The Social Feedback Cycle is important to understand because it forms the basis of social business. What the social feedback loop really represents is the way in which Internet-based publishing and social technology has connected people around business or business-like activities. This new social connectivity applies between a business and its customers (B2C), between other businesses (B2B), between customers themselves, as is the case in support communities and similar social applications, and just as well between employees.
As such, this more widespread sharing has exposed information more broadly. Information that previously was available to only a selected or privileged class of individuals is now open to all. Say you wanted information about a hotel or vacation rental property: Unless you were lucky enough to have a friend within your personal social circle with specific knowledge applicable to your planned vacation, you had to consult a travel agent and basically accept whatever it was that you were told.
Otherwise, you faced a mountain of work doing research yourself rather than hoping blindly for a good 6c h a p t e r 1: Social Media and C ustomer E ngagement╇■ experience in some place you’d never been before. Prior to visible ratings systems—think Yelp.com here—you could “ask around” but that was about it, and “around” generally meant “nearby,” friends, family and perhaps colleagues The travel agent, to continue with this example, may have had only limited domain expertise, lacking a detailed knowledge of rental versus hotel properties, for example.
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This knowledge, or lack of it, would be critical to properly advising you on a choice between renting a vacation property and booking a hotel. Austin’s Homeaway, which brings tens of thousands of rated and reviewed vacation properties within a click of booking, has built an entire business around empowering consumers looking for vacation rentals as an alternative to hotels and resorts, a market that itself only blossomed post–Internet 1.0.
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