Social media is now a major force in today’s society with people of all ages, backgrounds and social groups. Fuchs (2014) explains that now more than ever we need to understand social media and the impact it is having on our lives and how it is such a useful marketing tool if used effectively. Fuchs 2014 book explains that people need crucial knowledge to help us navigate throughout the complex digital media landscape that is now present. This applies also to businesses, especially small businesses, as reputation is a crucial part of business enterprise risk management (Arnold, 2006). A business’ success is based on its reputation by many consumers and is measured by how much it is trusted by consumers, stakeholders and employees. When consumers hear good things about a business they are develop brand trust even before actually experiencing the businesses service. With the introduction of social media such as ‘Twitter’ consumers are able to voice their opinions on companies and brands more openly. Negative reviews on social media towards large businesses/brands are often ignored and disregarded compared to comments regarding smaller business/brands that is not so prominent in the public arena. The effect of a bad reviews/complaints broadcast on social media regarding small business can have highly detrimental effects.
Personal recommendations is an extremely important marketing tool that has the potential to significantly increase the revenue of companies but also has the ability to negatively effect a company’s revenue. However, with the rapid increase in use of the Internet and social media, negative publicity is spread very differently from ‘word-of-mouth’. Consumers are now more than likely maybe even expected to voice their opinions online with big companies notably Tesco and ASOS having twitter accounts to enable unhappy customers to scan for a deal.