Bridging the gap between Facebook and business.

Author:Coleman, Linda Jane


Social media's influence is constantly expanding as more people join online communities every day. Social media platforms are maturing into serious communication channels that facilitate problem-solving in creative and unexpected ways for commercial purposes, educational institutions, government and not-for-profit organizations, and for crisis responders and crisis response efforts (Perkins, 2010). Facebook is one of the more prominent social networking sites and has experienced an incredible amount of growth: Facebook's active monthly user population has grown from 200 million users in 2009 to 1.35 billion users in the third quarter of 2014 (Statista, 2014). Of these users, more than 60% of them use Facebook every day (Swani et al., 2013). In a 2009 study of social media sites, it was estimated that 50% of the U.S. population had some version of social media profile. (Mathur et al, 2012; Stelzner, 2009). To better understand the reach of social media, one must look at its components as well as the types of people who utilize these sites.

Consumers are increasingly adopting social networking, engaging in micro-blogging and downloading applications for smartphones and tablets. Along with sharing and communicating with friends about their social lives, updating pictures and posting status updates, customers and members of society have found that social media applications can empower them as they navigate through the abundance of information available online (Andzulis et al., 2012; Richardson, 2010). In 2013, 29% of Facebook users reported clicking the "like" button on other users' statuses or generated content several times per day (Statista, 2014). On an organizational level, firms have not readily adopted these technologies, but are quickly seeing the potential value in their use. For example, Ford Motor Company employed social media to promote the release of their new model Ford Focus. Ford distributed videos of social media practitioners on a test track via Facebook, Twitter and other social media platforms and received positive feedback from consumers (Levin, 2011; Andzulis et al., 2012). Additionally, Business Insider reported that Procter & Gamble proposed to lay off about 1,600 staffers, including marketers, as part of a way to cut cost from their advertising budget, since advertising on Facebook costs less than the traditional media used for advertising (Andzulis et al., 2012; Edwards, 2012). Using Facebook also allows brands to create brand communities without the effort of building or owning external online platforms or promoting independent websites. Using social networks allows a brand access to large numbers of customers at low costs and high speeds. Social networks, such as Facebook, are also ideal for creating loyal brand communities and effective customer-to-customer based information exchange (Zaglia, 2013).


Social commerce refers to the use of social media to assist in the online buying and selling of products and services. This practice leverages social shopping behaviors when online shoppers interact and collaborate during the shopping experience. Social commerce channels include review and ratings sites (i.e., Epinions and Yelp), deal sites and deal aggregators (i.e., Groupon and Yipit), social shopping markets (i.e., Etsy) and social storefronts (i.e., Levi's Friends Store) (Tuten & Solomon, 2013). Organizations can socially enable aspects of their traditional e-commerce websites by using tools such as Facebook Connect (a Facebook tool that allows users to log in to other partnering sites using their Facebook identities) and Share applications (tools that let users share what they are reading or doing on their status feeds).


Due to the rapid growth of social media, marketing professionals have found a new outlet that can potentially increase the interest in a product or services (Mathur et al., 2012). This has important implications for customer lifetime value (CLV) considerations and related interest for advertisers who are deciding whether investments in social media are cost effective. Social media marketing is a hot current topic of interest for many organizations worldwide. It is a relatively new technique for many organizations and there is much uncertainty about the overall impact on the growth and expansion of the company. Social media sites such as Facebook challenge managers with the decisions of how and when they will incorporate this opportunity (Flartzer, 2010; Mathur et al., 2012).


Facebook is the dominant social networking site, with an audience of approximately 160 million U.S. visitors each month. If Facebook were a country, it would be the third most populous in the world. It accounts for 90% of all time spent on social networking sites. Facebook offers synchronous interactions (which occur in real time, such as when texting back and forth with a friend) and asynchronous interactions (which do not require all participants to respond immediately, as in emailing a friend and getting an answer the next day), photo sharing, games, applications, groups, e-retailing and more. Branded content on social media can take many forms, among them content shared directly from brands, re-shared content from connections and social marketing tools, such as Facebook's "Sponsored Stories" advertising unit. There has been a focus on counting the incidence of these brand mentions on social networks and categorizing it. The reach and frequency of social-media brand impressions are far more important than simple counting statistics (Lipsman et al., 2012; Tuten & Solomon, 2013).

Facebook users spend more than a fourth of their time on the site consuming and interacting with the Facebook Newsfeed, which represents 4% of all time spent online in the United States (Lipsman et al., 2012). The Newsfeed is also the primary location where branded content is consumed. Users are 40 to 150 times more likely to consume branded content in the Newsfeed than to visit the Fan Page. There are potentially two audiences for branded content on Facebook: Fans of brands and friends of fans.

Fans of brands on Facebook (those who have explicitly "liked" a brand) are the easiest to reach with social-media brand impressions (Lipsman et al., 2012). The act of "liking" a brand on Facebook is equivalent to sharing information with all of the connections within a user's social network (Swani et al., 2013). Friends of fans typically represent a larger set of consumers (34 times larger, on average, for the top 100 brand pages) and can receive social media brand impressions by way of their friends. The reach of branded content among friends of fans exceeds the reach among fans. When a brand focuses on acquiring and engaging fans, it can benefit from the significant secondary effect of exposure among friends of fans that often goes beyond reach among fans. Facebook fans may have different aggregate demographic and behavioral profiles for some brands than typical brand purchasers, which implies that social media may require varying approaches to marketing strategy. The "value of a fan" can be assessed in three primary ways: increasing the depth of engagement and loyalty among fans, generating incremental purchase behavior and leveraging the ability to influence friends of fans (Lipsman et al., 2012). Companies also benefit from...

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