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.
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