Last Friday Facebook had its initial public offering (IPO) – the world’s largest IPO in history based on value of $100 billion.  Although Facebook was one of the most anticipated IPOs, it was the most disappointing. For the first two days the stock slid down 13% from its IPO price of $38, already causing many investors to lose money.  On Wednesday, after a couple days of decline, the Facebook stock slightly rose up about 2.5% to $31.76.  Although Facebook’s stock had a small jump, it wasn’t enough to save the company from this morning’s nightmare.  Wednesday morning, Facebook shareholders filed a lawsuit against Facebook board, including CEO Mark Zuckerberg and CFO David Ebersman, Morgan Stanley and the other IPO underwriters.

Represented by Robbins Geller Rudman and Dowd, Facebook investors filed a class action lawsuit in the U.S. District Court for the Southern District of New York in Manhattan against the company and its underwriters for withholding negative information from the public.  “The Registration Statement and Prospectus contained untrue statements of material facts, omitted to state other facts necessary to make the statements made not misleading and were not prepared in accordance with the rules and regulations governing their preparation.”  The lawsuit claims that Facebook failed to disclose information about reductions in 2012 performance estimates.  Revisions were not shared with all Facebook investors, but rather, a select few preferred investors.

The other IPO underwriters targeted by the lawsuit include Barclays Capital, Goldman Sachs, JPMorgan Chase and Merrill Lynch.  The three plaintiffs filing the lawsuit are lead plaintiff Brian Roffee Profit Sharing Plan and investors Jacob Salzmann and Dennis Palkon.

On Friday May 18^th, Facebook is expected to hold its first stock offering on the NASDAQ Stock Market, which could value the company at more than $100 billion.  This past Tuesday, the social networking website raised the price range of its stocks to $34 to $38, up from $28 to $35.  On the following day, the company announced that it would add an extra 84 million shares to its stock pool for sale.  If all 421 million shares in the IPO trade on the higher end, Facebook could potentially raise up to $16 billion when it goes public.

All while the Facebook IPO frenzy is taking place, General Motors has decided that it will stop advertising on the multibillion-dollar site.  Though it will keep its Facebook pages, GM has determined that Facebook’s advertisements have little impact on its customers’ car purchases.  Last year GM spent about $10 million to advertise on Facebook – a small amount compared to the total $1.8 billion set aside for ad spending.  Although $10 million barely made a dent in Facebook’s 2011 advertising revenue of $3.7 billion, because GM is the third-largest advertiser in the United States, their decision has sparked other marketers to reevaluate their own Facebook strategy.

What does this mean for Facebook?  Financially? Not much.  However, the social networking mogul company might want to consider investing more time into refining its advertising business (if it hasn’t already).  Though it has customers like Ford and Subaru that are fully satisfied with their current ad results, Facebook will need to provide advertisers with better data and analytics that clearly define the success of their ad placements in order to effectively knock this GM chip off of its shoulder.

Launched in 2009 by Joe Fernandez and Binh Tran, Klout is a San Francisco-based company that measures influence.  It provides social media analytics based on information gathered from users’ social networking sites including Facebook, Twitter, LinkedIn, Foursquare, YouTube, and Google+.  Influence is measured by Klout Score, which is on a scale of 1 to 100.  According to the Klout website, “The Klout Score measures influence based on your ability to drive action.”  Klout uses data received from the various social networks in order to measure:

True Reach: How many people you influence
Amplification: How much you influence them
Network Impact: The influence of your network

As of April 2012, the only person with a perfect 100 Klout score is Justin Bieber.  Many of the (real) world’s influential people, like Bieber, have Klout scores because they are actively engaging in social media.  According to Mashable, “More than half (53%) of the Time 100 had Klout scores because they were participating in social media.”  Essentially, the more tweets, followers, likes, retweets, shares, posts, and updates you have, the better your Klout score.  Consequently celebrities and brands tend to have higher Klout scores than the average social media blogger.  Yet, with all of these Klout scores floating around the Internet, one begins to wonder: What does the score really mean?  Does it mean anything at all?

Klout has been subject to a significant amount of criticism since its emergence.  In 2011, TechCrunch even went so far as to say that “Nobody gives a damn about your Klout score.”  Many of its critics claim that Klout doesn’t actually measure your influence but rather measures your capability to influence.  However, to some companies, Klout scores do matter.  Almost one year ago, Sam Fiorella was recruited for a VP position at a sizeable marketing agency in Toronto.  Fiorella had 15 years of experience working with major brands such as AOL and Ford.  Unfortunately, even with his impressive resume, Fiorella was denied the job.  Why?  Specifically because his Klout score was only 34.  Fiorella later learned that the company hired someone with a score of 67.

