Understanding how other companies respond uncertain economic conditions might not immediately help in dealing with day-to-day activities, but contextual benchmarking does help elevate the fear that one might be going it alone. 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, is one such benchmark. While the economy continues to move sluggishly ,it does appear that companies are seeing value in investing on most things social media. Here is a brief summary of the key research results:
CMO’s are focusing mostly on market penetration (sustaining innovation), secondly on new products for new markets (disruptive innovation):
>> Market penetration (sustaining innovation – introducing current products and services to current markets): 44%
>> Product and service development (sustaining innovation – creating and introducing new products and services to current markets): 26%
>> Market development (sustaining innovation – adapting current products and services to new markets): 18%
>> Diversification (disruptive innovation – new products/services to new markets): 13%
So, it looks like companies are still holding onto deriving revenue from their current base. While the “why this is true” has not been addressed in the study, anecdotal data tends to support the notion that companies have not yet found “systematic approach for capturing value in new markets.” It appears that most find this kind of disruptive activity very difficult, a point I address in other blog postings (e.g., Reinventing Innovation).
Social Media offers growth potential in effort to capture value (monetization):
>> Social media budgets will grow from 5.6% to 9.9% this year.
>> Over the next five years, social media budgets will increase to 17.7% of the total marketing spend.
B2B (business to business) outpaces B2C (business to consumer) spending and outcome expectations:
>> B2B companies plan the greatest increase in social media spending this year, jumping to 11% from 6.5% last year.
>> B2C services continues to grow from 2.9% to 6.9%.
>> 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.
>> B2B product and B2B services will scale to 15.3% and 18.9% respectively.
Social media experience and skill necessary for success; as such, hiring on the rise:
>>50%f of companies expect to hire new media marketers 2010
>> 61.4% and 77.5% will fill new marketing roles 2011 and 2012, respectively.
>> Only 27% are expected to look at university graduates.
>> The most sought-after skill sets include: Internet marketing, innovation and growth, social CRM, and brand managemen
Practical Aspects of Social Media: Art, Science, and Humanity 