Brand Executives Say Online Communications a Must in Generating Consumer Loyalty, but Many Question Value of Social Networking
SAN DIEGO – Tweeting and Facebooking may be the rage among the YouTube generation, but many corporate leaders are reluctant to change their marketing approaches for the sake of social networking, according to a new national survey. Most corporate brand executives believe they are better served by effectively utilizing online communications and traditional public relations activities in order to build brand awareness among consumers — their key objective.
Seventy percent of brand experts say they cannot successfully manage their brands without an effective online strategy and more than two-thirds (68 percent) characterize online communications as the most valuable vehicle for generating awareness and brand loyalty among consumers. Most feel their own Web sites are the key vehicle for reaching consumers and building loyalty.
Opinions are split on the marketing effect of social media, however, according to a survey of brand executives commissioned by MiresBall, a West Coast-based brand design firm, and conducted by Washington, D.C.-based KRC Research.
While approximately half (52 percent) of those surveyed see social media as a way to build brand awareness among consumers who were previously unreachable, and more than a third (35 percent) believe that social media is making it easier to create customer loyalty, nearly as many (30 percent) disagree that building customer loyalty has become easier because of social networking.
At the same time, four in 10 (41 percent) of those surveyed feel the impact of social media is not serious enough to lead to a change in brand strategy, while roughly the same number believe that social media presents new challenges for protecting a brand’s integrity, challenges that necessitate a change in strategy.
“It may indeed be hip to tweet and make Facebook friends for companies with newer brands looking to build awareness quickly, but many owners of established brands are not convinced that social networking on its own is the magic bullet for building customer loyalty,” said Scott Mires, Principal and Creative Director, MiresBall. “Simply building awareness is not enough today. What consumers are told — and how they respond — are most important.”
“Social media could be the next frontier for brand communications since nearly 80 percent of brand leaders expect to use it in their brand building activities in the next two years, but for now, marketers are struggling to figure it out,” said John Ball, Principal and Creative Director, MiresBall. “In the meantime, brands that continue to share authentic and relevant stories with their audiences — regardless of the vehicle — will continue to connect more successfully with their audiences.”
Other survey highlights:
– The top three challenges facing brands today are pricing pressures, lack of brand awareness and rise of strong competitors;
– Traditional public relations activities provide the best value for time (48 percent strongly agree) and money (35 percent strongly agree) invested for brand building, while fewer respondents said advertising produces the best value for time (31 percent) and budget (24 percent) dedicated to brand building;
– Respondents said that online communications provide the best return on the money spent managing their brand (68 percent), followed by public relations/promotional events (56 percent) and social media (40 percent).
Nearly half of marketers surveyed agreed that the economic downturn made it more difficult to create brand loyalty (48 percent), while just over a third (35 percent) used the downturn to their advantage.
“The research shows that brand managers are still trying to navigate through enormous challenges in the marketplace while simultaneously building a new foundation for brand growth, mixing both old and new strategies in hopes of strengthening their brand,” said Peter Shafer, Chief Executive Officer, KRC Research.
For the full report and a 60-second video, go to: http://www.miresball.com/Think/Survey
The 2010 State of the Brand Report included interviews with 189 company owners, senior executives and brand managers, among others. Survey participants represented small, medium and large companies with revenues ranging from $10 million or less a year (37 percent) to more than $1 billion annually (22 percent). Sixty-one percent represented corporate or institutional brands while 39 percent represented product brands. Those surveyed were drawn from firms in two dozen industries including manufacturing, technology, healthcare, energy, entertainment, travel & hospitality.
About MiresBall
MiresBall is a West Coast brand design firm that develops the strategy, narrative, and visuals to help companies from innovative start-ups to established global leaders communicate with clarity and authenticity. For more information visit www.miresball.com.
About KRC Research
KRC Research is a leader in communications research. Our ability to use research to improve communications outcomes — from public relations to public affairs to advertising — sets us apart from traditional research firms, as does our approach, which is creative, practical and fast. Our specialties include research among hard-to-reach audiences, research to drive media attention, branding and reputation research, and public policy research. KRC’s clients include Fortune 500 corporations, trade associations, and non-profits.
