Utility of the Social Web for Business

The Social Web is a phenomenon that has invigorated society. The ways in which people relate and communicate with each other have changed, in turn causing changes to communications and interactions between businesses, their clients and their environments. This forces organizations to understand the phenomena caused by the emergence and pervasion of social media use in order to exploit the advantages that social media can offer and to keep up to date on the tools society is employing to connect and socialize. This creates new challenges for organizations; their structures, objectives and functions must change in order to keep up with the new situation. Adapting allows them to achieve improved brand profitability, development and management. Additionally, companies should be familiar with the risks of using social media as well as how to overcome them. Furthermore, new tools and social media have led to new challenges in measuring business results, which has in turn led to new methods and metrics. Both the volume of information and the qualitative component of data have increased; therefore, traditional methods for measuring revenues and returns on investments have become outdated. This chapter introduces reasons for organizations to use the Social Web. Next, the principle metrics for measuring results will be introduced, with special attention being given to return on investment (ROI). Finally, we analyze the possible risks associated with social commerce for businesses, business changes that tend to occur in structures and management and, lastly, some data about the extent of Social Web use among companies is offered.