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‘Jury still out’ on social media investment: report

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“The jury is still out,” for many who have invested in marketing through social media – because they can’t measure the results, according to a new report.

That’s the verdict from 47% of the 800-plus industry professionals quizzed for Econsultancy’s Social Media and PR report 2010. Respondents included client-side marketers and PR professionals as well as supply-side respondents. Of them, 76% said they didn’t have an ROI figure for most of the money invested in the channel.

Some 83% of respondents said they’d used Twitter for their social media activity, while 80% had used Facebook. But there’s been a decline, since last year, in the proportion of companies using other social media-related websites and technologies from podcasts to social bookmarking and virtual worlds.

While 83% of companies expected to spend more on social media over the next year (compared to 86% in Econsultancy’s 2009 report), most companies’ spending is relatively low. Some 28% are spending nothing at all, while 33% spend less than £5,000 a year.

And 29% of companies don’t have a dedicated member of staff working in this area, while 32% have only one. Forty-nine per cent say lack of resources is a barrier to success and 30% say lack of budget holds them back.

Econsultancy research director Linus Gregoriadis said: “2010 has been a year in which companies have tried to become more focused in their social media marketing activity. Much of their activity is concentrated on the use of Twitter and Facebook, with the vast majority of companies (83% and 80% of respondents respectively) using these sites as part of their social media strategy.

“Companies are harnessing these sites for a range of business functions including marketing, sales, customer service and product development.”

He added: “Newer areas such as location-based marketing and social gaming are now being hyped in the media, although the data shows that very few companies have so far actually become involved.”

However, Andrew Girdwood, head of strategy at bigmouthmedia, points out: “Twenty-eight per cent of respondents to the survey worked exclusively in B2B channels and this further underlines social media as a business tool and not an entertainment fad.”

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