Social media a double-edged sword for SMBs

With small and midsize businesses (SMBs) accounting for over 90 percent of the Philippine economy, technology--in particular, social media--is seen as a valuable tool to democratize the playing field and make it easier for local companies to compete with the industrial giants.

Adopting social networks is ideal for local SMBs since the Philippines now boasts the highest usage of online social activities in the Asia-Pacific region, according to online analyst comScore.

Although it is second to Indonesia in the region in terms of Facebook user base, the Philippines has the highest penetration rate of social media users with 90.3 of the country's Web population owning a Facebook account.

But, experts warned that social media could become a double-edged sword if deployed by an overzealous company that does not have a proper strategy in place.

"Social media is not a silver bullet. It won't magically transform your company," said Manila-based Joey Alarilla, head of social content strategy for Yahoo Southeast Asia. "If your product or service isn't good and there are no efforts to improve it, social media will only highlight your inadequacies and annoy your customers."

In an e-mail interview, Alarilla explained that entrepreneurs must stick to their business objectives and remember the purpose of establishing conversations with their online audience.

"Business owners should avoid saying anything they may regret online," he said. "Social media is a powerful tool and with great power comes great responsibility. We've seen many cautionary tales of businesses that have suffered public embarrassment and backlash against their brands when conversations become too heated."

Plunging headlong into the social Web without preparation, according to Filipino social media guru, Sonnie Santos, could also result in the miscommunication of the company's message to its target market.

The tell-tale signs of an ill-conceived social media strategy include having unclear or no rules on online engagement, untrained employees, and the lack of a point-person to support a social Web campaign, Santos said.

However, he warned that SMBs would also be missing out on the market of young professionals if they ignore social media as a communication tool. "[But] if used ignorantly, resources are wasted, productivity is lost, and online reputation can be damaged by employees who use the tool without proper guidance," he added.

Despite the potential pitfalls, embracing the Web as well as a social media policy will likely prove to be the cheapest and most effective way for SMBs to expand their footprint.

Timothy Birdsall, director of Lotus software at IBM Asia-Pacific, which recently launched a social media-enhanced messaging suite in the Philippines, said resource-strapped SMBs will only need to invest in the initial setup to roll out a social media strategy.

Birdsall added: "All they need to do is to create a profile. Put that out, together with their capabilities, and people will find them online. The savings will be infinite."

Santos, however, recommended that SMBs should also hire a consultant to craft their online philosophy and social Web policy, as well set up the site's integration with other social media accounts.

Blending social with existing channels
Alarilla noted that social media should also be "part of a 360-degree marketing campaign" so that it complements the company's online display advertising, search marketing, events and print advertising.

"For SMBs, social media is great at bringing you to where your customers are, and giving your company a human face as you engage them on social networks," he said.

As social media is no panacea, it should only be deployed by SMBs in areas where it can be used as an effective and measurable digital marketing tool.

Santos highlighted relevant departments within an organization that should use the social Web: marketing; customer service and relations; human resources to support recruitment, training, corporate communications and employee engagement; and operations, which is applicable only in certain industries.

He added that the level of engagement would depend on the nature of business and target market. "B2Cs (business-to-consumers) should employ a deeper level of engagement, while B2Bs (business-to-business) should use social Web primarily to manage their online reputation," he said.

Alarilla suggested that rather than formulate their social media strategies from scratch, SMBs could explore social media platforms that have been built specifically for their needs.

For instance, he explained that Yahoo currently has a location-based social networking site in Indonesia called, "Koprol for Business". The service has been designed for SMBs to create self-managed business listings and targets users who are in the vicinity of their business to improve their chances of engaging with customers, he said.

He added that social media can only be effective if every stakeholder within the enterprise embraces it.

"It should transform your company's internal processes and break down silos," he said. "Ideally, every employee should become a social media evangelist for the company, just as your company's goal is to turn your users into your brand advocates."

"Prior to plunging into social media, companies should manage expectations and make stakeholders realize that social media is not a sprint, but a marathon that should be part of a long-term business strategy and overall communication plan," he concluded.

Melvin G. Calimag is a freelance IT writer based in the Philippines.