So are Klout scores important or are they not?  Well, we’re not completely sure yet but we’d better play it safe than sorry, hop on the bandwagon and hike up that Klout score.

In 2007, Facebook co-founder Chris Hughes left the social networking company in order to serve as the social media director for Barack Obama’s presidential election campaign.  Hughes’ key tool in the social media campaign was My.BarackObama.com, a networking website that allowed Obama supporters to create groups, organize events, raise funds and connect with one another.  In addition to launching the MyBO website, Obama defined his social media presence by capitalizing on all the social networking platforms.  The Washington Post even went so far as to name him the “Social Networking King.”

Obama’s popularity among social networking sites was all thanks to Hughes and his thorough understanding and vast knowledge of social networks.  Hughes understood that the most significant component of social networking sites is the ability of users to communicate with one another.  Therefore, in order for Obama to successfully reach people online, Hughes advised the presidential candidate to set up shop on all the major platforms: Facebook, MySpace, Twitter, LinkedIn, Digg, Flickr, YouTube, Eventful, Black Planet, Faithbase, Eons, Glee, MyBatanga and AsianAve.  However, what made Obama king of social networking was not how many website accounts he held but rather what he did with these accounts to help him advance in the Presidential race.

Obama’s social media team effectively used social media outlets to their full potential by publicizing every speech and event on these online platforms (wherever possible).  On YouTube, clips of speeches or events were edited and uploaded within hours of them taking place.  On Twitter, tweets with information and links were posted frequently, providing Obama’s followers a constant flow of information about the campaign.  On Facebook, Obama defined and refined his image by adding personal information about himself, such as information about his favorite musicians, to his personal page and by creating Facebook groups such as “Barack Obama (One Million Strong for Barak)” and “Students for Barack Obama” for people to join.  Essentially, Obama moved quickly and efficiently across all social media platforms, which helped turn his followers into supporters and supporters into voters.

When you think about it, a presidential candidate is like a brand and a brand needs to strategically market itself in order to be recognized.  That is exactly what Hughes and the rest of the social media team helped Obama to do – brand himself.  Once Obama became a household name, it was easy to further tap into the power of social media by allowing the networking effect to run its course.  Within months, support for Obama grew exponentially across the nation.  In this century, the majority of the American people are on the Internet and that is exactly where Obama focused his attention, which made all the difference.

On February 26, 2012 in Sanford, Florida, 17-year-old Trayvon Martin was walking from a grocery store to his father’s gated community home when George Zimmerman, a neighborhood watch volunteer, pursued him, fought with him and eventually shot him.  Before the wave of social media took this case for a ride, the only news coverage that it received was a mere four-paragraph report in the Orlando Sentinel two days after the shooting occurred.

What started the flood of social media activity was the posting of a petition on Change.org, “a social media platform that empowers anyone, anywhere to start, join, and win campaigns for social change,” as stated on their website.  On March 8^th, Trayvon’s parents asked the world to help them prosecute the killer of their beloved son by signing their petition on the website.  The Martins need a total of 2,500,000 signatures but have already acquired 2,259,870 to date, all thanks to the power of social media.

Outraged people from all over the nation posted the link to the Trayvon Martin petition on their Facebook, Twitter, blog and other social media outlets.  Once the story was put into the spotlight, countless articles reporting the Trayvon Martin case were shared on Facebook and Twitter thousands of times.  Immediately, hundreds of thousands of posts and tweets took the internet by storm and helped spread the word about Trayvon.  It was as though the campaign grew exponentially overnight.

On March 28^th, Rep. Bobby Rush was kicked off the House floor for wearing a hoodie in honor of Trayvon Martin.  Rush began his speech in a suit but soon took off his blazer to reveal a gray hoodie.  During his speech, he stated, “racial profiling has to stop.”  Inspired by this brave act, hundreds of protesters organized the ‘Million Hoodie March’ that took place in downtown Los Angeles on Monday, April 9^th.  The protestors wore hoodies while they silently marched to demand justice for the shooting of Trayvon Martin.  With help of Facebook and Twitter, this and several other Million Hoodie Marches have been able to successfully take place across the nation.

