Privately held businesses understand the importance of communicating via social media to connect with markets and boost their bottom line, but most are weighing up their return on investment (ROI) before diving in.
The results of Grant Thornton’s latest International Business Report show only 44.9 percent of privately owned businesses engage stakeholders through social media, compared with emerging markets like Latin America where more than three quarters of private businesses aim to increase their use.
Grant Thornton partner Bill Shrew said local businesses are well aware of the importance of social media in connecting business to potential markets.
“The real question for Australian privately held businesses is where they fit in the market and what resources are required for social media to make an impact on the business’ bottom line.”
Around 31 percent of social media used by local privately held businesses engages stakeholders via advertising, with 18.8 percent used to connect with customers, followed by driving recruitment.
Results show local businesses approaching social media with caution so as to assess which part of the market they can target and defining messages, before risking business reputation.
Shrew says it’s often difficult for business to see the correlation between investment and return with their limited resources.
“Constraints in resources, both in terms of time and money are major factors holding businesses back from taking on social media. While they recognise the significant impact social media can have in reaching out to potential markets, most don’t have the resources to maintain their presence in the medium.”
The retail industry has increasingly used social media to drive people into stores, aided by the increasing popularity of group buying and mobile applications allowing comparisons between stores.
“Certain business to business industries are using social media to engage with markets such as printing and technology but, for the most part, retail businesses in Australia seem to be taking the lead in using social media to entice and enhance customer relationships.”
Whilst local businesses aren’t taking up social media as quickly as other nations, they do recognise its potential and will put more time and money into the practice when more resources become available.