Many companies talk about the benefits of social media, but few are making significant investments in social media programs. More than 60% of the companies in our survey indicated social media represents between 0 – 5% of their total marketing budget. This is fairly consistent regardless of company size.
Most of the companies we surveyed indicated they use social media to promote their business, but few seem to have a specific or consistent approach to the process. Just like any other marketing endeavor, without a clear strategy which is focused on achieving specific goals, the activities can keep you busy without producing any real results.
One important note, most business owners do not include the cost of manpower in their calculations of the cost of social media, so across the board, we believe their cost estimate are lower than actual expenditures.
Does the investment pay off? The data clearly indicates a positive correlation between investment and results. Companies which are putting their toe hesitantly in the water, carving out 5% or less of their total marketing budget, rarely indicate a significant portion of their sales come from social media.
Conversely, those organizations which are seeing social media driving a significant portion of their sales are setting aside more of their budget for the medium
This was one of the topics I addressed at BlogIndiana this summer.
The 2011 Small Business Social Media Survey was conducted by Roundpeg. If you would like a free copy of the complete report simple click here to download