A recent Boston Consulting Group article says most Chief Marketing Officers aren’t sure.
Obviously, social media is important/highly efficient and holds the potential for building better relationships with communities of consumers/customers. Traditional marketing (i.e. TV advertising / promotion / PR) historically placed a premium on brand building and transactions, but has declined in importance due to a combination of message clutter, time pressed consumers, fragmentation of media and the growth of people using the internet to research what others are saying about products/companies. Nevertheless, what really concerns me is how “tactical” social media has become in recent years and less “strategic”. It appears almost everyone on the social media provider side keeps looking for the latest tools / technique. If something doesn’t work, they simply abandon the approach and go for another without regard to strategy.
Social media today seems to be just a collection of curation, SEO / SEM, permalinks, long tail key words, meta descriptions, website crawling, and click through conversation rates (to what we don’t know) and more. Moreover, when anyone “disses” social media, most assume it’s just driven by a desire to go back to “good ole days” of traditional TV marketing / brand building and they don’t “get it”. What makes this worse is some digital marketing providers don’t have a clue on how to make social media effective and how it ties to a clients’ business strategy. I recently attended a social media presentation put on by top online agencies and when asked how they know if digital marketing drives clients’ sales and builds brands the response was: “I don’t know, but you just need to invest in it since it’s the right thing to do”. No wonder, most CMO’s struggle with social media. I think most want to use it, but don’t know how to bridge traditional TV marketing vs. the new world of digital marketing. They also aren’t getting a whole lot of help from digital providers.
To put all this in a fact-based driven perspective, a recent BCG article below was published in January of this year. It was based on a survey among CMO in global fortune 500 companies. The link is attached below:
Below is a summary I gleaned from this article. I’m sure you will have your own if you read it and it’s a good read anyway.
* Most companies do recognize the need to adopt new ways to reach consumers and build better relationships (i.e. websites, Facebook, Twitter, YouTube, mobile marketing, etc.). It can be very efficient, free / cheap, and can easily measure traffic / activity (read efficiency).
* However, some companies are still just experimenting with digital marketing; while others have developed an infrastructure that can share data with relevant internal business groups. These companies usually spend >20% of their budgets on social media.
* Roughly ¾ of all marketing executives in global Fortune 500 companies are still unsure where to best reach consumers via these new mediums. Moreover, 90% feel they don’t have the right metrics that can tie into business objectives.
* Marketers seem to think consumers want information or product reviews from websites. But consumers want marketers to give more discounts and/or access to purchasing products online vs. brick and mortar stores – This is a disconnect.
* Even the mighty Proctor & Gamble is redeploying marketing spend away from traditional media to digital since it’s more efficient and less costly. They announced recently they will lay off 1,600 people and are banking on digital ROI for long term savings. However, I bet P&G is also developing the internal infrastructure to capture the data and share it with relevant internal business groups to help change their business models.
* Outsourcing of social media initiatives to outside agencies exclusively is probably not best option given need for integrated brand messaging.
* More companies are adding IT capabilities to marketing management job descriptions. Marketing and IT are converging into one function. Marketers now need to learn digital in addition to traditional marketing / brand building skills to be effective going forward.
Source: Boston Consulting Group
Based on this, a few conclusions come to mind.
1) CMO’s need to better understand social media and how it works beyond just giving assignment(s) to outside agency(s).
Simply outsourcing social media will not work. They need to know how to effectively use it for impact. CMO’s really need to know SEO and how consumers are talking / searching about their company / brands. They then need to have the right strategy(s) and develop the right social media tool(s) addressing those strategy(s). It also needs to be measurable to make sure it’s working. Developing the right kind of metrics will go a long way to proving social / digital marketing effectiveness. This might require testing of alternative approaches to see which works / doesn’t work and not just guessing.
2) When social media / digital marketing is used there needs to be a organized and well thought out customer / consumer feedback loop to the organization.
Comments / data from consumers, influencers, other stakeholders and communities need to be filtered back not only to marketing, but to customer service, sales, supply chain, finance and even engineering / R&D. You need an internal infrastructure to capture this information and be able to synthesize it for these groups so appropriate changes can be make to companies business models. Social media is cheap…but there is a huge labor cost involved in using the data to help change your business.
3) Finally, using social media / digital marketing tactics exclusively is probably not a good idea.
A good business strategy will probably require a blend of BOTH traditional TV marketing and social media / digital marketing. We must remember digital marketing is a “slow burn” approach and in some cases won’t help brand building that quickly – just like traditional TV marketing. In some cases traditional advertising or promotions will help jump start a strategy while social / digital marketing will help build the brand in the long run. Using both to some degree is the best way to EFFECTIVELY grow your business, but again it needs to be driven by strategy and not the latest tool / technique.
Marketing is evolving and social / digital marketing is part of that evolution. We all need to learn how to use the new tools as well as refining the old.
Chief Marketing Officer/Principal, Brand Marketing Advisors
The Global Brand Guy