marketing through social networking sites 2003

8/7/2019 Marketing Through Social Networking Sites 2003

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Christ University, Institute of Management

09

Marketing through

Social NetworkingSitesAn Indian perspective

Nitin Sunny, Toshal Shenai


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INDEX

Sr.no Topic Page no

1 Executive Summary 3

2 Introduction to Social Networking sites

History

4

5

3 1) Current scenario and trends

a) Indian internet statisticsb) Identification of various social networking sites in India

c) Indian Internet user Demographics

d) Focus on the major players and Organizations participating in

social media marketing

e) Revenue models for the websites

f) Challenges in the Scenario

6

6

8

9

10

12

13

4 2) Future of Social networking sites

a) Introduction

b) SNS (Social networking sites) Integration model

c) Foray of Internet giants into the social networking space.

d) Future of marketing via SNS in India

14

14

15

18

19

5 Conclusion 20

6 References 21

7 About the Authors 22

Executive Summary


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Social Networking Sites are websites, online communities, portals which help people

communicate with each other on a platform and share or exchange ideas, knowledge,

information, interests, opinions, music, videos, opportunities, product promotions, activities,

resources, hold discussions for developing their social relations.

Social media marketing involves marketing through social networking sites, and enhancing the

web presence of the organization`s brand, products, services. There are many motives behind the

social media marketing of the companies. The major reasons being Brand awareness, brand

building, Acquiring new customers, Introduction of new products and services, Brand

promotions, Customer retention, Market research, Identification and targeting new customer

groups, Identification and improvement of new services, products, offerings. The Social media

marketing has opened new ways to reach the Consumers and potential customers, thus making

this a very important part of the marketing strategy. According to a CMO report, the current

spending on social media by Fortune 100 companies is about 3.5%, which may rise to 13.7% in

the next 5 years. It shows the emergence of this new medium of reaching out the customers and

improving the web presence of the organization.

Social media marketing creates buzz, builds ways for the organizations to reach their consumers

and starts conversations between them. This kind of marketing is considered to be the emerging

way to market products and services and extend the reach among the masses.

History


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The following list is the evolution of social networking. Social interactivity started since the

launch and wide use of phones in 1950`s and is still evolving till twitter.com of 2009.

a. Telephones (1950)

b. UseNet (1970)

c. Bulletin Board Systems (1970)

d. Commercial Online Services: prodigy, CompuServe (1985)

e. World Wide Web (publicly available since 1991)

f. Internet Relay Chat, IRQ, Messengers (1988-92)

g. P2P, Torrents (1999)

h. Social News (1997)

i. Social Networking Websites (1996- onwards)

I. Dating sites

II. Forums

III. Six degrees: the 1st social networking website

j. New generation Social Networking Sites (2000- onwards)

a. Facebook

b. Orkut

c. Twitter

d. Hi5

e. Friendster

f. MySpace


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1) Current scenario and trends

a) Indian internet statistics

The Indian Internet usage has been increasing steadily over the past few years. At present, there

are 60 million Internet users in the country. The Active users or the actual users are 47 million.

The Total Broadband subscriber base has increased from 6.98 million in August-09 to 7.22

million in September-09, thereby showing a growth of 3.29 %.

The regular internet users have grown by only 10% (compared to 19% last year). Very few new

occasional users have got added in the last 1 year and some of the existing occasional users

appear to have lapsed. While the base of the regular internet user has increased by only 3.5

million, the base of occasional users has fallen by almost 6.4 million. Though the overall base ofonline Indians has shrunk, on the positive side, 3 out of 4 internet users (70%) are now on the net

daily. This lively pool of internet user is 32.4 million strong.

