Social Media & Its Importance For Brands. September 2015

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1 Social Media & Its Importance For Brands September 2015

2 Contents 3. Introduction 4. Key Points 5. Conclusions 7. Frequency Of Using Social Media 8. Interacting With Consumers 10. Types Of Company Ever Liked/Followed On Social Media 11. Types Of Company Unlikely to Follow/Like On Social Media 12. Using Social Media To Obtain Information Or Support 13. Preferred Method Of Contacting A Company 14. Turning Consumers Off 15. The Influence Of Social Media On Purchasing Behaviour 17. Customer Closeness 18. Complaints & Feedback 20. Getting Involved 21. The Future

3 Introduction From advertisements on Facebook and Twitter, to celebrity endorsements of brands on Instagram, to displaying products on Pinterest boards, it s clear that businesses are taking advantage of a wide range of social media opportunities in order to connect with customers. With this in mind, McCallum Layton first conducted a Snapshots study in 2014 to understand how UK consumers perceive the growth of this relatively new phenomenon and identify the impact it has had on the way they view and interact with companies and brands. This report shows the results of the second wave of this study conducted in As with all our Snapshot surveys, this will be repeated annually to track changes over time. Interviews were conducted online with 402 UK adults (over 18) who use social media platforms at least every 3 months. Our sample was nationally representative by age and gender. 3

4 Key Points Facebook is by far the most popular social media platform with 60% using it on a daily basis, followed by YouTube (23%) and Twitter (21%). Reflecting this, consumers are far more inclined to like a company/brand on Facebook (53%) than to follow one on Twitter (26%). There is a strong connection between liking/following a company brand on these social media platforms and propensity to buy from /recommend them especially amongst year olds. The main motives for liking/following companies or brands on Facebook or Twitter is to receive offers/competitions, or to keep up to date with the latest news about them. Around two-fifths would be likely to refer to comments on Facebook if seeking reassurance about a company before buying from it, and around a quarter would look at comments on Twitter. Around a fifth have interacted with a brand or company as a result of seeing a Facebook page or Twitter handle on television. Overall, 36% of consumers are likely to use social media to obtain information or support from a company. Amongst 18-34s the proportion is far higher at 58%. However, only 16% overall (23% of 18-34s) would prefer to use social media to contact a company is the most favoured method of contact. Around one in two consumers are likely to share a positive or a negative experience of a company or brand through social media, with 18-34s especially inclined to do so. The majority (58%) would be interested in contributing through social media activity to a company s NPD process; the level of interest amongst 18-34s is particularly high at 81%. Two thirds believe that the degree to which they interact with companies/brands through social media will not change in the next 12 months whilst 29% anticipate that it will increase. 4

5 Conclusions (1 of 2) When Facebook was launched by Mark Zuckerberg in February 2004, no-one could have envisaged the impact that social media would have, not only on the way we conduct our personal relationships, but also on the business world. Facebook recently announced that it had recorded a billion users on a single day equal to a staggering 1 in 7 people in the world! Few organisations can therefore afford to ignore the power that social media exerts on today s consumer. Our survey shows that not only does social media have a strong direct influence on people s propensity to purchase from or recommend a company or brand, it also has a more subtle but no less important role in terms of enhancing a company s or brand s image and reputation, and promoting that all elusive feeling of emotional attachment. The omniprescence of Facebook is not surprisingly reflected in our survey results, but what is of interest is how quickly some of the newer sites seem to be growing; Pinterest which was launched around five years ago was used by around one in three people in our study and one in two year olds and around one in five claimed to use Vine which has only been in existence for a couple of years. Astute organisations should be keeping an eye on these up and coming platforms and should consider incorporating them into their social media strategy especially if their brand is one which seeks to attract the younger generation and cool kids. 5

