Social Networking Tools

Do you think that social networking tools can be relevant in the workplace? Why do you think this?

Please use the reading material below

The Problem With some 1 billion members, Facebook is a very desirable Web site on which to advertise, sell, and conduct other social commerce activities. (Social commerce is the delivery of electronic commerce activities and transactions through social computing.) With its size, Facebook offers opportunities for companies to reach out to customers and conduct business transactions. What is the best way to take advantage of Facebook’s size—as well as its existing customer base—to do business? The Solutions Facebook commerce (or f-commerce) refers to commerce executed on, or influenced by, the Facebook platform. Two major types of f-commerce are emerging: commerce-on Facebook and commerce-off Facebook. Commerce-on Facebook. Commerce-on Facebook is a type of electronic commerce in which the transaction occurs completely inside Facebook. Vendors create Facebook stores for their customers, who conduct transactions without leaving Facebook. There are many examples of Facebook stores: The P&G Pampers F-Store, powered by Amazon WebStore, sold 1,000 diaper packs directly to consumers in less than one hour after the store “went live” on Facebook. ASOS, Europe’s first fully integrated F-store, makes it possible for consumers to complete purchases without ever leaving Facebook. Delta Airlines has built a complete ticketing system into its Facebook page. Although the airline allows the user to promote Delta by posting a general message on his or her Wall, it does not do much to help the user share details with friends involved in the trip, something that a Send Button could do nicely. Facebook credits are just like tokens at an arcade or amusement park. Credits are a secure way to play games and purchase virtual and digital goods on Facebook. You can buy credits using your credit card, PayPal, mobile phone, or other payment methods. For instance, Warner Brothers allows consumers to use Facebook credits to stream movies in Facebook for 30 Facebook credits ($3) per movie. Commerce-off Facebook. Commerce-off Facebook takes advantage of Facebook’s Open Graph, which allows shoppers to sign in to Facebook from any Web site with any computing device (e.g., laptop, netbook, phone). Merchant integration with Facebook works in five ways: Facebook-enabled Web sites, Facebook in-store retail, Facebook-initiated selling, Facebook check-in deals, and Facebook mobile ads. Facebook-enabled Web sites are traditional Web sites and e-commerce sites that integrate with Facebook to offer customers a Facebook experience while shopping or researching purchases. Brands can bring the Facebook experience to their Web sites, tapping users’ connections and interests to support the purchasing process. The simplest examples involve using social plugins, which include the Like Button, Send Button, Subscribe Button, Recommendations, Login Button, and many others. The Like Button is the most common plugin, and it is usually regarded as a content-sharing device. However, when it is used in conjunction with a product page, it can provide peer support by displaying the names and profile images of people who have Liked the product. For marketers and producers, the most appealing feature of the Like Button is the fact that it also highlights any of the user’s Facebook friends who have Liked the product. In Facebook in-store retail, brick-and-mortar retailers integrate with Facebook to offer customers a Facebook experience while shopping in their stores. For instance, Macy’s Magic Fitting Room is a Facebook-connected fitting room equipped with a camera-enhanced 72-inch mirror and an iPad that allows customers to try on clothes and then share the experience with their Facebook friends. With Facebook-initiated selling, businesses can set up a storefront for free on their Facebook pages. Customers begin the shopping process on Facebook and are then directed to the business’s e-commerce pages at some point to complete the purchase process. For example, Best Buy keeps shoppers in the Facebook environment and takes advantage of its social features while they are there. Best Buy’s store app is labeled “Shop 1 Share.” Users can search or browse for products. When they find something that interests them, they have two options: Ask Friends or Shop Now. Ask Friends leads to a Wall post asking about the product. Interestingly, Best Buy makes Ask Friends much more noticeable than Shop Now, which takes the user to the product page at www.bestbuy.com for the shopping cart and checkout process. The Facebook check-in deals program allows local retailers to drive traffic to their stores by offering special discounts to consumers who check in to their location with Facebook Places on their mobile phones. For example, The Gap ran a promotion in which it leveraged check-in deals by offering a free pair of blue jeans to the first 10,000 consumers who checked in at Gap stores. Similarly, Mazda UK offered a 20 percent discount for the Mazda X5 for check-in deals when Facebook Places launched in the United Kingdom. In October 2012, Facebook launched mobile ads. Several of Facebook’s large advertising clients who used the mobile ads indicated that these ads can be used to develop e-commerce on Facebook, turning the social network into a mobile shopping and sales service. For example, Fab.com tested the service with Fab’s shopping app (over Facebook) and noted that the app was 5 times more effective than any other mobile download channel that the company had ever used. The Results F-commerce is still in its infancy. In 2007, Facebook initiated Project Beacon, which collected e-commerce activity on third-party sites and announced a user’s purchases on his or her friends’ news feeds. Facebook quickly withdrew from that privacy nightmare. However, the damage done to its reputation for freely dispersing user data still deters f-commerce. Many Facebook users have become so accustomed to Facebook’s aggressive data-sharing policies that they automatically assume the worst. In fact, studies have shown that a majority of Facebook users have concerns about Facebook’s privacy and security. Experienced e-commerce managers also perceive problems with Facebook itself. Facebook has relatively slow page loads and a smaller page size due to its advertising and navigation. Analysts wonder why customers would bother shopping through Facebook when a faster and better experience is only a browser tab away, at the vendor’s e-commerce site. Facebook advertising is also an issue. No matter how you structure your f-commerce store, the user will still be subjected to targeted Facebook ads during the buying process. Going further, many Web marketers question the social nature of shopping itself. There is a widespread belief that people visit Facebook to catch up with their friends, not to be sold products. However, a J. Walter Thompson study reported that 48 percent of millennials (aged 20 to 33) would like the places where they shop to give them the ability to buy directly on Facebook. In January 2012, P&G announced that the company was scaling back its $10 billion annual ad budget (primarily in traditional media) to take advantage of free impressions offered by Facebook in the form of Likes and status updates. Several months later, General Motors canceled its entire $10 million Facebook ad budget. The companies made these decisions for different reasons: GM was not convinced that Facebook ads are effective, and P&G was looking for free media advertising efficiencies. Some industry analysts contend that advertising on Facebook is not as effective for some advertisers as advertising on search engine Web sites. Their reasoning is that people searching for information on purchase decisions are better targets for ads than are people checking out messages from friends. They also argue that advertising on Facebook is problematic because it interrupts personal conversations with impersonal branding. WordStream (www.wordstream.com), a search marketing management company, compared advertising on Google with advertising on Facebook. WordStream’s findings suggest that Facebook is a much less effective ad medium than Google. Let’s take a look at the findings. Total Reach Facebook: 51 percent of all Internet users Google: 90 percent of all Internet users Fourth Quarter Revenues, 2012 Facebook: $5 billion Google: $14 billion Click-Through Rates Facebook: 0.051 percent Google: 0.4 percent Average: 0.1 percent The click-through rate of an advertisement is the number of clicks on an ad divided by the number of times the ad is shown, expressed as a percentage. The average click-through rate for an ad on the Internet is 0.1 percent. That is, an ad that appears 10,000 times on the Internet would be clicked on 10 times. An ad that is shown 10,000 times on Facebook would be clicked on 5 times. In contrast, if the same ad were displayed 10,000 times on Google, it would be clicked on 40 times. Thus, Google ads receive 8 times as many clicks as ads on Facebook, which represents a significant competitive advantage. Regardless of the pros and cons of f-commerce, however, modern businesses must acknowledge one overwhelming fact: Facebook is where the customers are, and they should be able to buy wherever and whenever they like. Today, almost 70 percent of companies conduct transactions on or through Facebook. Sources: Compiled from P. Rooke, “Why Is Facebook’s E-Commerce Offering So Disappointing?” GigaOM.com, February 17, 2013; J. Edwards, “Facebook Is Building a Mobile E-Commerce Platform—And Advertisers Who’ve Seen It Love It,” Business Insider, January 30, 2013; O. St. John, “Facebook Commerce a Hit with Small Retailers,” USA Today, September 24, 2012; H. Elliott, “GM Retools: Goodbye Facebook, Hello Manchester United,” Forbes, May 31, 2012; J. Edwards, “Here’s the Real Reason GM Pulled $10 Million in Ads from Facebook,” Business Insider, May 29, 2012; J. Edwards, “Facebook’s Worst Nightmare: After GM, Here’s How the Other Dominoes Could Fall,” Business Insider, May 15, 2012; J. Edwards, “Data: Google Totally Blows Away Facebook on Ad Performance,” Business Insider, May 15, 2012; J. Corpus, “F-Commerce for Hollywood: Turning Fans into Customers,” Forbes, September 19, 2011; J. Ente, “The Beginner’s Guide to Facebook Commerce,” Mashable, July 14, 2011; E. Savitz, “Attention Facebook Shoppers: Get Ready for F-Commerce,” Forbes, June 27, 2011; J. Hird, “101 Examples of F-Commerce,” EConsultancy, May 19, 2011; J. Diner, “F-Commerce, the Arrival of the Facebook Consumer,” ClickZ.com, May 10, 2011; www.facebook.com, accessed February 9, 2013. Questions 1. What are the advantages for a business of conducting commerce on Facebook? The disadvantages? 2. What are the advantages for customers of conducting commerce on Facebook? The disadvantages? What We Learned from This Case Humans are social individuals; therefore, human behavior is innately social. Humans typically orient their behavior around other members of their community. As a result, people are sensitive to the behavior of people around them, and many of their decisions are influenced by their social context. Traditional information systems support organizational activities and business processes and concentrate on cost reductions and productivity increases. A variation of this traditional model, social computing, is a type of IT that combines social behavior and information systems to create value. Social computing is focused on improving collaboration and interaction among people and on encouraging user-generated content. Significantly, in social computing, social information is not anonymous. Rather, it is important precisely because it is linked to particular individuals, who in turn are linked to their own networks of individuals. Social computing makes socially produced information available to everyone. This information may be provided directly, as when users rate a movie (e.g., at Rotten Tomatoes), or indirectly, as with Google’s PageRank algorithm, which sequences search results. In social computing, users, rather than organizations, produce, control, use, and manage content via interactive communications and collaboration. As a result, social computing is transforming power relationships in organizations. Employees and customers are empowered by their ability to use social computing to organize themselves. Thus, social computing can influence people in power to listen to the concerns and issues of ordinary people. Organizational customers and employees are joining this social computing phenomenon, with serious consequences for most organizations. Significantly, most governments and companies in modern developed societies are not prepared for the new social power of “ordinary people.” Today, managers, executives, and government officials can no longer control the conversation around policies, products, and other issues. In the new world of business and government, organizational leaders will have to demonstrate authenticity, even-handedness, transparency, good faith, and humility. If they do not, customers and employees may distrust them, to potentially disastrous effects. For example, customers who do not like a product or service can quickly broadcast their disapproval. Another example is that prospective employees do not have to take their employers at their word for what life is like at their companies—they can find out from people who already work there. A final example is that employees now have many more options to start their own companies, which could compete with their former companies. As you see from these examples, the world is becoming more democratic and reflective of the will of ordinary people, enabled by the power of social computing. On the one hand, social power can help keep a company vital and can enable customers and employee activists to become a source of creativity, innovation, and new ideas that will move a company forward. On the other hand, companies that show insensitivity toward customers or employees quickly find themselves on a downward slide. Consider the following examples: Hershey faced public relations problems in August 2011 when 400 college students revolted, walking off their jobs. These students were hired through a foreign-exchange program sponsored by the U.S. State Department, and they did not like the stress of working in a candy-packing factory, sometimes on all-night shifts. The students, who came from China, Nigeria, Turkey, and Ukraine, were excellent communicators, so they used YouTube, Facebook, and other tools to bring attention to their plight. In 2011, Adidas came under attack in New Zealand when fans of the country’s hugely popular national rugby team were outraged to learn that Adidas team jerseys were being sold for significantly higher prices in their country than in other countries. Fans discovered this information by researching product prices in New Zealand and the United States online. Armed with this information, they organized protests. Soon, national news programs picked up coverage of the protest and of Adidas’s slow response to the consumer outrage. Customers started returning Adidas clothing to stores in disgust, and employees felt so threatened by the populace that they removed Adidas’s logos from their company vehicles. In the Netherlands in 2011, a social media campaign against bankers’ bonuses focused on the Amsterdam-based company ING. Bank customers began threatening en masse to withdraw deposits. In response, CEO Jan Hommen voluntarily waived his own upcoming $1.8 million bonus and then ordered all company directors to do the same. Social computing is exploding worldwide, with China having the world’s most active social media population. A McKinsey survey found that 91 percent of Chinese respondents reported that they had visited a social media site in the previous six months, compared with 70 percent in South Korea, 67 percent in the United States, and 30 percent in Japan. Interestingly, the McKinsey survey found that social media has a greater influence on purchasing decisions for