Social media began to be prevalent around 2005. Today, social media sites like Facebook and MySpace are prevalent among all age groups, although they began with a focus on young people as their main audience, to keep in touch. Today, though, corporations, too, use these sites to improve customer relations. As of 2009, social media has begun to revolutionize the way corporations are managing customer relations altogether.

Garner, an IT advisory and research company, has said that by 2010, 60% of the Fortune 1000 companies are going to be using social media as one method to make customer relations better. That’s good news, but Gartner also states that over 50% of those companies who are going to use social media to improve customer relations will do it improperly, and in fact may actually harm customer relations rather than improve them. Gartner suggests that instead, companies focus on analyzing customer buying online so that they can get figures on return on investment for customer loyalty and sales, specifically as they happen through social media sites.

Gartner has said that there are four steps that businesses need to pursue so as to use social media successfully as a means to improve and manage customer relations. The first step is to clearly define what the purpose of the social and media initiative is. The second step is that a company must be willing to surrender some control over social media as a means to customer relations, because the public at large wants to “own” part of the relationship as a reward for their participation.

Companies then have to reward those customers that participate socially. This may mean allowing them to vote on, or otherwise rate contributions and information on the site. Finally, companies must appoint someone in-house who has the skills to head up a social media customer relations initiative. Using social media for customer relations should never be an afterthought. In fact, it should probably have someone specifically devoted to it full time, with their own staff if necessary.

Social networking has really changed prospects’ and customers’ behavior, unequivocally. Gartner states that these customers no longer fit demographic profiles such that demographic measurements are entirely adequate or accurate. This is true even though demographics are the usual means companies measure customer relations’ effectiveness by.

When it comes to your company, you’re not going to want to invest a lot of time or effort in such an undertaking without knowing if it will pay off in terms of driving quality traffic to your company’s website.

Non-linear Creations did a year’s study of five social media sites, and their effects. These social media sites were Stumbleupon, MySpace, LinkedIn, Twitter, and Facebook. It was determined after that year that social media sites drove about’% of its site visitors from referring sites in aggregate.

In the Case of Non-linear Creations, Linkedin and Facebook outperformed the other social media sites. That’s important, but it isn’t the whole story. What about conversion rates? Non-linear Creations measured conversion rates by whether visitors downloaded one of their white papers, subscribed to their blog or newsletter, or contacted them by phone or email. In this case – driving real prospects – Linkedin outperformed the other sites. Traffic from Linkedin was much more likely to convert than the average site visitor. Other social media sites actually underperformed the average.

There’s no guarantee that Linkedin will give your company the tangible results that Non-linear Creations got. It probably depends on what type of business you have. It is not quite understood what the less tangible benefits are of reaching customers online in a way that makes them feel as if the brand is listening and cares enough to interact in the way they desire. One of the things people dislike about customer support call centers is their anonymous feel. It keeps them from feeling a sense of relationship to the brand. So far no obvious downsides of using social media for customer service, so it would seem to be in any company’s best interests to use this form of outreach.

It certainly isn’t hard to create accounts on social media sites. The hard part is in actually interacting with customers on them, listening to them, and analyzing your online visitor numbers to see which social media sites give you the most return on investment in terms of online sales or some other metric. At that point you’ll have to determine how much effort to put into making under-performing social media referrers more effective.

To find out more about Social Media, visit David Baxter’s site www.SmartMediaInnovations.com to help strengthen your customer relations today.