Social networking are brokers ready to face this opportunity?
Since Facebook was launched from a Harvard dorm room in 2004, the social networking site has literally taken over the world, boasting a network of 61 million with active user numbers doubling every six months. In response to its booming popularity. We take a closer look at what business opportunities this online networking phenomenon may open up for brokers willing to think outside the square
In technical terms Facebook is a Web2.0 social networking website. In plain speak this means it is a website which creates an interactive online community that allows people to communicate with their friends, family, co-workers and build networks through common interests and acquaintances.
While originally such sites were viewed in a strictly social light, the focus is shifting in view of their phenomenal popularity. Martin North, managing consulting director of Fujitsu Consulting, explains: "There is a very significant groundswell of use of networking sites and [although] it's very much centred around the younger groups at the moment, it's broadened out quite dramatically over the last 18 months. So there's quite a serious thing going on and it does create opportunity."
Let's talk business
With 250,000 new registrations per day and a growth of 3% a week, Facebook has begun to be embraced as a business tool by companies and individuals around the world, and the site has responded by developing various business applications. So it comes as no surprise that Australian entrepreneurs are tuning in, meaning brokers are in the perfect position to take advantage.
"The critical thing about the networking world, and social networking in particular, is that there is less of a hierarchical interaction - in other words people tend to value opinions of other people. Anyone can have a valid opinion and it breaks down the 'big guys versus the little guys' and creates much more opportunity for anybody to be heard" says North.
Edmunt Pelgen, director of online marketing company Market Reach, says the key strength about Facebook comes back to the name: "People connect with other people by looking at their pictures - they make a personal connection with them."
Reach says it gives brokers an opportunity to personalise themselves and to make them trustworthy: "It's a great opportunity to provide information and resources to people who are looking for those sorts of services and for brokers to position themselves as industry experts."
Target the market
According to Pelgen one of the strengths of Facebook that brokers should capitalise on is its ability to unfailingly reach relevant target audiences.
Pelgen states that while email is often used as a means to reach and sustain contact with past and prospective clients, the trouble is that people are getting spammed and opting out of receiving marketing information. However, since Facebook users elect the people and groups whom they wish to allow into their network, unwanted spam is eradicated simply by not being chosen in the first place.
This feature of Facebook creates opportunity for brokers of all sizes, as they can maintain contact with clients who use their products and services.
They can also be referred on to other users (looking for a broker) as Facebook friends can alert other individuals, groups and businesses via several Facebook features.
Feature fantastic
Pelgen singles out the 'Page' feature as being of most use to brokers. "Basically a Page is like a webpage within Facebook. You put your content up and if people like your stuff they can become a 'fan' - it's a simple one click option akin to subscribing to an email marketing lead, so you only become a fan of a business that you actually want to interact with," he explains.
"A mortgage broker that owns a 'page' can communicate with their 'fans' through the Facebook system by sending them a notification or a message and the beauty is that there's no way that my message will not be received."
However he warns that brokers have to take the right approach and recognise the fact that they have to focus on the social component when setting up a Page on Facebook.
"Someone looking at a Page for a mortgage broker will want to look at that photo, see that person's face, read the copy that's written there, know that the person is trustworthy, see the number of people who subscribe as fans and see the information the person is giving out.
"So if a mortgage broker is willing to give information that helps people by doing that they will build trust and a relationship and people are more likely to come back."
Word-of-net
A second key strength of Facebook, according to Pelgen, is the 'news feed' - that supports features such as the 'Page' and is part of every Facebook page.
"The news feed is critical to Facebook's success as it tells users what their friends are doing". The news feed means you can see who has joined your group, who has posted a message and what everyone in your network is up to.
The news feed also reports any interaction that happens with a Page. With this in mind, Pelgen suggests brokers utilise the mechanism to generate leads, by trying to solicit some sort of interaction from your Facebook network.
"What happens is that any interaction on you Facebook 'page' gets publicised thought the news feed to friends who may think 'well that's interesting' and click through that link," he explains.
Still early days
Although Facebook brings with it incredible potential, experts caution that all Web2.0 sites (including Facebook) come with their own potential dangers and downfalls.
"My view is that when it comes to Web2.0 it's still very early days. The critical thing is that ultimately [brokers] are trying to get though to end consumers, so the question is how best to actually interact with end consumers.
"And end consumers are still tending to use Google or specialist websites," North says.
He also warns that as a side effect of offering an equal, 'non-hierarchical' platform, sites such as Facebook tend to be harder to control. "If you're not careful you can actually become the victim rather than having control of it," he says.
However, on a more positive note, North says: "There's no doubt that over the next two or three years Web2.0 is going to become a more important feature."
Whether that will include an effective Facebook-using broker industry, only time will tell.
