Syncapse Increasing Campaign Effectiveness With Social Media

©2011 Syncapse Corp. All rights reserved. www.syncapse.com

INCREASING CAMPAIGN EFFECTIVENESS WITH SOCIAL MEDIAMARCH 2011

™

facebook.com/syncapse @syncapse

©2011 Syncapse Corp. All rights reserved. www.syncapse.com 2

EXECUTIVE SUMMARYThere should be no doubt that social media is growing in popularity and taking a bigger share of consumer mindshare. In trying to separate the hype from the reality, many marketers and brand managers are struggling to understand what level of investment should be made in social channels. To help them, Syncapse conducted an extensive study of more than 4,300 consumers across North America.

We expected to find that social was quickly becoming an important part of the consumer decision-making process. From our experience working with leading global brands to identify and manage their social media audiences, we have seen anecdotal and quantitative evidence of brands that integrated social media into their marketing campaigns gaining a clear advantage over their competitors. But what we learned surprised even us.

Through our survey, we found that consumer behaviour is evolving quickly. Television is no longer the main focal point of media attention in the home. A growing number of consumers are spending more time online than watching TV. Many do both at the same time.

Consumers are also looking to social media as a source for trusted brand recommendations: friends and family use social networks to comment on brands; many blogs have gained trust with their audiences; and Facebook brand sites are increasingly becoming a destination for savvy consumers.

Indeed, social media has clearly become a very effective way to drive consumer awareness and campaign effectiveness. But our survey went one step further. We identified a critical segment of the social media audience who carry a disproportionate level of influence on consumers. This group, who we call Social Media Producers, also tend to spend more on the brands they recommend. Activating this segment of the consumer audience will provide incremental benefits to those brands that understand how to engage consumers through social channels.

For marketing and brand managers, the lesson is clear: campaigns that incorporate a level of social media investment will be more effective. And those that focus on moving their social membership base up the value chain will find even greater returns on their investments.

Syncapse is pleased to share these findings. We believe this data demonstrates that, by investing in social media, marketers and brand managers can increase their campaign effectiveness and achieve a greater proportion of positive brand recommendations.

But every brand is unique, and so we encourage you to contact us to learn more about the segments of the social media audience that carry the most influence with your brand. You may be surprised by what you find out.


SUMMARY OF KEY FINDINGSSocial media is increasingly pulling mindshare away from traditional advertising and forming new influencers that will become an increasingly important target segment for many marketers.

The Producer segment can deliver $22.93 in earned media value per recommendation for brands that engage in social media campaigns.

45% of consumers watch TV and surf Facebook at the same time.

40% of respondents factor in Facebook recommendations when making purchasing decisions.

Consumers are equally likely to trust a recommendation from a blog as a television spot.

Producers spend almost 20% more on the brands they recognized than Participants.


AUDIENCE SEGMENTATIONBased on their self-identified media use, respondents were categorised into five audience segments:

Producer 13.7%Creates and distributes new content through socialnetworks, blogs and online discussion forums

Engager 24.9%Engages brands and interest groups in collaborative discussionson social networks, blogs and online discussion forums

Participant 28.4%Maintains and updates profiles on social networking sites

Lurker 19.7%Reads blogs and online discussion forums and follows friendsand family discussions and updates on social networks

Abstainer 13.2%Does not actively participate in social networking


TV IS STILL KING, BUT SOCIAL IS INCITING REVOLUTION

Across a number of key demographics, consumers are spending less time watching television and more time participating in online forums such as social networking. And while almost 30% of respondents report spending more than 20 hours watching television and more than 20 hours online per week, almost one in five say they now spend significantly more time online than in front of the television.

For marketing and brand managers, these findings point to a fragmentation of consumer mindshare and an increasing need to deploy multi-channelled initiatives that bring together television and online sources to engage customers and reinforce brand messaging.

The following chart clearly illustrates the propensity of consumers to split their media time between traditional and online sources.

18% of all consumersspend more time onlinethan watching TV.

