Is Social Media an Investment

In its short history, Social Media, as called New Media, has traditionally been seen as a place to satisfy new friends, reconnect with old friends and socialize in an internet social atmosphere. In a nutshell, social networks have been “a cool place to hang out” but held small applicability outside that. There’s not been any lack of funds in Silicon Valley for companies starting new media platforms. With the development of websites like MySpace, Facebook and Twitter, there’s absolutely no question that there’s value in the huge amounts of information about individuals that these platforms have managed to accumulate; however, there’s not been any obvious monetization strategy beyond earning advertising revenue. Arguments have arisen concerning the real value of those companies; some might say that their valuations are artificial and inflated, while another claim that the worthiness of the databases alone are sufficient to justify multi-billion dollar price tags.

The New Value of Social Media and The Social Media Firm

More lately social networking has spawned a new value proposition, that’s the company applicability of this huge user-bases these social networks have generated. Irrespective of which aspect of this evaluation fence you sit on, it may be stated that social media retains immense usefulness for companies trying to find a new means to reach out to clients and take part in two-way communications. It hasn’t been achieved before from a conventional advertising, promotion or public relations standpoint, and has given rise to a different business model: The Social Media Firm. This brings forth the debate of whether or not The Social Media Firm is a fantastic investment. Is The Social Media Firm a trend that will die out in the next several years, or is that a long-term, sustainable business that will one-day drive obsolescence to the usual procedures of promotion, public relations, and promotion?

Given the condition of the present market, Venture Capital and angel financing sources have been maintaining their portfolio bucks near their chest, booking investment simply to companies with an adequate working history, strong earnings streams, and infinite growth potential. Can the Social Media Firm fall into this class? My response is yes. The most important thing is: social networking isn’t going anyplace. Social networking is now a staple of their lifestyles of younger generations, and also the quickest growing adopters of social networking are individuals over age 30. Considering that the popularity of the company possible that social networks retain, big Fortune 500 companies are devoting a fantastic part of their advertising budgets to social networks and social media campaigns. For example, Pepsi has given $20 Million of the advertising budget to get a social networking program named Pepsi refresh, and lots of large companies are starting to follow suit. Obviously, the earning capacity for The New Media Firm is significant.

Is it sustainable?

As stated before, new media isn’t going anyplace. For the most part, it has come to be a normal part of the Internet experience very similar to email. The websites which are considered the gorillas in societal websites may churn; nonetheless, there’ll always be something fresh to that these Internet-based communities may migrate. By way of instance, the social networking migration to-date has gone from MySpace into Facebook into an Instagram bot, along with the upcoming big change along with this gigantic online societal sphere is probably just around the corner. The long-term sustainability of The Social Media Firm is mainly dependent upon these firms’ capacity to spot and pre-empt the upcoming major change, and also to develop effective ways of Implementing both the older and new platforms for the interest of driving revenue, profitability, sales quantity and individuality to their clientele.

Why Outsource to The Social Media Firm?

1 question which could arise would be: why would big businesses employ a social networking service when they have the financial resources to perform it in-house? The solution to this is that the very simple truth that it’s more affordable to outsource a new media campaign to a company which has a proficient team already in place that’s intimately familiar with navigating the intricate universe of social networking. In precisely the exact same fashion that big businesses employ advertising agencies to design conventional media campaigns, this strategy can and will be obtained for social networking. By employing The New Media Firm providers can eliminate both the administrative burden that includes hiring a profusion of new workers, in addition to the learning curve which will unavoidably be present when seeking to incorporate those workers in their company culture. It’s more cost-effective, in both administrative and monetary respects, to outsource those campaigns to specialist teams which are wholly proficient at leveraging the capacity of contemporary networking, navigating the principles of behavior of those online communities and remaining ahead of the curve when it comes to identifying the exploiting of the newest new media tendencies.

Closing Remarks

To sum up, I really do consider that investment from The Social Media Firm holds excellent potential for several fundsnonetheless, it’s very important that if vetting those bureaus, Venture Capitalists and Angels have to make sure that the business includes the appropriate employees and management staff to fully exploit this budding business. The ditch is filled with one-man stores and so-called social networking specialists which are no longer than victims of this recession that have been skillful at Facebook or even Twitter. It’s very important that the architects of fresh media campaigns are knowledgeable about the complex details of social networking, and also the huge variety of resources which exist online to for a company to take complete advantage of their social networking world. Use of these lesser known social networking outlets like Digg, BrightKite, hi5, Xanga and countless others might be the difference between a full scale strong campaign that shows actual outcomes, along with also an ineffective and unorganized endeavor at social networking that wastes marketing bucks.

Because of the infancy of the market, there are only a few businesses out there that really understand how to unlock the value of fresh media for company. The one’s that do will immediately rise to the very top, and when adequate due diligence is completed, these businesses are ripe for investment. A tactical infusion of funds is probably the increase required to choose these businesses out of a sustainable cash-flow company into another industry giant with A-list clientele.