NEW YORK: Over 90% of major brand owners are now using social media, but this channel primarily remains a marketing medium rather than yielding tangible revenues, a study has found.
Booz & Co, the consultancy, and Buddy Media, the software provider, surveyed executives from 100 companies, more than 60% of which boasted an annual turnover surpassing $1bn.
In all, 94% of firms listed Facebook among their top three social priorities, with Twitter on 77% and YouTube logging 42%. Blogs and branded platforms scored 25% each, LinkedIn posted 13% and location-based tools like Foursquare received 8%.
The average organisation utilises 4.6 such properties at present. Marketing departments helped head up such activity for 81% of corporations, with digital teams on 62%, PR units on 48% and customer service groups on 26%.
Some 94% of the panel thought adapting and reacting quickly was essential to social media success. Having an internal "owner" and "champion" for this medium recorded 93%, while leadership support and in-house education hit 90%.
Advertising and promotions are currently the main use for sites like Facebook and Twitter, on 96%, ahead of the 88% using them for PR, 75% for customer service and 56% for market research.
Commercial objectives are still more limited in scope, as just 40% of companies employ social media for sales purposes, and a further 46% think they deliver purchases and meaningful leads.
By contrast, 90% of interviewees mentioned benefits tied to brand building, 88% agreed they stimulated buzz, 81% referenced securing consumer insights and 78% cited enhanced marketing effectiveness.
A majority of enterprises also already possess dashboards, partnerships with specialist agencies and a clear, integrated social media strategy. However, only 38% of respondents stated their CEOs had this issue on his or her personal agenda.
When it comes to measurement, 38% of firms tracked transaction data, versus over 80% for monitoring advocacy, participation, engagement and reach. More positively, 44% of the sample expected to have revenue-generating platforms linked to social media in two years time.
Similarly, while 67% of businesses allocate less than 5% of digital marketing budgets to social channels today, a 55% share believe the proportion of new media spending directed to this route will be at least 10% three years into the future.
Christopher Vollmer, of Booz & Co's media and entertainment practice, said: "Leading companies are recognizing they need to shift their focus from campaigns to capabilities, and in doing so they are actively transforming their model for marketing from one of 'brand management' to 'brand curation."
Data sourced from Booz & Co; additional content by Warc staff