Australian businesses becoming more social
Australian businesses are becoming significantly more social
More than ever Australian businesses are allocating additional funds to social media and are now using it as a way to build customer relationships rather than simply a marketing tool.
The Nielsen-Community Engine 2011 Social Media Business Benchmarking Study found 72 percent of businesses in 2010 participating in social media allocated 10 percent, or more, of their marketing budget to it. This is an increase from 57 percent of businesses in 2009.
The Australian study, commissioned by social business software and community engagement solutions company Community Engine and run by research company Nielsen, investigates how businesses use, measure and budget for social media.
One of the major shifts this year was organisations increasing marketing budgets as opposed to last year when they reallocated it from traditional media. This year 44 percent of participating businesses expanded their marketing budgets to fund a social media strategy.
The greatest proportion of businesses, 40 percent, allocated the most of their social media budget to display advertising or maintaining a presence on Facebook, which is the most popular social network platform with one in four Australian businesses having a Facebook presence.
Community Engine Director of Social Stephen Johnson said, “Attitudes are changing towards social media with more businesses embracing it and becoming more knowledgeable about online platforms. A shift from last year now shows only 35 percent of businesses lack knowledge and expertise to implement social media activities, down from 53 percent in 2009.”
“A significant proportion of businesses want control control of the online platforms with one in five saying they would much prefer to create their own social network than to utilise external social networks.”
The barriers relating to ROI and establishing KPIs have declined significantly. The benefits of a social media strategy are now being acknowledged by more businesses with only 16 percent of businesses finding it difficult to measure the ROI of social media activities, down from 28 percent in 2009.
What are they using it for?
Businesses have significantly changed what they use social media for. This year, businesses have shifted from using social media for branding to customer relationships. 43 percent see social media as a way to build a relationship with customers and stakeholders, with 33 percent for branding, a significant drop from 61 percent in 2009.
Mr Johnson said businesses had developed a deeper understanding and appreciation for the true power of social media. “At the end of the day social media is about engagement. Through social media businesses can create an emotive link with consumers and build a two-way relationship with them in a way they have never been able to do before.”
Nielsen research director Melanie Ingrey said it is reassuring to see that an increasing number of businesses are taking a considered approach to social media, creating dedicated budgets to fund these activities and feeling far more confident in their knowledge and expertise in the area. This points toward creating a thoughtful, valuable and meaningful experience and interaction with customers, which is a positive overall.
With Australian businesses the most popular social media activities included:
- Presence in social media networks: 28 percent.
- Tracking/monitoring what is said about your brand/organisation/staff: 26 percent.
- Responding to/acting on comments: 25 percent.
Who is leading the charge?
Private companies have more confidence when it comes to a social media strategy and 51 percent of public sector feels their organisation lacks the knowledge and expertise to implement social media activities.
But the public sector have come out on top as more active in facilitating discussion and interaction with 56 percent giving the audience the opportunity to ask questions within a social networking platform.
Also leading the way is large businesses which are participating more than SMEs (less than 100 employees) in social media networks, 35 percent of large organisations have a social networking presence, as opposed to 22 percent of SMEs. Of this group 40 percent of large businesses are tracking/monitoring what is said compared with only 16 percent of SMEs.
Large businesses are also putting more money behind it with 30 percent using online display advertising on social networking sites compared to 14 percent of SMEs.
“This is not a surprising statistic to come out of the study as large businesses will generally have a bigger budget to work with, but sometimes having the right strategy can be just as effective. Social networking can work for all kind of businesses – if they know what they are doing,” Mr Johnson said.
This is the second year the survey has run and within 12 months it has already shown a marked change in the way businesses view social media as a business platform and how and why they are going about it.