Unfortunately, social media can sometimes act as a double-edged sword.  While social media platforms are excellent tools for social injustice advocates who want to use the outlets as an online megaphone, it is also a great place for false information or bad press to get sent out to a massive amount of people in a blink of an eye.  The worst social media activity relating to the Trayvon Martin case that prompted wide criticism was a retweet of Zimmerman’s alleged home address by film director Spike Lee (who has over 250,000 followers on his Twitter).  The address was incorrect and forced the actual owners of the home to flee their house. This awful event proves to show how influential social media can really be.

Currently, Zimmerman is in police custody and has been charged with second-degree murder.  Tweets, re-tweets, posts, shares and status updates have and will continue to inundate everyone’s news feeds as the world awaits the verdict.

Social networking websites such as Facebook, Twitter and LinkedIn are quickly being added to the background check roster as employers are finding that these sites are full of insight and information about their potential employees.  And the snooping doesn’t stop there.  Many companies have even gone the extra mile to ask prospective and current employees for their Facebook passwords.  Is that going too far? We think so, and apparently Facebook does too.

On March 23, 2012, Facebook released a written statement objecting employers from asking prospective and current employees for their usernames and passwords.  Facebook’s chief privacy officer for policy, Eric Egan said, “This practice undermines the privacy expectations and security of both the user and the user’s friends.  It also potentially exposes the employer who seeks this access to unanticipated legal liability.”  Facebook stated that sharing or soliciting a password is a violation of the company’s Statement of Rights and Responsibilities and suggested that they would potentially sue any company that asked for such sensitive information from an applicant or employee.

Just a few days later, on March 27, 2012, the issue escalated to Congress where the Republicans in the House of Representatives voted against a proposal that would’ve legally prevented employers from accessing employees’ Facebook passwords.  The proposal, “Mind Your Own Business on Passwords,” would have resulted in the addition of an online privacy-specific clause to the Federal Communications Commission Process Reform Act of 2012.

There have been many cases where an employee has lost their job due to a post, tweet or update on a social media platform.  Here a few high profile cases:

December 2009, Connecticut – Dawnmarie Souza was fired from her job for posting insulting and profane comments about her supervisor on Facebook.  The National Labor Relations Board (NLRB) filed an unfair labor practice complaint against her employer, American Medial Response of Connecticut, Inc., arguing that Facebook posts were protected speech under federal labor laws. 

February 2012, United Kingdom – John Flexman was forced to quit when his former employer, BG Group handed him a list of disciplinary charges and told him he would be fired if he did not remove his CV from his LinkedIn profile.  In addition to uploading his CV, Flexman had checked a box to mark his interest in “career opportunities.”

March 2012, Michigan – Kimberly Hester was put on suspension and unpaid leave for refusing to provide her employer, Less Cass Intermediate School District with her Facebook password.  She had posted a picture of her co-worker’s pants around her ankles with the caption “Thinking of you.”  This incident sparked the chain of events pertaining to Facebook passwords mentioned above.

What does this mean for employers and employees?  Employers should tread lightly when dealing with social media as a means of background screening for applicants and should refrain from crossing any boundaries with current employees.  Employees should use privacy settings to the best of their advantage and most importantly, think before they act, or should I say tweet?

Pinterest is quickly becoming the latest craze in the world of social media.  Although the site launched back in March 2010, Pinterest has recently gained tremendous momentum, having grown more than 4,000% in the last few months.  What makes Pinterest stand out from the rest of the social media platforms is its use of visual stimulation.  Rather than inundating people with bits of text, Pinterest attracts its users with images and photos that are much more fetching.

So what does this mean for your business?  If your business can’t be represented visually, it means little to nothing.  But if your business has tons of photos and videos associated with it, it potentially means a lot.  Due to its highly self-expressive nature, Pinterest allows companies to not only visually showcase their work but also to refine their brand personality.  From creative to informative, different kinds of pinboards can be created in order to help your brand increase its online presence.

Recently, Kotex jumped on this fresh opportunity to use Pinterest as a way of ingeniously engaging their users with a “Woman’s Inspiration Day” campaign.  Targeting 50 influential female Pinterest users, Kotex studied their Pinterest boards and handcrafted gift boxes for them based on what they seemed to like the most.  All that the women needed to do to receive these boxes was to re-pin their gift box.  The result? 50 gift boxes and 694,853 total impressions.

