Chapter Extension 14 Processing Social Capital: Facebook, Twitter, and User- Generated Content (UGC)

Q1:How do organizations use information systems to increase the value of their social capital? Q2:How can businesses utilize Facebook? Q3:How can businesses utilize Twitter? Q4:What are business applications for user-generated content (UGC)? Q5:How can organizations manage the risks of social networking and user-generated content (UGC)? Study Questions Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-2

Social structure of individuals or organizations connected by some type of interdependency—friendship, kinship, common interest, financial exchange, dislike, beliefs, knowledge, etc. Social network Any activity an individual or organization takes to create, extend or use a social network Social networking An information system that facilitates interactions on a social network Social networking information system Q1:How Do Organizations Use Information Systems to Increase the Value Of Their Social Capital? Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-3

Traditional business communication is unreliable SN communication is more reliable Viral messaging reaches more people, faster, cheaper, and more personal Fox Lake could expand viral marketing by inducing (viral hook or bait) customers induce their friends to form a relationship with Fox Lake Common ways companies form SN relationships with customers are groups and applications Viral MarketingViral Marketing with SN Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-4

Word-of-Mouth Marketing CE14-5 Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Traditional business relationship you (the client) have some experience with a business, You may express your opinions about that experience by word- of-mouth to your social network

Social Network Marketing at Fox Lake Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-6 “I just had the Sunday night lobster dinner at Fox Lake, Yummm!”

Viral Social Network Marketing Opportunity CE14-7 Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Viral hook: Something that induces people to share your with others

Viral Message Causes Your Friends (and Theirs) to Connect with Fox Lake Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-8 Viral marketing more powerful if your message induces your friends (and their friends, etc.) to form a direct relationship with Fox Lake’s SN presence

Windows Live SkyDriveLive SkyDrive Store documents in “cloud” to share with colleagues or friends If friends want to add, modify, or delete documents, they get Office Live ID by creating a MSN Hotmail account, thus forming a direct relationship with MicrosoftOffice Live IDMSN Hotmail account Example of a Viral Hook Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-9

Asking people to do a favor for you Frequent interactions Increasing the Strength of Relationships Buying your products, writing positive reviews, posting pictures using your products or services, etc. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-10 Strength of a relationship: Likelihood that entity (person or other organization) will do something that benefits organization

SocialCapitalSocialCapital = NumberRelationships x RelationshipStrength x EntityResources Most organizations today ignore value of entity assets and simply try to connect to more people with stronger relationships This area is ripe for innovation Connecting to Those with More Assets Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-11

Three types of groups: Public: Anyone can find group by searching and join Invitation: Anyone can find group by searching, but must be invited to join Private: Group cannot be found by searching and members must be invited to join Q2:How Can Businesses Utilize Facebook? Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-12 Private Public Invitation

Fox Lake could create an invitation group for each wedding to use as its wedding website Bride invites everyone on guest list to join group Prior to wedding, members place photos and videos of their relationship and engagement on group site Links to gift registers; directions to Fox Lake; weather forecasts; any other information of interest to wedding attendees Start a discussion list about bride and groom Fox Lake Possible Use of Facebook Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-13

Strengthening Ties with Networking Groups Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-14

Social networking application Social networking application —a computer program that interacts with and processes information in a social network Survey HurricaneSurvey Hurricane — users who install application on their page can survey their friends on topics of interest New York Times News QuizNew York Times News Quiz is another application Fox Lake could create an application called “Plan Your Fox Lake Wedding” and make it part of its product offering Using Facebook Applications Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-15

Example Social Networking (SN) Application Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-16 Meaningful applications use information in social graph. A social graph is a network of relationships.

Share a personal perspective on the world Compel users to to come back again, and again Address real needs, from entertainment to practical tasks Use information in social graph Social Useful ExpressiveEngaging Key to Success: Make Application Compelling Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-17

Why develop an SN application rather than a website? Answer lies with degree application requires a social graph Does application use or benefit from social network communication? Is there a need for social collaboration? For feedback and iteration? If not, could develop a web application SN Application vs. Websites Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-18

Microblog—a website on which users can publish their opinions, restricted to small amounts of text, like Twitter’s 140 characters Microblogging enables two-way publishing, worldwide Enables users with similar interests to find each other Q3:How Can Businesses Utilize Twitter? Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-19

Direct contact, immediate, low cost contact with customers in mass with a link to a website Public relations People look for Tweeters who offer something they value: advice, links to resources, and interesting and thought- provoking opinions Relationship sales Product managers search Twitter traffic to learn the “buzz” about a product Market research How Can Businesses Benefit from Microblogging? Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-20

Common types of UGC Q4:What Are Business Applications For User-Generated Content (UGC)? Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-21

Common UGC Applications Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-22

Inappropriate content Mutinous movements Q5:How Can Organizations Manage the Risks of Social Networking and User- Generated Content? Unfavorable reviews Junk and crackpots Dependency on SN vendor Risks Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-23

Q1:How do organizations use information systems to increase the value of their social capital? Q2:How can businesses utilize Facebook? Q3:How can businesses utilize Twitter? Q4:What are business applications for user-generated content (UGC)? Q5:How can organizations manage the risks of social networking and user-generated content (UGC)? Active Review Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall CE14-24

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