Part 2 of the Sensis Report has arrived!
In this second part, we take a look at the use of social media by Australian business.
Overall, there has been a decline in the budget and use of social media by business. Yet, as we saw in the key takeaways from part one of the Sensis Report, the growth in use by consumers has grown with over 79% of Australians active on social.
So what is happening, why are business failing to take social on board as part of their marketing strategy? Let’s dive into Part 2 of the Sensis Report!
Less of a presence
Despite the rise in social media use by consumers since last year, the use of social media amongst businesses has reduced.
Large businesses had the greatest decrease, dropping to 60% from 79% in 2016. The use by small and medium businesses has also dropped slightly since last year with just under half having a presence on social media.
Interestingly, 40% of the large businesses not using social media said they had previously had a presence, compared with 8% of small business and only 1% of medium businesses.
State by state
Year on year, there has been a healthy adoption of social media by across Australia. In 2017, 47% of small to medium businesses have a presence on social media.
The Northern Territory had the biggest growth with a 10% increase from 2016, and at 55% usage is above the national average. Sitting just behind the NT are NSW (51%) and Queensland (50%). Western Australian is sitting on average at 47% after a growth in use of 8% since last year.
Platform use
For businesses of all sizes, Facebook was the most widely used platform, around 9 in 10 businesses are using it for their marketing.
93% of large businesses in Australia have a Facebook presence
LinkedIn was the next most popular for each category, Twitter also appeared in the top four for each.
Hospitality and social
On average, 47% of small to medium businesses have a social media presence. Among the businesses surveyed, those in the hospitality industry had the biggest social media presence.
70% of small to medium businesses in the hospitality industry have a social media presence
The next industries to have a strong presence are Cultural, Recreational and Personal Services (66%) and Retail Trade (58%). While both of these have dropped since last year 77% and 61% respectively, the use by those in hospitality has increased from 60% in 2016 and 45% in 2015.
In comparison, the industries with the lowest adoption rates are Transport and Storage (27%) and Finance and Insurance (32%).
Looking for value
Of those surveyed that don’t have a social presence, one in two small businesses said they were unable to see the benefit. 63% of medium and 65% of large businesses also listed this as a reason for not being on social.
Only 11% of medium businesses and 9% of small businesses without a social presence are intending to create one in the next year.
Time is also a factor. Of large businesses resisting to have a presence, 70% say it takes too much time. Another 48% stated not understanding social media as their reason for not having or intending to have a social presence.
However, among the large businesses that use social none see it as a time waster. The biggest frustration among businesses using social is in the creation of new content and ads.
Marketing and communication
The main reason given for using social media amongst the small and large businesses surveyed was to advertise and promote.
42% of large businesses use social primarily to promote and advertise
However, amongst medium businesses, the most popular reason stated was as an avenue for contact and interaction (35%). This was also an important factor for large (22%) and small (26%) businesses.
Medium businesses also placed a greater importance on posting photos and videos (13%) than the other groups, while large businesses felt it more important to have a presence (13%) and promote sales/special deals (15%) than the other two.
Talking to customers
There has been an increase in businesses of all sizes using social media as a means of communication. Businesses are encouraging their customers to use social to provide feedback, reviews and comments more so now than in previous years.
This is especially true of large businesses with 92% of those surveyed stating they did, compared to 66% in 2016. Small and medium businesses are a little less inclined but still over half of them are encouraging, 60% and 52% respectively.
The other great improvement is the number of businesses that are responding to their customers on social.
93% of large businesses interact with customers who provide feedback on social
There was a slight drop in the amount of medium business who do this from 2016, but both small and large business have increased their interaction.
Management of social platforms
The majority of businesses surveyed manage their social media internally rather than outsourcing to an agency.
When outsourcing, employing the services of digital, web or internet agencies was the most popular choice for all groups that were surveyed and the only one used by large businesses.
Specialist social media agencies were only employed by small businesses (21%), while PR, communications or media agencies were a common choice for medium businesses (41%).
There was a significant increase in the use of marketing departments by large businesses to manage their social, rising from 53% in 2016 to 85% this year. 33% having allocated to communications previously, it is now only 2%.
Owners and managers are responsible for social in 10% of large, 24% of medium and 70% of small businesses.
Not surprisingly, it is the owners and managers of small businesses that are responsible for the social presence (70%) only 17% have a marketing department. Both of these have risen since 2016.
Large businesses are the most frequent at posting on social media, 88% of those surveyed post daily. This number drops when looking at the daily posting of small (36%) and medium business (34%) who are more inclined to post weekly or a few times per week.
Marketing budgets and social
A large percentage of the business surveyed did not have an allocated budget for social media marketing or were unable to respond. Though of those that did, there was a trend for an increase in budget from previous years.
The biggest increase is by large businesses, who have almost doubled their allocation to social. But there has also been a decline in the annual amount spent.
In 2017, 80% of large businesses had a social media budget of A$1000- $5000. In 2016 the average was A$5000- $10,000.
For each group, the average annual social media budget has dropped substantially. Though in each case social advertising received the largest allocation, ahead of content and strategy services.
Though most commonly used by large business, businesses of all sizes are using paid advertising on social media.
Around 70% of small and medium businesses have found it effective to advertise on Facebook
Facebook is the most popular platform to use, followed by LinkedIn for small and large businesses and Instagram for medium size businesses.
Strategy and success
There has been an increase in the development of a strategy for social in each group. Last year 76% of large businesses had a strategy in place, that has risen to 90%. Only around 1 in 4 small and medium business have a strategy.
Businesses are still placing value and emphasis on the number of likes, followers and subscribers. Large businesses more so than the other groups and the number that use it to measure their success has actually increased by 20% from 2016 to 95%.
It is also interesting to note that the majority of large business surveyed do not believe social will contribute to sales, conversely 53% of small and 73% of medium businesses do think it will.
Conclusion
So, if consumers are using social why aren’t the businesses using social to market themselves becoming better and more prolific?
We know that algorithms have a great effect on the way we see things on social and pushing everyone to pay for advertising. Is it fair to then speculate that a lack of budget is restricting businesses from using social, in particular, the small and medium businesses that are also restricted with time?
What are your thoughts, why do you think social media has become more popular with consumers and less with businesses in Australia? Leave us your thoughts in the comments below.
For more on how consumers are using social in WA check out the first of our Sensis 2017 articles, or head over to the Sensis site if you’d like to see the full report.
