Benefits of Social Networks Use in Business-Samples for Students

Question: Discuss about the the benefits and drawbacks of Social Networks use in Business. Answer: Introduction Social networks are a system of social connections and individual relations. It is the process of increasing business connections by building new networks through social media websites. Various organisations use social networks for business transactions, to increase the speed and security of the communications. There are numerous gigantic brands such as Pepsi, Adidas, and Dominos, who have used social networks to their advantages and get success. The small and medium enterprises are still sceptical regarding the use of social media. Social media has several disadvantages along with the benefits. The risks of social networking include cyber bullying, online harassment, and cyber crimes. The report will discuss regarding benefits and drawbacks of using social networking in a corporation. Project Objective The objective of this report is to ascertain the benefits and drawbacks of social networks use in businesses. In modern times, various giant companies use social networks to increase the efficiency and security of their communications. The social networks are the significantly great place to market their products. The social network provides a significantly larger audience to appeal their products. The usage of social networks has various disadvantages as well. Project Scope The report will discuss regarding the advantages and disadvantages of adopting a social network system in the organisation. Further, the report will analyse the perspective of various companies in order to ascertain the benefits and drawbacks of using the social network in the organisation. The project will discuss the theories of various market experts to ascertain the rewards and shortcomings of using social networks. Literature review Social networks are an internet based platform to help people communicate with their friends, family, colleagues, and customers. Various organisation uses social networks in order to communicate with their employees. There are several other uses of social media, such as getting customers feedback, product marketing, market research and worldwide reach. Role of Social Networking The use of Social networks in organisations has been increased rapidly in past decade. The companies could use social networks in collecting data from customers, brand marketing, creating new contacts and communicating in the workplace. Social media help companies connecting with their customers. The organisation could get direct feedback from their customers regarding their products or services. The use of social networks is cheaper than using another medium of communication. The companies can approach a wide range of audience with the use of social media (Cheung Lee 2010). According to Holly Paquette, a professor at the University of Rhode Island, many corporations use social networks in marketing their businesses. The cost of advertising on social media is significantly cheaper than comparing to other mediums of advertisings, such as television, radios or billboards. By advertising to a larger audience, an organisation could significantly increase their sales. Social networks increase the companys engagement with their customers. The customers can give their queries or provide their feedback, directly to the corporation. Social networks help corporation in enhancing their business outside their domestic country. The company can market their products or services easily in the foreign markets, with the help of social networks. The organisation could increase their foreign contacts with the use of social media. The corporations could conduct market research with the social networks to recognise their brand's reputation in the market or the requirements of their customers. Following are some ways in which an organisation can use the social network in business (Aral, Dellarocas Godes 2013): Increase the efficiency of targeting customers Expansion of customers Instantaneous feedback from consumers Cost efficient Help in creating better customer relationship Building brand awareness and increase the exposure of company Benefits of Social Networks In modern time, a company can benefit heavily from adopting a social network strategy for their organisation. For sustaining grow of an enterprise in the future, implementing social network policy in business is essential. The advantages of adopting a social network policy include cost reduction, expansion of companys audience, better marketing exposure, faster growth, quality communication and instant feedback (Woodcock, Green Starkey 2011). Marketing According to the research conducted by Brennan (2014), Social media is an essential part of every company marketing policy. More than 90 percent of market experts have claimed that social media expands the exposure of an organisation. The use of social network strategy significantly reduced the time and resources spent by companies on marketing. Following are the benefits of marketing a company on social networks: Expansion of Brand Awareness: Using a social network marketing policy can increase the business visibility in the market. The social networks assist companies in engaging with a wide-ranging audience. It is easy for an organisation to market their products in various countries. Increase in Inbound Traffic: If a company did not imply a social media strategy, the inbound traffic is restricted to its usual consumers. The organisation can in increase its audience by marketing their products online. Improved Customer Satisfaction: Social networks provide the customers a place for communication and interacting with the company. Customers can directly post their feedback or quarry on organisations website and the enterprises can get a better knowledge of their customers requirements. Cost-Effective: The companies can significantly reduce their cost of marketing by adopting social network strategy. Most of the social networks are free and many have comparatively lowered costs related to other marketing strategies. The research of Manthiou (2012) proved that various companies have used the social networks to their marketing advantages. The organisation, such as Pampers, Netflix, Old spice, Staples and many others, uses their social media posts to market their products online. These companies get involved in popular culture news and use them to market their product online. Wendys, a popular American fast food chain, uses the social media to post funny things which create a popular image of the brand in the customer's mind. Communication An organisation can increase the efficiency and security of communication, between employees, clients, and suppliers, by adopting a social network method for communication. The companies can implement both internal and external communication platforms. There are several advantages of using the social network for communication such as (Sarker, Ahuja, Sarker Kirkeby 2011): The employees can discuss ideas, post quarries and share news regarding their tasks. The social networks allow employees to easily collaborate on business projects. Social networks assist in faster decision-making between employees because it is easier for them to give feedback or ask a quarry. The companies can introduce self-help groups in employees to reduce their work stress and motivate them to share their problems. It helps the company in building a strong culture at the workplace. Social networks help in widen an organisations business contacts. The companies can increase their communication and networking with their suppliers or business partners. Implementing social network policy increases the reputation of an organisation. The enterprise can increase its connections and find new business opportunities for the organisation. Better communication