August 7, 2012 – Social media analytic programs may be driven by high volumes of content, but execution depends on internal competencies as much as service and product providers according to a new report from Hypatia Research Group.
Founder Leslie Ament calls social analytics an “exploding category” of software and service vendors that touch on categories including sentiment analysis, twitter and content analytics and speech analytics. The products are functional, replete with dashboards, drill downs and visualizations for metrics as well as proactive workflow and complex filtering.
Nonetheless, customers find themselves learning in a hype-filled market against a backdrop of new and evolving technologies where early documented users of social media analytics are often “first movers willing to make a leap of faith,” Ament says.
“We found that [qualified respondents] who took the survey were all over the place in terms of maturity,” she adds. About 30 percent are in an early stage of using social analytics and intelligence and with more than 100 social analytics vendors to choose from, many are looking for the proper selection criteria.
This is no easy process since appropriate metric and predictive analytics capability initially requires organizational understanding more than specific products. While a service-based industry for social analytics may be in the offing, companies will first have a learning process to assimilate internal competency in social analytics.
Measured ROI is elusive among companies adopting Social Analytics & Intelligence (Hypatia’s term for the category), where two-thirds of large companies could not effectively track return on investment after two years. Conversely, 23 percent reported a 2 to 3 percent return on marketing budgets based on metrics that capture customer feedback on design or merchandising, their propensity to recommend a brand and their brand’s sentiment.
Uncertainty aside, more than 50 percent of companies will spend 3 to 5 percent of their annual marketing budget on the category next year, and close to 40 percent will spend more than 5 percent. Along the way, Ament says, these organizations will need to build expertise in which business applications best fit social analytics, the social processes involved, the metrics to measure, who will be responsible and the kinds of actions that will be taken as a result.
An executive summary of the report is available for download with registration.