Introduction

“I am a firm believer in the people.”
—Abraham Lincoln

This book is all about you. Neither the first edition nor this one would have been possible without your questions, contributions, and passion for the subject matter. I thank the many tens of thousands of you from around the world who read the first edition and engage in dialogue on social media business topics every day with me and with one another.

Similar to the Internet pioneers 15 years ago, you are the ones defining, shaping, and leading the Facebook Era. At a time when the business outlook still feels uncertain, you have stepped up to the plate with bold optimism, inspiring ideas, and a willingness to experiment, learn from mistakes, and share. Although in most cases we have never met, your stories, ideas, and comments have inspired this second edition and my new software company, Hearsay Labs.

After the first edition, many of you wrote to me saying, “Thanks for telling us about the incredible possibilities on Facebook for my business. Now please tell us what tools are out there to help us!” As it turns out, I couldn’t recommend very many. So I left Salesforce.com, called an old friend and programming partner from college (Steve Garrity), and together we founded Hearsay Labs to help companies grow and manage customer relationships across Facebook, Twitter, LinkedIn, and other social sites.

Special thanks to the most active contributors on our Facebook Page: Jamie Parks, Joseph Ray Diosana, Olena Koval, Danni Aiken, Shannon Ng, Nadine Gerber, Samir Pandit, Todd Chaffee, Ernesto Bruscia, and Rich Liao. As the rest of you begin thinking about how to apply concepts from the book to your business, I encourage you to check out their ideas and contribute your own at:

• http://facebook.com/thefacebookera (I have set up discussion threads on each of the chapters. Please weigh in!)

• http://twitter.com/clarashih

What’s New

Less than a year has passed, but the world has changed dramatically since The Facebook Era was first published. A goal of 200 million Facebook users sounded like a lot then, but more than 500 million people are on Facebook today. Back then, we had some ideas for what might work for businesses on social networking sites, but many of the case studies were admittedly half-baked. Everything was nascent.

This edition tells the rest of the story. By many measures, Facebook has “won.” Twitter has become relevant (at least buzz worthy). LinkedIn has strong momentum. However, many of the other social networks in the last edition have all but disappeared or been forced to focus on narrow and specific niches, such as music in the case of MySpace or virtual worlds in the case of Hi5.

Today the social Web is filled with many more examples of innovative ways in which companies are successfully getting to know and support their customers, reach new audiences, and sell more stuff. We are finally beginning to understand and, in some cases, quantify the value of online social networks—whether for sales, marketing, customer service, innovation, collaboration, recruiting, or some other business function.

Few companies have completely mastered the social Web, but many are doing one or a few aspects really well. This book uncovers best practices, trade-offs, and pitfalls from leading companies across multiple segments and industries, and suggests how your business can take advantage of the social Web.

Social media is suddenly no longer a mystery. It is partly science that we can study, learn, and measure. This book teaches you how to do so. I’ve added new chapters based on your requests via Twitter and Facebook. I’ve largely rewritten the rest to reflect the many changes and innovations that have taken place during the past year:

• Each chapter now ends with a summary of takeaways and an actionable to-do list.

• We set up discussion threads for each chapter at http://tinyurl.com/facebookerachat for you to delve into specific concepts, share your own experiences, and learn from peers.

• The book contains more than two dozen case studies and examples to bring important concepts to life.

• Instead of talking about Facebook only, this edition also provides extensive coverage of both Twitter and LinkedIn.

• We have incorporated expert opinion sidebars from renowned social media authorities across the business, academic, and analyst communities, including Frank Eliason (director of customer service at Comcast, better known as @ComcastCares on Twitter), Mikolaj Piskorski (professor at Harvard Business School), and Charlene Li (bestselling author of Groundswell and Open Leadership, formerly at Forrester Research).

• We have added five new chapters, including ones on customer service (Chapter 5); innovation and collaboration (Chapter 7); ways to develop your Facebook Era plan and metrics (Chapter 9); advice for small business (Chapter 13); and advice for nonprofits, healthcare, education, and political campaigns (Chapter 14).

How It Started

It was spring 2007. Smoking indoors hadn’t yet been outlawed, although this place might not have cared either way. These two older men, clearly regulars, sat in the back corner, with bare, lanky arms hanging out of their wifebeaters, a cigarette dangling out one side of their mouth and a toothpick out the other. They were gesturing animatedly, laughing, eating, smoking, and chattering away in loud Cantonese about this and that.

