The share of marketing budget allocated to social media marketing is getting larger. The results of a survey of more than 400 top marketers conducted by the American Marketing Association and Duke University’s Fuqua School of Business indicate a significant increase in the marketing budget spending on social media.
According to this survey, currently marketing budget spending on social media is 5.6%. The percentage is likely to increase to 9.8% over the next 12 months and reach 18.1% over the next 5 years. The survey also indicates that the increase is likely to be bigger among service companies than their product-focused counterparts. This is in contrast to the results of August 2010 CMO survey in which product-focused companies indicated higher increases.
Current social media marketing spending is 3.5% and 4.6% for B2B and B2C respectively in product companies, while it is 6.9% and 8.8% for B2B and B2C respectively in service companies. Both product and service companies are likely to increase spending significantly over the next five years with service companies in the lead.
In spite of the increasing budget allocations, effective integration of social media marketing in the overall marketing strategy is still a work-in-progress. Among the survey participants, only 6% feel that social media is very effectively integrated with the overall marketing strategy, while 25% feel that the integration is not at all effective.
With the increase in social media marketing budgets, it is essential that marketers find ways to effectively integrate this platform with the overall marketing strategy to increase efficacy and make it more cost-effective.