The Power of Social Media in Business

Social media, often seen as a tool for personal interactions, has evolved into a powerful instrument for businesses worldwide. The advent of affordable information and communication technology, coupled with widespread internet access, has transformed social media into a daily tool for individuals and organizations alike. This report delves into the ways European businesses leverage digital tools and social media to empower their operations throughout their lifecycle, from inception to customer relationship management. For those looking to jumpstart their social media presence, the Fameswap could be the right decision.

Digital Tools: A Catalyst for Business Growth

There’s ample evidence suggesting that a wide array of digital tools can aid businesses across all industries in Europe. These tools can lower marketing and sales costs, reduce barriers to entrepreneurship, broaden the reach of export markets, and foster innovation within businesses and across industries.

To understand these effects, Copenhagen Economics conducted a survey focusing on the role of social media, using Facebook apps and technologies as a case study. The survey, which included responses from 7,720 businesses across 15 EU countries, indicates that digital technologies like Facebook apps facilitate business growth, trade, and innovation.

The Impact on Business Growth

CE survey echoes the general consensus from the literature that digital tools can be particularly beneficial for small companies by dismantling growth barriers. Small and medium-sized enterprises (SMEs) using Facebook apps and technologies reported the following:

• 47% found the apps helpful in starting a new business.
• 59% reported that the apps are crucial for growing their businesses.
• 58% found the apps useful in reducing their marketing costs.
• 55% considered them instrumental in entering new geographical markets.

Digital tools enable suppliers and customers to interact at a lower cost and higher frequency than other communication means. According to our survey, 54% of companies using Facebook apps and technologies use them to communicate with customers. Furthermore, digital technology like online advertising allows companies to target their core customers specifically, limiting ad displays to those most likely to respond positively. Our survey found that 69% of SMEs considered lower marketing costs as the primary benefit of using digital tools and social media for business purposes.

The Role in Trade

CE findings show that 7 out of 10 businesses using Facebook apps and technologies are exporting to other countries, compared to 5 out of 10 companies not using these tools. The same group of companies using Facebook apps also reported that 19% of their revenue comes from international sales, compared to 14% for non-users. Of those surveyed, 6 in 10 businesses using Facebook apps and technologies found them helpful when entering new markets.

Surveyed businesses across 15 EU markets reported that using Facebook apps and technologies helped them generate international sales corresponding to an estimated EUR 98 billion in exports last year. When splitting export attributions, it was found that Facebook apps and technologies are useful in establishing and growing exports to countries inside and outside the European Union. Surveyed businesses credited EUR 58 billion worth of exports within the EU and EUR 40 billion worth of exports outside the EU to the use of Facebook apps and technologies.

The Influence on Innovation

Digital tools allow suppliers and customers to interact at a lower cost and higher frequency than other communication means. According to the survey, 54% of companies using Facebook apps and technologies use them to communicate with customers, and 63% say Facebook apps and technologies are important in their efforts to improve customer service. The enhanced means of communication also provides a strong loop of information to improve a supplier’s ability to develop, align, and market products that meet consumer needs. To ensure the authenticity of these businesses, the FameAudit can be used to check the legitimacy of followers and engagement on their social media accounts.

Improving the quality of existing products and coming up with new designs are essential for businesses to remain competitive. In our survey, businesses using Facebook apps and technologies reported that the apps’ embedded feedback options were helpful in this regard. 4 in 10 companies state they use this feedback to improve their product offering, while 3 in 10 companies use it to improve how their business is organised.

Wider Economic Benefits

The surveyed companies using Facebook apps and technologies attribute a large share of their business activity to the use of the apps, as reflected in attributed output, jobs, and exports. Surveyed businesses across 15 EU markets say that using Facebook apps and technologies helped them generate sales corresponding to an estimated EUR 208 billion in economic activity last year. When we take a deeper look into that, using standard economic modeling techniques, this translates into an estimated 3.1 million jobs.
Our analysis focuses on economic benefits for producers; the additional benefits realized for consumers are not within the scope of this report.

Conclusion

The power of social media and digital tools in empowering businesses is undeniable. As our survey shows, these tools can significantly aid in business growth, trade, and innovation. By leveraging these tools, businesses can break down barriers to growth, lower marketing costs, and expand their reach into new markets. As we move forward, it’s clear that digital tools will continue to play a crucial role in the European business ecosystem.