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Social Capital 101

November 24, 2009Sparxoo


By Ethan Lyon, Senior Writer

“Let me introduce you to someone who might be able to help you.” Some people build their entire reputation around this one line. As Malcolm Gladwell outlined in his breakthrough work, The Tipping Point, those who say this line most often are called Connectors. Essentially, Connectors are match makers. They have an enormous amount of contacts, and as such, they have a lot of influence. This social influence can form social capital.

Though not all of us are Connectors, many of us have an inherent desire to connect with others to further strengthen and expand our community. Evolutionary psychologists note this need to form communities and societies stems from our survival instincts (i.e.power in numbers). Though we are not always cognizant of our need to connect, societies are built and thrive based on their social capital. Sociologists have found those communities that engender high social capital tend to report less crime, and even show higher life expectancy rates.

Understanding the Value of Social Capital

As social influencers are the hub of vast networks, they have high social capital. As Malcolm Galdwell outlines, Connectors have an incredibly valuable position in society. They can grow professional and personal networks by making valuable connections.

Not all connections are made equal, however. Each set of relationships carries a different value. Your connection to your family is much different that your connection to your clients, or close friends or online acquaintances. Investing in people with high social capital can be incredibly advantageous for a company–particularly entrepreneurs. For example, though not all projects may pay well in the near term, the social capital of the client might substitute immediate monetary gains for future work.

Social Capital Online

Since the inception the internet, the definition of a Connector has changed. Connections can take seconds or require no effort at all. Twitter followers and LinkedIn connections have completely different value. While the Twitter follower might require little to no effort, the LinkedIn connection requires you have an existing connection directly or through a shared contact. One LinkedIn connection carries more social capital than one follower, as the effort that went into getting that connection is greater and more meaningful.

Social Capital in Groups

Social capital, in the collective sense, creates a web of people based on shared interests or experiences. Social media forms groups by linking similar data points. Like a Connector, social networks such as Facebook will find similar interests or connections and recommend people who might be of interest to you. Groups form under the umbrella of a large social network like Facebook (i.e. through fan pages and shared networks) or through niche communities, such as Twitter Moms.

Individual Social Capital

Individual social capital is when an influencer broadcasts to an audience. Bloggers exemplify the power of individual social capital. Individual bloggers have a network of readers. The blogger relies on user pageviews for advertising and the user enjoys reading the blog. In this way both broadcaster and recipient have a relationship build on reciprocity. Blogs provide even more reciprocity by empowering users to engage the influencer and other followers in a community forum built around the influencer. Blogs enable followers to have a passive and active relationship with other followers and the influencer.

Aligning your Social Capital Efforts with Your Goals

Understanding the value of social capital can grow your business efficiently and rapidly. Developing connections has never been more difficult, yet accessible and rewarding. Are you trying to provide leadership in your market? You might want to consider developing a blog or send updates on Twitter. Are you trying to court particular key individuals. You might want to try connecting with them on LinkedIn to spark a meaningful discussion. Aligning your social capital efforts with your business goals can accelerate your business growth and elevate your impact and voice in the market.

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