Social Media Spending Reaches Record Highs. Ask These Questions To Ensure You have The Right Strategy.

The Covid-19 pandemic has lead to businesses shutting down, declining revenue and economic recession. Many in the social media marketing field have been uncertain about how this would impact budgets. But according to the latest CMO Survey spending on social media marketing has grown to record levels with a 75% spike since February 2020.

How Covid-19 Influenced the Importance of Marketing in Companies
The CMO Survey (https://cmosurvey.org/)

Social media spending reaches highs predicted for years.

The percent of marketing budget spent on social media has hovered around 10%-13% since 2014 while marketers always predicted it would reach 20% or higher. With the pandemic spending has finally reached 23% and marketers expect it to stay that high for the next year. The CMO Survey reports this in the context of declining overall budgets and revenue, but as those declined the average percent of revenue spent on marketing increased as most perceived it to be more important during the pandemic.

Why such a sudden and dramatic jump?

Part of this jump is certainly people using social media more. After years of stalled gains eMarketer updated predictions indicating US adults will spend 7 more minutes per day on social networks in 2020 than in 2019. But according to the CMO Survey marketers have also become more confident in social media’s contribution to company performance. After remaining flat for years marketer confidence in social media performance increased 23% from February 2020.

How was social media used during the pandemic?

The CMO Survey reports marketers used social media the most for:

  • Brand awareness and brand building 84%
  • Retaining current customers 54%
  • Acquiring new customers 51%
  • Brand promotions 48%

What does this mean for your social media strategy?

As marketers reduce spending on traditional advertising, they are shifting resources to digital and social. With this increased spending comes higher expectations. Now is a good time to check your social strategy to ensure you are headed in the right direction. Make sure your social media is focused on the right objectives, on the right people, with the right message, and in the right places.

Do you have the right objectives?

Are your objectives focused on building business like the one’s above? Or are your objectives focused on building social media vanity metrics such as followers, likes, comments and shares which make social media an end unto itself? Ensure that your objectives connect to company performance not social media performance.

Are you reaching the right people?

Have you identified a target audience based on a well-defined target market for your product or service? Or are you casting a wide net hoping to catching anyone who could use the product or anyone on the social platform? Look at customer data to determine who actually buys your product not just follows your social account.

Are you posting the right message?

Are you creating unique messages that speak to a well-defined audience with content customize to the social network? Or are messages more generic and content the same across social channels? Optimize content to increase performance.

Is your brand in the right places?

Are you on social media channels because you have been on them for years or because they are popular? Or have you evaluated social channels based on user demographics and engagement metrics of where your focused audience is most active? Take time to evaluate brand social platforms for wasted effort and missed opportunities.

Social media marketing has reached record highs and looks like it will remain there for at least the next year. As spending increases make sure your social media strategy will be as effective as possible.

Why You Need a Social Media Measurement Plan and How to Create One.

After years of increases, social media spending declined in 2019.

The CMO Survey saw a drop in social media spending to 11% of marketing budgets from a high of 14% in 2018. Why? The authors suggest, “… despite massive financial investments, social media is rated as contributing only moderate value to company performance (3.3 on a scale where 7=very highly and 1=not at all).”

If you’re not confident in social media’s return on investment (ROI), it will only get harder to secure funding for social media budgets. How can you improve this confidence? Ensure you have a strong measurement plan in place to better prove social media’s impact on the bottom line.Start with business objectives not social tactics.

In creating a social media strategy it is easy to start with social media tactics. You ask questions like, “How can we improve our Facebook page?” So you develop strategies to improve engagement on Facebook and you increase likes, shares and comments. Yet having a better Facebook page is not a business objective. That is why it gets hard when management asks how Facebook Likes contribute to the bottom line.

Having a measurement plan ensures you start with your business objectives (what impacts the bottom line) first. From there you create strategies and tactics (current and new) to help get to those objectives. Then you determine how those outcomes will be measured through KPIs (metrics) tied to micro- and macro- conversions. Goals are long term changes you would like to see. Objectives make goals measurable on a shorter time frame. Strategies are the ways you will meet objectives. Tactics are what you will use to implement the strategies. Click To Tweet

How to define business objectives.

