While midmarket companies find social media sites alluring, recent surveys suggest that many question its true business benefits.
Small businesses are unsure about the impact of social networking on
reaching customers, according to a recent survey from RatePoint, a provider of
customer reviews, testimonials and online reputation-management services. The
survey revealed that while 36 percent of small businesses agree their customers
spend time on social networking sites, 27 percent are undecided and 20 percent
disagreed that their customers were spending time on social networks.
Small businesses also are conflicted about the use of social media for business,
according to the results of RatePoint's survey, which is based on a poll
conducted in August of more than 150 small businesses, most with five or fewer employees.
Twenty-five percent of survey respondents agreed that their customers want to
hear from them on social networks, while 36 percent disagreed and 20 percent
were undecided. When asked if social media is a quick way to connect with
prospective customers, 35 percent of businesses surveyed agreed, 28 percent
disagreed, and 22 percent were undecided.
However, the survey also found small businesses that are proactively using
social networking to reach customers are finding a strong return. Of those that
indicated they would be using social media as the main tactic to drive new
customers to their business in the next 12 months, 70 percent said they do so
because social media is the least expensive option.
"Social media use is no longer limited to one demographic; everyone is
adopting," said Neal Creighton, CEO and co-founder of RatePoint. "While many
small-business owners are uncertain, big brands are investing heavily in social
media. Social media can be a great equalizer for small businesses to compete
alongside larger brands, and SMBs are missing out if they are not involved."
While small and midsize companies often think managing social media is time-
and resource-intensive, many SMBs have found tools to help them make the process
more efficient and effective, Creighton explained. "SMBs need to talk to
customers via social media so they can find how to meet customer needs, build
relationships and make sales," he said.
Research from Internet market monitoring specialist eMarketer shows an
estimated 57.5 percent of all U.S. Internet users, or 127 million people, will
use a social network at least once a month in 2010. By 2014, nearly two-thirds
of Internet users will be on board.
IT research firm Forrester reported that while young people continue to
march toward almost universal adoption of social applications, the most rapid
growth occurred among consumers 35 and older.
Despite the benefits social media can bring to small businesses, another recent
report from Panda Security found social networking sites can be dangerous for
midmarket companies. A September survey of 315 SMBs with up to 1,000 employees
revealed 33 percent of these companies had experienced a malware or virus
infection from social networks, with 23 percent citing employee privacy
violations resulting in the loss of sensitive data.
The Panda survey found that to minimize the risks associated with social media,
57 percent of SMBs currently have a social media governance policy in place,
with 81 percent of these companies employing personnel to actively enforce
those policies. In addition, 64 percent of companies reported having formal
training programs to educate employees on the risks and benefits of social
media. The majority of respondents (62 percent) did not allow the personal use
of social media at work.
Nathan Eddy is Associate Editor, Midmarket, at eWEEK.com. Before joining eWEEK.com, Nate was a writer with ChannelWeb and he served as an editor at FierceMarkets. He is a graduate of the Medill School of Journalism at Northwestern University.