Lessthan 8 9 to 15 16 to 20 21 to 30

31 ormore Total

10 or less

Online Hours / TV HoursCrosstabulation

Count % within TV hours

TV Hours per Week

Onl

ine

Hou

rs p

er W

eek

26228.4%

10714.1%

9311.1%

11111.2%

799.9%

65215.1%

10 to 19242

26.3%277

36.4%223

26.7%219

22.0%102

12.8%1063

24.7%

20 to 24 13214.3%

15320.1%

20424.4%

23623.7%

10913.6%

83419.3%

25 to 35 11312.3%

10714.1%

15218.2%

21421.5%

15719.6%

74317.2%

36 or more 17218.7%

11715.4%

16419.6%

21521.6%

35244.1%

102023.7%

Total 921100%

761100%

836100%

995100%

799100%

4312100%

Source: Syncapse Corp. 2011


Research also shows that consumers are not fully engaged when watching television. When asked about their activity during popular television shows, half admitted that they had only paid partial attention to the Super Bowl, while other top rated weekly programs captured significantly less attention. For example, only 47% gave Grey’s Anatomy their full attention and less than one in three paid full attention to The Biggest Loser. At the same time, new technologies such as PVRs and time-shifting are creating even greater pressure on television and making it increasingly difficult for brands to capture mindshare though traditional broadcast media strategies.

ATTENTION SPANS SHRINK

Only 47% of all those watchingGrey’s Anatomygive it their fullattention.

% who hadfull attention

Television Show % who hadsome attention

Superbowl

Glee

America

NCIS

Big Bang Theory

Grey’s Anatomy

The Office

Modern Family

Bones

The Biggest Loser

50.8%

45.3%

40.2%

57.5%

55.3%

47.5%

38.6%

45.2%

49.9%

31.1%

49.2%

54.7%

59.8%

42.5%

44.7%

52.5%

61.4%

54.8%

50.1%

68.9%



So what is pulling audience attention away from the television? Significantly, nearly 45% of respondents admit that they surf Facebook while watching their favourite shows. This is especially evident among those that both watch high levels of television and spend a significant amount of time online: 52% of this audience segment multi-task between television and Facebook versus almost 40% of those with lower consumption of television and online content.

The message for marketing and brand managers is that social networks are commanding increasing levels of consumer attention. And given that social network participation tends to demand a greater level of active involvement (as opposed to passively watching television), one can infer that even those that split their time are generally more absorbed in their social networking activities than television.

This research suggests that consumer brands can achieve a greater number of impressions – and a larger share of the audience attention – by integrating social media initiatives into their advertising strategies. And while neither television nor social networks command complete audience attention, it is clear from the data that marketing teams who effectively combine both stand to gain greater mindshare within their target audience.

SOCIAL NETWORKS GAIN MINDSHARE

Nearly 45% ofconsumers surfFacebook whilewatching TV.

How much, if at all, does each of the following statements describe you?You often watch TV and surf Facebook at the same time.

Describes youcompletely

Describes yousomewhat

Does not describeyou at all

Total

891

986

2312

4189

21.3%

23.5%

55.2%

100.0%

Frequency Valid Percent

VALID



It goes without saying that positive recommendations from trusted sources can provide a substantial lift to a brand’s reputation and a consumer’s likelihood to purchase. This data demonstrates that social media forums are gaining significant traction as a source of trusted recommendations.

In our study, an equal number (61%) of respondents suggested that they were just as likely to take a positive recommendation from blogs as they were from television.

But the most trusted source for recommendations is friends and family, with 84% of respondents saying that a positive recommendation from this group influences their purchasing decision. And since most of those trusted connections now participate together in social networks, it is not surprising that almost 40% specifically cite Facebook as a source of trusted recommendations.

RECOMMENDATIONS RULE THE NETWORK

% who say a positiverecommendation would

make a difference

Medium

Friends & Family

TV Coverage

Websites or Blogs

Facebook

Twitter

84.0%

61.6%

61.3%

39.3%

15.9%


Blog postsinfluence thepurchasingdecisionof 61%


One segment of this audience demands particular attention from marketers: the Producers. Characterised by their multi-channelled use of social networking vehicles, Producers tend to check Facebook on a regular basis, post updates and comments onto their friends’ and family’s Walls, maintain active blogs and regularly tweet. In fact, half of all Producers tweet weekly or several times a week, and 42% tweet on a daily basis. At the same time, a whopping 82% of Producer respondents said they were regular or frequent bloggers. Producers are also more likely to post to brand pages or become fans of brands on Facebook.

In fact, Producers offer marketers a substantial earned media value (EMV), as their engagement with the brand has the capacity to disseminate messages and recommendations across a wide and diverse network through blogging, tweeting and fanning brand sites. In fact, it is possible – by virtue of publishing in multiple locations as is the case with blogs that are tweeted and shared through Facebook – for Producers to garner 2,000 impressions with a single recommendation.

