Posted by: Gloria Dutton, Marketing Coordinator

Customers are now able to research, shop and communicate online, and because more and more people are taking advantage of these opportunities, they’re able to share their experiences with a wider, Web-based network than ever before. They give opinions and browse others’ reviews in a variety of venues – blogs, social networking sites like MySpace, and within ecommerce sites that allow users to post feedback. And because consumers are basing purchase decisions on the information they find in these social media avenues, companies are making it their business to actively participate.

Social media includes an endless list of online communication outlets including blogs, RSS feeds, forums, message boards, podcasts and social networking sites. In a recent survey by Inc. Magazine, 121 companies varying in size and industry were questioned about their familiarity with and use of social media outlets. The survey found that companies are “very familiar” with social networking (42%), message boards (38%), and blogging (36%).

The most utilized are message boards (33%), social networking (27%), and online video (24%). These companies are aware of the effect social media has on business success as well. Of the companies surveyed, 26% believe that social media is “very important” to their business, while 40% said it was “somewhat important.”

Companies are also willing to spend when it comes to social media. According to a Forrester Research forecast, the amount that enterprises (firms with 1,000 or more employees) will spend on Web 2.0 technologies will surge over the next five years, to reach $4.6 billion globally in 2013. While large businesses are currently spending more on employee collaboration tools than customer-facing Web 2.0 technologies, that trend will reverse. According to Forrester, “In 2013, investment in customer-facing Web 2.0 technology will dwarf spending on internal collaboration software by nearly a billion dollars, according to the forecast.”

So why are businesses banking on Web 2.0 tactics and social media in their marketing efforts? Just as consumers use these resources to give and receive information, companies realize that delving into what their customers are saying offers beneficial research value and opens a two-way dialogue with consumers, a deeper level of engagement.

Whether a company develops a Q&A blog, encourages a social networking group of brand loyal customers, or distributes podcasts describing new products, it is actively participating in molding the evolving image of its brand.