with customers increases the brand loyalty of the company. Social networks assist in market research, implementing campaigns and straight communication with interested persons. The organisation can evaluate their place in the market and create future strategies by analysing their customers. There are several new applications that companies used to increase their workplace communication. The application such as Slack, Socialcast, and Yammer help increase the efficiency and security of internal communication. The communication softwares provides facilities such as team collaboration, easy file sharing and group chat to increase the productivity of employees (Lanubile, Ebert, Prikladnicki Vizcaino 2010). Increase in Sales The organisation can significantly enhance their market share by approaching to a newer audience. New customers can find a companys products by searching for similar things. The use of social networks gives a company truly global approach in the market. The customers in different countries can easily find and buy products of companies, this approach helps in enhancing sales of the organisation. With the increase in ecommerce websites, companies can easily import or export products from various countries. Traditionally, the organisation has local customers and to increase their sales they have to open new outlets, but with the help of social networks, one shop can sell its products worldwide (Stephen Galak 2012). The online shopping market is booming with giant players such as Amazon, Wal-Mart, and Alibaba. A research conducted by Robischon (2017) provided that Amazon is one of the largest electronic commerce or online shopping company in the world. The company had revenue of US$135.98 billion in 2016 and on a peak day the company sold more than 26 million items. The social networks provide customers the facility to order from their home and choose from a vast variety of items. Research Online platforms enhance communication between the company and its customers, helping them in creating better products according to customers requirements. The research of Bryman (2015) showed that the organisation can engage with their audience and improve their relationship by using social networks. The market research helps companies to know their worth in the market and the desires of consumers. The employees of an organisation can post their ideas and quarries online which assist the company in creating the better working environment. Drawbacks of Using Social Networks For the past decade, the social networks have grown rapidly in the daily activities of organisation and individuals. The companies use social networks for various purposes such as marketing, research, online sales, and communication. The social networks have numerous benefits but there are several drawbacks as well. The disadvantages of social networks include cyber crimes, hacking, security issues, false advertising and daily monitoring (Belbey 2015). The companies should analyse these drawbacks while adopting a social network strategy. Hacking Hacking is the process of obtaining unauthorised access to information in a computer or system. Many people hack the systems of large organisation in order to collect sensitive data for their advantages. The paper of Collins (2008) discusses that using social networks increases the chances of hacking in an organisation. The companies have to pay high amounts to get firewalls or security to avoid hacking, which are not benefitial for organisation. In past few years, many popular companies have become the victim of hacking such as Yahoo, Ashley Madison, Sony, HBO, Home Depot, JP Morgan, eBay and many other companies. Ashley Madison suffered huge losses due to the hacking of their user's profiles. The significant loss is suffered by HBO after leaking of their hit popular series episodes Game of Thrones on the internet. The hackers leak the sensitive data of the company and their users on the internet, such as passwords, bank information, and personal data (Groden 2015). Inside Risks The companies have to check their social media accounts many times in a day because dissatisfied consumers or workers can post deleterious comments that are not always removable. There is a risk of human error as well. The organisations have to invest addition costs for securing their data. According to Rosenblatt (2015), the inside risk on social networks is high because unlike hacking it is done by inside persons. The attack on Morgan Stanley was a good example of inside attack on the company. According to cyber security expert Lucas Zaichkowsky, there is a high probability of insider attacks happening and there is nothing that companies could do to stop such attacks. Clear Strategy The companies are required to create clear and strong social networks strategies. Not having a clear policy for marketing or social networks could decrease the benefits of an enterprise. The strategy should cover all the aspect of the business and must approach to a larger audience. The cost of hiring an outside expert for creating strategies could be significantly high. The social network strategy impacts the reputation of a company online and one mistake could reduce the status of the company. The giant players such as Coca-Cola have made a mistake in their social network strategy. The company tweets a photo of snow covered Russian map, omitting Kaliningrad. The Russian gets angry and poured the Coca-Cola soft drink in the toilets with Ban Coca-Cola hash tag. Seoul Secret, a beauty products enterprise, runs a campaign saying White makes you win, causing social media backlash on the company (Friedman 2016). Cost In order to secure their social media accounts, companies have to invest heavily on firewalls and security software. The cost of this software is high and the company has to keep them updated along with new updates. An average company spends around $15 million for security against cyber crime. According to Gartner, the worldwide spending on cube security reach around $90 billion in 2017 and it will estimate to be around $113 billion on 2020 (Muresan 2017). Time Waste The employees of the company could use their social networks to engage in their personal life instead of working in the office. The social networks are addicting, and they could reduce the productivity of employees. According to a survey by Mangus (2014), more than 89 percent employees admitted wasting their time by using social media at the workplace. Harassment The increase in the use of social media enhances the cyber bullying and harassment between the employees. Many workers have reported by claiming that they have been harassed or bullied on the social networks of their company by their colleagues. The harassment raises the concern such as depression, suicide, a decrease in companys reputation and unhealthy environment at the workplace (Van Laer 2014). Conclusion The above report concluded that in the modern time's companies have to use Social Networks in order to a competitor in the market. The social networks provide several benefits to the organisations, such as marketing, research, feedback, and increase in sales. But along with the advantages, there are numerous drawbacks as well. The companies put themselves at security risk by using social networks. The disadvantages of social networks include hacking, data leaks, cyber crimes, harassment, and bullying. The strategy of a company should be clear regarding the use of social networks and collective measures should be taken to save their data and clients from cyber-attacks. References Aral, S., Dellarocas, C., Godes, D. (2013). Introduction to the special issuesocial media and business transformation: a framework for research.Information Systems Research,24(1), 3-13. Australian business and social media. (2016).Platform Communications. 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