The latest edition of the CMO Survey from Duke University’s Fuqua School of Business had good news and bad news where social media is concerned. The poll of 288 chief marketing officers across the U.S. showed they realize the importance of social media, and plan to boost their spending on it accordingly -- but at the same time are still mostly lost when it comes to demonstrating its impact on sales.
On average, the CMOs surveyed said they plan to increase their spending on digital marketing in general by 14.7% over the next year, compared to a 1.1% decrease in traditional advertising spending. Meanwhile, they plan to raise social media’s share of total marketing spending from 9.9% currently to 13.5% in the next twelve months, and 22.4% five years from now. Currently, 18.9% of social media activities are performed by outside agencies, up from 17.5% last year.
Now for the “less positive” findings: asked how effectively they believe social media is linked to their firm’s marketing strategy, 59.5% of respondents were neutral or negative, while just 40.5% believed it is linked very or somewhat effectively. Similarly, 45% said they haven’t been able to show social media’s impact on their companies’ performance at all, and another 41.8% said they have a qualitative sense but no quantitative impact. A mere 13.2% believe they have proved the impact quantitatively.
Furthermore, 63% were either neutral or believe their company is generally ineffective at integrating customer information across purchasing, communication, and social media channels; at the other end of the spectrum only 3.2% said they believe their company does this “very effectively.”
These failures are especially significant in view of the growing demands for accountability from the corporate powers that be. On that note, 57.9% of CMOs surveyed said they feel increasing pressure from CEOs or the board of directors to prove the value of marketing; not a single one said they felt decreasing pressure. Perhaps not coincidentally, CMOs also plan to boost spending on marketing analytics from 6.4% of total marketing budgets currently to 11.7% three years from now.
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They might as well worry about the ROI on their building's sign or the list of their number in directories. What's the ROI on community events and sponsorships? What's the ROI on anything that you do to match the efforts of your close competitors?