Customer loyalty has a lot to do with thought leadership and social networks provide an excellent avenue for that. They’re also a great way to gain customer input on product and service development – and of course, to reinforce brand messaging. In addition, consumers trust other consumers more than they trust brands themselves.

JupiterResearch recently found that 30 percent of frequent social networkers trust their peers’ opinions when making a major purchase decision, but only 10 percent trust advertisements.

Social networks are creating consumer-driven direct marketing; many of your most loyal and engaged customers will be the first to adopt and participate in a social networks. In short, social networks provide marketers with another online channel but don’t let them become another marketing ‘silo’. If you can create a better customer experience by integrating online, offline, and branding efforts across your organization you will have sustainable competitive advantage.

Here are four steps towards achieving it.

1. Examine why you want to develop social networks in the first place

Understand what your objective is and make sure the technique is appropriate – you may be better off spending the budget on more sophisticated email marketing, a new hire or your website etc.

The challenge is identifying what applications (blogs, newsgroups, chatrooms, opinion portals and communities etc) make sense for your organization to take advantage of this emerging channel.

Is your objective customer loyalty or brand? Is it additional sales or improved customer service or maybe its recruitment?

2. Make sure you integrate

Given the fact that most companies hire agencies to build their social networks, ensure you work with one that builds your networks and applications on an online software platform that integrates with email, RSS, web and all your other existing channels.

It is absolutely crucial that you don’t create another disparate application. You need to be able to extract value from the word go.

3. Measure effectively

Measurement is probably your biggest challenge and social networks should be designed with this in mind. If social networks are going to become a mainstream loyalty marketing channel, marketers have to be able to account for the cost. And because there are so many different applications it’s hard to define measurement that is appropriate across the board.

Implementing social networks on a single, integrated marketing platform however, that enables users to make decisions based on analytics from all channels, will help marketers with measuring the loyalty benefits obtained from social networks. In other words you can’t measure customer satisfaction, if they are built as silo applications outside your other marketing channels.

Obviously, measurement of customer loyalty on myspace.com would involve different analytics than Accenture’s technology blog. And of course revenue is a great measurement if appropriate. For example eBay is really a social network – one of the first. It’s a great example of how a social network can be a business model.

4. Enhance existing customer data

Social networks are a good tool to help increase customer insight and feed more online data into your existing database. It’s crucial that you drive traffic to the community and provide interactivity while there in order to grow the network.

You can induce engagement through functions such as ‘forward to friend’ and by allowing negative as well as positive content to be included. It is important not to become involved in a covert way which erodes trust. Have a conversation with customers – don’t just talk at them!

Jason has been building high performance teams to create and implement innovative marketing solutions for over a decade. Jason and his team are responsible for Alterian's global marketing strategy including brand, product, and communications. Prior to merging with Alterian, Jason was the CEO of Dynamics Direct, Inc., developers of Dynamic Messenger™, the first enterprise-class email relationship management platform built on the Microsoft ®.Net Framework. Prior to DDI, Jason managed the Digital Markets Practice for Cambridge Technology Partners (acquired by Novell) as well as served as Vice President at Firstlogic, Inc. (acquired by Business Objects) where he helped companies such as R.R Donnelley, Informatica, Siebel, and the USPS implement database marketing, data quality, and postal automation solutions. Jason serves on many industry boards and counsels including the DMA's Marketing Technology Counsel. Company: Alterian