Only 1.8% of all Indians (20 million) prefer to read in English. Of these 5 million are already on

the net (as 13% of regular online Indians prefer to read in English). This leaves only about 15

odd million Indians, who prefer to read in English, who can easily latch on to the internet in its

current avatar, provided they can afford it and feel the need for it. Internet usage cuts across the

more well-to-do Indians across the various socio-economic groups, across the urban-rural divideand across the various town classes within the urban landscape. 55% of regular internet users

come from the consuming classes (SEC A, B and R1), 71% of them come from the non-metro

cities and villages, and 82% of them fall in the prime life age group of 19-35 years. On

multiple access basis, place of work (office, school, colleges, etc.) still continues to be the

single largest place for accessing internet at 68%. Usage form home follows next at 50% and


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then by cybercafs at 45%. However, when it comes to the single most preferred place of

access, home (37%) scores over the office (30%) as well as cybercaf (15%) noticeably. 'Home'

still remains the dominant place of access of internet.

With 89% of regular online Indians searching for product information online, window shopping

has become synonymous with internet now. Communication, social interactivity and

entertainment activities stand out as the other most popular online activities. The current online

shoppers base in India is 34.5 million, a good 6.5 million bigger than last years figure of 28

million. However, of all these online shoppers, only 22% (or 7.72 million) actually buy online.

The balance 78% online shoppers only search for products online and then probably buy them

offline. Google is clearly the most popular website among online Indians, with 35% of all online

Indians claiming to use this website the most amongst all the websites they use. Yahoo follows at

second spot with 28% of all internet users using it the most. Gmail, Orkut and Rediff are the 3rd,

4th, and 5th most used websites in India.


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b) Identification of various social networking sites in India

There are a lot of Social Networking Sites that are accessed by the Indian Internet users. Though

the local website have shown an increase in user base, the international websites like Orkut,

Facebook and LinkedIn are still the favorites. Here is a list of all the Websites in India.

Top Indian Social Networking Sites

Orkut.co.in - 14.9 million users

Facebook.com - 8.63 million users

Bharatstudent.com - 2.60 million users

LinkedIn.com - 2.16 million users

Ibibo.com - 1.95 million users

Other Websites:

Hi5.com

Twitter.com

Bigadda.com

Indyarocks.com

Itimes.com


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Fropper.com

MySpace.com

PerfSpot.com

c) Indian Internet user Demographics:

Highlights:

The internet users in India are approximately 60 million.

82% Male and 18% Female

The age groups of 19-24 have 44% users and 25-29 has 34% users. 13% users are aged

36 and above. 9% are under 18 years of age.

The SEC A and SEC B users are 24% and 27% respectively. Rural Users constitute 14%

53% Indian Internet users have reacted to the advertising stimuli

The current online shoppers base in India is 34.5 million. They either shop or search

info, thus enticing marketers to spend more on online advertising.

22% users (7.72 million) have actually done some shopping on the websites

56% (19.32 million) users are window shoppers.

11.23 million Indians have transacted online and bought some product/service.

78% users (26.9 million) search info about products/services online in India.

92% of active shoppers have bought travel-related products.

Only 51% have bought non-travel products/services.


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81% are engaged in some kind of Social interactivity online.

d) Focus on the major players and Organizations participating in social media marketing

Facebook, Orkut, Twitteremerge as the most exciting Social networking Sites in India.Facebook

has recently surpassed Orkut as the favorite destination of the Internet users.

Facebook.com, with 8.63 million users has generated about 1003million page views/month in

September 2009. This is much more than Orkut.com, with 14.9 million users, but just 21 million

page views/month. A website becomes attractive for the marketers with increasing pege views.

This gives them a chance to display their products/services and other company information and

get a probability of generating more enquiries.

Twitter.com does not have an option of advertising on their web page as yet. But the companies

make accounts and can share links of their products or services. This has made twitter a very

exciting and interactive way to redirect the users to their websites. Special teams work on twitter

for many niche companies. By an option to `follow`, the users can follow the trends, news, offers

and tweets by the company. In Social Media Marketing (SMM) these three websites have made a

huge impact in the ad spends of many organizations. IT, Telecom, Travel, Job-Portals are the

main SMMs. Sun-Silk, MTV Roadies, Tata-Tea, Pepsi, Fastrack, Airtel, Vodaphone, Jet-

Airways, Nokia, HP, Bajaj two Wheelers, Kingfisher, Infosys, FlyKingfisher, Capgemini,

Cleartrip, Bookmyshow, AOL, MSN, IBNLive, etc have all done a lot of Advertising through

Social Media. Many of them are active users of Twitter, giving Updates on their products,

services and offers.