At the same time, marketers must be cognizant that the same Producer influence can be brought to bare for negative recommendations: Producers who become net detractors for brands carry equal weight to those who are net promoters. For marketers, it becomes acutely important to not only identify Producers, but also effectively manage the relationship to mitigate negative impressions.

The following chart demonstrates the EMV of the various audience segments based on conservative monetisation models*.

TARGET PRODUCERS TO DRIVE IMPACT

Positiverecommendationsfrom Producers isequivalent to $22.93in earned media value


Abstainer Lurker Participant Engager Producer

$0 $1.07 $1.94 $4.48 $22.93

Probable earned media value per recommendation.

* Earned Media Value is based on number of probable impressions generated given a set of reported activity. For instance, 11% of Producers with a Smartphone post four or more times to Facebook a day, which can generate several hundred impressions in return. A blog post may also be indexed or curated (through online services such as Reddit or HN), thereby generating thousands of additional impressions.


Based on these findings, it is clear that Producers provide incremental benefits from an EMV perspective, but they can also directly impact the brand’s bottom line as consumers.

Simply put, Producers tend to spend more on brands they recognize than their peers. To demonstrate this relationship, respondents were asked about their impression, likelihood to recommend, and spending patterns for a list of known brands in two main categories: beer and mobile devices.

In the beer category, the data found that respondents from the Producer audience segment spend – on average - $14.56 more per month than their peers in other segments, representing a 40% increase over the monthly spend reported by all other respondents. This finding takes into account the fact that Producers tend to be younger than the average respondent (and therefore more likely to consume greater quantities of beer), and somewhat more affluent (also a driver for buying premium beer brands)*.

Looking at propensity to spend on mobile devices, Producers were also found to spend $10.76 more per month than other respondents to the survey. Again, these findings are controlled to account for the fact that Producers tend to use Smartphones (which carry a higher data charge) and enjoy a higher household income (which directly relates to the sophistication of the device)*.

However, no similar relationship was found to exist for television watchers. And while it is broadly agreed that television viewing increases the number of positive impressions and enhances brand recognition, these findings demonstrate that – even after considering errors related to self-reported TV hours – no statistically relevant correlation could be found between the number of hours watching TV and increased spending on key brands.

These findings demonstrate that social media initiatives directly impact the spending habits of the Producer segment in a more significant way than television advertising alone.

SOCIAL DRIVES PURCHASE BEHAVIOUR

* Observed co-linearities were found to be within tolerance. While other factors may enhance or diminish the claim, none were found at the time of publishing.

Producers spend $10.76 moreon mobile devicesand $14.56more per monthon beer thanaverage consumers.


According to research conducted on behalf of Syncapse in 2010, Facebook fans spend, on average, $71.84 more on products for which they are fans compared to those who are not fans. The same study also demonstrated that fans were 41% more likely to recommend a fanned product than non-fans.

This most recent study found that – across all audience segments – a substantial 15% had already ‘liked’ or ‘fanned’ one of the 33 brands identified in the survey. Looking closely at these numbers, however, respondents who were categorised as Lurkers and Participants unanimously (100%) reported that they either never post on brand sites, or did so infrequently. Conversely, 89% of the Engager segment and 94% of the Producer segment said that they post to brand sites once a month or more, and more than half of the Producers admitted to posting on brand sites several times a week.

Given their reach and influence, serious attention must be placed on creating brand fans, particularly within the Engager and Producer groups.

CREATING FANS AND DRIVING SALES


Never to less than oncea month

Producer

% w

ithin

Pro

duce

r/En

gage

r

306.1%

1 to 4 times a month 20341.2%

Several times a dayto several times a week

26052.7%

Total 493100%

Engager

10111.3%

57964.7%

21524.0%

895100%

How often do you post to Facebook brand pages

89% of Engagersand 94% ofProducers post onbrand Facebook


But converting Engagers and Producers into fans is only half the job. Brand managers can also enhance the value of their social network initiatives by helping to evolve Lurkers and Participants into Engagers and Producers.

