Wednesday, November 30, 2011

Social Media impact on business and future growth – IDC Research


2011 has seen rapid expansion of business change that is being driven by the social customer, empowered employees, and a convergence of new technical capabilities. IDC SVP and Chief Analyst Frank Gens, believes that 2011 is the year we tip from the PC/Server-dominant era to the era of Social/Mobile/Virtual (the latter effectively meaning cloud computing). The new era is driven by advances in four key technologies – social media, analytics, intelligent devices, and broadband networks. He suggests that high-value growth will result where industry-specific challenges mash up with these technology trends. Social commerce, for example merges retail + mobile intelligent devices + social. Telemedicine mashes healthcare + mobile broadband + analytics. . According to International Data Corporation (IDC), worldwide revenues for message and social media archiving applications will increase from $1.15 billion in 2011 to $2.04 billion in 2015. IDC said 62 percent of US businesses already have message archiving, and increasingly, corporations are looking to store social media data that's searchable within a data storage system.

IDC's Forecast for Management Survey, 2011, shows that over the next 12 months, more than 24 per cent of IT decision-makers will deploy social media or collaboration-type applications via platforms that allow the business to build applications in-house. Social business survey by International Data Corporation (IDC) shows that 41% of respondents have some sort of social business initiative underway. This leaves 59% who have not implemented a solution. However, these projects vary greatly – from grassroots bottom-up employee initiatives to sophisticated and strategic social customer engagement programs – as do the maturity of the businesses and their social strategies. Companies can set up all the technology and programs they want, but getting people to participate is another matter. Slightly more than 50% of companies said this was a major problem. Companies are hiring journalists, content strategists, content managers, and various influencer relations professionals among other new roles. IDC surveys show 51% of workers in the United States use social media in the enterprise. Roughly 5% are part of a corporate initiative while about 33% of employees embark on a self-directed initiative. And according to IDC data, 15% of businesses are using social media for work.

As social media matures, more tools become available for managing and while business units remain involved in picking these technologies, IT helps select and implement them. According to Michael Fauscette, an analyst at IDC, social media tools are spreading "across all departments" sales and customer service. When IDC first conducted the survey three and a half years ago, marketing dominated the results. Fauscette says social media is used internally for collaboration and idea generation, and externally for marketing and crisis response. When it comes to managing the strategy behind social media, however, marketing still rules -- it handles that responsibility at 48% of companies -- and IT isn't involved at all. Corporate communications is second, cited by 29% of the respondents as one of the departments that handles social media strategy (multiple answers were permitted). Meanwhile, 26% of the respondents named product development, 23% said customer service, and 16% cited sales. Fauscette calls this shift a sign that the social media market is maturing. He says this means the technology will begin to become part of IT's purview. IT shows up in the integration and implementation of the tools and when social media moves out of marketing's control, moves beyond experimenting then IT department will take over and look at broader perspective.

In an IDC study- Determining the Value of Social Business ROI: Myths, Facts, and Potentially High Returns states widespread industry adoption of enterprise social software is relatively immature and executives want a clearer understanding of the potential gains, costs, and return on investment that social business initiatives can have on a company’s bottom line. When conducting ROI on social business initiatives, the traditional rules of business still apply. This is regardless if a company deploys social business initiatives to assist customer service, marketing, public relations, product innovation, employee collaboration, or other functional areas of the organization. One of the obstacles to getting a clear ROI is that much of the well-publicized social media use cases have been in the area of marketing, an area where ROI is more elusive.

IDC research says that people are using social media outlets to access, distribute, share and influence the entertainment consumption of others. And that, says IDC analysts, is fostering a new "addressable" advertising category that is worth billions of dollars and growing fast. The report, "Social Entertainment 2.0: What Is It, And Why Is It Important?" estimates it will grow from $2.5 billion in 2010 to $5.8 billion in 2015, averaging 18% growth per year. And that's just in the U.S. Globally, IDC estimates worldwide social entertainment ad spending to be about twice that volume. Based on a survey of U.S. adults 18 to 34 conducted by IDC in April, the top five Internet destinations for entertainment content and news are Facebook (74%), YouTube (71%), Google (68%), Yahoo! (47%), and Hulu.com (31%). The top 5 regularly visited on mobile phones were similar: Facebook (63%), Google (45%), YouTube (39%), Yahoo! (25%), and Twitter (17%).

According to IDC’s Matt Healey, with the rapid growth of social media platforms, most enterprises are have embraced this form of communication from an outbound marketing perspective. There are few organizations that do not have a corporate Twitter account. However, using social media for outbound marketing represents only a small portion of the power of social media. Most organizations now realize that they need to monitor the conversations that are not started or controlled by their marketing departments. The problem is that traditional IT systems have not been designed to address these needs. As a result, several startups have begun to develop technology to monitor and analyze social media. As these organizations begin to mature, they will increasingly be the target of acquisition by larger SW vendors that are looking to incorporate this technology into their CRM or other enterprise applications. IDC expects that in the next few years, this type of social media analysis will move from a standalone application to an integrated part of larger systems. 2011 saw two acquisitions, acquisition of Radian6 by Saleforce.com and Twitter acquisition of BlackType. 

2 comments:

  1. Great info and ideas..It is helpful to my studies.


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