By admin - August 6th, 2014
How corporations are using the myriad of social media channels available to them has evolved to become an integrated marketing mix
How corporations are now using social media has always been a fascinating question to ask over the last four years. Social media gained its entrance into the corporate environment via marketing. However, as social media has evolved, so has its use across many corporate departments. Last year’s study concluded that 90% of companies now use social media as part of their wider marcomms strategy.
This year’s findings conclude that marketing remains the core focus of social media activity within corporations. Communications was stated as a focus in 85% of respondents, with customer services reaching nearly 60% which isn’t surprising, as consumers have increasingly been turning to social media networks – most notably Twitter – to connect with brands for customer services queries. According to research carried out by Simply Measured, customer service queries via Twitter have increased by nearly 50% over the past year.
Naveen Narayanan, Global Head Talent Acquisition at HCL Technologies told Useful Social Media: “Communications have become more important as competition in the industry continues to increase. To be heard and retained by external customers and internal stakeholders is more important than ever. Social tools can help to strengthen brand perception by communicating core values to a wider audience. This, in turn, opens up the opportunity to start conversations, grow business partnerships and expand the online community to win new followers and potential customers.
“To do that however, it is key not to fall in the same trap as with traditional marketing tactics – repeating the same old strategies over and over again. Businesses need to harness the possibilities online platforms have to offer and present the audience with fresh and original ideas. It is important to consider that, after several years of social media, people have grown accustomed to the new media.”
In the B2B space
Turning to the results within B2B, we see that marketing tops the list (87.9%) of what corporations in this sector use social media for, with communications at 83% and customer insight coming in at 54.5% One result we found particularly pleasing was that this year’s study found 42% of B2B respondents now use social media as a component of their customer services delivery. This is in comparison to last year’s 36%. For the B2C sector we found 70% of respondents used social media for customer services, 80% for communications and 91% for marketing.
And when asked how B2B corporations would be using social media by the end of 2014, the figures show an even larger improvement with marketing at 88.3%, communications at 86.8%, customer services 52.1% and customer insight at 69.3%. Clearly the shift in how companies manage their customer services queries is increasingly moving into the B2B sector. For B2C we found 81.5% using social media for communications by the end of 2014, with 70% for customer service and 72% for customer insight. Marketing though, still holds the vast majority of activity at 89%
Social media is also now being used for much more than marketing campaigns, as our findings indicate that corporations are increasingly understanding how social media influences their brands. After marketing the largest use of social media is communications and brand enhancement.
HCL’s Naveen Narayanan continued: “As a part of the on-going quest to stand out from the competition, companies must listen and learn from their audience and have to map their findings against what else is going on in the social media sphere.
“For example, at HCL we’ve recently used Twitter as an online recruitment tool, not only to uncover new talent, but also to build brand awareness. Another campaign saw the launch of a LinkedIn application aimed at encouraging users to go above and beyond the scope of existing contracts. The application allows users to log in and acknowledge professional relationships that they feel have gone ‘the extra mile’ by adding a personal note of appreciation.”
Budget allocation continues to slow
The allocation of budget to social media has continued to rise, but as we stated in last year’s report, the funds for social media activity was slowing, this year’s figures support that view.
“I find an inherent flaw in having a ‘social media budget’,” concluded HCL’s Naveen Narayanan. “There should be a budget for an overall communications campaign and when the company evaluates all available tools and finds social media to be the best available tool, then there should be budget allocated to this. Otherwise you would create the impression that social media is an alternative that needs to be promoted. This is not true - you can’t find a medium, which has more reach and a higher return of investment than social. Yet, if there is no budget allocated to social, then the problem lies in people understanding how to use the medium effectively.”
Last year 58% of respondents stated their social media budgets would expand. This year we saw a marked 14% drop in corporations stating they would be increasing the budget allocated to social media. However, over a third (35.6%) bucked this trend and stated that their businesses planned to increase their budgets in this area.
If the budget allocation figures are looked at in more detail, we see that 20% of respondents will increase their social media budgets by 25% with a similar number forecasts a budget increase of between 6 and 10%.
Looking at large increases in budget of 75% or more, we reported a steady decrease from its height in 2011 of 29% to just 5% last year. The figure for this year is just 1.5% further cementing the trend that indicates allocations of budgets is significantly slowing.
One finding could explain the lack of budget allocation expansion: when asked whether respondents could link an increase in social media budgets with more social media activity, we see an even split between those that answered yes and those that answered no. Clearly there is still an issue with social media ROI and how this directly links to budget spend.
When we look at our findings especially for the B2B sector we find that 42% of respondents stated they would be increasing their budgets for social media activity this year, roughly in line (38%) with our respondents in the B2C sector. We also saw roughly static figures across both sectors when we asked what budget was actually allocated to social media activity.
Over 90% of respondents (93% for B2B and 97% for B2C) believe that social media is an important part of their marketing strategy, but it seems still cautious when actually allocating budgets of more than $10,000. In the B2B sector 22% of respondents stated their social media budget would increase by between 11% and 25%. The corresponding figure for B2C is 15%
Social is still important
You could be forgiven for thinking that social media has not made the gains expected. However, looking back at last year’s report we saw that 93% of respondents state that social media was a vital component of their business’ marketing activity. It’s gratifying to see in this year’s report that that figure is unchanged.
We have also seen a shift in how corporations develop their social media campaigns. The strategy that is being used to develop social media as a marketing mechanism also continues to evolve.
This year just over half (51.3%) of respondents are paying for social advertising – the figure for last year was 36%. This does show a shift in relevance that social media is having within campaign management. But we don’t see budgets increasing significantly to fund this spend.
We do though see a significant shift in the awareness of the C-suite when the importance of social media is measured. Last year we showed that 45% of CEOs were convinced of the importance that social media had to their companies. This year we see a 10% jump to over 55% which is a welcome move and puts corporations on the right path to further developing their social media activity.
2014 is the year that corporations will cement their use of social media across their marcomms activity. Social media has now broken out of its marketing silo. What we can expect by year’s end is a continuation of social media’s broadening influence that will have a profound impact on customer insights, product development and tellingly, on commerce.
This year’s study concluding that 45% of respondents will leverage the social networks within their commercial activities, which is a clear indication that social media is becoming a commercial space.
November 2014, New York
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