Banks, financial institutions and healthcare providers are slow on social media adoption.
The retail, hospitality, transportation and technology industries are early adopters of using social media as a customer service channel, and are using it pervasively. However, companies such as banks, financial institutions and healthcare providers are much slower and more reluctant to use this channel due to security, privacy and regulatory concerns.
Ovum said social media as part of customer relationship services is a young market, and strategies around it remain underdeveloped due to confusion and resistance at the executive level of several industries.
CEOs and senior executives fail to see how social media adds value to their overall strategy. They are reluctant to invest in social media though monetarily it is not a huge investment.
“Social media often only requires a miniscule fraction of the seats and revenue required for traditional channels, yet it can provide enterprises with valuable real time market data. However, enterprise executives are yet to see this value,” said Margaret Goldberg, Ovum IT services analyst.
Ovum warns that enterprise leaders are going to fall behind if they do not leverage social media.
“More customers are using social networks to voice complaints and praise. This is a trend that will continue as the generation that grew up with social media matures. Social media is a horizontal technology in a vertical structure that, if used well, can help a company position itself more competitively,” Goldberg added.
A number of social networks have emerged and some have lost their appeal within the past year. Social media such as Ping, Buzz and Google Wave are long gone. Instagram (recently acquired by Facebook), Pinterest and Tumblr, to name just a few, are emerging.
Outsourcers will need to develop or integrate with platforms that are able to work with these new sites and aggregate data for analytics. As outsourcers further expand their social media offerings and their own software, it will be crucial to make these as flexible and robust as possible in order to reduce cost, lower time taken to adapt, and more analyze the massive amounts of data on these sites.
Outsourcers should also figure out how to manage the continuing shift to mobile, and develop tools in order to monitor and analyze social network customer engagements generated on mobile devices.
According to a report in InfotechLead.com, social media revenue is likely to reach $16.9 billion in 2012, up 43.1 percent from $11.8 billion in 2011. Advertising revenue of social media will be $8.8 billion in 2012. Social gaming revenue has more than doubled between 2010 and 2011 and is expected to reach $6.2 billion in 2012. Revenue from subscriptions will be $278 million this year.