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March 16, 2009

Recession resistant: 95% of social media marketers will maintain or increase social media spending

by Josh Bernoff

Last year, we surveyed interactive marketers and found a strong desire to continue investing in social applications, even with a recession looming. Now the recession is here. What are they saying now?

Based on a more recent survey from December of 2008, they still will maintain or increase their social media investments. The full statistics are in a new report by my colleague Jeremiah Owyang called "Social Media Playtime Is Over." Remember, in late '08 the recession was nearly as gloomy as how it looks now. And yet:

Playtime_is_over_3 1. More than half of interactive marketers plan increases in their social technology spending. (These stats are from 114 marketers currently using social media, out of the 145 interactive marketers we surveyed.) Only 5% plan decreases. Go ahead, name another marketing investment that's anywhere near this strong in recessionary times.

2. The most rapidly growing categories are social networking, blogging, and user-generated content.

3. Remember that the base of this growth is small. While the marketers in this sample all come from companies with at least 250 people, three quarters of them are still spending $100,000 or less on these social technology projects. This is a drop in the bucket compared to other marketing expenditures.

This has reinforced what I'm hearing out there anecdotally, which is an awful lot of marketers asking for (and paying for) advice on this topic.

What's driving this? As the executive summary of the report says:

These inexpensive tools can quickly get marketing messages out through interactive discussion and rapid word of mouth, and properly managed, can deliver measurable results.

The report includes recommendations for marketers. Here are some for my blog readers:

  • If you are a marketer interested in social media, use these stats to get a realistic budget, then concentrate on measuring the results of your efforts to prove they work. Don't dabble; dabblers will see their budgets cut. Social media playtime is over.
  • If you are a consultant or recently laid off person, yes, this is a growth area. But it is one in which there are already an awful lot of experts. To become successful, concentrate on developing expertise in implementation, management, moderation, or measurement of social media efforts; that's where the need appears to be, from the companies I speak with. In other words, social media playtime is over.
  • If you are a technology vendor, case studies with proof of value will be far more effective than features, functions, and technology claims. If you can offer a consultative sale and handholding service, you'll be a lot more likely to win clients and thrive in this space. Say it with me, now. Social media playtime is over.

Got it? What do you think? Is the recession halting social media efforts at your company, or encouraging them?

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Comments

MBB

Josh, I think this is really interesting but my big concern is that marketeers (at least in the UK) are still being mislead about social media. This mainly comes from "Social Media Agencies" who don't seem to have the experience of traditional media agencies and their digital better-halfs. Therefore, social media is still often considered its own entity when in fact it should be part of the media mix e.g. upweighting conversations/activity during peaks of TVRs just as you should with search.

I may be wrong on the above, but from my point of view its great that marketeers are making that commitment to social media. But is this because they have been led to believe its all free? : )

Josh Bernoff

@MBB No, the people we work with and who take our surveys have real budgets, they don't do this for free.

In fact, I think we are growing towards a world where social applications ARE part of the media mix. That's how Hershey's did it with House Party, for example.

MBB

Josh. Agreed, but I am very much talking from a UK perspective as well. I don't think that brands here are as advanced in social media and thus there are areas of weakness about how its integrated.

Do you think that social applications are living up to your original audio post on Marketing Voices? And how do you think - "planning to increase spend" translates to actually increasing spend?

social media marketing

An increase in social media marketing is a definite great move in a bad economy. It's just one of the most cost effective marketing strategies. A viral application on a social network is the gift that keeps on giving. You pay for development once and it spreads for free after launched.

seo recession

It is very obvious according to many statics that, in this period of recession Social networking and especially SEO is very greatly in demand.

Eli S. | Vertical Measures

For us, Social Media is a booming business and will seemingly become our flagship service at some point. While I don't think social media will ever completely eclipse our core link building business, there's no doubt that it's the wave of the future, especially when a client is willing to go all the way and participate in their own campaigns

Rebekah Donaldson

Great piece. And a good thread above.

The recession is encouraging SM efforts at our company. And I’m very wary of that.

When we heed Josh’s call to get in or get out of the business of guiding corporate strategy for dealing with social technologies like blogs, social networks, and wikis, we’ve got to be dispassionate about whether we can really move the needle at clients' businesses by adding integrated SM efforts. In fact, we probably need to be pessimistic.

Josh’s first bullet tells how 114 out of 145 marketers currently using social media, are planning to increase their social technology spending.

What’s driving this is the belief that, “these inexpensive tools can quickly get marketing messages out through interactive discussion and rapid word of mouth, and properly managed, can deliver measurable results.”

But people’s self-reporting about the success or the effectiveness of X in their own experience is hella unreliable.

Take any chart showing the results of asking marketers “are you happy about adding ____ to your marketing efforts?" and it’s likely you'll get a towering “yes” column. It’s like asking people who just forked over big bucks to put their kid in a private school whether or not they think it was a good idea? Yes sir. Vigorous nodding. If we're not vigorously nodding, we may feel the chill of uncertainty.

EH

For our company, social media has become an area in which we are expanding our efforts. We are constantly working on improving SM not only for our own company, but also for our clients.

Submitter

I was an university student until some months ago. I took a class called Social media.

I have risen the social media marketers issue in class and to my amazement I was asked why do I search for means of advertising, money making in social media?

I was told that social media should be kept ad-free at least in theory and we should focus on the networks, the connections being made.

Does this mean that we were taught this to become someone else's tool?

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