Facebook users are 71% male and 29% female. The profile of users with respect to education

qualification and income level is described as follows. 36% are less than graduates, 36%

graduates, 22% post graduates and more than that 6%. Income wise, 8% more than Rs. 15lakh


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p.a, 8% earn Rs.7-15 lakhs p.a, 30% Rs.2-7 lakhs p.a and 54% below Rs.2 lacs. The marketers

are attracted to this wide variety of users and they have the opportunity to focus on their desired

target groups. Facebook places these ads on the profile pages on the left side of the screen and

many users are attracted to them. The advertisements redirect the users to their websites and thus

make an impact on the exposure. On the website, they have published a few case studies and

success stories. It helps the potential marketers to place ads at certain intervals as per their

requirements and targets. The marketers can track their advertising effectiveness on real-time

basis, which is a unique feature offered by Facebook. Komli Media is one of the partners who

handle the clients in India. It is an upcoming Media house with good potential in the Media

industry. They provide brand and advertising measurement services, and have helped many

businesses get better responses.

Twitter.com Every day, millions of people use Twitter to create, discover and share ideas with

others. Now, people are turning to Twitter as an effective way to reach out to businesses, too.

From local stores to big brands, and from brick-and-mortar to internet-based or service sector,

people are finding great value in the connections they make with businesses on Twitter. One of

Twitters key benefits is that it gives you the chance to communicate casually with customers on

their terms, creating friendly relationships along the waytough for corporations to do in most

other mediums. Twitter helps to communicate real time, measure the effectiveness by taking a

look at the followers and also creates awareness among potential customers. It also helps to get

feedback and suggestions to the company in a casual way. This helps the companies to optimize

their offerings and fulfill the needs of the users. In India this trend is getting momentum and is

seen as the potential future of real-time communication between the company and the users.

Currently, Kingfisher, Infosys, Cleartrip, Bookmyshow, AOL, MSN, IBNLive, MTV interact

widely with their consumers and followers. A subscriber base of 1.4 million is growing each day

and with the press also promoting use of twitter, and celebrities like Abhishek Bachchan,

Priyanka Chopra, Shashi Tharoor, Gul Panag, Karan Johar, Preity Zinta, and many moreconnecting with fans through it, Twitter.com is surely moving towards becoming the next big

thing in Social Media Marketing.


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e) Revenue models for the websites

On Facebook, there are options to Create ads online. Facebook Ads is an ad system for

businesses to create a presence on Facebook, spread information virally and to target advertising

to the exact audiences they want. Facebook Ads consist of Facebook Pages and Social Ads. It is

very simple and easy. The section named Design your Ad, helps in creating ads, select targets

with respect to age, gender, relationship status, location, education, workplace, interests, etc. The

Schedule has to be mentioned as Continuous display or with time intervals with start and end

dates. The minimum and maximum spend per day can be mentioned. The mode of billing has

two options: Pay per Clicks (CPC) or Pay per Impression (CPM). The payment has to be done by

Debit/Credit card. The site also offers the convenient option of paying in local currency. The

Review section gives an option to modify the ad and change it if required. Once corrected, the

Ad gets rolled out immediately. Marketplace is Facebook's self-service application for listing

items for sale, housing for rent, jobs available, and so on. Users can use Marketplace to find

things they want to buy or use, as well as list anything they are in the market for purchasing,

renting, etc.

Twitter.com doesnt monetize its services and advertising. The companies and marketers make

their login ID and operate as users. They connect with users and measure the effectiveness by the

number of followers and active users on their IDs. Thus, Twitter is free for advertisers to

advertize and be more effective in the Indian Market.


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f) Challenges in the Scenario

There are many challenges that are faced by the advertisers to market their products in India

through the Social Networking Sites. Language is the most important one. Only 20million

Indians prefer to read in English. And out of that, just 5 million are internet users. Hence the

targeted users are limited. Apart from Facebook.com and Orkut.com, very few websites provide

local language interface to the users.

