Social media marketing represents the newest—and perhaps most potent—way to advertise. After all, most Americans are active and eager social media users; and a majority of them responded positively when asked if they wanted companies to use social media sites. For that matter, Cone Research reports that 4 out of 5 consumers have changed their minds about a purchase–after reading negative information online.
All indications are that social media is a great advertising investment; in fact, it’s old news by now. So it’s been difficult to understand the reluctance of many major U.S. companies to join in the fun. Now a new survey indicates that U.S. corporations are (finally!) becoming aware of the value of social media marketing.
The CMO Survey is a bi-annual survey of 249 chief marketing officers in the U.S. The latest report, released in August, shows that U.S. companies plan to raise their spending on social media advertising, increasing their investment from the current figure of 7.1% of total marketing expenses to 10.1%.
The business-to-consumer sector will increase its commitment to social media even more. Within the next five years, spending in this quarter will increase from its current 10.5% to 24% of total market budget.
The new survey doesn’t indicate that companies are comfortable with social media marketing yet, though; in fact, just the opposite. The survey asks companies how much they had integrated social media into their marketing strategy, using a scale from 1 to 7 with 1 labeled “not integrated at all”, and 7 labeled “very integrated”. The responses were telling: only 12.8% chose the highest score. In a similar study by Marketing Sherpa, 31% of respondents reported that social media was only integrated into companies’ strategy to a limited extent.
This indicates that many companies continue to be uncomfortable with social media marketing. Reasons for their hesitation probably include an emotional investment to the old advertising model, where advertising was something a company did to consumers, who were passive receptacles. This model is losing its effectiveness; it gives companies complete control over their message, though, and it’s always hard to let go of power.
But companies are starting to edge into social media in spite of their fears. Trying new techniques is always risky, but in this case, it’s sure to pay off.
