In 2010, the unthinkable happened. Facebook took over Google as the most visited site in the world. The event marked the beginning of the era of social media that keeps shaping our world. This includes the world’s markets to a great extent. They are among those segments of our society that have been influenced by the rise of social media.
Real-time Data
Although the quick transfer of news has been around since the invention of the telegraph, the Internet completely revolutionized the way news spread around the globe. Even the slightest tremor on any of the world’s markets is known worldwide moments after it happens, thanks to insiders with large followings. Millions of people read their posts, and they can spread news almost instantly. Sometimes all it takes is one tweet to dramatically alter the price of any stock, both positively and negatively. That is why large corporations are more conscious than ever about lousy publicity since putting a foot wrong could cost their shareholders millions of dollars.
Exposure
Social media has been playing an essential role in attracting new participants to global markets. A lot of new traders had their first contact with markets via social media. Many of them use them to learn to trade every day. Combined with the real-time data transfers, this has made social media the must-have tool in the arsenal of every trader and wannabe trader.
Reach
In 2013, a train owned by CSX Corp collided with a truck in Maryland and derailed. Thirty years go, this would be a piece of minor news and probably wouldn’t have any significant effect on the company. However, in 2013, social media was on the rise. Thanks to people sharing the news, CSX Corp lost $500 million in value in just 90 minutes following the crash. All it took was one tweet from Carl Icahn to see Apple’s shares skyrocketing, making it worth $17 billion by the end of the day. Both these facts go to demonstrate just how far-reaching and influential social media can be. It allows for a real-time event reporting, and the information can circle the globe in minutes, reaching millions of people.
Networking
Speaking of traders, each of them has their favorite insiders who they follow fervently on social networks. They hope to catch a glimpse of news that will allow them to anticipate the market’s movement. Also, they create networks of their own, connecting with fellow traders from around the world. These networks within networks exist with the sole purpose of shielding sensitive information. Ironically, they wouldn’t be possible, or at least not as effective, without social media.
Changing Business Models
Billions of people are on the Internet daily. This massive gathering has prompted even the most conservative companies to pay attention to how they deal with social media. They started creating new jobs and titles like social media managers forcing them to tailor their business models to fit their online presence better. As they were busy doing that, new companies have been emerging, often solely dedicated to doing business on social media. Millennials, the first digital natives in history, are most often the founders of this new generation of companies. And who better to navigate the world of social media than the generation that was born into them?
Fear it, dread it, run from it, the world of social media is here to stay. While nobody can guarantee that Facebook will even exist in its current form in ten years, one thing is sure: there will always be a form of social network ready to pick up the slack. People have had their taste of it and liked it immensely, and now, there is no going back. It is up to you how you use it, but use it, you must.
Marco Lopo is a Sydney-based business consultant and a marketing analyst. He writes about business and lifestyle. He thinks that’s the perfect opportunity to present himself to a wider audience and receive recognition. In his free time, Marco enjoys music, travelling and also is a big reading enthusiast.
