Gartner’s social media survey performed year after year continually shows that the top reasons for businesses investing in social media is for improving customer relationships. The top reasons for investing in social media are the following:
1. Strengthen Relationship with Customer
2. Enhance Brand Awareness or Brand Preference
3. Share Information and Ideas With Customers, Suppliers and Partners
4. Establish Interactive Relationship With Customers
5. Increase My Organization’s Revenue Through New Products, Customers
This is a significant finding for marketing organizations because it shows that the top five reasons for investing in social media for companies are certainly under marketing’s purview. In addition, these specific marketing purposes and use cases can ultimately be connected to an actual business benefit: Revenue from customers.
While investments and growth in social marketing is assured during the next two years, the ultimate success of social will depend on how well marketers can accelerate through the inevitable social expectation bust and make social marketing projects more than just “engagement” objectives and actually tie social activities to clear and measurable business objectives. Far too many companies are still following the hype of “social” and have created or participated in social media without a plan.
There are many challenges or barriers to the adoption of social. This varies by industry. For instance, our survey shows that the wholesale industry still state a lack of strategy or understanding around social media in general as a significant barrier to mass adoption. A pressing adoption challenge for financial services firms are the regulatory hurdles. For example, The Financial Industry Regulatory Authority (FINRA) set specific guidelines on social media activities, such as record-keeping requirements. These guidelines and other regulatory policies reflect the additional requirements placed on the banking and securities to preclude social media usage.
The top leading concern or challenge across every industry was an unclear business case or clear ROI. Although the media industry has been an early adopter of social media tools and social networking sites for many years, they are still struggling with how to tie social metrics to business metrics. Several consumer-facing industries that were early adopters, such as media, retail, and areas in high technology, are now re-examining and questioning their business strategy around social.
ROI, measurable business value and budget justification for social projects have quickly become unavoidable topics for companies. Social metrics, such as the number of fans, likes, number of weekly tweets, and even areas such as sentiment analysis are not enough to correlate with the contribution of top business objectives, such as churn rate, new qualified leads or revenue increases. The implication of this lack of measurable benefits is that there will be a rapid maturing of the discipline of deploying social applications during the next two years. Users that can prove measurable benefits best are likely to get the next round of funding and maintain momentum in their social software projects after the hype has died.
Marketers must tie social strategy objectives to marketing and corporate strategy — for example, if the corporate goal is to “decrease customer churn by 5%” then explore how a social marketing initiative such as strengthen relationship with customers” will support that corporate goal, and how the results will be measured. While it will be okay to still encourage experimental use of social applications, which can create future unforeseen benefits, they should come with a timeline for observing direct business value.
Our 2013 Social Marketing Agenda (clients only) will focus on:
Using social analytics to find insights to guide decisions about social marketing and direct customer engagement.
Creating programs for measuring and optimizing social marketing, including its effects on other channels and processes to support social marketing ROI and to prove business results.
What to do about the many social marketing trends and technologies that are emerging and constantly changing the landscape.