Home > English, World Events > Risks and Rewards of Using Facebook and How They Affect Corporate E-Commerce Tactics

Risks and Rewards of Using Facebook and How They Affect Corporate E-Commerce Tactics

By Marquis Codjia

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The estimated half-billion Facebook current users form a gigantic market for global business and a chief barometer in other sectors, including politics, mass media, sports and charitable undertakings. Given its user diversity and geographical expansion, the leading social portal constitutes a digital populace akin to a global organization.

In fact, Facebook has morphed lately into an “online United Nations” – if nothing else, when factoring the fraction of the world’s population that is computer-literate.

Facebook users can be cross-analyzed in multiple ways, based on the aim of the analysis; however, for the sake of simplicity, two areas can be retained to depict the membership diversity.

The first area is anthropological, and is indissolubly tied to basic human gregarious instincts. Members can register as individuals and invite friends – and friends of friends – to create and maintain their own social groupuscules, or networks. With other fans, they share their admiration for a company, a brand, a product, or an individual. They show their commitment for a cause by joining groups or forums. If they feel playful, they indulge in games, quizzes or other entertainment conduits available on the website.

Second area is socio-economics. Members can identify as individuals – that is, consumers, or the demand side – or organizations – that is, producers, or the supply side. The latter group can be further divided into businesses, non-profits, politicians and entertainers.

To individual users, Facebook offers many an advantage. Users can search for new or old friends, interact with them, and expand their networks to other individuals who share their likes and dislikes – via friends of their friends or groups in which they maintain membership.
They access helpful information that otherwise may be unavailable to them – academic work, research papers, web premieres of electronic products, etc. Members can also share pictures, video and audio content, and in that process, use the portal as a powerful dating or matrimonial agency.

Such intermingling is useful because it allows users to fearlessly communicate with acquaintances as well as strangers, and provides an empirical illustration of the six-degrees of separation theory.

The six-degrees of separation theory – also called the “Human Web” theory – explains that everyone is at most six steps away from any other person on Earth, because each person is one step away from another person they know and two steps away from each person who is known by one of the people they know.

Disadvantages to Facebook individual users relate mainly to privacy and productivity.

Unmistakably, the risk of public exposure is inherent in any online presence, be it social portals or other forums; Facebook members thus relinquish part of their privacy simply by registering and posting status updates on their “walls”, since no one knows with a high degree of certainty how member data is managed. This privacy breach is compounded by inadequate privacy settings that most users, especially minors and the elderly, have in their accounts, leaving them vulnerable to online predators and other mischievous acts. Members – unwillingly and unbeknownst to them – can be tagged in pictures and writings that provide an uncanny or inaccurate depiction of their personality, views or interests.

Simply put, Facebook can erode or destroy one’s reputation over time unless a member controls strictly how their information is disseminated.

Privacy infringement can also occur via the portal’s plethora of applications; these tools are formidable marketing conduits to collect valuable information – including emails – about members, which can then be monetized with legitimate businesses or illegal organizations (e.g. spammers). For example, think about a quiz like “What will your wedding dress look like?” and how respondents, credulous that they’re partaking in a game, can unawares provide useful data to a vast number of players in the wedding planning industry.

On the productivity front, Facebook usage favors a climate of procrastination and addiction that comes with the various features (e.g.: games) existing on the portal. This behavior is however excellent for the company because the more time users spend on the site the better.

For organizations and celebrities, including politicians, a Facebook presence offers many rewards and relatively few, if any, negligible risks. This absence of detriment is a consequence of the sophistication of risk management and brand promotion techniques that these entities use, and the built-in features available on the site. Since corporate persons have full control of their accounts, they view their Facebook pages as natural extensions to their websites or intranets.

The rewards to this group relate primarily to the enhancement of their brand appeal and their online commercial strategy. A Facebook presence furthers a paradigm shift in e-commerce tactics. Organizations can gauge their “online market share” and popularity level by their number of fans vis-à-vis the competition, and slice it demographically into desired niches or strata, even though such number may arguably not be reflective of actual market size and characteristics, and may not translate necessarily into real consumers.

Having admirers listed on their pages or related groups is precious because businesses and celebrities have at their disposal a free and valuable database of potential, loyal customers to whom they can pitch their new products or services. Newsletters, quizzes, and applications from Facebook offer a direct way to conduct market research cheaply and collect firsthand consumer feedback. For example, a firm may test a new concept with Facebook fans, or a representative portion thereof, prior to advancing its R&D process and launching a new product.

Formal announcements can also be directly disseminated, in real-time, to vast swathes of the clientele. Other interesting features are Facebook Ads, a service that allows sponsors to target specific demographics, and Marketplace, a digital market where products can be marketed directly to patrons.

