Social Media Marketing Tactics and Corporate Game Theory
Without a doubt, social media has come to dominate contemporary marketing strategies, particularly corporate ones. Businesses utilize social networks to reach their audiences by creating advertising and marketing campaigns that appeal to large demographics. However, many do not realize that these corporate social media marketing tactics operate under the dynamics of game theory and exist as complex virtual and psychological networks. These social networks are intricately connected, both with one another and with the consumers they seek to attract.
Several aspects of game theory can be utilized the explain the underlying interactions between competing corporations. Each corporation possesses a core marketing strategy — the dominant strategy — to most effectively reach target consumers. According to CoSchedule, game theory can be utilized as an analysis of “conflict or cooperation” between two parties, or corporations. In this situation, the adversary takes the form of competing corporations and businesses. An particular corporation has to most effectively allocate its social media resources — and social capital — to form and maintain connections with the largest audience demographic. In this economic game, corporations will compete amongst each other to create the largest network of loyal consumers, according to the academic paper about behavior games . This concept of game theory can also be used to explain the mechanics of Twitter as well as other brand-based websites and applications. The majority of businesses and corporate brands have created Twitter accounts, and they actively seek to maintain the largest follower-count to highlight the brand’s popularity, innovative nature and consequently develop a culture of success. The large, almost overwhelming, amount of businesses in the realm of the realm of the Twitter networks reinforces this theory. These actors — businesses, corporations and brands — are simply in a competitive game to maximize follower count as a way to improve their individual reputations.
As a result of its connection to both social networks and game theory, corporate social media marketing strategies are highly applicable to the class. Corporate marketing strategies that utilize social networks operate under the theory of triadic closure, which has been discussed in class and on assignments. According to this theory, individual actors are more likely to form a connection with another actor if the first actor shares a mutual connection with the other. Inherently, networks — in this case social networks — are strengthened by mutual ties and connections. On a broader spectrum, the system of social media operates as a large network, with individuals and corporate entities forming the actors. Corporations, more abstractly, serve as the linkage institutions that create the bonds between these actors. A corporate brand, concept or idea can form a bond between two otherwise-unrelated individuals. This helps establish a mutual sense of identity and ultimately form the connections that lie at the very core of a network’s structure.
Brand Facebook pages are examples of corporate social media advertising tactics that directly use this networking property. In fact, the psychology of the appeal of brand-based social media clearly reveals a direct application of this theory. A particular person is more likely to be drawn to a particular brand page if that individual possesses friends who like, share and publicly support that page. For example, I am personally more inclined to explore a particular brand via social media if one of my close friends has “invited” me to “like” that brand’s page, or shared it on their social media feed. This tendency — a representation of the psychology behind branding — can be explained by triadic closure property. Social, or human, networks are inevitably strengthened by a sense of familiarity. As humans, we instill a sense of trust in our close friends and people who we are familiar with — we trust their judgement. Therefore, we feel more inclined to try and like brands, business and concepts that our friends explicitly support: familiarity holds a sense of comfort and, thus, exists as the basis of network creation.
http://coschedule.com/blog/game-theory/
http://www.cirano.qc.ca/pdf/publication/2013s-18.pdf