Chinese consumers than for consumers anywhere else in the world. Social computing is also increasing dramatically in Africa. Facebook in particular is growing rapidly in African countries, and it is the dominant social network in most of them. However, Facebook does have rivals in Africa, including the following: In South Africa, Mxit (www.mxit.com) has 10 million active users, more than double Facebook’s number. In Ghana, a mobile social network called Saya.im (www.saya.im) gained more than 50,000 members in six weeks after the site launched. In Kenya, a mobile social network called iCow (www.icow.co.ke) provides farmers and other members with livestock management and other agricultural information. Businesses today are using social computing in a variety of innovative ways, including marketing, customer relationship management, and human resource management. In fact, so many organizations are competing to use social computing in as many new ways as possible that an inclusive term for the use of social computing in business has emerged: social commerce. Because social computing is facilitated by Web 2.0 tools and sites, you begin this chapter by examining these technologies. You then turn your attention to a diverse number of social commerce activities, including shopping, advertising, market research, customer relationship management, and human resource management. You conclude by studying the risks and concerns associated with social computing. When you complete this chapter, you will have a thorough understanding of social computing and the ways in which modern organizations use this technology. You will be familiar with the advantages and disadvantages of social computing as well as the risks and rewards it can bring to your organization. For example, most of you already have pages on social networking sites, so you are familiar with the positive and negative features of these sites. This chapter will enable you to apply this knowledge to your organization’s efforts in the social computing arena. You will be in a position to contribute to your organization’s policies on social computing. You will also be able to help your organization design its strategy to utilize social computing. Significantly, social computing can help you start your own business. For example, many entrepreneurs have developed successful businesses on Facebook, as you see in IT’s About Business 9.1. As we noted earlier, social computing is facilitated by Web 2.0 tools and sites. In the next section, you will learn about Web 2.0 tools such as AJAX, tagging, Really Simple Syndication, blogs, microblogs, and wikis. You will also learn about two major types of Web 2.0 sites, social networking sites and mashups. IT’s [about business]: 9.1 Tiger Tans and Gifts Lisa Keiling owns a tanning salon in Wedowee, Alabama, that does very well from January through May. Unfortunately, during the rest of the year the demand for tanning beds is extremely low. In fact, the demand is so low that Lisa had to try some new strategies to bring in some income. First, she opened a small hunting/fishing shop in a room where she formerly kept a tanning bed. Even though hunting and fishing are very popular in Wedowee, that idea did not work well. Her next strategy was to sublease part of her space to a hairdresser. This idea generated a lot of extra revenue, and it became a very important part of her business. In fact, during the months when tanning was minimal, the hairdressing business became Lisa’s primary source of income. Despite the success of the hairdressing venture, however, Lisa still needed another source of revenue to make it through the slow times. After searching around for ideas for a small business, she found a machine that cut out vinyl designs that could be placed on cups, purses, bowls, plates, frames, and any other hard surface. With this machine, she could customize just about anything that she could imagine! Lisa purchased the machine and taught herself how to use it. Once Lisa became proficient at producing vinyl designs, she needed a strategy to promote her new enterprise. She realized she needed to use the Internet, but she did not feel comfortable creating a Web site herself. However, Lisa was very familiar with Facebook. Because she had lived in the area for a long time and already had many “friends” on Facebook, the site was a natural fit to advertise her new business. Lisa first created an account for her company. As she designed each new product, she posted a picture of it on Facebook and “liked” it herself from her personal page. Other people did the same because they liked the product. Her new creations were going viral in small-town Wedowee, and she was attracting new business! For Lisa, the vinyl designs venture and Facebook combined to save her business during the winter months. If you visit her Facebook page, you will see that she is very active online every day. Her page made it possible for her customers to contact her and to purchase her products without having to come to her store. Today, Lisa is exploring the option of adding a Web site to streamline the ordering process. This site would be synced with her Facebook page, and it would provide customers with a single location to place their orders. Lisa hopes that all of her efforts will continue to make her business a success. Her long-term goal is for the custom gift shop to function as her main source of income, with the tanning salon providing only supplemental income. Sources: Compiled from authors’ personal interviews with Lisa Keiling. Questions 1. What other actions could Lisa take on Facebook to “get the word out” about her custom gifts? 2. Does Lisa really need a Web site for her business, or is her Facebook page sufficient? (Hint: Can she take orders via her Facebook page?) 9.1: Web 2.0 The World Wide Web, which you learned about in Chapter 6, first appeared in 1990. Web 1.0 was the first generation of the Web. We did not use this term in Chapter 4 because there was no need to say “Web 1.0” until Web 2.0 emerged. The key developments of Web 1.0 were the creation of Web sites and the commercialization of the Web. Users typically had minimal interaction with Web 1.0 sites. Rather, they passively receive information from those sites. Web 2.0 is a popular term that has proved difficult to define. According to Tim O’Reilly, a noted blogger, Web 2.0 is a loose collection of information technologies and applications, plus the Web sites that use them. These Web sites enrich the user experience by encouraging user participation, social interaction, and collaboration. Unlike Web 1.0 sites, Web 2.0 sites are not so much online places to visit as Web locations that facilitate information sharing, user-centered design, and collaboration. Web 2.0 sites often harness collective intelligence (e.g., wikis); deliver functionality as services, rather than packaged software (e.g., Web services); and feature remixable applications and data (e.g., mashups). In the following sections, we discuss six Web 2.0 information technology tools, which include AJAX, tagging, Really Simple Syndication, blogs, microblogs, and wikis. We then turn our attention to the two major types of Web 2.0 sites, social networking sites and mashups. Ajax Most Web 2.0 applications have rich, user-friendly interfaces based on AJAX. AJAX is a Web development technique that enables users to reload portions of Web pages with fresh data instead of having to reload the entire Web page. This process speeds up response time and increases user satisfaction. Tagging A tag is a keyword or term that describes a piece of information—for example, a blog, a picture, an article, or a video clip. Users typically choose tags that are meaningful to them. Tagging allows users to place information in multiple, overlapping associations rather than in rigid categories. For example, a photo of a car might be tagged with “Corvette,” “sports car,” and “Chevrolet.” Tagging is the basis of folksonomies, which are user-generated classifications that use tags to categorize and retrieve Web pages, photos, videos, and other Web content. One specific form of tagging, known as geotagging, refers to tagging information on maps. For example, Google Maps allows users to add pictures and information, such as restaurant or hotel ratings, to maps. Therefore, when users access Google Maps, their experience is enriched because they can see pictures of attractions, reviews, and things to do, posted by everyone and all related to the map location they are viewing. Really Simple Syndication Really Simple Syndication (RSS) is a Web 2.0 feature that allows you to receive the information you want (customized information), when you want it, without having to surf thousands of Web sites. RSS allows anyone to syndicate (publish) his or her blog, or any other content, to anyone who has an interest in subscribing to it. When changes to the content are made, subscribers receive a notification of the changes and an idea of what the new content contains. Subscribers can then click on a link that will take them to the full text of the new content. For example, CNN.com provides RSS feeds for each of its main topic areas, such as world news, sports news, technology news, and entertainment news. NBC uses RSS feeds to allow viewers to download the most current version of shows such as Meet the Press and NBC Nightly News. You can find thousands of Web sites that offer RSS feeds at Syndic8 (www.syndic8.com) and NewsIsFree (www.newsisfree.com). Figure 9.1 illustrates how to search an RSS and locate RSS feeds. To use RSS, you can utilize a special newsreader that displays RSS content feeds from the Web sites you select. Many such readers are available, several of them for free. Examples are AmphetaDesk (www.disobey.com/amphetadesk) and Pluck (www.pluck.com). In addition, most browsers have built-in RSS readers. For an excellent RSS tutorial, visit www.mnot.net/rss/tutorial. Blogs A weblog (blog for short) is a personal Web site, open to the public, in which the site creator expresses his or her feelings or opinions via a series of chronological entries. Bloggers—people who create and maintain blogs—write stories, convey news, and provide links to other articles and Web sites that are of interest to them. The simplest method of creating a blog is to sign up with a blogging service provider, such as www.blogger.com (now owned by Google), www.xanga.com (see Figure 9.2), and www.sixapart.com. The blogosphere is the term for the millions of blogs on the Web. Many companies listen to consumers in the blogosphere who express their views on the companies’ products. Marketers refer to these views as consumer-generated media. For example, Nielsen (www.nielsen-online.com) “mines” the blogosphere to provide information for its clients in several areas. Nielsen helps clients find ways to serve potential markets, ranging from broad-based to niche markets. The company also helps clients detect false rumors before these rumors appear in the mainstream media, and it gauges the potency of a marketing push or the popularity of a new product. Although blogs can be very useful, they also have shortcomings. Perhaps the primary value of blogs is their ability to bring current, breaking news to the public in the fastest time possible. Unfortunately, in doing so, bloggers sometimes cut corners, and their blogs can be inaccurate. Regardless of their various problems, however, blogs have transformed the ways in which people gather and consume information. FIGURE 9.1: The Web site of National Public Radio (NPR) with RSS toolbar aggregator and search function. (Courtesy of NPR. Used with permission.) Microblogging Microblogging is a form of blogging that allows users to write short messages (or capture an image or embedded video) and publish them. These messages can be submitted via text messaging from mobile phones, instant messaging, e-mail, or simply over the Web. The content of a microblog differs from that of a blog because of the limited space per message (usually up to 140 characters). The most popular microblogging service is Twitter. FIGURE 9.2: Xanga organizes blogs by common content (dating, beauty, food, and more) to help readers find multiple blogs on one Web site. Twitter is a free microblogging service that allows its users to send messages and read other users’ messages and updates, known as tweets. Tweets are displayed on the user’s profile page and delivered to other users who have signed up to receive them. Twitter is becoming a very useful business tool. It allows companies to quickly share information with people interested in their products, thereby creating deeper relationships with their customers. Businesses also use Twitter to gather real-time market intelligence and customer feedback. As an individual user, you can use Twitter to inform companies about your experiences with their business, offer product ideas, and learn about great offers. It is possible to use Twitter for the wrong reasons, however. IT’s About Business 9.2 illustrates how Twitter was used in the 2012 Mexican general elections. IT’s [about business]: 9.2 Twitter Misuse in the Mexican Presidential Election In Mexico’s 2012 presidential campaign, the two top contenders engaged in a Twitter spam war, employing software robots (automated programs) that were designed to deliver negative tweets about opposing candidates and disrupt their social media efforts. This large-scale political spamming could foreshadow online efforts that campaigners in other countries will increasingly resort to. One reason why Twitter was particularly prominent during this election is that Mexicans were already using Twitter as a source of information about events in northern areas of the country, where fear of violent retribution prevents news outlets from reporting about drug cartels. In the presidential campaign, one political party in particular—the Institutional Revolutionary Party, or PRI—came under fire for unleashing tens of thousands of bots, or user accounts programmed to automatically tweet specific words and phrases. At the same time, they organized large groups of human Twitter users to simultaneously publish the same message. Their objective was to increase the likelihood that the message would land on Twitter’s list of “trending” topics. Spamming often makes use of hashtags—words and run-on phrases preceded by a hash sign (like #thishashtagexample). Twitter users can apply hashtags to their tweets to make them easily searchable, a strategy that has proved useful for groups like Occupy Wall Street. The PRI’s candidate, Pena Nieto, was both the target of hashtag organization and a possible beneficiary of hashtag mischief. During the spring of 2012, an anti-Pena Nieto hashtag emerged, #YoSoy132 (I am 132), after his campaign and several news outlets claimed that protesters at a campaign event at a university in Mexico City were not really students and had been planted by opposing parties. In response, 131 students who claimed to have attended the event posted a video on YouTube in which they displayed their student IDs and lashed out at the media coverage. The video launched a movement centered on the hashtag and variations of it, all of which implied that its user was the figurative 132nd protester. Before long, however, Pena Nieto supporters adopted that hashtag, and they added it to messages that praised him. All three dominant political parties have used bots in various elections at the national and state levels in Mexico. Regardless of whether they employed bots, however, all three parties have deployed their young supporters to social networks. It is often difficult to determine whether their actions constitute honest political activism or spam. Reports of similar politically motivated spamming have appeared in other countries, including Russia, Syria, and the United States. For example, in February 2013, U.S. Congressman Steve Stockman accused supporters of the anti-gun violence campaign of creating fake people on Twitter to post spam messages in support of stricter gun-control regulations. For its part, Twitter states clearly that spam is against its rules, citing 20 separate examples of behaviors it considers to be spamming. In fact, Twitter engineers are trying to proactively reduce spam. For instance, Twitter collects data that could reveal malicious or abusive activity. It filed a lawsuit in the United States against five of the most aggressive spammers and providers of spamming tools. But Twitter also admits in its terms of service that ideas concerning what constitutes spamming will evolve as Twitter responds to new tricks and tactics employed by spammers. And the results of the election? Pena Nieto won the election and became the President of Mexico. Sources: Compiled from M. Weisbrot, “Irregularities Reveal Mexico’s Election Far From Fair,” Common Dreams (commondreams.org), March 19, 2013; R. Griffith, “The Dark Side of Twitter,” The Potomac Institute Cyber Center, July 11, 2012; B. Gottlieb, “Mexico Elections: Reactions to Pena Nieto’s Victory,” The Washington Post, July 2, 2012; N. Flannery, “Mexico Journal: Twitter, Televisa, and the 2012 Election,” Forbes, June 30, 2012; M. Orcutt, “Twitter Mischief Plagues Mexico’s Election,” MIT Technology Review, June 21, 2012; “#YoSoy132: Mexican Elections, Media, and Immigration,” The Huffington Post, June 7, 2012; N. Flannery, “Twittocracy: Will Twitter and Social Media Change the Outcome of Mexico’s Election?” Forbes, May 3, 2012; Questions 1. Was Twitter really misused in the Mexican general election? Or, was the use of Twitter a legitimate campaign tactic? Support your answer. 