This study shows that a consumer’s likelihood to accept recommendations from sources such as Facebook, Twitter and blogs dramatically increases as individuals become more active in online and social network forums. As can be expected, those that are classified as Abstainer are extremely unlikely (7 percent) to take Facebook recommendations, versus almost a quarter of Lurkers and 42% of Participants. As consumers mature in their social media activity to become Engagers and Producers(which describes almost 40% of respondents), these numbers skyrocket to 56% and 74% respectively.

A growing number of marketing and brand managers are leveraging innovative software solutions to identify Engagers and Producers and efficiently prioritise and measure their relationships. The Syncapse Platform™, for example, has connected brands with millions of high-value consumers globally and has delivered tens of millions of dollars in earned media value in the process. And by utilising the Syncapse Platform to build, manage and measure their digital customer relationships, marketers are increasingly able to respond to these important audience segments ahead of their competitors and increase the impact and EMV of these influential groups.

EVOLVING THE SOCIAL MEDIA AUDIENCE

74% of theProducer segmentare influencedby Facebook

Abstainer Lurker Participant Engager Producer

Friends or Family 83.7%

Online message boards 29.6%

Coverage on TV 64.7%

Website and Blogs 51.2%

Facebook posts or comment

Twitter

7.4%

7%

81.7%

34.8%

56.6%

53.9%

22.1%

7.8%

85.1%

41.7%

56.5%

61.6%

42.1%

8.6%

83.9%

49.1%

63.7%

66.4%

56.4%

16.5%

88.2%

74.2%

74.4%

85.4%

73.8%

58.7%

% who say a positive recommendation from each source would makea difference in final purchase decision.



CONCLUSIONS Clearly, social media is capturing a significant amount of consumer mindshare. And since many consumers surf social networking sites while watching television, brands will quickly find that social must become a critical component of the marketing mix.

But it is the coveted Producer segment of the population that represents the greatest opportunity for brands: 42% are frequent bloggers, more than 50% tweet at least once a week, and almost 75% factor in Facebook recommendations when making a purchasing decision. In effect, this group is worth $22.93 per recommendation in earned media value for brands that can successfully court them.

Across all audience groups, almost 40% of respondents say that a positive recommendation from Facebook would make a difference in their purchasing decisions; 61% say the same about blogs.

For marketing and brand managers, three important conclusions can be made from this research:

Social media must be an integrated and incremental component of any marketing campaign;

Heightened focus must be placed on interacting with social media Producers and turning them into fans; and

Greater effort must be put towards evolving audiences to become Producers.


METHODOLOGYThe quantitative research supporting this Syncapse study and analysis was conducted by Hotspex Market Research between February 15th and 17th, 2011 using their online panel. More than 4,300 panellists responded across North America representing a broad variety of demographics, household incomes and social media utilization. Approximately three quarters of respondents identified their country of residence as the United States and a quarter Canada.

Respondents were asked to verify their familiarity with a number of popular brands in each category in their marketplace and then to provide their impressions of each brand, as well as their likelihood of repurchasing and recommending the brand to friends and family. The survey went on to ascertain the respondent’s online, social media and traditional media habits, including their use of popular social media sites such as Facebook and Twitter.

Syncapse analysed the data utilizing the Syncapse Platform™, a proprietary global solution for understanding social media value and business drivers.

The market segmentation definitions and composition contained herein are based solely on Syncapse research. The authors would like to acknowledge the groundbreaking work of Forrester Research in the area of Social Technographics®, details of which may be found at http://www.forrester.com/rb/Research/social_technographics%C2%AE/q/id/42057/t/2.


ABOUTSYNCAPSEFounded in 2007, Syncapse Corp. has quickly become a global technology leader in social media management by delivering solutions that empower brands and agencies to build, manage and measure their digital customer relationships. A member of Facebook’s Preferred Developer Consultant program, the Syncapse Platform has connected brands with millions of consumers globally, delivered tens of millions of dollars in earned media value and has been recognized as one of the top social technology providers for brand marketers. In 2010, Syncapse was named to the ranking of PROFIT Magazine’s HOT 50 Emerging Growth Companies, a member of Deloitte’s Tech Fast 50 Companies-to-Watch, winner in the Emerging Entrepreneur category in the Ernst & Young Entrepreneur of the Year® Awards and one of North America’s 50 Most Engaged Workplaces.

Syncapse™ and Syncapse Platform™ are trademarks of Syncapse Corp. in the United States and/or other countries.

To learn more visit syncapse.com

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Syncapse Increasing Campaign Effectiveness With Social Media

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