- July 30, 2010
- 176 Comments
The spirit of social media is enlivening industries, refreshing marketing, and humanizing businesses. While the steps to the social revolution are gradual, so are the budgets that fund innovation. Progress is underway however, and with every experiment and pilot program, we learn the answers to the questions that serve as the gateways to change.
Early experiments are sparked within various forward-looking divisions and funded by other resident or surrounding programs or departments. As social media permeates and socializes the frameworks of the modern businesses, finances and supporting resources will shift to advance expansion.
A recent study conducted by Duke University and the American Marketing Association documented the rise of hiring, budgets, and social media spend over next year.
According to the 2010 CMO Survey, on average, CMOs expect to increase marketing budgets by 5.9% citing social media as a crucial slice of the Internet marketing mix.
Business Growth Strategies
CMOs are optimistic about the future of the U.S. economy and many are focusing efforts on proactively increasing customers, purchases and improving their abilities to retain current customers.
Over the next year, growth strategies reflect a focus on market expansion and depth.
Market penetration (introducing current products and services to current markets): 44%
Product and service development (creating and introducing new products and services to current markets): 26%
Market development (adapting current products and services to new markets): 18%
Diversification (new products/services to new markets): 13%
Digital Marketing Leads the Way
With a 5.9% average increase in marketing budgets, Internet marketing is the beneficiary of overall budget with 12.2%; social and traditional CRM accounts for 9.9%; the introduction of new products checks in at 6.9%. Traditional advertising on the other hand is estimated to fall 2.5%.
In reviewing the results from the study, it appears that B2B products and services companies are mapping out among the largest expansions in marketing spend over the next year at 8 and 7.7% respectively. When comparing B2B to B2C products and services companies however, B2C trails 2.1% and 1.6% respectively.
Branding plays a pivotal role in B2B marketing over the next 12 months, increasing spending by 11.8% compared to only 4.3 across other sectors. The socialization and modernization of CRM is also pivotal to B2B growth, representing a 16.6% rise compared to 7.5% across all other sectors.
Social Media offers tremendous growth potential and as such, budgets are multiplying. As reported in the research, social media budgets will spring from 5.6% to 9.9% this year. However, over the next five years, social media budgets will swell to 17.7% of the total marketing spend.
Comparing and Contrasting Social Media Spend: B2B an B2C
Continuing the trend in aggressive expansion, B2B companies plan the greatest increase in social media spending this year, jumping to 11% from 6.5% last year. B2C services trails, however social media spending continues to bloom from 2.9% to 6.9%. When we look at B2C product company forecasts for social media, we’re presented with a much different picture. Social media spending is expected to jump from 7.5% to 11.6% within the next year and upwards of 19% over the next five years. In comparison, B2B product and B2B services will scale to 15.3% and 18.9% respectively.
Visualizing Hybrid Theory
Recently, I discussed how social media was influencing not only the evolution of business, but also how the roles and skill sets of individuals within each socialized department would also develop in order to pave the roads to the future. I call this idea Hybrid Theory and it represents the fusion of best of breed expertise into varying social roles.
The study highlights how nearly one-half of companies expect to hire new media marketers over the six months and 61.4% and 77.5% will fill new marketing roles over the next year and two years respectively. Most notably, only 27% are expected to look at university graduates.
Experience counts for everything…
The most sought-after skill sets now and in the immediate future, include Internet marketing, innovation and growth, social CRM, and brand management. If we look at Hybrid Theory, those individuals who possess an understanding and a sliding scale of experience of all of the above can create their own destiny.
Executive-level marketers were asked to share their opinions on which brands currently set the standard for excellence. The results include Apple, Procter & Gamble, and The Coca-Cola Co. Honorable mentions were given to Google, General Electric, Nike, and McDonald’s. In social media, I would also add Starbucks, JetBlue, Dell, Virgin America, ebay, Cisco, among many others.
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