The promise of the Internet age was the end of business as usual. Instead much of the business world has resisted the paradigm shifts of Web 2.0 and social media, but the Great Recession may prove the tipping point for widespread adoption.

Benjamin Tomkins, Contributor

June 22, 2009

4 Min Read

bMighty: How can small and midsize businesses harness Web 2.0 platforms and social media to compete?

Fraser: Ironically, SMBs are much more open to deploying social media and Web 2.0 tools than large corporations, but they struggle with how to deploy it in a productive way. Large multinational companies use Wikis to foster inclusion and collaboration within the company. The technology allows them to transcend space and time constraints to get all the brains on the Wiki. But SMBs don't have offices around the world, so the question is how to use these platforms for what they're doing. The way that many smaller companies have used social media is for marketing, getting their products and services into the conversation, and leveraging their small status to adapt quickly.

What's true of Web 2.0 platforms, because of the open access nature, is that they make mass production, marketing, and media available to smaller organizations that have never had access before because of economies of scale. GE and Coke can buy an ad on television to promote their product; no small business can afford that. But the thing about viral marketing on the Web is that it makes mass media almost irrelevant and lowers barriers to access. Small companies and individuals can get their message out there. It levels the playing field by eliminating barriers -- it's a powerful liberating force that companies like Zappos, to cite just one example, have used to extend their brand. What Zappos has done wasn't possible in the heyday of mass media.

What has happened is that the pricing structure of Web 2.0 software has been commoditized more than traditional software. Not only are the barriers to entry removed from software, but there's free access to platforms as well and it often doesn't cost anything. Getting it, using it, and deploying it is cheap. YouTube, Twitter, Facebook -- anyone can use these tools and it doesn't cost anything. That means the little guys can play with the big guys on the same field.

bMighty: Even when management is on-board with social networking, you note that there's the possibility of sending the wrong message? How so?

Fraser: The marketing industry has been all over social networking and very aggressively so. That's not too surprising, given the potential for Web 2.0 to destabilize their business. The social media clubs in the U.S. tend to be overwhelmingly populated by PR and marketing people. They're trying to capture the value and they've had some success -- like Zappos -- but there have also been major blunders. For example, the Wal-Mart blog about a guy and his wife traveling the country and camping in Wal-Mart parking lots. The whole thing was orchestrated by Edelman.

Authenticity is the key thing. What companies don't always understand is that communication tends to be highly intermediated; CEOs don't speak causally off the cuff. When they speak with vice presidents, it's often based on what not to say. Likewise, when they speak with analysts they focus on what not to tell. The thinking and value structure of corporations is based on opacity; it's highly rehearsed, stage-managed and there's paranoia about spontaneity. By contrast, the blogosphere values exactly the opposite: spontaneity and transparency. If you try to fake it, you'll get found out immediately. You can't just bring these tactics into an organization and push go. It's important to understand this is a different sphere with different values.

bMighty: How can business gauge the ROI on their social media efforts?

Fraser: Metrics are hard -- there's not a lot of money and not a lot of time. The question is can you get out there and play the game -- like Zappos -- and keep it real and authentic. SMBs less likely to screw up because they don't have the same constraints -- they don't have VPs of corporate affairs -- and if you don't have $10 billion in revenue, you have less to lose; you can just learn the lessons. And it is a fantastic opportunity for small companies to market their brand.

bMighty: What's the next big step in the way that businesses use social media?

Fraser: When is the tipping point for business? The momentum is on the side of Web 2.0, social media included. Software is so commoditized that it's easy for small companies to get the tools they need. The other larger context is that economic crisis has focused companies on ROI. They're looking at how they can transform what they're doing, but most big companies see Web 2.0 stuff as an add on. But the economic crises is perhaps the trigger to reach the tipping point. The crisis has focused people on survival. When your're focused on survival you innovate --when you're starving you begin to innovate.

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