Earlier this week I attended the March Breakfast hosted by Social Media Breakfast Los Angeles (SMBLA) held at the Coupa Café in Beverly Hills, CA.  Creative Asylym Digital Marketing Strategist, Vladimir Kroshinsky gave a humorous yet informative presentation about “Social Media for Entertainment Brands.”  Having worked with many large entertainment brands, Kroshinsky delivered a presentation full of valuable tips for those new to the social media sphere.

Although his portfolio is full of excellent ideas for tweets and blog posts, Kroshinsky primarily focused on the creative uses of Facebook as a social media tool for entertainment brands.  According to Kroshinsky, when it comes to Facebook, it is important to know what to post and when.  By posting the right things at the right time, entertainment brands can effectively use Facebook in order to build a larger fan base, create more word-of-mouth, develop a brand personality and successfully promote past, present and future projects.

First, brands need to find their primary focus – Which social networking platform has most of the fans?  Second, brands need to engage their fans with media content that draws them to their page, such as a funny picture or a viral video.  (Even Kroshinsky inserted funny pictures throughout his slideshow in order to hold our attention—and it worked!)  Then, brands need to focus on what they want their fans to know, see and talk about.  Fans are the sales force, so brands should utilize them by feeding them with knowledge (ex. Movie trailers, sneak peaks, tidbits of information).

There are several things, however, that brands should not post on their Facebook page.  To list a couple, brands should not promote one movie on another movie’s page and brands should not get a ton of fans for a movie before it actually comes out.  Promoting on a different page can come off as too pushy and prematurely adding a ton of fans can cause a wave of hate if the movie flops.  Instead, the appropriate thing to do would be to engage in cross-promotion.  Through cross-promotion, brands can allow fans to constantly switch back and forth between their various Facebook pages by referencing one page on another and vice versa, ultimately creating a full-circle ecosystem of Facebook fans.

To be ahead of the competition, brands should post when everyone else isn’t posting.  Monday is the most popular day to post.  Therefore, by posting on Monday’s, brands end up competing against a million other posts for their fans’ attention.  Instead, brands should post during second screen hours when their fans are at home or later on during the week when the rainstorm of posts has turned into a drizzle.  Lastly – although many advise against it – reposting the same promotion over a period of a couple months can be beneficial because there are always new sets of eyes to reach.

Give to Get Jobs CEO/Co-Founder Stacy McCoy

Launching a startup in undoubtedly an uphill battle, with our increasingly entrepreneurial society vying for their latest ideas to be heard above all others.  Social media has allowed these companies to have more creativity and get the most out of their often nonexistant marketing budgets.  We recently spoke with Give to Get Jobs CEO and Co-Founder Stacy McCoy to find out how the strategic use of social media has affected the growth of her startup.

Can you tell us a little bit about your business and how it got started?

Give To Get Jobs is a job board and information hub for jobs in the for-profit sector with a social and/or environmental mission, mainly social enterprise and corporate social responsibility/sustainability.  As a social enterprise ourselves, we donate a portion of the proceeds to fund job creation programs via our non-profit partner, See Your Impact.  It was born out of frustration.  I had spent time in the non-profit sector and the corporate sector, but came increasingly interested in the gray area in between.  Because the sectors of social enterprise and corporate social responsibility are not streamlined, it was a long and arduous task searching for jobs via traditional methods.  Instead of continuing to complain about it, I decided to fix it.  Give To Get Jobs officially launched on May 2^nd.

Did you know you wanted to implement social media from the beginning?

Yes.  We are 100% self-funded at the moment.  Having a limited marketing budget, social media was an obvious must.

How involved were you in social media before you began your business?

My freshman year of college was the year Facebook launched.  I was a Facebook user from the very beginning, but only for personal reasons.  I also used LinkedIn for its basic services.  I had very limited knowledge of how to use social media for business.

What social media platforms do you use for your business?

Twitter, LinkedIn, Facebook, and Google Plus are the main social media platforms I use for business purposes.  I also try and blog an average of twice per week.

Which social media platform do you use the most?  Which is most effective?

I use Twitter the most.  What is most effective probably depends on how you define effective.  We get the most traffic from LinkedIn and Facebook.  But, Twitter has been the best relationship-building tool.

Do you use any third party agents (Tweetdeck, etc.)?

I use Tweetdeck.  It changed my life when I started using it.  I’ve used ManageTwitter to manage who I follow and get rid of inactive users.   I also use Klout to keep track of my business and personal brands and make sure they’re targeted and focused.
Do you have any plans to expand your company’s social media presence?