2. Describe how any political campaigns could use Twitter to monitor the progress of the campaign. (Hint: Consider polling.) Wikis A wiki is a Web site made up entirely of content posted by users. Wikis have an “edit” link on each page that allows any user to add, change, or delete material, thus fostering easy collaboration. Wikis take advantage of the combined input of many individuals. Consider Wikipedia (www.wikipedia.org), an online encyclopedia that is the largest existing wiki. Wikipedia contains more than 3.4 million articles in English, which get a combined total of nearly 500 million views every day. Wikipedia relies on volunteer administrators who enforce a neutral point of view, and it encourages users to delete copy that displays a clear bias. Nevertheless, there are still major debates over the reliability and accuracy of Wikipedia articles. Many educators will not allow students to cite references from Wikipedia because Wikipedia content is of uncertain origin. Moreover, Wikipedia does not provide any quality assessment or fact checking by experts. Therefore, academics and others still have major concerns about the accuracy of user-provided content. Organizations use wikis in several ways. In project management, for example, wikis provide a central repository for capturing constantly updated product features and specifications, tracking issues, resolving problems, and maintaining project histories. In addition, wikis enable companies to collaborate with customers, suppliers, and other business partners on projects. Wikis are also valuable in knowledge management. For example, companies use wikis to keep enterprise-wide documents, such as guidelines and frequently asked questions, accurate and current. Social Networking Web Sites A social network is a social structure composed of individuals, groups, or organizations linked by values, visions, ideas, financial exchange, friendship, kinship, conflict, or trade. Social networking refers to activities performed using social software tools (e.g., blogging) or social networking features (e.g., media sharing). A social network can be described as a map of all relevant links or connections among the network’s members. For each individual member that map is his or her social graph. Mark Zuckerberg of Facebook originally coined this term to refer to the social network of relationships among users of Facebook. The idea was that Facebook would take advantage of relationships among individuals to offer a richer online experience. Social networks can also be used to determine the social capital of individual participants. Social capital refers to the number of connections a person has within and between social networks. Participants congregate on social networking Web sites where they can create their own profile page for free and on which they can write blogs and wikis; post pictures, videos, or music; share ideas; and link to other Web locations they find interesting. Social networkers chat using instant messaging and Twitter, and they tag posted content with their own keywords, making content searchable and facilitating interactions and transactions. Social networkers converse, collaborate, and share opinions, experiences, knowledge, insights, and perceptions with one another. They also use these Web sites to find like-minded people online, either to pursue an interest or a goal or just to establish a sense of community among people who may never meet in the real world. Table 9.1 shows the variety of online social networking platforms. Social networking Web sites allow users to upload their content to the Web in the form of text, voice, images, and videos. Table 9.1: Categories of Social Networking Web Sites Socially oriented: Socially focused public sites, open to anyone Facebook (www.facebook.com) Google Orkut (www.orkut.com) Google1 (https://plus.google.com) Hi5 (www.hi5.com) Professional networking: Focused on networking for business professionals LinkedIn (www.linkedin.com) Media sharing Netcasting includes podcasting (audio) and videocasting (audio and video). For example, educational institutions use netcasts to provide students with access to lectures, lab demonstrations, and sports events. In 2007, Apple launched iTunes U, which offers free content provided by major U.S. universities such as Stanford and MIT. Web 2.0 media sites allow people to come together and share user-generated digital media, such as pictures, audio, and video. ○ Video (Amazon Video on Demand, YouTube, Hulu, Facebook) ○ Music (Amazon MP3, Last.fm, Rhapsody, Pandora, Facebook, iTunes) ○ Photographs (Photobucket, Flickr, Shutterfly, Picasa, Facebook) Communication Blogs: Blogger, LiveJournal, Open Diary, TypePad, WordPress, Vox, Expression Engine, Xanga Microblogging/Presence applications: Twitter, Plurk, Tumblr, Yammer, Qaiku Collaboration: Wikis (Wikimedia, PBworks, Wetpaint) Social bookmarking (or social tagging): Focused on helping users store, organize, search, and manage bookmarks of Web pages on the Internet Delicious (www.delicious.com) StumbleUpon (www.stumbleupon.com) Google Reader (http://reader.google.com) CiteULike (www.citeulike.com) Social news: Focused on user-posted news stories that are ranked by popularity based on user voting Digg (www.digg.com) Chime.in (http://chime.in) Reddit (www.reddit.com) Events: Focused on alerts for relevant events, people you know nearby, etc. Eventful (www.eventful.com) Meetup (www.meetup.com) Foursquare (www.foursquare.com) Virtual meeting place: Sites that are essentially three-dimensional worlds, built and owned by the residents (the users) Second Life (www.secondlife.com) Interesting New Social Networks Empire Avenue (www.empireavenue.com) is a social exchange network where members invest virtual currency in people and brands that interest them. Color (www.color.com) is a free mobile app that creates an instant social network based on users’ locations and proximity to others. Users can instantly share images, videos, and text conversations with others nearby. Foursquare (http://foursquare.com) is a location-based mobile service that enables participants to share their location with friends by checking in via a smartphone app. Hunch (www.hunch.com) maps people’s interests by asking them a series of questions. The site creates a “taste graph,” which tracks everything that a user likes and dislikes. Online Marketplaces for Microjobs For example, TaskRabbit (www.taskrabbit.com) and Zaarly (www.zaarly.com) enable people to farm out chores to a growing number of temporary personal assistants. Thousands of unemployed or underemployed workers use these sites. The part-time or full-time tasks are especially popular with stay-at-home moms, retirees, and students. Workers choose their jobs and negotiate their own rates. Enterprise Social Networks Business-oriented social networks can be public, such as LinkedIn.com. As such, they are owned and managed by an independent company. However, an increasing number of companies have created in-house, private social networks for their employees, former employees, business partners, and/or customers. Such networks are “behind the firewall” and are often referred to as corporate social networks. Employees utilize these networks to create connections that allow them to establish virtual teams, bring new employees up to speed, improve collaboration, and increase employee retention by creating a sense of community. Employees are able to interact with their coworkers on a level that is typically absent in large organizations or in situations where people work remotely. Corporate social networks are used for many processes, including Networking and community building, both inside and outside an organization Social collaboration: collaborative work and problem solving using wikis, blogs, instant messaging, collaborative office, and other special-purpose Web-based collaboration platforms; for example, see Laboranova (www.laboranova.com) Social publishing: employees and others creating either individually or collaboratively, and posting contents—photos, videos, presentation slides, and documents—into a member’s or a community’s accessible-content repository such as YouTube, Flickr, SlideShare, and DocStoc Social views and feedback Social intelligence and social analytics: monitoring, analyzing, and interpreting conversations, interactions, and associations among people, topics, and ideas to gain insights. Social intelligence is useful for examining relationships and work patterns of individuals and groups and for discovering people and expertise Take IBM as an example. With more than 426,000 employees dispersed across 170 countries, more than 100,000 contractors, and a broad range of business partners and customers, IBM has no choice but to be a social business. In fact, IBM has become the largest corporate consumer of social technologies. On any given day, 50 percent of IBMers regularly work away from traditional IBM offices. Some of them work at home, while others are mobile workers. To enable its social networking, IBM has deployed Social Blue (formerly Beehive), an internal social networking site that provides IBM employees with a rich connection to the people they work with on both a personal and a professional level. Social Blue helps employees make new connections, track current friends and coworkers, and renew contacts with people they have worked with in the past. When employees join Social Blue, they are assigned a profile page. They can then use the status message field and the free-form “About Me” section of this page to let other people at IBM know where they are and what they are doing. Employees can also use Social Blue to post photos, create lists, and organize events. If users are hosting an event, they can create an event page in Social Blue and invite people to attend. Another benefit of Social Blue is that employees can use it to create top-five lists, called “hive fives,” to share their thoughts on any business-related topic they are passionate about. Social Blue also helps employees prepare for conference calls. If users do not know the other participants, they can check out their Social Blue profiles before the call and find out if they have common interests, either work related or recreational, or colleagues. In addition to social goals, the Social Blue team created the site to help IBM employees meet the challenge of building relationships that are vital to working in large, distributed enterprises. Social Blue helps project leaders find people with the necessary skills for their projects. Mashups A mashup is a Web site that takes different content from a number of other Web sites and mixes them together to create a new kind of content. The launch of Google Maps is credited with providing the start for mashups. A user can take a map from Google, add his or her data, and then display a map mashup on his or her Web site that plots crime scenes, cars for sale, or anything else (see Figure 9.3). FIGURE 9.3: Google Maps (www.googlemaps.com) is a classic example of a mashup. In this case, Google Maps is pulling in information from public transportation Web sites to provide the customer with transit directions. There are many examples of mashups (for a complete list of mashups, see www.programmableweb.com): Craigslist developed a dynamic map of all available apartments in the United States that are listed on their Web site (www.housingmaps.com). Everyblock.com is a mashup of Web services that integrates content from newspapers, blogs, and government databases to inform citizens of cities such as Chicago, New York, and Seattle about what is happening in their neighborhoods. This information includes criminal activities, restaurant inspections, and local photos posted on Flickr. before you go on... 1. Differentiate between blogs and wikis. 2. Differentiate between social networking Web sites and corporate social networks. 9.2: Fundamentals of Social Computing in Business Social computing in business, or social commerce, refers to the delivery of electronic commerce activities and transactions through social computing. Social commerce also supports social interactions and user contributions, allowing customers to participate actively in the marketing and selling of products and services in online marketplaces and communities. With social commerce, individuals can collaborate online, obtain advice from trusted individuals, and find and purchase goods and services. Below we list a few examples of social commerce: Disney allows people to book tickets on Facebook without leaving the social network. PepsiCo gives a live notification when its customers are close to physical stores (grocery, restaurants, gas stations) that sell Pepsi products. The company then uses Foursquare to send them coupons and discount information. Table 9.2: Potential Benefits of Social Commerce Benefits to Customers Better and faster vendor responses to complaints, because customers can air their complaints in public (on Twitter, Facebook, and YouTube) Customers can assist other customers (e.g., in online forums) Customers’ expectations can be met more fully and quickly Customers can easily search, link, chat, and buy while staying on a social network’s page Benefits to Businesses Can test new products and ideas quickly and inexpensively Learn a lot about their customers Identify problems quickly and alleviate customer anger Learn about customers’ experiences via rapid feedback Increase sales when customers discuss products positively on social networking site Create better marketing campaigns and brand awareness Use low-cost user-generated content, for example, in marketing campaigns Get free advertising through viral marketing Identify influential brand advocates and reward them Mountain Dew attracts video game lovers and sports enthusiasts via Dewmocracy contests (discussed later in the chapter). The company also encourages the most dedicated community members to contribute ideas on company products. Levi’s advertises on Facebook by enabling consumers to populate a “shopping cart” based on what their friends think they would like. Wendy’s uses Facebook and Twitter to award $50 gift cards to people who submit the funniest and quirkiest responses to various challenges. Social commerce offers numerous benefits to both customers and vendors, as described in Table 9.2. Despite all of its benefits, social computing does involve risks. It is problematic, for example, to advertise a product, brand, or company on social computing Web sites where content is user generated and is not edited or filtered. Companies that employ this strategy must be willing to accept negative reviews and feedback. Of