Abstract:

Social media have become widely used by business companies, and large companies as well as smaller ones are using several forms of social media for a variety of purposes. The reason for or intention of the use of social media may vary from company to company. Different social media are used, and the purpose of social media use may differ from one type of media to another, even within the same company. While marketing, sales and customer communication seems to be the most important applications of social media for most businesses, there may be significant advantages from social media usage in many of other company activities.

There are many reports on companies starting to use social media based on a general feeling that it will be good for business, or because other businesses are using them. But many companies have a more structured approach to social media use, incorporating them into their business plan and developing strategies for social media (SoMe) use, and even calculating expected return on investment on their SoMe activities, in line with other investments. Regardless of how structured the approach to the company’s SoMe-use is, there may be great differences in the results of the company’s social media acvtivity.

In this paper we discuss often used reasons for business applications of social media, typically expected effects of SoMe-use, common return on investment factors and some of the typical pitfalls of such activities. The paper examines reported results from several companies, compare the results with the companies’ expectations, and discuss the differences between expected and achieved results. Attempts to identify the most important factors causing such differences are made. In conclusion some characteristics of a best practice for business related use of social media are summed up.

Keywords:

Social media, business impact, knowledge management, IT management and development.