The number of online shoppers is just 7.72 million in a country with 47million active internet

users. This makes it difficult for the marketers to convert more non-shoppers and window

shoppers into buyers. The majority of the online buyers buy travel related products and services.

For the non-travel related products and services, the web presence has increased but the sales

have not been impressive.

The Indian consumers have not matured with respect to online buying, hence, the scope of

buying online decreases. Though many users have bought products and services online, the net

addition in the buyer list is not increasing at a steady rate.

The number of users with broadband connections is 6.62 million 47%. The other subscribers

have speeds less than 256kbps. Thus this impacts the users in many ways. The slow speeds often

dont allow users to browse the internet for a long time, thus reducing the chances for the

marketers to attract them to check their offerings.

The digital media spending in India in the year ended 2009 stands at just Rs.700Cr out of the

total of Rs.23500Cr. It is very less as compared to Newspaper with Rs.10000Cr, TV 9000Cr and

outdoor Rs.1500Cr


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2) Future of Social networking sites

a) Introduction

Air is ubiquitous. And it is vital for a persons existence. In the future, social networking will be

like air. It would be there where ever you go, would start yearning for it when you dont get

enough of it and is important for survival.

The penetration of social networking in our everyday lives is quite remarkable. It has integrated

into one of our daily activities. A typical high user starts his day by tweeting what he intends

to do for the day and updates his followers as the day progress via his mobile phone. Later in the

night he posts the pictures of the party in Facebook he attended and tags the friends. Thats the

present, but whats the future?

Many people say that social networking sites are reaching a level of saturation. But looking at

the number of new users joining everyday and the penetration of broadband, especially in India,

it seems to be far from true. So again the question whats the future?

The other questions which need an answer are - How much more of social networking will be

there in a mans life and how will it effectively leverage the various marketing initiatives by

companies world over?


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b) SNS (Social networking sites) Integration model


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(This model was developed assuming that business houses would join hands in the future and

create synergy than compete each other and perish.)

The answers to all the questions we raised in the introduction, we believe, lies in a model which

we have developed.

The first step in this model would be a complete integration of different Social networking sites

across the cyber space and various other online applications. In todays context , it would be just

like different social networking sites - Facebook , Twitter , del.ico.us , dig , IMdb , LinkedIn et

all providing integration with in each other.. This would help the users of social networking sites

to access the features of various others by using just one interface. For example lets suppose a

person wants to post a review of a new movie which he saw. When he posts it in Facebook, only

a few in his network will be able to access it. But if there was an option to integrate Facebook

and IMdb and all his movie reviews would appear in the respective section in it, a whole lot of

people would be able to access it, and a person who reads the review from IMdb would be more

interested to do so, than his friends in his Facebook network.

A marketing implication of this would be that one company can actively communicate with its

current and potential users by using just using one of the many social networking sites. Also, by

effective integration, the companies would be able to reach out to the serious users rather than

just any other people. Narrowcasting would get a new meaning all together by this. One

scenario would make this clear. A restaurant which wants to promote its offerings will be able to

do so in just one SNS and this information would be posted in several locations in the cyber

space where people who are really interested to know about this will be able to access it. This

will help the restaurant to reach the right target audience than a group of un-interested

individuals.

The next phase of integration would be a universal log ID. Simply put, its one single log-in ID

for all the different social networking sites. This would help in reducing the clutter which is form

in a users mind remembering the different sites and passwords for every single digital identity he

possess. Different standards would be available and this would simply authenticate your digital

identity. One login id will put away with the long registration forms, confirmation e-mails and et


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al. This would revolutionize the way a Social Networking site work. A similar concept already

exists in the name of OpenID which is still testing waters. A report says that Facebook might

start using OpenID also to establish the digital identity of the user.

This would be the point where the importance of working together as a team than competing

would come to lime light. As there is no sustainable revenue model for a Social Networking site,

there is fierce competition between social networking sites to outdo each other. This in a long

run would be result into a slow, bleeding death of the sites. Instead, if they share the space, pool

in resource and develop a common interface, it would give better outcome. The resultant would

be a win-win situation where there is no actual competition but peaceful co-existence was

everyone is trying to develop a sustainable model.