6 Conclusions (2 of 2) Social media content from brands in the food and grocery, fashion, and health and beauty sectors along with that from supermarkets is most appealing, whilst content from financial organisations and utilities is of least interest. More than likely this is at least in part due to the fact that many people are motivated to like or follow companies in order to receive special offers or competitions such offerings from the former types of organisation are generally more likely to be of relevance and interest than those from the latter. Again, financial institutions, utilities and other service organsiations may benefit from taking advantage of some of the newer platforms, which allow companies to connect more with customers/potential customers without having to be so focused on incentives - for example Petplan insurance maintains pinboards with tips and hints aimed at pet lovers, and has done an excellent job of relating its messaging to an overall strategic goal. 6 Results from our 2015 survey are broadly in line with those recorded last year however one potentially interesting shift is a significant fall in the percentage who believe they will interact more with companies and brands through social media over the next 12 months (from 29% in 2014 to 22% this year). Could this be an indication that the growth rate of social media is starting to slow? Perhaps rather than using social media per se more frequently, people will start to diversify more in terms of the platforms they use. It will be interesting to see whether when we carry out our 2016 survey this decrease is simply a blip, or indeed the start of an on-going trend signifying that the market is on the road to saturation with new entrants growing at the expense of more established players.

7 Frequency Of Using Social Media Facebook is the most frequently used social media platform it is accessed on a daily basis by almost three times as many people as either YouTube or Twitter. Not surprisingly, younger respondents (18-34s) are generally significantly more likely than older people to be regular users of each of the platforms. However, Facebook appeals to all age groups, with even 48% of over 55+s using it on a daily basis. It is also popular with both genders although a higher proportion of females than males use Facebook daily (69% compared to 51% of men). Cumulative frequency of using social media platforms Daily 60% 23 % 21 % Around 1 in 3 have ever used Pinterest or Instagram, and around 1 in 5 have ever used Vine, Snapchat or Tumblr. Fewer than 1 in 6 have used Myspace. Periscope was the least popular platform with around 1 in 10 people saying they had used it Weekly 83% 53% 38% Monthly 90% 68% 45% Ever 94% 80% 51% Base: all respondents: total (n=402) 7

8 Interacting With Consumers (1 of 2) Around three-fifths (62%) of social network users have liked a company on Facebook and around 1 in 5 (21%) have followed a company on Twitter. Usage of both is more prevalent amongst younger people, but a relatively high proportion of over 55s 47% - have liked a company on Facebook. Proportion who like/follow companies on social media 53% 71% 58% 34% Total sample 18-34s 35-54s Over 55s 26% 40% 30% 9% Base: all respondents: total (n=402) Significantly lower than

9 Interacting With Consumers (2 of 2) Receiving offers/competitions and keeping up to date with the latest news are the main reasons why consumers like or follow companies or brands on social media. Reasons for liking/following companies on social media 69% To receive offers/competitions 68% 62% To keep up to date with the latest news about them 68% 48% To receive more info related to my personal interests 63% 34% As a mark of my interest/loyalty 34% 31% I just like their content 24% 26% To show other people I like them 18% NB The code I just like their content was added to the 2015 questionnaire meaning results cannot validly be compared to those from last year s survey Base: all respondents who liked/followed a company on social media: Facebook (n=215), Twitter (n=104) 9

10 Types Of Company Ever Liked/Followed On Social Media Manufacturers/sellers of consumer goods (food/grocery, fashion, health & beauty, etc..) tend to be liked/followed more than service providers (charities, travel, telecoms, etc.). Whilst females are significantly more likely than males to have liked/followed a fashion, health and beauty or charitable organisation, the opposite is true in relation to banks/building societies (mentioned by 6% of females compared to 13% of male respondents). Rank % 1 Food/Grocery 28% 2= Fashion 25% 2= Health & Beauty 25% 4 Supermarkets 24% 5= Charities/Good Causes 21% 5= Travel/Holiday 21% 7 Newspapers/Magazines 18% 8 Electronics 17% 9 Telecommunications 12% 10 Banks/Building Societies 10% 11 Utilities 7% 36% overall (ranging from 17% of 18-34s to 55% of 55+ year olds) have not followed/ liked any company or brand on social media. Loan Companies 12 2% Base: all respondents: total (n=402) 10

