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- W2285381485 abstract "Web 2.0 services and social media (SM) have created online communities,which resemble those in the real world in terms of complexity and involvement(Cetron and Davies, 2010). Unsurprisingly, a number of indicators point torapid and extraordinary shifts in organizations’ business models and strategiesto account for the rapid diffusion of Web 2.0 and social media. Companies suchas IBM, Intel, Kodak and Best Buy have developed policies, protocol, guidelines,templates and procedure for SM use (Advertising Age, February 22, 2010). Oneestimate suggested that by the early 2008, about a third of the top 300 retailwebsites offered consumer-generated reviews (Sullivan, 2008). ForresterResearch reported that by the early 2010, about 70 % of retailers were on Facebookor MySpace and over half of them were on Twitter (Martinez, 2010).To understand the popularity of SM, it is important to consider one detail.In 2009, VC investments in Internet companies declined by 39 %. One notableexception was Twitter, which raised US$100 million in 2009. Twitter was the onlycompany on the Internet, represented in the 10 biggest venture deals of 2009.Organizations are facing unprecedented pressures from customers to adoptSM. Nordstrom spokeswoman Brooke White noted: For some of our customers,this is how they want to be communicated with. They really don't want a phone call.They'd rather just get a tweet (Martinez, 2010). Unsurprisingly, web 2.0-basedinnovative tools have been developed in diverse activities such as health careand education (Tapscott, 2010). Marketers are developing metrics to measureactivities such as blog impressions and social network interactions (Maddox,2008). Preliminary studies indicate a high rate of returns associated withinvolvement in SM. A study conducted by Vitrue (http://vitrue.com/) indicatedthat in the average the value of a 'Fan' on Social Media is $3.60 (Morrissey,2010a). And yet, recruiting a fan base has proven to be a challenging task formost organizations. The experience of Dessert Gallery’s (DG), a Houston-basedbakery and cafe chain, is an eye-opener for most organizations. The company launched the Facebook page and invited people on the mailing list to become afan. DG found that only 2.1% of the customers on its mailing list became fanswithin three months (Dholakia and Durham, 2010). Our goal in this paper is modest and is simply aimed at understanding ofultimate objectives and goals that companies can accomplish by using socialmedia and specific actions that are instrumental for achieving those goals. Wepropose a framework for understanding the key dimensions of social media and Web 2.0 with regard to organizational impacts and performance indicatorsto aid in organizational decision-making. The framework presented here is thefirst step towards a more systematic understanding of how companies can buildbusiness models around social media." @default.
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- W2285381485 date "2012-05-24" @default.
- W2285381485 modified "2023-09-24" @default.
- W2285381485 title "The organizational economics of social media" @default.
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