Only 10% of enterprises has realised significant improvements to its business as a result of social media investments.
According to the global trend report titled Mastering Digital Feedback: How the best consumer companies use social media by Tata Consultancy Services, while social media is being taken seriously by most enterprises, nearly two thirds have at least one full-time equivalent (FTE) committed to social media.
The average company will spend $19 million on it and employ 56 people; significant benefits are not being achieved most commonly due to information not reaching the right functions.
Despite ready availability of digitised consumer-to-consumer interactions in social media, its usage by companies today is largely limited to being a mechanism for B2C marketing.
Satya Ramaswamy, vice president and global head of TCS Digital Enterprise, said, it is time enterprises took a multi-layered approach to social media and learnt to harness its power across the enterprise in critical revenue drivers such as new product design by incorporating feedback from social media in these important business functions.
“Breaking down the organisational silos is key to realising the full power of social media. In other words, organisations need to be social and share internally to really use the power of social media externally,” added Ramaswamy.
Other significant findings from the research were:
– Only 27% of R&D/product development and 37% of product management departments regularly view social media comments from consumers. This is partly because social media activity is most commonly owned by marketing, customer services and sales. The result of siloed ownership is that only 42% of enterprises view their organisational structure for social media activities as effective or highly effective.
– Leaders spend an average of $28 million on social media activity; twice as much as laggards5. Leaders also go beyond just having company pages on social networks; 81% have corporate blogs, 77% have mobile apps for consumers who use social media, and 61% have online video channels.
– Despite only a small percentage of enterprises seeing significant business benefits, businesses are often getting a positive ROI for social media activity, 38%; that is more than double the number of companies with a negative ROI. However, 44% of enterprises have not measured ROI at all.
– The media and entertainment industry has the highest percentage of companies that have been using social media the longest to engage with consumers; most insurance companies are relatively new to social media.
– Maturity correlates with how effective enterprises are at breaking down siloes, a key factor in successful social media activity. Media and entertainment enterprises are least likely to centralise activity; whereas new comers to social media like travel, high-tech and telecoms enterprises are most likely to centralize their social media activity.
TCS surveyed 655 enterprises globally with average revenues of $15.6 billion and is the fourth TCS global trend report in the series.