Doubts remain for social ROI

22 March 2011

LONDON: Most major marketers will boost their social media investment this year, but many remain unconvinced about the business results of such activity.

Research firms Millward Brown and Dynamic Logic partnered with trade body the World Federation of Advertisers to understand the role fan pages play in building brands.

The study was based on interviews with 24 digital marketing executives representing multinational corporations, supplemented by a survey of 3,687 following 24 companies on Web 2.0 platforms.

Primarily, the report considered global, American and European pages, covering the confectionery, alcoholic and non-alcoholic drinks, personal care and telecoms categories.

Some 96% of communications specialists anticipated dedicating more time and resources to social media during the coming 12 months.

This strategy has assumed pivotal importance even though 50% of the professional panel proved "unsure" regarding the likely return on investment which might be delivered from these initiatives.

Such a figure compared with another 23% believing the payback would be "good", 18% predicting an "average" result, and 9% placing this rating at "poor".

When assessing the value of fan pages, 85% of marketers asserted they acted as a potential source of insight and may increase customer loyalty, and 80% hoped enhanced word of mouth could emerge.

Exactly 75% referenced deeper engagement levels, and 50% thought they constituted a "visible sign" of product popularity.

A further 45% argued long-term customer spend should rise as a consequence of these efforts, and 15% forecast a short term lift on this metric.

Thus far, measurement has focused on fostering an audience, largely because of the need to establish a meaningful fanbase.

Web analytics and buzz monitoring have witnessed the strongest uptake, with in-depth attitudinal analysis somewhat of a rarity at present.

The consumer poll asked respondents to identify the best attributes, content and benefits they derived from following a brand.

This index score showed overall perceptions, repeat visits, advocacy and the attention commanded by brand posts in a netizen's news feed.

It revealed a 0.28 correlation between the amount of fans a page has and its performance, but equally noted that relatively small offerings often yielded above-average numbers.

Video, competitions, new product information, photos and conversations are the formats which typically stimulate interest among web users.

Elsewhere, companies updating pages with the greatest frequency generally achieved better totals and boasted the liveliest communities, while providing "fun", "variety", "innovation" and "interactivity" is also effective.

Duncan Southgate, Millward Brown's global innovation director, said: "Fan expectation of brands in the social media space is increasing all the time."

He added: "Marketers that don't regularly add new and interesting content to their fan pages and embrace what their fans want from the page are missing out on an opportunity to build loyalty among some of their most important consumers."

The report suggested these learnings must be combined with existing published and in-house findings concerning recruiting, retaining and valuing fans, and be aligned to specific key performance indicators.

Data sourced from World Federation of Advertisers; additional content by Warc staff