CHICAGO ? The Shopper Technology Institute announced yesterday the results of a national survey conducted on its behalf by Partners in Loyalty Marketing (PILM), showing that consumer packaged goods manufacturers widely use social media, especially Facebook. However, initiatives are often in the early stages and play a supporting role in brand marketing. While social media?s share of budget remains small, it is growing.
Other key results of the survey include:
- Few companies currently offer e-commerce via Facebook, but this could increase by 50% given its assumed potential to drive sales.
- Most survey respondents report that consumers are eager to connect with them via social media, but that enthusiasm depends on their emotional ties to the brand and the value delivered.
- Successful social media campaigns offer consumers tangible rewards (coupons) coupled with the intangible (feeling valued).
?CPG manufacturers see potential in social media for connecting with consumers and creating brand awareness. But there are challenges that need to be addressed in terms of measuring success and determining ROI,? said John Karolefski, executive director of the Shopper Technology Institute.
An online survey was fielded in June 2011 and respondents included 126 marketers of food, beverage, health and beauty care, and general merchandise brands.
Nine of 10 CPG manufacturers (89%) include social media in their marketing plan, says the survey. The most commonly used social media platforms are Facebook and Twitter. Only 11% of those surveyed do not use either one.
The research found that most social media involvement is in the early stages of use and development. Slightly more than half of the respondents (56%) call their use a ?toe in the water,? while about a quarter of them (28%) label social media as playing a ?support role? in marketing.
The social media budget is small, but growing. Two of three survey respondents (66%) report that social media accounts for less than 5% of their marketing budget. But a whopping 76% say that the budget for social media has increased this year compared to 2010. About one of four (23%) report no change, while only 1% saw a decline.
Analysis of survey results shows that measurability of social media effectiveness is challenging, and few marketers can tie social media investments to sales increases. ?To date, metrics are mostly limited to consumer feedback and fan/postings counts,? said Michael Schiff, managing partner of PILM.
In evaluating the success of social media, only 6% of survey respondents rely on qualitative measures, 31% use consumer metrics, and 20% use both. Some 21% look to increases in sales and unit volume, while 22% don?t measure social media at all.
On the qualitative side, 40% of those surveyed are analyzing conversations and gaining insights, while 43% aren?t doing so, but plan to. Seventeen percent aren?t analyzing and don?t have plans to start.
As a result, about half of survey respondents (48%) say social media has only been ?slightly successful? in achieving their business objectives. Only 2% say it has been ?very successful,? while 18% say it has been ?moderately successful.? On the other hand, a third of respondents (32%) say social media has been ?unsuccessful? in helping them achieve their business objectives.
When asked how measureable social media is in terms of ROI, only a quarter of survey respondents said ?highly/moderately.? Some 43% said ?slightly? and 13% said it?s not measureable at all. Nineteen percent didn?t know or had no opinion.
According to write-in comments by survey respondents, lack of success in social media is often due to lack of organization or buy-in, as well as inadequate planning and resources.� Another reason cited is weak metrics that fail to build organizational buy-in.
?The lack of evaluation and weak metrics have implications for future budgets and growth,? said Schiff.
The use of social media for e-commerce is modest, says the survey, but there is much potential. Thirteen percent of respondents are currently using e-commerce on Facebook, but 30% who are not doing so now plan to start. Another 37% of respondents can see the potential of driving sales via e-commerce on Facebook.
The two main reasons why CPG marketers use social media are to ?build brand awareness? (48%) and to ?connect with consumers? (41%). ?Building market share? was cited by only 5% of survey respondents, and ?increase sales? garnered 6%.
A third of CPG marketers (34%) say consumers are ?moderately eager? to connect with them, while only 13% say they are ?very eager.?
According to Schiff, analysis of the write-in comments of survey respondents indicates that successful social media campaigns attract consumers in several ways:
- Making it fun
- Offering coupons
- Being direct and transparent
- Balancing content about company/brand and fans
- Creating special roles for loyal fans
?The challenge for CPG marketers is to build on the enthusiasm of the users of social media,? Schiff said, adding, ?To do this successfully, brands must deliver both tangible and intangible benefits.?
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