course, negative feedback can be some of the most valuable information that a company receives, if it utilizes this information properly. Companies that engage in social computing are always concerned with negative posts. For example, when a company creates a Facebook business page, by default the site allows other members of the Web site—potentially including disgruntled customers or unethical competitors—to post notes on the firm’s Facebook Wall and to comment on what the firm has posted. Going further, if the company turns off the feature that lets other users write on its Wall, people may wonder what the company is afraid of. The company will also be eliminating its opportunity to engage in great customer conversations, particularly conversations that could market the firm’s products and services better than the company could do itself. Similarly, the company could delete posts. However, that policy only encourages the post author to scream even louder about being censored. Another risk is the 20–80 rule of thumb, which posits that a minority of individuals (20 percent) contribute most of the content (80 percent) to blogs, wikis, social computing Web sites, etc. For example, in an analysis of thousands of submissions to the news voting site Digg over a three-week time frame, the Wall Street Journal reported that roughly 33 percent of the stories that made it to Digg’s homepage were submitted by 30 contributors (out of 900,000 registered members). Other risks of social computing include the following: Information security concerns Invasion of privacy Violation of intellectual property and copyright Employees’ reluctance to participate Data leakage of personal information or corporate strategic information Poor or biased quality of users’ generated content Cyberbullying/cyberstalking and employee harassment Consider Rosetta Stone (www.rosettastone.com), which produces software for language translation. To obtain the maximum possible mileage out of social computing, Rosetta Stone implemented a strategy to control its customer interaction on Facebook. The strategy involves both human intervention and software to help monitor the firm’s Facebook presence. Specifically, the software helps to monitor Wall posts and respond to them constructively. Fans of facebook.com/Rosetta Stone who post questions on its Wall are likely to receive a prompt answer because the Facebook page is integrated with customer service software from Parature (www.parature.com). The software scans Wall posts and flags those posts that require a company response, as opposed to those in which fans of the company are talking among themselves. Rosetta Stone customer service representatives are also able to post responses to the Wall that are logged in the Parature issue tracking database. Companies are engaged in many types of social commerce activities, including shopping, advertising, market research, customer relationship management, and human resource management. In the next sections of this chapter, you will learn about each social commerce activity. before you go on... 1. Briefly describe the benefits of social commerce to customers. 2. Briefly describe the risks of social commerce to businesses. 9.3: Social Computing in Business: Shopping Social shopping is a method of electronic commerce that takes all of the key aspects of social networks—friends, groups, voting, comments, discussions, reviews, etc.—and focuses them on shopping. Social shopping helps shoppers connect with one another based on tastes, location, age, gender, and other selected attributes. The nature of shopping is changing, especially shopping for brand-name clothes and related items. For example, popular brands such as Gap, Shopbop, InStyle, and Lisa Klein are joining communities on Stylehive (www.stylehive.com) to help promote the season’s latest fashion collections. Shoppers are using sites like ThisNext (www.thisnext.com) to create profiles and blogs about their favorite products in social communities. Shoppers can tag each item, so that all items become searchable. Moreover, searching within these Web sites can yield results targeted specifically to individual customers. There are several methods to shop socially. You will learn about each of them in the next section. Ratings, Reviews, and Recommendations Prior to making a purchase, customers typically collect information such as what brand to buy, from which vendor, and at what price. Online customers do this by using shopping aids such as comparison agents and by visiting Web sites such as Epinions (www.epinions.com). Today, customers also use social networking to guide their purchase decisions. They are increasingly utilizing ratings, reviews, and recommendations from friends, fans, followers, and experienced customers. Ratings, reviews, and recommendations are usually available in social shopping. In addition to seeing what is already posted, shoppers have an opportunity to contribute their own ratings and reviews and to discuss rating and reviews posted by other shoppers (see Figure 9.4). The ratings and reviews come from the following sources: Customer ratings and reviews: integrated into the vendor’s Web page, a social network page, a customer review site, or in customer feeds (e.g., Amazon, iTunes, Buzzillions, Epinions). Expert ratings and reviews: views from an independent authority (e.g., see Metacritic). Sponsored reviews: paid-for reviews (e.g., SponsoredReviews, PayPerPost). Conversational marketing: individuals converse via e-mail, blog, live chat, discussion groups, and tweets. Monitoring these conversations yields rich data for market research and customer service. FIGURE 9.4: Epinions (www.epinions.com) is a Web site that allows customers to rate anything from cars to music. In this screenshot, customers review a popular children’s film. For example, Maui Jim (www.mauijim.com), the sunglass company, used favorable word-of-mouth marketing as a key sales driver. The company uses Bazaarvoice’s Ratings & Reviews to allow customers to contribute 5-point ratings and authentic product reviews on the company’s entire line of sunglasses and accessories. In effect, Maui Jim extended customers’ word-of-mouth reviews across the Web. Maui Jim encourages its customers to share their candid opinions on the style, fit, and performance of all of its sunglass models. To accomplish this goal, the company integrates customer reviews into its Web site search function to ensure that shoppers who are interested in a particular product will see that product’s rating in the search results. Customer response to this rating system has been overwhelmingly positive. Social recommendation Web sites such as ShopSocially (www.shopsocially.com), Blippy (www.blippy.com), and Swipely (www.swipely.com) encourage conversations about purchases. The product recommendations are submitted by users’ friends and acquaintances and arguably are more trustworthy than reviews posted by strangers. ThisNext (www.thisnext.com) is a Web site where people recommend their favorite products to others. The site blends two powerful elements of real-world shopping: word-of-mouth recommendations from trusted sources and the ability to browse products in a way that naturally leads to discovery. IT’s About Business 9.3 discusses a similar Web site, Pinterest (www.pinterest.com), in detail. IT’s [about business]: 9.3 Pinterest Social networks originated with blogging tools such as Blogger and WordPress, where users had to write an entire blog post to express themselves. Then Twitter and Facebook emerged, and a simple status update was all that was required to share a thought on the Web. These Web sites subsequently discovered even simpler ways to share opinions—for example, retweeting the updates of other users and “liking” Web pages on Facebook. Tumblr, now one of the largest blogging platforms, also fits this trend. Tumblr allows users to share images and to realign other people’s posts. Today, social sharing involves less effort, and it is more visual: “People-centric” recommendations are being augmented by “topic-centric” networks. Whereas Facebook lets users explore the Web through information shared by friends, newer social networks organize content by topics of interest. Flipboard (http://flipboard.com) is an example of these trends. This network organizes content both by topics and by the “stuff” your friends enjoy. Flipboard turns the news into a more visual experience on your iPad, personalizing your experience by highlighting links shared by your online connections as well as topics that you find interesting. Pinterest (www.pinterest.com) is a visual social network that organizes images by topic and allows users to reshare images with just one click. It also enables users to create online scrapbooks to share images of projects or products. The site is a kind of visual bulletin—or inspiration—board. Users, who currently must request an invitation to join Pinterest, create pinboards with categories like “Books I Love” or “Beautiful Places” or “Products That Save Me Time.” Users can then link images from Web sites (using a Pinterest browser bookmark) or upload images from their computers and “pin” the images to the boards. As with Twitter, users can follow other users, and Pinterest images can be repinned and shared. Pinterest has a devoted base of users—most of them female—who enjoy “pinning” items they find around the Web. Although clothing, home decor, and recipes dominate the site, inspirational quotes and humor are also popular topics. According to comScore, unique visitors to Pinterest increased 400 percent from September 2011 to December 2011. In January 2013, Pinterest attracted more than 12 million visitors. Further, the following month Pinterest drove more visitors to third-party Web sites than Google, YouTube, and LinkedIn combined. Despite its popularity, however, Pinterest is experiencing one major problem; namely, the site has no clearly defined strategy to make money. This situation is not unusual for an Internet startup. After watching the growth of Facebook and Twitter—both of which grew quickly at first without employing a traditional business model—Pinterest cofounder Ben Silbermann is following the same path, and he plans to worry about money-making details later. Historically, generating revenue from social networking sites, which are usually free to users, has been a challenge. Two options for Pinterest to consider are selling targeted advertising and selling data on users’ interests. Neither option is original, and both run the risk of alienating Pinterest users. Meanwhile, retailers are looking to piggyback off the popularity of Pinterest. For example, Bergdorf Goodman, a unit of the Neiman Marcus Group, is striving to develop a following for its high-end clothing and accessories on Pinterest. Similarly, Lands’ End Canvas added a widget to its product pages, making it easier for users to immediately pin or repost images to their Pinterest profiles. Etsy.com, an online crafts marketplace with more than 50,000 Pinterest followers, is using Pinterest’s price display feature. When Pinterest users pin, for example, an Etsy chair on a board for their followers to see, the image of the chair will automatically include the chair’s title and a banner displaying the price. Pinterest has also been helpful to small businesses. Consider The Wedding Chicks (www.weddingchicks.com), a relatively new online retailer of wedding-party gifts. The company claims that Pinterest brings more than double the traffic to its Web site than Facebook and Twitter do, combined. Sources: Compiled from T. Conneally, “Monetizing Pinterest? Pinbooster Has It Covered,” Forbes, February 2013; T. Wilms, “The Interest in Pinterest: The Ten Things We Love (and Hate),” Forbes, August 13, 2012; A. Pragnell, “Why Pinterest Could Be the Next Social Media Giant,” Forbes, July 2, 2012; K. Bischoff, “Winning the Mommy Market—Our StumbleUpon vs. Pinterest vs. Facebook Experiment,” Forbes, March 8, 2012; D. Donston-Miller, “Pinterest: Why Your Company Should Take an Interest,” InformationWeek, March 6, 2012; T. Watson, “Pinterest and the Hype Factor,” Forbes, February 24, 2012; S. Needleman, “Start-Ups Follow Pinterest’s Lead,” The Wall Street Journal, February 23, 2012; S. Needleman and P. Tam, “The Rite of Web Passage—Huge Traffic, No Revenue,” The Wall Street Journal, February 16, 2012; P. Cashmore, “Why Pinterest Is 2012’s Hottest Website,” CNN Tech, February 6, 2012; www.pinterest.com, accessed March 7, 2012. Questions 1. Describe two other ways in which Pinterest could generate revenue without alienating its users. 2. Are Facebook and Pinterest competitors? Why or why not? Support your answer. Group Shopping Group shopping Web sites such as Groupon (www.groupon.com) and LivingSocial (www.livingsocial.com, see Figure 9.5) offer major discounts or special deals during a short time frame. Group buying is closely associated with special deals (flash sales). FIGURE 9.5: LivingSocial (www.livingsocial.com) is a popular example of a group shopping Web site. People who sign up with LivingSocial receive e-mails that offer deals at, for example, a restaurant, a spa, or an event in a given city. They can click on either “today’s deal” or “past deal” (some past deals can still be active). They can also click on an icon and receive the deal the next day. Customers who purchase a deal receive a unique link to share with their friends. If a customer convinces three or more people to buy that specific deal using his or her link, then the customer’s deal is free. Vinobest is a French wine merchant that uses Facebook for group-buying and flash deals. The company offers opinions by oenologists (wine experts) and selections by sommeliers (wine stewards) for group-buying deals. Vinobest offers active pricing—the more people who buy, the cheaper the wine. Individuals can also shop together virtually in real time. In this process, shoppers log on to a Web site and then contact their friends and family. Everyone then shops online at the same time. Some real-time shopping providers, such as DoTogether (www.dotogether.com) and Wet Seal (www.wetseal.com), have integrated their shopping service directly into Facebook. Customers log in to Facebook, install the firm’s app, and invite their friends to join them on a virtual retail shopping experience. Shopping Communities and Clubs Shopping clubs host sales for their members that last just a few days and usually feature luxury brands at heavily discounted prices. Club organizers host three to seven sales per day, usually via e-mail messages that entice club members to shop at more than 70 percent off retail—but quickly, before supplies run out. Luxury brands effectively partner with online shopping clubs to dispose of special-run, sample, overstock, or liquidation goods. These clubs are rather exclusive, which prevents the brands’ images from being diminished. Examples are Beyond the Rack (www.beyondtherack.com), Gilt Groupe (www.gilt.com), Rue La La (www.ruelala.com), and One King’s Lane (www.onekingslane.com). Kaboodle (www.kaboodle.com) is another example of a shopping community. Kaboodle is a free service that lets users collect information from the Web and store it on a Kaboodle list that they can share with other shoppers. Kaboodle simplifies shopping by making it easier for people to find items they want in a catalog and by allowing users to share recommendations with one another using Kaboodle lists and groups. People can also use Kaboodle lists for planning vacations, sharing research for work and school, sharing favorite bands with friends, and basically everything else they might want to collect and share information about. FIGURE 9.6: Etsy (www.etsy.com) is a social marketplace for all handmade or vintage items. Social Marketplaces and Direct Sales Social marketplaces act as online intermediaries that harness the power of social networks for introducing, buying, and selling products and services. A social marketplace helps members market their own creations (see Etsy in Figure 9.6). Other examples include the following: Craigslist (www.craigslist.com) provides online classifieds in