How to Use Social Media to Build Valuable Business Relationships
Even though social media platforms such as Facebook and Twitter are taking the world by storm, it still can be challenging for many businesspeople to know how to harness the power of social media platforms for business. However, if you understand the ubiquitous ATM offered by banks, you can understand much about what it takes to succeed in social media business communication. With this analogy and a lesson from the world of economics, Knowledge Center contributor Mark Philips explains here why meaningful relationships define social media business success.
The invention of the ATM decades ago revolutionized the banking industry. ATMs could be placed just about anywhere, on relatively short notice and with relatively low resources. The most simple of banking transactions became much easier to accomplish and cash became much more accessible.
Today, social media is taking the world by storm. But "a location on every corner" is not enough to succeed in online business. In business today, meaningful relationships are the currency of the social media ATM. Consider the following three comparisons:
1. ATMs make it cheap, fast and easy to withdraw cash. Social networks make it cheap, fast and easy to exchange information.
2. There's an ATM on every corner. There's a social media bookmark or application on every laptop and smartphone.
3. Most ATM patrons look over their shoulder during transactions. Most social media users likely don't but perhaps they should.
The velocity of money and information
A brief economics lesson shines even more light on the comparison and its application for business professionals. In economics, the concept of the "velocity of money" describes the frequency with which a unit of currency is used. In essence, this is the number of times a dollar circulates within an economy over a certain period of time. In a different era, this measure was considered a viable indicator of the health of an economy.
The advent of the ATM increased the velocity of money significantly. Transactions took place more often, with money flying rapidly from ATM to pocket to cash register to business bank accounts faster than ever before. Where the speed at which money flew around the economy once indicated the health of the nation's business community, it became clear after the rise of the ATM that high velocity did not necessarily indicate economic health. Banks' ability to reach customers was greatly improved, but that did not necessarily create value for the customer or help the customer (or individual banks) to grow.