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91% of Businesses Expect Their Social Media Investments to Increase Over the Next 3 Years

Social Media Investments

Nearly all business executives (91%) anticipate their company’s social media investments and budgets will increase over the next three years, and 62% of consumers note businesses that do not have a strong social presence will not succeed in the long run.

Social Media sits at the center of people’s daily lives and businesses are increasingly reliant on social data to inform strategic decision-making across an organization. In fact, according to new research commissioned by Sprout Social —an industry-leading provider of cloud-based social media management software—and conducted online by The Harris Poll, 85% of business executives report that moving forward social data will be a primary source of business intelligence for their company, and nearly half (46%) expect their company’s social media marketing budget to increase by up to 100% in the next three years. These plans align with consumers’ needs—the data shows that going forward social media is the #1 preferred way to learn about brands, ahead of all other channels including email, or TV and print advertising.

The Harris Poll, on behalf of Sprout Social, surveyed more than 1,000 US consumers and 250 business executives to understand how people and businesses use social media today, and how they plan to use it in the future. The report, “The State of Social Media: After a Year of Transformation, Executives Are All-In on Social,” reveals the importance of social media as a business strategy, its role as a cornerstone of customer experience, and the challenges facing brands in achieving success.

US companies today rely more on social media than any other communications channel for virtually all critical business activities.

Intelligence to Provide a Curated Experience

The report found that today’s consumers expect brands to use social media intelligence to provide a robust, curated experience. Social media investments are definitely needed when it comes to gather data and convert it into intelligence. And while most executives are aligned on the importance of social media for their business, they are not confident in their company’s ability to meet the needs of their customers on this mission-critical channel. Fewer than half of executives describe their current social media strategy as ‘very effective,’ while 90% of executives agree their companies need to more effectively use social data to understand their customers.

Social Media Investment
Anna Ginovker, Director and Senior Consultant, The Harris Poll.

“Our research shows that US companies today rely more on social media than any other communications channel for virtually all critical business activities,” said Anna Ginovker, Director and Senior Consultant, The Harris Poll. “Whether for sales or lead generation, engaging with customers, building brand awareness or for gaining customer insights, nearly all executives (95%) agree companies will more heavily rely on social data to identify business opportunities outside of marketing. A majority of executives (59%) also anticipate their use of social media to increase over the next three years indicating this channel is certainly here to stay—as much for businesses as it is for consumers.”

“There is no doubt this past year served as a catalyst for the digital transformation happening across businesses, but what I find most compelling from the report findings is that this transformation is disproportionately unfolding on social media,” said Ryan Barretto, President of Sprout Social. “Consumers are clear—social media is where the customer experience should start, develop and end. Compared to a year ago, consumers have increasingly used social media to discover new brands (43%), recommend brands to their friends and family (33%), and make a purchase (36%). These numbers become even more pronounced for younger generations. For businesses to thrive in this world, it is clear that social insight on key touchpoints across the customer lifecycle cannot be a long-term plan, it must happen now.”

Social media is where the customer experience should start, develop and end.

Imperative for Social Media Investment: Additional key findings

  • Social media will become the most important source for data and insights that inform key business decisions. Nearly all executives (95%) agree companies will more heavily rely on social data to identify business opportunities, including those outside of marketing, over the next three years. They anticipate the use of social media data to inform strategy and business decisions across sales (67%), customer service (61%), Product (53%), Research and Development (48%), and Human Resources (43%) departments.
  • Social media usage is trending upward, especially among younger generations, and expected to continue to grow: The use of social has grown among the majority of consumers over the past year (54%), and 34% expect it will continue to increase over the next three years. Gen Z and Millennials have driven the greatest surge in usage (65% and 63%, respectively), and are more likely to note they expect it to keep rising (45% and 46%, respectively) compared to other generations.
  • Relevance is at the core of the customer experience: Consumers expect companies to use social media to provide a more personalized experience based on previous interactions (61%), read and analyze what customers post on social media (59%), and know them better based on their activity on social media (51%). This is more pronounced among Gen Z, Millennials, and Gen X, yet no more than 44% of executives are ‘very confident’ in their social media strategy meeting the needs of different generations.
  • Positive social media experiences translate into sales: Seventy-eight percent of consumers are more willing to buy after a positive experience with a brand on social, 77% will choose that brand over the competition, and 72% will increase their spending, demonstrating the impact of social on the bottom line.