Such a co existence will, obviously will be followed by the development single interface for

social networking. This interface will enable a user to navigate to any social networking site and

web application with a single log in (or maybe by a verified digital identity) and enjoy the

benefits. This may end up just like a parallel universe where a user has his/her digital identity

and a place where the person interacts to different people based of choice and interests. The

difference of such an interface from a typical virtual world would be that it is a lot more real.

Another change which will happen in the future would be the multiple channels of accessing it.

As the technology advances, there will be better ways of getting connected to the internet and

hence the social networks rather than the more traditional computers , PDAs and smart phones.

This will mark the point where social networks will start expressing itself like air. Ubiquitous

and a mode of survival!


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c) Foray of Internet giants into the social networking space.

Somewhere in the transition process explained in the SNS Integration model , the internet world

would also see mergers and acquisitions of the social networking sites by internet giants like

Google, Yahoo and Microsoft. In the present scenario, there are many venture capitalists to fund

these social networking sites. But, as the time goes, the funding would stop if no viable revenue

model is worked out. Then, where will the money come from? A situation like this would see the

entry of big companies in this space.

This will be advantages for both the parties as the social networking sites dont have any other

sources for sustaining and would give the much needed capital for expansion and research for

better revenue models. This will also give a chance for the giants to get a taste if the social

networking industry without going through the process of initial base development and thus

saves a lot of capital. Also, the bigger companies with deep pockets will be able to fund ongoing

R and D work better than the existing social networks.

The presence of a sustainable revenue model for social networking sites, alas, would decide how

long it would survive. Even if a single universal platform is developed and internet giants make

their foray into the social networking space, only a good plan to generate revenue out of this can

work in the longer run. The primary job of the companies should be to develop this plan rather

than keeping on adding new new applications to increase the customer base.


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d) Future of marketing via SNS in India

India is witnessing a huge growth in the penetration of computer as well as broadband at a fast

pace. Also, availability of smart phones, PDAs and the entry of 3-G will supplement this. This

simply means the country has a huge potential in terms of the growth of social networking sites

and hence the marketing which would happen through it. The more the users , the more the

number of potential and more the companys interest in leveraging their marketing activities

through social networking sites.

India has not seen any revolutionary marketing initiatives till now though social networking

sites. A research we did to map the internet usage among 200 users between 20 30 years

pointed out that most of the advertisements is not in sync with their interests and preferences.

This shows how ineffectively marketing has been done via social networking sites. But the in

future, this will not be the case. New dimensions of narrow casting would be explored and highly

customized and tailor made advertisements would be available.

For example , if there is a conference happening on HR practices in the IT industry , one way

of effectively communicating this would be to find HR professionals in certain identified IT

companies through the universal interface (as mentioned in the SNS Integrity model) and

presenting this to them . This will help in reaching more and more interested people rather than

randomly sending in mails in bulk. Narrowcasting of this degree will help the companies to have


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a better relationship with the customers, find new customers as well advertise new products and

services. A universal interface will also give access to a lot more customers in one shot than

painstakingly track people in different networks.

But what is the level of success of such activities? The technology used might change, but will

the basic consumer behavior differ? The research we conducted shows only 30 percentages of

the people has bought a product or a service at least once as a result of a getting motivated by

seeing an advertisements. So the focus in the future should not be not on the technology part but

how to change the behavior of an Indian netizen and motivate him to engage in a process of

buying the featured product.

Conclusion

The Indian market is emerging. The internet users are growing steadily. In the near future, the

internet users will mature and access more products and services online, thus providing the

marketers to invest more on marketing through the social networking sites. With better

broadband penetration and reduced surfing rates, Indians will surely shift to e-commerce and

online shopping.

Social networking sites are attracting more users and the advertising rates arent high. Thus, we

will witness many more companies increasing their web presence in the near future, and also

increase their budgets for internet marketing and social media marketing.

