7 statistics that prove the importance of social media marketing in business
Digital transformation is in full swing. Accelerated by the events of 2020, this wave of transformation marks a turn of the tide in how businesses and consumers view, use and value social media—and we’ve got the data to prove it.
The Harris Poll, on behalf of Sprout Social, surveyed more than 1,000 US consumers and 250 business executives to better understand how they use social media, the importance of social media marketing, social’s impact on organizations and how its influence will change in the coming years.
For businesses wondering when to start making greater investments in social, the time is now. The sooner you start embracing social media as a critical business function, the farther the strong social current will take you. Companies that fail to do so risk being left behind.
1. 55% of consumers learn about new brands on social
In the age of streaming, we don’t need to watch or listen to ads anymore. We can fast forward, change the channel or take our pick from an infinite library of commercial-free content. On social media, however, ads and brand content live in or next to a social stream and look a lot like the content we consume from our friends, family and other connections.
Why it’s important
When we look closer at the 55% of consumers who learn about new brands on social, Gen Z and Millennials are especially likely to use social for brand discovery. As the spending power of these digital natives increases, the size of social networks will also continue to grow, reaching over 243 million social network users in the US by 2025. If your brand isn’t poised to capitalize on the growing networks, those consumers are most likely going to discover your competitors first.
Results And Discussion
The validity test is conducted by calculating the Pearson correlation value. The statements in this questionnaire can be said to be valid if the correlation coefficient is ≥ 0.03 (Sugiyono, 2018). Displayed in the Table 2 below are the validity test results.
| Table 2: Validity Test Results | ||||
| No. | Variable | Indicator | Correlation Coefficeint | Description |
|---|---|---|---|---|
| 1 | Social Media Usage (X) | X1 | 0.891 | Valid |
| X20 | 0.902 | Valid | ||
| X3 | 0.843 | Valid | ||
| 2 | Perceived Value (Y1) |
Y1.1 | 0.692 | Valid |
| Y1.2 | 0.764 | Valid | ||
| Y1.3 | 0.589 | Valid | ||
| Y1.4 | 0.701 | Valid | ||
| Y1.5 | 0.757 | Valid | ||
| Y1.6 | 0.639 | Valid | ||
| 3 | Business Performance (Y2) |
Y2.1 | 0.889 | Valid |
| Y2.2 | 0.851 | Valid | ||
| Y2.3 | 0.740 | Valid | ||
Table 2 shows that all the indicators of the social media usage variable, perceived business value and the business performance variable all have Pearson Correlation values of greater than 0.30. Thus, it can be explained that all the indicators of the variables are valid research instruments.
The reliability test shows how far the measurement tools can be trusted or relied on. This test is conducted on the instruments by assessing the Cronbach’s Alpha coefficient. If it is greater than 0.60, the instrument used is deemed reliable. Displayed in the Table 3 below is the reliability test result.
| Table 3 :�Reliability Test Results | |||
| No. | Variable | Cronbach Alpha | Description |
|---|---|---|---|
| 1 | Social Media Usage | 0.926 | Reliable |
| 2 | Perceived Value | 0.839 | Reliable |
| 3 | Business Performance | 0.740 | Reliable |
Table 3 shows that the three research instruments, namely the usage of social media, perceived value, and business performance, have a Cronbach Alpha coefficient of greater than 0.60. Thus, it can be concluded that all the indicators of the variables in this research are reliable, and can be used as research instruments.
To determine the overall assessment on the research variables, the average scores are used with the the following criteria: 1.00-1.79 = Significantly Not Good. 1.80-2.59 = Not Good. 2.60-3.39 = Good Enough. 3.40-4.19 = Good. 4.20-5.00 = Very Good. Based on the research results, the respondent’s answers regarding each indicator are as follows: the social media usage variable, with a total average of 3.29 which means that in general, respondents have a good perception regarding the usage of social media. The perceived business value has an average total of 3.76, which means that in general respondents have a good perception regarding the business value attained from the usage of social media by Silvercraft SMEs. The business performance variable, with an average total of 3.91, means that in general respondents have a good perception regarding the business performance achievement of Silvercraft SMEs in Celuk Village, Gianyar Regency.
| Table 4: Regression Equation 1 Path Analysis Results | ||||||
| Model | Unstandardized Coefficients | Standardized Coefficients | t | Sig. | ||
|---|---|---|---|---|---|---|
| B | Std. Error | Beta | ||||
| 1 | (Constant) | 2.472 | 0.209 | 11.824 | 0.000 | |
| Social media Usage | 0.391 | 0.062 | 0.536 | 6.289 | 0.000 | |
| R1 2 | 0.288 | |||||
| F Statistics | 39.553 | |||||
| Sig F | 0.000 | |||||
Conclusions And Recommendations
The usage of social media in this research is measured by using three indicators and among the three indicators; the usage of new social media attained the lowest average score. Thus, silvercraft SMEs are expected to improve their ability in using another platform of new social medias, for the example Instagram, Line, and you tube. The perceived business value in this research is measured by using six indicators and among the six indicators; the customer service value attained the lowest average score. Thus, it is important for SMEs to improve their customer services in order to achieve a better business performance. The research was only carried out in the silver industry area in Bali, namely the village of Celuk, Gianyar, so the results of the study could not be generalized to the silver industry at different locations.
Future researchers are expected to develop this research by referring to the research limitations that have been conveyed earlier and add in other factors which they suspect to mediate the relationship between social media usage and business performance. Those factors must also be adjusted with the dynamics and developing trends in the digital era.
Sales
Funk states that sales can be increased by adding social media functions to corporate websites. For example, customer product ratings, “fan” and “email friend” options serve as ways to engage website users. This leads to user and company engagement that contribute to increased product sales.
In “Social Media for Business: 101 Ways to Grow Your Business Without Wasting Your Time,” Susan Sweeney writes that the social media platform is a cost-effective way to directly reach potential employees in that four out of five online Americans participate in a form of social media each month. Such a program also is a means to determine if a recruiting program resonates with potential employees through the feedback the company acquires regarding such items as the positions advertised and the recruitment program itself.
Billie Nordmeyer works as a consultant advising small businesses and Fortune 500 companies on performance improvement initiatives, as well as SAP software selection and implementation. During her career, she has published business and technology-based articles and texts. Nordmeyer holds a Bachelor of Science in accounting, a Master of Arts in international management and a Master of Business Administration in finance.
Sources:
https://sproutsocial.com/insights/importance-of-social-media-marketing-in-business/
https://www.abacademies.org/articles/the-influence-of-social-media-usage-on-the-perceived-business-value-and-its-impact-on-business-performance-of-silver-craft-smes-in-8933.html
https://smallbusiness.chron.com/highlevel-business-impact-social-media-38816.html