I am planning on starting a separate blog that is more interactive and indirectly tied to the business.  I am also hoping to incorporate video through either YouTube or Vimeo.

Do you find that your social media reaches mostly those seeking jobs?  Do you feel you are effectively reaching those who are supplying and potentially listing the jobs?

My social media outreach via LinkedIn definitely reaches job seekers.  Facebook has been another great tool to reach mainly job seekers.  Being a B2B and a B2C company, we also use social media to connect with other companies, recruiters, and professionals in the space.  It’s a hard balance to strike at times, figuring out which audience to gear social media content towards.  But I think we have done it well so far and have been able to reach people on both sides of the job search process.

What has the ROI been like?  Have you been able to see your social media strategy translate into financial gains for your company?

Social media is a big part of creating visibility for the jobs that are listed on our board.  LinkedIn is one of the tools that have helped us find job applicants.  Providing employers with a quality group of job applicants is the main reason our clients keep coming back.  On the employer front, social media has enabled us to build relationships with people we would otherwise not have been able to reach.  Twitter has been particularly important in this way.  However, the biggest financial gain on the employer side has come from direct outreach via email and in person not social media.

Has your opinion on social media changed at all since you’ve begun using it more to engage for business?

Yes!  I have a much better understanding of branding and how important social media is in creating a brand.  I’ve also come to understand that everything you put on the Internet becomes part of your brand; it is your online resume.  And it’s important to keep that in mind every step of the way.  You have to use social media appropriately and with caution in some ways.  Because it all factors into how people see you and your brand.  Social media must be used strategically.

What is the most inspiring incident that has occurred for your business as a result of social media?

The most inspiring thing has been taking online relationships offline.  I have met numerous business contacts online via Twitter that have become friends and real life business contacts offline.  Social media isn’t just a fluffy tool to feign engagement with your customers and clients.  It really is a relationship-building platform.  And those relationships are real.  The people that support you online sign off and support you offline.  The number of people in your corner multiplies.  That is what is most inspiring about social media.

Where do you think your business would be today without such an emphasis on social media?

We certainly would not have been able to build the traction we have had in just a short handful of months.  The growth we have experienced would have been slower.  It would have been a lot harder and more expensive to create a following and an engaged audience.  Social media has leveled the playing field in a lot of ways.  It has been a big part of our success thus far.

Let’s face it, gone are the days where kids get together with their neighbors and carelessly play freeze-tag and capture the flag until dinnertime.  Now, they are practically born with an iPhone in their hands and seem to know more about social media than their parents do.  So in a world that is growing more and more “virtually connected” does it make any sense to try to shield your children from it?

Facebook users are required to be 13 to create an account, although it doesn’t take a genius 10 year old to figure out that they simply need to manipulate their birthday to reflect this and get around the official requirement.  And since many of their friends are going to be jumping into social media, they are likely to be secretive in order to make it happen for themselves.

It is important for parents to communicate their feelings towards their child’s activity on social media, but also to be realistic.  While it is entirely understandable that parents would like to shield their children from the transparency that social media provides and the potential harassment, being too harsh with rules is likely to only create more problems.  If parents, instead, work with them to create a profile with privacy settings that both parties comfortable with, then they will actually have a more active role in protecting their children’s privacy.

Take some time yourself to really understand all the privacy settings and which would be most important to a child’s privacy.  Here are some suggestions:

• How they can connect with others: Go to Privacy Settings –> How You Connect –> Edit Settings and Select “Friends” for all options, allowing only those that your child already connects with to search for them, send friend requests and messages, post on their wall and view wall posts.
• How/who they share their photos with: Go to Privacy Settings –> How Tags Work –> Edit Settings and Select “On” for Profile and Tag Review to make it so that your child must first approve of a posting that includes a tag of their name or photo before it gets posted to their profile.  Next, select “Friends” for Maximum Profile Visibility to allow only friends to view tagged posts that have been approved.  Lastly, select “Off” for Tag Suggestions and Friends Can Check You Into Places in order to turn off geo-location for your child.

It is important for parents to have open communication with their child about their involvement in social media.  There is no way that you can be the controller of their Facebook account or have alerts sent directly to you, Facebook only allows the intended user to access their account, even if they are under 18.  If parents establish trust with their child and their social media activity and maintain and open conversation about it, they are less likely to act out recklessly and “overshare” and potentially put themselves in harms way.

But one thing is for sure: Your child WILL get a Facebook account, better to accept it now.