Social Media Will Get Real Budgets
In our 2010 trends post we mentioned that social media marketing will start to get real budgets. Every marketer who hasn’t been hiding under the rock for the last several years has noticed that something important is happening.
In a recent MarketingSherpa study almost half (49%) of the respondents say that they believe that social media will eventually produce ROI. Seven percent of respondents already see ROI and intend to increase budgets as needed to get better results.
Emarketers Debra Aho Williamson estimates that paid Facebook advertising will grow 39 percent in 2010 and reach 605 million dollars worldwide. The total spend on social network advertising would grow to 2.2 billion dollars worldwide and 1.3 billion in US.
But that is only paid advertising. In social media adaption paid ads are only one step and not very social at that. So we expect to see a lot more budgets to be earmarked for social media marketing. Building communities, setting up Twitter accounts and Facebook fan pages, creating content, capturing leads, measuring results. There are a lot of way to spend on social that will be hard to measure or classify.
We believe that bigger chunks of media and marketing spend will be channeled to payroll to hire community managers, bloggers and other specialists who are a key ingredient to make social media marketing really social. This in-house part of the social media spend may take up to two thirds of the budgets. This means that the total social media spend may be more than 7 billon dollars in 2010.
In the same category the payroll will finance social media when engineers talk directly to consumers and support personnel answers customer questions on Twitter or Facebook. As the organizations start to open up, more and more of social media interaction will be an integral part of employees daily routine and this way “social media budgets” may look smaller than they actually are even if we include in-house.
Higher budgets mean higher level decision-making. This will probably mean that some budgets will increase simply by added frictional costs of meetings and consultants. But higher level decision-making will also put pressure to produce real and measurable social media ROI.