Social networks and viral marketing

As the Internet is growing faster every day, this tool allows consumers to use it as not only an information tool but also for interaction and buying process reasons. Indeed with emergence of online social media, social network is becoming place to be for users and companies too. Facebook has now more than 800 million users and is becoming a new way for marketers to recruit consumers, reinforce loyalty and reputation. New ways for online advertising are now possible and newly marketing techniques are being developed (Montgomery, 2001). The traditional online advertising processes such as pop up and advertising on websites (banners) are not the only ways to attract people connected on the Internet. With social networks, companies can develop direct interaction with their customers and above all they can create online word of mouth with the tools providing by social networks. In this context I find it quite interesting to research on the possibilities offered by this new way to advertise. My research question is therefore: What are the benefits of viral marketing on social networks for companies? This research is important because studies are focusing only on some aspects of the question: online word of mouth, online brand reputation or the way to maximize customers on social networks.

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[...] Firms which are doing viral marketing on social networks are decreasing their advertising costs because they need less stores and salespeople to sell their product (Thorne 2008). A recent study conducted by Brown showed that the Internet is a more attractive market to sell products than traditional media (radio, TV, billboard) for several reasons but the saving costs reason being the strongest among others (Brown 2006) 2.6 ) Benefits: targeting and reaching new customers Social networks allow firms to reach more adequately the right customers which responds to given characteristics. [...]