addition to supporting social activities such as meetings and events. Fotolia (www.fotolia.com) is a social marketplace for the community of creative people who enjoy sharing, learning, and expressing themselves through images, forums, and blogs; members provide royalty-free stock images that other individuals and professionals can legally buy and share. Flipsy (www.flipsy.com) can be used by anyone to list, buy, and sell books, music, movies, and games. Peer-to-Peer Shopping Models Peer-to-peer shopping models are the high-tech version of old-fashioned bazaars and bartering systems. Individuals use these models to sell, buy, rent, or barter online with other individuals. For example, many Web sites have emerged to facilitate online sharing. SnapGoods created a community of people who rent goods to people in need, usually for the short term. SnapGoods helps these people connect over the Internet. All of these peer-to-peer sites encourage collaborative consumption—that is, peer-to-peer sharing or renting. This trend is the result of the recession, because people had less money to spend and turned to sharing and renting. However, it has an environmentally “green” aspect as well. One of the most surprising benefits of collaborative consumption, however, turns out to be social. In an era when we may not know our neighbors that well, sharing things—even with strangers we have just met online—allows us to make meaningful connections. Some people share cars, and others invite travelers to stay in their homes for free. The following example illustrates the benefits of collaborative consumption. Example Collaborative Consumption An entirely new generation of businesses is emerging, created by the intersection of the economic crisis, environmental concerns, and the maturation of social computing. These firms help interested parties share cars, clothing, couches, apartments, tools, meals, and even skills. The basic characteristic of these sharing marketplaces is that they extract value out of the “stuff” we already have. The premise of collaborative consumption is simple: Having access to goods and skills is more important than owning them. There are three types of collaborative consumption: Product-service systems that enable people to share or rent a product (e.g., car sharing) Redistribution markets, which enable the reownership of a product (e.g., Craigslist) Collaborative lifestyles in which participants can share assets and skills (e.g., coworking spaces) Consider our second-most expensive asset, our cars. (Our homes are the most expensive.) Across the United States, Canada, and Western Europe, the average person uses his or her car only 8 percent of the time. In fact, cars are the ultimate expensive, underutilized commodity. In 2000, Zipcar started convincing city dwellers that they could enjoy the perks of access without the expense of actually owning a car. Zipcar is a U.S. membership-based car-sharing company providing automobile reservations to its members, billable by the hour or day. Members can reserve Zipcars online or by phone at any time. To access a car, members use an access card that works with the car’s technology to unlock the door, where the keys are already located inside. Zipcar also offers an iPhone and Android application that allows members to honk the horn to locate a Zipcar, and unlock the doors. Zipcar charges a one-time application fee, an annual fee, and a reservation charge. Gas, parking, insurance, and maintenance are included in the price. Competitors are emerging for Zipcar. Companies like RelayRides (http://relayrides.com), Zimride (www.zimride.com), Spride (www.spride.com), and Getaround (www.getaround.com) do not own any cars—they simply enable individuals to share them. For example, the average person who allows his or her car to be rented at RelayRides makes $250 per month. In fact, some users are making enough money on RelayRides to cover their entire car payment. Moreover, because RelayRides includes a $1 million insurance policy that covers both owners and renters during each reservation, renting from RelayRides is a low-risk arrangement. In addition to its financial benefits, car sharing offers environmental benefits as well. When people’s mobility costs shift from being fixed (ownership) to variable (renting), they make more efficient decisions about when and how frequently they actually need to drive. Research has demonstrated that the average car sharer drives 40 percent less than the average owner. German car manufacturer Daimler is taking car sharing seriously. Its Car2Go (www.car2go.com) service is similar to Zipcar’s, except that it does not require a reservation or a two-way trip. Car2Go’s mobile app allows a person walking down a city street to locate a car on that block, access it immediately via a windshield card reader and PIN number, drive it anywhere locally, and leave it there for someone else to use. The fuel-efficient Smart car has a 100-watt solar roof, which powers the car’s telematics (discussed in Chapter 8) and its battery. Daimler is also developing an app called Car2Gether (www.car2gether.com), which matches local drivers with people who are looking for a ride. Riders submit a request to a driver of any type of car, and both profiles are linked to their Facebook pages and Twitter feeds. After the ride, both the driver and the rider rate each other. Perhaps the greatest concern associated with car sharing is trust. Sharing works well only when the participants’ reputations are involved. Most sharing platforms try to address this issue by creating a self-policing community. Almost all platforms require profiles of both parties, and they feature community rating systems. Startups like TrustCloud (http://trustcloud.com) are endeavoring to become the portable reputation system for the Web. The company has built an algorithm that collects (if you choose to opt in) your online “data exhaust”—the trail you leave as you engage with others on Facebook, LinkedIn, Twitter, commentary-filled sites like TripAdvisor, and others. It then calculates your reliability, consistency, and responsiveness. The result is a contextual badge that you carry to any Web site, a trust rating similar to the credit rating you have in the “offline” world. Of course, Facebook is already collecting a huge amount of your data exhaust on its own site. Thus, Facebook could become the arbiter of online trust. Collaborative consumption has the potential to become extremely disruptive to existing organizations. For example, if the people formerly known as “consumers” began consuming 10 percent less and sharing 10 percent more, traditional corporations would certainly see their profits decline. Sources: Compiled from D. Brodwin, “The Rise of the Collaborative Consumption Economy,” U.S. News and World Report, August 9, 2012; D. Sacks, “The Sharing Economy,” Fast Company, May, 2011; www.collaborativeconsumption.com, www.car2go.com, http://trustcloud.com, accessed March 30, 2013. Questions 1. What are some potential disadvantages of car sharing? 2. Describe how collaborative consumption can be disruptive to traditional organizations. How might the organizations respond to this challenge? before you go on... 1. Why are ratings, reviews, and recommendations so important to potential customers? 2. Define collaborative consumption and describe how collaborative consumption is a “green” phenomenon. 9.4: Social Computing in Business: Marketing Marketing can be defined as the process of building profitable customer relationships by creating value for customers and capturing value in return. There are many components to a marketing campaign, including (1) define your target audience; (2) develop your message (i.e., how you will solve their problem); (3) decide on how you will deliver your message (e.g., e-mail, snail mail, Web advertising, and/or social networks); and (4) follow up. Social computing is particularly useful for two marketing processes: advertising and market research. Advertising Social advertising refers to advertising formats that make use of the social context of the user viewing the ad. Social advertising is the first form of advertising to leverage user dynamics such as peer pressure, friend recommendations and likes, and other forms of social influence. Many experts consider advertising to be the solution to the challenge of making money from social networking sites and social commerce sites. Advertisers have long noted the large number of visitors on social networks and the amount of time they spend there. As a result, they are willing to pay to place ads and run promotions on social networks. Advertisers now post ads on all major social networking Web sites. Most ads in social commerce consist of branded content paid by advertisers. These ads belong to two major categories: social advertisements (or social ads) and social apps. Social advertisements are ads placed in paid-for media space on social media networks. Social apps are branded online applications that support social interactions and user contributions (e.g., Nike+). Viral marketing—that is, word-of-mouth advertising—lends itself especially well to social networking. For example, Stormhoek Vineyards (www.stormhoek.com) initiated a marketing campaign by offering bloggers a free bottle of wine. Within six months, about 100 of these bloggers subsequently had posted voluntary comments—the majority of them positive—about the winery on their blogs. In turn, these comments were read by other bloggers. There are other innovative ways to advertise in social media. Consider the following: Use a company Facebook page, including a store that attracts fans and lets them “meet” other customers. Then, advertise in your Facebook store. Tweet business success stories to your customers. Integrate ads into YouTube videos. Add a Facebook “Like” button with its sponsored story (advertisement) to your product. For example, Gatorade scored 1.2 million conversations in six months using their “Mission Control” campaign. Mercedes-Benz launched a “Tweet Race,” which challenged four teams to drive across the country in Mercedes automobiles to Dallas, Texas, where the 2011 Super Bowl was being played. Each team collected Twitter followers with the help of a celebrity coach. Each tweet or retweet earned the team points, as did other activities, such as photographing other Mercedes cars during the road trip. The team that accumulated the most points by the end of the trip was declared the winner. Facebook has introduced a feature called the “sponsored story.” When a member chats with friends and one of them indicates that he or she “checked into” a place or “liked it,” say at Starbucks, a boxed “sponsored story” (an advertisement) will appear with the Starbucks logo (fee paid to Facebook). Furthermore, the name “Starbucks” will also appear in the user’s news feed (another fee paid to Facebook). The users have the option to delete the boxed advertisement. For an interesting example of aggressive social advertising, you need look no further than YouTube. IT’s About Business 9.4 illustrates how YouTube is increasing its ad revenue in an incredible number of areas. IT’s [about business]: 9.4 YouTube Is Redefining the Entertainment Business When new cable channels such as CNN and ESPN emerged, they were underestimated by the traditional television networks. The question is: Can YouTube be as successful as CNN and ESPN? YouTube (www.youtube.com) is utilizing its vast customer base (some 500 million viewers per month) to help define a new avenue for content creators to reach an audience. The concept is intriguing, but actually implementing the idea proved to be challenging for YouTube. When YouTube was first created, it suffered from a reputation problem. Advertisers worried that their brands might end up next to a low-quality home video. Therefore, YouTube needed to create a business model that was unique to video. The site built a multitude of ad products that were crafted around the way people actually used the company’s Web site. With the help of these new ad products, many of the activities regularly performed by YouTube users—specifically, starting their experience at the home page, searching for a video, visiting a channel, watching a movie trailer, or watching a music video—were translated into appropriate advertising opportunities. Google has predicted that by 2015 roughly 50 percent of display ads on YouTube will include video and 75 percent will have a social component. The new ad products have begun to attract major brand advertisers to the Web site. Consider Philadelphia Cream Cheese, produced by Kraft Foods. The brand manager learned that YouTube is a haven for how-to videos about cooking. So, he came up with the “Real Women of Philadelphia” competition. On the launch day of the eight-month campaign, Kraft bought all of the advertising space on YouTube’s home page, which cost more than $375,000. The ad invited women to invent Philly cream cheese recipes and cast themselves in their own videos as TV professionals. The goal was to drive viewers to Philly’s Real Women community, which included Kraft’s YouTube channel. More than 50 million people viewed the launch video. Ten million of them watched the entire video, and almost 100,000 clicked through to the Philly cream cheese Web site (an impressive number). In addition to the recipe views, Real Women helped boost Philly’s revenue by 5 percent, the first increase in five years. Promoted videos, which are video ads featured prominently on YouTube’s search-results page, share prime space with the types of content that a particular user has searched for in the past. Research studies have indicated that these ads triple brand awareness, even without further action or follow-up on the part of the viewer. YouTube has also devised a method to overhaul the way ads are consumed and sold on its site. This process, called TrueView, offers viewers the option to skip an ad entirely, but it charges advertisers a premium if viewers choose their content and watch it the entire way through. In 2007, YouTube launched another marketing effort, known as the Partner program, to encourage audience-attracting producers to create more and better content. Under this program, YouTube sells ads next to its videos and gives audience-attracting producers more than half the revenue. By mid-2013, YouTube had recruited more than 10,000 partners to the program. Analysts estimate that the top 300 to 400 partners earned their living from content they produced for YouTube. In December 2011, YouTube released Personalized Channels, which tries to replicate for video the predictive experience that Pandora creates for music. YouTube has also enjoyed great success with globally broadcast live concerts that sites such as Hulu and Netflix, which are restricted to North America, cannot match. In November 2010, just before the release of Bon Jovi’s greatest-hits album and international tour, the band gave an intimate concert in a 2,100-person venue in New York’s Times Square, and they streamed it live via YouTube around the world. The YouTube team globally marketed the show, and they allowed Bon Jovi to use YouTube’s new moderator tool to give fans an opportunity to interact by helping to pick the concert’s song list. Following this campaign, Bon Jovi’s greatest-hits album debuted in the top five in more than 20 markets around the world. In 2006, less than 20 months after YouTube was founded, Google acquired the site for $1.65 billion. Since that time, YouTube has often been referred to as “Google’s folly.” Despite this moniker, by mid-2012 Google had evolved into the world’s largest video platform. YouTube’s success is largely a product of its strategy of cultivating its vibrant community. Google believes that YouTube is emerging as the first global TV station. Video delivered via the Internet is creating a world with hundreds of thousands of “TV channels,” and YouTube is helping people build these next-generation networks. Not only has YouTube created the largest online video community in the world, it is shaping the way video is produced, distributed, and monetized. Not surprisingly, YouTube