Top companies are spending more than ever on social media, but few have been able to measure its impact on their businesses, according to a new survey of chief marketing officers conducted by Duke University’s Fuqua School of Business. Social media spending is expected to take up more than 13% of marketing budgets next year, as opposed to the current 9%, the study finds. Over the next five years, that number is expected to grow to more than 21%. Digital marketing, overall, is expected to increase by 10.8% next year, while traditional advertising budgets are predicted to drop 3.6%.
“These spending patterns reflect the sizeable opportunity marketers perceive on the Internet, and they are right as companies have experienced a 25% increase in sales through the Internet in the last year,” said Christine Moorman, a business professor at Duke and director of the CMO Survey. She points out, however, that only 15% of marketers believe they can quantitatively measure the impact of social media spending, “an important prerequisite for marketers to get their seat at the table.”
Marketing executives have also found it difficult to integrate social media activities into the rest of their marketing strategies, but Moorman said, consistency is crucial between all marketing efforts, whether online or off. “If not, customers will remain unconvinced how the company can meet their needs,” she added.
Spending on marketing analytics is expected to jump from 7% of budgets to more than 12% in the next three years, though companies struggle with what to do with the glut of information, only using about a third of the data available, according to the survey. Still, 41% of companies say they use online data collected about customer behavior to help target their marketing. Nearly 82% of marketing executives say use of such is increasing.
Duke University’s Fuqua School of Business initiated the biannual CMO Survey in August 2008. The results are based on responses from 351 top marketing executives. It’s the longest-running survey dedicated to understanding the field of marketing, according to Duke.