With the future of Social networking Sites being impressive and a prediction of a single ID for

integrated Website, there are possibilities that the concept of Social interactivity will be simpler,

and more users will have their ID`s online, giving marketers a wider base for their offerings.

The Websites will have better revenue models, the marketers will have more customers, and the

users will get a better access to variety of products, services. With such a situation as a

possibility, all we can see is a win-win situation for all, and a better world to live in. more

friends, more contacts, more connectivity, more products and more advertisers to market their

offerings. The Social media marketing indeed looks attractive and interesting with many new

surprising features to be launched.


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Indians will surely be a part of this growing trend and possibly be the biggest market for the

marketers throughout the world in the coming years. Marketing will be much more attractive and

fruitful through Social Media in the next few years.

References

boyd, d. m., & Ellison, N. B. (2007). Social network sites: Definition, history, and

scholarship. Journal of Computer-Mediated Communication, 13(1), article

11. http://jcmc.indiana.edu/vol13/issue1/boyd.ellison.html

raghav soni, (2008). Facebook Audience Demographics : For US And Indian market.

Report from http://www.watblog.com/2009/07/08/facebook-audience-demographics-for-

us-and-indian-market/

Justin Smith., What Does a World With 1 Billion Facebook Users Look Like? (2009, November). Blog

from

http://www.insidefacebook.com/

IAMAI in association with IMRB (2008): Internet in India, 2008. Report from

http://iamai.in/Upload/Research/ICube%202008%20Summary%20Report%20(Modified)_31.pdf

Sinha, founder/chief editor of pluGGd.in, (2009): 8% of Internet users account for 85%

of clicks. Report from http://www.pluggd.in/internet-users-who-click-on-online-

advertisements-297/

Facebook advertising. http://www.facebook.com/advertising/?src=advf2
http://jcmc.indiana.edu/vol13/issue1/boyd.ellison.htmlhttp://www.insidefacebook.com/2009/11/10/what-does-a-world-with-1-billion-facebook-users-look-like/http://jcmc.indiana.edu/vol13/issue1/boyd.ellison.htmlhttp://www.insidefacebook.com/2009/11/10/what-does-a-world-with-1-billion-facebook-users-look-like/


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Advertising on twitter. Written by Twitter with Sarah Milstein

http://business.twitter.com/twitter101

David Neyhart and Erin Karper. Additional material by Kristen Seas, Tony Russell, and

Kate Bouwens. (2009) Report from: http://owl.english.purdue.edu/owl/resource/560/19/

Comparing websites through vizisense: orkut vs twitter vs facebook at:

http://vizisense.com/compare/facebook.com+orkut.com+twitter.com

Taly Weiss., Handbook of Online India: New TrendsSpotting Report (2009):

http://www.trendsspotting.com/blog/?p=1488

Juxtconsult Internet India Online report 2009

http://www.juxtconsult.com/

About the authors

Nitin Sunny is a second year student, MBA marketing in Christ University Institute of

Management, Bangalore. He did his graduation in Hotel Management from IHM Mumbai.

His professional interest lies in Public Relations, Corporate Communication and Branding. He is

also an avid reader, blogger and social networking enthusiast.

Address Flat no 8, Nawab Gulshan, 4th Cross, Behind Yo-China, Kormangala 6 th Block ,

Bangalore 47

Phone: +91 9986667682

E-mail: [email protected]

Toshal S Shenai is a second year student, MBA Marketing in Christ University, Institute of

Management, Bangalore. He did his graduation in Management Studies from Lala Lajpatrai

College, Bombay, and pursued a Diploma in Human Resource Management from Welingar
http://www.trendsspotting.com/blog/?p=1488http://www.trendsspotting.com/blog/?p=1488


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Institute of Management. His professional interests include Research, in-depth analysis,

Advertising and Brand Building. An active internet user and a sports enthusiast, he is involved in

networking with a wide variety of people for various online activities.

Address - #75, 27th

Main, 3rd

Cross, Opp. Navya Nest, Ashwini Layout, Ejipura, Bangalore -47

Phone: +91 9008930763

Email: [email protected]

marketing through social networking sites 2003

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