Business gets social but not to plan

Elizabeth Knight
May 30, 2014
The Age
Here are a few random facts on the use of social media. People over 50 are far more likely to post ratings and reviews of products (for example, fridges) and services (hotels and restaurants and holidays), men are more likely than women to do so.
And even more random: 17 per cent of men access social media while on the toilet as opposed to 5 per cent of women.
At the very least these facts provide some insight on the extent to which research into the usage of social media now drills so deep that it gives new meaning to the notion of big data.
Large retailers have spent hundreds of millions of dollars over the past few years developing online strategies, a major part of which is developing social media platforms.
But the statistics on how smaller companies use the likes of Twitter, Facebook and Instagram is now the subject of some serious research by companies keen to provide marketing insights to the small businesses sector.
Those small businesses that use social media as a marketing tool will spend around $4500 this year for the privilege, which is more than double what they spent last year. Not surprisingly it is the retailers leading the charge.
Last year a third of small retailers were using social media and this year half of them are on board.
But pressure to join the social media revolution has been so intense that evidence is emerging that those jumping on the bandwagon are blindly investing in social media without any proper concept of whether the money is being wisely spent.
The aspect of social media that is regularly under-appreciated, particularly by small and medium-size business, is that it’s an investment that costs money. If they were to install a new piece of machinery there would be plenty of attention given to the returns that investment would yield.
Businesses understand they need a social media strategy, but in some cases that’s as far as their intelligence extends.
They get that when almost a third of grandparent-aged Australians are tapping into social media it’s no longer an option to ignore the potential benefits of social media as a mainstream marketing tool.
In a rush to join the social media push particularly small and medium businesses are either wasting money or not achieving measurable outcomes.
But small business understands it no longer can afford to avoid joining up to the social media program.
It’s a fair bet that many if not most small to medium businesses didn’t understand or had barely heard of Instagram, Tumblr or Snapchat and even fewer were using them as part of their marketing push.
They are now signing up to social media that many don’t particularly understand and which may well be poorly targeted to their market.
The annual report from Sensis on Australian social media habits suggests the way consumers are using social media is changing rapidly.
For example, almost a third are using social media to find out more about brands and businesses, while the number that research products is up from 20 per cent last year to 28 per cent this year.
And half of users look for product information or tips and advice while 62 per cent of users seek to access discounts, 51 per cent seek giveaways and 40 per cent want coupons.
The most popular products and services researched on social media include clothing and fashion (49 per cent), electrical goods (43 per cent), furniture and homewares (29 per cent) and computers/hardware (24 per cent).
Big business, which previously has used mainstream media as the major tool in their marketing strategy, has traditionally been particularly focused on the measurement of outcomes.
But the arrival of social media has democratised marketing, enabling even the smallest business to advertise. But without the wherewithal to develop a sophisticated marketing strategy it is a fair bet that budgets are being wasted or used ineffectively.
The intel from Sensis says that one third of these small businesses are not aware of what they have invested and a quarter don’t have a social media plan.
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