I tuned them out to focus on my steaming bowl of wonton soup. Just then, out of the corner of my ear, I heard them just barely: “Blah blah blah Facebook. ” I instantly sat up to listen. I had not been mistaken—these two men, slurping their congee at an anonymous diner tucked away in a corner of Hong Kong where foreigners never go, were talking about Facebook. Their children who were in college abroad had gotten them into it, and now they were hooked. I was floored. It was the moment I realized that if Facebook were not already mainstream, it would become so very soon.

I flew back to San Francisco the following week and attended the first Facebook “f8” developer conference, where they unveiled a new Web platform that would enable third-party software vendors to build applications for Facebook users. The product demonstrations were mind-blowing—new Facebook applications such as iLike for sharing music with friends, Slide for sharing photos, and so on.

Still, I felt like something was missing. Photos and SuperPoking are fun, but where were the business applications? At the time, I was working at Salesforce.com, which made its name developing customer relationship management (CRM) applications. But wasn’t relationship management at the core of what Facebook was offering, albeit in a more fun, casual, and modern way?

That night, I went home and sketched an idea for bringing Facebook to business. As a product marketer, I had been spending a lot of time on sales calls and saw that the most successful reps established immediate rapport with their prospects and had the strongest personal relationships with customers. In my personal life, I saw Facebook help establish faster and better rapport with people I had just met, and help me maintain closer relationships with my friends.

Facebook, I realized, is CRM. So I decided to try something bold: Combine Facebook with Salesforce.com. With my friend Todd Perry’s help, I developed Faceconnector, which pulls Facebook profile and friend information into Salesforce account, lead, and contact records. Instead of anonymous cold calling, sales reps and other business professionals could get to know the person behind the name and title, and even ask for warm introductions from mutual friends.

Fortunately, Todd and I weren’t alone. Enterprise companies such as SAP, Oracle, and Microsoft evolved their products to include Twitter, Facebook, and other traditionally “consumer” social media. New companies emerged, such as Telligent, Lithium, and Jive, to build enterprise social technology from the ground up. The social CRM movement had begun.

Why You’re Reading This Book

Social media is a disruptive force for business. Every customer and employee suddenly has a voice, and what they say matters. Companies have no choice but to become transparent, responsive, and collaborative, or else risk going out of business. Everything is changing around customer expectations, customer participation, and how companies are organized. Brands are being elevated or jeopardized overnight by a single customer’s opinion that “goes viral.” Next-generation products are no longer being conceived in the lab or executive boardroom; they’re generated by customers themselves. Unquestionably, we are living and working in the Facebook Era.

As we saw with the Internet Era and the PC Era before it, mastering the Facebook Era has become the new competitive advantage for businesses. Just as when we had to learn how to Google and email 15 years ago, today we have to learn Facebook and other social technologies to be effective in our personal and professional lives. This book is meant to help you understand and successfully implement online social networking tactics and strategies for your company and career.

Perhaps these situations sound familiar:

• You know that your business needs to get on Twitter and Facebook, but you don’t know where to begin or how to advance to the next stage.

• You use Facebook, LinkedIn, and Twitter in your personal life, but you aren’t quite sure how it fits with your professional life.

• You want to hear how real companies are succeeding at sourcing and converting leads, engaging audiences, and transforming customers into evangelists on social networking sites.

• You understand that whether it’s looking for a job, closing a deal, or advancing your career, a lot of it comes down to who you know in your social networks.

• Increasingly, you’re being asked to do more with less, and you want to leverage the power of your networks, your colleagues’ networks, and your customers’ networks to get the job done better, faster, and cheaper.

500 Million and Counting

With more than 500 million people spending an astonishing 20 billion minutes per day logged in, social networking sites such as Facebook, Twitter, and LinkedIn are creating new norms around how we behave, share, and form relationships. And it’s having a profound impact on just about every aspect of our lives.

As a businessperson, you need to be where your customers are, and customers are spending more time on social networking sites such as Facebook and Twitter. How will people use Twitter or Facebook to learn about or become engaged with your company and products?

What started (at least in Facebook’s case) as a dorm room fad has blossomed into a cultural movement. More than a decade ago, the World Wide Web of information emerged, connecting us with news, content, and information. Today a World Wide Web of people is emerging, creating an online social graph of who is connected to whom and how. As with the Internet era before it, no aspect of society is untouched by these new technologies. From Iran’s election to basketball player Shaquille O’Neil’s million-plus following on Twitter, the rules are being rewritten across business, politics, and philanthropy alike.

