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Social networks are so popular these days that many  marketers and small business owners may feel compelled to use them regardless of whether they make sense or not for the business. I’ve recently been helping some clients to make these decisions, which can be expensive if poorly considered, and I find that many people still have some very basic questions. So I’ll devote a few posts to practical advice that may help clear up the confusion.

Why all the hype?

Online communities have been around since the earliest days of the Internet and in commercial services like CompuServe and The Well. So what’s different today? In 1998, a site called Classmates.com, which is still thriving, introduced the concept of “profiles” and “friends.” While this nation seems second nature today, it was revolutionary at the time.

The profile is a person’s (or business’) home base. It not only contains personal information about a wide range of topics, but it also keeps track of a member’s activity within the community. This is important, because as members accumulate friends, joins groups and help other members, all of those activities and relationships are captured in their profiles. The more they contribute, the more valuable they are to the community and the more their personal status grows.

Friending is essentially the process of sharing personal information with others. When two people become friends, they exchange glimpses into each other’s lives, much as we create and nurture real-life friendships. Friends relationships are very strong, whether real or electronic. The chance to build and solidify relationships with our friends is one of the greatest appeals of social networks.

There’s also utility in these online relationships. Social networks are great contact managers. Instead of maintaining our own address books, it’s easy to let the network keep track of where people are, what companies they work for, who they’re dating, etc. They also make it easy for us to capture fleeting relationships. Once we friend someone we’ve met at a conference or football game, we never need to lose touch with that person again.

Groups are a natural outgrowth of profiles and friends. Social networks keep track of information that can be used to find other people with whom we share common interests. While most networks don’t allow members to mass-mail other people based upon their interests, they do enable sponsors to buy targeted advertising and people to form relationships within the groups they join. The advantage of starting a group on Facebook, for example, is that Facebook already has information about a vast community of people. Group organizers can take advantage of this information to quickly grow their membership without starting from the ground up.

Profiles, groups and friends — these are the essential elements of social networks. Next we’ll look at how they’re applied on three of the most popular networks: Facebook, LinkedIn and Twitter.