Is this what the social media world has been waiting for: a detailed study that equates companies’ social media activity with (gasp!) pounds and pence, dollars and cents?
Well, technology and business analyst, Charlene Li and her digital consulting firm, Altimeter Group, have come up with just that. The study took the top 100 brands according the Business Week index and, first, analysed their engagement across 11 social media channels.
The top 10 list of social media performers contains no surprises – Starbucks, Dell, Google, etc – but it’s the next part of the engagement analysis that should put a spring in the step of social media advocates everywhere and give marketeers with metrics on their mind something to think about.
The study claims that revenues of the most social media-engaged companies – or “Social Media Mavens” as the report has it – rose 18% on average in the past 12 months, compared with an average decline of 6% among the least engaged. Finance people (welcome, if you were looking for the FT and have found yourself at PR Media Blog by accident) take note: the same results were identifed in gross margin and net profit figures.
What’s that you hear? It’s the sound of a few thousand social media experts saying “Phew! We knew we were on to something…”
But not content with showing how it benefits the bottom line, Altimeter’s work goes on to deconstruct how the top performers’ social media efforts are paying off. For those who consider themselves social media literate, this will seem obvious; but companies which refresh content regularly and actually respond to comments left on their blogs (i.e., conversing) are already streets ahead. It’s the difference between saying “we must get some of that social media magic” and actually doing it.
Other useful findings show that effective social media engagement is not the realm of the few in an organisation, but the many. This goes against the traditional marketing communications approach of maintaining a vice-like grip around every utterance from within an organisation and is, without doubt, a hard habit to shake off.
Finally, the study focuses on the importance of companies’ attitude to social media, in that it’s no longer something that can be dismissed as irrelevant to a particular business or business sector or something that be treated as a campaign with a finite life span. Sorry folks, but if you want some of those numbers that make the FD smile, it’s in for a penny, in for a pound.
And in the fine PR tradition of giving catchy names to different modes of behaviour, the study categorises companies from the top flight “Mavens” to the bottom end”Wallflowers”, which are involved in social media, but only just. This tool gives you the chance to rank yourself.
So will you be Maven, Wallflower or something in between? If the study is to be believed – and real, financial fruits can be harvested from social media – then maybe it’s time to stop being (my term) the potted plant, that sits on the shelf waiting to be watered and hoping the sun will shine.