With the lightning pace of technology, we are living in a very different world than just a few years ago. Today’s college students don’t use email except with “grownups” such as professors and potential employers—they send text messages, Facebook poke, and write on each other’s Facebook Walls.

But it’s not just college students. The largest and fastest-growing segment of Facebook and Twitter users are those aged 35–49. We are relying more on social networking sites as a primary means to communicate with friends and get the news. Newspapers, email, and traditional Web sites aren’t going away (well, some would argue that they are), but certainly a new player is in town.

It’s All About the People

Perhaps the social Web was inevitable. Technology shouldn’t be—and was never meant to be—an end in and of itself. It is meaningful and valuable only where and when it serves people. Esoteric technology was the result of an immaturity of our systems and thinking. The social Web provides us with a new way to bring our identities and relationships to the forefront of technology and to make technology people-centric. This book started out about business and technology, but it’s also about a paradigm shift in our sociology, culture, and humanity.

The future is anyone’s guess, but we do know that business will never again be the same— whatever your industry; wherever you work; whether you are in sales, marketing, product development, recruiting, or another corporate function.

We were in a similar place of anticipation during the early days of the Internet. Then, as now, some companies jumped blindly onto the bandwagon, investing a tremendous amount of time, energy, and capital to implement technologies they did not understand, with no clear strategy and, ultimately, with little to show for it. Others dismissed the Internet as a fad and were gradually outcompeted by online businesses or companies that used the Web to achieve more efficient and effective sales, marketing, recruiting, product development, and operations. But the smart ones took notice and began preparing for what an Internet era might look like. They thought through the implications for their business, and they adapted and thrived. This book can help you be smart about online social networking so that this time around you, too, can adapt and thrive.

If it’s true that we are separated at most by only six degrees, then you are not very far from any one of your customers or prospective customers. Read this book, and then go out and get them.

Welcome to the Facebook Era!

How to Use This Book

This book is structured into four parts:

Part I, “Why Social Networking Matters for Business” (Chapters 1–3), provides the bigger-picture framework and social implications from which we can develop a richer understanding and appreciation of social networking for business—what’s happening, how it’s changing our society and culture, and what we can learn and apply from past disruptive technologies.

Part II, “Social Networking Across Your Organization” (Chapters 4–8), takes a tour of five major functions in a company—sales, customer service, marketing, innovation, and recruiting—and explores how social networking technologies are affecting them.

Part III, “Step-by-Step Guide to Social Networking for Business” (Chapters 9–12), is a practical how-to guide on Facebook profiles, Facebook Pages, Twitter accounts, and social network ads.

Finally, Part IV, “Social Networking Strategy” (Chapter 13–16), is all about strategy and implementation. We discuss specific ways for companies of all sizes, including nonprofits and political campaigns, to best use the social Web to accomplish organizational objectives.

Part I:Why Social Networking Matters for Business

• Chapter 1, “The Fourth Revolution,” talks about the social networking phenomenon in the context of the three digital revolutions before it: mainframe computing, the PC, and the Internet. It draws examples from Bloomingdale’s department store and Starbucks to illustrate how past technology revolutions changed industry landscapes, and what business decisions helped these companies establish a competitive advantage. The chapter concludes with a brief history of social networking sites and a comparison of Facebook, Twitter, and LinkedIn.

• Chapter 2, “The New Social Norms,” explores the changing expectations, behaviors, and etiquette that are emerging around sharing information on social network profiles. The chapter discusses personal branding, generational differences, and the concept of “transitive trust” and its role in purchase decisions.

• Chapter 3, “How Relationships and Social Capital Are Changing,” discusses the concept of social capital, how social capital is used to achieve business goals, and how online social networks enhance our ability to accumulate and exercise social capital to achieve our personal and professional goals. This chapter explores how online interactions facilitate entrepreneurial networks, the crossover between offline and online networking, organizational flattening, and value creation from network effects.

Part II: Social Networking Across Your Organization

• Chapter 4, “Sales in the Facebook Era,” speaks to the power of the online social graph for a sales cycle, from prospecting and the first call to receiving customer references, navigating customer organizations, and enabling sales teams to more easily collaborate. It features a case study on how Silicon Valley start-up Aster Data Systems has used employees’ collective MySpace, Facebook, and LinkedIn networks to source leads and build personal relationships with customers.

