Report: Corporate World Struggles to Monetize Social Media

Global businesses are generally still clueless as to how to monetize social networking sites,  and only 10 per cent of enterprises have managed to gain expected returns on their investments on social media, shows a survey conducted by Indian outsourcing giant Tata Consultancy Services (TCS).  This year, a corporate company investment on social media would average at $19 million at the most, predicts the Indian IT giant.

Nevertheless, this figure may rise to rise to $ 24 million by 2015 because, the outsourcing firm says,  a large many consumer goods firms appear to be exploring this channel to reach out to their customers.

“Despite ready availability of digitized consumer-to-consumer interactions in social media, its use by companies is today largely limited to being a mechanism for business to consumer marketing,” noted Satya Ramaswamy, Vice President and Global Head of TCS Digital Enterprise.

He has suggested that enterprises take a multi-layered approach and learn newer methods to harness the power of social media. “Organizations need to be social and share internally to really use the power of social media externally,” he pointed out.

The company surveyed 655 respondents from mostly USD 1 billion plus consumer companies in June and July this year. “56 per cent of respondents have measured the return on social media investments and most of them say it has been positive,” the report added.

Only 27 percent of R&D and product development and 37 percent of product management departments regularly view social media comments from consumers. This is partly because social media activity is most commonly owned by marketing, customer services and sales.

Adopting a corporate culture that values consumer opinions and responding quickly to consumers’ complaints and viewpoints holds the key to be successful in social media marketing, says the outsourcing firm.

Media and entertainment industry has remained to be the biggest user of social media sites, but firms in insurance sector appear to be new to social media.