Should Entrepreneurs Jump on the Social Networking Bandwagon?

Between my role here at About.com as Entrepreneurs Guide and my core business as a social media & social networking consultant, one of the most common topics I get asked about is how small business owners can best take advantage of these new tools. This week, the question came from the Wall Street Journal, doing a piece on Building an Online Community Of Loyal and Vocal Users.

I encourage you to read the entire article, but I wanted to expand on some of what I said there. In particular, I want to look at three core social networking strategies and when they do and don't make sense for small business owners.

#1 - Blogging

I'm pretty much convinced that there's not a business in existence that couldn't benefit in some way from blogging. As a fun aside, if you doubt my claim, check out the Business Blog Challenge, in which blogger Liz Fuller challenges readers to name a business that wouldn't benefit from blogging and she shows how it cold. Challenges so far include roadkill removal, independent embalmer and funeral home and a quarry.

Blogging gives you a direct connection with your customers that, unlike newsletters, is bidirectional, i.e., your customers can talk back to you. Doing all of this in a public venue (assuming you do it right) has tremendous benefits in terms of brand-building, customer service and increased visibility, particularly as a result of search engine optimization.

To learn more, see:

• Why Should You Start a Blog for Your Business?
• 6 Tips to Turn Your Business Blog into a Sales Tool
• Should I Blog on My Own Website or a Blog Hosting Service?
• Case Study: Using a Weblog to Achieve #1 Rankings in Google
• Things to Avoid in Business Blogging

#2 - Engaging in Social Networking and Social Media

Again, I don't think there's any business that couldn't benefit from this in some way. The question isn't whether to participate or not, but where and how to participate effectively. If you're involved in anything having to do with pop culture, you probably need to be on MySpace and Facebook. If you're doing B2B services, though, those may not be an effective use of your time, while LinkedIn, on the other hand, is practically a business essential. If you do business internationally, you should be engaging in Xing, as well as whatever the most popular sites are in the countries in which you do business.

The key here is to find out where your customers are already engaged and go join the conversation. You may be able to start your own site or group within an existing site (see #3 below), but it's far more important to identify and participate where the conversations are already happening. Are there people already talking about your company? What are they saying? If not, are the talking more generally about the kinds of products and services you provide? Or about the problems your business solves? These are the questions you need to answer.

To learn more, see:

• Ten Steps to Dramatically Improve Your Network with Social Software
• How to Use Online Networks to Market Your Business
• Leveraging Social Networking Sites to Generate Business
• Virtual Business Development

#3 - Creating Your Own Social Network

This is where it gets a little trickier. A growing number of companies are making it very easy and affordable to create your own social network (see 9 Ways to Build Your Own Social Network and 34 More Ways to Build Your Own Social Network). Some of the most popular, such as Ning and KickApps, allow you to start for free, using an ad-supported model, then phase out the ads and de-emphasize the co-branding over time as you grow. This is an extremely attractive model for small businesses that want to experiment with it without a large cost commitment.

But beware. Even if it's free, creating a social networking site that never really gets off the ground is probably worse for you in the long run than never creating it at all. The biggest question you have to ask is this: "Is there a compelling reason for my customers to connect with each other and converse on an ongoing basis?"

For some businesses, there is, for others, there isn't. Simply using the same product or service isn't sufficient reason -- there's really nothing to keep people engaged and coming back for more for some services. For example, customers of the corner convenience store or gas station might be interested in reading your blog, but have no compelling reason to connect with each other. But the customers of a local hobby shop or art supply might. They share a common interest that goes beyond a simple commodity product. They can share ideas, tips, find project collaborators and even arrange live in-person events, with your site as the focal point. That makes great sense for a small business, if there's a sensible fit.

But if there's not such a fit, don't try to force it. Stick to the first two strategies above and make the most of them.

To learn more, see:

• The 4 Types of Customer Community
• Top 5 Tips for Hosting a Customer Community
• 10-Step Checklist for Starting Your Community