One of the biggest dangers to businesses is the belief that something is “free”.
As we all know, there is no such thing as a free lunch. When another business gives you something for free, it’s safe to say there is a cost somewhere.
One of the speakers at the City of Sydney’s “Let’s Talk Business” social media event stated this when talking about social media: “I can’t believe all businesses aren’t on Facebook – it’s free”.
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Social media isn’t free. We all know the value services like Facebook are mining are the tastes, habits and opinions of their users.
For businesses, engaging heavily in Facebook or any other social media service hands over far more information about their customers to a third party than they themselves would be able to collect.
All of that information handed over to a service like Google or Facebook can come back to bite the business, particularly if a well cashed up competitor decides to advertise at the demographic the business caters to.
The core fallacy though is that these services are “free”. They aren’t.
Every single service comes with a time cost. Every social media expert advises the same thing: businesses have to post to their preferred service of choice at least three times a week and those posts should be strategically thought out.
That advice is right, but it costs time.
Time is a business owner, freelancer or entrepreneur’s scarcest asset. You can always rebuild your bank account but you can never recover time.
Big businesses face the same problem, but they overcome this with money by hiring people for their time. In smaller businesses, this time comes out of the proprietor’s twenty-four crowded hours each day.
The computer and internet industries are good at giving away stuff for free, in doing so they burn investors’ money and the time of their users. The social media business model hopes to pay a return to investors by trading the data users contribute in their time.
While businesses can benefit from using social media services, they have to be careful they aren’t wasting too much of their valuable time while giving away their customers to a third party.
Often when somebody looks back on their life they say, “I wish I had more time”. They’ve learned too late that asset has been wasted.
Wasting that unreplaceable asset on building someone else’s database would be a tragedy.
Paul Wallbank is one of Australia’s leading experts on how industries and societies are changing in this connected, globalised era. When he isn’t explaining technology issues, he helps businesses and community organisations find opportunities in the new economy.