you reputation
As your company’s presence online grows, there will be more opportunities for your brand to be thrown in the mud.
James Griffin, founder of online risk management group SR7, says businesses must be aware of what is happening to your brand online.
“It all goes back to the stigma that these sites have just young people using them and what’s said on there won’t affect your brand and company. But some organisations might be very surprised at what risks they stand for online.”
“A lot of companies or risk managers in companies believe these users are just young people, but the sites actually have employees and staff using them to talk to friends and get out there… they may say things they wouldn’t at work.”
Social networks have also blurred the divide between the social and corporate worlds, with many businesses developing policies on how their staff should go about speaking about work on sites such as Facebook.
Telstra became one of the first companies in the country to develop a policy about staff posting online about the company, after one of its contractors created a ‘Fake Stephen Conroy’ Twitter profile and insulted a company executive.
Griffin says businesses must get on top of these situations early, as the speed of the internet will allow stories to enter the media before a company even knows of a problem.
“If there was a journalist who finds something, and you don’t know it’s there, you’re in for a lot of trouble. This is why companies need to be aware of these things.”