Social media is an effective marketing and advertising channel, according to 329 brand executives surveyed by PulsePoint Group and the Economist Intelligence Unit for eMarketer in February of this year -- but they’re not sure exactly how effective it is, as they still don’t have a handle on social media metrics.
The good news: large majorities of respondents agreed that social media was effective in basic and important ways. Overall 84% of respondents said that social media improved their marketing and sales effectiveness, 81% said it resulted in increased market share, 68% said it resulted in improved product or service quality, and 69% said they had observed a spike in sales when customers started talking about brands positively on social media.
Now for the bad news: social media metrics are still wanting, if not entirely absent. True, at a broad level, PulsePoint and the Economist Intelligence Unit were able to calculate that companies with a high level of social engagement enjoyed an ROI almost four times higher than companies with no social media present (7.7% versus 1.9%). But when it comes to specific campaigns, on behalf of individual companies, measurement is still a guessing game. Thus half of the survey respondents said lack of standardized metrics for ROI was a big impediment for social media campaigns.
In March I wrote about “Marketing ROI in the Era of Big Data,” a study presented by Columbia University Business School professors and the New York American Marketing Association, which found that most advertisers and marketers are failing to exploit “Big Data,” including the wealth of information about consumer habits and preferences flowing from social media.
This survey of 283 corporate marketing decision makers, conducted by Research Now, found 39% said their own company’s data is collected too infrequently or not real-time enough. Meanwhile 51% said that a lack of sharing customer data within their own organization is a barrier to effectively measuring their marketing ROI. 37% of respondents did not include any mention of financial outcomes when asked to define what “marketing ROI” meant for their own organization, with 22% using brand awareness as their sole measure when evaluating their marketing spending.