Day 1 of the Online Social Networking and Business Collaboration World conference was more concerned about trumpeting the successes of the big names like MySpace, Bebo and Friendster. Thankfully, Day 2 definitely tried harder to focus on the benefits for business collaboration, relating the concepts to delegates eager to understand the commercial benefits of social networking. Yet, the underlying theme of the day undoubtedly was ‘why’? Why should businesses, large and small, adopt social networking strategies?

The proceedings opened with an illuminating discussion of audience suggestions on why Australian businesses are hesitating to adopt social networking. Various opinions, fears and limitations were put forward.

• Hardware restrictions and bandwidth limitations
• Fear of a drain on internal resources
• A need for generational change at the management level
• Drops in productivity due to staff ‘playing’ online
• Australian media is cynical and negative in discussing and reporting social media issues
• Tall poppy syndrome
• A fear of online networking is no different to a fear of offline networking
• Is identity fraud an issue?
• Difficult for traditional business managers to understand the ROI of blog posts and social media activities
• Marketers feeling a lack of the traditional control of the two-way conversation of social media compared to the one-way preaching of traditional advertising.

It was clear that there were still many in the room cynical of how social networking could enhance their business. A popular concern was the use of Facebook and other networks by staff during work hours and the impact on productivity. The concept of social media as ‘play’ is still prevalent, displaying a misunderstanding of the business goals and applications of these mediums.

The Semantic Web and Mobile Networking

Ross Ackland from the CSIRO discussed the evolution of the web. “The way the web is evolving is not dissimilar to the neural pathways of the human brain.” Approaching the internet in this way, gathering data and understanding the evolutions of online behaviours, will become key to the development of the semantic web (already christened Web 3.0). The semantic web will allow far more intuitive navigation of the web, becoming a form of artificial intelligence that can present more relevant results and interpretive responses.

The always engaging Laurel Papworth (@silkcharm) explored the mobile networks and the evolution of the mobile phone as a marketing tool. Mobile phones were originally conceived as social media devices; the address book akin to a Facebook friends list, SMS for email, MMS to share pictures, and now a host of other apps on platforms such as the iPhone.

Papworth listed the importance of wi-fi in this developing market. More people being connected ‘on the move’ places competitive pressure on coffee shops and other outlets to provide free wi-fi.

Social Retailing

Paul Marshall of Lasoo presented a comprehensive set of observations on the importance of retailers to avoid surfer fatigue. By this, he means avoiding too many page loads or clicks between discovery and sale. This model means moving marketing off the retail website and into the places where customers are having conversations. With developments such as Google Checkout, Paypal buttons and affiliate marketing, consumers can read about a product or discuss it in networks and immediately purchase it without the requirement for navigation and searching for the retail website.

This is no different to point of sale marketing that has always existed. You see a Chupa Chup at the checkout. You want the Chupa Chup, you buy the Chupa Chup. It is far less likely that you see a Chupa Chup advertisement and directly move to a purchase. More often, the desire created by the advertisement has diminished by the time you next have the opportunity to buy one.

By understanding that your target audience is already talking about the products you sell, it can be a simple step to enter that conversation and provide clear channels to a quick response or sale. Retail is a social activity, but Marshall maintains that many retailers have failed to carry this concept online. The power of word of mouth (WoM) has been known to marketers forever, and this translates to the social web as customer reviews and product ratings. Yet, Marshall lamented the current Australian resistance to customer feedback. “You won’t find an Australian retailer who has reviews on their site today.”

According to Nielsen data supplied by Marshall, 78% of web users considered consumer recommendations the number one form of advertising. Consumers overwhelmingly trust user reviews over reports by critics.

Virtual Worlds

Although fascinating and entertaining, I was less convinced of the relevance of the virtual worlds presentation by Laurel Papworth and Gary Hayes of The Project Factory. Yes, there is no doubt that in terms of time spent per month, virtual worlds such as Second Life and World of Warcraft trump almost every other form of online activity. But I think there is a way to go before marketers and businesses effectively leverage off this space.

WoW seemed a distinctly difficult world to collaborate with business, unless through peripherals such as spoof advertisements or viral campaigns that sit outside the game itself. Although there is a large market of consumers – if they fit your chosen demographic – I find it unlikely that in-game marketing, such as product placement, will ever be relevant for most businesses.

Alternatively, virtual worlds such as Second Life provide complete flexibility for marketers. With brands such as the ABC and BigPond creating islands within SL, they have managed to create interactive spaces for target markets, building relationships.

The attractive proposition of Second Life, and to a lesser extent some of the other virtual worlds, is that it is built on aspiration. Participants create the body they want, the house they want and the lifestyle they want. Because SL is an aspirational, wish-fulfilment environment, it can provide some extremely attractive opportunities for savvy marketers.

Even so, it became very clear that a business needs to have clear goals and strategy before deciding to jump onto the VR bandwagon. Merely entering Second Life purely to have a presence may not provide the ROI required. By having a definite goal, such as attracting the right recruits for an employment campaign, it is far easier to produce specific outcomes.

Banking Can be Social Too

Rabobank provided some extremely valuable insight to counter the fears of some delegates that social networking was only appropriate for certain ‘fun’ brands. After all, the Smirnoff Secret party strategy discussed on day 1 would not be appropriate for a financial institution.

Yet, Edwin van Raalte of Rabobank International was able to illustrate how the right social networking tools can enhance any brand. Through the use of blogs, financial podcasts and forums, Rabobank as able to provide an informative and welcoming conversation that attracted customers. Their philosophy of social engagement is brilliantly portrayed in a TVC produced for the New Zealand market.

“Consumers are using the web to socialise,” Raalte explained. “Businesses need to tap into the ‘wisdom of the crowd.’”

Creative Application

The creative panel threw up some interesting comments. Nick Cummins of Sputnik Agency explained that merely using traditional marketing online wasn’t truly creative. By placing your brands on a billboard within a computer game or within Second Life is not a truly creative approach to the possibilities. Alternatively, true social media creativity comes from mashing together the different tools and concepts to produce something new.

For example; tying GPS technology with mobile phone use and digital photography can produce some highly interesting user-generated content. Finding ways to integrate a brand with these kinds of innovations can produce some extremely creative solutions to social media branding.

Do the Numbers Stack Up?

The day, and the conference, was rounded off by a panel on statistics. Although a dry topic, it became one of the most inspiring and fascinating of the day. Michele Levine of Ropy Morgan research, Stuart Pike of Nielsen Online and Michael Walmsley of Hitwise provided the data and the statistically proven trends that validated much of the discussion over the previous two days. The data shows that social networking does live up to the hype, providing valuable platforms for business while providing a gold mine for data analysis.

Interestingly, and contradicting the ‘yoof’ focus of MySpace, Bebo, et al, Roy Morgan and Nielsen both report an extremely high take up of social networks by professionals, and that 25% of users are over 50. These stats fly in the face of the myth that social networks are only a playground for teenagers with no true business application. More professionals are using networks such as Facebook, LinkedIn and twitter to make connections, find employees, exchange ideas and trends and reach consumers.

The Truth is Out There

Whether delegates felt the cental question of business collaboration on social networks was answered, no one was left in any doubt that online marketing is shifting rapidly and decisively. There will always be those businesses and users that lag behind, while early adopters set the pace. Yet, eventually, it will be impossible to avoid network marketing and the shift from ivory tower marketing to a social, inclusive and interactive model.