Social business is still underutilized

The leading companies in Germany, Austria and Switzerland have recognized the great importance of social media. Nevertheless, the enormous business potential of social media is not being exploited. This is the conclusion of a study conducted by the University of Zurich in close cooperation with Lithium Technologies, Coundco and other partners.

Lots of activity, little strategy

The study shows that although the majority of companies are active on social media channels, they do not have a strategy that enables sustainable and systematic monetization. Social media activities are not integrated into companies' core business processes and are managed bottom-up and by the requirements of individual departments. Social media is primarily seen as an alternative tool for classic push marketing. In contrast, the potential of pull marketing and user-generated content remains unnoticed. As a result, only very few companies use the possibilities of peer-to-peer-based social support (customers helping customers).

Measurability as a challenge

Only ten percent of the companies surveyed can prove the business benefits of their social media activities. Reach, interaction and traffic on the homepage are named as the most important key figures. In contrast, key performance indicators (KPIs) such as conversion rates, net promoter score and call deflection, which are decisive for sustainable corporate profit, are either not defined or not defined sufficiently.

Social media activities of 206 companies examined

Under the direction of Prof. René Algesheimer, holder of the Chair of Marketing and Market Research at the University of Zurich, and in close cooperation with Lithium Technologies and Lithium partners SAP, Netconomy, Coundco and Etecture, the study examined large companies with many years of experience in the business processes of marketing, sales, customer service and product/service development. For the study, the actual social media activities of 206 companies were examined first. In a second step, 73 of these companies were asked about their own assessment and evaluation of their social media activities.

Coundco supports and accompanies study

The Cound agency specializes in networked campaigns with social media extensions and community building. It accompanied and actively supported the study, among other things by referring its clients for the study, preparing the design of the study results and disseminating them on the web. For Florian Wieser, Chief Strategist at Coundco, the study shows that "trial and error remains an important approach when dealing with people in digital communities". The study also makes it clear that the interplay between short-term measures and strategy is still unbalanced. "Linking objectives, strategy and activities is the biggest challenge. Only with consistent networking will the measured key figures show their contribution to the two relevant market figures of turnover and cost savings," says Florian Wieser.

The most important figures from the study at a glance

● On a scale of 6 points, companies give social media an average importance of 4.3 points.

● 80 percent of companies use their social media activities to increase profits and improve their business results.

● 77 percent of companies measure the success of social media activities, but only 10 % can demonstrate concrete financial benefits.

● 70 percent of companies assume that they use social media intensively, but in reality this only applies to 48 %.

● 92 percent of companies use Facebook, but only 17 percent have their own forums or communities.

● Social media budgets currently account for an average of 0 to 5 percent of the total marketing budget.

● Most companies expect an above-average increase in their social media budget. This will rise to 11 to 15 percent within the next five years.

The study can under this link can be downloaded.