9.1 Is social networking a business model?

I have just joined Linkedin and I have sent out requests, My uncle has an account and I can see that his business, developing 5 star B&Bs and hotels, including interior decorating. He is continually dealing with people in Australia & Asia and as many of his clients use his service more than once I can see his business would benefit from using a social network in order to keep his business fresh in his clients’ minds.

An effective business model has a combination of different concepts such as infrastructure, offering, customers and finances. Social networking as a standalone business model design would not be functional, but as part of a business model it would be a valuable tool in the management of customer relationships.
Businesses keep in contact with their customers through phone calls, emails and traditional hardcopy mail, but I can see a great benefit to many business through establishing a social network between themselves and their clients. An example is; Last weekend I caught a business show with David Kosh, (it was obviously sponsored by Westpac, but I’ve put that aside) he was assisting two young guys who had established a ‘boot camp’ exercise business, they wanted a way to keep established clients when they employed a new trainer to take the class they established. It was all about keeping it personal. The business lady suggested contacting their clients with emails to ask how they were going and if they needed any advise to keep the personal contact, which is good, but … a social network would be a lot better. Through a social network all members of the class could be connected in another way and the greater the friendship between participants the more likely they will keep coming to boot camp classes. Also it could provide an opportunity where the trainers could give general tips to all, which could create discussions or they communicate by private email if the issue is more personal. It would also provide an opportunity for members’ contacts to get interested and join the group.

For the down side though, if a couple of people get disgruntled and start winging on the social network it could lead to people moving on, but it does give the business managers the opportunity to quickly address the issues, which will keep the customers satisfied.

http://en.wikipedia.org/wiki/Business_model