One of the challenges that social media has faced over the last year or so is showing the kind of positive ROI that will draw companies to invest more in social media marketing.
Well research from social media platform Wetpaint and digital consulting firm Altimeter Group found that companies with the highest levels of social media activity on average increased revenues by 18% in the last 12 months, while the least active saw sales drop 6% over that period.
The study reviewed more than 10 social media channels, including blogs, Facebook, Twitter, wikis, and discussion forums for each of the 100 most valuable brands. Activity in each channel was ranked for depth of interaction on measures that corresponded to that specific channel. Scores for overall brand engagement ranged from a high of 127 to a low of 1. The top 10 brands with their scores are:
- Starbucks (127)
- Dell (123)
- eBay (115)
- Google (105)
- Microsoft (103)
- Thomson Reuters (101)
- Nike (100)
- Amazon (88)
- SAP (86)
- Tie – Yahoo!/Intel (85)
Qualities of Success
Companies that scored well in the study generally have dedicated teams, however small, active in the social media channels they utilize. The study found that the most successful teams evangelize social media across the entire organization to pull in a broad range of stakeholders. These companies view social media as an indispensable tool to help them achieve results, and their approach is conversational. This mode of operation differs from the approach of traditional communications and early corporate blog experimentation, which emphasizes messaging and talking points.
“This is the first study of this depth on the top global brands and we think the results provide a good guide for corporations and brand marketers in every industry,” said Charlene Li, Founder, Altimeter Group. “The success stories we have uncovered provide a blueprint for companies making decisions about how to best apply their marketing and consumer relations resources.”
“The study goes a long way towards validating the importance of social media for business,” said Ben Elowitz, CEO of Wetpaint. “The closer any company is to its customers, the better, and it’s hard to argue with the ability for social media to create such proximity. In this day and age, companies should feel much more comfortable investing in social media — the correlation to results is so clear.”
Four Quadrants of Engagement
While each company in the study received a quantitative score, the study revealed that companies fell into four specific categories in terms of their breadth and depth of investment in social media channels — Mavens, Butterflies, Selectives, and Wallflowers.
- Mavens — brands that have made social media a core part of their go-to-market strategies and are very active in many channels; usually driven by dedicated teams assisted by company-wide awareness and participation.
- Butterflies — brands that recognize the need to be in many channels but have only met with real success in a subset of their activities; these companies are usually spread a bit too thin.
- Selectives — brands that focus on just a few channels and excel in those; these efforts are usually initiated by an internal evangelist.
- Wallflowers — brands present in only a few channels and very lightly in those; these brands are sitting on the sidelines and are wary of the risks. They are still trying to figure out the best next steps and investments in social media.
Among industries, media and technology companies tend to be “mavens” while financial, food and beverage, consumer products and apparel brands were on the other end of the spectrum — “which is expected given that companies in these industries are just beginning to experiment with social media,” the report states.
Starbucks was the obvious exception in the food and beverage industry, beating out advanced media and tech brands. Among its most prominent social media efforts was last year’s launch of MyStarbucksidea.com, a community site allowing users to submit, comment on, and vote on their favorite ideas for improving the company.
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Overall, the article is straight forward and it makes obvious sense that there are (still) a fair amount of marketers skeptical about Social Media as a marketing-communications approach. However, the one thing I disagree with is the way in which the study based its result.
It says here that:
“The study reviewed … forums for each of the 100 most valuable brands…”
And then it says:
“Among industries, media and technology companies tend to be “mavens” while financial, food and beverage, consumer products and apparel brands were on the other end of the spectrum…”
I don’t think it is, solely, because brands within these industries are just getting started. The meaning of a “valuable brand”, to me, is rather subjective. If by value you mean the so-called brand awareness, then I guess yeah, we can deal with Starbucks, Nike, etc…And of course those brands within the “food and beverage” industry can’t be consider “mavens” to the scale of the monsters previously mentioned. The reason why the “food and beverages” brands were not consider mavens, is because their relationship seems to be much more organic and even more real. here (http://tinyurl.com/mcbh9u) they talk about small businesses taking advantage of social media, giving their brand a great value (a personal one – which is, at the end of the day, what marketers want in social media). I actually think the deeper problem being overlooked is that the “valuable brands” need to rethink their concept of “value,” and look at the “selective” ones and what they’re doing. Just because valuable brands have thousands of followers, friends and are all over the social media universe; doesn’t mean that selective, food and beverage brands, in a community of twenty thousand people and four thousand followers (20%) is not considered maven and/or less successful. It is not because they’re just getting started, it’s just ‘cus their names are “Corner Shop” or “Crepes down the road”.
Or maybe is the concept of “maven” that needs revision? In any case, now that it has been established that Social Media is here to stay, we need to start thinking smaller and smaller….On terms of execution.
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