is also realizing increasing amounts of revenue. Google does not break out specific numbers for YouTube, but financial analysts who cover the company estimate that YouTube’s revenue increased from somewhere between $100 million and $250 million in 2008 to approximately $4 billion in 2013. Despite YouTube’s phenomenal growth, many critics remain skeptical of the site’s business model. They contend that YouTube still needs Hollywood content if it is to compete with Hulu and Netflix. Hollywood producers, however, still view YouTube primarily as a great promotion platform rather than a home for their content. Take a look at YouTube’s initiatives to expand programming and ad formats. YouTube Content Original Content: YouTube shares ad revenue with top content creators. Examples: The Annoying Orange, Next New Networks, Machinma, Nigahiga, The Young Turks Concerts: Live streaming concerts have drawn between 5 and 10 million live views. YouTube teamed up with Vevo and American Express in 2010 for its Unstaged series. Examples: Bon Jovi, U2, The National, Alicia Keys, Arcade Fire, John Legend & The Roots Sports: IPL, a cricket league in India, pulled in 55 million views during its first season on YouTube. Examples: IPL and Major League Baseball How To: YouTube has given rise to a generation of teaching stars. Michelle Phan’s tutorial on Lady Gaga’s “Poker Face” look has received 24 million views and paved the way for Phan’s deals with Colgate, Lancome, and others. Examples: Michelle Phan (makeup), Sal Khan (Khan Academy), ViewDo (guitar) Movies/TV: YouTube tries to offer longer-form content not available elsewhere. Examples: Striker, World Wrestling Entertainment, Sundance Film Festival, BBC Channels 4 and 5 Advertising as Content: To promote its Trivial Pursuit: Bet You Know It edition, Hasbro ads pit users against YouTube stars, generating more than 250 million views. Examples: Kraft, Hasbro, The Last Exorcism YouTube’s Sources of Revenue Home Page: The YouTube Homepage Roadblock allows brands to own the homepage for 24 hours with a 100 percent share. The homepage averages 50 million impressions and over 18 million unique daily visitors. Therefore, the home page enables brands to have a big impact on a concentrated audience. Examples: Verizon, Hasbro, Kraft, Dreamworks, Fox Promoted Videos: Like sponsored ads on Google, promoted videos pop up around search results. Advertisers pay only when users click “Play.” Examples: Evian, Panasonic, Stouffer’s, Wrigley, Maybelline Content ID: To avoid hosting illegally posted videos, YouTube learned how to identify them, a process called Content ID. YouTube then alerts copyright owners—including early adopter CBS—who decide whether to take down the video or sell ads against it. Examples: CBS, Lionsgate (Mad Men), Sony Click-to-Buy: Call-to-action spots with videos can transform viewers into consumers. For example, Monty Python videos directed viewers to the troupe’s DVDs on Amazon, increasing sales by 23,000 percent. Examples: Cee Lo Green (iTunes), Monty Python (Amazon) Branded Channels: YouTube gives brands a great deal of latitude. For example, the CEO of the Visionaire Group claims that YouTube provides his company with the flexibility to engage users in a way that no other outlet does. Examples: Lionsgate (The Expendables), Samsung, Tipp-Ex Display: Google predicts that digital billboards will add more video and become more social in the next few years, eventually expanding into a $50 billion industry. Examples: Blizzard Entertainment, HTC, Absolut, Volvo Sources: Compiled from A. Knapp, “Indie Hip-Hop Star Destorm Power on YouTube and the Future of Music,” Forbes, March 1, 2012; H. Shaughnessy, “YouTube Creators and the Rise of Social Entertainment,” Forbes, February 21, 2012; A. Knapp, “Meredith Valiando Is Bringing YouTube to Concert Halls,” Forbes, February 18, 2012; H. Shaughnessy, “Where Is the Big Time Headed? RockStar, Comic, Actor, and the Story of the Social Brand,” Forbes, February 1, 2012; J. Perez, “YouTube to Boost Original, Professional Programming,” CIO, October 29, 2011; D. Jeffrey, “Viacom Tells Court YouTube Deliberately Violated Copyrights,” Bloomberg BusinessWeek, October 18, 2011; A. Efrati, “YouTube Goes Professional,” The Wall Street Journal, October 4, 2011; D. Sacks, “Blown Away,” Fast Company, February 2011; F. Gillette, “On YouTube, Seven-Figure Views, Six-Figure Paychecks,” Bloomberg BusinessWeek, September 23, 2010; T. Claburn, “YouTube Promises 15 Minutes of Fame,” InformationWeek, July 29, 2010; E. Williams, “The YouTube Dilemma,” Bloomberg BusinessWeek, March 18, 2009; www.youtube.com, accessed March 8, 2013. Questions 1. Describe YouTube’s basic model for revenue generation. 2. If you were the CEO of a television network, how would you combat YouTube? Market Research Traditionally, marketing professionals used demographics compiled by market research firms as one of their primary tools to identify and target potential customers. Obtaining this information was time-consuming and costly, because marketing professionals had to ask potential customers to provide it. Today, however, members of social networks provide this information voluntarily on their pages! (Think about all the information that you provide on your favorite social networking Web sites.) Because of the open nature of social networking, merchants can easily find their customers, see what they do online, and see who their friends are. This information provides a new opportunity to assess markets in near real time. Word of mouth has always been one of the most powerful marketing methods—more often than not, people use products that their friends like and recommend. Social media sites can provide this type of data for numerous products and services. Companies are utilizing social computing tools to obtain feedback from customers. This trend is referred to as conversational marketing. These tools enable customers to supply feedback via blogs, wikis, online forums, and social networking sites. Again, customers are providing much of this feedback to companies voluntarily and for free. Social computing not only generates faster and cheaper results than traditional focus groups, but also fosters closer customer relationships. For example, Dell Computer operates a feedback Web site called IdeaStorm that allows customers to suggest and vote on improvements in its offerings (see Figure 9.7). Retailers are aware that customers, especially younger ones, not only want to be heard, but also want to know whether other customers agree with them. Consequently, retailers increasingly are opening up their Web sites to customers, allowing them to post product reviews, ratings, and, in some cases, photos and videos. As a result of this strategy, customer reviews are emerging as prime locations for online shoppers to visit. Approximately one-half of consumers consult reviews before making an online purchase, and almost two-thirds are more likely to purchase from a site that offers ratings and reviews. For example, Del Monte (www.delmonte.com), through its “I Love My Dog” program, gathers data from pet owners that can help shape its marketing decisions. Del Monte’s private social network helps the company to make decisions about products, test-market campaigns, understand buying preferences, and generate discussions about new items and product changes. Using social computing for market research is not restricted to businesses. Customers also enjoy the capabilities that social computing offers when they are shopping. IT’s About Business 9.5 illustrates how social computing helps shoppers perform market research utilizing Cars.com to find the car they want. Conducting Market Research Using Social Networks Customer sentiment expressed on Twitter, Facebook, and similar sites represents an incredibly valuable source of information for companies. Customer activities on social networking sites generate huge amounts of data that must be analyzed, so that management can conduct better marketing campaigns and improve their product design and their service offerings. The monitoring, collection, and analysis of socially generated data and the resultant strategic decisions are combined in a process known as social intelligence. FIGURE 9.7: Customers share their ideas and feedback with Dell via IdeaStorm (www.ideastorm.com). IT’s [about business]: 9.5 Buying a Vehicle Takes Work! With access to seemingly limitless amounts of information, American consumers can research nearly everything about automobiles, from car ratings and reviews to safety features and financing options. As a result, when they arrive at a dealership, they are better equipped to negotiate a sale than ever before. Social media apps are helping to drive this customer empowerment, providing the most current vehicle and dealership information. Social media sites have become an integral part of the purchase process. A survey conducted by Capgemini (an international information technology consulting firm) found that the majority of respondents would be more likely to purchase a vehicle from a dealer if they found positive comments on social media sites. Today’s car dealers leverage social media (e.g., Facebook, Twitter, Tumblr, and many other sites) to build and engage communities through special promotions, coupons, and sales events. Dealers book showroom and service appointments over the Web, and they use apps like ClearMechanic, which lets dealer service operations explain repairs with photos and illustrations. Cars.com is one of the Web sites that prospective car buyers turn to in their quest for information. Let’s examine how the site uses social media to help its visitors. Cars.com, a business unit of Classified Ventures (www.classifiedventures.com), serves approximately 10 million car shoppers per month. The company realizes that comparing features on different automobile models can be confusing to buyers. To make a wise buying decision, customers must compare many different types of information, including performance specifications, a variety of high-tech systems, and numerous safety features. To assist these customers, the Cars.com Web site (www.cars.com) integrates different types of data from different sources and presents them in a way that customers can use to shop for vehicles, compare features, read reviews, and obtain price quotes directly from dealerships. To help customers understand and use all of the information contained on its Web site, the company is integrating Web 2.0 technology wherever it adds value and streamlines customer interactions. Cars.com is turning Web 2.0 into a competitive advantage. The company provides sophisticated Web capabilities and mobile tools that make it easier for customers to find, view, and extract the information they need to make a buying decision. Cars.com recognizes that a seamless experience on its Web site equals clicks, which in turn equals revenue. The company earns revenue from online classified ads placed by automakers, dealers, and private-party sellers. It also sells banner advertisements and provides lead-generation services. Cars.com offers comprehensive pricing information, photo galleries, buying guides, side-by-side comparison tools, original editorial content, expert car reviews, and other relevant content from auto manufacturers. In addition, it provides user-generated content from customers themselves such as ratings of different makes and models. The company’s Web site contains online portals for dealers and customers. The company’s Web site also contains many other useful tools. The following are a few examples: A tool focused on helping dealers list used vehicles at an optimal price when they place a classified ad. A tool that provides information about inventory levels, buying trends, and other factors. A tool that offers customers live data about incentives. When a potential buyer visits the Cars.com configuration tool and clicks through various automobiles and options, he or she sees any specific manufacturer and dealer incentives and rebates—matched to the specific vehicle and the exact configuration. This capability eliminates the problems associated with clicking to a different part of the Web site and manually searching for this information. This feature increases the “stickiness” factor of the Web site. (Stickiness refers to the amount of time a visitor spends on a Web site.) Cars.com is also using social media such as Facebook and Twitter to further integrate content and offerings. The company wants to increase its visibility, while making information more accessible and useful to a larger audience. Cars.com also offers iPhone, Android, and BlackBerry mobile apps. In addition, it has implemented a mobile Web site that is optimized for mobile phone browsers. Approximately 25 percent of the firm’s total online traffic arrives through mobile devices. Sources: Compiled from D. Vasquez, “How Social Media Has Changed Car Buying,” MediaLife Magazine, February 28, 2013; “Is Social Media Changing Car Buying Decisions?” Bloomberg BusinessWeek, February 22, 2013; K. Casey, “Can Social Media Sell Cars?” InformationWeek, February 5, 2013; “The New Age Consumer,” Time, November 5, 2012; B. Upbin, “Forbes Panel Tracks Footprints of the Elusive Customer,” Forbes, February 7, 2012; S. Greengard, “Cars.com Drives Performance,” Baseline Magazine, June 14, 2011; H. Elliot, “Common Car-Buying Mistakes,” Forbes, May 9, 2011; www.cars.com, accessed February 22, 2013. Questions 1. Is it possible for the Cars.com Web site to provide too much information to its customers? If so, how could this hurt the company? 2. What other Web 2.0 functionality could Cars.com include on its Web site to provide additional information for visitors who access the site? An example of social intelligence is Wendy’s International (www.wendys.com), which uses software to sift through the more than 500,000 customer messages the fast-food chain collects each year. Using Clarabridge (www.clarabridge.com) text analytics software, Wendy’s analyzes comments from its online notes, e-mails, receipt-based surveys, and social media. Prior to adopting this software, the company used a combination of spreadsheets and keyword searches to review comments in what it describes as a slow and expensive manual approach. In contrast, the new software enables Wendy’s to track customer experiences at the store level within minutes. Social networks provide excellent sources of valuable information for market research. Here you see illustrative examples of how to use Facebook, Twitter, and LinkedIn for market research. Using Facebook for Market Research. There are several ways to use Facebook for market research. Consider the following examples: Obtain feedback from your Facebook fans (and their friends if possible) on advertising campaigns, market research, etc. It is like having a free focus group. Test-market your messages. Provide two or three options, and ask fans which one they prefer and why. Use Facebook for survey invitations (i.e., to recruit participants). Essentially, turn Facebook into a giant panel, and ask users to participate in a survey. Facebook offers a self-service model for displaying ads, and these ads can be invitations to take a survey. Facebook also allows you to target your audience very specifically based on traditional demographic criteria (age, gender, etc.). Using Twitter for Market Research. Your customers, your prospects, and industry thought leaders all use Twitter, making it a rich source of instantly updated information. Consider the following examples: Visit Twitter Search (www.twitter.com/search). Enter a company’s Twitter name. Not only can you follow what companies are saying, you can also follow what everyone is saying to them. Monitoring replies to your competitors and their employees will help you develop your own Twitter strategy by enabling you to observe (a) what your competitors are doing and, more importantly, (b) what people think about it. You can also follow the company’s response to this feedback. Take advantage of the tools that enable you to find people in the industries they operate in. Use search.twitter.com to monitor