Ronnie05's Blog

Is social media a marketing hyperbole? (Part II)

Posted in Social context, media and advertising by Manas Ganguly on January 27, 2010

Is Social Media a Marketing Hyperbole? This was an earlier post that I had written 9 months back. I return to this topic not any clearer after 9 months of social media exploits though. There is lot of hype around, but is there enough substance backing the hype.

Money spent on social media-related advertising is expected to grow this year significantly. Forrester Research’s Interactive Marketing Forecast for the next five years, estimates social media marketing to grow at an annual rate of 34 percent – faster than any other form of online marketing and double the average growth rate of 17 percent for all online mediums. Forrester had estimated that $716 million would be spent on the medium this year in 2009, growing to $3.1 billion in 2014. At that point, social media will be a bigger marketing channel than both email and mobile, but still just a fraction of the size of search or display advertising ($31.6B and $16.9B, respectively). Not surprisingly, some of this growth comes at the expense of offline advertising. Forrester estimates that online advertising will grow from 12 percent of total marketing spend this year to 21 percent by 2014, meaning that offline ad spend will fall. In fact, Forrester concludes that “overall advertising budgets will decline,” meaning efficiencies are being had by shifting money to the Web.

Another recent report published by eMarketer, has now declared that the medium is considered the top priority in the digital space according to a survey of senior marketers. 45.4% of respondents considered social a ‘top priority’ while another 42.2% deemed it ‘important’. That narrowly beat out digital infrastructure for the top spot, with other marketing tactics like search, mobile, and blogger outreach trailing significantly. The data, also indicates that ‘time on site’ is now the metric marketers are most interested in, followed by unique page views, click-thru rate, and the traditional page view. that engagement is here to stay as the preferred way of doing business. That means both more engaging ads that leverage social media, and more engaging web sites that keep users around beyond a simple page view.

Social media marketing will definitely be an important portion of the marketing mix as businesses are able to tailor their products better with engaging with users using sophisticated communication platforms. Marketeers around the world are watching some successful models like Dell execute social media in an optimal way.

Dell is one of the few companies which have driven the social media to their advantage. While such examples are widely acknowledged and appreciated, working out such examples and such business models is tricky. We would discuss the Marketeer’s dilemna in going for Social Media in my next post.

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  1. […] Original post: Is social media a marketing hyperbole? (Part II) « Ronnie05's Blog […]

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