Think Tank

Social Media: Impact on Society and Implications for Business

Social media (SM) has become an integral part of our lives, and has in many ways redefined fundamental paradigms of speech, expression, identity, privacy, security and even how business is conducted. It has emerged as a platform for societal influence, moving beyond its traditional role as a communication tool. At the same time, there is a growing backlash against social media giants from regulators, activists, the traditional media and other sections of society. At a recent joint session of IMA India’s CEO and CMO Forums, Santosh Desai, Managing Director & CEO of Futurebrands, a brand and consumer consultancy company, spoke of the changing role of social media in society and the potential implications for business.

Revolutionary technologies simplify people’s lives, while technological revolutions alter the way society functions

Social Media or Media Society?

Revolutionary technologies – such as plastics or nanotechnology – bring discontinuous shifts in the working environment. Yet, even as they create huge benefits, such as cost savings or new products or production techniques, their social footprint is limited. They do not dramatically alter people’s lives. Technological revolutions, by contrast, fundamentally change the way a society functions. The introduction of automobiles transformed societal structures and relationships and reshaped cities. Similarly, social media is a technological revolution in that it has converted individuals across the globe into digital broadcasters and consumers. It breaks down hierarchies and promotes inclusivity by being instantly accessible to the masses and by providing multiple functions, includingnetworking and communication. Social media gives virtually everyone the capacity and opportunity to express their opinion on everything from food and lifestyles to politics and even business strategy.

Social media has catalysed a number of fundamental shifts in society

A Catalyst for Change

Historically, it was the wisdom of the few – scientists, writers, artists and other ‘thinkers’ – that shaped the discourse around contemporary issues. Social media has enabled such discourse to be organised around multiple opinions and to thus become more ‘democratic.’ Rather than flowing from ‘top to bottom,’ content and information now flow in all directions and are no longer ‘linear’ in nature. Social media has also given people the freedom to build their own identity and to present themselves as they want the world to see them. On the flip side, this often means that image and representation triumph over reality.

The network effect is all-pervasive, and the creation of knowledge has been decentralised

With social media, more than with anything that came before it, the network effect is all-pervasive. Each new user on Facebook, Instagram or WhatsApp increases the economic value of the network. This benefits both – businesses and consumers. Equally, with the exponential growth of smartphones, there is much greater freedom to instantly post pictures, engage with various forms of content media and in other ways, express one’s sense of individuality. Having billions of virtual voices means that the creation of knowledge has been decentralised. The downside is that it becomes difficult or impossible to verify what is genuine fact as opposed to mere opinion. Even more worryingly, social media can foster shallow opinions, narrow-mindedness and polarisation – which in turn raises demands for the State to act as a regulator/policeman of content.

Businesses must embrace the metaverse…

The Impact on Business: Internal…

The world already operates in the metaverse, with people dividing their lives between two worlds: the online and the offline (i.e., physical). The pandemic has only accelerated this shift, with society and businesses increasingly operating in an online mode. Going forward, the metaverse will be the ‘new normal’ and businesses must find ways to adapt to it.

…while being aware of the challenges it presents and External

…and External

One significant challenge with virtual environments is that they greatly amplify the need for personal sovereignty. People in general, and employees specifically, have begun to seek structures that are inclusive, flexible and flat rather than rigid and hierarchical. However, it is vital for businesses to be able to draw a line between personal sovereignty on the one hand and the requirements of organisational culture on the other. Digital posts tend to leave behind ‘traces’ and businesses may sometimes have to take disciplinary action against employees who ‘cross the line’ by expressing radical views. It is crucial, though, to be able to specify in detail what qualifies as a ‘radical’ view. This helps nudge employees to better align themselves with the company culture.

SM is now central to marketing but it comes with risks

More and more, social media marketing has become central to digital marketing strategies. Yet, even as businesses seek to be as ‘authentic’ as possible on their SM handles, they risk offending at least some audiences. The key is to accept that the organisation’s views will not always align with those of all sections of society. Being able to tide through people’s ‘outrage’ demands a degree of resilience. At the same time, it presents an opportunity to better understand what causes offense – and therefore, what sort of messages to avoid putting out. Mistakes do happen, however, and it is important to take ownership for them, thereby signalling to one’s audience that the lesson has been learnt.

Traditional marketing was intrusive but SM cannot afford to be so

There is another important shift underway. In earlier times, brand communication was seen an intrusive act, one based on overt persuasion. Businesses would use television ads and hoardings to appeal to a mostly-captive audience at a specific time, such as TV viewers or those stuck at a traffic light. Campaigns were typically ‘big’ – ads would be played during a popular TV show and hoardings would be huge – and the aim was to appeal to an audience that had no choice but to view it. In contrast, with social media, it is much harder to force a campaign on to people: viewers always have the choice of unfollowing an account or blocking an ad. Resultantly, businesses must now seek to become part of what customers like to consume. On the other hand, being able to access vast amounts of customer data makes it much easier to identify people’s preferences in the first place.

Distinguish between your content and your campaigns

A key imperative for businesses is to separate content from campaigns. Even when served daily, content that is of a form that consumers want, helps build a trusted relationship between the brand and the business. Done well, this obviates the need for specific campaigns – as the content itself becomes a form of brand communication. A good way to do this is to work with social media influencers to promote one’s products and services. This form of marketing has gained prominence because, unlike celebrities, influencers share the same context, language and even – up to a point – the same stories that the business is seeking to project. Ultimately, consumers want a brand to have a welcoming presence and this much-gentler form of marketing helps achieve this goal.

Patterns of doing business have altered dramatically with the advent of social media. It touches a variety of business practices along with policies around company culture and environment. Therefore, it is vital for businesses to understand social media and its facets to not only align their marketing strategies with the wants of the customers but to also develop the right form of communication to appeal to customers.

THINK TANK