Reports from two studies show social media is not only growing in popularity among consumers but also attracting a sharply increasing share of marketing budget dollars. Social advertising and promotional spend by marketers is projected to reach $38 billion by 2015, according to a report by Williamsburg, VA-based media research firm Borrell Associates.
A report by AWeber Communications, an e-mail marketing software firm, also shows that social media may be a dominant media channel in the future. AWeber found that the most popular tactics among the 2,500 small businesses it surveyed include Twitter and Facebook.
Gordon Borrell, CEO of Borrell Associates, calls the social media the final “disintermediated media.”
“The interest is really disintermediated newspapers. Look at the classified advertising that’s online and all the local news that’s online and disintermediated radio – 43 million people are now listening to online streams of radio broadcasts,” he says. “Well, this [social media] is the disintermediation of the most powerful form of marketing ever, which is word of mouth.”
These and other studies suggest marketers need to master social media now or get left behind. Here are more reasons marketers should learn social media to get ahead of the curve.
Social media plays a key role in effective competitive strategy. Interactive media has complicated the competitive landscape, too, says Burrell. “The stakes are so damn high today. If you do the wrong things, it’s so much easier for somebody to harness the power of social networking and get everybody on their side – all because they just know how to do it and you don’t,” he explains. Borrell suggests small businesses either get up to speed on social media or partner with a marketing consultant who advises business owners. “Find someone who is very savvy overall on marketing and has that business’ interest at heart, rather than his or her own personal commission,” he says.
Bad news spreads rapidly. Customers are in control of the message today, as many organizations, big and small, have discovered. Borrell says companies need to spend a little money to protect their brands. “It’s so much easier for people to communicate, and bad news spreads really quickly. So, if you’re a dry cleaner and you’ve [angered] some guy who really wanted you to get that lipstick stain off his collar and you didn’t, he can go online and really do some damage to your business,” he explains. “If you’re not paying attention, if you’re not plugged in, over the course of one, two or three months, you’re going to be wondering where all the business went.”
Social media generates qualified leads. In its annual “Social Media Marketing Industry Report,” Social Media Examiner, a webzine that examines trends in social media use, reported about half of all respondents (52%) obtained qualified leads from their social media marketing efforts. The same study revealed that 48% of respondents said their use of social media reduced overall business marketing expenses. In 2009, that figure stood at 35%.
The places to engage customers are changing. Current and potential customers don’t just “friend” and “Tweet.” Borrell and Social Media Examiner cite social media marketers’ 2010 plans to deploy a mix of tools and channels (including LinkedIn), forums, Digg, Reddit, Mixx, StumbleUpon, YouTube, Blogs and more. Determining where to spend media dollars, even just within the social network space, has therefore become a highly complex proposition, says Borrell.
“Companies can’t buy one or two media today, like direct mail or a newspaper ad or a radio commercial and expect that’s going to continue to work for them,” he says.