Survey: Most CMOs To Boost Social Media Budgets In 2010 (And It Had Better Pay Off)
Nearly two-thirds of chief marketing officers plan to increase social media budgets in the next year, but they are also expecting more in return, according to a new study. The survey of 133 CMOs, conducted by social commerce company Bazaarvoice and the CMO Club, found that nearly three-quarters who didn't attach revenue expectations to social media spending in 2009 will start doing so next year.
"While 2009 may have been a "trial" run for many brands and social media, in 2010, CMOs expect social initiatives to directly impact their bottom lines, without exception," stated the report. As a result, the metrics they track for social campaigns will shift from Web-centric benchmarks like traffic, page views, and "fans," to ones linked more directly to their overall business like conversions and average order value, along with sales.
This year, only 36% of companies tracked the impact of social media on conversions, and only 22% on revenue. But next year, 81% of CMOs expect social media investments to account for 10% of sales.
As it is, quantifying the benefits of social media marketing remains an elusive goal. Roughly half of those surveyed are unsure about their returns on using social tools like Twitter, LinkedIn and industry blogs. That brings to mind the old ad industry truism: "I know half my advertising dollars are wasted...I just don't know which half."
Nevertheless, almost all CMOs expect to rely on user-generated content sources such as Twitter, customer reviews, and pre-sales Q&A to influence product decisions. The biggest jump will be in using Twitter comments to help boost sales, with a 407% increase expected among companies surveyed. (Since Bazaarvoice supplies such reviews and other UGC features to retailer and manufacture sites, the company stands to gain from that trend.)
CMOs participating in the study reflected a cross-section of industries including software/hardware, travel/hospitality, media and publishing, consumer goods, and retail, among others. Annual revenues ranged from $6 to $50 million (25%), $51 to $999 million (42%), and over $1 billion (23%).