11 Types Of Company Unlikely To Follow/Like On Social Media Financial institutions such as loan companies and banks/building societies, along with utility suppliers are the least likely types of organisation to be followed/liked on social media. Banks/building societies are unlikely to be liked or followed mainly due to a lack of consumer interest in what they have to say or a lack of trust in banks per se. Rank % 1 Loan Companies 61% 2= Banks/Building Societies 42% 2= Utilities 42% 4 Telecommunications 33% 5= Travel/Holiday 27% 5= Newspapers/magazines 27% 5= Fashion 27% 8= Charities 26% 8= Electronics 26% 8= Supermarkets 26% 11 Health & Beauty 25% Food/Grocery 12 22% Base: all respondents: total (n=402) 11

12 Using Social Media To Obtain Information Or Support This was a new question on the 2015 survey. Just over a third of consumers are likely to use social media to obtain information or support from a company. Propensity to do so decreases with age (58% of 18-34s vs just 18% of 55+ year olds) and is slightly higher amongst females than males (41% compared to 32%). Half of those likely to use social media in this way believe they are more likely to receive a response as a result. There is unlikely to be any recovery in the housing market this year many people are still deterred from moving due to the economic Base: all respondents: total (n=402) Total respondents 36% Total likely Total respondents 63% Total unlikely % 29 27% 30% 33% Very likely Quite likely Quite unlikely Very unlikely

13 Preferred Method Of Contacting A Company Amongst those who would use social media to contact a company for information or support, is the method which is most likely to be used (36%), followed by telephone (24%), and then social media (16%) and web chat (15%). Males are more than twice as likely as females to prefer to talk to someone (36% vs 15%) and year olds are more inclined than older consumers to prefer to use social media (23% vs 9%). There is unlikely to be any recovery in the housing market this year many people are still deterred from moving due to the economic 36% Telephone 24% 16% 15% Social Media Web chat 5% 3% Fill in form online Letter Base: all respondents likely to contact a company via social media to get information/support (n=146) 13

14 Turning Consumers Off Almost two-fifths (38%) of those who have ever liked a company on Facebook have unliked one or more companies or brands; the proportion is significantly higher amongst 18-34s than older consumers (58% compared to just 17% of the 55+ age group). A similar percentage (37%) of those who have ever followed a company/brand on Twitter have unfollowed one or more. Amongst 18-34s the likelihood of unfollowing companies or brands has risen significantly since 2014 (from 27% to 52%). Reasons for unliking a company on Facebook* 52% Posts too frequent 44% Posts not interesting 22% Offers not attractive enough Base Facebook = 89 18% Offers not frequent enough 14 * NB Base sizes are too low to show reasons for unfollowing a company on Twitter but they are broadly the same as reasons for unliking a company on Facebook.

15 The Influence Of Social Media On Purchasing Behaviour (1 of 2) A third of respondents believe that the growth of social media has made them more likely to shop around for goods and services, which is not significantly different to the 2014 result. The proportion who think it has had a positive influence in this respect is higher amongst 18-34s than older consumers (53% vs 21% of the 55+ group). In 2015 it is also significantly higher amongst females than males; the figure for females at 40% is very similar to last year but the 28% of men who are more likely to shop around due to social media is significantly lower than last year s result of 41%. Reviews on forums are by far the main method by which consumers seek reassurance about companies before buying from them. Overall results on this question are not significantly different to those from the 2014 survey. Likelihood (very likely/quite likely) of using the following for reassurance on a company 73% 54% 44% 27% Reviews on forums Company s own website Comments on Facebook Comments on Twitter Base: all respondents: total (n=402) 15

16 The Influence Of Social Media On Purchasing Behaviour (2 of 2) As in the last survey, the link between liking/following a company and propensity to buy from it or recommend it to friends and family is very apparent; interestingly compared to last year there is a significant increase in the % saying they are much more inclined to recommend a company that they follow on Facebook (27% vs 19% in 2014). In line with previous findings, 18-34s are far more likely than older consumers to admit to being influenced by these social media platforms. Likelihood to buy Like a company on much more likely slightly more likely no more likely 25 % 45 % 31 % Follow a company on Likelihood to recommend Like a company on 35 % 43 % 22 % 27 % 42 % 31 % Around two-fifths of 18-34s who like a company/brand on Facebook claim to be much more inclined to buy from/ recommend it as a result Follow a company on 33 % 43 % 24 % Significantly higher than 2014 Base: all respondents who liked/followed a company on social media: Facebook (n=215), Twitter (n=104) Significantly lower than

