Correlation between Social Media & Financial Success
23 Jul 2009 (Thu)THE BRANDS MOST ENGAGED IN SOCIAL MEDIA are also experiencing higher financial success rates than those of their non-engaged peers, according to a new study released by enterprise wiki provider Wetpaint and the Altimeter Group. ReadWriteWeb reports:
To determine this relationship, the study focused on 100 companies from the 2008 BusinessWeek/Interbrand Best Global Brands survey and the various social media platforms they used like Facebook, Twitter, blogs, wikis, and forums… After examining the companies and their social media activity levels, the brands were ranked on an “engagement scale” where scores ranged from a high of 127 to a low of 1. Those brands that were the most engaged saw their revenue grow over the past year by 18% while the least engaged brands saw losses of negative 6%.
The study grouped the brands into one of four engagement profiles that related to the number of channels they’re involved in and how deep that involvement is. At the top of the list are “mavens,” the brands heavily engaged in seven or more social media channels – like Starbucks and Dell, for instance. “Butterflies” are like wannabe “mavens,” and are also engaged in seven or more channels but are spread too thin, investing in some channels more so than others. “Selectives” focus on six or fewer channels but engage customers deeply in the ones they’ve chosen. Finally, there are “wallflowers,” or brands engaged in six or fewer channels with below-average engagement; these include companies like McDonalds and BP.
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Posted by J.K. in *Insights, Business, Marketing, Quantitative, Research, Social Media, Technology | 6 Comments |
July 24th, 2009 at 12:28 pm
Thanks dear very use full stats
July 27th, 2009 at 7:38 pm
Really informative article .. good post .. financial performance of companies are now linked to the ad spend by these companies!
August 1st, 2009 at 2:44 pm
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October 7th, 2009 at 12:33 am
I think there is a bit of a chicken/egg question here as well. Companies that are most likely to actively engage in social media are also already aware of the importance of customer service and listening to/connecting with customers (Southwest Airlines comes to mind). These companies already “get it” when it comes to creating relationships with their customers and probably would still be growing their market share even if there were no such thing as online social media. It’s another tool for good companies to connect and speak to their customers.
October 7th, 2009 at 8:37 am
Thanks, Aaron. This is a sharp observation. I had a similar thought as I read the results of the study. However, you put it quite eloquently and makes one want to visit your website to hear more from you!