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Low ROI, PR disasters and high costs – What’s the point of social media in SA?

Following a PR disaster last week, Ornico has today released the South African Social Media Landscape 2020 report and if you’re in the social media space it’s a rather concerning read.

Before we dive into the concerning parts of the report we should highlight something else that struck us as odd from the report.

Last week Ornico drew warranted criticism for hosting an event about social media in South Africa which featured no Black speakers. While Ornico quickly corrected this we’d have thought the firm would have included insights from the new panel of speakers in its report. This is not the case.

When we asked Ornico about this they gave us this response.

“We have been hosting panel discussions around our findings for most of this decade, at events coinciding with the release of the report, and geared towards providing further insights rather than adding to the content of the report. Insights by our esteemed panel are available on YouTube and can be viewed here. These offer an added perspective on the use as well as trends around social media in South Africa.”

This is rather confusing as the insights in the report were from the original line-up of speakers so we don’t really buy the explanation that the new speakers were there to add perspective to the report. Had the speaker line-up not been changed, was Ornico asking folks to give up 90 minutes of their time to hear the insights rather than read them? It’s yet another misstep from Ornico and we really hope it does better in future.

Anyway, onward to the report.

Ornico tells us that 102 brands and agencies responded to a survey about the spend and usage of social media in the next year. Of those, the respondents are split into the following industries:

  • Digital/Social Media – 25.5 percent
  • Marketing – 17.6 percent
  • PR – 17.6 percent
  • Advertising – 10.8 percent
  • Media – 8.8 percent
  • Research – 4.9 percent
  • Sales – 3.9 percent
  • Media Buying – 2 percent
  • Crowdfunding – 2 percent
  • Other – 7 percent

Of the respondents, 76.5 percent have a social media strategy for the business to consumer market, while 57.8 percent have a business to business social media strategy.

Looking at platforms, Facebook is by far and away the most popular platform with 89.2 percent of respondents saying they are currently active on the platform. Twitter follows behind closely with 77.5 percent of respondents saying they are active there and surprisingly LinkedIn comes in third with 75.5 percent of respondents stating they are active on the platform.

As for aspirational platforms, 31.4 percent of respondents said that TikTok is a platform they want to be active on in the next 12 months with 25.5 percent stating that WhatsApp is in their sights.

While this diversity in platforms is great to see, having a presence on a platform and spending budget on those platforms reveals a canyon of differences.

While most firms have a presence on the bigger social networks only one appears to draw in majority of a brand’s money – Facebook.

As many as 59.4 percent of respondents said that most of their social media budget is spent on Facebook, with LinkedIn and Instagram coming in second with 15.6 percent and 11.5 percent respectively.

Despite Facebook’s many controversies over the years, brands have actually shifted spending to the platform over the last year for live streaming.

As many as 43.1 percent of respondents said that their brand has increased spending on live streaming for Facebook in the last year.

What do you get for your money

Things get very worrying when the report shifts to looking at return on investment (ROI) as regards social media spend.

The question “has social media brought brand returns” yielded the following results:

  • Yes – 66 percent
  • No – 3 percent
  • Unsure – 31 percent

Let that simmer for a minute.

As many as 31 percent of respondents are unsure whether being on social media has yielded returns.

It gets worse though, when quizzed about what those returns are, 54.1 percent said “brand awareness” while only 13.3 percent said that their brand’s social media presence had brought in sales.

Why then is social media still so popular for spending. True, the eyes are there, but it’s not bringing in value aside from letting folks know you exist.

Well that’s where the precariousness of the situation comes into play.

Ornico found that the two biggest hurdles faced by local firms that prevents them from clawing more value out of social media is a lack of budget.

Added to that is a lack of time to properly manage channels and a lack of understanding from management about what social media can achieve.

It seems then as if firms don’t see the value of social media anymore and it’s hard to argue with that.

Twitter is widely regarded as a cesspool of hatred, racism and bigotry and Facebook is currently courting controversy, again.

It makes sense then that brands don’t want to play in that space full time because, as Ornico learned last week, one misstep can create a snowball of issues and the returns – as we can see above – just aren’t worth it.

Influencers don’t do much

While much has been said about influencers it seems as if locally brands are moving away from making use of them.

When asked if their brand uses influencers, 70.6 percent of respondents said no. This is a drastic increase from 2019 when 64.3 percent said no.

Indeed Ornico’s chief executive officer, Oresti Patricios highlights that industry is questioning the value influential figures bring to the table.

“Both 2019 and now 2020 have been years of questioning the relevance of the influencers and balancing the scales of what goes viral because it’s paid for versus what makes the news because it resonates,” says Patricios.

The CEO uses the example of the KFC Proposal which grabbed headlines last year. While many brands jumped on that bandwagon, at the end of the day the only brand which enjoyed long-term recognition from the event was, KFC.

Anecdotally speaking, as a social media user it’s painfully clear when something is a planned and paid for activation. Hell, remember the One on Nicol drive thru bar which sparked outrage amongst Joburgers? For all the conversation that activation generated we have to ask what the ROI for it was? In December of that same year, at the time the above activation was happening 767 people died on the roads.

It appears then that local firms need to reassess how social media adds value or even if it can add value.

While being able to converse with customers is great, why risk a Twitter pile-on that a social media or marketing team has to address when you can avail yourself via email, a contact centre, WhatsApp or SMS.

What the South Africa Social Media Landscape report has shown us is that companies really need to reassess what they are doing online because from where we’re sitting, social media is costing more than it’s worth.

You can find the full report here and watch the webinar presenting the results below.

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