This Week's Herman Trend Alert

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  The Herman Trend Alert

August 12, 2015

Trends in Social Media

Within the next five years, social media spending at companies is forecast to increase from 9 percent of marketing budgets to nearly 25 percent, according to a recent Duke University study. However, half of those surveyed said they couldn't actually identify the specific impact social media had had on their business. That situation will soon change.

Evolving social media
Though businesses are now reaching larger audiences and seeing better results, the fact that the social media landscape is shifting is making producing and measuring consistent outcomes a huge challenge.

Emerging apps and other tools will help companies keep track
Though the use of social media by businesses is on the rise, new tools and apps are facilitating keeping track of the impact of social media spending and even measuring the return on individual Tweets and posts. Thus, this year, expect to see metrics on the Return on Investment (ROI) of social media.

Staying relevant on Facebook will cost more
Historically, Facebook used its proprietary algorithm to limit a company's reach to just 16 percent of its brands' fans. But recently a report published by researchers at the advertising giant Ogilvy showed that the number has declined to only about 6 percent and may decrease even more. Facebook is reducing the value of organic posts, because it wants companies to buy its so-called "native ads". These native ads resemble normal Facebook posts and appear in users' news streams, not on the side of the page like traditional ads. Thus more effort---and a lot more investment---will be required to generate the same response on Facebook.

Diversification will help companies hedge their bets
At the same time that companies are increasing their Facebook spending, they will also diversify their social media usage to include other channels, like Twitter, Instagram, and in China, messaging service WeChat. By diversifying, companies will reach different demographics attracted to other networks and services.

Customer service will use social media and phones together
Many service providers have enjoyed substantial benefits from using social media to help them handle customer service. Satisfaction increases and everybody wins.

Consumerization of IT
The cloud has changed the playing field for software and technology, as well as social media. Now, however, employees at all levels are looking for apps and services to help get their jobs done. "Freemium pricing" now allows access to basic versions of software at no cost. These cloud-based tools are intuitive and easy to use.

Expect young people to lead the way
As with most of the new technologies, the youngest generations will be the earliest adopters. Older people will require more time.

Special thanks to Ryan Holmes, CEO of Hootsuite, who recently wrote an article for Fortune Magazine about trends that will change how social media is used in 2015.

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