Report Finds Social Media Engagement Drives Revenue

The more deeply a company engages with social media, the more likely the company is to increase revenue, says a research study conducted by Altimeter and Wetpaint. Titled “The World’s Most Valuable Brands: Who’s Most Engaged‚” the report ranks the Top 100 global brands in terms of their social media participation. The report claims to show a statistically significant correlation between higher social media engagement yielding higher company revenue.

We found the researchers methodology illuminating. In our experience, many companies are using social media but few of them are quantifying their efforts or directly measuring ROI. Most companies don’t even know what social media success looks like.

Altimeter and Wetpaint set out a way to quantify a company’s social media marketing efforts by evaluating 40 different attributes. The resulting metric is called “engagement.”

What they found is:

  • Financial performance correlates with engagement. Companies that are deeper and more broadly engaged with social media outperform their competition in revenue and profits. For example, the study found that the most socially engaged companies typically enjoyed revenue growth of 18% on average over the last 12 months, while the laggards saw revenues fall 6%.
  • Engagement differs by industry. Not surprisingly, technology and media companies are most engaged with social channels while financial service firms are among the lowest.
  • The researchers are quick to point out that their findings are correlations, not direct cause and effect. However, it’s quite clear there is a strong relationship between a company’s social engagement and its financial success.

You can download the 19-page report showing their methodology and full list of 100 companies they evaluated.


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