industry-specific keywords. Check out Twellow (www.twellow.com). This site automatically categorizes a Twitter user into one to three industries based on that person’s bio and tweets. Do you want to know what topic is on most people’s minds today? If so, then review the chart on TweetStats (www.tweetstats.com). It will show you the most frequently used words in all of Tweetdom, so you can be a part of those conversations. An increasing number of companies are utilizing Twitter to solicit information from customers and to interact with them. Examples are Dell (connecting with customers), JetBlue (learning about customers), Teusner Wines (gathering feedback, sharing information), and Pepsi (fast response time in dealing with complaints). Using LinkedIn for Market Research. Post a question (e.g., solicit advice) regarding the topic or issue you are interested in. You may get a better result if you go to a specific LinkedIn group. For example, let’s take a look at how Mountain Dew uses social computing to conduct market research. The company has always appealed to consumers who were looking for high-caffeine beverages. However, the brand wanted to unite all of its customers into one community with its Dewmocracy contests, which let consumers pick the newest flavor. Several brands have used social networks to help them choose new flavors, but Mountain Dew is expanding its scale from the most dedicated fans to the public at large. The first step of its market research involved sending seven flavors of soda to 50 Dew fanatics, who were also given cameras and told to debate and show their like or dislike for the brand on a video. The cameras were a great idea because it made the social media effort more personable. Rather than just looking at static images or tweets, Dew fans could see like-minded Dew fanatics in action. After narrowing the seven flavors to three, based in part on the videos, Mountain Dew turned to its Dew Labs Community, a 4,000-person group comprised of passionate soda fans. Those fans then created nearly every element of the three sodas, including color, name, packaging, and marketing campaigns. After that process was complete, Mountain Dew made the three flavors available in stores for a limited time, with the general public electing a winner (a drink named Voltage) via online voting. The Dewmocracy campaign utilized Facebook, Twitter, and YouTube to unite consumers through a common interest. before you go on... 1. Is social advertising more effective than advertising without a social component? Why or why not? 2. Describe how marketing professionals use social networks to perform marketing research. 9.5: Social Computing in Business: Customer Relationship Management The customer service profession has undergone a significant transformation, both in the ways that customer service professionals do business and in the ways that customers adapt to interacting with companies in a newly connected environment. Social computing has vastly altered both the expectations of customers and the capabilities of corporations in the area of customer relationship management. How Social Computing Improves Customer Service Customers are now incredibly empowered. Companies are closely monitoring social computing not only because they are mindful of the negative comments posted by social network members, but also because they perceive an opportunity to involve customers proactively to reduce problems by improved customer service. Empowered customers know how to use the wisdom and power of crowds and communities to their benefit. These customers choose how they interact with companies and brands, and they have elevated expectations concerning their experiences with a company. They are actively involved with businesses, not just as purchasers, but also as advocates and influencers. As a result, businesses must respond to customers quickly and appropriately. Fortunately, social computing provides many opportunities for businesses to do just that, thereby giving businesses the opportunity to turn disgruntled customers into champions for the firm. Consider the following examples: Qantas airlines (www.qantas.com.au) had a policy that required flyers to store large musical instruments in the cargo hold. Unfortunately, policy sometimes caused damage to the instruments. After suffering $1,200 in damage to his saxophone, one customer, Jamie Oehlers of Australia, organized a Facebook campaign to persuade the airline to eliminate this policy. When one person complains, he or she typically receives a nice letter, but company policy most likely will not change. When more than 8,700 people joined forces on Facebook (including members of national symphony orchestras), however, posting stories and pictures of instruments that had been damaged in the cargo hold and threatening to boycott the airline, Qantas had to listen carefully. The airline announced that they had listened to their customers and changed the policy. The new policy allows small musical instruments as carry-on baggage. Safeway, a large grocery chain, operates a customer club that provides members with in-store discounts. The company also sends e-mails to customers that contain coupons and a description of what is on sale as well as an online newsletter with health news and recipes, shopping tips, etc. To extend this service, Safeway invites you to become a Facebook fan and follow the company on Twitter. This way you will be the first to know about exclusive promotions and savings. Plus, you are able to connect and share information with other Safeway shoppers. You can also visit the company’s blog, “Today at Safeway!” Team members post items from the floral department, the bakery department, and other departments throughout the stores. You can hear from Safeway’s experts on nutrition, environmental sustainability, and more. The blog is a free vehicle that promotes active discussion among the Safeway community. Safeway moderates all communications, and it will not post any comments that contain offensive language, private or personal information, hateful or violent content, personal attacks, and self-serving promotion of goods, Web sites, or services. Also, the company asks members to post only original content. Best Buy is a large appliances retailer that sought to augment its in-store business by attracting online customers. The company developed a unique strategy to provide real-time customer service by utilizing its Twitter’s @twelpforce account. Best Buy permitted the “blue shirt” members of its Geek Squad tech support service and corporate employees to staff its @twelpforce. In addition, any Best Buy employee working on company time can provide answers by using an @ reply to the customer. About 4,000 employees signed up to answer questions. By tagging their tweets with Twelpforce, these employees send their answers through the @twelpforce account. Anyone can then search the feed for topics they are researching. In December 2010, Groupon featured a discount to a restaurant delivery service in Tokyo for the New Year. The promotion was wildly successful, selling more than 500 “Groupons.” Unfortunately, the restaurant was not prepared for this level of success, so it was unable to accommodate all of the orders. Deliveries were late, and many of them were in terrible condition. Andrew Mason, the CEO of Groupon, assumed responsibility for the failure. He acknowledged that he contracted to an organization that was not prepared to deal with the volume generated by the Groupon promotion. His company then refunded money to the customers who bought the coupons, and it gave away vouchers for future business. Groupon also created a video that featured a public apology about the incident. The apology was sincere and informative, explaining exactly what had happened and holding nothing back. before you go on... 1. Discuss why social computing is so important in customer relationship management. 2. Describe how social computing improves customer service. 9.6: Social Computing in Business: Human Resource Management Human resource (HR) departments in many organizations use social computing applications primarily in the areas of recruiting and training. For example, Deloite Touche Tohmatsu created a social network to assist its HR managers in downsizing and regrouping teams. Recruiting Both recruiters and job seekers are moving to online social networks as recruiting platforms. Enterprise recruiters are scanning online social networks, blogs, and other social resources to identify and find information about potential employees. If job seekers are online and active, there is a good chance that they will be seen by recruiters. In addition, on social networks there are many passive job seekers—people who are employed but would take a better job if one appeared. So, it is important that both active and passive job seekers maintain online profiles that truly reflect their background and skills. IT’s About Business 9.6 takes a look at the difficulties inherent in the online recruiting process. It also provides some tips to assist you in a job search. Training Several companies use virtual worlds for training purposes. For example, Cisco uses its virtual campus in Second Life for product training and executive briefings. IBM runs management and customer interaction training sessions in Second Life as well. before you go on... 1. Describe why LinkedIn has become so important in the recruiting process. 2. If you are looking for a job, what is major problem in restricting your search to social networks? IT’s [about business]: 9.6 So You Want to Find a Job The workplace you are about to enter has changed. In the past, the conventional wisdom was that companies provided a career for life. Going online to create a public profile that could win recruiters’ attention would have seemed rude and risky. Then came layoffs, mergers, and financial downturns. The average baby boomer was likely to hold 11 jobs over the course of his or her career. As a result of these developments, employees stopped feeling much loyalty to their employer of the moment. Suddenly, placing your public profile online became the smart thing to do. Let’s say you want to find a job. Like the majority of job hunters, you will probably conduct at least part of your search online, typically on job sites such as www.monster.com, www.careerbuilder.com, and www.simplyhired.com. After all, the vast majority of entry-level positions in the United States are now listed only online. Using job sites has clear advantages for you: They are the cheapest, fastest, and most efficient way to connect employers with potential employees. Unfortunately, these sites can be overwhelmed with resumes, making it impossible for them to process these resumes efficiently and effectively. In the worst-case scenario, your resume will end up in a “black hole.” For example, Starbucks attracted 7.6 million job applicants for 65,000 corporate and retail job openings, and Procter & Gamble received nearly 1 million applications for 2,000 available positions. Luckily for you, job sites now have access to vast amounts of computing power (see cloud computing in Technology Guide 3), and they use new, more efficient search algorithms to help manage millions of resumes. In addition, you have access to many companies whose job is to assist you in your search. On the other side of the job-search equation, employers have downsized their recruiting staffs in recent years, so they cannot keep up with the flood of applications produced by the various job sites. Some companies have attempted to replace human recruiters with software designed to sift applications; however, this process has serious downsides as well. If the company’s sorting algorithm is too lax, it can yield numerous irrelevant results that waste time and money. If it is too rigid, the company can miss qualified applicants. Going further, less-qualified candidates can game the system by loading their resumes with the correct keywords that sorting programs typically search for. Finally, relying on software programs to sort applications removes any human interaction (e.g., actual human job interviews), which frequently signals a good fit between candidate and position. In perhaps the most dramatic shift in the online employment business, job searchers are turning away from traditional job sites and toward social networks such as LinkedIn and Facebook, where many of them feel more comfortable and in control. Applicants like you have helped LinkedIn raise its market share in job search from 4.7 percent in 2010 to a projected 12.2 percent by the end of 2013. This shift explains why Simply Hired incorporated social networking into its search process, a move that enabled job seekers to integrate their networks with Simply Hired’s job listings, making contacts and referrals to target companies easier. To find a job, your best bet is to begin with LinkedIn (www.linkedin.com), which has roughly 165 million members. You should definitely have a profile on LinkedIn, which, by the way, is free. (See the end of this case for mistakes to avoid on your LinkedIn profile.) Rather than try to obtain a few dollars here and there from individual users, LinkedIn has focused on selling a more powerful service to corporate talent scouts, namely, the company’s flagship Recruiter product. Thousands of companies use the tool. In human resource departments, having your own Recruiter account is like being a bond trader with a Bloomberg terminal—it is a must-have tool. LinkedIn’s success comes from a dedication to selling services to recruiters who buy talent for a living. LinkedIn doubled its sales employees in 2012, and the company now spends 33 percent of its revenue on sales and marketing, a higher percentage than Oracle, Microsoft, Facebook, and Google. Each time LinkedIn has expanded its sales team for Recruiter and other hiring-solution products, the payoff has been rewarding. Perhaps the fundamental reason for LinkedIn’s success has been its ability to accurately identify its market segment. The company realizes that its automated approach does not lend itself well to the upper tier of the job market—for example, CEO searches—where traditional face-to-face searches continue to be the preferred strategy. At the other end of the spectrum—that is, low-paying, low-skill jobs such as cashiers and truck drivers—job boards provide faster results. LinkedIn targets the vast sweet spot between these two extremes, helping to fill high-skill jobs that pay anywhere from $50,000 to $250,000 or more per year. This is the spot you will likely be in when you graduate. Let’s take a look at a company that uses the LinkedIn Recruiter product. Adobe Systems (www.adobe.com) employs 10,000 people, and, at any time, the company will likely need to fill at least 750 openings worldwide. Traditionally, staffing agencies handled about 20 percent of Adobe’s hunts for highly specialized engineers and digital experts. These search agencies were expensive, however, charging as much as $20,000 for each job they filled. Further, retention rates on their placements could be disappointing. In the past, there was no obvious alternative for Adobe to consider. Good people at other tech companies did not answer job ads. Such candidates would not switch employers unless another company found them and made them an excellent offer. Then, a few years ago, Adobe recruiters staged a talent-scouting race. One pair of recruiters used the traditional method to locate 50 solid candidates for a technical job. Another pair used LinkedIn. The pair using LinkedIn completed the task in only hours. Weeks later, the other pair was still searching. Today, Adobe relies on search agencies for less than 2 percent of its job placements in the Americas. LinkedIn is also invaluable in finding hidden candidates who would be overlooked in traditional searches. Consider the hiring manager for Wireless Vision, a mobile phone retailer. She was asked to find an accounting manager with entrepreneurial spirit. Regular job ads produced only 100 candidates, all of them unsuitable. So, the manager crafted a search on LinkedIn. Her target: