This week we are sharing fellow PRBI member Lucy Siegel’s blog on social media growth…

In a provocative article on Entrepreneur magazine’s blog recently, columnist Mikal Belicove, a social media specialist, reported there is now research showing that big companies are less social media conscious than small companies. Why are big companies less social media conscious? And, on the flip side of this question, what motivates smaller companies to use social media more aggressively?

The research data came from the University of Massachusetts-Dartmouth’s’ Center for Marketing Research. The Center’s study, “The 2011 Fortune 500 and Social Media Adoption: Have America’s Largest Companies Reached a Social Media Plateau?”, was based on data from the 2011 Fortune 500 list of companies, the Inc. 500 list of the fastest growing private small companies, and also the largest charities and institutions of higher education.

The researchers looked for blogs, Facebook pages and Twitter followers at all of the institutions. The companies were deemed to have blogs if they had “a public-facing corporate blog from the primary corporation with posts in the past 12 months.” The research repeated similar studies done annually since 2008. The researchers concluded that the use of blogs, Twitter and Facebook has grown very little in the past year at these large companies. Moreover, the Fortune 500 companies came in last among all the groups in adopting social media every year for the past four years.

In his blog post, Belicove suggests that big companies are risk-averse because they want to protect their top market positions, and are deliberately slowing down their adoption of social media because they believe they have more to lose than to gain from encouraging consumer/customer participation.

Why are smaller companies using social media more than big ones? Neither the researchers nor Belicove answered this question. My guess: the absence of big corporate bureaucracies and legal departments gives the marketing people at small companies more flexibility. Of course, small companies also have less money for marketing than big ones. Social media costs less than advertising and many other forms of communications (although it is not free, as many seem to think – the people costs involved in social media program development and maintenance are considerable).

The results of this study are heartening for small businesses. Small companies are able to be more flexible and nimble than big ones, and those attributes may well be giving them an edge in the use of social media for public relations.

There was a comment on Belicove’s blog post that big companies may be slowing down on their use of social media because it doesn’t produce sales results. This isn’t true, however, since the use of social media to find and attract prospective clients is one of its most important business applications, in my opinion. The ability for a company to obtain data on customer preferences and to build closer relationships with customers is a huge sales advantage.

In addition, the advent of the internet and social media in particular has changed the sales process for most companies by enabling a switch from “outbound marketing” to “inbound marketing.” Hubspot, on its excellent “Inbound Internet Marketing Blog,” defines outbound marketing as pushing the marketing message out, via trade shows, seminar series, email blasts to purchased lists, internal cold calling, outsourced telemarketing, and advertising. These methods are less effective than they used to be because prospective customers are inundated with marketing messages and have found ways to shut them off or screen them out. With inbound marketing, in contrast, says Hubspot’s CEO and Founder, Brian Halligan, “you help yourself ‘get found’ by people already learning about and shopping in your industry.”

Inbound marketing provides warm leads and eliminates the need for cold calling. I don’t know about you, but anything that cuts down on cold calling is fine with me!

If you’re in healthcare, insurance, technology or other professional services industries, and need help with a social media program, contact Scott Public Relations.

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