17 Customer Closeness The importance of social media in terms of enhancing an organisation s relationships with customers is highlighted by the responses to the statements below. Around two fifths agree that companies which have a strong social media presence know their customers better, that social media allows customers to get more of a feel for a company s brand/personality, and that companies that invest in social media are likely to be more open and honest. Results are broadly in line with those from the 2014 survey. The level of agreement with each statement is significantly higher amongst 18-34s than older consumers. Companies which have a strong social media presence know their customers better Social media allows me to get more of a feel for a company s brand s/personality Companies with a strong social media presence are more open & honest Comments posted on social media sites strongly influence my opinions of companies & brands A strong social media presence increases the extent to which I trust a company or brand I feel more emotionally attached to a company or brand as a result of its social media activity 44% 41% 39% 33% 33% 25% Extent to which respondents agree that. Base: all respondents: total (n=402) 17

18 Complaints & Feedback (1 of 2) There is a high degree of willingness amongst consumers to share their experiences of a brand through social media; around 1 in 2 people are likely to share positive experiences and a very similar proportion are inclined to share negative ones. Overall results are very similar to those from the 2014 survey. Likelihood of sharing a positive experience 52% Total respondents 75% 56% 28% Likelihood of sharing a negative experience 49% Total respondents 68% 52% 29% Base: all respondents: total (n=402) 18

19 Complaints & Feedback (2 of 2) Respondents were asked the extent to which they agreed with the following statements:- I feel that companies take complaints more seriously if they re posted on social media websites then if made directly to them I m more likely to let a company know I m dissatisfied if I can contact them though Twitter or Facebook than if I went to their customer service Over two-fifths (45%) of consumers feel that companies take complaints more seriously when posted on social media websites than if made directly to them, and around a third (31%) are more likely to let a company know they are dissatisfied if they can do so through Twitter or Facebook both of which are very similar to their respective 2014 results. In each case 18-34s are significantly more likely than older consumers to be of this opinion, as are females compared to males. Agreement: Companies takes complaints more seriously 16% 29% 35% 9% 12% Agree strongly Agree slightly Neither agree nor disagree Disagree slightly Disagree strongly Agreement: More likely to say I m dissatisfied 9% 22% 30% 13% 26% Agree strongly Agree slightly Neither agree nor disagree Disagree Disagree strongly slightly Base: all respondents: total (n=402) 19

20 19% have interacted with a brand or company as a result of seeing a Facebook page or Twitter handle on television Getting Involved Whilst only a minority 18% - have been involved with a company s NPD process through social media, almost three-fifths overall (and 81% of 18-34s) claim they would be interested in contributing in this way in the future. Compared to last year there has been a significant increase in the proportion who are not at all interested (from 15% to 23%) which is driven by 55+ year olds (25% in 2014 vs 43% this year). 23% Not at all interested 17% Very interested Interest in contributing through social media activity to a company s NPD process 19% Not very interested 41% Quite interested Base: all respondents (n=402)

21 The Future As in 2014, the majority of consumers do not think that the extent to which they interact with companies/brands through social media will change over the next 12 months. However almost 1 in 3 expect such activity to increase with 18-34s being especially likely to be of this opinion (41% vs just 16% of the 55 age group). Interestingly, the proportion believing they will interact more over the next 12 months fell to 29% from 39% in 2014, which is largely driven by 55+ year olds. Will your interaction with brands/companies through social media change over the next 12 months? 68% Increase greatly Increase slightly Remain the same Decrease Significantly higher than % Significantly lower than % 2% Base: all respondents (n=402)

22 Please contact us if you have any queries on this report, or to find out more about our services. We offer a full range of quantitative and qualitative methodologies plus: - Strategy Surgeries: to understand the strategic implications of your insight - Insight Action Audits: to ensure your insight is driven to the heart of your business - Advanced Analytics: to derive maximum value from your data - MLTV: to disseminate your insight to key audiences in a powerful and engaging manner McCallum Layton Bramley Grange Skeltons Lane Thorner Leeds LS14 3DW Tel. +44 (0) Fax. +44 (0) Matt Counsell Head of Quantitative Research

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