Social media has always been with us.

Who hasn't recommended a product to a neighbor, received a tip from a colleague, or asked for a referral from a friend? From grocery store aisles to cocktail party asides, the "social media" we've commonly called word-of-mouth or relationship marketing have always been the most trusted form of outreach.

In the last few years, however, a dramatic transformation has taken place in this oldest and most effective form of media. It's been a cause for celebration for many, confusion for others, and consternation for a few. What it should not be to anyone, however, is surprising. It's the same transformation that has happened to industry after industry, from computers to cars, televisions to telecommunications.

Social media has gone digital.

As in every other industry, the digital dimension has made an exponential difference in social media. There's no reason to be confused or intimidated by all the talk about Twitter, Facebook, LinkedIn, and the like. They're just like every other time-honored form of social media, except they're online. That makes them accessible from anywhere, anytime. And it makes a huge difference.

Twitter as Cocktail Party

Take Twitter, for example. It's really no different from a cocktail party (a huge cocktail party, to be sure) and the same rules of engagement apply. Many of your customers are there, and so are many of your prospects. As are journalists who write about your industry, academics who study it, and lots of other interesting people who might serve as good referral sources for you. Oh, your smartest competitors are there, too. They're working the room.

There's a lot you can accomplish at this cocktail party. You can get to know your customers better and discuss with them issues they may be having with your product or service. You can meet new prospects, understand their hot buttons, and make plans to follow up with them. You can talk shop with other, noncompetitive companies in your industry, comparing notes and swapping ideas. You can keep an eye on your competition, seeing how they're trying to sidle up next to your customers. And you can make hundreds or even thousands of other connections, honing your expertise and expanding your network of trusted contacts. You might even have some fun.

Ultimately, you can sell things—not at the party per se (that would be tacky), but in the natural course of things as you develop relationships with the people you meet. All of this awaits you in the digital social media world. But only if you're there.

Why wouldn't you be? Lots of reasons. It's too big. It's intimidating. You don't have time for it. You're not a people person. You don't know where to begin. You can't justify wasting time working your way through a sea of humanity looking for buried treasure (after all, you have a business to run). You don't need one more thing on your plate.

All of those reasons may be legitimate, but they don't hold water.

Convenient Networking

In the "analog" world, networking events take place on a fixed date at a single location at which there are a limited number of people for a defined period of time. They require a great deal of commitment, and you have to work around their schedule. But the digital world is different. It's abuzz 24/7, so your calendar isn't an issue—you can drop in whenever it's most convenient and spend as much or as little time there as you care to.

Plus, the millions of people there aren't randomly scattered; at any given time they've sorted themselves into a multitude of conversations. Despite the size of the gathering, those conversations are easy to find using simple search tools. And you can limit those you join based on a specific geographic footprint, from your hometown to the global village.

Then there's the networking. When you meet someone in the digital social media world, you gain access to an entire Rolodex of people they know. You can introduce yourself to others in their network, or ask your new acquaintances to make introductions for you. Most of the time they'll be happy to do so.

As with any gathering of people, the conversations are continually evolving. But the key is that they're always going on. All you need to do to benefit from them is show up, and be yourself (using the same good judgment that you'd use in the analog world, of course—see "The Cocktail Party Test for Advertising." If you can spend several hours there at a time, that's great. If you can only afford to drop in for a few minutes twice a week, that's O.K., too. The key is to become a part of the flow. The rest will take care of itself based on your interests, talents, offerings, and contributions.

Help Your Company Grow

Twitter probably fits the cocktail party analogy best, whereas Facebook may be more like a reunion (swap stories, share photos, etc.), and LinkedIn might be more like a job fair or convention (I'd welcome reader comments on the most appropriate metaphors for each). But all three—and dozens of other social media sites—share the same exponential advantages the digital dimension provides.

Some pundits still snipe at social media, passing judgment from the outside looking in. To them, social media looks like a waste of time. Well, no one ever accused me of being an early adopter, and personally I hate cocktail parties (the analog kind). But since I've entered the digital social media world I've not only met some terrific people, I've found new ways to help my company grow. And I've enjoyed it quite a bit.

If you're still wondering whether social media is for you, recognize that you've been participating in it all along. It may simply be that you need to add the digital component to your analog efforts. You may be a little nervous at first, but log on, listen in, find someone that looks interesting, and strike up a conversation. Before long, you'll be having a grand—and profitable—time.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE