Can You Build Business Relationships through Social Media?

Every time I start to write (or even think about writing) an article on whether or not a person can build a business relationship online, I shudder, sigh, and give up. I love technology. I study technology’s influences on how people do their work. Many variables effect how people use technology. The human has to adapt the technology to meet the individual, relational, and organizational needs. Perhaps, I know too much on this topic to write anything succinct and cogent. However, that is my objective. Let me start by defining what “relationship” means in my world. I will then discuss what the research tells us about technology use and direct sellers. I will end with a few insights into what I think can work.

What is a relationship? I have defined the difference between a relationship, encounter, and pseudo-relationship in a prior article . My definitions come from Barbara Gutek and Theresa Welsh’s book, The Brave New Service Strategy. In a nut shell, a relationship develops over time. In a business relationship,  the sales-person learns the unique characteristics of the customer and the customer learns the unique characteristics of the seller. Over time both seller and customer adapt to each other to better anticipate the needs of the other. From the customer’s point of view, not any sales person will do. The customer wants the seller that has always helped them. An encounter occurs when the product does not require adaptation or customization. The customer wants the exact same product that the last person in line wanted. Last, a pseudo-relationship is when a seller pretends that they have a relationship with the customer. (Not many of us fall for that trick.)

Direct selling is a relationship business. This should be no surprise to you. By the very nature of technology, the face-to-face interaction that allows us to read the nonverbal nuances of a conversation are less available to us. Technology creates distance. There I said it. However, as with any tool, the outcome of technology use can be both helpful and a hindrance to business relationships.

Research by Ferrell, Gonzalez-Padron, and Ferrell (2010), found that direct sellers use technology in several ways. When you think about technology in direct sales, there are technology connections between the company and the distributor, the distributor and the customer, and the company and the customer. In general, the research suggests that companies are providing more information to distributors about the products, sales training, order collection, recruitment, volume, and compensation. Companies use websites, email, podcasts, webinars, and social media to communicate with distributors. Companies continue to make tools and information available for computers and now for mobile phones.

The second way technology is influencing the industry is distributor to distributor and distributor to customer. Distributors use social media to share videos, pictures, and products. Distributors continue to use email to train on products and sales. Distributors also use their own webpages to share content created by the company and to share their own stories and ideas. Distributors use technology to maintain the relationships that were built face-to-face.

Building new relationships online is more difficult. A lot of people continue to talk about the power of social media. However, little research suggests how or if social media can be used to find and build a new relationship online. Social media works best when it connects people who already know each other. Some research suggests that word of mouth about a product to people we know has some effect on brand recognition. Getting research to connect to actual purchasing continues to be difficult.

One area that did show some interesting research was on how to use Twitter to build new relationships online (Fisher & Reuber, 2011). The research followed 12 entrepreneurs who used Twitter. The researchers interviewed the 12 and then collected all tweets for a six month time period. Basically, what they found was that some entrepreneurs used Twitter to develop new relationships and some did not. They suggest that a person needs to be community oriented and must know and be willing to follow the rules of the Twitter community. This fits with what we know about people who build relationships in face-to-face settings. Some people seem to be more interested in meeting new people and getting to know them and develop relationships. Others struggle with finding and developing new relationships. Certainly building relationships is a skill that most of us can improve.

Building and maintaining relationships through social media and other technologies are two separate processes. It is possible to establish new relationships online. Online word of mouth seems to have some benefits. Those who have good relationship building skills face-to-face seem to find some interesting ways to use technology to start new relationships. However, the rate of success is much lower. The research shows that maintaining relationships through social media can be effectively handled. Facebook, email, podcasts, online videos, and online ordering have all been successfully used by direct sellers and direct selling companies. Direct selling and MLM continues to be a relationship business. Effective relationship skills continue to be important in all mediums.

Ferrell, L., Gonzalez-Padron, T. L., & Ferrell, O. C. (2010). An assessment of the use of technology in the direct selling industry. Journal of Personal Selling & Sales Management, 30(2), 157-165.

Fischer, E., & Reuber, A. R. (2011). Social interaction via new social media: (How) can interactions on Twitter affect effectual thinking and behavior? Journal of Business Venturing, 26(1), 1-18. doi:http://dx.doi.org/10.1016/j.jbusvent.2010.09.002

Gutek, B. A., & Welsh, T. M. (2000). The brave new service strategy: Aligning customer relationships, market strategies, and business structures. Amacom.