Economic downturn could be a boom for social media marketing
6th February 2009, 04:34 pm by Matt RhodesYesterday we posted about statistics from MarketingSherpa showing that a lack of knowledge hampers social media marketing, with 46% of firms who had not adopted social media marketing citing a lack on internal understanding as their main hindrance. Another set of statistics from MarketingSherpa paints a more positive outlook for social media agencies.
In September 2008, just as we were recognising the full potential of the economic downturn in which we now find ourselves, they surveyed almost 400 firms asking them about their marketing spend for 2009. Which lines would increase and which lines would decrease.
A total of 48% of the firms interviewed predicted that their spending on social media would increase in 2009, with just 20% predicting a decrease. This compares with print advertising, where just 4% predicted an increase and 60% a decrease, and Radio / TV ads which saw a dramatic 83% of companies predicting a decrease in expenditure in 2009.
This data supports what many others are seeing: social media agencies and social media marketing could boom during the economic downturn. Part of this is due to the positive growth trajectory that the social media business was on before the economic downturn. The industry was growing anyway, and so even in an economic downturn we would expect some level of growth to continue. But the industry is feeling more buoyant and optimistic than that.
Today we at FreshNetworks are reporting a strong 2008 with good performance, client wins and the release of version 2.6 of our online community platform. For us, the social media and online communities markets in Europe feel very positive at the moment. Firms are recognising the need for closer engagement with the customers, want to use online research communities for a greater depth of insight and want to innovate and stay ahead of their competitors.
We think that 2009 is going to be an exciting year for the social media marketing industry, and for online communities in particular. We expect to at least double in size by the year end and will be releasing version 3.0 of our platform during the year. Many others that we know and speak to in the industry are also feeling confident and whilst some industries are suffering from the current economic conditions, it’s important to remember that not all will.
So the economic downturn is not bad news for the social media marketing industry. In fact for some it could be a real catalyst for growth in demand with these services being more in demand, and traditional marketing and media contracting. Should be exciting times ahead.
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Chris Savage:
Hi,
Makes sense. Social media is dirt cheap, people can’t afford to go out, everyone (in the UK) is going digital (see Digital Birmingham campaign for an eg.)
Good times for social media!
But how to differentiate as a social media expert and practitioner when everyone believes they can “do” social media?
6 February 2009, 4:39 pmMatt:
Hi Chris,
Thanks for the comment. And you’re right, it does make sense.
I tend to take the pragmatic approach to differentiating those who are good from those who are bad. Judge it on results. Ask their clients what they did and how they helped. Good practitioners will have tangibly helped their clients make more from social media and will have clear ROI stories to back it up. Others won’t.
Matt
6 February 2009, 4:46 pmDan Rockwell:
I think its too easy of an answer.
As population struggles make a buck and get a job no doubt they’ll be turning to any and all available outlets for satisfaction- that means more web, more escapism, more facebook, twitter, free video, free music, free probably won’t pay for anything comes to mind.
All things considered its a great time to be on the web because nearly anything you want is practically free.
So the attention is there, I get that, but how you can effectively bank on that- that’s still up in the air.
Your in a race not only to gain coveted awareness but useful meaningful context. Its something your brand should of figured out before the web ever arrived.
If anything it may force brands into an uncomfortable space of actually caring above and beyond what they thought was the norm. They could be venturing into the dangerous waters of utter BS which nearly everyone on the planet can sniff out.
So sure, social media will get more attention, much like rising crime, clipping coupons and pirating movies will. But I don’t think its a “boom” in the bag sorta deal. It may even be a logistical challenge in that you’ll have to decide where you want to be- twitter, youtube, facebook, ning, your own social network, is that compatible with your customer, do you know your customers?
As for the experts in social media, anyone who’s been in a few betas and or addicted to twitter is potentially swooping down on your prospects, expert o plenty afoot. Because the barriers to build/listen/measure social media tools and outlets are nearly free its a mass free for all out there in social media expert mayhem.
Fun times ahead!
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