  1. Obi
    April 11, 2010 at 9:23 pm

    FB is definitely the best invention in my view, after the internet!

  2. JPM
    April 11, 2010 at 9:23 pm

    Great article

  3. Seek
    April 11, 2010 at 9:24 pm

    Thanks for sharing this, I learnt a lot.

  4. Comord Man
    April 11, 2010 at 9:24 pm

    Excellent!!!!!!

  5. FeverF
    April 11, 2010 at 9:25 pm

    Also need to look at privacy settings in FB ‘coz that’s what killed Myspace.

  6. Raissa L
    April 11, 2010 at 9:26 pm

    Love the post, thx!

  7. Close156
    April 11, 2010 at 9:26 pm

    Thx for the artilce

  8. Aussie Sean
    April 11, 2010 at 9:27 pm

    Great insight, lov it!

  9. Shet
    April 11, 2010 at 9:27 pm

    Will add to my FB, thx

  10. Jay
    April 11, 2010 at 9:28 pm

    Great work

  11. Shoff Waad
    April 11, 2010 at 9:29 pm

    Facebook is revolutionizing ecommerce and it’s a trend nobody can stop.

  12. MR
    April 11, 2010 at 9:29 pm

    Good analysis

  13. Al Reab
    April 11, 2010 at 9:30 pm

    I always filter my friends on FB to make sure I know them

  14. Michelle
    April 11, 2010 at 9:33 pm

    gr8

  15. Peter
    April 11, 2010 at 9:34 pm

    I think ecommerce will not change much the way we do business or how customers buy because of the fact that we humans and we wont change because a computer tells us to do so.

  16. BankGuru
    April 11, 2010 at 9:36 pm

    thx for sharing this

  17. Mac
    April 11, 2010 at 9:37 pm

    great story, i just signed up

  18. Markt
    April 11, 2010 at 9:40 pm

    3d browsing is the next ecommerce thing

  19. York
    April 11, 2010 at 9:42 pm

    I love Facebook! I’ve reconnected with people I’d lost touch with and I’ve connected with a load of new people too. I like FB for the games and other applications and find it is just very enjoyable but it’s all to do with personal preference really. Some people love it and some don’t.

  20. JohnV
    April 11, 2010 at 9:45 pm

    There is nothing special about any social network. They all have a few individual features but the rest is the same – you set up a profile and network with your friends. When people go on about one, they only go on about it because all their friends are on it. If all your friends were on myspace, you wouldn’t go about Facebook would you? I would say that Facebook is the worst of all of them though. Especially since they re-designed the layout of it. But that’s just my opinion. I like the fact thay you can customize bebo alot though. I know you can customize myspace even more but my firends aren’t on there.

  21. Bamba
    April 11, 2010 at 9:46 pm

    I go on face-book because it is a way of keeping in contact with my friends. I don’t have much money, nor the time to go see them as I live far away. Some of my Friends are also in australia, spain and finland.

    with Face-book I can write on their wall, email them, and see photo’s of my Friends children or places they have been.

    I can invite my Friends to my parties, or be invited to theirs.

    I also enjoy changing my status…”bamba is….” as it’s fun trying to think up fun versions.

    Some people I know on there add as many people as possible to be their ‘Friends’, even people they hardly know, so they can seem popular. I only have people i actually speak too.

  22. Lovely
    April 11, 2010 at 9:47 pm

    I like it because it’s the true friendship test. If you know them and they seem to add everyone else who is a mutual friend but you, it tells you how they really think of you. It sucks and it’s not a good feeling, but at least you’ll know the truth and can just forget about them.

  23. BO
    April 11, 2010 at 9:48 pm

    fb its a great way to keep up with old friends that you don’t get to see much anymore. Its also good because you can still see what’s going on with people that you know but that you don’t really talk to anymore…. like old high school classmates and stuff like that.

  24. Terminator
    April 11, 2010 at 9:49 pm

    the only cool thing for me abt fb is that i have reconnected with people Ive lost touch with over the years

  25. Biddingboard
    April 11, 2010 at 9:50 pm

    I like fb because it simple easy to search for friends and add them. Its like the grown up version of myspace.

  26. April 15, 2010 at 8:48 am

    My cousin recommended this blog and she was totally right keep up the fantastic work!

  27. Lea
    April 15, 2010 at 11:52 pm

    cool post

  28. Meghan178
    April 15, 2010 at 11:53 pm

    FB shd implement more privacy features lest they have the same fate as the late Myspace.

  29. Mike
    April 15, 2010 at 11:54 pm

    as facebook grows, so become the threats.

  30. May 14, 2010 at 2:49 pm

    Facebook wont be stopped unless something can out do them

  1. April 15, 2010 at 10:56 am

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