Does social media marketing work?

Does social media marketing work?

Does social media marketing work?

Does social media marketing work?

Does social media marketing work? This could literally be the million-dollar question, make that the billion-dollar question. Yeah right! We hear the naysayers, who spends a ‘telephone number’ on Facebook; well, it seems a ‘few’ will part with vast amounts of money to reach their social audiences.

In a study by eMarketer, a little over R522 billion rand will be spent on social media marketing in 2017/18, and this excludes the costs attached to the people that make it all happen. Take a look at the table below;

  2016 2017   2016 2017
Social Network Ad Spending (in ZAR Billions) Social Network Ad Spending Growth (% change)
North America 190.05 227.27 North America  25,5% 19,6%
Asia – Pacific 137.00 178.00 Asia – Pacific  30,6% 23,3%
Western Europe 87.30 102.75 Western Europe  22,8% 17,7%
Latin America 12.75 15.00 Latin America  25,0% 17,9%
Central & Eastern Europe 10.50 11.85 Central & Eastern Europe  14,4% 13,0%
Middle East & Africa 3.30 4.20 Middle East & Africa  33,9% 27,4%
   2016 2017   2016 2017
Social Network Ad Spending Share (% of total)      Social Network % of Digital Ad Spending
North America 42.4% 42.1% North America 17.4% 18.7%
Asia – Pacific 30.6% 23.3% Asia – Pacific 13.8% 14.3%
Western Europe 19.5% 19.0% Western Europe 15,3% 16.8%
Latin America 2.8% 2.8% Latin America 10.4% 10.4%
Central & Eastern Europe 2.3% 2.3% Central & Eastern Europe 9.5% 9.7%
Middle East & Africa 0.7% 0.8% Middle East & Africa 7.2% 7.4%


Lets make some sense of these numbers; with maturing social media reach, one expects a drop off in the growth of ad spend. The money spent on social network advertising is relatively stable when stacked up against some of the other indicators, with the Middle East and Africa the only region showing growth. Having said this, it is staggering to note that North America spends 42,4% of its total ad spend on social networks. Considering digital ad spend alone, all regions will see social network advertising taking a bigger slice of the budget.

Where is the money spent on social media marketing?

Unsurprising that Facebook scoops a massive 65,5% of the global social media marketing spend, and Twitter, which lags somewhat far behind, accounts for 8,8%. LinkedIn settles for 3,8%; this amounts to $900 million, which puts Facebook’s’ $15,5 billion into perspective.

how much should a company spend on social media marketing?

Another million dollar question, and there appears to be consensus on what is appropriate, broadly speaking; it differs slightly between B2B, and B2C businesses. Lets begin with marketing generally, there appears to be little consensus on what percentage of revenue should be attributed tomarketing; sure there is some variation between start-ups and mature businesses. Is there consensus on what percentage of your marketing budget should be spent on social media marketing? It would take a brave person to come right out, and give you a straight answer, so we will side step this question as well.

We can however, provide some insight into what is being done, and what indicators suggest will be done. Research in a eMarketing report puts social media marketing at 7,2% of total digital ad spend in the Middle East and Africa, and this going to grow, and if the other regions are setting the trend, we still have a long way to go.

The elephant in the room of social media marketing

Its really cool when we can draw on any number of reports from very clever people to support our budget requests for social media marketing, but what then? You see, we are quick to slate the messenger, because it is far easier than slating our own inability to take the blame for a poor message. Not surprising then, that when we ask the question; does social media marketing work? The answer is somewhat vague.

You’ve probably heard the expression; content is everything, and everything is content, well if you haven’t, you have now. And it is everything it says, and more, and if as much emphasis was placed on social media content as there is placed on other forms of digital advertising, who knows what the outcome may be. For purposes of this article we can say that; content which is relevant and engaging, will connect you to your audience.

social media marketing in the south african landscape

Surprisingly there is not a great deal of data or information on social media marketing spend in South Africa, we would like to think its because this very valuable information is safely locked away from competitors, but somehow, we don’t think so.

Perhaps herein lies the conundrum; are we looking at social media as a marketing platform, to build brand awareness, or are we looking at social media as a sales platform. Unlike television, website, or bill board advertising, the social media environment is an engaging platform, not necessarily a ‘telling’ platform. In short this means you need someone on the ‘telling end’ of the platform to be available and willing to engage with your audience. In South Africa, we may not quite have grasped the importance of engaging yet, more about this later.

lets take a look at an interesting report on the social media landscape produced by World Wide Worx and Fuseware. Granted it was released in 2014, but we can extrapolate some trends; here are the nuts and bolts of it;

  • Facebook – 9,4 million users, up from 6,8% the year before.
  • Twitter – 129% growth in 12 months to 5,5 million users.
  • Smart phones – 87% of Facebook users and 85% of Twitter users.
  • Major brands – 93% use Facebook, 79% use Twitter, 58% us YouTube, and 46% use LinkedIn.
  • Major brands – 53% will develop internal processes to manage social media, and 27% will outsource.
  • Major brands – have an average of 58 000 Facebook fans, and 12 785 Twitter followers.
  • Major brands – take 271 minutes to respond to Twitter customer issues.
  • Mxit – 7,4 million active users and 2Go has 10,5 million.
  • WhatsApp – has overtaken everyone including Facebook in terms of users.

Back to the bit about ‘engaging with your user’ and we can see why it is much easier to flight a TV ad, or slap a massive graphic on a bill board, because this means the job is done and we can all go home after a hard days work. The reality is our audience has not ‘gone home’, so to speak, they are willing to engage with your brand when ever it suits them; and this does not keep office hours. And by the way, ever wondered what the passengers are doing as cars drive past your bill board, you guessed it, they are on their smart phones.

Enough about the big brands, what about the little guys.

This is by far the majority of businesses who don’t have the luxury of allocating a few million to social media, because everyone else is doing it. These are the folk that have to wring every drop of value from their marketing budget, and for whom, many marketing and advertising opportunities are tugging at their budget.

Contributing to a report in SME South Africa; Scott Cundill and Raksha Mahabeer broadly concur that entrepreneurs with a R100 000 budget should look at building a communication strategy and channeling this through Google (Adwords), and social media like Facebook and Twitter. It is also interesting to note that for someone with a budget of R10 000, attention should be placed on; search engine optimization, email communication, and social media activity.

Social media marketing case studies.

We can count actual sales derived directly from social media marketing, and for evidence of this we looked at a few examples from clients of Core Business Elements. All of the examples commenced with social media marketing within the last 12 months, and all are small businesses. What value can be placed on the awareness that each brand as achieved? This is a question above our pay grade, and is best left to the folk who make a living out of valuing brands.

  Sector Facebook Fans Twitter Followers Investment ROI
Company 1 (12 months) Business Consulting 9014 6919 R14,900 R179,210
Company 2 (12 months) Travel Destination 8183 3904 R8,940 R294,340
Company 3 (3 months) Travel & Tourism 5884  4413 R2,235 R137,500

SO, does social media marketing work?

The short answer is; yes, social media marketing does work. But, until this valuable marketing AND SALES platform is taken seriously, the naysayers will leave it languishing in the bin of unsuccessful business tools. It cannot be over emphasized that the messenger is only as good as the message, and it is when the message is given careful thought, that the messenger will do its job.

Sources: eMarketing, World Wide Worx, SME South Africa, Business 2 Community, and Core Business Elements.

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