Social Media is impacting business models
Earlier in the year I spoke at an event for the Creative Industries Knowledge Transfer Network (KTN), and some recent discussions have caused me to reflect again on how social technologies are fundamentally altering the way we do business. A study by IBM, that interviewed 1500 CEOs, revealed that nearly all of them are adapting their business model, and two thirds are implementing extensive innovations. Of the people interviews, more than 40% were re-defining their business model to be more collaborative.
The KTN event looked at business models and how social media is changing them. At one side of the spectrum, people talk about “Social Business” as the area of businesses becoming focused on serving communities, rather than profit. At the other end, people talk about a “Social Business” as a business that had set up a Facebook page. Perhaps not, but the reality rests between those two extremes. Mellissa Norman, Business Models and Growth Champion for the Creative Industries KTN, asked for my thoughts on how business models are changing. My answer was captured on video.
My take, in short: Social Media is impacting on every single part of the business model. It’s impacting on the way you acquire and interact with customers. It is changing the way you reach existing customers, disrupting existing channels, and turning customers into referrers and channels themselves. It’s impacting on how the inside of the business works, by making communication even more rapid, and disrupting business processes. It’s changing partnership models too, enabling even small businesses to maintain quite large ecosystems. It’s also disrupting how business gather the inputs for their business decisions, and carry out market research.
For any business, now is a good time to stop and look at your business model. Not just where the revenues are coming from, and where your costs are, but what happens in between the two of those things. Who are your partners? How do you get to your customers? How do your internal processes work? Ask yourself how social technology is, or can, change those.
Get ahead of the curve by disrupting your business, before someone else does. Ask yourself difficult questions about your business, and about how you can do things differently. Look at what other people are doing in your space, and adjacent industries, and see what the best practice is.
Social Media is opening up huge opportunities to innovate. It’s time to ask your business what you are going to do about that, and to tool up to take advantage of the new opportunities, while defending the old. For us here at SocialOptic, actively providing some of these technologies means that we are seeing many of these changes first hand. It also means we have to think even harder about how we manage and run our own business. Avoiding the hard questions, is the easiest way to miss the big opportunities.