• Chapter 5, “Customer Service in the Facebook Era,” discusses new opportunities around crowdsourcing question and issue resolution with the customer community, ways to address negative feedback, and methods for harnessing customer support forum pages for search engine optimization. It features customer service experts Natalie Petouhoff of Forrester Research and Frank Eliason of Comcast.

• Chapter 6, “Marketing in the Facebook Era,” talks about the breakthrough marketing techniques that online social networks make possible, including hypertargeting, enhanced ability to capture passive interest and conduct rapid testing and iteration on campaigns, social community engagement, and “automated” word-of-mouth marketing. It features multiple case studies, including national fast food restaurant Pizza Hut and start-up retailer Bonobos, demonstrating that large and small businesses are achieving marketing success with Facebook’s new social advertising and engagement tools.

• Chapter 7, “Innovation and Collaboration in the Facebook Era,” describes how the four stages of innovation—concept generation, prototyping, commercial implementation, and continual iteration—become more effective and efficient with social networking sites. This chapter features examples of how companies such as Experian are tapping into the wisdom of their customer communities on social networking sites to source new ideas and keep getting better. It features innovation experts Deb Schultz of Altimeter Group and Gentry Underwood from IDEO. Ezra Callahan and Leah Pearlman from Facebook also weigh in on how Facebook itself uses Facebook to innovate.

• Chapter 8, “Recruiting in the Facebook Era,” applies these concepts to the ever-important task of identifying, hiring, and retaining employees. It features a short case study on how Joe, a Chicago-based headhunter, uses Facebook and LinkedIn to source new candidates, keep in touch with candidates who might not be ready to leave their current roles, and maintain personal relationships with successful placements. The chapter concludes with a short set of suggestions for job seekers on how best to use online social networking to find and land the right role at the right company.

Part III: Step-by-Step Guide to Social Networking for Business

• Chapter 9, “How To: Develop Your Facebook Era Plan and Metrics,” walks through the tactical steps in defining and implementing a multistage social media strategy, including allocating resources and budgeting, organizing the team, and measuring. This chapter also introduces social customer lifetime value, a conceptual metric that I developed to give companies a starting point for calculating the return on their social initiatives.

• Chapter 10, “How To: Build and Manage Relationships on the Social Web,” details how individuals can set up a social networking account and provides tips for creating effective profiles, establishing friend connections, organizing contacts, and managing different identities across your personal and professional contacts.

• Chapter 11, “How To: Engage Customers with Facebook Pages and Twitter,” guides companies through the process of creating, managing, and facilitating successful customer communities on social networking sites. Featured examples include Ferrero, H&M, Coca-Cola, Sears, Newbury Comics, and Nestlé.

• Chapter 12, “How To: Advertise and Promote on the Social Web,” is a step-by-step set of instructions on how to tactically execute and optimize hypertargeted ad campaigns on Facebook and LinkedIn using many of the social marketing techniques described in Chapter 6. This chapter includes tips on how to optimize your Facebook ad campaigns directly from Tim Kendall, who heads the ads team at Facebook.

Part IV: Social Networking Strategy

• Chapter 13, “Advice for Small Business,” is geared toward small business owners and employees, sole proprietorships, and others who might not have someone assigned to look after a social media strategy (or, in many cases, any form of marketing support), and how these types of businesses should be using Facebook and Twitter.

• Chapter 14, “Advice for Nonprofits, Healthcare, Education, and Political Campaigns,” has specific case studies and advice for charitable organizations, political candidates, and other groups whose constituents might include volunteers, donors, voters, aid recipients, and others who don’t fit the traditional model of a for-profit customer.

• Chapter 15, “Corporate Governance, Strategy, and Implementation,” speaks to the challenges, obstacles, and realities of implementing social networking technologies in a corporate setting. This chapter urges businesses to consider the risks around privacy, security, intellectual property, confidentiality, and brand misrepresentation, and the importance of partnering closely with legal and IT departments to put the right systems and policies in place to mitigate these risks.

• Chapter 16, “The Future of Social Business,” explores the general trends emerging from the social Web: flatter organizations, greater collaboration across organizations, and a continued movement toward applications and experiences that are personalized, social, mobile, and real-time. Despite many unknowns and certainly more change, companies need to start thinking now about how social technologies will affect their business and take the necessary steps to adapt and thrive in the Facebook Era.