Over the past month, the news has been awash with acquisitions of social media marketing companies. First Oracle purchased Vitrue for $300 million, and then Salesforce bought Buddy Media for $689 million. The sheer value of these deals should silence those who doubted the worth of this space; indeed unconvinced investors and brands alike are sitting up and taking notice of social media marketing. Why are social marketing companies in such high demand?
The market is consolidating rapidly, with large IT companies increasingly attracted to invest in social marketing companies, in the hope of adding a decent social marketing dimension to their offerings. Social marketing is still arguably in its childhood, but the speed of its growth within the advertising market is impressive.
Businesses understand the importance of using social media to engage with customers at every point along the customer life cycle, but don’t always have the in-house technical or human resources to dedicate to an extensive social strategy. This leaves a huge opportunity for social media marketing technology companies that can: a) help unlock the ROI of social, b) eliminate the complexity of marketing on ever-changing social networks, and c) help brands engage in personal, two-way conversation with the real person behind every ‘fan’.
Despite Facebook’s post-IPO wobbles, even the most technophobic businesses acknowledge that a social media presence for their company is now essential for a well-rounded brand image. Social may have started as a means of interacting purely for fun, but it has become an integral part of both marketing and business. The fact that Salesforce and Oracle decided to invest so heavily in social reflects the huge demand among business customers for social media services.
The future of social media marketing is very bright, and the space may well be subject to further consolidation and investment if recent social tech acquisitions are anything to go by. The market is constantly evolving, providing numerous marketing opportunities for brands to engage with customers across various platforms and to monetise their huge audiences of ‘fans’, ‘followers’ and ‘friends.’
The opportunity for social technology platforms only grows as brands request more creative, authentic-feeling ways to engage with users across networks like Facebook, Twitter, LinkedIn, YouTube and Pinterest (a new arrival in the pantheon of social sites). An increasing number of brands now understand social as a fundamental part of the marketing mix and future enterprise architecture. Those companies that take full advantage of social marketing tools that help them engage social audiences, will leave behind any competitors that dismissed social as a passing fad.
Victoria Ransom is CEO of Wildfire Interactive, a company helping optimise businesses’ online marketing with a range of tools.