Whitespace: Proximity matters - SMEs get geosocial
Issue 60: April 2010
Two major developments are on the horizon in the social media space.
The first is the growing realisation by SMEs that social networking is vital to their existence. The second is the rise of geosocial networking – social media tools that automatically reveal the location of their user.
Bring these two movements together and you have a powerful trend; one that will see business, especially small ones, using their local knowledge to understand their clients like never before.
Small meets social
Figures out last week from research firm Nielsen suggest Australian SMEs are rapidly tuning into the power of social networking.
The report claims SME are embracing social media as a marketing channel faster than any other business sector with 67 per cent saying they are adopting Web 2.0 tools, an increase from 32 per cent in 2008.
Clearly small businesses have come to realise that reputations can be made or broken though digital word-of-mouth, and many are also acutely aware this process can unfold over a matter of minutes rather than years.
But social media facilitated word-of-mouth is just one potential benefit (and risk) for SMEs. With the proliferation of smartphones across the globe, social media use itself is changing – it is increasingly becoming a mobile phenomenon.
Just when you thought social media couldn’t be any more revealing, a new development looks set to serve up even more information about users. In the near future Facebook is expected to announce a new function that will allow its 400 million users to automatically reveal their location.
According to the New York Times, this location feature will have two aspects. Firstly, Facebook users will be able to share GPS and mobile phone tower derived location details with their friends as part of their status updates.
But in addition, Facebook will allow third party software developers to weave location-based information into social media applications. This means Facebook users can soon expect to be offered a number of location-based games and tools as part of their social media experience.
On the face of it, this move could appear to be a case of more banal detail being swapped amongst social media devotees. But commentators say geosocial networking presents a range of valuable opportunities with some claiming location-based social media industry will be worth US$3.3 billion by 2013.
It’s hip to be FourSquare
Facebook's decision to reveal the location of its users is a reflection of the success experienced by a number of smaller social media players that invite users to ‘check-in’ with their locations.
One of these is FourSquare, a one-year-old smartphone application that updates the location details of its million or so users so they can connect with friends in the same area.
But there’s more to checking-in than just meeting up with friends. FourSquare attempts to make a points-earning game out of the process by ranking players who visit specific locations and allowing top visitors to become a place's "mayor".
Fun and games aside, FourSquare and other similar websites have emerged as a means to attract customers, promote products and services as well as measure feedback. Indeed, the company is focused on attracting businesses to be part of its game.
Starbucks has recently joined forces with FourSquare to use geosocial media as a means of unlocking "the pulse of the experience" for each store; US frozen yoghurt company Tasti-D-Lite has already started to use FourSquare as a ready-made platform of its customer loyalty program.
Without doubt, signs are emerging that a powerful new marketing tool has been born, one that can help companies to understand their customers in a whole new light.
It’s all about patterns
The use of social media as a means of listening to customers has been well documented but geosocial networking could take this one step further.
In the geosocial world it’s not just about what social media users are saying, but also where they say it, and even how they live their lives. Whether you’re a big or large company a little data crunching using online analysis tools can result in a big picture of consumer behaviour patterns.
Regardless of whether smaller social media sites like FourSquare turn out to be bigger than Facebook or merely fade off the radar, one thing is for sure: geosocial networking will be a gamechanger once the world starts checking-in and SMEs start checking out this information.
Whitespace is published monthly by the Australian Institute of Management - Qld & NT. Sign up to have a copy sent direct to your mailbox.