Businesses look to social media to drive growth

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social media is expected to be a huge growth area for business next year, with almost nine in ten businesses saying they will be investing more in the phenomenon.

Among companies with a turnover of at least £25 million, 87 per cent said they saw it as a cost-effective communications tool with more than a third (39 per cent) saying it improved their commercial or reputational standing.

The research, by Royal Bank of Scotland Corporate & Institutional Banking, also shows that senior executives are making wider use of tablet computers with nearly half (47 per cent) using tablets regularly. John Dixon, head of technology, media and telecoms from Royal Bank of Scotland CIB, said: “UK businesses clearly understand the importance of social media.

“It is an effective and cost-effective tool, and its increased popularity comes at a time of increased pressures on marketing. The challenge is for firms to maximise their investments beyond 2012.”

A quarter (25 per cent) of firms increasing social media spend said that it resulted in a positive impact on the brand. However, not all firms have a clear social media strategy. Some 39 per cent of firms looking to increase spend in this area say they are doing so to simply keep up with industry trends and/or competitor activity.

Of the 13 per cent looking to cut social media spending next year, more than half (54 per cent) said this was because of budget restrictions while 27 per cent saw no return on investment.