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- 6 things to know

Study Claims Contextual Targeting Is More Cost Efficient than Behavioral

In contextual  targeting, advertising media are controlled on the basis of the content of a website using linguistic elements. The advertisements themselves are selected and served by automated systems based on the context of what a user is looking at. Contextual advertising helps a brand understand what a consumer might like without needing personally identifiable information. Results of a new study show that digital advertising campaigns that employ contextual targeting are more cost-efficient than behaviorally targeted campaigns.

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Amidst a wave of data privacy regulation and third party cookie phase-outs that have digital advertisers scrambling for solutions to maintain campaign efficiency and scale, contextual targeting has frequently been touted as a data privacy-friendly alternative to behavioral targeting––but until now the viability of that claim has gone largely untested. Tech and media firm GumGum published a case study called Understanding Contextual Relevance and Efficiency: A Comparison of Contextual Intelligence Vendors and Behavioral Targeting. Findings seem to give credence to the promise of contextual as results indicate that digital advertising  campaigns that employ contextual targeting are more cost-efficient than behaviorally targeted campaigns. The study was sponsored in partnership with Dentsu Aegis Network and conducted by an independent third-party researcher.

Contextual Targeting
GumGum CEO Phil Schraeder.
It is fabulous to finally see a head-to-head contextual-behavioral match up and get hard data behind contextual targeting’s value.

“Machine learning-backed contextual targeting has been a central tenet of our offering since the get-go, so to some degree, from our perspective, this study states the obvious, but it is fabulous to finally see a head-to-head contextual-behavioral match up and get hard data behind contextual targeting’s value,” said GumGum CEO Phil Schraeder. “There are plenty of doubting Thomas’ about contextual as an answer to the cookie’s death and this ought to give them some faith.”

While the study was principally designed to better understand the overall effectiveness of contextual intelligence in comparison to behavioral, it also sought to benchmark four of the top contextual intelligence vendors in the industry. For the study, Dentsu Aegis Network ran live campaigns for four of its major brand clients, including Sephora, across four contextual intelligence vendors, as well as by leveraging behavioral targeting. The campaigns utilized the same brand safe inventory. The campaign served 1M impressions, which were measured for cost efficiency and content relevance.

We needed to gauge the effectiveness of the numerous emergent contextual intelligence offerings.
Contextual Targeting
Brian Monahan, Global Client President and Head of US Ventures for Dentsu Aegis Network.

“In a world with diminishing access to audience targeting, as responsible partners to our clients, we need the most robust understanding of potential best practices and tools available for success,” explained Brian Monahan, Global Client President and Head of US Ventures for Dentsu Aegis Network. “Beyond value-testing contextual, we also needed to gauge the effectiveness of the numerous emergent contextual intelligence offerings. This study gave us both of those things––and the results are compelling.”

Indeed, the study found that, taking into account CPMs, the contextual Intelligence vendor in-demo impressions (eCPM) cost 29% less than behaviorally targeted in-demo impressions, with GumGum Verity™ impressions costing somewhat less (36%)––and overall that for CPC and vCPM the costs of using contextual targeting were lower than behavioral (48% and 41% respectively).

 

For the study, Nielsen Digital Ad Ratings Reporting, Xandr, GumGum, MOAT provided the cost efficiency measurement of impressions. Appen, a third party vendor specializing in human annotation of urls, measured content relevance.

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Changing Places

Futbol Sites Receives Investment, Loida Casares, Charles Gabriel

Changing Places

Jordan Gnat, Robin Chhabra, Andy Clerkson, Loida Ruiz….People invest in companies, change positions, get promoted or move to other companies. Portada is here to tell you about it. Check out last week’s Changing Places here.

