The Pit - IMI Trust

Let me introduce you to a few companies… Microsoft, Google and Apple you probably already know…do you know MySpace, Facebook, You Tube, Second Life, Mixi and Technorati?

These companies are leading the way in Social Media. By definition, social media describes the online tools and platforms that people use to share opinions, insights, experiences, and perspectives with each other.  Social media can take many different forms, including text, images, audio, and video. Popular tools that foster social media include blogs, message boards, podcasts, wikis, and vlogs (video logs).

So how does any of this relate to you and the building of your business?

The internet is the self-titled ‘Information Superhighway’ but now there are so many people, all over the world spending hours online, they discover information and want to share or spread the word.  Social media has become a buzz word for people connecting online.

Humans by their very nature are social animals and look for places to meet, express and discuss.  This doesn’t have to happen in a cafe it can happen at your website.

The notion of social media is so popular that MySpace was purchased for approximately US$580Mn by News Corp last year.  The fastest selling album in UK history first appeared on MySpace and the marketing was driven by pure word of mouth.  The majors in the music industry now use MySpace as their main tool to promote their music. Type in an artist into a search engine and you are likely to find their MySpace site.

Mixi is Japan’s answer to Myspace. On the day it listed in Japan, it’s shares traded at nearly 90% increase on the value on its list price helping to make its 30 year old owner a billionaire. Yahoo are reportedly looking to purchase the company Facebook at around the US$1Bn mark as it has an established social network in place.  The Sun Microsystems CEO, Jonathan Schwartz, communicates directly with his audience though his blog and Microsoft are reported to have allocated US$200Mn for advertising on one Social Media site.

A more peculiar version of the phenomenon is Second Life. As at September 2006, Second Life has around 764,000 user accounts and approximately 50% of those active over the previous 60 days.

It is an online community within a 3D world, where you can participate in a virtual world with its own society, economy and ecology.  Strangely, it has begun to operate as a ‘real’ market. If you visit Second Life, you can see exactly how much ‘thin air’ has been purchased that day. When I looked, there was over US$410K in transactions which had taken place. Amazing when there are no physical deliverables.

Similarly, people are purchasing tools on Ebay to help them succeed in the game World of Warcraft. Parents with teenage sons would know of the game well. There can be a downside to this as we attended a conference in Thailand and an attendee explained his addiction to the game was so strong that he lost his business from playing the game up to 16 hours a day.

Social Media is the next generation of Marketing. The challenge for businesses is to be able to create an online community that people want to be a part of. Social Media allows you to connect with you clients like never before.  You may not have a game or music but you have valuable information that people want to know about and discuss.

To all the Bears and Bulls in ‘The Pit’ what is your experience with Social Media? If you say the answer is none then you are wrong, you are reading this…

I Don’t Agree - But At Least I Have Someone To Discuss It With