accountants who had worked in similar retail companies and whose profiles included keywords such as “launched,” “created,” and “built.” Within days she had found an Avis veteran who had developed billing systems on his own. The two individuals talked, and Wireless Vision had its new accounting manager. A number of job-search companies are competing with LinkedIn. These companies are trying to create better-targeted matching systems that leverage social networking functionality. Here are two examples: Beyond Credentials (www.beyondcredentials.com) uses specialized algorithms to shrink the applicant pool to a more manageable, higher-quality list by targeting young professionals with good grades from good schools. The firm also works only with employers who offer a minimum starting salary of $30,000 as well as room for advancement and working environments that Beyond Credentials staffers would want for themselves. The firm provides applicants with a personal pitch page that can even include video. Beyond Credentials charges $5,000 annually for one recruiter to use the site and $1,000 more per additional recruiter. Jobvite (www.jobvite.com) helps client companies by integrating social networking with the personal referrals that employers prefer. Clients’ employees are allowed to send their online “friends” a “jobvite” to apply for an opening. So, how are traditional search firms like Monster and CareerBuilder responding? These two companies claim that they are no longer simply job sites. Instead, they offer an array of products, some of which include social networking features. Both companies have moved quickly to transfer their apps to mobile, which is particularly important in Asia, where job hunting is conducted on mobile phones rather than on desktop computers. Despite these efforts, however, LinkedIn’s disruptive impact on the $27 billion recruiting industry is evidenced in the declining stock prices of the recruiting sector’s traditional companies. For example, the stock for Heidrick & Struggles (www.heidrick.com), a search firm that courts candidates the old-fashioned way, has lost 67 percent of its value since 2008. Monster Worldwide, which operates online job boards, has seen its stock price decline by more than 80 percent. The bottom line for all job sites is that they do not want to produce 2,000 satisfactory candidates, but rather 20 great candidates. However, there is enormous overlap in what different sites offer, with each site borrowing from the others. By mid-2013, innovative technologies had increased job sites’ revenues. Questions remain as to whether the job sites are making the process more effective for job seekers. However, career coaches offer valuable tips to help you find a job. The most important secret to making online job-search sites work for you is to use them sparingly. When you are looking for a job, it is too easy to spend all day on your keyboard, combing through listings, trying endless search filters, and sending your resume into black holes. Job coaches advise you to spend 80 percent of your day networking and directly contacting the people in charge of jobs you want. Devote another 10 percent to headhunters. Spend only the remaining 10 percent of your time online. Here is how to make your time online count. To start with, as you saw above, you should have a profile on LinkedIn. Next, access the Google-like job aggregators, such as Indeed (www.indeed.com) and Simply Hired. Both of them list millions of jobs, and they make it easy to narrow your search using filters. These filters include title, company name, location, and many others. Indeed allows you to search within a specific salary range. Simply Hired lets you sort for friendly, socially responsible, and even dog-friendly workplaces. Both sites have advanced search options. Try plugging in the name of a company you might want to work for or an advanced degree that qualifies you for specialized work. For example, you could enter “CFA” if you are a certified financial analyst or “LEED” if you are a building engineer with expertise in environmental efficiency. Simply Hired has a useful tool called “Who do I know.” If you are on LinkedIn, this tool will instantly display your LinkedIn contacts with connections to various job listings. “Who do I know” also syncs with Facebook. One more trick to using the aggregators: Configure them to deliver listings to your inbox. Set up an e-mail alert that delivers new job postings to you every day. Also look for niche sites that are specific to your field. For technology-related jobs, for instance, Dice (www.dice.com) has a strong reputation. For nonprofit jobs, try Idealist (www.idealist.org). For government jobs, the U.S. government’s site is an excellent resource: www.usajobs.gov. One more great online resource is Craigslist (www.craigslist.com). It is one site the aggregators do not tap. Craigslist focuses on local listings, and it is especially useful for entry-level jobs and internships. Beyond locating listings for specific jobs, career coaches contend that job sites can be a resource for keywords and phrases that you can pull from job descriptions and include in your resume, letters, and e-mails. Use the language from a job description in your cover letter. Web sites like Vault (www.vault.com), Monster, and CareerBuilder provide some helpful career tips. Vault, in particular, offers very useful career guides. The bottom line: It is critical to extend most of your efforts beyond an online search. There is just too much competition online. Mistakes Not To Make on Your LinkedIn Profile Do have a current, professional picture. (No dogs, no spouses, no babies, etc.) Do make sure that your LinkedIn Status is correct and current. Do join groups related to your field of study or even your personal interests. Do list an accurate skill set. Do not embellish. Do not use the standard connection request. Do some research on that person, and tailor your connection request to that person. Do not neglect LinkedIn’s privacy settings. When you have a job and are looking for another one, you will want to be discreet. You can set your privacy settings so that your boss does not see that you are looking for opportunities. Do not skip the Summary. The Summary is a concise way of selling yourself. Write it in the first person. Do not eliminate past jobs or volunteer work. Do not say you have worked with someone when you have not. Sources: Compiled from LearnVest, “8 Mistakes You Should Never Make on LinkedIn,” Forbes, March 4, 2013; G. Anders, “LinkedIn’s Fast-Lane Ambition: Watch These 5 Moves in 2013,” Forbes, February 7, 2013; C. Ceniza-Levine, “What Recruiters Want from Job Seekers Today,” Forbes, February 1, 2013; G. Anders, “The Other Social Network,” Forbes, July 16, 2012; R. Sylvestre-Williams, “How Recruiters Use LinkedIn,” Forbes, May 31, 2012; T. Team, “LinkedIn Looks to Hitch Ride from Mobile Ads,” Forbes, February 14, 2012; R. Silverman, “No More Resumes, Say Some Firms,” The Wall Street Journal, January 24, 2012; L. Weber, “Your Resume vs. Oblivion,” The Wall Street Journal, January 24, 2012; S. Adams, “Secrets of Making the Most of Job Search Websites,” Forbes, January 18, 2012; G. Anders, “The Rare Find,” Bloomberg BusinessWeek, October 17–23, 2011; J. Francis, “Facebook Joins Labor Department in Online Job-Search Project,” Bloomberg BusinessWeek, October 20, 2011; F. Russo, “The New Online Job Hunt,” Time, October 3, 2011; S. Adams, “Unemployment: The Good News, the Bad News, and What to Do About It,” Forbes, April 1, 2011; K. Jones, “Online Job Searches Rise as Economy Slides,” InformationWeek, January 26, 2009; www.monster.com, www.linkedin.com, careerbuilder.com, www.jobvite.com, www.simplyhired.com, www.beyondcredentials.com, www.indeed.com, www.dice.com, www.idealist.org, www.usajobs.gov, www.craigslist.com, www.vault.com, accessed March 5, 2013. Questions 1. What are the advantages of using online job sites when you look for your first job? 2. What are the disadvantages of using online job sites when you look for your first job? What’s In IT For Me? For the Accounting Major Audit teams use social networking technologies internally to stay in touch with team members who are working on multiple projects. These technologies serve as a common channel of communications. For example, an audit team manager can create a group, include his or her team members as subscribers, and then push information regarding projects to all members at once. Externally, these technologies are useful in interfacing with clients and other third parties for whom the firm and its staff provide services. For the Finance Major Many of the popular social networking sites have users who subscribe to finance-oriented subgroups. Among these groups are finance professionals who collaborate and share knowledge as well as nonfinancial professionals who are potential clients. For the Marketing Major Social computing tools and applications enable marketing professionals to become closer to their customers in a variety of ways, including blogs, wikis, ratings, and recommendations. Marketing professionals now receive almost real-time feedback on products. For the Production/Operations Management Major Social computing tools and applications allow production personnel to “enlist” business partners and customers in product development activities. For the Human Resource Management Major Social networks offer tremendous benefits to human resource professionals. HR personnel can perform a great deal of their recruiting activities by accessing such sites as LinkedIn. They can also check out potential new hires by accessing a large number of social networking sites. Internally, HR personnel can utilize private, internal social networks for employee expertise and experience in order to find the best person for a position or project team. For the MIS Major The MIS department is responsible for two aspects of social computing usage: (1) monitoring employee usage of social computing applications while at work, both time and content, and (2) developing private, internal social networks for company employees and then monitoring the content of these networks. [ Summary ] 1. Describe six Web 2.0 tools and two major types of Web 2.0 sites. AJAX is a Web development technique that enables portions of Web pages to reload with fresh data instead of requiring the entire Web page to reload. A tag is a keyword or term that describes a piece of information (e.g., a blog, a picture, an article, or a video clip). Really Simple Syndication allows you to receive the information you want (customized information), when you want it, without having to surf thousands of Web sites. A weblog (blog for short) is a personal Web site, open to the public, in which the site creator expresses his or her feelings or opinions with a series of chronological entries. Microblogging is a form of blogging that allows users to write short messages (or capture an image or embedded video) and publish them. A wiki is a Web site on which anyone can post material and make changes to already posted material. Wikis foster easy collaboration and they harness the collective intelligence of Internet users. Social networking Web sites allow users to upload their content to the Web in the form of text (e.g., blogs), voice (e.g., podcasts), images, and videos (e.g., videocasts). A mashup is a Web site that takes different content from a number of other Web sites and mixes them together to create a new kind of content. 2. Describe the benefits and risks of social commerce to companies. Social commerce refers to the delivery of electronic commerce activities and transactions through social computing. Benefits of social commerce to customers include the following: better and faster vendors’ response to complaints; customers can assist other customers; customers’ expectations can be met more fully and quickly; customers can easily search, link, chat, and buy while staying in the social network’s page. Benefits of social commerce to vendors include the following: can test new products and ideas quickly and inexpensively; learn much about their customers; identify problems quickly and alleviate anger; learn from customers’ experiences with rapid feedback; increase sales when customers discuss products positively on social networking site; create better marketing campaigns and brand awareness; use low-cost user-generated content, for example, in marketing campaigns; get free advertising through viral marketing; identify influential brand advocates and reward them. Risks of social computing include information security concerns; invasion of privacy; violation of intellectual property and copyright; employees’ reluctance to participate; data leakage of personal information or corporate strategic information; poor or biased quality of users’ generated content; cyberbullying/cyberstalking and employee harassment. 3. Identify the methods used for shopping socially. Social shopping is a method of electronic commerce that takes all of the key aspects of social networks—friends, groups, voting, comments, discussions, reviews, etc.—and focuses them on shopping. Methods for shopping socially include what other shoppers say; group shopping; shopping communities and clubs; social marketplaces and direct sales; and peer-to-peer shopping. 4. Discuss innovative ways to use social networking sites for advertising and market research. Social advertising represents advertising formats that employ the social context of the user viewing the ad. Innovative ways to advertise in social media include the following: create a company Facebook page; tweet business success stories to your customers; integrate ads into YouTube videos; add a Facebook “Like” button with its sponsored story to your product; use sponsored stories. Using Facebook for market research: get feedback from your Facebook fans (and their friends if possible) on advertising campaigns, market research, etc.; test-market your messages; use Facebook for survey invitations. Using Twitter for market research: use Twitter Search; use Twellow; look at the chart on TweetStats. Using LinkedIn for market research: post a question (e.g., solicit advice) regarding the topic or issue you are interested in. 5. Describe how social computing improves customer service. Customers are now incredibly empowered. Companies are closely monitoring social computing not only because they are mindful of the negative comments posted by social network members, but also because they see an opportunity to involve customers proactively to reduce problems by improved customer service. Empowered customers know how to use the wisdom and power of crowds and communities to their benefit. These customers choose how they interact with companies and brands, and they have elevated expectations. These customers are participatory and have active involvement with businesses, not just as purchasers, but also as advocates and influencers. As a result, businesses must respond to customers quickly and accurately. Fortunately, social computing provides many opportunities for businesses to do just that, thereby giving businesses the opportunity to turn disgruntled customers into champions for the firm. 6. Discuss different ways in which human resource managers make use of social computing. Recruiting: Both recruiters and job seekers are moving to online social networks as new recruiting platforms. Enterprise recruiters are scanning online social networks, blogs, and other social resources to identify and find information about potential employees. If job seekers are online and active, there is a good chance that they will be seen by recruiters. In addition, on social networks there are many passive job seekers—people who are employed but would take a better job if it appeared. So, it is important that both active and passive job seekers maintain profiles online that truly reflect them. Training: Several companies use virtual worlds for training purposes. For example, Cisco uses its virtual campus in Second Life for product training and executive briefings. IBM runs management and customer interaction training sessions in Second Life as well.