Social Media Set to Capture Large Percentage of Marketing Budgets
Earlier this week, I highlighted some of the general trends marketers predicted for the next year and that included more direct selling to consumers and a higher percentage of the advertising budget being moved to the digital format. The in-depth CMO Survey also revealed marketer plans for social media. In both the short term and long term, spending on social media will increase.
The typical enterprise now allocates 7.1% of the total marketing budget to social media. Within the next 12 months, that figure will rise to 10.1%. And in 5 years, enterprises expect to spend 17.5% of their marketing budgets on social media. The survey did point to big differences in social media budget allocations based on business type. In 2012, enterprises say they’ll spend the following on this media format:
B2B Product 7.0%
B2B Services 11.5%
B2C Product 13.6%
B2C Services 9.4%
Business and marketing leaders know that effective integration of any process can lead to efficiency and profitability. But for the most part, these leaders are struggling with the best way to integrate social media into their marketing strategy. For now, only 12.8% say that social media is integrated and another 12.8% say the format is very integrated into their marketing strategy. The numbers are significantly lower when it comes to integrating social media into the firm’s general strategy. Just over 9% say social media is very integrated and another 4.6% say it is integrated. Currently, about 2 people in each organization are assigned to internal social media groups, most frequently, 59.1%, coming from marketing.
The metrics of ROI continue to be a challenge for marketers. This year, the measurement techniques have shifted. Enterprises have been focusing more on page views, online ratings and abandoned shopping carts. These are all easily obtainable metrics. Merchants also note they’ve put less emphasis on financial metrics such as sales levels, revenues per customer and profits per customer. It’s not clear whether this decline is because of the difficulty in determining how to establish a clear relationship between the effort invested in social media and the revenue it yields.
It will be interesting to watch how businesses attempt to measure the results of their social media efforts as this expenditure soars to nearly 18% of the marketing budget over the next 5 years.[Source: Moorman, Christine. Highlights and Insights. The CMOSurvey.org. August 2011. Web. 8 Sept. 2011]
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