Marketing executives expect to spend more than ever on social media, but many remain unsure how to demonstrate its impact on their businesses, according to a new study out of Duke University in North Carolina. Does that sound like a solid rationale for further investment, or is it simply that perception is reality? (Here’s the video summary.)
Based on the volumes of activity surrounding social media marketing in the hotel business, I was equally surprised to read in this study that the 351 top marketing execs surveyed also continue to find it difficult to integrate social media activities into the rest of their marketing strategies. Another head-scratcher.
Duke researchers say the survey, started in August 2008, is conducted biannually and is the longest-running survey dedicated to understanding the field of marketing.
Results show social media spending is currently 9% of marketing budgets and is expected to increase to more than 13% in the next year. In five years, marketers expect to spend more than 21% of their budgets on social media. Again, this suggests a lot of faith in a practice where they can’t more effectively demonstrate ROI.
“These spending patterns reflect the sizeable opportunity marketers perceive on the Internet, and they are right, as companies have experienced a 25% increase in sales through the Internet in the last year, from 8.9% to 11.3% of sales,” said Duke University Fuqua School of Business Professor Christine Moorman, director of The CMO Survey. “However, only about 15% of marketers believe they can show the impact of social media on their businesses using quantitative approaches — an important prerequisite for marketers to get their ‘seat at the table.’”
Survey results show even though companies are spending more on social media, that doesn’t necessarily translate into more people working in the area. In fact, CMOs reported an average of three in-house social media employees, down slightly from earlier this year. Findings show CMOs use an average of two people from outside companies for social media needs.
Moorman suggests companies are likely spending their budgets on technology and infrastructure to support social media to measure their activities with greater precision.
At the same time, social media strategies remain only modestly connected to the rest of the firm’s marketing strategy. That task will require leadership and organizational structure to bring these aspects of marketing together, Moorman said.
“If the same customer is being reached on and off the web with the same offerings and same brand, companies must ensure a high level of consistency between these efforts,” she said. “If not, customers will remain unconvinced how the company can meet their needs.”
Sounds like business has a ways to go to marry its overall marketing strategy with its social media practices. Why such a disconnect?