Social Media Is an Extremely Hot Buzzword

Social media is an extremely hot buzzword in the business world today. However, it is not just a buzzword. According to Andreas Kaplan and Michael Haenlein, social media is "a group of Internet-based applications that build on the ideological and technological foundations of Web 2.0, and that allow the creation and exchange of user-generated content." (Kaplan, 2010, p. 53) As this paper will demonstrate, social media has had a tremendous impact on the business world particularly in the areas of marketing and public relations.

Marketing

Social media is revolutionary is that it relies on consumer-to-consumer communications, whereas most marketing operations rely on business-to-consumer communications. (Mangold, 2009, p. 358) Consumer-to-consumer communications are much more natural and comfortable for the average person than listening to a sales pitch or an infomercial. With social media, consumers can learn about a company's product in an informal, interactive, and pressure-free environment.

Another key element that distinguishes social media is consumer-generated content. One example of this is the restaurant review website Yelp.com, where consumers submit ratings and reviews of restaurants that they have eaten at. All of the content, even the listing for the restaurant itself, is created by consumers, not by the employees at Yelp.com or by the restaurant-owners. This allows restaurants without aggressive marketing operations to be known by a much larger audience.

In Socialnomics, Eric Qualman declares that social media has revolutionized almost every facet of our business and personal lives. Qualman defines "socialnomics" as "…the value created and shared via social media and its efficient influence on outcomes (economic, political, relational, etc.)." In practical terms, this means that, in the future, "we will no longer search for products and services, rather they will find us via social media." (Qualman, 2010, p. xxi)

Social Media, however, may not be completely revolutionary. Many individuals with a background in traditional marketing will recognize many of the tactics employed in social media marketing. Essentially, much of social media marketing is word-of-mouth marketing. The difference now is that word-of-mouth can be expressed and heard anytime and almost anywhere. Many business owners agree that word-of-mouth is, by far, the most effective form of marketing in terms of cost and time, certainly far more than so than advertisements and solicitations.

Social media allows people to exchange information with incredible speed and ease. More importantly, it is targeted information. Social media allows people to receive information which they would actually find interesting, unlike, for example, junk mail advertisements. Social media enables this sort of targeted information because it is organic and bottom-up, unlike traditional marketing "strategies," which are pre-formulated and planned in a top-down, goal-driven fashion.

Public Relations

Social media has changed the way people get information, even traditional news. The Mumbai Hotel Bombings, a global news event, was publicly "broken" as a news story by a live witness of the events using his Twitter account. The Mumbai Hotel Bombings were all over the web just moments after they occured, with reactions and analysis following just as quickly.

Usually, the general public relies on major news outlets, such as the New York Times, to notify them of any events worthy of note. In fact, New York Times boasts that it covers "All the news worthy of print." Now, anybody with a cellular phone can break a news story. This means that it is not just the New York Times now that will determine what "news is worthy of print." Because the news can come from anywhere, the flow of information is much harder to control (for people who want to control it).

The field of Public Relations is about the presentation of information, which means controlling the flow of information. Typically, a company's Public Relations department will control the flow of information by setting the agenda, in other words, dictating what is worth talking about. This is done sometimes through official press releases but sometimes through interviews or even through paying members of the media to write certain stories.