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Jordan Gnat, Robin Chhabra and Andy Clerkson Invest in Futbol Sites

Futbol SitesDigital sports media group Futbol Sites announced that it is joining forces with Jordan Gnat, Robin Chhabra and Andy Clerkson, who together have acquired a significant interest in the Group, as well as appointing Mr. Gnat as Vice-Chairman of Futbol Sites. The terms of the investment were not disclosed.
Federico Grinberg, CEO of Futbol Sites tells Portada that a “key element of the company’s strategy going forward will be to accelerate growth in the U.S., both in the U.S. Hispanic as well as the general market. Futbol sites recently launched a new website catering to the U.S. general market. ”
Grinberg adds that online sports betting has had a significant advance in the United States and Futbol Sites also aims to be a major player in this sector. Jordan Gnat is a Senior Business Executive with over 25 years of leadership experience and over 17 years in the global gaming and media industries. Most recently Jordan was the Group Senior Vice President of The Stars Group, the parent company of PokerStars, FOX Bet, PokerStars
Casino, SkyBetting and Gaming and Oddschecker Group Media. Robin Chhabra is an experienced executive in the online gambling industry and currently serves as the Chief Executive Officer of FOX Bet, a landmark partnership between Flutter Entertainment and FOX Sports in the USA. He was previously on the Executive Committees of The Stars Group, William Hill and Inspired Gaming Group where he focused on strategy, business development and M&A and expanded the global footprint of each of these companies. Andy Clerkson has spent three decades building brands for media, sports betting and gaming companies in the USA, UK and Europe. In 2019, he helped The Stars Group and FOX Sports set up FOX Bet, for whom he is a senior advisor. In 2007 Andy founded influential digital marketing agency Grand Parade, which specialized in sports betting and was acquired by William Hill in 2016.

 

Loida Casares

Loida CasaresLoida Casares has taken on a new role as Account Manager for Houston Public Media and Market Enginuity. She manages an account desk and sells corporate sponsorships for KUHF 88.7 NPR, Channel 8 PBS, digital media and podcasts for Houston Public Media and Market Enginuity. She also sells multi-market campaigns that include any of the other 17 markets that Market Enginuity represents. She will report to Millie Adan-Garza, Director of Sales and Corporate Sponsorships. Casares began her professional career in advertising 27 years ago at the Houston Chronicle. Until recently, Casares worked as a Senior Account Manager at the Houston Chronicle.

Charles Gabriel

Charles Gabriel

WildBrain Spark, the digital media division of WildBrain—one of the world’s largest independent kids’ and family entertainment companies—has appointed Charles Gabriel to the newly created position of Vice President and Head of US Advertising Sales. WildBrain Spark builds brands through the management and creation of preschool and children’s entertainment content on platforms such as YouTube, Amazon Video Direct and ROKU. WildBrain Spark’s branded YouTube network is one of the largest of its kind, featuring more than 260,000 videos for more than 800 kids’ channels in over 30 languages. Every 90 days, one in every three kids worldwide with access to YouTube watches video content on the WildBrain Spark network, which has over 168 million subscribers, and approximately 4 billion views per month.
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- Feature

To the Portada Community: We Are Here to Help

Dear Members of the Portada Community,

We hope this message finds you healthy and safe. We know that the coronavirus crisis is bringing up many until very recently unthinkable challenges for the marketing community.  We deeply appreciate the relationships we have built, and we understand this is also a difficult time for your brands and businesses. We want to tell you that we are here to help. Please, let us know if you have any inquiries or if there is anything we can do for you at this time.

Over the next weeks we will be closely monitoring the situation and are looking forward to soon continue providing you:

  • Year-round participation in 24 virtual and in-person brand decision maker workshops belonging to 6 different units of the Portada Council System.
  • More than 800 1:1 meetings with pre-screened brand marketers annually.
  • Thought-leadership opportunities on topics chosen by brand marketers based on their needs.
  • Best-in-class digital marketing solutions through Portada media.


Throughout these challenging times, we will also continue providing marketing information, insights, and industry updates you rely on to drive your business forward on our website www.portada-online.com and mercadotecnia.portada-online.com.

Stay safe! We look forward to seeing you in the near future once the coronavirus is behind us.

