Social media is based on engaging and building relationship with the customer. The good thing about this medium is customer's get networked with each other and provide outright and proactive remarks which are of much help for the company, competitor as well. Humans share their likes, dislikes, interests across all geographies at free of cost is the main essence of social media.
Customers are lifeline of any business. Social media companies gather users' information through direct mode or indirect mode. Peer to peer advice, word of mouth are the best strategies that exist in advertising market.
Social media companies like Facebook classifies and gather customer info based on their individual profiles. But owing to privacy reasons some reports claim significant percentage of user profile are distorted about the veracity of their profile, yet Facebook is the largest individual database of the individuals. Increasing popularity makes spend on advertising towards social media as a must strategy. Reaching out and understanding the prospect of customer is a must for every business, which is facilitated by using social media.
Targeted advertising can be done through the use of profiles in social media. Companies run Facebook campaign through the profiles and derive immediate return on investment (ROI). The value of social media lies in bringing down the cost of advertisement and having targeted advertisement.
The information available through social media is relevant and updated. Demographic, geographical area, Buying pattern, brand loyalty, earning income potential presents a higher value to the company about customers. Customer insights in terms of products development, marketing through segmentation are some of the benefits of the profile. So far these reasons social media companies like Facebook, Twitter, LinkedIn, Google are interested to collect the profiles.
In 2012, people got a rare look at how information on public social media profiles - including Twitter, Facebook and LinkedIn - is being harvested and resold by large consumer data companies. Responding to a congressional query, nine data companies provided answers to a detailed set of questions about what kinds of information they collect about individual Americans, and where they get that data.
Their released responses show that some companies record - and then resell - screen names, website addresses, interests, hometown and professional history, and how many friends or followers the user have. Some companies also collect and analyze information about users' "tweets, posts, comments, likes, shares, and recommendations," according to a consumer data company.
Companies that collect social network information said they only take what is publicly available, and that they follow the rules laid down by each social networking site.