By Rob Swystun, Pristine Advisers
As a growing number of companies continue (or finally start to) engage customers and investors on social media sites, companies are also starting to get savvier about how they do it.
No longer satisfied just to have representation on social media sites, companies have learned what works and what doesn’t and have started to really take notice of the sites that are working for them and ramping up their efforts on those sites and also what sites do not work for them and minimizing their efforts or dropping certain sites altogether.
Not surprisingly, overall use of social media continues to climb among fast-growing companies according to an annual study done by the Center for Marketing Research at the University of Massachusetts Dartmouth.
This study, done each year since 2007, tracks social media usage of the Inc. 500 (the 500 fastest-growing private U.S. companies according to Inc. Magazine). Thirty-four percent (170) of the Inc. 500 participated in the study that covers 2012, which makes the research statistically valid at +/- 6%. Interviews were conducted with the highest-ranking Marketing or Communications executive at each company and in many cases, the company CEO or CMO provided the information.
Up & down
The study released earlier this year, which reflects trends in 2012, found that LinkedIn lead the way among social media platforms for the Inc. 500 with 81% of the companies polled using it. Twitter also gained users among the Inc. 500 while former social media darling Facebook saw its usage drop by 7% in the past year compared to 2011.
Foursquare and Pinterest are also showing up on the scene, with 28% and 18% usage among the Inc. 500 respectively.
Facebook has long been useful for businesses looking to connect with consumers via contests and sharing their experiences with company products or sharing anecdotes about the company. However, Facebook has also gained a reputation as a bit of a frivolous time-waster and, therefore, isn’t where most people go to get news or information on a company. Most people, and this is probably especially true for current and potential investors, don’t associate Facebook with business.
LinkedIn, however, is more business specific and people usually visit a company’s profile on LinkedIn for business or networking purposes as opposed to approaching it from a consumer perspective. LinkedIn itself has contributed to this rise by overhauling how corporate profiles are presented and what communications options they now have.
Corporate blogs have regained some of their former glory. Back in 2007 was the glory days for corporate blogs, but then social media sites like Facebook and Twitter took over as the go to sites for companies looking to engage with people online.
However, usage of corporate blogs has increased by 7% in 2012 among the Inc. 500, with 44% of companies using their own blog to communicate with customers and potential investors compared to just 37% in 2011.
The big draw for a company using its own blog is that there are no restrictions on the blog so you can really use it to craft a personalized and consistent corporate message to the people you’re communicating with. And you can make it as interactive as you choose.
Enough is enough
It seems that the hot and heavy love affair that the Inc. 500 have had with social media is now cooling off a bit and turning into a more cozy relationship. In 2011, 71% of Inc. 500 companies planned to increased their investment in social media but that number dropped dramatically for 2012 with only 44% planning to increase spending on social media. Forty-one percent plan on keeping their spending on social media at the same level, while another 15% were unsure how their social media spending would change.
The drop in companies that are willing to increase spending in social media is likely due to the fact that the big players in social media in general have been established now for a few years and unless there is some major new social media website on the horizon, companies are by now familiar with what works and what doesn’t and will continue to concentrate their efforts on what has worked for them so far.
Companies, in a head-scratchingly bizarre statistic, appeared to be monitoring the internet less (yes, you read that correctly) this past year than previous years. Back in 2010, the amount of companies making serious efforts to monitor online conversations about their names, products or brands was at 70%. In 2011 that had dropped to only 68% of the companies queried and for 2012, that number declined again to just 63%.
This slow drop in online monitoring can be chalked up to … business people thinking this whole internet thing is just a phase? Okay, maybe not, but your guess is as good as anyone’s. Why any company would decide to monitor the webosphere less for mentions of their company is not something that you can stew about for too long lest the lack of common sense causes an aneurism. In these companies‘ defense, though, who really has the seconds to spare that it takes to set up a Google alert or check Twitter hash tags?
The bottom line
Social media wouldn’t be worth it at all unless it helps the bottom line of the company, right? Fortunately, about one third of the Inc. 500 businesses reported the ability to determine the return on investment of their social media adventures. Out of that one third, 19% reported that they had been able to cut costs in their recruiting efforts due to their social media investments.
This ability to save on recruiting efforts could very well be tied to the increase in the use of LinkedIn referenced earlier, as the business-first social media site has become famous for its ability to assist professional recruitment efforts.
The Center for Marketing Research’s social media study also found that 63% of companies in the Inc. 500 have social media content that comes straight from the CEO (no mention of whether it actually comes from the CEOs or if it just has their names on it).
This is big because even if it’s on a website, people still want to see or hear from the company’s CEO or at least get the impression that they are hearing from the CEO or some other important member of senior management.
Although there is ample evidence as to the importance of social media for companies looking to communicate more with customers and investors and more companies are using it, companies are divided on whether it is a central tool to their growth. Sixty-two percent of companies feel that incorporating social media tools into their communications strategy has been necessary for the growth of the company. However, 39% do not believe these tools are central to the company’s growth.
Which side a company falls on probably has a lot to do with what the company does.
Social media expert?
It might not pay as much as people had hoped to slap the moniker of “social media expert” on their business cards (and is there any merit in declaring yourself to be an expert on platforms that the below-average 12 year old can master?), as only 9% of those polled said they had specifically hired someone to handle social media duties. An additional 9% hired an outside consultant or content provider for social media needs.
Sixty-five percent (which you will recognize as being the vast majority), eschewed hiring new people in favor of simply giving the social media responsibilities to existing employees, often in the marketing department.
Plan … B? C?
In another head scratcher of a finding, the study uncovered that a full 22% of the Inc. 500 respondents don’t have any social media plan nor do they have it incorporated into any other type of communications plan. Twelve percent, on the other hand, have a standalone social media plan while the majority have social media functions incorporated into their marketing or business plans.
So abandon your corporate Facebook account, ramp up your efforts on LinkedIn and hire a “social media expert” to handle all of it. … Or better yet, sit down with your marketing department and formulate a plan. (Marketing people love that sort of stuff, y’know.)