Your Portada Team

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- Feature

How the Coronavirus Will Impact Marketing

Short term it will likely have an impact and it may also  accelerate trends that are already under way. How will the coronavirus impact marketing? Four things to take into account.

1. Short term: Uncertainty and Risk Aversion…

The coronavirus may soon be contained and ultimately not have a major impact on economic activity levels, similarly to the 2003 SARS outbreak and the 2014-2016 Ebola outbreak. In the short term, however, things are likely going to get worse before they stabilize. That’s because virus outbreaks, by definition, initially have a very high growth rate of positive cases.  Uncertainty rules.  “I think the reason we were not specific was just because I think at the moment, it’s really just unknowable,” WPP CEO Mark Read, said during the company’s earnings call last Thursday February 27, when asked about the business impact of coronavirus on WPP’s China business. “It’s more unknowable today than probably it was Friday, if we had this meeting Friday of last week, we may [have] given you a different answer then we give you today.” As COVID 19 cases grow outside of China, the uncertainty is also increasing in the rest of the World, including the rest of Asia, North America and Europe (the main marketing hubs).
Not surprisingly, all major agency holding stocks have taken hits along with the broader market last week. With WPP’s shares falling 15%; IPG is down 5%; Omnicom is down nearly 4%; Dentsu Aegis fell 2.5%; and Publicis Groupe down 5.6%. In the real economy,  global tourism and retail have been hit particularly hard, as Chinese tourists provide a major source of income for many markets.

2. Coronavirus Impact on Marketing: More emphasis on Virtual – Digital Marketing

In the short term companies are starting to restrict travel and encouraging remote work (e.g. Amazon told its employees to avoid all non essential travel for now including within the U.S.) Facebook, on its part,  last week cancelled a global marketing conference in San Francisco’s Moscone Center. Activations and sponsorships at live events may be impacted negatively as marketing, including event marketing will become more virtual. This is not good news in a year where analysts were expecting to see an uptick in media investments from marketers eager to capitalize on events like the 2020 Tokyo Olympics.

The virus may also accelerate a trend that was happening anyway. Executive meetings and virtual events over hangouts will increase. For an example check out Portada’s Council System of brand marketers, which conducts 12 brand decision maker virtual workshops a year.

3. Driver for E-Commerce…

In parts of China, major retailers like Starbucks, Uniqlo, Nike and Apple have temporarily shuttered their stores, while small and medium-size retailers are being hit particularly hard as foot traffic dwindles. This may happen in the U.S. in areas that have been particularly negatively affected by the outbreak. Reduced in-store activity will be a driver for increased e-commerce activity and e-commerce marketing. The big caveat here is if the outbreak creates serious supply chain issues (at producers, shipping and overall logistics e.g. Apple and Microsoft warning of supply chain problems last week), therefore limiting the amount of goods that can be purchased by online buyers.

…particularly Online Grocery…

Housebound consumers in China are turning to online groceries for their daily food supply. According to French retailer Carrefour, vegetable deliveries increased by 600% year over year during the Lunar New Year period. Chinese online retailer JD.com reported that its online grocery sales grew 215% year over year to 15,000 tons during a 10-day period between late January and early February. Concerns about food delivery due to possible food contamination have spurred recent innovation in contactless pickup and delivery services by companies such as McDonald’s and Starbucks. McDonald’s has implemented contactless pickup and delivery of Big Macs, fries and other menu items across China as the outbreak has unfolded. Customers order remotely – on mobile phones or by computers in store – and employees seal the meals in bags and put them in a special spot for pickup without human contact, McDonald’s says on its website.

4. Coronavirus Impact on Marketing: Boost to At-Home Entertainment, Video Streaming and Gaming

If employees are forced to stay at home more, it will also impact how consumers spend their leisure time as they may have to avoid public gathering spaces, like movie theatres, concerts and gyms, leaving more time for them to binge on home entertainment and video services. Advertising revenues of companies that heavily bet on video content and advertising ,e.g. Roku, Youtube, Netflix and others should benefit from a public that’s stuck at home.

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