Marketers’ struggles measuring social’s ROI are well-documented. But here’s another sobering view from the top: according to the latest CMO Survey [pdf] released by Duke University’s Fuqua School of Business, just 15% of CMOs in the US can confidently say they have quantitatively proven the impact of social media on their business. By contrast, 49% haven’t been able to show the impact yet, and the remaining 36% have a good qualitative – but not quantitative – sense of the impact. Respondents were asked to choose which answer best described how they show the impact of social media on their business.
Given current spending levels on social media outlined in the study, the results indicate that CMOs are allocating 6.6% of their overall marketing budgets to a channel which only 15% can confidently measure on a quantitative basis.
CMOs are clearly having a harder time measure the impact of their social efforts than of their overall marketing spending. Separately in the study, 36.3% of respondents said they can prove the short-term impact of their marketing spending quantitatively, while 31.7% concurred with respect to the long-term impact of their overall marketing spending. (While CMOs clearly have a better quantitative grasp of overall marketing spending than just their social efforts, it should be noted that the proportion who claim to quantitatively prove the impact of their marketing spend is also quite low.)
Interestingly, while CMOs have been bullish about social media spending in past iterations of the survey, they seem to have softened their stance in the latest results. Current levels of social media spending (6.6% of total marketing budgets), for example, lag reported levels from this time last year (7.6%). Similarly, the share of marketing budgets expected to be allocated to social over the next 12 months has declined from 10.7% to 9.1%, as has social’s share of spend expected in the next 5 years (from 18.8% to 15.8%).
The results also suggest that CMOs aren’t following through on their spending plans. In August of last year, they projected that they would be spending 10.7% of their budgets on social media by this time, while their reported spending share has actually decreased to 6.6% over that time frame.
Sorting by company types, the study reveals that current social media spending is highest for B2B services companies (7.8% of marketing budgets), though that figure is down from 9.6% in February of this year. B2C services companies expect to devote the largest share of their budgets to social in the next 12 months (10.7% share), while B2C product companies are the most bullish when it comes to spending in the next 5 years (19.5% share).
Along with measurement problems, social media continues to be poorly integrated in firm-wide marketing strategies, according to the researchers. In this latest survey, the mean integration score (on a 7-point scale, where 7 represents “very integrated”) was 3.9, barely above the 3.8 level it has been stuck on for the past 4 surveys.
With integration still problematic, and quantitative measurement limited to a select few, perhaps it shouldn’t be a surprise that spending levels have taken a step back.
About the Data: The CMO Survey is conducted online twice a year. The latest survey was fielded from July 16 to August 6, 2013. The survey had 410 respondents, of whom 93% were VP level or above.