For the past five years the UMass Dartmouth Center for Marketing Research has surveyed the Inc. 500 and Fortune 500 companies on their use of social media. Last week, we reported the results of the 5th Annual Benchmarking Study of the Fortune 500. Previously, we wrote about the Center’s 2012 Inc. 500 Social Media Update. We invited the co-author of the studies, Dr. Nora Barnes, to expand on her findings in both studies, comparing social media usage of the two groups and her predictions for the future. Here are her responses to our questions.
Based on five years of data, any predictions on where companies will be on social media in the next 5 – 10 years?
Our studies indicate that attention will move from a focus on tools to focus on measuring, monitoring and a discussion regarding the ROI of their social media efforts.
Companies will move from repositioning or retraining employees to handle the social media function to hiring social media professionals.
Social media plans will be as common as marketing plans for a company and budgets (including investments in software or consulting and hiring) will be clearly defined.
When sales/donations/recruits are committed, companies will be able to track the consumer to an initial social media contact with the company.
Companies will not necessarily continue with every tool they are currently using. Instead they will focus on those tools that have proven (through data collection, measuring, monitoring, tracking) to be the most beneficial for their goals. New tools will be introduced and current ones will change in terms of their primary users. Businesses will watch these changes and act accordingly.
Participating in a particular tool today will certainly not guarantee a company will choose that portal in the future. As our ability to measure the value of these channels improves, our decision making regarding our social media initiatives will change.
Why did UMass undertake the research studies of the Inc. 500 and Fortune 500 regarding their use of social media?
In 2006, the UMass Dartmouth Center for Marketing Research conducted the first ever, academic study of business bloggers. The incredible reaction to that study convinced us that the social media world needed more and better information about this new and burgeoning field. Our premise has always been to work with statistically valid samples, which simply means we need a list. It’s the only way to tell if we have collected enough data to make valid conclusions.
The Fortune 500 and Inc. 500 were readily available, had not yet been researched in this way, and were of great interest to others. Again, the reaction to these now annual studies continues to encourage us.
Are there any consistent themes for each group? In other words, do the smaller companies use social media differently than the Fortune 500?
They not only use social media differently, smaller companies use more of it. The Inc. 500 generally out-blog, out-Tweet and outpace the Fortune 500 with every other tool we’ve studied in comparison to the Fortune 500. The Inc. 500 favor LinkedIn and Facebook while the Fortune 500 favor Twitter.
The smaller companies are quicker to adopt new tools like Foursquare or Pinterest. The Fortune 500 are just now reaching levels of adoption enjoyed years ago by the Inc. 500.
Where have you seen the biggest changes over the past five years in the use of social media?
While we have been tracking blogging, podcasting, bulletin boards and early networking sites like MySpace, it is more recently that we’ve included newer tools like Facebook, YouTube, Twitter, Foursquare, Pinterest and others. The changes are always interesting. In the Inc. 500 blogging was relatively high compared to the Fortune 500.
Here’s how it looked over the past 5-6 years for blogging among these two groups:
% of Fortune 500 blogging:
2007 (8%) 2008 (16%) 2009 (22%) 2010 (23%) 2011 (23%) and 2012 (28%). Companies blogging are consistently and slowing moving up.
% of Inc. 500 blogging:
2007 (19%), 2008 (39%), 2009 (45%), 2010 (50%) and 2011 (37%).
Last year was the first time we’ve seen a decline. The 2012 Inc. 500 study is coming out this fall.
It’s different for each tool, but right now the Fortune 500 favor Twitter (73% vs. 64%) and the Inc. 500 are more likely to use Facebook (74% vs. 66%). Adoption of both tools has consistently increased over the years in both groups. MySpace has virtually no adoption in either group at this time but Foursquare and Pinterest are now being used by a small number of businesses.
By industry, which companies are most active and is there a difference between companies selling services and products?
It’s difficult to draw conclusions by industry since some industries have only a few companies that make the list. While most of those may be involved with social media, there is always the distortion of the small sample. We do see some indication that those involved in B2C use more social media, those in the computer software/equipment industries and those in retail and food companies use a lot of social media.
The more heavily regulated industries like pharmaceuticals, financial companies and tobacco and alcohol companies seem to be less likely to embrace social media.
How is UMass using social media to communicate to its various constituents? How does the Center for Marketing Research use social media to share the findings of its studies?
When we conduct our studies, we do so with the intent of releasing the information for free so that those who need the information can readily obtain it at no cost. We do this by first making our reports available to all those who took the time to participate.
We have a subscription service so that anyone can automatically receive our reports as we generate them. Beyond that, we are fortunate enough to have great relationships with groups like Society for New Communications Research, MarketingProfs, Write Speak Sell, and other prolific bloggers who cover our work and help us to share the findings.
Typically, these wonderful helpers almost always draw the attention of the traditional media who have included our work in Inc. Magazine, Business Week, CNN, the Washington Post, The New York Times, Financial Times and other media outlets. The online community has supported and sustained our work and we are grateful. Beyond that, the Center has a Facebook, a Twitter , a slideshare channel and a Pinterest board.
Any plans for other social media studies?
We are always on the lookout for lists that might be interesting in terms of their use of social media. We recently released a study of the top MBA programs identified by US News. (They use a lot of social media but do not track the applicants that come from those portals). We track undergraduate colleges and universities, charities and the Inc. and Fortune 500’s on a regular basis.
We are open to suggestions. We try to stay away from groups that have already been looked at by others like political candidates, hospitals, cities and towns, etc. As long as we can locate the target population, we can interview them. We look forward to finding new groups to study and new questions to ask.
We believe that we should help move the conversation forward so that an early focus on tools might now move to a fruitful discussion of monitoring, tracking, measuring and the value of calculating an ROI for our social media initiatives.
Nora Ganim Barnes is a professor at the University of Massachusetts Dartmouth where she teaches and directs the Center for Marketing Research. Her social media work has been covered online and in print by Business Week, The New York Times, Washington Post, Financial Times, CNN, Reuters, Wall Street Journal, Fox News and Computer World among others. She has been named a Senior Research Fellow by the Society for New Communications Research.