The objective of most business’s is to increase sales, but each organization’s situation is unique and requires a much more nuanced definition. Insight can come from a situation analysis or the reason you are creating a new strategy. There is often a problem or opportunity that has become the focus of marketing efforts creating the story of your plan. The CMO Survey reports marketer’s see social media as a tool to help accomplish the following business objectives:

  1. Brand awareness/brand building
  2. Introducing new products/services
  3. Acquiring new customers (conversion/sale)
  4. Brand promotions (contest/coupons)
  5. Retaining current customers
  6. Improving customer service
  7. Improving employee engagement
  8. Marketing research
  9. Identifying new customer groups
  10. Identifying new product/service opportunities
  11. Improving current products/services

Identify strategies to meet business objectives.

Most social media plans have multiple strategies or ways to improve brand efforts and help to meet business objectives. List all your strategies such as an influencer marketing campaign, a special promotion, an employee advocacy effort or branding social media ads.

Identify tactics used to support key strategies.

List the main tactics that support each strategy. For example, a business objective to increase sales to a new market may have a brand awareness strategy supported by a tactic of targeted Facebook ads, a tactic of influencer marketing on Instagram, and a tactic of employee advocacy on LinkedIn.

List measurable conversions by tactic and strategy.

List measurable actions users take to fulfill your business objectives. They can take the form of macro-conversions and micro-conversions. Macro-conversions are the key actions closest to business objectives such as an online sale through website data or an offline sale through CRM or POS data. Micro-conversions are the smaller actions that move a prospect closer such as visiting webpages, signing up for a newsletter, down loading an app, or following a social media page. They can be tracked using various tools such as Google Analytics Tracking ID and Facebook Pixel for ads or organic posts.

Connect macro-conversions to business objectives.

Link social media metric KPIs by tactic and strategy to macro- and micro-conversions. Creating a dashboard of the KPIs for macro-conversions by tactic and strategy can be a top line report of social media’s contribution to company performance. Creating this in your digital measurement platform such as Google Analytics, Hootsuite, HubSpot, Salesforce, or Facebook Ads Manager gives you real time access or the ability to schedule regular reports to share with management.

Measure micro-conversions to map the customer journey.

Identifying and measuring micro-conversions on the way to macro-conversion can map out customer journeys. Micro-conversions help you understand human behavior giving insight to optimize strategies and tactics. Analyze metrics by tactic KPI to determine how many people are completing the customer journey and where you are losing or retaining people. This does not mean you will map one journey for all or even most customers. Google click stream data of thousands of customers found no two journeys were alike – varying from 1-176 days and 65-600 touchpoints across categories, brands and products. The marketing funnel still applies, but consumers have more control and options in moving themselves from awareness and consideration to conversion, loyalty and advocacy. Today it is more like a marketing scatter plot. The best you can do is optimize the touchpoint clusters around funnel stages and use CRM data for personalized content.

Conduct experiments to optimize strategies and tactics.

Having a good measurement plan that includes both micro- and macro-conversions enables you to know which tactics and strategies are contributing the most to company performance. From there you can experiment with different tactics and strategies replacing low performing ones to optimize social media. The results of a social media audit can help identify which strategies and tactics to experiment with first. While no two customer journeys are alike your micro-conversion and macro-conversion data can identify clusters of touchpoints versus outliers. Focus optimization efforts where many of your customers engage in the funnel stages on their  unique journey. Also deliver custom messages through unique customer tracking such as Google Analytics User-ID. Ultimately you want lower your cost per result or conversion.

The benefits of social media measurement plan.

Going through this process can take considerable time and effort. But once you have the plan in place the benefits are numerous. A social media measurement plan:

  1. Collects the right data to answer company performance questions.
  2. Creates reports or dashboards to share with decision makers.
  3. Allows analysis of segments of your social media plan.
  4. Enables testing different solutions to improve social efforts.
  5. Helps lower your costs per result or conversion.

Do you have a social media measurement plan? What else could help improve marketer confidence in social media’s contribution to company performance?