Is social connectivity friend or foe to corporations?
In 1929, Frigyes Karinthy conjectured that anyone on Earth was connected to anyone else, on average, through just six people. Social networking may be increasing connectedness. Facebook recently studied connectedness among its 721 million active users, concluding that the average distance between any two Facebook users is now only 4.74 "hops" (down from 5.28 in 2008).
That connectedness has benefits for corporations, which can use social networking to provide easy two-way customer communication and facilitate targeted marketing. But increased connectivity has other implications:
News travels faster. Thirty years ago, dissatisfied customers usually told eight to 15 friends about their experience. Today they can (and do!) tell many more. The title of Pete Blackshaw's book says it all: Satisfied Customers Tell Three Friends, Angry Customers Tell 3,000: Running a Business in Today's Consumer-Driven World . Moreover, according to Conversocial, many retailers fail to sufficiently monitor social networks ; it reported that several Fortune 500 retailers missed all consumer complaints on social networking sites during a five-day study in September 2011. Unfortunately, oblivious companies also miss the opportunity to address complaints before they spread widely. Reports of poor customer service can potentially result in numerous customer defections.