New research about digital marketing trends published today shows that social media engagement is rated as both the top priority and most exciting opportunity for companies this year.
But while the fourth Quarterly Digital Intelligence Briefing, published by Econsultancy in association with Adobe, shows a huge appetite for social media programmes, there is a worrying lack of commitment to investment in associated analytics and measurement.
Research for this report found that, along with content optimisation, social media engagement is rated as the top priority for digital marketers out of a range of digital-related marketing activities and disciplines.
Asked to indicate their top three priorities for the year ahead, companies surveyed by Econsultancy and Adobe found that these areas will be more important in 2012 than other disciplines including conversion rate optimisation, mobile optimisation and content marketing.
Social media analytics lagged behind in ninth place.
More than 600 companies surveyed for this report were also asked about the 'most exciting' digital-related opportunities for their organisations in 2012. This is what the survey found:
- 54% of client-side respondents said that social media engagement featured among the three most exciting opportunities.
- 38% ranked mobile optimisation second on their agenda.
- 37% ranked content optimisation as their third priority.
Again, social analytics is much further down the pecking order, this time in eighth place.
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While no-one will be surprised that social analytics are not widely seen as being the sexiest element of the social marketing landscape, neglect of this area may explain why many companies are still struggling to justify new hires based on proven upside from social media campaigns.
The chart below shows that lack of tangible revenue from social media is a key challenge for almost half (48%) of companies and 51% of agencies surveyed.
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As the report discusses, there are certainly high-profile examples of companies making substantial cost savings and proven return on investment from social media investment.
Procter & Gamble CEO Robert McDonald recently told Wall Street analysts that he was moderating the company’s $10 billion ad budget because digital channels can be “more efficient” than traditional media channels, citing P&G’s Old Spice campaign as an example.
While this campaign’s success wasn’t wholly attributable to social media marketing, it is clear that the social element was fundamental to its massive footprint.
Despite celebrated socially driven campaigns such as the Old Spice example, the chart above suggests that, for many companies, social programmes have so far failed to produce the revenue to support them, let alone produced ROI beyond those investments.
In the briefing, we analyse in more detail why the focus on social media engagement makes sense for most companies (for a range of business objectives), and why this activity needs to be seen as part of a bigger picture with a focus on analytics and attribution.
COMMENTARY: In a blog article dated January 4, 2012, I told you clear as a bell that social media is a failure in generating sales, explained why this happened, and what social media marketers could do about it. The above eConsultancy and Adobe study confirms what I said, reporting that 48% of companies and 51% of social media agencies failed to report ANY tangible revenues from social media.
In a blog post dated February 10, 2012, I commented on a study by Lopez Research and the Software & Information Industry Assoation (SIIA), reporting that 90% of small businesses use social media, 70% say social media has a positive impact, but don't spend much time on social media marketing. However, 50% of small businesses spend less than 10 hours per week on social media. Again, social media ROI was iffy.
In a blog post dated January 7, 2012, I commented on the findings of a new report from Altimeter Group warning companies and brands about being overwhelmed by the proliferation of social media. The study found global corporations are now struggling to manage an average of 178 business-related social media accounts, spanning Facebook, Twitter, LinkedIn, YouTube and Foursquare, among others.
In a blog post dated January 30, 2012, a new study from Australia's Ehrenberg-Bass Institute indicates that just around 1 percent or so of those "liking" a particular brand on Facebook actually engage with it in any meaningful capacity.
According to the Ehrenberg-Bass Institute researchers, the percentage of "People Talking About This" versus the brands' total fan base was around 1.3 percent in total – as in, a very small percentage of those "engaged" with the brand, by initially showing interest it, were actually interacting with the brand in any capacity.
If you subtract Facebook "likes," or the simple act of clicking on a particular status update or other Facebook object to "vote" an interest in it, and the brand engagement percentage drops to around 0.45 percent.
In a blog article dated January 26, 2012, I told you about a study by Insight Strategy Group reporting that nearly two-thirds (64%) of people say they “hate” when a company targets them through their social networking profile, and 58% agree that social media marketing is invasive.
In a blog article dated December 25, 2011, I told you about a comprehensive new report from comScore that reported that social networks account for one of every five minutes spent online, making it the most popular online activity worldwide . What’s more, it leads all content categories in the number of display ads delivered, accounting for more than 1 in 4 U.S. display ad impressions (28%).
However, in spite of the tremendous growth in social network users by Facebook and Twitter, the comScore study found that social networking lags when it comes to attracting ad dollars, capturing 15% of spending on U.S. display advertising -- despite serving up more than a quarter of the impressions. Social networking in the U.S. is synonymous with Facebook, which alone served up more impressions in the third quarter than the four major portals combined.
Most brand managers agree overwhelmingly that social media is great for building brand awareness and engaging with their fan base, and this is where most brand managers are spending most of their time and resources. Although social media usage has exploded worldwide, it is a very poor channel for generating significant sources of revenue, and most brand managers are content simply to spend their time on fan engagement, creating brand awareness, and getting fan feedback for marketing research purposes.
Having said this, I find the fourth Adobe Quarterly Digital Intelligence Briefing very much in line with my own observations and opinions about the effectiveness of social media--it's terrible for generating significant revenues, and the ROI's simply don't justify spending a lot on social media advertising.
Courtesy of an article dated February 13, 2012 appearing in eConsultancy
Great information. We are now faced with the question of what to do next.
Posted by: joint pain during pregnancy | 04/14/2012 at 05:12 AM
You need to read my post dated March 20, 2012 http://xurl.at/3p8 about why I believe Facebook's revenue model, and that of most social networks using that model, is deeply flawed, and that the social giant already reached a critical inflection point in late 2010.
Facebook's growth has already began to slow down tremendously and will rapidly reach a peak, limiting its ability to increase ad revenues. The idea that you can throw more ads at users, something that Facebook plans on doing by offering "in-stream" and premium over-size ads is very destructive. All this will do is pissoff Facebook users.
What Facebook and other social networks seem to forget is that a social network is seen as a private and almost sacred social space by its users, and they consider ads invasive and interruptive to the enjoyment of social engagement. The ad agencies understand this, and when they look closely at nearly non-existent ROI's or the inability to measure results effectively, they are not buying ads, preferring social engagement and creating brand awareness through Facebook's freemium service.
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Posted by: Thesis Writing | 02/21/2012 at 12:05 AM