How Much Should Brands Budget for Social Media?
What percentage of a B2C or B2B brand’s budget should be spent in strategies and tactics that we would label “social media-related?” Within that percentage, how should the money really be applied with the big amorphous box we all call social media? Big questions. I find it hard to generalize while at the same time am driven to try and do just that. I want to establish some benchmarks based upon all of the brand work I have seen or touched in my job. Clearly what is right for a Unilever may be very different than what is right for a Siemens. Selling cars (Ford) is dramatically different than mobile phones (LG). Running your business in North America may be very different than China.
All these differences aside. I do see a common trajectory of ‘spend’ at least as applied to B2C and separately to B2B. That path has more to do with increased experience in social media tactics, the adoption of, what I will call, a social media business mindset and the integration path for social media going forward.
Experience in social media tactics – For simplicity’s sake, lets look at what most marketers go through (including this one). Here are three stages of adoption:
- Social Media Experiments – usually the first year or two of unconnected social media programs involving bloggers, video content distribution, cgm/ugc contests and other tactics.
- Adoption and Integration – in the following years, the value or success of social media is felt within and there is a push to do more and integrate it with more people and disciplines.
- Go ‘Big’ – after some experience and success following integration, brands can’t help but want to “go big” either with a substantial facebook campaign or a more impactful integration (e.g. committing to 20 people in social customer care via Twitter and Live chat). usually these brands have sketched out a measurement model that reassures them the effort is smart business.
Social media business mindset – Is using social media an obligation due to outside pressures (your CEO, board, competitors all told you to do it in one way or another)? Or do you see a way – perhaps murky now – but a way that all of the implied qualities of social media may actually change your business? I see plenty of CMOs and CCOs who fit into both camps. So, the choice is between social media as obligation or social media as quest.
In many cases, brands will likely embrace the most valuable output of social media – advocacy (or word of mouth) and engagement – as ‘must haves’ for every program and brand. Key activities will continue to be labeled social media while more and more social elements will get baked into PR, user experience, digital marketing and more. In this way social budgets will be dispersed in the organization.
Rilla Delorier, CMO of Suntrust Bank, mentioned via AdAge:
“The great thing is less than 5% of my total spend is in social media. We’ve reached over a million customers this year through that mechanism. It’s a very efficient way to get feedback on what’s working and what’s not.”
She said this in context of a program called Live Solid. This features a microsite with embedded YouTube videos, a Facebook page and a Twitter handle amongst may other online tactics (SEO? SEM? Display? CRM?) and likely some related offline programs as well.
I don’t have an inside view of Suntrust’s experience. As a customer, this is the first remotely social program I have experienced. I figure that they are in the Experiments/Quest or Adoption/Obligation quadrant. What I can’t tell from her quote is whether Rilla is a believer on a quest or proud of the fact that she only spent >5% to be able to check the “social” box.